Sep 28, 2020 Public Utilities Board on 2020-09-28 9:00 AM

- All right, Susan, you're on. - All right, it is nine o'clock on September 28th. We do have a virtual quorum. So we're called to order the City of Denton Public Utility Board meeting. The first item on the agenda is the consent agenda. Items A through C. Does any board member wish to pull any of the items? I do believe that's the first. Do we have a motion to approve items A through C on the consent agenda? - Approved, so moved. - Second. - Karen seconded. All in favor say aye. - Aye. - Opposed? Motion carries. Next item are items of individual consideration. Consider the approval of the September 14th, 2020 minutes. Does anyone have any changes or corrections? All right, do we have a motion to approve the minutes? - So moved. - So moved. - Second. - I think that was Karen and Charlie seconding. Okay, all in favor say aye. - Aye. - Okay, motion carries. Item B, consider recommendation and adoption of an ordinance of the City of Denton, Texas, a home rule municipal corporation, authorizing the approval of the second amendment to professional services agreement between the City of Denton and SGS Engineering LLC, amending the contract approved by the City Council on July 19th, 2011 in the not to exceed amount of $1,002,060. I'm not going to read the whole thing, but the new second amendment expenditure amount not to exceed 3.5 million with the total contract amount not to exceed $11,435,000. Go ahead. - Is there a presentation? - Yes, we have Jerry Fildler that's going to do a presentation. - You may be on mute. - Am I mute? - No. - No. - Jerry was on mute, the staff member. - Okay. - Presentation. - Looks better. - Oh, this one up here. - Okay. - I'm getting there. Well, good morning, Jerry Fildler. I am the division engineering manager for municipal electric. Today we're coming before the PUB to talk about a second amendment to the SGS engineering contract. To kind of go over a little bit of the information that they provide for us, some of the professional services SGS provides for us is they provide the engineered drawings for all of our substation and transmission line construction. This includes the structural steel, electrical design, grounding, and static protection, as well as the relay and system protection design. They also provide some construction inspection services for us. And again, some of these are ensure the construction meets the design and regulatory requirements and maintain the records of the daily weather and construction activities. A little bit of the scope of this project, as you can see from this next slide. Some of these are the items that we have proposed for SGS to perform for us. So the additional funds in the amount of $3,500,000 will provide these services for CIP projects. For the substation structural and electrical designs, transmission line designs, protection system designs, and other engineering related support as required. And we've given you a list of the projects that we have identified for this contract. So at this time staff recommends approval of the amendment to the existing agreement with SGS in the amount of not to exceed a $3,500,000 for a total contract value of $11,435,000. The contract will be structured as an hourly contract so that the charges for services rendered will be billed and there is no minimum amount guaranteed to the vendor, to the engineering firm. Have any questions? - Yes, I have a question. - Okay. - On this substation projects, what does RTU mean? - I'm having a brain seizure. Relay Terminal Unit. It's basically the communication, remote telemetry unit. Sorry, I'm getting it off out here. It is basically the thing that helps us communicate with the SCADA system between the head in office and the equipment out in the field. - Okay, thank you. - I have a question. It says in the agenda description for this item that the majority of work within transmission category will be recovered through the TCOS provisions. But in the presentation, it says all will be recovered. Those seem to be two contradictory statements, which will all of this be recovered or will only a portion of it be recovered? - The vast majority will be recovered. There may be some items once we get into the construction that aren't covered by TCOS, but for the vast majority of everything that we have associated with this contract should be recovered through TCOS. - Okay, and follow-up question to that is, how long does it actually take Denton to receive the money through the TCOS process? - About 18 months. A year and a half after we spend it, we get it back. That's correct? - Yes, sir, that's what I'm understanding. - Okay. - Yeah, Mr. Baffert, one of the things that I'll mention is that we've historically filed an interim filing for those recoveries on an annual basis. Because of some recent changes, we're now going to buy annual filing. So we think that that timeframe may be a little shortened. - Okay, just out of curiosity, how does this, Tony, how does this work into your budget planning from year to year? - Well, we certainly assume a growth projection in that five-year forecast. I will tell you, we've also assumed a slightly lower return on investment than what we're currently receiving, just because at any point, the commission could call us in for a full rate case. Well, we don't anticipate one, but from a budgetary standpoint, we've kind of taken a more conservative approach. - Okay, thank you. - Yes, sir. - Go ahead, Karen, I'll let you go first. - Oh, thanks. Just a sort of procedural question for staff. Why is this contract amendment on individual approval part of the agenda? And we, but we've also have the same kind of contract amendments on consent agenda. What's the, what are the criteria for where it shows up on the agenda? - Well, it's really on a case-by-case basis, but a lot of times it's, what's driving it is the dollar amount. And so depending on dollar amount, we're placing. - There's a dollar cutoff? - It's not a hard dollar amount, it's more subjective. The staff is trying to determine whether it needs to be in consent agenda, or if it's going to be pulled anyways, we go ahead and do that proactively. - Okay, I guess that's fine, because of course consent agenda goes faster, but I just want to make sure that things don't get snuck into those huge consent agendas. - Correct, we pay very close attention to those, yes. - Okay, thanks, Tony. - All right, I'm sure if this was on consent, one of us would have pulled it at three and a half million. Charlie, go ahead. - I think I know the answer to this, but just to check, I noticed the approvals date back to 2001, and this is a third amendment. I assume the reason we're doing that via amendment, rather than via a new ordinance is just for expediency? - Yes, sir, it is for expediency, but just to let you guys know that we expect for all the ones that I'm gonna visit with you today, we expect the funding to last about three or four years, and we are gonna go out for another RFQ at that time, just to make sure that we are getting the best deal for the city. - Okay, thank you. - Thank you. - I'll move approval. Oh, I'm sorry, you had a question. - No, I actually had the same question you had, Charlie, just so that the public understood what was going on. So, no, you're fine. Any other questions? - In that case, I'll move approval. - Oh, wait, Billy's got a question, sorry. Go ahead, Billy. - Go ahead, Billy. - I apologize for my tardiness here, but my question, it's probably in here, I didn't find it. What's the estimated construction cost? - The contract value was $3.3 and a half million dollars, the amendment value. The not to exceed for the entire contract, if this gets approved, is $11,435,000. - What's the estimated construction cost? - This is engineering services. It's not really. - Okay. - Billy, to answer your question, Billy, it's for several projects. It's not just a single project. - Oh. - Yeah, the project that the engineering is for is what I was getting at. So the projects, do you have an estimate on all those? - I can provide that for you if I can figure this out again. - Like I said, I apologize for my tardiness. - So I brought the slide back up. This is the scope of what we've included in this amendment for all the substation projects and transmission line projects. - There's no construction estimate for these projects? - We can provide you the actual proposal from the vendor that has these things broken down, but we just combined them here, I guess for expediency, just to kind of give you an idea of what's all included. - Okay, and I'm getting at this because there's usually, when you're putting together any project, obviously, there's a lot of engineering involved, and I like to get an idea of usually what percentage of cost the engineering is of the actual project. - It's usually a five to 10% of the project, Billy, but I will tell you, some of these projects, we're gonna talk about in detail when Nick comes up here and we go through the CIP program, so you'll see many of these projects there with the engineering's estimate at completion that'll kind of give you the information you're looking for. - Okay, fair enough, thank you. - All right, now, Charlie, would you like to move approval? - I will reconfirm my motion to approve. - Do we have a second? Oh, Ed seconds, all in favor say aye. - Aye. - Opposed? - Aye. - Motion carries. Next item is consider recommending the adoption of an ordinance of the city of Denton, a Texas home rule municipal corporation authorizing the approval of a third amendment to the professional service agreement between the city of Denton and Black and Veatch Corporation amending the contract approved by city council on November 6, 2012 in the not to exceed amount of 564,000 amended by amendments one through two approved by the city council said third amendment to continue to provide electrical substation design and other engineering related consulting services for the capital improvement projects and other technical support for the Denton municipal electric providing the expenditure funds therefore and providing an effective date file 5089 providing for additional third amendment expenditure amount not to exceed 2,990,900 with the total contract amount not to exceed 6,556,300. And I think is it Jerry again, I believe him. - It is me again. And it looks like I'm having technical issues 'cause when I pull the presentation up, it's empty. So if you guys would kind of bear with me as far as you should have gotten a copy of the PowerPoint in your package, if I could just go over the information with you, would that be sufficient? - It's fine with me. - All right. - Add it up. - So again, we're before you today to talk about a third amendment for the Black and Veatch Corporation engineering firm. This amendment is the amount of $2,990,000 with a not to exceed for the total contract of $6,556,300. Going to the second PowerPoint slide that you should have been seeing. Professional services that they provide for DME right now include NERC, ERCOT and the Texas Reliability Entity Compliance Support, Relay Design and Setting Consultation. The next one for this will be the Brinker Substation which should be coming online in the next few months. New and Future Site Conceptual Design Analysis. This is related to the new Underwood Substation which is near the Coal Ranch, Under Ranch area and additional engineering and technical support. The next slide would be professional services continued for the Hickory Substation Owners Engineering Services. The Section 2269.305 of the Texas Government Code requires the City of Denton have an owner's engineer to serve as DME's representative for this substation construction. Black and Veatch will provide that service for us. The Hickory Substation, the GIS substation will be a design build project. So it'd be engineered and constructed under one contract. We believe that this will provide us with some price certainty and it provides less design risk. GIS is a new technology