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 We do have a quorum. It's 9.02 and we're going to call to order the Public Utilities Board

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 of the City of Denton for July 27th, 2020. The first item on the agenda and I'm going

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 to pull item A that will give Billy an opportunity to not vote or abstain from the vote. Does

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 any board member wish to pull another item? What item did you say, Susan? E. Yeah, C is

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 in Charlie. And I had a couple of brief questions on A and B. A and D is in Donald? No, B is

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 in boy. Okay. Oh, and also F. Sorry. All right. So Susan, or I guess Larry, do I need to just

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 leave the meeting and then get Kim to let me back on after this discussion? Correct.

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 Okay, so I'm not sure how that's going to work and when she'll tell me it's over. She

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 can email you or text you. Okay. So. So then we have item D. You wanna go backwards? Could

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 we approve item D? Motion to approve. I move we approve item D. I'll second. All in favor

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 say aye. Aye. Opposed? Okay. Why don't we do item E first so that Billy can get off

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 and then we'll come back in and he can hear the rest of the discussion. I didn't really

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 have any questions on it. I just knew that we needed to give Billy the opportunity to.

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 Yeah, I have a question, Susan. Okay. On the spreadsheet that shows a summary of the bid

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 amounts, there are dollars shown, there are quantities shown, but there are no units of

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 measure shown. So that needs to be shown. For instance, there are 740 something at a

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 price of so many dollars, but the units of measure are not described on the sheet. We

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 have Laurie Huell. She's our purchasing manager. She's on the on the line. She may be able

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 to give some insight on that. Hi, yes. Laurie Huell, purchasing manager. We can add that

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 to there and send it out to you. Yeah, we need to see that. That's an important piece

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 of information. Okay. That's all I had. Do we have a moment to move the item? One silly

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 question. What does PEC stand for? PEC stands for Pecan Creek. That's just part of a drainage

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 area within the city. EEC4. Okay. That's just one of the branches of the concrete drainage

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 ways through the city. I don't feel as stupid for not knowing what that was. That's okay.

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 I'll move approval. Second. All in favor say aye. Aye. Okay. We can get Billy back on.

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 I've got it, Doc. Hold on.

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 Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay.

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 I'm sorry. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay.

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 Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay. Okay.

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 Okay. Okay. Okay. Okay. Okay. And he's back. Okay. Item A. Karen, what was your question?

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 Yeah, I just had a quick question clarification on A and B. So maybe we can vote on both of

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 those. I just wanted to clarify that if a vendor is on the pre-qualified list that then

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 it doesn't go out for bids. Is that why these two items didn't go out for bids? Or we don't

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 have a bid list at any rate. That's correct. Ms. Huell is on the phone as well. She'd be

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 able to explain that. And we should have someone from solid waste as well. Okay. Just clarification

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 of policy here. Sure. Yeah, that's correct. When they use the pre-qualified list where

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 we sent the RFQ request for qualifications out, and then we brought that list to council.

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 Here's all the firms that were pre-qualified. If they're using someone from the pre-qualified

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 list, we do not have to do another RFQ. Thanks. Just wanted that sort of to clear my head.

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 So I would move for approval of A and B, unless anybody else has questions?

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 Carolee, did you have a question? One quick question on item A. That's a pretty stout

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 amount for engineering and design services for a project. Do we have a ballpark idea

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 how much the total expenditure for the public disposal area is going to be?

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 This is Tina Eck, the senior business analyst for solid waste recycling. Part of the design

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 process will be to determine that full build, the full construction cost for the facility.

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 So you don't have a budget number? The budget number would essentially be that

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 design services, if you estimate that being about eight to 10% of the total construction

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 cost. Okay. So does that mean that rough numbers

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 you're thinking about spending a million and a half dollars for a public disposal facility?

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 That would be our estimate at this time, yes, until we get that design estimate back from

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 Biggs and Matthews. Okay. I'll just note that that seems like an

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 awful lot of expenditure for something we already own the land for. And maybe I'm missing

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 what's included in the design facility, but I am concerned about the level of expenditure

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 for that. The disposal facility will be where all of

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 our public traffic is routed. So if you think non-commercial traffic, it's meant to be a

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 safety improvement as well as a process improvement to get all of our smaller traffic vehicles

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 away from the booking space site and to have them an area to essentially deliver their

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 trash to more safely. So it's not just for the, say, recycling drop-off. It'll be more

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 expensive than that. Mr. Parker, I think there's also going to

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 be expenses on flat work, concrete work, as Tana mentioned, rerouting that to separate

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 commercial and residential traffic. So there'll be a lot of concrete work, probably a building

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 of some sorts to be able to accommodate those folks that come through. So there will be

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 an expense. So it's probably well over a million and a half dollars to do that kind of work,

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 even though we own the property, but it's just a construction work that's going to go

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 along with it. Okay. Thank you. All right. We had a motion

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 by Karen. Do we have a second? Second.

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 All in favor, say aye. Aye.

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 All opposed? I'll go opposed on that, please.

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 Okay. So just to clarify, my motion was for both

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 A and B. Right. I think Charlie is just objecting to A. That's correct.

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 Should we have another vote on B? I'm good with B, if we want to formalize that.

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 Larry had. Let's just go ahead. Since they were pulled

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 off consent, take individual votes. Okay. Okay. So I move for approval of B.

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 Second. Okay. All in favor, say aye.

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 Aye. Opposed? Okay. Are we good?

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 Then item C. Yes, I had a question about that. This is not so much about the cost here described,

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 but rather the event that happened that we had to clean up and repair and so forth. I'd

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 like to ask some questions about that. Mainly, did we – did anyone ever create any kind

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 of a root cause analysis or report on why and how that failure happened? That's a question

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 for management, not really for the purchasing department. Sure. We've got Ken Banks on

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 the phone who should be able to answer those specifics on what happened in that – on

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 that incident. Good morning, board members. Can you hear

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 me? Morning, yes.

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 Yes, good morning, everyone. To answer the question, yes, we did. We went back and took

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 a look at exactly what happened. In reconstructing those events, sometimes it's difficult to

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 tell. We basically had a catastrophic failure at the bell housing of the pump. We believe

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 that that was caused by a water hammer event that likely happened with an interruption

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 of electrical service out there briefly and corresponding water hammer event that went

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 down the line. Basically, those rebounded, came back, and caused the bell housing to

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 lose integrity. So we believe that that is what caused the problem. I can tell you also

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 that we have – we've got a brand-new pump station going in there. It's nearing the

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 end of completion of construction. We've got a few more things to do on the piping.

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 We've really focused our efforts on trying to ensure that we have redundancy and bypass

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 options that do not require us to cross Old Alton Street near the bridge. If you recall,

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 we had to bypass and basically go to the live station for Upper Trinity to pump the waste

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 until the repair was effective. Now we have a bypass with a direct pipe in that will allow

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 us to use an on-site emergency pump and continue to operate the force main if we have a catastrophic

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 failure in the new live station. So we've got a much more redundant system in place

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 now with the new live station, and we have the ability now to do a very high level of

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 bypass without having to cross the street. So we feel like we've got a reasonable idea

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 about what caused the event, and it was something that really couldn't have been managed for

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 effectively. The new pumps will be able to handle that in a much more better fashion.

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 And then at the same time, we really focused on ensuring that we had on-site bypass capabilities

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 so that we could respond to an event like that again much more rapidly and without having

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 to cause the inconvenience for citizens of us having to cross the street.

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 Okay. That's good, Ken. I guess my question is more a matter of internal processes and

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 the department for future – the future knowledge of future employees and so forth here. If

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 there's something here that can be learned, that can be documented, it would benefit people

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 down the road to know how this – exactly how this happened, how we think it happened,

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 and what could be done.

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 Absolutely. Yeah, and that's definitely something that we can put together. It's – the issue

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 is it's not going to – with the new live station and the new pumps, we don't feel

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 like we're going to have a similar event, but we have documented what we felt was the

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 cause of the situation. And certainly, we're in process now of trying to coalesce all those

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 post-event documents and really trying to get those into a centralized location. And

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 this will be one of those documents that we add.

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 Yeah, I would suggest that if we – if we don't already have a written procedure or

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 policy about doing a formal root cause analysis whenever we have a failure that results in

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 a permit violation – this was a permit violation, right, of our –

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 That – yes, that is correct. It resulted in a sanitary sewer overflow, so it is – absolutely.

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 So I guess my suggestion is simply this. If we don't have a formal written policy or

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 procedure for initiating an investigation on something like this, then I think we should

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 think about creating a policy or a procedure that would require it to be done whenever

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 there's a failure like this that results in a permit violation or some other big event

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 that happens. That's my – that's really my thought and my suggestion in this.

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 Yes, absolutely. We have – we definitely have standard operating procedures that require

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 an investigation for any on-site sanitary sewer overflow that we have. I will review

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 those and make sure that we have something in there that talks about lift station failures

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 in particular. I am pretty sure that we do, but I will go back and verify that. If we

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 don't, we'll get that added to our existing SOP.

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00:16:50,360 --> 00:16:54,720
 Yeah, okay. That's my only concern. With that said, I move –

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 Wait, Barbara has her hand up. Now, wasn't Hickory Creek the one we just

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 did a lot of work on and replacing stuff? Am I – is my timeframe correct or is the

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 work not completed? Yes, ma'am, you're absolutely correct. We've

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 got a new lift station there now. It is in – it is nearing completion for its construction.

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 We anticipate on having that online. We're doing a few more bypass options, so it's

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 taking a little bit longer. We had originally thought that it would be done at the – near

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 the end of the summer. We're looking at a date now of into the fall, and that's simply

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 because we're adding a couple more options to that system to allow us to more effectively

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 bypass. Okay, and secondly, I didn't see anything

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 about a fine, which usually – was it because it was reported so quickly or –

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 We have not received any information from the TCQ indicating that we have – we will

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 incur a fine. They have taken all of the information. We were in contact with them during the entire

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 event from the – right after it happened through all of the information exchanged with

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 them as we facilitated the repair. We feel that we did a very good and very responsive

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 job. I believe they feel that as well. So we have not gotten any communication from

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 them since the event that they are anticipating a fine. It's a possibility. It always is,

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 but I think that it's likely the look at this is just simply a force – or a catastrophic

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 event that we had no control over. Well, that's good. I was also glad to see

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 that local vendors were used on this job. I always like to see that.

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 Yes, ma'am. Ed has a question.

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00:18:54,120 --> 00:19:00,360
 Yeah. Ken, I have a question. You used the term – I think you said water hammer?

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 Yes. What – can you tell me what a water hammer

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 is, please? Yes, it's a pressure wave that is caused by

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 a quick turnoff and turn on, if you will, of the flow of water through a pipe. It creates

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 a pressure wave that has a tendency to move down the pipe and then come back and can cause

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 some pretty significant pressure on the pipe when it encounters the – a valve, for example,

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 or any other type of obstruction of flow. An example would be if you've ever had a

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 bathtub where you turn on the hot water and turn it on real – or turn it off real fast

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 in the pipe rattles. That's a small water hammer.

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00:19:47,680 --> 00:19:52,160
 Okay. Thank you very much. Sure.

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 Any other questions? Charlie?

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 I would like to move approval, and I would also ask that we note our thanks to the people

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 who dealt with the triage on this event. I'm guessing there was some really nasty work

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 that took place, and on behalf of the citizens, tell those people thanks.

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 Second. All right. We have a motion and a second.

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 All in favor, say aye. Aye.

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 Ghost? Carries. I can't remember who pulled F. Is that you, Russ?

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00:20:25,520 --> 00:20:33,600
 No, that was me. I'm sure Russ has a question as well. But I just had a quick – another

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 quick clarification. So for this contract with Genscape, I was just wondering if there

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 was any software involved that would need tech support, or if tech support was part

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 of the contract. I didn't notice it listed. Or is this just a sort of information feed

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 that we're contracting them for? And the software is our own responsibility.

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 Terry Lutrick – excuse me. Terry Nolte, excuse me, will be able to give you some insight

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 on that as well. You're muted.

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00:21:18,720 --> 00:21:24,160
 Good morning, Terry Nolte, Assistant General Manager, Amy. So Genscape is a data feed.

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 It provides us with relevant market information about the generating status of all the generation

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 units in haircut market. It's a piece of software that we have had under contract for

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 a number of years, and this is a renewal of that contract. It's critical information

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 for us to put together our bids and offers into the day ahead in real-time markets.

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00:21:51,640 --> 00:21:59,920
 Yeah. So is – I mean, do you anticipate any need for tech support or upgrades or anything

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 like that? I think this is a four-year contract.

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00:22:02,440 --> 00:22:11,080
 Yes, it is a – I believe it's a three-year with two one-year extensions. As I said, we've

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 had this piece of software in place for a number of years. It's the kind of Cadillac

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 of systems available in – throughout North America, and it's supported primarily by

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 the vendor. Any software upgrades are just pushed to us by the vendor.

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00:22:29,880 --> 00:22:33,200
 Okay. So it does include upgrades and –

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 Yes, ma'am.

189
00:22:34,200 --> 00:22:39,040
 Okay. Thank you. Any other questions?

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00:22:39,040 --> 00:22:46,760
 Honestly, I do have a question. Terry, this – it's described as a sole source. The

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 only ones that can do this, that's this group here, do they not have any competition

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 at all? Because I'm wondering if, from what I read in the description, they're taking

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 information that's available from other locations and basically compiling it and making it easier

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 and quicker for you to use. Is that right?

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00:23:10,120 --> 00:23:17,440
 That's partially what they do, Mr. Bafford. But one of the unique things that Genscape

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 does is they actually have field-located meters that measure the magnetic fields around the

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 transmission systems that are exiting each of these power plants. And so while information

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 that is publicly available as to the status of the facilities, Genscape provides real-time

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 information where we can get that information quicker than through ERCOT or other publicly

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 available means. And in our business, since prices change every five minutes, having that

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 real-time information is critically important.

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 Okay. Thank you.

203
00:24:02,040 --> 00:24:03,040
 You're welcome.

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 All right. Do we have a motion to approve?

205
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 So moved.

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00:24:07,680 --> 00:24:08,680
 Second.

207
00:24:08,680 --> 00:24:10,240
 All in favor say aye.

208
00:24:10,240 --> 00:24:11,240
 Aye.

209
00:24:11,240 --> 00:24:15,560
 I'm sorry, Ed, did you have a question or you just?

210
00:24:15,560 --> 00:24:19,320
 No, I was second or I was second.

211
00:24:19,320 --> 00:24:26,640
 Okay. All right. So the next item is consider approval of the minutes of July 13th, 2020.

212
00:24:26,640 --> 00:24:30,640
 Does anyone have any corrections or changes?

213
00:24:30,640 --> 00:24:42,200
 The attachment that I received was for June 22nd. Does anybody have the minutes of July

214
00:24:42,200 --> 00:24:46,360
 13th? I'm just looking at something weird.

215
00:24:46,360 --> 00:24:49,800
 Huh. I thought I read July 13th.

216
00:24:49,800 --> 00:24:54,000
 Yeah, but the actual attachment says June 22nd.

217
00:24:54,000 --> 00:24:55,000
 Oh.

218
00:24:55,000 --> 00:24:57,000
 Yeah, you're correct.

219
00:24:57,000 --> 00:25:04,400
 Since I missed that one, I was curious about it.

220
00:25:04,400 --> 00:25:07,920
 Looks like there may be an attachment error. So we may need to postpone that vote until

221
00:25:07,920 --> 00:25:14,280
 the following meeting. I may ask the city attorney to weigh in on that since the wrong

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00:25:14,280 --> 00:25:16,560
 attachment was included in the item.

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00:25:16,560 --> 00:25:20,520
 Moved to table until the next meeting.

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00:25:20,520 --> 00:25:21,520
 Second.

225
00:25:21,520 --> 00:25:24,080
 Okay. All in favor say aye.

226
00:25:24,080 --> 00:25:25,080
 Aye.

227
00:25:25,080 --> 00:25:27,600
 Okay. I got to leave again.

228
00:25:27,600 --> 00:25:29,680
 Yes, you do.

229
00:25:29,680 --> 00:25:36,720
 So Larry, I'll sign off and then ask to join and you can just let me on afterwards. How

230
00:25:36,720 --> 00:25:37,720
 about that?

231
00:25:37,720 --> 00:25:38,720
 Okay.

232
00:25:38,720 --> 00:25:39,720
 Barbara?

233
00:25:39,720 --> 00:25:40,720
 Question of Billy before he leaves.

234
00:25:40,720 --> 00:25:41,720
 Yes, ma'am.

235
00:25:41,720 --> 00:25:45,720
 What is a fire hydrant lateral?

236
00:25:45,720 --> 00:25:51,720
 The lateral line coming from the fire hydrant. It goes laterally. It's just a term for a

237
00:25:51,720 --> 00:25:55,240
 fire hydrant attack, you know, the water line attached to the fire hydrant.

238
00:25:55,240 --> 00:25:56,240
 Okay. Thank you.

239
00:25:56,240 --> 00:25:59,000
 Keep it. Okay. I'm out now.

240
00:25:59,000 --> 00:26:00,000
 Bye.

241
00:26:00,000 --> 00:26:08,160
 All right. Who's presenting this one, Mario?

242
00:26:08,160 --> 00:26:13,800
 That's a good question. I believe we've got Trevor Cain on the line along with Becky DeVine.

243
00:26:13,800 --> 00:26:18,360
 So I'm going to reach out to them.

244
00:26:18,360 --> 00:26:23,280
 Yeah, I'm here. This is Trevor Cain. Can you hear me?

245
00:26:23,280 --> 00:26:24,280
 Yes.

246
00:26:24,280 --> 00:26:29,560
 You may need to call them the caption, Susan.

247
00:26:29,560 --> 00:26:33,200
 I'm sorry. Oh, you want me to read the caption?

248
00:26:33,200 --> 00:26:34,200
 Yes, ma'am.

249
00:26:34,200 --> 00:26:38,440
 Consider recommending the adoption of an ordinance for the city of Denton, a Texas home rule

250
00:26:38,440 --> 00:26:44,840
 municipal corporation, authorizing the city manager to execute a contract with Jagle Public

251
00:26:44,840 --> 00:26:49,760
 Company for the construction of the McKinney Street/Mayhill intersection project for the

252
00:26:49,760 --> 00:26:54,440
 city of Denton, providing the expenditure of funds, therefore providing an effective

253
00:26:54,440 --> 00:27:03,360
 date award to the company and not to exceed $4,391,631.04.

254
00:27:03,360 --> 00:27:10,320
 Susan, before we get started, Trevor, is someone supposed to be bringing the presentation up

255
00:27:10,320 --> 00:27:15,960
 here on site or do you have the controls remotely?

256
00:27:15,960 --> 00:27:20,960
 I do not. I was told just to call in.

257
00:27:20,960 --> 00:27:29,640
 Okay. All right. Can we take just a five minute break so we can kind of get our act together

258
00:27:29,640 --> 00:27:41,040
 here on site, if that's okay? Could we do that just for a few moments?

259
00:27:41,040 --> 00:27:51,880
 Okay. We're back from our five minute break and we're going on to the item for the McKinney

260
00:27:51,880 --> 00:27:56,440
 Street/Mayhill intersection project. Go ahead, Trevor.

261
00:27:56,440 --> 00:28:02,360
 All right. Good morning. I'm sorry for the mix-up here, but we'll make it work. So y'all

262
00:28:02,360 --> 00:28:08,360
 should be looking at the title slide, the McKinney/Mayhill intersection improvement.

263
00:28:08,360 --> 00:28:15,680
 We can go ahead and go to the second slide. It shows the project overview. This project

264
00:28:15,680 --> 00:28:22,760
 is the actual McKinney Street/Mayhill intersection. It includes traffic control, paving, drainage,

265
00:28:22,760 --> 00:28:27,700
 sidewalks, street lights, traffic signals, pavement markings, and water and wastewater

266
00:28:27,700 --> 00:28:34,520
 improvements. In essence, it's just the actual intersection and about 300 or 600 feet each

267
00:28:34,520 --> 00:28:41,400
 way. It ties in in the middle of the current McKinney Street widening phase 2 project that's

268
00:28:41,400 --> 00:28:49,680
 currently underway. We can move to the next slide. These are the bids that we received.

269
00:28:49,680 --> 00:28:57,560
 We actually got three on this project. To the far left you'll see Hewitt dollars, OPC.

270
00:28:57,560 --> 00:29:02,320
 Jago Public Company was the low bidder. They actually came in a little bit lower than what

271
00:29:02,320 --> 00:29:09,280
 we were looking at, but pretty much right on budget what we were looking at. We can

272
00:29:09,280 --> 00:29:15,280
 move to the next slide. This is our construction schedule. We go to council tomorrow pending

273
00:29:15,280 --> 00:29:23,160
 a decision here. Notice to proceed, we're looking at middle of August and it's a one

274
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 year contract. So we're looking at August 18, 2021 to be completed with this project.

275
00:29:31,260 --> 00:29:35,560
 The next slide is just the recommendation. We recommend adoption of an ordinance accepting

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00:29:35,560 --> 00:29:39,680
 the competitive low bid that award a public works contract for construction on McKinney

277
00:29:39,680 --> 00:29:51,300
 Street/Mayhill intersection project to Jago in the amount of $4,108,575 plus a contingency

278
00:29:51,300 --> 00:30:06,880
 in the amount of $209,125.29. For the total not to exceed amount of $391,631.04. The next

279
00:30:06,880 --> 00:30:13,280
 slide is just the question slide and that's the end of the presentation. I can take any

280
00:30:13,280 --> 00:30:22,040
 questions that anybody has. Barbara, go ahead. Yes. Give me an example of a contingency at

281
00:30:22,040 --> 00:30:28,600
 the city's discretion. What would that be like? So this 5% is something we're starting

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00:30:28,600 --> 00:30:36,600
 to add to contract. It's really just a mechanism for us to do if there's a quantity adjustments

283
00:30:36,600 --> 00:30:44,880
 or change orders that fall underneath so that we don't have to go back to count, these will

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00:30:44,880 --> 00:30:55,240
 be things, you know, some items to that nature. Okay. Thanks, Matt. Yeah, I have a question.

285
00:30:55,240 --> 00:31:03,880
 On the agenda information sheet, it says it makes reference to 600 liner feet. What is

286
00:31:03,880 --> 00:31:15,360
 a liner foot? That's probably a typo. It should be linear feet. I would suggest when we deal

287
00:31:15,360 --> 00:31:20,240
 with something that involves this much money, we have somebody proofread these dimensions

288
00:31:20,240 --> 00:31:27,140
 because I can guess what it means and usually come pretty close, but it should be very clear.

289
00:31:27,140 --> 00:31:35,440
 Another thing, another question. You mentioned 600 linear feet. Is that 600 feet west of

290
00:31:35,440 --> 00:31:42,040
 Mayhill and 600 feet east of Mayhill? Is that what that means? Yes, sir. 600 linear feet

291
00:31:42,040 --> 00:31:52,480
 east and west of the intersection. Okay. Thank you. Yes, sir. Other questions? Do we have

292
00:31:52,480 --> 00:32:06,480
 a motion to approve? I move, we approve. Second. Okay. All in favor say aye. Aye. All right.

293
00:32:06,480 --> 00:32:12,380
 Management reports. Yes, Madam Chair, members of the board, good morning. You have a number

294
00:32:12,380 --> 00:32:17,680
 of attachments in the management report. You've got that. Do you want to wait for Billy? Oh,

295
00:32:17,680 --> 00:32:28,080
 I forgot. Good point, Larry. Yes, Barbara? Charlie asked the question about all the verbiage

296
00:32:28,080 --> 00:32:35,960
 in the agenda and to answer your question, yes, it has been since I was on here another

297
00:32:35,960 --> 00:32:43,760
 time. There's verbiage at the beginning of everyone and Mario maybe cannot tell us why,

298
00:32:43,760 --> 00:32:48,180
 but they consider recommending the adoption of the ordinance, home rule, municipal, blah,

299
00:32:48,180 --> 00:32:58,720
 blah, blah. Why is that at the beginning of every agenda item? It did not feel like that.

300
00:32:58,720 --> 00:33:07,320
 I'm not following your question, Barbara. Okay. At each, on the agenda, each one starts

301
00:33:07,320 --> 00:33:11,520
 off with consider recommending the adoption of the ordinance of the city of Denton at

302
00:33:11,520 --> 00:33:17,160
 Texas home rule municipal corporation or raising the city manager or his designated to execute

303
00:33:17,160 --> 00:33:25,520
 the contract with. And that that verbiage is at the beginning of every item. And what

304
00:33:25,520 --> 00:33:36,160
 is the reason for that? Larry? I can jump in. So, PUB is just making

305
00:33:36,160 --> 00:33:42,480
 a recommendation and it's to comply with the open meetings act about what the PUB is doing.

306
00:33:42,480 --> 00:33:48,080
 So you're considering making a recommendation for council to take an action. We've added

307
00:33:48,080 --> 00:33:54,000
 city of Denton, Texas home rule municipal corporation. That's the official legal description

308
00:33:54,000 --> 00:34:01,000
 of the city. And that's why we've done that. The charter is strange in that Texas in that

309
00:34:01,000 --> 00:34:05,280
 Denton is just known as the city of Denton. It's not known as the city of Denton, Texas.

310
00:34:05,280 --> 00:34:11,460
 And so that's why we go ahead and add all that. Could that be added at the beginning

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00:34:11,460 --> 00:34:20,320
 before before it just said the following items are considered recommending instead of each

312
00:34:20,320 --> 00:34:26,000
 time, because every time, you know, you have to quickly sift through that because oh, yeah,

313
00:34:26,000 --> 00:34:31,120
 they printed that again. Could you just put that once at the beginning of the agenda to

314
00:34:31,120 --> 00:34:37,880
 all items that it applied to and not have to constantly be skipping over that because

315
00:34:37,880 --> 00:34:43,760
 you've already read it on the first, second, third and fourth items?