to DME. And so we're using some folks that have got a little bit more experience with GIS than what we do to help us through the process of getting this substation designed and built. And Black and Veatch, it's role during this time will prepare design criteria package, assist with the evaluation of bids, assist with the design reviews and provide engineering oversight of the project. The next slide will be a little bit of information about the costs associated, or the costs included with this presentation for the $2.9 million we're asking for. 900, almost a million dollars of that is to perform the services as the owner engineer for Hickory GIS substation. Then we also have NERC, ERCOT, TRE compliant support, the relay design and setting consultation, substation site, conceptual design and analysis, future substation project designs and additional engineering and technical support, which are the items that we had talked about in previous presentations. All of these combined, their estimated costs combined to the $2.99 million that we're requesting. - Great. - And again, the recommendation is that staff recommends approval of the amendment to the existing Black and Veatch Corporation contract in the amount of $2.99 million with a total not to exceed of $6.556, $300. And again, as the other contract, this is being structured as an hourly, so that only charges for services rendered will be billed. Questions? - And just like the last one, this one will, the majority will be covered under our transmission rates, correct? - Yes. - I have a question. - Go ahead Ed. Sorry, I didn't see you there. - That's all right. This is a rather mundane question, but some people might be curious as I am. Lawyers bill by the hour. How does a consultancy or an engineering firm like this bill in terms of, what's their price structure? Is there an actual price structure that is given to the purchaser as to how much, what is going to cost, or is it, I don't understand the billing procedure. - Yeah, contracts like this, contracts like this are done under an RFQ, so it's a request for qualifications, which during the entire contract process, we can't really discuss price until we've met, we've decided on the firm that we feel is the best one for the services that we want. Now, typically what I've seen in the past is that they have a listing of all of the staff that they're gonna do, their titles, and an hourly rate for that person to do work with us. Then when we get billed, we actually see, there's a senior engineer, X number of hours, and X number of dollars per hour total cost. And we kind of look at that compared to what we think's reasonable. And if it is, then we say, okay, we go ahead and move to pay the bill. Otherwise we do call them back and say, hey, look, can you kind of explain to me what their role was, just to make sure that we know that the pricing and the cost is fair. - Great, thank you very much. - Other questions? - Yeah, I have a question. - Billy was up first. - Go ahead, Billy. - I have the same question that I did for the last item. And I would assume, Tony, is this gonna be in a later presentation? I prefer that that estimate be on the money that you're asking for, have that question answered when you're asking for the money. - We can do that. - We can certainly do that. - Okay, and just a comment. It is industry standard and for engineering to be billed by the hour and plus expenses like lawyers bill. - I think then it was Russ. - Yeah, Ed, to answer one of your comments, I went through the calculation. If you look at the total cost divided by the number of hours, you get around $155 an hour for an average rate for what they're asking for. - Okay. - If you compare that number with your favorite local lawyers hourly rate, lawyers are probably gonna be a lot more than that. So one other question I had, Jerry, will Black & Beech be bidding on the actual design bid part of this or not? - No, as the owner's engineer, they can't also bid on the project. - Okay. Okay, Charlie, did you have a question? - Real quick one. Can you tell me one more time what gas insulations benefits are relative to what the city's been using in the past? - What we're used to in the past is what you see most time is air insulated substations. Gas insulated substations, the main advantage is their footprint. They're a lot smaller. They take up a lot less land than what an air insulated substation requires. So that's a major benefit to a lot of folks. If you have a limited area that you wanna put a substation in, then GIS substations are typically a good route for you. - So what we're trying to do is optimize the cost. We're not meeting someone else's requirement that came from somewhere else. We're just trying to, land has gotten more expensive and gas insulation might be cheaper. - I'm not gonna say it's gonna be cheaper, but it certainly allows us to use the land that we've got provided, to be able to put in the capacity, current and future capacity of the substation that we need. - Great, thanks. I meant overall cheaper. The land savings outweighs the extra cost for the gas insulation. - Not necessarily. - No. - Oh, okay. - Yeah, Charlie, this is Tony. So there was two substations that were being proposed by DMV a couple of years ago. One was Eagle, one was Hickory. Council had a lot of conversations about where the substations were gonna be in that area of town. And direction the council gave us was to go forward with a gas insulated substation. And so as you know, we've proposed to the POB and the council not to do the Eagle substation, but we're still pressing forward with the Hickory substation. And based on council's direction, 'cause the considerations with the neighborhood, discussions with the neighborhood, we're gonna proceed with a gas insulated station there on Hickory. So it was really a council and frankly, POB decision to push forward with that type of substation. - Thank you. - Charlie, it may be cheaper politically, I think is the answer. - I understand. - Any other questions? All right, do we have a motion to approve? - Move approval. - Okay, Barbara's moved approval. She's stuck right now. Do we have a second? - I'll second. - We're all stuck. - Not on mine. - Not on mine. - Okay. - All right, one of you second. - Hello. - Susan, we can hear you, Susan. - No, she's frozen now. - Can we take this or you wanna wait on Susan? - Assuming she wants votes, I'll vote aye. - Yeah. - I'll second. - I'm looking at Larry. Larry, is it okay if we have someone else take over? - Yeah, Billy can go ahead and call the vote. - Okay. - We have a motion. Can we have a second? - I second. - Second from Russ. All those in favor, please say aye. - Aye. - Aye. - Opposed? Motion passes. Let's note that Susan is knocked off here. So I'm a vice chair, I'll take that. Let me get her back. - So Billy, that was a six OVO with Susan being absent. - That's correct. - Okay. - Okay, we're moving on to, that gets us to the management reports, doesn't it? - It does. So on the management reports, we have a couple of items here for you. So the first item that we had was just a follow-up memo on the root cause analysis for Hickory Creek. And we do have Kenny Banks and Frank Pugsley on here. I did just wanna briefly just thank Frank for his two years of service to the cities. I communicate to you, Frank is departing the city. His final day will be October 5th. And I have asked Terry Nolte to step in as the interim director while we do an executive search for Frank and he'll be working with Kenny Banks and also Preenam-Detchmouth to continue to run those two utilities. But happy to answer any questions if anyone has any on that Hickory Creek root cause analysis follow-up memo. - Yes, I have a few questions, comments on that. - Sir. - First of all, thanks very much for doing that. And it's a important step forward, I think, for city of Denton utilities to get some process nailed down to evaluate this stuff in the future. One suggestion I have on the template is if you could add something somewhere near the end, asking the question, should any operating practices or procedures be revised as a result of the incident? And if the answer to that is yes, then those revisions need to be written down, discussed a little bit. Can you comment on that? - Sure, Mr. Baffert, this is Frank Pugsley, water and wastewater utilities director. And yes, in the template, we do have the section for potential problem and opportunity analysis where we specifically want to look at the issues that we faced and opportunities to prevent them in the future and to consider better or different maintenance logs and newer updated standard operating procedures or training for staff to help prevent those in the future for sure. And we also, what we didn't complete in this report that was sent to you this time because of the time that had elapsed since the event would be really an after action review for getting with staff to see what went right during the event and what didn't quite go as well as planned so we can be better the next time. - Yeah, yeah, that's all true. I would just suggest Frank that the actual template be explicitly to include the question which would be answered in every event that you analyze. Does do any operating practices need to be revised? Yes or no, and then if yes, explain though. That's all I was getting at there. - Okay, understood. Yeah, we can add that if explicitly in there. - And as I was reading this event, it looked to me like it'd also be beneficial if you could include some kind of a small drawing of the piping system showing the components as they were configured and which ones failed. Something that matches what you're describing in words in the narrative. - Sure, that's a good suggestion. I think we can pick up especially like the as-built drawings and mark those up and include them as an attachment. - Yeah, another thing, the thing that actually started this, if I read your description correctly, is an electrical anomaly that resulted in the VFD going down. And I think that electrical anomaly and what took down the VFD really deserves more detail than what we had there. Maybe you can't reconstruct that now, but in the future. - Yes, absolutely. And we did at the time attempt to kind of reconstruct that. We spoke with DME to see if they had experienced or seen anything in their SCADA at the nearby substations. And honestly, between the two utilities, we weren't able to actually identify anything, but the VFD for some reason did trip out for just a split second in causing this issue. And it could be just that the VFD is aging. It is in a harsh environment and it'll be replaced very soon. - Okay, and one final question. What new features in the new lift station are going to be installed so that something like this is less likely to happen in the future? - Sure, the existing lift station has that wet pit, dry pit configuration. It really doesn't have adequate isolation capabilities. So if something did go wrong in the dry pit, as far as mechanical piping, we don't have a way to isolate. The new lift station is a wet well with submersible pumps. And so the discharge piping is much less complicated and any kind of failure in the piping would not affect all three pumps. It will only affect the one pump that had an issue and we can isolate that much more easily. And the new lift station also will have integrated bypass connections so that we can connect temporary bypass pumps relatively quickly and not have to lay a quarter mile of hose to our neighbors lift station in the future. - Yeah, well, that's good. It might be worthwhile to include what you just said in some summarized form in with your report that you already wrote about this incident to let everyone know that things are gonna be configured differently in the new arrangement. - Understood, yes, sir. - That's all I have. Good job. - Okay, if there's no other questions on that, the next item is a memorandum from Becky Davidian. She's on the phone as well regarding the use of a 5% contingency