316
00:34:43,760 --> 00:34:47,880
 We can look at that. The bigger issue is one of complying with the Texas Open Meetings

317
00:34:47,880 --> 00:34:54,800
 Act. One item, one action. And that may look like you're taking like with consent. We're

318
00:34:54,800 --> 00:35:01,080
 able to do that because we're stating on consent. It's all being acted on. We can look at it

319
00:35:01,080 --> 00:35:06,280
 I'll be honest with you. It's always been done that way. And no, we're the first part.

320
00:35:06,280 --> 00:35:10,020
 Well, it's always been done that way since I've been here. And so there may have been

321
00:35:10,020 --> 00:35:15,840
 another way we can certainly look at that. Well, before you were here, it did not. It

322
00:35:15,840 --> 00:35:21,400
 was not done like that. Oh, just saying. Well, I can give you a little brief history.

323
00:35:21,400 --> 00:35:28,120
 There have been council members since I have been here that have wanted to have great detail

324
00:35:28,120 --> 00:35:36,080
 put in the captions that is really way beyond what the Open Meetings Act requires. But that's

325
00:35:36,080 --> 00:35:41,280
 the direction they've asked us to go. And we've accommodated that.

326
00:35:41,280 --> 00:35:49,800
 Understand. All right. Management reports, Murray. All right, I'll start over. Madam

327
00:35:49,800 --> 00:35:54,880
 chair, members of the board. Good morning. You do have a number of items listed and in

328
00:35:54,880 --> 00:36:01,000
 this month, or excuse me, this meetings report, we've got the energy center informal staff

329
00:36:01,000 --> 00:36:05,560
 report and dashboard. I know the board has requested that on a number of occasions. And

330
00:36:05,560 --> 00:36:11,560
 this is the latest version of that. And we've got staff from DME that can respond to those

331
00:36:11,560 --> 00:36:17,720
 questions along with finance if you have any. And then we've got the identity theft prevention

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00:36:17,720 --> 00:36:25,000
 program during the emergency declaration. Got information on that. Krista Foster should

333
00:36:25,000 --> 00:36:30,920
 be on the line to be able to answer any questions that you may have. And then the environmental

334
00:36:30,920 --> 00:36:34,960
 preferred procurement request. That was a request that had been made previously, I believe,

335
00:36:34,960 --> 00:36:40,080
 by Mr. Soph. And we're providing you all what we've done so far. I know that our staff is

336
00:36:40,080 --> 00:36:47,720
 looking over the next coming months to be able to add additional components to the environmental

337
00:36:47,720 --> 00:36:53,080
 preferred procurement policy. So that will be coming forward to the committee on the

338
00:36:53,080 --> 00:36:58,400
 environment here in the near future and then ultimately adoption by city council. As far

339
00:36:58,400 --> 00:37:06,400
 as future agenda items, you have those listed there. And then as far as today, we would

340
00:37:06,400 --> 00:37:12,520
 have been covering items regarding the budget on the utilities. And I believe we are covering

341
00:37:12,520 --> 00:37:19,600
 a few. But the majority of those would be covered next Tuesday, excuse me, next Monday

342
00:37:19,600 --> 00:37:24,920
 on special called meeting. And then lastly, it's just any new business items that we have

343
00:37:24,920 --> 00:37:33,160
 on your report. Any questions that you may have on any of these reports that we can get

344
00:37:33,160 --> 00:37:40,600
 staff on the line for? Yes, I have one. Ed's hands up, too. So we'll go to Ed first, then

345
00:37:40,600 --> 00:37:52,000
 you, then Gerald. I had a question regarding the DEC report. And that question is, in keeping

346
00:37:52,000 --> 00:38:02,440
 with Denton's sustainability goals, is there a policy or initiative in place to offset

347
00:38:02,440 --> 00:38:15,880
 the DEC's greenhouse gas emissions? Terry Nolte will be able to answer that. And I believe

348
00:38:15,880 --> 00:38:25,840
 Ken Banks is on the line as well. Good morning. Terry Nolte, Assistant General Manager. There

349
00:38:25,840 --> 00:38:35,240
 is no current policy at DME with regard to offsetting those carbon emissions. I think

350
00:38:35,240 --> 00:38:45,480
 as the board knows, as 100% renewable supplied utility, the metric that we use for determining

351
00:38:45,480 --> 00:38:53,520
 that 100% renewable is based on the renewable energy credits that we have associated with

352
00:38:53,520 --> 00:39:01,120
 contracted renewable energy resources, those equal the total load that served over the

353
00:39:01,120 --> 00:39:09,200
 year. And therefore, we net to kind of a zero sum game on carbon to serve the load. However,

354
00:39:09,200 --> 00:39:17,280
 we do not have any active program to account for those carbon emissions that take place

355
00:39:17,280 --> 00:39:23,920
 from the DEC. We are looking at a number of technologies. Recently, there's been a lot

356
00:39:23,920 --> 00:39:33,920
 of work on introducing hydrogen into natural gas pipelines as a measure or a means to offset

357
00:39:33,920 --> 00:39:39,440
 some of those carbon emissions. If you combust hydrogen, there are no carbon emissions from

358
00:39:39,440 --> 00:39:48,740
 hydrogen. However, that is in its infancy across the United States. Interestingly, the

359
00:39:48,740 --> 00:40:02,000
 Wurzilla engines at the DEC do have the capability of processing natural gas combined with hydrogen.

360
00:40:02,000 --> 00:40:08,640
 Is there any – do you think, Terry, there's any interest between, say, DME working with

361
00:40:08,640 --> 00:40:18,600
 the sustainability folks in working out some sort of means of offsets until there is a

362
00:40:18,600 --> 00:40:22,280
 technological advance where the emissions are reduced?

363
00:40:22,280 --> 00:40:29,920
 We'd be glad to work with sustainability on what the options are and determine whether

364
00:40:29,920 --> 00:40:37,080
 that's something that the PUB or the council would be willing to pursue and what the cost

365
00:40:37,080 --> 00:40:38,920
 would be.

366
00:40:38,920 --> 00:40:46,800
 I hope you can go forward with that and keep us apprised of any progress.

367
00:40:46,800 --> 00:40:51,000
 All right. Russ, you had a question?

368
00:40:51,000 --> 00:41:00,040
 Yes, I do. On the DEC report, the line item that says insurance, we're spending roughly

369
00:41:00,040 --> 00:41:06,400
 twice the amount budgeted for insurance. And I know part of that – that's a $580,000

370
00:41:06,400 --> 00:41:13,520
 increase, I believe. And part of that is because of the outage insurance we agreed to purchase.

371
00:41:13,520 --> 00:41:21,240
 But I don't remember how much the cost was for that outage insurance.

372
00:41:21,240 --> 00:41:27,400
 My memory – I don't have the exact number – somewhere around $280,000 was the bill

373
00:41:27,400 --> 00:41:33,300
 for that. We did not budget that as an insurance item. We actually budgeted that as a – one

374
00:41:33,300 --> 00:41:41,220
 of the costs of power supply in the Energy Management Office. The balance of the increase

375
00:41:41,220 --> 00:41:50,000
 is due to a very large premium increase in our property and business interruption insurance

376
00:41:50,000 --> 00:41:58,200
 that took place this year. We renew those policies each year. It's premised upon kind

377
00:41:58,200 --> 00:42:06,040
 of the market that's being offered in – for that particular type of service.

378
00:42:06,040 --> 00:42:12,280
 And as I know, Bafford, you've got a background in power generation. So, you know, each year

379
00:42:12,280 --> 00:42:20,100
 the carrier comes out, reviews metrics, performance, and then assesses its reinsurance options

380
00:42:20,100 --> 00:42:26,080
 in the marketplace. And for some reason, this year, across the industry, we've seen about

381
00:42:26,080 --> 00:42:36,120
 a 30 to 40 percent increase in business interruption and property and casualty insurance for these

382
00:42:36,120 --> 00:42:38,040
 types of generating facilities.

383
00:42:38,040 --> 00:42:46,400
 Yeah, I understand that. Given how really few hours we operate those engines compared

384
00:42:46,400 --> 00:42:53,640
 to the total hours in a year, our interruption, I would think, wouldn't be all that much.

385
00:42:53,640 --> 00:42:59,240
 And it's a new facility. So my only suggestion is it might be time to think about shopping

386
00:42:59,240 --> 00:43:07,280
 for some insurance. You ever shop for different carriers?

387
00:43:07,280 --> 00:43:14,160
 In fact, this year we just switched brokers, and that happened during a transition period

388
00:43:14,160 --> 00:43:20,600
 where we – where the risk department was transitioning from one manager to another.

389
00:43:20,600 --> 00:43:28,940
 And the prior insurance carrier provided us a quote. We are currently shopping that property

390
00:43:28,940 --> 00:43:34,920
 and casualty and business interruption insurance. And to the extent we can find a provider that

391
00:43:34,920 --> 00:43:41,640
 would provide us with comparable coverage at a lower rate, under the current trend – the

392
00:43:41,640 --> 00:43:47,560
 current policy, we can seek, and they will reimburse us for the unused portion. So we

393
00:43:47,560 --> 00:43:51,840
 are actively trying to find a way to lower that cost.

394
00:43:51,840 --> 00:43:56,040
 Yeah, that's good. That's all I had on that one.

395
00:43:56,040 --> 00:44:04,880
 Charlie, you had your hand up earlier, right? You're on mute.

396
00:44:04,880 --> 00:44:14,280
 Sorry. Back on the red flags rule briefing, thank you for that. I just wanted to make

397
00:44:14,280 --> 00:44:20,840
 one comment on that. I think our City customer service does an excellent job of balancing

398
00:44:20,840 --> 00:44:28,200
 preventing identity theft and giving customer service to people. I really am grateful for

399
00:44:28,200 --> 00:44:35,080
 the good job they do. I just – as we implement this formally rather than informally, I think

400
00:44:35,080 --> 00:44:41,360
 it's important to remember where identity theft is a risk, perhaps new accounts, and

401
00:44:41,360 --> 00:44:46,480
 where it's probably not a risk, and that we don't add a lot of red tape to our staff

402
00:44:46,480 --> 00:44:52,960
 and to our customers. I think that could be a bad thing as we implement a formal policy

403
00:44:52,960 --> 00:45:01,000
 rather than just good common sense. Thanks. Billy, did you have your hand up? No. Ed,

404
00:45:01,000 --> 00:45:09,040
 did you? Yep, go ahead. I just wanted to request, if it's handy,

405
00:45:09,040 --> 00:45:23,760
 I would like to receive a DEC emissions report that the cumulative amounts of all emissions

406
00:45:23,760 --> 00:45:33,760
 since the plant began operation, would that be possible to receive? Like a year to date

407
00:45:33,760 --> 00:45:40,720
 from the initial operation of the plant when it was first fired up? Absolutely, we can

408
00:45:40,720 --> 00:45:43,200
 certainly do that. Mario, this is Chris Ludrick. I think I can

409
00:45:43,200 --> 00:45:47,680
 answer that question. Please do.

410
00:45:47,680 --> 00:45:55,080
 I didn't know if you could hear me or not. Yes, Mr. So, on our webpage, we have summaries

411
00:45:55,080 --> 00:45:58,600
 from 2018 and 2019. Okay.

412
00:45:58,600 --> 00:46:06,320
 Those emissions on the tonnage are year to date. So, the 2019 annual summary will have

413
00:46:06,320 --> 00:46:09,680
 those figures you're looking for, and if you would like, we could add them together and

414
00:46:09,680 --> 00:46:14,120
 send them to you, but those figures are available on the webpage.

415
00:46:14,120 --> 00:46:17,680
 Okay, thank you, Chris. You're welcome.

416
00:46:17,680 --> 00:46:23,720
 I have a question about the procurement program, too. Is this the right time to ask?

417
00:46:23,720 --> 00:46:30,680
 It's under your environmental preferred? Yes, absolutely. Go ahead.

418
00:46:30,680 --> 00:46:40,840
 Okay. Let me see here. I just want, the first question is, is Staples the sole environmentally

419
00:46:40,840 --> 00:46:51,080
 conscious vendor that the city uses for all its eco products?

420
00:46:51,080 --> 00:46:57,120
 This is Cassie Ogden, well, previous director of procurement and compliance. Yes, the Staples

421
00:46:57,120 --> 00:47:04,800
 is our sole provider of office supplies, and so they do report on those items. We can request

422
00:47:04,800 --> 00:47:11,480
 the report as often as we would like, but we've opted to do the report annually.

423
00:47:11,480 --> 00:47:22,080
 Thank you. Does the city ever issue purchasing requests or send bids out for environmentally

424
00:47:22,080 --> 00:47:29,160
 preferred products, like very often the DME does for when it has construction work done?