on certain capital improvement projects. This is just really to provide a clarification on how that's gonna come. It's probably gonna impact bids and RPs that come to you, but certainly happy to answer any questions, have Becky answer any questions that anyone may have on that memo. Any questions? I'm back, by the way. Don't know what happened. All right. - I guess, I just, sorry to be so last minute, but I'm just trying to remember, I think we've always used a 5% contingency, haven't we, or I'm just not remembering exactly how this, it seems like we've been seeing this forever. This is just an explanation of something that we've already been doing. - I think we've lowered it, didn't we, from 10% to 5% in recent years? - I believe that's accurate. And again, I think the attempt here is to cut down as much as possible on future change orders that may occur, that may require action. And so that's really kind of the attempt, but really you just wanna be transparent and make sure that we're clear on what we're gonna be doing going forward with these bids. - Yeah, thanks, I was just too lazy to do the research. - Okay. All right, so the next item that's on here is your feature agenda items. We only have one, and I know we've had a couple of questions about the solid waste management strategy, but we wanna let you know that that is coming, will be coming to you on October 12th. And then on the last item is just also kind of new business, the one item that we had left over was the update on the lawsuit that you requested. Council's provided some direction and legal will be briefing you later today in your agenda on the direction that we got from council on that. So with that, that concludes the management reports unless there's something else, some of the questions that you have. - Doesn't look like it. And then we're on to concluding items. This is the point where you can congratulate Frank, wish him well, beg him to stay, all of the above. (laughing) I do anyway, Frank, wish you the best in the future. Congratulations. - Yes, wish you the best, Frank. Good luck. - Yeah, thank you all very much. It's been a pleasure working with you over the last few years, appreciate it. - Best wishes to you, Frank. - Does any board member wish to have item added to a future agenda? I do have one item that, oh, go ahead. You go ahead, Ed, you go first. - Is this the only place in the meeting, this is a question of point of order, is this the only place in the meeting where such a request can be made or can it be made after a presentation too? - Larry, could you answer that? - This would be the proper way to do it during this time as opposed to kind of going outside posting on another item. - Okay, then I have something. - Go ahead. - It's in relation to what is coming up in a little bit on the landfill gas management. I would like any information and/or discussion on the possibility of a pilot residential composting program, such as was done when recycling came in. I was on a committee, this was back in the '90s, on a community committee to establish a pilot recycling program, which is the program that is now in place. And I'd like to see the same process started for residential composting, a food waste especially. There are already programs like this in existence. Austin has a very good program. So I think it's time that we need to look at that. Thank you. - So Ed, how long has Austin been doing theirs? Do you know? - I think 2011. - Oh, okay. - And they have an incentive program too. - I can send you the information if you would like. - My daughter, she's been living in Austin. She just moved out, but she just got her bin for the composting. And she had her own robust composting. So I thought that it was a relatively new program in Austin. - Well, it was part of the 2011 plan. So I might be making the wrong assumption that it started in 2011. - So it's not just residential yard waste composting, you're food composting. - Yeah. - All right. - They have something like five bins. I mean, the color coding is very complex. - No one fit in my garage. - Thank you. - Billy. - I guess I better add beneficial. I wouldn't, my request earlier was on those two large engineering increases. And I would be interested in seeing the percentage. The cost of engineering as a percentage of the construction costs for the entire project. Going forward, it's difficult to approve the engineering if we don't know how it's applied to the entire cost of the project. I think you got that earlier. All right, Tony. - Yes, sir. - Okay, all right, thank you. - And I'd like the water staff to keep on top of what happened down in Houston with the, I'm gonna say it wrong, amoeba getting into the public water system. And how that, you know, just keep on top of that story. It's very sad a child lost his life over something like that. Anything else? - All right, then we'll move into work session. The first item A is receive a report, hold a discussion and give staff direction regarding options related to the management of landfill gas generated at the City of Denton landfill. - Good morning, Madam Chair, members of the committee. My name is Brian Burner, Director of Solid Waste for the City of Denton. I appreciate the opportunity this morning to talk a little bit about landfill gas and what we're doing currently to manage it and what our proposal is for the future at the City of Denton. I really wanna talk about what landfill gas is, talk about the regulatory environment that we operate within, really talk about the current management activities and then what our options are as we move forward. You may, let's see, before we get started, what we do wanna do is to go through just a real quick primer on some words we're gonna be using today, make sure everybody's on the same conversational basis. First of all, landfill gas, it's produced in the landfill and it's a byproduct of the natural decomposition of the organic materials. So the compressibles, the wood waste, construction demolition debris that may be able to degrade, that material is what manages or what makes the landfill gas. It takes anywhere from about one to three years to start producing the gas and then about five to seven years before we see, we see maximum production as a result of the material that was put in. So it's about a seven year process to actually see the gas formed on what may be put in the landfill today. We talk about renewable natural gas. What we're talking about is actually that natural gas that's derived from the organic material. So that, beneficially reusing that material as we move forward. As a reminder, this is not a fossil fuel, even though it is methane, it does not come from a fossil fuel source. So it is considered renewable, a renewable material. We talked a little bit about non. - Can I ask a question? I need some clarification on this. May I, is it okay now? - Yes, and if you can just give us a second so we can take down the presentation and then you can ask the question. - Yes, sir. - Okay, thank you. I'm just curious, you did not mention food waste as one of the producers of methane gas. And am I making a wrong assumption that food waste is not involved in this? - No, food waste is involved in this but it's part of that pretrustful organic material that can be converted into renewable landfill gas. - Okay, and is this so-called renewable natural gas, it is methane, correct? - It is methane, correct. - And does it have the same climate change capacity as effect on the climate as fossil fuel methane? - If it is released directly into the land or into the atmosphere, yes. But again, based on our requirements and our control measures, it is destructed before we get to that point, either through the flare or through- - Okay, I'm just gonna make the point that methane is methane. And giving this euphemistic term of renewable natural gas is really a misnomer. We need to call it what it is. - Again, this is the EPA's verbiage for this material and that's what I care for. - I understand that, but you understand the political implications of putting the word renewable in front of what is basically a fossil fuel. Because it has the same impact on climate as the methane that comes out with drilling and fracking. I mean, it's that simple. So I just wanted to make that clarification because in doing some research, just as a matter of fact, the gas industry is very much promoting this idea simply because of the current business profile of the natural gas industry. It's not in good shape. And this is another way of trying to prop up the industry. And I don't say that. I mean, that's a fact. That's what I found in my research. So I just don't want people to think that because this is called renewable natural gas, that it's pure and safe. And you know what I mean. People can get the wrong impression just by the addition of that word renewable. Thank you. - Thank you. All right, to continue. - Proceed. - We were talking a little bit about non-methane volatile organic chemicals. So this is the variety of chemicals that are different, you know, that basically are different organic compounds other than methane. So as methane is destroyed by either our flare or engine or some other source, the emission profile, we talk about the other organic compounds that may be produced as a result of that destruction. We'll also be talking a little bit about RENS and RECs. I know that we've talked a lot about RECs as we're talking with our, through DME. And as we move forward, we're gonna be talking a little bit about some potential RENS and RECs as a result of what we do at the landfill. We talk about RENS, specifically applied to renewable fuels and appropriate environmental credits as such. And again, when we talk about RECs, we're talking about the generation of energy and the trading of those renewable energy credits. So they're basically the same thing except RENS are tied to fuel, RECs are tied to energy. So what is landfill gas? Again, it's produced in the landfill itself. You'll notice that it starts with the waste that is in the landfill. We have wells, the methane is collected through headers. It comes through a vacuum at where it may be flared or used for some beneficial reuse. Currently, we have a generator at the facility producing about 1.6 megawatt and it's used to provide energy to city of Denton homes. However, there are other options and opportunities for methane to be used, whether it's what we call low BTU, where it's used for heat in some industrial source, arts and crafts, just something to burn for the heat value or we can further refine it into high BTU gas where it's put into a pipeline and maybe used for vehicle fuel, maybe used in your home for your hot water heater or your stove or anything else. So we're taking the existing landfill gas and purifying it and making it just beneficially reusable in the neighborhood. When you currently look at what's happening to our landfill gas or the composition of our landfill gas, we have about 53% that is methane only or that's what the composition of the gas is. About 38% of that gas is carbon dioxide and the remaining 9% is oxygen and other what we call balanced gases. So nitrogen and hydrogen sulfide and other gases that occur as a result of the decomposition of the organic waste in the material. So again, this is what our landfill gas component looks like. Currently we're burning this unfiltered, untreated and our engines allow us to do this but depending on how we decide to manage our gas in the future, we may have to treat it in some way, shape or form. Landfill gas management is very heavily regulated into sub activity of what we do at the landfill. Currently both state and federal law require us to have plans and programs in place to capture that gas and manage it. Our permit also requires us to have a program in place to manage the gas. We also have permits and registrations to run the electric facility that we have out there as well as maintain the gas flare that is on the site. Currently our landfill gas is managed