425
00:47:29,160 --> 00:47:35,880
 In other words, have you actually, or has the city explored other venues for purchasing

426
00:47:35,880 --> 00:47:43,640
 these products, especially with businesses and distributors who deal exclusively in that

427
00:47:43,640 --> 00:47:50,960
 sort of product? Not to my knowledge, like I said in the memo,

428
00:47:50,960 --> 00:47:57,440
 our purchasing records were very limited prior to 2017. We changed the requirements in 2017

429
00:47:57,440 --> 00:48:01,720
 for the records that we were required to keep and how they were organized. So those were

430
00:48:01,720 --> 00:48:07,380
 the only items that I was able to find. Catherine Barnett might be able to give you some more

431
00:48:07,380 --> 00:48:15,960
 context to that, but we are working to draft a policy, should be coming to you in the fall,

432
00:48:15,960 --> 00:48:21,800
 that will give us more parameters when we do go out to bid on items that we can include

433
00:48:21,800 --> 00:48:26,680
 and kind of give us some targets to hit for those recyclable items.

434
00:48:26,680 --> 00:48:32,440
 Okay. The reason I ask, and I don't know if there's anybody from sustainability on

435
00:48:32,440 --> 00:48:42,340
 the line, but with a program that was instituted in 2007, the results, according to the pie

436
00:48:42,340 --> 00:48:50,640
 charts that are included in the backup material, are not very encouraging in terms of the percentages

437
00:48:50,640 --> 00:48:59,600
 of how much of the product that are supplies that the city uses, furniture, et cetera,

438
00:48:59,600 --> 00:49:06,680
 the small percentage of that, which is eco-friendly. And you can see that in the pie chart that

439
00:49:06,680 --> 00:49:11,320
 provided. So I'm wondering if part of the problem for

440
00:49:11,320 --> 00:49:18,360
 what is clearly perhaps a lack of progress over these 13 years might be the fact that

441
00:49:18,360 --> 00:49:24,360
 the city has been relying on one vendor for all of this and the limitations that could

442
00:49:24,360 --> 00:49:32,120
 be imposed upon possible purchases by the fact that the city is only using one vendor.

443
00:49:32,120 --> 00:49:37,720
 We have Catherine Barnett, she's with sustainability on the line.

444
00:49:37,720 --> 00:49:45,840
 Hi Ed, this is Catherine, sustainability manager. Like Cassie said, they were only able to go

445
00:49:45,840 --> 00:49:52,880
 back and confirm some of the records to 2017. Staples is just our vendor for office supplies,

446
00:49:52,880 --> 00:50:00,640
 so that's just going to be our typical office used paper, those type of items. Now we've

447
00:50:00,640 --> 00:50:06,880
 done green cement, you probably remember that, several years ago we had that whenever we

448
00:50:06,880 --> 00:50:15,520
 were trying to use some of the kilns that had already made the environmental improvements.

449
00:50:15,520 --> 00:50:21,520
 There's an air quality preference that's in some of our bid specs, and then of course

450
00:50:21,520 --> 00:50:27,560
 we have the local preference. So there have been a few bid items, but Staples is just

451
00:50:27,560 --> 00:50:37,200
 a small part of what we do. We've done janitorial supplies that were environmentally preferable.

452
00:50:37,200 --> 00:50:44,880
 And this is, unfortunately we're relying on my memory for some of this, but office supplies

453
00:50:44,880 --> 00:50:50,240
 definitely aren't the only thing that we've done, but there there is room to embed more

454
00:50:50,240 --> 00:50:55,920
 in our policies. Yeah, and as someone mentioned, a forthcoming

455
00:50:55,920 --> 00:51:02,600
 document that's going to flesh out what the policies, what the city's policies are on

456
00:51:02,600 --> 00:51:07,280
 a sustainable procurement program. Is that true? Because as it is now, there's really

457
00:51:07,280 --> 00:51:13,280
 nothing solely dealing with it. It's dealt very, very briefly in the city procurement

458
00:51:13,280 --> 00:51:22,800
 manual on page 61, but there really is no standout document that really outlines everything

459
00:51:22,800 --> 00:51:28,040
 from plastics to air quality, which you know what I'm talking about, and a comprehensive

460
00:51:28,040 --> 00:51:35,320
 document that puts goals and accomplishments in place.

461
00:51:35,320 --> 00:51:39,880
 Yeah, and I can elaborate, that is going to be bringing, being brought forward to the

462
00:51:39,880 --> 00:51:45,000
 Committee on the Environment, that'll go along with the, this is the Simple Sustainability

463
00:51:45,000 --> 00:51:51,040
 Strategy Plan. Along the way, the city has, through city council, has embraced a number

464
00:51:51,040 --> 00:51:57,480
 of new policies like the integrated pest management program. That is a program that is a lot further

465
00:51:57,480 --> 00:52:03,000
 along than what it was before as far as the use of sustainable products out in our fields

466
00:52:03,000 --> 00:52:10,240
 that when we maintain our ball fields, medians, et cetera, and also the utilization of pesticides

467
00:52:10,240 --> 00:52:15,120
 when they're used inside city buildings, et cetera. So the city has come a long way. I

468
00:52:15,120 --> 00:52:20,080
 mean, there is a lot to be done. And quite honestly, you never really arrive because

469
00:52:20,080 --> 00:52:24,320
 the marketplace dictates a lot of these things when it comes to fixtures, when it comes to

470
00:52:24,320 --> 00:52:30,300
 plumbing fixtures, and as a city adopts energy codes, those things have just become much

471
00:52:30,300 --> 00:52:37,520
 more ubiquitous across a lot of different aspects of the, not only the community organization

472
00:52:37,520 --> 00:52:44,520
 itself, but across the community as development occurs. So there's more to come. And so certainly

473
00:52:44,520 --> 00:52:49,720
 we as staff recognize that it's, we've only scratched the surface when it comes to this.

474
00:52:49,720 --> 00:52:55,640
 And so we're also taking a concerted effort to up our game when it comes to these types

475
00:52:55,640 --> 00:53:01,960
 of products and practices. - Thank you. I appreciate that very much.

476
00:53:01,960 --> 00:53:07,280
 - Any other questions? - Yes, I have one.

477
00:53:07,280 --> 00:53:11,800
 - Yes, go ahead, Russ. - Item number five, action items. There's

478
00:53:11,800 --> 00:53:19,240
 an item on there says that today, July 27th, we'd receive some kind of a presentation about

479
00:53:19,240 --> 00:53:29,960
 why our capital budget items that we've identified and funded and budgeted for cannot get done.

480
00:53:29,960 --> 00:53:38,640
 And that was a question I had pre-COVID days. This predates the COVID thing that overwhelmed

481
00:53:38,640 --> 00:53:42,400
 everybody. So I'd just like to follow up on that.

482
00:53:42,400 --> 00:53:46,160
 - Are you talking about item number four on the capital utilities?

483
00:53:46,160 --> 00:53:52,800
 - Yes. Let's see. Yeah, the one that's got my name by it.

484
00:53:52,800 --> 00:53:58,320
 - Sure. That would have been presented today as part of your budget overview. However,

485
00:53:58,320 --> 00:54:03,420
 it's not scheduled today. It'll be scheduled next Monday. You all have a special call meeting

486
00:54:03,420 --> 00:54:09,160
 next Monday to go over all the utility budgets. So with that will be a presentation that gives

487
00:54:09,160 --> 00:54:14,660
 you an overview of the progress on our capital improvement plan for the utilities.

488
00:54:14,660 --> 00:54:17,080
 - Thank you. - You heard your hand up.

489
00:54:17,080 --> 00:54:24,680
 - I did. Item one on the new business action items. About four and a half months ago, I

490
00:54:24,680 --> 00:54:30,940
 requested a briefing on a lawsuit lost by the city of Denton involving the determination

491
00:54:30,940 --> 00:54:37,840
 of two DME employees. Nothing's happened since I requested the briefing. Barbara kindly brought

492
00:54:37,840 --> 00:54:44,040
 it up last meeting and still nothing has happened. If staff thinks this request is outside of

493
00:54:44,040 --> 00:54:49,880
 the PUB's purview, or if it's best handled in a closed meeting, that's fine. Just say

494
00:54:49,880 --> 00:54:56,280
 so. However, we're dealing with an enormous lawsuit with implications both to DME personnel

495
00:54:56,280 --> 00:55:01,660
 and to the budget. So I think it's both relevant and time sensitive. And I would ask staff

496
00:55:01,660 --> 00:55:10,680
 to respond at the next meeting. - Okay. Larry, do you want to say anything?

497
00:55:10,680 --> 00:55:15,560
 - At this point, we can probably put something together.

498
00:55:15,560 --> 00:55:22,560
 - We'll put something together. - Thank you. Any other questions? All right.

499
00:55:22,560 --> 00:55:28,000
 On to concluding items. Does a board member wish to have anything added to a future agenda

500
00:55:28,000 --> 00:55:36,440
 or have comments for staff? - What Charlie's comments and questions just

501
00:55:36,440 --> 00:55:44,880
 work as far as that goes. The DME employee situation is starting to go in that category

502
00:55:44,880 --> 00:55:50,680
 better than where we were. - Yeah. I would like to congratulate Mario

503
00:55:50,680 --> 00:55:55,520
 and thank you for his service to Denton. You'll be missed.

504
00:55:55,520 --> 00:55:57,720
 - Thank you. - Their gain is our loss.

505
00:55:57,720 --> 00:56:01,080
 - Well, I appreciated this. It's going to be my last PUB meeting, even though you do

506
00:56:01,080 --> 00:56:07,360
 have a special call one, but we'll miss staff and certainly the board and appreciate all

507
00:56:07,360 --> 00:56:12,440
 your, certainly your patience today and past meetings when we've had issues brought before,

508
00:56:12,440 --> 00:56:16,480
 you appreciate your professionalism and just your ability to support city staff and city

509
00:56:16,480 --> 00:56:23,660
 operations. With that being said, at the next meeting, Tony Puente will be the staff liaison

510
00:56:23,660 --> 00:56:29,920
 between the city and the public utilities board. You know Tony well, so it's a familiar face.

511
00:56:29,920 --> 00:56:34,160
 And so I know he'll do a great job. - Best wishes to you.

512
00:56:34,160 --> 00:56:36,920
 - Thank you very much. - Yes. Mario, for those of us who live in

513
00:56:36,920 --> 00:56:42,980
 the dark sometimes, where are you going? - Well, I will be, I have been appointed the

514
00:56:42,980 --> 00:56:48,240
 city manager of Nacogdoches, Texas, which is in East Texas. I went to college and I'm

515
00:56:48,240 --> 00:56:54,200
 from the Dallas-Fort Worth area, but I went to undergrad as Stephen F. Austin. And so

516
00:56:54,200 --> 00:56:57,960
 I'll be being their next city manager starting August 10th.

517
00:56:57,960 --> 00:57:00,320
 - Great, congratulations. - Appreciate it.

518
00:57:00,320 --> 00:57:06,360
 - So you're going to be lumberjack, right? - Go Jacks, go Jacks. Yes, ma'am.

519
00:57:06,360 --> 00:57:09,120
 - Good luck. - Thank you.

520
00:57:09,120 --> 00:57:13,160
 - All right, so now we're going into work session. We're going to receive a report,

521
00:57:13,160 --> 00:57:19,920
 hold a discussion and give direction regarding the electric fiscal year 2021 proposed budget

522
00:57:19,920 --> 00:57:24,400
 capital improvement program and the five-year financial summary.

523
00:57:24,400 --> 00:57:32,680
 - Good morning, PB members, chairs, Nick Benson, assistant director of finance. Can you hear

524
00:57:32,680 --> 00:57:34,160
 me okay? - Yes.

525
00:57:34,160 --> 00:57:39,880
 - Perfect. Let me get the presentation pulled up and then I'll do a quick introduction to

526
00:57:39,880 --> 00:57:44,240
 Tony who will take over the operational discussion of the presentation. But to facilitate the

527
00:57:44,240 --> 00:57:47,720
 online meeting, we've actually broken the discussion up into two parts. The first part

528
00:57:47,720 --> 00:57:52,400
 of the presentation will be an operating discussion to cover really the goals and accomplishments

529
00:57:52,400 --> 00:57:56,920
 of the electric department. About halfway through, there will be a slide to allow for

530
00:57:56,920 --> 00:58:02,120
 questions. You can ask Tony any questions that you may have regarding the operations.

531
00:58:02,120 --> 00:58:05,840
 After it gets done, I'll come back up and present the financial portion of the presentation,

532
00:58:05,840 --> 00:58:10,560
 and then of course we'll finish out with questions regarding the financial section. A couple

533
00:58:10,560 --> 00:58:14,120
 of things. When you read to the financial presentation today, this is an abbreviated

534
00:58:14,120 --> 00:58:18,200
 presentation of the budget. Our full intent is to circle back to the public utility board

535
00:58:18,200 --> 00:58:22,520
 this winter in November and December to have a detailed budget discussion with both the

536
00:58:22,520 --> 00:58:27,800
 public utility board and city council. This will allow us time to have those high revenue

537
00:58:27,800 --> 00:58:31,680
 months for the utilities of July and August. So actually this is July, but we'll also have

538
00:58:31,680 --> 00:58:37,640
 August also and fully understand the COVID impact to the city utilities to further those

539
00:58:37,640 --> 00:58:43,760
 discussions with both the PB and city council. With that, I'll turn it over to Tony and he

540
00:58:43,760 --> 00:59:02,280
 will take the presentation over. Oh, let me go back. Sorry about that. I just realized

541
00:59:02,280 --> 00:59:05,320
 you couldn't see me. So now you can't see me. Hang on a second. I'll turn it over to

542
00:59:05,320 --> 00:59:31,240
 Tony. We can't hear you, Tony. Here we go. So Madam Chair and members of the PB, some

543
00:59:31,240 --> 00:59:35,480
 of the changes in the organization, I recently assumed the position of executive manager

544
00:59:35,480 --> 00:59:41,800
 of utilities. And so I'll be providing management oversight of all the utilities as well as

545
00:59:41,800 --> 00:59:46,920
 being the liaison to the sports. I certainly look forward to that. But with those changes,

546
00:59:46,920 --> 00:59:50,560
 I will continue to serve as the DME general manager. And that's the reason why I'm doing

547
00:59:50,560 --> 00:59:55,000
 the presentation today. Obviously Terry Nolte is also in the room in case I get into any

548
00:59:55,000 --> 00:59:59,240
 trouble, or there's any questions that you may have. So with that, I'll go ahead and

549
00:59:59,240 --> 01:00:08,920
 shift over to the presentation and get the operational component going. So the first

550
01:00:08,920 --> 01:00:14,400
 thing that I want to say before we get started, obviously this past year has been a challenging

551
01:00:14,400 --> 01:00:19,160
 one. I certainly want to thank all our staff for all the work that they've done. Really

552
01:00:19,160 --> 01:00:24,920
 unprecedented times, as you know, across not just the utilities, but our state or city

553
01:00:24,920 --> 01:00:29,680
 and certainly the country. But I do want to thank them for all the work they've done.

554
01:00:29,680 --> 01:00:34,280
 I will report to you that our staff is in good shape. We've been able to continue to

555
01:00:34,280 --> 01:00:40,880
 keep the lights on and serve the community. And as well, through this process, we also

556
01:00:40,880 --> 01:00:45,800
 had the opportunity, if you want to call it that, to respond to a F-1 tornado that tore

557
01:00:45,800 --> 01:00:51,440
 through downtown Bowie. And so we provided mutual aid during that time. And so I really

558
01:00:51,440 --> 01:00:57,320
 just want to thank Brad Watts and some of our other line operations staff that responded

559
01:00:57,320 --> 01:01:02,560
 to that. And just let me say that there was no shortage of volunteers. The staff has been

560
01:01:02,560 --> 01:01:08,080
 very responsive to those situations where we respond to mutual aid. And so I just report

561
01:01:08,080 --> 01:01:12,480
 to you that we continue to do that. And we're happy to help out our neighbors through that,

562
01:01:12,480 --> 01:01:16,320
 because again, we never know when we may need that same kind of help. So I just want to

563
01:01:16,320 --> 01:01:20,160
 thank them for all the work they've done over the last year. So I want to go through just

564
01:01:20,160 --> 01:01:24,000
 a couple of these accomplishments and goals. Certainly, I'm not going to cover every single

565
01:01:24,000 --> 01:01:29,960
 one of these. But the one that I wanted to point out is number two that you see on there.

566
01:01:29,960 --> 01:01:34,720
 And we did a lot of work over the last year with the Hunter and Coal Ranch developments.

567
01:01:34,720 --> 01:01:42,040
 I'll report to you that every location where we could serve that development, if it was

568
01:01:42,040 --> 01:01:52,960
 monthly certified, we were... What's that? The presentation isn't up on the screen. All

569
01:01:52,960 --> 01:02:11,880
 right. Sorry about that. It's okay. Rookie mistake. Sorry about that. So as I said, with

570
01:02:11,880 --> 01:02:17,700
 the Hunter and Coal Ranch, every area that was available for us to serve, we did get

571
01:02:17,700 --> 01:02:22,720
 a commitment, a contract commitment for those developers to serve that area. We estimate

572
01:02:22,720 --> 01:02:28,080
 that's going to be about four to 6,000 new customers over that build out period. Now,

573
01:02:28,080 --> 01:02:34,200
 that is a 30-year build out period. But through those negotiations, we were also able to...

574
01:02:34,200 --> 01:02:42,360
 Over 10 acres that were donated to the city that we are working through the title transfer.

575
01:02:42,360 --> 01:02:47,920
 That property will be utilized to site the Underwood substation, which will primarily

576
01:02:47,920 --> 01:02:53,960
 serve that development, but certainly that area as we continue to expand that southwest

577
01:02:53,960 --> 01:03:01,920
 sector of the city. The next item that I wanted to talk about is there on number three. And

578
01:03:01,920 --> 01:03:05,600
 I'll talk a little bit more about this when we get into the FT accounts, but we continue

579
01:03:05,600 --> 01:03:10,400
 to look at our organization. We had an external review that was done and we've been restructuring

580
01:03:10,400 --> 01:03:19,900
 DME over the last year. Currently, in this phase one, we've concentrated on our engineering

581
01:03:19,900 --> 01:03:26,440
 department and also our metering department. Certainly, the voluntary separation program

582
01:03:26,440 --> 01:03:33,240
 has also assisted in helping us take a look at our organization and where FT's are found

583
01:03:33,240 --> 01:03:41,360
 and try just to be more efficient, more conscious of our labor costs. And so that is something

584
01:03:41,360 --> 01:03:46,440
 that we've done. We no longer have two separate engineering groups. We've combined those into

585
01:03:46,440 --> 01:03:50,880
 a single engineering group under a single manager. And also we've made some changes

586
01:03:50,880 --> 01:03:55,760
 and continue to look for some additional changes over the next year, year and a half in our

587
01:03:55,760 --> 01:04:01,800
 metering shop. Currently, we provide water metering services for our water department.

588
01:04:01,800 --> 01:04:07,840
 And so we're looking at potential transitions, looking at technology that could further reduce

589
01:04:07,840 --> 01:04:12,420
 some of the headcount or at least transfer the headcount over to the water department.

590
01:04:12,420 --> 01:04:17,200
 The last item that I'll kind of touch base with you is number seven on here is that's

591
01:04:17,200 --> 01:04:22,160
 the achieving the 100% renewable power supplies. You know, we had a lot of discussions with

592
01:04:22,160 --> 01:04:27,800
 the PAB and certainly with the council. Terry Nolte kind of led us through those discussions.

593
01:04:27,800 --> 01:04:35,940
 But I'll report to you that based on the Denton renewable plan, resource renewable plan, we

594
01:04:35,940 --> 01:04:43,320
 will be 100% renewable under contract by the end of this year. So we will, and we have

595
01:04:43,320 --> 01:04:49,320
 a slide after this that will just talk a little bit more about kind of where we are as far

596
01:04:49,320 --> 01:04:56,760
 as those goals. Future goals. So we want to talk a little bit about number three here.

597
01:04:56,760 --> 01:05:03,120
 So we continue to look for additional opportunities for, you know, short term and long term PPAs.

598
01:05:03,120 --> 01:05:08,880
 Currently have three RFPs that that are being evaluated. We anticipate bringing those back

599
01:05:08,880 --> 01:05:14,620
 to the PAB and then the council sometime in August, maybe towards the end of August. Those

600
01:05:14,620 --> 01:05:22,840
 include additional coastal wind, solar, and also a smaller solar with battery. We're currently,

601
01:05:22,840 --> 01:05:27,960
 like I said, evaluating those and we will be bringing that back to you for consideration.

602
01:05:27,960 --> 01:05:34,680
 Again, that will help us as some of our other contracts begin to roll off in 2024, that

603
01:05:34,680 --> 01:05:42,460
 these will then come online so that we continue with that 100% goal in mind. And then finally,

604
01:05:42,460 --> 01:05:49,760
 I'll touch base on number six. So next to our people, data is our next biggest resource.

605
01:05:49,760 --> 01:05:54,720
 We continue to look at our metering data. DME spent a lot of money over the last few

606
01:05:54,720 --> 01:06:02,200
 years to automate our meters. And so making sure that we have access to that interval

607
01:06:02,200 --> 01:06:10,320
 data will not just help our EMO in purchasing power for our customers, but certainly be

608
01:06:10,320 --> 01:06:16,920
 able to give us some additional rate opportunities to offer time of use rates and other types

609
01:06:16,920 --> 01:06:22,040
 of rates to our customers, as well as giving them more access and more control to their

610
01:06:22,040 --> 01:06:27,720
 consumption in their residence. And so that's certainly something that we look forward to.

611
01:06:27,720 --> 01:06:33,440
 We've been working towards already, but we anticipate that going into next year we'll

612
01:06:33,440 --> 01:06:40,000
 continue to make progress. So just some philosophical changes. Certainly over the last year, we've

613
01:06:40,000 --> 01:06:48,560
 been focusing on reducing rate pressures. We've looked at our capital improvement program.

614
01:06:48,560 --> 01:06:54,120
 As you may recall, that for the current year, we did reduce the amount of debt that we issued

615
01:06:54,120 --> 01:07:00,160
 by about $10 million. That was really just taking a fresh look at the CIP program that

616
01:07:00,160 --> 01:07:07,240
 was in place. We'll continue to do that in the next year. And so we anticipate that if

617
01:07:07,240 --> 01:07:12,200
 there are opportunities for us to put off some things, maybe do things a little bit

618
01:07:12,200 --> 01:07:17,080
 differently, reevaluate some of our projects, we'll continue to do that. One of the examples

619
01:07:17,080 --> 01:07:23,200
 that I'll put out there that we've discussed is with the two GIS substations that we're

620
01:07:23,200 --> 01:07:31,120
 planning, the Hickory GIS substation, the Eagle. We made a recommendation that taking

621
01:07:31,120 --> 01:07:37,440
 a fresh look at the Eagle substation, we think that that substation may be somewhat premature,

622
01:07:37,440 --> 01:07:44,680
 and so we anticipate about $17 million in deferred cost by not doing that substation.

623
01:07:44,680 --> 01:07:48,640
 But we do anticipate a little bit of additional cost on the Hickory substations to be able

624
01:07:48,640 --> 01:07:54,320
 to serve the UNT load. That's something that we continue to have conversations and anticipate

625
01:07:54,320 --> 01:08:00,040
 having conversations with the University of North Texas as well. The other item on here

626
01:08:00,040 --> 01:08:05,080
 is just evaluating distributed generation policies. As you know, we've come to you

627
01:08:05,080 --> 01:08:10,000
 and also with the council to discuss our rooftop solar program, both on the rebate side and

628
01:08:10,000 --> 01:08:14,840
 also on the utility side. We've gotten some good information. We're doing some additional

629
01:08:14,840 --> 01:08:19,520
 research based on the questions that we've gotten, and we anticipate coming back to you

630
01:08:19,520 --> 01:08:26,040
 probably sometime next month to continue to have those conversations on where we may go

631
01:08:26,040 --> 01:08:33,140
 with those types of policies. And then finally, certainly as a result of the current pandemic,

632
01:08:33,140 --> 01:08:38,560
 we've had some opportunities to look at telecommuting in our organization. And so if you walk onto

633
01:08:38,560 --> 01:08:44,080
 the DME campus today, you'll find that there's a lot of buildings with not a lot of people

634
01:08:44,080 --> 01:08:48,680
 in them. And so we have a lot of folks that are working from home and have been doing

635
01:08:48,680 --> 01:08:55,080
 so very effectively. And so we've seen no impacts to our service level, certainly not

636
01:08:55,080 --> 01:08:59,400
 as a result of that telecommuting. As a matter of fact, I think we've had a lot more productivity

637
01:08:59,400 --> 01:09:04,240
 from our staff as a result of them being able to work from home. And so we'll continue to

638
01:09:04,240 --> 01:09:10,960
 evaluate that and continue to look at what spaces we may have currently at DME. We certainly

639
01:09:10,960 --> 01:09:16,160
 have some needs, certainly for our operational folks by way of locker rooms and restrooms

640
01:09:16,160 --> 01:09:20,520
 and other adequate training areas. So we'll be looking at that over the next year, but

641
01:09:20,520 --> 01:09:26,480
 certainly the pandemic is forced us to look at these sorts of things. And so it is one

642
01:09:26,480 --> 01:09:33,520
 of the positive things, if you will, that's come out of the current challenges. So just

643
01:09:33,520 --> 01:09:38,840
 a couple of metrics that I'll cover. This is certainly, I already spoke about the renewable

644
01:09:38,840 --> 01:09:47,800
 energy and this is really how do we sustain that goal going out beyond even 2023. So as

645
01:09:47,800 --> 01:09:52,600
 I mentioned earlier, we've already achieved the goal that's outlined in the Renewable

646
01:09:52,600 --> 01:10:00,000
 Plan, but certainly being able to sustain that over the long haul. We do have the lawn

647
01:10:00,000 --> 01:10:05,320
 draw project that has been somewhat delayed, but we anticipate that there will be back

648
01:10:05,320 --> 01:10:10,720
 online and certainly they've had some challenges with getting materials from China and other

649
01:10:10,720 --> 01:10:17,640
 places and so, but we anticipate that that project will be back on schedule. And then

650
01:10:17,640 --> 01:10:21,480
 the other item that I'll mention, which is one that we've talked with you about is the

651
01:10:21,480 --> 01:10:28,600
 Whitetail contract. That contract will expire in December of 2023 and so that is the reason

652
01:10:28,600 --> 01:10:34,680
 for the current RFPs that we have, that we're currently evaluating. Our hope is to be able

653
01:10:34,680 --> 01:10:41,480
 to have something in place so that when Whitetail expires, it will have a new resource in place

654
01:10:41,480 --> 01:10:51,600
 to continue down the path of 100% renewable or more. And as I mentioned earlier, we did

655
01:10:51,600 --> 01:10:59,720
 issue a smaller five megawatt RFP for a solar project that's combined with battery storage.