by, we have 110 wells in the landfill right now proper that is currently collecting gas from the waste mass that is in place. About a month ago, DME bought the assets and the company from DTE, which operates our landfills gas to energy facility where we power an engine that turns a generator, again, generating about 1.6 megawatts of energy from that. We are nearing the end of life on this facility. When we first contracted with DTE, the contractor was to run through 2024. And this is sort of a perfect storm. Prior to DME acquiring the DTE assets, we were thinking about what the long-term use would be after 2024 and we had actually started some planning work for what we might have to do in this next three years to ensure that we're managing our landfill gas appropriately. DTE, DME currently owns the facility and we're working with them in this next step. Even though we have a landfill gas to energy generator on the site, we generate more methane than what the engine can use. So we have a candlestick flare on the site to manage excess gas, burn it off. And then also when the generator is down for maintenance or other repair, then the candlestick flare that's on the site is sized appropriately to manage 100% of the gas, to flare 100% of the gas that's at the site. Currently the city of Denton Solid Waste Recycling, we do receive an annual rent payment revenue share of about $145,000 a year as a result of this activity. And as I've stated on several times already, the power that's generated is used by Denton residents to power their homes and with the electricity. Currently the city of Denton Landfill generates about 360,000 cubic feet of landfill gas per year. In the 2018 Landfill Gas Emission Report, we noted an increase of about 6.8% of generation. That means, and as a result of us putting additional wells in this, excuse me, as a result of anticipated increased waste acceptance, or regional growth, regional waste transport dynamics, that is what is driving that calculation. Now, again, this methane stays in place in the landfill until it's extracted. So even though we may be generating anymore, it's remaining in place and not getting into the atmosphere. When you look at the emission capture, we've actually increased that by 31% over 2017. And again, that's due to the increased number of extraction wells we installed earlier this year. You may remember there was a contract to install 15 additional wells at the facility. We've increased the size of the header and as a result, we've been able to capture and manage the gas that we are producing. And again, the landfill gas to energy generator was already running at capacity. So these emissions are destroyed through the flare. And again, the remaining through the engine. Do need to underline that Denton is compliant with its landfill permit requirements, as well as the federal and state landfill gas management requirements with the activities that we currently are using. As I stated a couple of minutes ago, in this three year period, before the end of the DTE contract, we knew that there were different options to potentially manage our gas. And as the landfill continues to fill and generate gas, we wanted to make sure that we were using, managing the landfill gas that is in the most appropriate and environmentally sensitive manner that we could. We went out and we hired SCS engineers to evaluate options based on what our historic landfill gas generation profile has been as well as what our projection is going forward to the end of life on our current landfill permit. What they've done is reviewed landfill gas generation for the next 20 years, and they did an economic and technical screening of the alternatives. And basically we find that, when you look at these alternatives out there, electric generation like we're currently doing, medium BTU and high BTU for natural gas pipeline injection. What they found looking through this and through the calculations is that we do have sufficient landfill gas to support beneficial reuse. But when you look at the financial portion of this, really only flaring and high BTU management are financially viable. Meaning that there's no subsidy that is required from any city of Denton rate payer to support or drive that management process. And we'll discuss the economics here in just a minute. And when you look at the return on investment for high BTU, it's driven by what our current natural landfill, or excuse me, what the current natural gas prices are, as well as what the rent and rec market are currently doing. So again, there's a lot of moving parts here. When we look at what our options are, again, flaring, we're gonna burn it. Landfill gas to energy, we're gonna generate as much electricity from a generator on site and then burn any excess in our flare. From a medium BTU standpoint, we did not consider that only because based on current zoning and current industry in the area, there really is no local industry that would be able to use this heat. And in addition to that, it would require stability mute pipeline, which would require additional right of way acquisition and we would still need to flare. So, and then from the high BTU standpoint, again, we're scrubbing the landfill gas to make it 99.94% methane or better pipeline quality injected into the pipeline. And again, beneficially reused in the homes of Denton residents, cooking, vehicle fuel, hot water, things of that nature. What I do need to underline here, regardless of the option that we choose to go forward with, a flare will always be required at the landfill. First of all, it is a regulatory requirement, but secondarily, it is efficient for managing any of the gas that either may be excess or as a result of maintenance on any of the facilities that we, as we move forward. This is really a telling graph because it talks about the relative cost, net cost of our different options here, coupled with the environmental benefits of these alternatives. Along your X axis here, to the left side, you've got a very, very high environmental impact, very high emitting opportunity. As you move to the right, the environmental impacts decrease from the Y axis, very low cost, net cost to residents, meaning it'll be either be cost neutral or actually generate revenue for the city up to a very high control cost, which would mean there'd be sufficient subsidy by Denton rate payers, depending on that option. Our current option is our landfill electric generation facility. It is expensive to do, very high on the maintenance, and as a result, it is very, very costly, and as you can see here, fairly high environmental impact. As you move forward, again, we're not gonna be evaluating medium BTU because we don't have a customer to do that, which leads us to either flaring or high BTU from a cost benefit analysis related to environmental benefit and fiscal cost. On your high BTU, which again is the program we're gonna be recommending at the end of this presentation, it has a very high upfront cost, but again, over the life of the project itself, it has the lowest net cost because again, we have a sale and a rent and a rec that will help subsidize this outside of city of Denton rate payers. From a relative emission of our options as we move forward, you can see that between the flare and the engine and the high BTU, the high BTU facility again, is the lowest emitting from the process itself. The high BTU does not take into account the end use, whether it's at your stove, at your hot water heater, whatever the vehicle that's using it, this is actually the process itself. And again, this evaluation is based on our approximately 36,000 cubic feet of landfill gas that we produce in any given year. So as a result of this, we would anticipate that only 2.75 tons of carbon monoxide would be generated from the conversion of that 36,000 cubic feet and so on and so forth. From the flare operations, again, federal and state law require that we have a flare on site and it'd be operated. It is currently sized to manage the complete build out of our existing landfill permit, 1590A. Should the city be successful in obtaining its expansion for its 1590B, then the installation of a second flare or a larger flare will be required to manage the landfill gas that will ultimately be generated at that facility. Again, if we're looking at from a flaring standpoint by each control technology, if we're only operating a flare, then it will operate 24/7, 365. If we're looking at landfill gas to energy, again, it will continuously operate only because we have to flare the excess gas that we cannot currently use to run a second engine. And based on current growth curves, it suggests that it would be at least 20, 25 before we would have sufficient reliable gas to put input a second engine at the facility. Bringing this back to medium or actually high BTU plant, we would estimate that the flare would operate less than 1% of the time and really only during maintenance startup and shutdown. Ideally, you wanna capture every molecule of gas that's produced, put it in a pipeline for beneficial reuse at the end of the day. When you look at the cost benefit analysis, again, a lot of the cost for a high BTU facility is an upfront capital cost of about $23 million. And there's options for the city to operate, own and operate it ourselves to contract with the third party. But again, you'll see that the rate of return, net present value on these facilities is fairly impressive. If the city owned and operated its own facility, we would anticipate that the net present value would be about $18 million. Third party and paying royalties back to the city, that would drop to about $1.5 million, only because again, the bonding and the indebtedness on the front end by that third party taking those risks, it would significantly reduce the amount that we would be able to recover. From the city's own electric generator, again, you'll see that over the over 10 year, there's a net negative value in that only because of the price of operation, as well as the cost of the gas and the energy. And as a result, we don't propose that we move forward with the electric generator. Based on what we anticipate average annual income, if the city owned the high BTU facility, we'd anticipate a net income of about $2.5 million a year. If we had a third party own it and operate it and pay us royalty back, that dropped us down to about $200,000 a year. However, looking down to about 20 years, if we took this out to 20 years, that third party royalty would jump up to about 1.75. And again, that's a result of the upfront cost to build and the debt service on that. Again, as we look at high BTU facilities, the major variables from an economic standpoint, again, the price of gas on the open market, the rents and the wrecks that are out there, how much those would be able to cost. And again, capital cost, again, upfront is about $26 million to build or site one of these facilities. Depending on, and this does not include the cost of a flare or any gathering system, because again, that we're required to have that system regardless of which path we go down. So we did not include that cost in the evaluation moving forward. As a go forward, staff is gonna recommend that we would develop a high BTU at this high BTU facility at the city of Denton landfill and actually prepare an RFP to identify a third party to own and operate the facility as we move forward. Again, supporting our long-term vision of the solid waste program, minimizing environmental impacts and creating a high probability of return on investment to the city of Denton landfill. In this time, we would also work to shut down the existing electric generation facility only because it is end of life and the cost to rate payers is significant. And we would flare the existing gas while we're trying to bring a new system up. We anticipate it would take about one and a half to three years to bring up a high BTU facility. We would have to go through engineering, preparation of RFP, the design, the construction, the