656
01:10:59,720 --> 01:11:05,440
 We would anticipate that that would be located somewhere in the city. We've had positive

657
01:11:05,440 --> 01:11:09,460
 conversations with the University of North Texas as a property that they may have and

658
01:11:09,460 --> 01:11:15,520
 so we'll continue to evaluate that and be ready to discuss that with you in more detail

659
01:11:15,520 --> 01:11:22,280
 over the next month or so. You know, certainly one of the things that we're very proud of

660
01:11:22,280 --> 01:11:28,260
 is DME's reliability. As you can see here and this national average is a little dated,

661
01:11:28,260 --> 01:11:33,720
 but again I think it's a good measuring stick for us. The national average is about 139

662
01:11:33,720 --> 01:11:38,360
 minutes worth of outage. As you can see over the last four years, we've certainly been

663
01:11:38,360 --> 01:11:47,880
 well below that. 2019, our average outage was about 39 minutes and so certainly if you

664
01:11:47,880 --> 01:11:53,560
 are a DME customer, you know that there's very few times that your electricity is out

665
01:11:53,560 --> 01:11:59,400
 and when it is out, we get you back up in pretty short order. So we're very proud of

666
01:11:59,400 --> 01:12:07,320
 this reliability measure. It is something that we're recognized routinely for our accomplishments

667
01:12:07,320 --> 01:12:13,880
 there. And then competitive rates, this is a little bit dated. As Nick mentioned, we

668
01:12:13,880 --> 01:12:19,440
 will be coming back to you in November after we've closed out the fiscal year and having

669
01:12:19,440 --> 01:12:26,000
 a much broader discussion with you about where we are financially. Certainly the month of

670
01:12:26,000 --> 01:12:33,480
 August and September are busy months, both from a demand standpoint, but also we're hopeful

671
01:12:33,480 --> 01:12:40,400
 that also for that the deck is up and running during that time period. And so we think that

672
01:12:40,400 --> 01:12:43,760
 making sure that we have a closed out year to be able to have a good discussion with

673
01:12:43,760 --> 01:12:48,480
 the PV and with the council about rates, but kind of based on where we are and where we've

674
01:12:48,480 --> 01:12:56,120
 been, I think historically we've been about the midpoint when we compare to some of the

675
01:12:56,120 --> 01:13:02,200
 other municipally owned utilities, we're now recommending any changes to our base rate.

676
01:13:02,200 --> 01:13:10,200
 So $124.80, which is the average over that 12 month period is where we anticipate remaining

677
01:13:10,200 --> 01:13:14,880
 going forward, at least to the beginning of the fiscal year. And certainly we'll evaluate

678
01:13:14,880 --> 01:13:23,880
 that going after that in November. And this is just comparison to other municipally owned

679
01:13:23,880 --> 01:13:30,480
 utilities, we'll refresh this data for you in November and as well as comparing it to

680
01:13:30,480 --> 01:13:41,920
 some of the private IOUs as well. So the next item here is our FTE summary. As you can see,

681
01:13:41,920 --> 01:13:51,760
 I did want to point out that the total for FY 2021 is actually 169 FTEs. And so if you

682
01:13:51,760 --> 01:14:02,120
 compare that from our 19-20, that's a 20 FTE reduction. I did go back and I looked in FY

683
01:14:02,120 --> 01:14:10,520
 17-18 as an example, we were at 199 FTEs. Now 10 of those FTEs were related to a transfer

684
01:14:10,520 --> 01:14:18,120
 of a tech operation, a tech services operation. And so the cost is still embedded as a transfer

685
01:14:18,120 --> 01:14:24,880
 for DME, but the FTEs don't show up here. Some of these positions that have been reduced

686
01:14:24,880 --> 01:14:31,000
 were directly related to the voluntary separation program. Some of those positions we've not

687
01:14:31,000 --> 01:14:38,120
 requested to refill. A couple of examples, we had a superintendent that oversaw our metering

688
01:14:38,120 --> 01:14:45,280
 division. We've opted to not refill that position and instead, we'll have a manager that is

689
01:14:45,280 --> 01:14:51,560
 already in the division that will continue to run that. But that superintendent will

690
01:14:51,560 --> 01:14:56,280
 not be replaced. I already mentioned to you that we've combined our two engineering groups.

691
01:14:56,280 --> 01:15:00,680
 We had a transmission engineering group and a distribution engineering group. We've now

692
01:15:00,680 --> 01:15:06,480
 combined those under a single engineering manager. That would be Jerry Fiedler, but

693
01:15:06,480 --> 01:15:12,440
 we've not refilled the other position. So those are just a couple of examples, but certainly

694
01:15:12,440 --> 01:15:19,480
 we have a reconciliation of those 20 positions across DME. We think that based on the FTE

695
01:15:19,480 --> 01:15:25,920
 accounts that we have going into 2021, that we'll be in good shape. Certainly if things

696
01:15:25,920 --> 01:15:32,480
 change, if there's service issues that we run against or other demands, we'll be happy

697
01:15:32,480 --> 01:15:37,800
 to come back to the PB and to the council and justify additional FTEs either mid-year

698
01:15:37,800 --> 01:15:44,600
 or going into 21, 22. But currently with the 169 FTEs, we feel pretty comfortable going

699
01:15:44,600 --> 01:15:53,360
 into that year as far as labor. And then just briefly, my final slide here is just what

700
01:15:53,360 --> 01:15:59,760
 the current organizational chart looks like. As you know, Terry Nolte is our assistant

701
01:15:59,760 --> 01:16:05,600
 general manager. He oversees a number of areas, including our safety and training program

702
01:16:05,600 --> 01:16:12,960
 that we are working to revamp and working with the city as well through an outside contract.

703
01:16:12,960 --> 01:16:18,400
 And over the next six months, we'll continue to evaluate that program and our needs. And

704
01:16:18,400 --> 01:16:24,000
 then we have Chris Lutrick, who's our executive manager of energy services. And among the

705
01:16:24,000 --> 01:16:29,900
 things that Chris oversees currently is the metering division. Again, working closely

706
01:16:29,900 --> 01:16:37,240
 with those folks to really make improvements in that area. And I'll mention as well, Terry

707
01:16:37,240 --> 01:16:41,160
 also oversees our engineering group and is working very closely with them as we continue

708
01:16:41,160 --> 01:16:47,840
 to merge those two divisions. And then some of the other folks that we have on here, currently

709
01:16:47,840 --> 01:16:53,040
 Smith Day oversees most of our cyber and physical security, our risk management office, and

710
01:16:53,040 --> 01:16:58,080
 also we've recently combined our administrative assistance into an administrative pool to

711
01:16:58,080 --> 01:17:04,920
 provide better service across all our divisions of DME. And then presently, the line operations

712
01:17:04,920 --> 01:17:12,160
 groups under Brad Watts and Rowdy Patterson and also our substation group under Sam Bridges,

713
01:17:12,160 --> 01:17:17,200
 they currently report to me as the general manager. I will tell you that over the next

714
01:17:17,200 --> 01:17:25,760
 few weeks, we'll be looking at this organization as I look at across all our utilities on where

715
01:17:25,760 --> 01:17:31,560
 my time need to be spent. And so we may update this chart in the next few weeks. If we do

716
01:17:31,560 --> 01:17:38,000
 that, we'll get that back out to you. So you're aware on what the organizational chart will

717
01:17:38,000 --> 01:17:46,640
 look like going forward. So with that, that concludes my portion of the operational section

718
01:17:46,640 --> 01:17:54,400
 and I'm happy to answer any questions or we can certainly go to the financial section

719
01:17:54,400 --> 01:18:06,360
 with Nick. Madam Chair, what is your pleasure? You'll need to minimize the presentation,

720
01:18:06,360 --> 01:18:15,240
 Tony. I'm trying to do that. I think people do already have questions and I want to note

721
01:18:15,240 --> 01:18:22,280
 that Billy Cheek needed to hop off. He had a 1030 meeting, so I should make sure that's

722
01:18:22,280 --> 01:18:31,480
 in the minutes. Okay, Charlie, you had your hand up first. Quick question on the employment

723
01:18:31,480 --> 01:18:41,480
 summary on page six. I see that you have 189 full-time equivalent employees right now and

724
01:18:41,480 --> 01:18:51,840
 then the vacant of 43. Does that mean you have 43 places you could fill, making it 232?

725
01:18:51,840 --> 01:19:02,560
 Or does that mean that you currently have 146 employees? So we have 189 positions budgeted.

726
01:19:02,560 --> 01:19:11,280
 Got it. Going into this, we had 43 vacancies, but we've refilled 19 of those vacancies.

727
01:19:11,280 --> 01:19:19,320
 And so the difference there, that's what 165. Okay. That's correct. So going into next fiscal

728
01:19:19,320 --> 01:19:26,280
 year, 165, that's what we anticipate having as far as labor. Okay. So the labor is essentially

729
01:19:26,280 --> 01:19:33,960
 a no change. From where we are currently, that's correct. But from the budget, it is

730
01:19:33,960 --> 01:19:42,480
 a reduction of 20 FTEs. Absolutely. Thank you. Yes, sir. Russ, go ahead. Yes, 20. In

731
01:19:42,480 --> 01:19:48,720
 looking at the utility rate cost per megawatt hour graph that you had up there, I think

732
01:19:48,720 --> 01:19:59,000
 on slide five, something like that, I noticed that Garland and Bryan had lower rates than

733
01:19:59,000 --> 01:20:04,960
 the city of Denton. And Garland and Bryan were also in the Texas municipal power agency,

734
01:20:04,960 --> 01:20:11,120
 correct? That's correct. So what I'm wondering is, do you know, maybe there's no answer to

735
01:20:11,120 --> 01:20:16,160
 this right now. I don't want to belabor the point, but do you know why their average rates

736
01:20:16,160 --> 01:20:22,040
 are lower than ours? Well, certainly, I think, you know, one of the explanations is they

737
01:20:22,040 --> 01:20:28,040
 have more customers than we do. And so they have a much broader base for them to spread

738
01:20:28,040 --> 01:20:32,880
 their costs and be able to have lower rates. But they also have a slightly different operation

739
01:20:32,880 --> 01:20:37,080
 when it comes to EML and their QSC services. And so they have a little bit more diversity

740
01:20:37,080 --> 01:20:42,480
 and in some of their non base rate revenue that comes into their utility, that also helps

741
01:20:42,480 --> 01:20:48,120
 prop some of those base rates down for those utilities. We can certainly take a closer

742
01:20:48,120 --> 01:20:52,120
 look at that. And then when we come back in November, we can certainly give you a little

743
01:20:52,120 --> 01:20:56,680
 bit more insights into why that may be. Okay, thank you. Yes, sir.

744
01:20:56,680 --> 01:21:05,000
 Any other questions? I have one, Tony. Can you remind me what the percentage of our underground

745
01:21:05,000 --> 01:21:12,440
 electric, I mean, that always helps with our outage management. So hold on, I'm looking

746
01:21:12,440 --> 01:21:19,920
 at Terry, see if Terry, Terry has that percentage. I don't have the exact percentage. Just approximate,

747
01:21:19,920 --> 01:21:27,400
 you know? Yeah, it's about, I think it's about 40% underground. About 20%? 40. About 40%.

748
01:21:27,400 --> 01:21:33,400
 Okay. All right. And then as we're developing, we're doing underground. And any new developments

749
01:21:33,400 --> 01:21:38,600
 are required to have underground, yes ma'am. So all of Hunter Cole Ranch will, as an example,

750
01:21:38,600 --> 01:21:44,080
 will all be underground. Okay. All right. Thank you. I guess there's no other questions.

751
01:21:44,080 --> 01:22:02,080
 Okay, with that, I'll turn it over to Nick. Thank you, Tony. Pull this back up. All right.

752
01:22:02,080 --> 01:22:11,680
 Can everybody see that? Yes. Okay. So real quick, we'll go over the financial assumptions

753
01:22:11,680 --> 01:22:16,500
 that are currently covered in this five-year forecast. Be certain. I can answer questions

754
01:22:16,500 --> 01:22:20,080
 at the end if you have any when we get that slide. I think there's four or five slides

755
01:22:20,080 --> 01:22:23,120
 to cover the financials. And like I said, we'll circle back in November, December with

756
01:22:23,120 --> 01:22:27,920
 a detailed budget discussion for DME. So on the revenue side, we are currently, we do

757
01:22:27,920 --> 01:22:34,840
 have a low growth of 3.2% forecasted for the five-year period. Our T-cost allowed rate

758
01:22:34,840 --> 01:22:42,400
 of return. We are currently showing a 28.04% through 2022. To be conservative, we are showing

759
01:22:42,400 --> 01:22:48,440
 this to decrease to 16% starting in 2023 through 2025. And I'll review that with you on the

760
01:22:48,440 --> 01:22:54,400
 five-year forecast here shortly. Expenses, we do have the ROI. So city council recently

761
01:22:54,400 --> 01:23:01,400
 approved rate of return increased to 3.5% to 6% for the electric utility to transfer

762
01:23:01,400 --> 01:23:05,600
 to the general fund. I'll review this with you on the forecast here shortly. And this

763
01:23:05,600 --> 01:23:11,720
 does account for about 11.7 million over the five-year period. We are not forecasting any

764
01:23:11,720 --> 01:23:17,240
 sale to Gibbons Creek facility. We do have some money built in for the decommissioning

765
01:23:17,240 --> 01:23:22,020
 of that site over the five-year period. That does make up $21 million. It's currently included

766
01:23:22,020 --> 01:23:27,920
 in purchase power. And then ultimately, Tony reviewed the position changes with you. That

767
01:23:27,920 --> 01:23:35,280
 does account for 1.7 million in savings starting in 2021.

768
01:23:35,280 --> 01:23:38,600
 This is the five-year forecast for the electric fund. I will do my best to walk you through

769
01:23:38,600 --> 01:23:45,240
 this from the left-hand side. You can see the adopted 2020 budget here in this column.

770
01:23:45,240 --> 01:23:51,600
 We did have budget use of reserves of $6.9 million. As you move down the page, you can

771
01:23:51,600 --> 01:23:56,360
 see, of course, we had no rate increase included in the adopted budget. Finally, down here

772
01:23:56,360 --> 01:24:01,720
 in the yellow, you can see what we were forecasting the reserves to be at the end of the fiscal

773
01:24:01,720 --> 01:24:08,280
 or the beginning of the fiscal year, so when we adopted the 2020 budget of $48.6. Moving

774
01:24:08,280 --> 01:24:12,040
 to your right here, you can see the estimate column of 2020. We are forecasting to use

775
01:24:12,040 --> 01:24:17,120
 a little bit less than reserves, about $3.4 million. So coming in a little bit better

776
01:24:17,120 --> 01:24:22,120
 than we originally budgeted. Still see no rate increases. We are forecasting a little

777
01:24:22,120 --> 01:24:29,720
 bit better ending fund balance of $73.2 million coming in this fiscal year. And then finally,

778
01:24:29,720 --> 01:24:34,160
 here in the dotted line, you can see the proposed 2021 budget. We are not forecasting to use

779
01:24:34,160 --> 01:24:39,160
 any reserves. We actually have all the reserve usage taken out. We are showing a net income

780
01:24:39,160 --> 01:24:45,080
 of $295,000 for the proposed budget. No rate increases, as Tony has previously mentioned

781
01:24:45,080 --> 01:24:50,920
 in his part of the presentation. And then the ending fund balance is $73.5 million.

782
01:24:50,920 --> 01:24:53,860
 A couple of other things I want to point out on this slide, you can see the debt coverage

783
01:24:53,860 --> 01:25:00,880
 ratio is 1.4. We currently have an internal policy of 1.25. And then you can see the reserve

784
01:25:00,880 --> 01:25:06,040
 requirement. So in the electric fund, we budget a minimum of 60 days, which represents 16%

785
01:25:06,040 --> 01:25:12,120
 of expenses. Our maximum target is 75 days, which represents 21% of expenses. So you can

786
01:25:12,120 --> 01:25:17,320
 see that reserve of $73.5 million is definitely above that maximum. So we do have a healthy

787
01:25:17,320 --> 01:25:21,240
 fund balance in the electric fund. A couple of other things I want to point out. So as

788
01:25:21,240 --> 01:25:26,320
 I said on the previous slide, we do have no sell for the TNPA facility. We are accounting

789
01:25:26,320 --> 01:25:31,720
 for $21 million in decommissioning expenses associated with that facility. That number

790
01:25:31,720 --> 01:25:36,200
 is included in this purchase power number that you see. A couple other things that stand

791
01:25:36,200 --> 01:25:40,400
 out on this reform I want to show you really quick. The rate of return, you can see it

792
01:25:40,400 --> 01:25:45,540
 does increase. So we had $16 million in the adopted budget. We do show it coming in over

793
01:25:45,540 --> 01:25:52,060
 budget $18.8 million. That is half of the year at the 6% rate of return for the general

794
01:25:52,060 --> 01:25:56,800
 fund. I mean, you can see it continuing on. It does end in 2022 and 2023. It goes back

795
01:25:56,800 --> 01:26:04,320
 down to $16.3. And then one other on the revenues, jumping back up here to the top really quick,

796
01:26:04,320 --> 01:26:11,440
 that no rate revenues. You can't see the decrease between '22 and '23. And that is the decrease

797
01:26:11,440 --> 01:26:18,380
 in the rate of return for those transmission assets. This is the deck pro forma. So this

798
01:26:18,380 --> 01:26:22,400
 number is included in the previous pro forma that you saw. So total revenues for the electric

799
01:26:22,400 --> 01:26:27,920
 fund. You can see the deck revenues are $24.5 million in the proposed budget. We do have

800
01:26:27,920 --> 01:26:33,880
 expenses including debt service of $33.2 million. So we are currently budgeting a loss for the

801
01:26:33,880 --> 01:26:39,120
 deck of $8.6 million. A couple things I want to point out. We did put a note in here at

802
01:26:39,120 --> 01:26:45,320
 the bottom. The net income for the deck is decreasing. The Ford market is showing energy

803
01:26:45,320 --> 01:26:52,240
 to cost less than the future, which is less need for the deck to produce energy for the

804
01:26:52,240 --> 01:26:57,120
 city. So you can see as you track across here, it actually goes from $24.5 million in the

805
01:26:57,120 --> 01:27:01,520
 current proposed budget to $11.5 million in the future years. We wanted to be sure to

806
01:27:01,520 --> 01:27:14,360
 put that note on there for an explanation. This is the five-year CIP for the electric

807
01:27:14,360 --> 01:27:20,000
 fund. A couple things I want to point out. We are budgeting about $6.8 million for distribution

808
01:27:20,000 --> 01:27:24,680
 substations in this budget. We do have some street lighting funding in here. This is something

809
01:27:24,680 --> 01:27:29,000
 Tony had previously communicated to city council we had budget for moving forward. So we do

810
01:27:29,000 --> 01:27:33,400
 have $3 million in street lighting budget for the electric fund. Distribution total

811
01:27:33,400 --> 01:27:40,040
 is about $32.2 million in bond funded projects. Transmission is about $32.8 million. This

812
01:27:40,040 --> 01:27:45,920
 is that Hickory substation that Tony had mentioned. Total is $65 million in projects. Over the

813
01:27:45,920 --> 01:27:52,400
 five-year period, you can see it's $237.6 million. And all this is accounted for in the five-year

814
01:27:52,400 --> 01:28:00,520
 forecast that I just showed you. Electric rates. We're not looking to make any substantial

815
01:28:00,520 --> 01:28:04,560
 changes to the electric rates. We will be bringing the rate ordinance back to you for

816
01:28:04,560 --> 01:28:08,820
 adoption. What we would like to do leading up to the conversation in November and December

817
01:28:08,820 --> 01:28:13,440
 is make minimum updates to the electric rate ordinance. Currently, we are proposing to

818
01:28:13,440 --> 01:28:17,280
 change the following rates that are included in this table. The first one being the residential

819
01:28:17,280 --> 01:28:23,180
 renewable energy services rider. Also referred to as the RG. All customers now receive 100%

820
01:28:23,180 --> 01:28:27,920
 renewable energy. So we are just looking to take this out of the rate ordinance. Weekend

821
01:28:27,920 --> 01:28:33,000
 services. This is another one we're looking to do away with. We actually in a recent audit,

822
01:28:33,000 --> 01:28:37,500
 we did reveal that customers were hitting their monthly peak during the week instead

823
01:28:37,500 --> 01:28:43,080
 of the weekends. Downtown decorative lighting. This rating is known or applicable. So we

824
01:28:43,080 --> 01:28:50,000
 are looking to take this out. The dark fiber. This rate is currently in the electric ordinance.

825
01:28:50,000 --> 01:28:54,600
 This will move over to tech services and tech services will show on their schedule of fees.

826
01:28:54,600 --> 01:28:58,080
 So we are coordinating with them currently to make sure that makes its way into their

827
01:28:58,080 --> 01:29:02,880
 fees. The banner install fee. We are working with development services to take this out

828
01:29:02,880 --> 01:29:09,520
 of the electric ordinance. We should have a consensus among staff soon, but we are currently

829
01:29:09,520 --> 01:29:14,440
 recommending to take it out of the electric rate ordinance. Commercial renewable energy

830
01:29:14,440 --> 01:29:19,440
 services. CGR. Also similar to the residential renewable. We are looking to take this out.

831
01:29:19,440 --> 01:29:25,240
 All customers do receive 100% renewable energy. And then the independent wholesale generator

832
01:29:25,240 --> 01:29:33,360
 IWG. We are also looking to do away with that rate. And then for reference, if anybody had

833
01:29:33,360 --> 01:29:37,960
 this question, there's 186 residential customers currently on the RG rate, which is average

834
01:29:37,960 --> 01:29:45,960
 annual savings of 47.36. Next step. So as Tony has previously communicated, we do have

835
01:29:45,960 --> 01:29:51,800
 a special called meeting with you on August 3rd to talk about the remainder of the utilities.

836
01:29:51,800 --> 01:29:56,600
 We will discuss water, wastewater and solid waste during that meeting. So we'll be bringing

837
01:29:56,600 --> 01:30:01,080
 that back forward to you. This actually will go forward to city council on July 30th. This

838
01:30:01,080 --> 01:30:05,240
 does say July 28th. So that is a typo. That should be the 30th. We will discuss this with

839
01:30:05,240 --> 01:30:11,120
 the city council during a budget work session. We will circle back with the PBB on August

840
01:30:11,120 --> 01:30:17,720
 10th to review the budget one final time and seek your approval for that in the rates and

841
01:30:17,720 --> 01:30:22,720
 then September 15th this year, the city council was scheduled to adopt the budget, the tax

842
01:30:22,720 --> 01:30:26,560
 rate and the capital improvement plan. And then as Tony has mentioned November, December

843
01:30:26,560 --> 01:30:30,720
 timeframe, we will circle back to the PBB and city council for a detailed rate and budget

844
01:30:30,720 --> 01:30:36,440
 discussion. But that that'll conclude the financial portion of the presentation. And

845
01:30:36,440 --> 01:30:43,520
 if you give me a second, I will pull it down or you can ask questions. Okay. Questions.

846
01:30:43,520 --> 01:30:52,160
 Go ahead, Russ. Yeah. What is the biggest risk factor in your opinion to hitting the

847
01:30:52,160 --> 01:30:57,520
 projected budgeted numbers you have for the coming year? All of these assumptions have

848
01:30:57,520 --> 01:31:03,000
 some amount of risk to them. What do you think is the most risky assumption that you've made

849
01:31:03,000 --> 01:31:10,520
 in your budget for the coming year? Um, do you mean to do directly related to the pandemic

850
01:31:10,520 --> 01:31:16,600
 or just the load forecast that we currently have plugged in or or is it both? All of them.