permitting, and then facility startup. And depending on whether we're using a package plant or we're building a basically a greenfield facility from dirt to a fixed construction site, that's what the variable is on that. So that is what our recommendation is. And at this point, I'd like to open it up for discussion and ultimate direction supporting this proposal. - All right, question. Karen had her hand up first. - Okay. - I just had a quick typo on page six, we've got the 360,000, the amount of gas that's generated. On slide six, you've got 350,000, thousand. - Okay. - You might wanna get rid of the extra thousand 'cause that's gonna be confusing. - Thank you for catching up, we apologize. - Yeah, Brian, good presentation. One suggestion, I didn't see the initial upfront capital outlay of, I think you said 26 million for this facility. You might wanna add that somewhere to your presentation because when I first looked at the numbers, I thought, gee, $18 million is better than $1 million. So why don't we go with the 18 million? But when you throw in the upfront capital cost, that explains that better. Second thing, do you have any idea of what the physical size or the footprint for this facility would have to be? - We would anticipate it would be about an acre and a half. - Okay. - And the capital cost is on slide 13. - Okay, I guess I missed that. - Yeah, 'cause I went $26.1 million. Yes, Ed, go ahead. And then Charlie. - Yeah, I went back and I looked at the TCEQ permit application that Brian referenced, the 1590B. And I saw in there that the city completed what was called SSO, which is a source-separated organics composting pilot study in early 2011. And subsequently, they were able to operate this facility effective January 9th, 2012. And it says that the city receives SSO materials, that is source-separated organic materials, such as produce, meats, beverages, and other vegetative materials, such as yard waste, at its organics composting facility. My question is, is the city currently operating a composting facility that takes food waste as a major component? - Not as a major component. In our current yard waste program, you can use vegetable clippings and things of that nature, but no post-consumer material. Part of what our permit application under 1590B allows us to do is take that information that was obtained from the pilot program that was established and make it a permanent facility. So it allows us the permitting to do it full-time going forward once the permit is awarded. - Okay, if I can follow up on that. So the composting facility is in place then, is that correct? - It is the dino-dirt facility that we currently have. So it takes the yard waste, takes the biosolids, and we do have a couple of commercial customers that we do take organic material from. So waste fruits and vegetables that have not been sold at any post-prepared food waste that cannot go into our facility. - Okay, good, I'm glad to learn that. Now my question is, why isn't an expansion of the composting program and an accompanying cost examination in comparison with this $26 million project, why is that option of expanding the city's current composting program, why is that not also an option in this case to help manage the landfill gas production? - There are several reasons. First of all, 1590B permit allows us the, will allow us the opportunity to actually create a composting program that you're speaking of. Secondarily, our comprehensive solid waste management strategy will actually look at the cost benefit related to that and give us some strategies to move forward to make that an effective policy. And thirdly, regardless of whether we take, have a compost program in place or take material or not, the city of Denton's landfill will always generate landfill gas. And we are looking at the manager of that material forward with this specific program. - I understand that. And, but it just seems to make common sense that the easiest and perhaps most successful way to reduce the methane would be to reduce the amount of methane generating materials. And I have a question. I mean, I don't understand why this is being presented before we've even seen a solid waste strategic plan. We won't see that until next month. So I think this is sort of jumping the gun. I think there's a lot more work needs to be done with this $26 million investment. And that's a lot of money, needless to say. And we need to find out what the options are with expanding our composting program. And I say this because I've done some research and seen what other cities have done and the results of it and the financial and environmental benefits of it. So I would feel very much more comfortable with giving direction on this after we know more about other options. And especially after we've seen this new strategic plan. I cannot see giving direction to move ahead with this now until we know what the big picture is. Thank you. - Well, and this is Tony, just to be clear. So the proposal from staff today is not to do the $26 million option. So just to be clear. And then the other item that I'll mention is we do have an upcoming discussion, I think with the PB and the council, also to talk about dyno dirt and biosolids and some additional requests that they've made that may also go to answer some of your questions. But again, I just want to be clear that the recommendation from staff today is not to do the $26 million investment. - To work with a third party, correct? - That's correct. - Which would come back to this board before it's approved. - Absolutely. - Does that give you more comfort, Ed? - I would still like to have the expansion of the composting program included as an option. - That is going to end up being a separate budgetary program that we'll do the research for you, try to figure out how we get that off the ground. But that is wholly independent of this particular issue where in this particular program, we can actually end up doing both if the PUB and the council want us to add that service. But you're talking about a program addition that is currently not budgeted and that we need to do the proper due diligence on. So nothing's going to hold us back from that if the council and PUB want to do it, but it is completely independent of this project where we're asking for that approval. - Okay, thank you. But the bottom line is, according to the, what this permit application says, is that the composting facility has been permitted and is in place. - The yard waste. - Yeah, the yard waste permitting, yes. And there's absolutely nothing preventing us in the upcoming years we're working on the next budget. If we want to put a program like that in place, there's zero preventing us from doing that. It's going to have no material impact at all on Brian's recommendation. It's just going to be a, it would just be a separate program that you decide to offer if you choose to do that. So we'll do the research for you, bring that back to PUB and council, let you know what the rate impacts might be of that and move forward just like we would any other program. But I think staff's already committed to you today that they'll get that research done for you. - Okay, thank you very much. - Yep. - Charlie, I think you had a question, Charlie. - I did. First, a comment on Ed's points. I think the idea that if we could cut our food waste input into the landfill by half, that would have a material effect. So I think it's certainly something worth looking at and considering. So I agree with Ed on the idea of checking on that as an option. The other question I had related to Karen's question, slide seven, the landfill currently generates approximately 360,000 MCF. And my question was just to qualify, I think Karen's assumption was that it's either 359,000, it's either 359 MCF or it's 359 in MCF. Can somebody answer that one way or the other? I have the opposite assumption. That's why I was curious. Is it $600 or is it $600,000 worth of natural gas per year? - I believe that it's 360,000 cubic feet of landfill gas. - So it's a total of $600 worth of natural gas? - The gas is on the MMVTU standpoint. So it's a volume to a heat conversion that you'd have to go through. - So clarify one more time. Are we talking about $600 worth of natural gas or $600,000 worth of natural gas per year from the landfill per page seven? - I will have to come back and get that answer to you. Go back and look at that. - I don't think any information's in there if you're talking about mass versus energy. - Yeah, there's a converging. Russ and then Billy. - Hey, quick question, Brian. When you solicit requests or proposals from various third-party companies to do this, I would suggest that, well, first of all, I'm not that much aware of the physical equipment that's required to be in this enrichment facility, but I assume there's some kind of a compressor. Do you know, is that right? That has to compress this? - Yes, there would be some compression required. - Okay, just as, and knowing the proximity of some homes to the landfill, you might want to include in your request for proposal some kind of a limit on the noise that this thing is going to produce. Maybe measure so many decibels 100 feet away or 200 feet away or whatever it is because, and where it's sited could be important also. - Correct. - Just to make that suggestion to look at that and think about that when you're getting these proposals. - Yes. Thank you. - Billy. - Okay, mine was about the third-party agreement, too, which I'm a huge fan of. And I would assume you guys put this all together, but we've had third parties in our landfill before it hadn't worked out. So just want to make sure we've got some sort of agreements to take possession of equipment. In the event that they don't fulfill their agreement. - Thank you, Billy. I had that same concern down this road before. I'm assuming we've learned, so. - Absolutely. - Any other questions, comments? Go ahead, Karen. - Yeah, sorry, my computer blanked out while Charlie was talking. I don't think it was personal, Charlie. When I pay for my natural gas, I'm paying Atmos. I haven't heard their name mentioned. Are they involved in this in any way? Would these be separate pipes from theirs? - No, Atmos would be the transporter of the gas. So Atmos would be like the NTTA. They own the road, you pay them, but you don't buy your car from Atmos, so. - Oh, that was a nice way to put it. - Yeah, thank you. - I just want to clarify, even if we did a food composting program, which I'm actually in favor of, especially with a lot of waste coming out of restaurants, it's not going to change the fact that we're always going to have landfill gas to manage, correct? I mean, it might reduce in the future. - That is correct. - Okay, all right. That's the clarification I needed, is that this doesn't go away even if we add additional programs. - And as a point of clarification on slide seven, that is $360,000, so the end cost would be $600,000. - Thank you. - You're welcome. - All right. Consensus. I'm in favor of moving forward with this, understanding it will come back before us again. Russ? - I agree, I agree. Yes. - Barbara? - Yes. - Okay, okay. - And Susan, this is Tony. I just want to make sure, too, that the PV understands that part of the recommendation is that we would shut down the current generating facility and flare the gas in the interim. - And how long, what's the time period? That would be 18 months to three? - One and a half to three years, we would have that other facility in place. - And that puts how much into the air? It's the least. - Brian has that information. - Pull this back up. So if we go back into this slide here, again, it is better than running the engine during that time. So we would look at 45 tons of carbon monoxide, approximately eight tons of nitrogen dioxide and a 10th of a ton of the non-methane volatile organic chemicals. So again, it would be less impactful than running the engine during that time. - Okay, all right. (clears throat) I'll wait for you to take it back down. All right, that doesn't change for me at all. It's better than running the engine and losing money, too. Ed? - Yeah, I don't feel comfortable with being, saying, moving ahead. I think that I would want to see what the impact would be of a more robust composting program. - Okay. Charlie? - Well, I just want to say-- - I like the idea. - I thought you said Charlie, I'm sorry. - That's okay. (laughs) Go ahead, Charlie. - I like the idea and I'm in favor of moving ahead with staff's recommendations. I do think Ed has a good point, though, that if we were to convert half of that food waste into compost, we would not have to deal with that at the landfill. Now, I assume it would still happen during the composting process, but we would be generating something worthwhile. So I think we should look at the economics of that as well. - May I add something to what Charlie said? - Sure. - Composting, composting does not, just as a matter of clarification, composting does not create methane. - Okay, thank you. - Yeah. It's an anaerobic, absence of oxygen is what causes, from what I learned the other day. So methane is not produced by composting, thank you. - It can be odiferous around there, but yeah, it does not. Charlie, I mean, Billy. - Oh, I was gonna ask, as we can take five after this. - Oh, sure. And Karen, but are you in agreement, Billy? What's your opinion? - Yeah, five minutes is good. I just wanted to say I support the proposal. We're gonna have to do something with that gas and there will be gas no matter what. I'm very curious about Austin's program. My daughter was not impressed with it, but maybe that's just youthful idealism. She's, it was a sustainability major, UT, varying all that kind of stuff. Much smarter about it than I am. So I would be very interested in getting some comparisons with how Austin's established program for food-based composting has been working, especially in regards to their landfill, which is bigger than ours, I believe. But otherwise I support the program. - Well, Brian, I guess you've got your direction. - I do, and I appreciate the discussion this morning and the commitment to move forward. - All right. - Thank you. - So I guess we'll take a five minute break. It is now according to my clock 10.21, so we'll be back 10.25-ish. - All right, you're on. - All right, we are back on. We're still in work session. And after this item, I am going to be calling us back into open session and then asking for a adjournment into closed session. But right now we're on, receive a report, hold a discussion and give staff direction regarding water, wastewater, drainage, and electric capital improvement program. - Good morning, PUB members, Chair, and Nick Vinson, Assistant Director of Finance. I'm happy to be in front of you today. We have three presentations to review the detailed utility projects with you. I know this is something the Public Utility Board requested during the budgeting process. So we felt like it was appropriate to bring back that discussion with you. Really quick, before we get started, I want to start the framework or what the presentations will talk about. And each of the presentations will have a detailed discussion. regarding the utility projects. And the presentations actually do not get into a great level of detail regarding those projects that are city-wide, those larger projects. So as one's a multiple department is being involved in those projects. We do have Becky Devaney on the phone today. If there's any questions, she'll be happy to address them. If you have questions regarding those city-wide projects that she can address, otherwise we'll walk through the utility projects. And then Susan, if it's okay, I'll go through the presentations. If there's any operational questions, if we can wait until the end, I can turn it over to the directors and they can address those questions. All right. So we'll start with water. Really quick, what I'll do is walk you through an overview of the presentation. This is consistent for each of the utilities, but really we'll look at the project execution and management, how the process previously was, how it is now, and then what improvements have been put in place by staff. After that, we will look at 31 of 56 projects. So in your backup material, you should have got a detailed project list of all the active projects in water. The presentation in front of you will cover 31 of those projects. We'll not discuss every one of those 31s. They are listed on the slide, but we'll discuss a portion of them. So I'll go through those with you. For presentation purposes and be consistent with the budget, we have grouped these projects into five different categories. The first one being plant CIP improvements, the second one being field service replacements. The next one being your service projects, for example, which is professional services. And then we have some state highway relocations. And then we'll talk about those future projects that were included in the budget. And we will be bringing those discussions back to you in the near future. So we'll get into that discussion also. So really quick, we wanna review the previous process that was in place from 2015 to 2017, basically prior to 2017. Project planning and delivery. There was a lack of project prioritization. There was a focus on short-term cost savings. And then there was poor project execution. So really none of those major projects getting completed. And I'll show that to you on the next slide. There were silos that existed within the organization, which minimal coordination between departments. And that has since been, those silos have been broken down. Departments are talking to each other now, which is great. And then for the water utility, there are three main projects that we wanted to communicate that have been moved along here recently that were previously on hold was the North-South water transmission line, the Aldridge-John Payne transmission line, and then Elm and Locust phase two. And then post 2017, we have had decreased design and construction delays, and our continuous focus on cost containment transparency and emphasis on the city's core values. And that was something discussed with the public utility board and city council during the budgeting process. So really when we're looking at a project and looking at how we wanted to communicate this to the public utility board, we started looking at project activity. How much money has been spent or encumbered on these projects? And really, project movement is one thing we've been looking at in the finance department. So we put this table together for you. There were a couple of major projects that make up a big large portion of this increase that I'll review with you. The first one being the Lake Louisville water treatment plan upgrade and solids handling. The next one being the North-South water main. And the third one being that Aldridge-John Payne that I mentioned to you. So in 2017, you can see the year to date activity of $186 million. In 1920, this actually increased to 258 million. So you can see that increase about 72 million. So really showing, since 2017, post that time period, when we broke those silos down, we really started communicating between departments, really started to focus on project execution and getting those projects completed, really increased that project activity. So I wanted to point this out to the public utility board, setting the stage for the discussion today, and then what's to come for the other utilities. And as I'd mentioned on the previous slide, minimize this up here, we have five main categories that the water utility projects are grouped in. The first one being your plant CIMB improvements. The next one being field service replacements, service projects, special professional services, state highway relocations, and your future projects. So those ones included in the budget and then those discussions I'll be coming back to in the near future. So this is the template we've came up with the public utility board. This template has been shown to city council in the past. We've changed a little bit. So I'm gonna walk you through the table just to make sure we have the basis of what the discussion will be based on. And then we'll proceed to the project descriptions. So the left-hand side, you can see the project name of each of the projects that'll be discussed. And these are plant and CIP improvement projects in the water utility. We do have this indicator dot, it's currently green. We do use this to look at the schedule of projects. You can see down here at the bottom, green meaning on target, yellow meaning risk and opportunity, red mean off target, and then a gray color just meaning NA. And then we have our estimated completion date. We do currently show this as a month and a year. Moving forward, this may change to a quarterly number, but currently we have it on monthly. So September, 2020, for example, this project is scheduled to be completed. So at the end of this month, it is coming up. EAC, which is the estimated at completion. You can see that amount here. So what is that project gonna cost when it's constructed? What the current budget is, what's currently allocated to this project, the $440,000. And then if there's any future funding, we've shown you your '21 and '22 on this slide to identify some future funding on some projects that are listed here below. And then the revised total, you can see right here to the far right-hand side. So really quick, for plant improvements and CIP improvements, I wanted to walk you through the Lake Louisville Water Treatment Plant, also abbreviated as LLWTP upgrades. This is upgrades to the Lake Ray Roberts facility, including zebra mussel control. And this project is scheduled for completion in 2021. And then the second project really wanna bring to your attention is the Lake Louisville solids handling. So something we've talked about in the budgeting process before that you can see the construction of new residual sludge dewatering facility. And this project is scheduled for completion to April, 2021. Couple of things on the side. So you can see up here, the regulatory performance upgrades. It does have an asterisk next to it. This does indicate this project is impact fee eligible. So this is a growth capacity project. So we can use those impact fee revenue dollars that are coming in to fund this project. This is one we discussed with the Public Utility Board of having $18 million in funding in 2021. And this was the project that enabled us to push that Lake Ray Roberts expansion out, the upgrades to that facility design in '24 and the construction in '25. So that is a great project. Field service replacements. There are several of these projects. I think there's roughly 10 on this slide. There is another slide that will address these also. And what this is, this is simply replacement of existing infrastructure in the city. So infrastructure that's been put in place several years ago that the department is deemed to be needing to be replaced, maybe because of breaks or just aging infrastructure. So you can see same table format as we had on the previous slide. We do have a couple of these. You can see field service replacement for the ore water. This is water main replacement project is approximately 800 feet from Bolivar Street to Locust. This project construction has been completed and we're currently going through the closeout phase, which is scheduled to wrap up at the end of this month. Avenue B water, which is water main replacement project, approximately 1200 feet from Eagle to Underwood. This project is scheduled for completion in September, 2020. And then when I get to the future project slide and it was talked, we actually talked to you about it during the budgeting process. And I may mention this before all field service replacements in the water utility or revenue funded. So we're actually not debt funding that replacement infrastructure, we're actually revenue funding that replacement. So there's a