851
01:31:16,600 --> 01:31:22,720
 All of the factors that go into making your annual budget projection. Let me, let me,

852
01:31:22,720 --> 01:31:25,620
 let me answer one part of it and then I'll turn it over to Terry Nolte. They'll address

853
01:31:25,620 --> 01:31:30,200
 the load factor of it. Um, the first part is so the COVID pandemic on the utilities,

854
01:31:30,200 --> 01:31:33,680
 we are currently monitoring that for each of the utilities to see what the financial

855
01:31:33,680 --> 01:31:39,560
 impact will be. And we do have a revenue loss assumption in the electric proforma now. That

856
01:31:39,560 --> 01:31:43,240
 is one reason we want to circle back with you November and December. So around the October

857
01:31:43,240 --> 01:31:47,280
 timeframe, we'll actually get that hard data of how the pandemic has impacted the utilities

858
01:31:47,280 --> 01:31:51,480
 from a billing standpoint. So we'll be able to true that number up in the proforma when

859
01:31:51,480 --> 01:31:55,120
 we come back to you. Um, now with that being said, let me turn it over to Terry for the

860
01:31:55,120 --> 01:32:05,280
 load portion of it. I mean, he can address that question.

861
01:32:05,280 --> 01:32:11,280
 So financially, the, uh, the largest risk that we always face is the, uh, the price

862
01:32:11,280 --> 01:32:18,520
 formation in the air cop market. Um, you know, each year we project, uh, our revenues and

863
01:32:18,520 --> 01:32:26,120
 our, our, uh, our expenses, expenses being loved, uh, the expenses to purchase energy

864
01:32:26,120 --> 01:32:33,100
 from the market, uh, to serve the load and, uh, the estimates of what we, what revenues

865
01:32:33,100 --> 01:32:39,700
 will achieve from the sales of renewable energy and deck energy to the market. Uh, those forecasts

866
01:32:39,700 --> 01:32:46,660
 are based upon visibly traded forward markets, which change like the stock market does from

867
01:32:46,660 --> 01:32:53,820
 hour to hour, day to day. Uh, we do have a hedge plan that we, uh, are executing against

868
01:32:53,820 --> 01:33:02,160
 in order to, uh, try to stabilize those revenues and, uh, those expenses as best as possible.

869
01:33:02,160 --> 01:33:07,580
 But we, uh, because of our, the nature of our portfolio, which is heavily driven by

870
01:33:07,580 --> 01:33:15,440
 weather events, mainly wind and, and solar intensity, there's a large portion of the

871
01:33:15,440 --> 01:33:22,280
 supply that we cannot forward hedge because we don't know, uh, exactly what the output

872
01:33:22,280 --> 01:33:30,280
 would be. So that's the biggest single risk, uh, looking forward financially, the biggest,

873
01:33:30,280 --> 01:33:36,520
 one of the bigger risks. Uh, and we've, as Nick mentioned, we've, uh, we've conservatively

874
01:33:36,520 --> 01:33:46,300
 forecasted our T-cost revenues. Uh, T-cost returns are 28.04%. Uh, last year, uh, provided

875
01:33:46,300 --> 01:33:54,980
 about 17, a little over $17 million of incremental, uh, non-rate revenue for the benefit of customers

876
01:33:54,980 --> 01:34:01,900
 to the extent that that T-cost revenue, uh, diminishes as a result of a, a filing that

877
01:34:01,900 --> 01:34:07,520
 we would be called in to make, uh, and lower the allowed rate of return. That would have

878
01:34:07,520 --> 01:34:14,320
 a significant impact in the out years. We don't anticipate such a call, uh, for at least

879
01:34:14,320 --> 01:34:19,520
 two to three years. Uh, but to be prudent, we are including that reduction. So those

880
01:34:19,520 --> 01:34:23,040
 are the two biggest financial risks, uh, that we face.

881
01:34:23,040 --> 01:34:29,480
 Is that an interesting question? It does. I was just, one other thing, uh,

882
01:34:29,480 --> 01:34:36,440
 I was curious about the, uh, the demand on ERCOT. Uh, people are, are moving into Texas.

883
01:34:36,440 --> 01:34:42,760
 That's generally known. So I would think the demand on ERCOT as a system is going to increase

884
01:34:42,760 --> 01:34:47,520
 in the next year compared to what it is this year. Is there a, is there an estimate on

885
01:34:47,520 --> 01:34:56,560
 what the system demand increase might be in terms of percentage or megawatt hours or whatever?

886
01:34:56,560 --> 01:35:01,560
 I think as a market, the market is growing at about two to two and a half percent per

887
01:35:01,560 --> 01:35:08,640
 year on annual, on peak demand. That would be the instantaneous hourly peak demand across

888
01:35:08,640 --> 01:35:15,560
 the market. Uh, but we are seeing, uh, as, as our forecast shows about three and a half,

889
01:35:15,560 --> 01:35:22,760
 3.2 to three and a half percent, uh, annual energy increase. So across the year, the total

890
01:35:22,760 --> 01:35:29,440
 kilowatt hours, uh, consumed by customers is increasing at a greater rate than the peak

891
01:35:29,440 --> 01:35:37,280
 demand is. The peak demand, uh, is met, uh, through capacity additions in the marketplace,

892
01:35:37,280 --> 01:35:46,520
 which are primarily renewables, wind and solar, uh, which, uh, the solar tends to be very

893
01:35:46,520 --> 01:35:53,360
 highly correlated with peak demand, summer, hottest day of the summer. Uh, but the wind

894
01:35:53,360 --> 01:35:59,640
 is not as well correlated. It doesn't necessarily show up as we saw, uh, last summer on the

895
01:35:59,640 --> 01:36:04,560
 hottest day of the year. Uh, there was very little wind output in West Texas and that

896
01:36:04,560 --> 01:36:11,440
 caused prices to go up. And, uh, that, uh, goes to the issue that I mentioned before,

897
01:36:11,440 --> 01:36:17,480
 which is that price formation. Um, no one has a crystal ball. That's, that's, uh, clear

898
01:36:17,480 --> 01:36:25,640
 enough to predict what each hourly price is going to, uh, show up as in the future and

899
01:36:25,640 --> 01:36:31,920
 very high prices while, while they have benefits for the deck revenue and debt gross margin,

900
01:36:31,920 --> 01:36:38,840
 uh, they have an offsetting effect of high purchase power costs to, to meet the load.

901
01:36:38,840 --> 01:36:44,920
 So, uh, as we've mentioned to you before, the deck acts as an insurance policy to insulate

902
01:36:44,920 --> 01:36:52,080
 the load from those super high prices, but it generally nets out. Uh, we receive $9,000

903
01:36:52,080 --> 01:36:57,840
 for energy delivered from the deck and we purchase energy at $9,000 so that nets out,

904
01:36:57,840 --> 01:37:02,920
 but customers aren't exposed to that. So, uh, that's the benefit of our portfolio and

905
01:37:02,920 --> 01:37:09,100
 having that, that component in the supply portfolio to kind of insulate our, our customers

906
01:37:09,100 --> 01:37:26,720
 from those high price periods. Okay. Thank you. Questions. All right. So what do you

907
01:37:26,720 --> 01:37:34,960
 need from us, Mario? Just really nothing. Uh, madam chair, it's just a presentation

908
01:37:34,960 --> 01:37:39,440
 like we typically do during the budget cycle. So it's really just to be able to bring those

909
01:37:39,440 --> 01:37:44,160
 in that those pieces of information to you all, allow you all to ask whatever questions

910
01:37:44,160 --> 01:37:49,280
 you have of staff and, and, uh, if the council asks questions about the, what the thoughts

911
01:37:49,280 --> 01:37:54,320
 with the pub, we'll be able to relate those to them as well. And you'll be seeing similar

912
01:37:54,320 --> 01:37:58,840
 presentations from the other utilities, uh, next Monday at your special meeting. I believe

913
01:37:58,840 --> 01:38:06,720
 that said eight 30 or started eight 30 on Monday, the third. Yep. And, um, Billy cheek

914
01:38:06,720 --> 01:38:11,000
 did say that he will not have to leave early next Monday. He has to leave, he had to leave

915
01:38:11,000 --> 01:38:18,280
 early this Monday. So, okay. And I think before we, I don't want to get in if we are adjourning

916
01:38:18,280 --> 01:38:26,720
 soon, I believe Mr. Collister may have a question or a statement to make. Yes. I make sure.

917
01:38:26,720 --> 01:38:31,080
 I was talking to the city attorney and we just, we discussed this before the lawsuit

918
01:38:31,080 --> 01:38:35,140
 is a personnel matter, which is really, which is outside the purview of the PB under the

919
01:38:35,140 --> 01:38:41,400
 charter and there has not been a judgment entered yet by the court. Once the judgment

920
01:38:41,400 --> 01:38:46,720
 is entered, you'll be able to take the, uh, impact of that judgment consideration with

921
01:38:46,720 --> 01:38:53,840
 a budget. And that's as far as we can go right now. Absent council providing direction, uh,

922
01:38:53,840 --> 01:38:58,360
 for us to give you all a briefing. And if you want to make a request to council to go

923
01:38:58,360 --> 01:39:07,880
 into the details of the lawsuit, that can be done. Okay. Do we, how does the board feel?

924
01:39:07,880 --> 01:39:13,480
 Do they want, do you want to make a request to city council? Yeah, I would personally

925
01:39:13,480 --> 01:39:18,700
 like to know what's going on there. And if there's, if it's going to require any kind

926
01:39:18,700 --> 01:39:23,720
 of a change in policy with the utilities, the way they handle personnel or anything

927
01:39:23,720 --> 01:39:31,200
 like that, perhaps we could discuss that. I know there's feeling, I know how Charlie

928
01:39:31,200 --> 01:39:40,200
 feels Barbara. Yes, I agree. Okay. Karen. I understand the reasons why we can't be,

929
01:39:40,200 --> 01:39:46,400
 you know, apprised of details. I mean, yeah, I think I brought this up when it first started

930
01:39:46,400 --> 01:39:52,320
 hitting the newspaper quite a while ago. And so I'm satisfied with the fact that, you know,

931
01:39:52,320 --> 01:40:14,000
 it's a personnel matter that we can't really throw. Yeah. And sorry. Yeah. I agree with

932
01:40:14,000 --> 01:40:21,080
 Karen's assessment of the situation. So kind of a split here. Cause I, I understand it's

933
01:40:21,080 --> 01:40:26,560
 a personnel matter and I'm waiting, I'm willing to wait until the court puts in a judgment.

934
01:40:26,560 --> 01:40:33,840
 I don't see any reason at this point to put staff through that work. When we, when it,

935
01:40:33,840 --> 01:40:38,840
 when, once it's settled, we can get the big picture. Larry, when you say the judgment

936
01:40:38,840 --> 01:40:46,040
 has not been entered, I learned from the paper that the jury has found against the city of

937
01:40:46,040 --> 01:40:54,000
 Denton and the city, is this on appeal or has the judgment itself not been? The judgment

938
01:40:54,000 --> 01:40:59,580
 itself has not been entered. There was a discussion among both sides on the form of the judgment

939
01:40:59,580 --> 01:41:07,200
 and it's been going on for quite a while. And the, and the state has also entered in

940
01:41:07,200 --> 01:41:13,480
 to lawsuit with respect to caps on the judgment amounts and the court has ruled in their favor

941
01:41:13,480 --> 01:41:19,160
 on that. There, there's a lot more to be done. The court has ruled in his favor. The court

942
01:41:19,160 --> 01:41:22,800
 ruled in the favor of the state, which is essentially in favor of the city about putting

943
01:41:22,800 --> 01:41:32,160
 limitations on the damage caps. Okay. I would argue these are the kinds of things that help

944
01:41:32,160 --> 01:41:44,280
 us stay up to speed on that. The other question is what, what fund do you anticipate resolving

945
01:41:44,280 --> 01:42:00,120
 the costs of this litigation and judgment? Let Finance answer that question. Nick Vinson,

946
01:42:00,120 --> 01:42:04,680
 assistant director of finance. This would come from the electric fund. I'm taking your

947
01:42:04,680 --> 01:42:11,360
 question. Okay. Then I would renew my mention that it's relevant to the public utilities

948
01:42:11,360 --> 01:42:21,760
 board. Thanks. Well, maybe we should discuss it again on the third, since Billy's not here

949
01:42:21,760 --> 01:42:28,480
 and can't weigh in and we were basically split. So, so what we'll do is we'll go, we'll go

950
01:42:28,480 --> 01:42:35,520
 ahead and keep it on the matrix like it has. And so we'll, I'll ask Kim Mankin to go ahead

951
01:42:35,520 --> 01:42:40,840
 and put a management report item like we normally would for a normal meeting. And that way,

952
01:42:40,840 --> 01:42:46,960
 if you do have a seven or an odd number, that way the board can give direction one way or

953
01:42:46,960 --> 01:42:52,480
 the other on how you would like to proceed since you're tied three, three, it is an important

954
01:42:52,480 --> 01:43:00,040
 subject. I am not saying that that it's not, it, it impacts the utility greatly. Just it's

955
01:43:00,040 --> 01:43:08,160
 not settled yet. So, all right. With that, do we have a motion to adjourn? So I move.

956
01:43:08,160 --> 01:43:12,920
 All right. I guess we're adjourned. Have a great one. Take care. Thank you.