positive thing for this utility. This is the field service replacement projects continued. About 10 projects in this slide also. A couple of the ones we're gonna talk to you about is Foxcroft and this is the water main replacement project approximately 3000 feet from Emerson to Old North. And this project is scheduled for completion in January of 2021. But then the next one is precision water line project. This is the water main replacement project of approximately 1500 feet from Airport to Die Street. So we can give additional detail on these projects. Definitely if it's something you'd like to hear, Preetem is present, the assistant director for water and wastewater that can address these at the end of their presentation if you have any specific questions regarding those. And the next ones are the service projects. So those consultants or those professional services that we have open that we're currently working on the water utility. The first one being the Lake Louisville transmission pipeline assessment. And this is an important project for the water utility. So it's a condition assessment of a 20 inch water line. This project is scheduled completion is September 2021. So basically a year from today. On the next one being the risk assessment energy response plan. And this is preparation of a risk and resiliency study and emergency response plan for the water utility. We did wanna bring this to your attention. I think this is something the public utility board brought up in the budgeting process of being a priority. So we do have a project open for that as recently completed. Text on I-35 relocation. We did wanna show this project to you. This exists in the water and wastewater utility both. So you can see this is relocation of utilities that run next to I-35. It is part of the expansion project of that construction. EAC is currently 12.7 million. We do currently have a budget of 2.7 a planned additional funding of 8.2. And a little bit coming from other sources to make that project whole. So future project summary. This is something we showed to you in the budgeting process but I wanted to bring it back forward to you. We did add an additional column out here. So the entire CIP that you approved and the city council adopted on September 22nd included $51.8 million in water projects. And this table below summarizes 46.2. It really gave you the status of how those projects fit into this plan that I've been presenting to you on the previous couple of slides. So the first one being the regulatory and performance upgrades of 18 million. That's that project I talked about with you. And this was an existing project. So this is in funding enhancement to that project. We won't have to set up a new one. This one is already open. The next one being the Northwest transmission lines and booster pump station, 3.35 million. This is an existing project also. I mean, you can see that text.R35 relocations we just reviewed at 10.9. Elmond Locust, which is an existing project of 4 million funding. And then lastly, I wanted to point these out to you. This is that annual field service replacement number of 2.7. So when you see those field service replacement projects, this is where that funding comes from. We do plan to bring back a detailed discussion to you in January of 2021 to go over a detailed list once we have it finalized and what individual streets is made up of the 2.7 million. And then finally, we have some contracted field service replacements for the 2020 bundle. And then we had that bond election of 2019, which those discussions will come back to you in the spring of 2021. And then those next discussions, as we said during the budgeting process, we do plan to circle back with you in December. We are somewhat limited on budget or meetings in November and December with the holidays coming up, but we do plan to bring that back to you, the budget discussion and the rate discussion as promised in December during that one meeting that you have. And then coming back to you in January 2021 with a quarterly financial project update. This is something that staff plans to come back to the public utility board on quarterly basis to keep you updated about these projects. So we're happy to have this format together and happy to get your feedback today. So we wanted to get it in front of you. With that, that concludes the presentation, Susan. I'll pull it down for questions. - All right, Barbara has her hand up. Go ahead. - I just wanted to ask you about on slide eight, you've got a project there on Amherst that I drive down frequently. And it's due to be done in May, 2021. You finished out Hinkle and Amherst some time ago and it took a while. But I wanted to ask you about Amherst has finished and now there's heavy equipment sitting on the streets and the people were told over there that they were going to have to tear it up and put water lines there. And that street's just been done fairly recently. And I thought we'd gotten away from doing the streets and then tearing them up into the water lines. - Ms. Bressel, that's a great question. And Susan, what I'll do is I'll turn it over to Preet Tim to address the operational questions really quick and he can answer that question. - Good morning, Preet Tim Deshmukh, Deputy Director of Water Utilities. To address your question, yes, we're coordinating closely with the streets department and we're working with them. If situations like these do happen where a street has gone in a couple of years earlier, three or four years early, we do work with them. We will reassess what the water line conditions are and look at this project if that's the case. But definitely we intend to not be in the neighborhoods over and over and moving forward, we're working with streets department as mentioned in the presentation of breaking down silos. So definitely we'll reassess this project. Well, I thought we'd done a pretty good job of following along doing the water lines and then the street. And then this one pops up and I'm thinking this, right now I'm struggling to get into my neighborhood. It's going to be better and I understand that very well, but now there's, well, Amherst was just one I have a particular knowledge about, so thank you. - Is there another hand, Charlie? - Quick question regarding, I think it's page four, the slide titled water project execution and management continued. And I'm a little concerned by the project activity by year 2019 and 20, you showed $258 million. If I divide that by 130,000 people in the city, I get $1,984 per person. Can you tell me what you mean by project activity? And that's a pretty staggering dollar. - That's a great question. And I can even pull that up for the P even visually quick. Hang on just a second, because this is consistent across the utilities. So it's a great question. What this is, this is life to date. So this actually doesn't represent a spin. What this is, is this 186 million and this 258 million is expenses and encumbrances for all projects in the water utility life today. So this doesn't mean, for example, we spent 258 million in fiscal year, 1920. It does mean, however, that from 1819, we had 221 million in expenses and encumbrances. That number did increase to 258 in 1920. So some of these major projects are the ones that accounted for that large increase that you're seeing there, which is the Lake Louisville Water Treatment Plate upgrade and solids handling and at North South Water Main, which was a significant project. So hopefully it answers your question. The large increase was here, was mostly attributed to these projects. However, the total amount that you see is life to date for the water utility. Mr. Parker, does that answer your question? - It does. Yes, the difference is 258 minus 221, 37 million dollars in new spending. - That is correct. Yes, sir. That's new spending or new money that's been encumbered as those projects continue to be executed. So it would be the variance. - So if we divide that 36 million by 130,000 people, we spent $284 per person last year on water. I don't have the math in front of me, Mr. Parker, but that's the way it comes out. Absolutely. That is correct. And that'd be attributed to some of those large projects, those infrastructure projects that are out there that are 10 plus million dollars. Absolutely. - Okay. Thanks. - Other questions? All right. - Okay. And Susan, I will pull up wastewater really quick if no one else has any questions for water. Same thing here. We'll get through it. If you have any operational questions, pretend we'll come back up and address them. If there's something to do with the plant, Frank is on the phone that can address them also. Also, Kenny Banks is available. So I won't go through this every bullet point like I did in water, but really the project categories, we will look at 30 of 74 projects that were provided to you in your backup material. Those main categories are plant and CIP improvements, field service replacements, service projects with professional services, your state highway relocations, and your future projects in your next steps. So consistent with the water presentation. And one thing we're trying to do just for everybody's information is really keep this presentation template consistent for the utilities moving forward. So any feedback you have for us is great. And this is the previous project management. And you can see between 2015 and 2017. So pre 2017, we talked about those silos. We talked about those poor project execution. Staff's really done a great job in the water utility and the finance department breaking down those silos and city-wide for that point. Some of the large projects for the wastewater utility is the Hicker Creek Interceptor 1 and 2, the Dry Fork Interceptor, the Elm and Locust Phase 2. And then current process post 2017 as we talked about before, really just staff's continued focus on cost, containment, transparency, and emphasis on the city's core values. Project activities through wastewater utility. Similar to water, we do have some major projects identified here. The first one being the Teasley FM 2181 Text Not project, which I'm sure everybody's familiar with. The Hicker Creek Detention Facility, the Footward Drive Relocation I-35, the Hicker Creek Lift Station upgrades. And then really looking at that project activity, which is that spin and encumbered amount. In '16, '17, we had 114 million. In '19, '20, that increased from 158 million. And so the large increase you see between these years is mostly attributed to these projects that are listed here, four of them total. The five main categories for the wastewater utility, plant and CIP improvements, field service replacements, service projects, your state highway relocations, and those future projects that were included in the budget, and it'll be coming back to you at a future discussion. So same template, same table as in the water utility. We have about 10 projects listed under plant and CIP improvements. We did wanna talk in detail with you, two major projects here. The Clear Creek Basin Pump Station. This is a wastewater lift station construction to provide wastewater collection capacity in north of loop 288 in the Clear Creek Basin. This project will be completed in an estimated completion date of May of 2023. And the project will be fully funded in fiscal year 2022. So as you can see that project listed up here, you can see the EAC of 13 million, the current budget of 493, with 3 million coming in funding in 2021, and then the rest of it in 2022. A lot of times staff tries to implement this funding over multiple fiscal years to lessen the impact of rate payers in the water utility. And the second project will be the Hicker Creek lift station upgrade. This is replacement of aging wastewater lift stations to provide capacity and reliability. This project should be completed in December of 2020. Similar to water really quick, I do wanna point out to the public utility board, which is important, the impact fee eligible projects. You can't see a few of them here with asterisks of the West Weather Storage Facility, the Hicker Creek Detention Facility, and the Clear Creek Basin Pump Station that we talked about shortly ago. So we do look at those projects and apply the appropriate amount of impact fee funding each year. Filled service replacement, similar to water, these are cash funded projects that are budgeted from the operating funds, so ultimately funded from the rates. So we're not debt funding these replacement projects, we're actually cash funding them. And the first project I'm gonna discuss with you is the Holiday Park 2, which is a filled service replacement, that's what this stands for. It's a sewer main replacement project approximately 6,700 feet throughout the residential neighborhood of Holiday Park. This project should be completed in September of 2020. And the second one being Woodland and Cherrywood Sewer. This is sewer main replacement project, approximately 2,400 feet throughout this residential neighborhood. And similar, this would be completed here in the coming two months in November of 2020. Filled service replacement, this is continued. Going down the list here, I'll put on a couple of them, and Preetem can talk to these later if you have questions. We do have a couple of them with the yellow dot. So that yellow dot, just for your reference, I know it's different than the green one we've been seeing, but mean that there's some risk and opportunity in those projects. So he can address these in a little while if you'd like further information regarding these. But the first one I'll talk to you about is the Foxcroft Filled Service Replacement. This is water main replacement project, approximately 3,000 feet from Emerson to Old North. This project should be completed in December of 2020. And the next one being WWC, which is Amherst, which is the sewer main replacement approximately 2,100 feet from Georgetown to Hinkle. The service projects, those professional agreements are projects that we have out there for the wastewater utility. The first one we have listed is the border cowboy pump replacement. This is replacement of the pumps at the border cowboy lift station. And this project should be completed this coming May, but it depends on some text on I-35 widening schedule and impact. We are waiting to work with them on this project. The SCADA master plan, we are working to develop a master plan for SCADA system within the wastewater utility. We do plan that be submitted or completed about a year from now, September of 2021. The textile relocation, this project is part of water and wastewater both. So you can see the wastewater component is a little bit less than water. So 2.248 million, current budget is 480,000, but that additional funding coming in 2021 of 1.7 million, and this was included in the budget that she recently approved. Those future projects, this is something you saw in the budgeting process and during those meetings we had and ultimately the budget you approved. There was a total of 40 million in the 2021 wastewater CIP. The slide below in these projects make up 29.9 million of those. Similar to water, we have group them into existing projects and new. So some of the major ones we've talked about before it was a Clear Creek Basin Pump Station of 3 million that you saw on that. I think it was a second or third slide and this additional funding that's coming into that project and the current approved budget. Moving down the slide a little bit, you can see that solids handling project of 8.3 million. So this is a new project. So we'll set this project up and this funding comes in. Let me get that project started. And then annual field service replacements. This is that amount we budget each year for that cash funding of those replacement jobs and existing streets or existing right of ways. We will bring back a detailed list of what this 2.6 makes up in January of 2021 to the Public Utility Board. Then lastly, you can see that bond election of 2019 coming back to the Public Utility Board in the spring of next year also. And then the detailed budget discussion in December. I'm having that consultant come back, go through the rate discussion with you in that model that's recently been developed with the water and wastewater utility. And then coming back to you on a quarterly basis with a project update. Then I will pull it down for questions. Questions? I don't think there are any. - Okay. And our last presentation is electric. I'll go through this one. Then same thing here. We have several staff present to address your questions. Chris Lutrix here, Jerry Filder, Terry Nolte. They can be happy to come up and address any questions that you have at the end of the presentation. So the groups for electric are a little bit different than water and wastewater. Our first one being distribution of substations with a large portion of their capital plan. I'll review that with you shortly. The next one being transmission lines. And then we have feeder extensions and improvements, new residential, street lighting, and then those future projects we discussed in water and wastewater. Previous process, a little bit different than water and wastewater. So previously the overall system transmission and distribution CIP was created. Consultants were utilized to manage the progress of CIP projects. Really the new process and moving forward here recently in the last few years, we have increased engineering and budgetary review of projects, need, cost, and timing. This is a perfect example, as Tony mentioned earlier in the meeting, the elimination of the EECL substation. This did save rate payers an estimated 17 million, which that discussion did come forward to the Public Utility Board and City Council. And then we had that comprehensive capital projects and planning implementation as part of that budgeting process. Project activity for the electric utility. So you can see in '16, '17, we had 237.5 million. In '19, '20, this increased to 312.7 million. So you can see a significant increase over these years as we've implemented and put some new substations and transmission lines in place. The six groups within the electric utility, you can see distribution substations, transmission lines, feeder extensions and improvements, new residential, street lighting, and those future projects I'll review with you. So the table for distribution substations, very top one, which we'll discuss in detail with you, is that Hickory Substation Construction Project. It does have an estimated completion date of 2023, which I think has been mentioned earlier in the meeting. The EAC is currently 34.7 million, but the current budget is 6.5. We do have anticipated funding, as we talked about in the budgeting process, coming up in 2021 at 32.1, and then $900,000 in 2022, which would fund this project. Then you can see Brinker and Underwood, which are some future projects that are out there also. Transmission lines, we have several of them listed here. The first one being the RD Wells to Hickory, transmission tie-in. This is the reroute of the transmission line of 138 KV. And then the Locust to Hickory transmission line, this is a rebuild of the transmission line that connects New Hickory Substation to the new Locust Substation. And this has completion date, December of 2022. And this project will be fully funded in 2023. So if you go back up to this list up here, you can see the Locust to Hickory Transmission Line Project fully being funded in 2023. Next one being your Hickory transmission, UG and OG reconfiguration, which is the reconfiguration of transmission lines entering the New Hickory Substation. And this project should be completed in December of 2023. New residential, so we have about five projects listed here. They all do have a green schedule indicator. The first one being your DHS campus phase one. This was the extend the electric facilities for feeders to tie into the Bronco way to provide service to the new Denton High School. This project was recently completed, but we didn't wanna bring it to your attention that that has been completed. The next one being your pros, your Windsor Apartments, which is the extend electric facility to 330 new unit apartment complex at Windsor and I-35. Estimated completion date is this coming December, so in a couple of months. And the next one is street lighting. So this is something we mentioned to the Public Utility Board and City Council during the budgeting process. So the priorities set forward by both. So we have grouped the street lighting projects into three different categories, but the first two have an amount budgeted. The first one being existing street lighting and LED upgrade. We currently have 1 million EAC for this project. Let me go back. With 2021, that 1 million coming in and funding. And the additional residential LED lighting, currently 3.7 million EAC. You can see 3.7 million coming in in 2021 and in each of the future years. Some future projects that are coming up. And there's actually two slides in electric to talk about future projects. The first one being the I-35 East relocation between Mayhill and Loop 288. Estimated cost of this project is 1 million. And estimated completion is October of 2021. Bonnie Brafe's phase four relocation between US 380 and US 77. Estimated cost is 500,000 with the completion date of July of 2021. Skipping down the page a little bit, you can see the Kings Ridge phase one, which is 130 lot residential development in Toronto Way. Estimated cost of this project is 250,000 with an estimated completion of September of 2021. And then we'll continue to bring these back to you. Actually at that next quarterly update in January, we'll touch on these projects a little bit more with you. Future project summary. So the 2021 CIP for the electric utility included 65 million in projects. The six projects listed here below make up 55.8 of those projects. As we talked about, you got the distribution substations of 6.8 million coming in, which is an existing project that we reviewed. Your feeders, extensions and improvements, 9.45 million, which is existing projects. And then the street lighting that we talked about with 3 million. If you notice on the slide, it actually said 3.6, if I'm not mistaken, that through 600,000 additional funding into existing funding, the staff will be reallocated to this purpose. So this 3 million will be coming in in addition to that reallocation of funds. Transmission line of 12 million, 12.1 million, and then transmission substations of 20.7. And then this is the detailed budget and rate discussions coming up in December. And then the next quarterly financial project update will be in January, 2021. That concludes electric. And I will pull it down for questions, Susan. - Any questions? I don't see any. What do you need from us? - No direction, Susan. This was simply an update based at PUV's request of getting that. I think we had a couple of requests for it in the past. So this will come back to the public utility board on a quarterly basis. We just wanted to get the template in front of you and get your feedback today. So that's all we needed. - Thank you. All right then. I will call us back into open session. And then we need a motion to adjourn into our closed session. Is that correct, Larry? - No, actually what we'll do is you will just, you'll just go into closed session and then we'll need to come back into open session. - Come back in and then go in. - From closed to adjourn, yes. Yeah, we're just, and to let everybody know, we're just doing the same thing council is doing. So we're having all the boards and commissions follow the same path. - That's fine. Just keep me doing what I'm supposed to do. - Okay. - All right, we will adjourn into closed session. - And Susan. - All right, Susan. - All right. And we're back. We are adjourning the closed meeting and going back into open session. At this point, do we have a motion to adjourn our meeting? - So moved. - Second. - Second, all in favor, aye. - Aye. - Okay, we are adjourned, 1120. - Thanks.