Oct 23, 2023 City Council Special Meeting

WHAT? NO.

[00:00:01]

[1. Call to Order NOTICE OF OPTION TO RECESS INTO EXECUTIVE SESSION Pursuant to A.R.S. §38-431.02, notice is hereby given to the members of the City Council and to the general public that, at this work session, the City Council may vote to go into executive session, which will not be open to the public, for discussion and consultation with the City’s attorneys for legal advice on any item listed on the following agenda, pursuant to A.R.S. §38-431.03(A)(3).]

AND THIS IS A JOINT MEETING OF THE FLAGSTAFF CITY COUNCIL AND OUR WATER COMMISSION.

NOTICE IS HEREBY GIVEN TO MEMBERS OF THE CITY COUNCIL AND TO THE GENERAL PUBLIC THAT AT THIS WORK SESSION, THE CITY COUNCIL MAY VOTE TO GO INTO EXECUTIVE SESSION, WHICH WILL NOT BE OPEN TO THE PUBLIC FOR DISCUSSION AND CONSULTATION WITH THE CITY'S ATTORNEYS.

FOR LEGAL ADVICE ON ANY ITEM LISTED ON THE FOLLOWING AGENDA.

CAN WE HAVE ROLL CALL? MAYOR DAGGETT HERE.

VICE MAYOR ASLIN, PRESENT.

COUNCIL MEMBER HARRIS.

HERE. COUNCIL MEMBER HOUSE.

HERE. COUNCIL MEMBER MATHEWS.

HERE. COUNCIL MEMBER MCCARTHY.

COUNCIL MEMBER SWEET.

HERE. CHAIR RIGGLEMAN, I APOLOGIZE FOR MISPRONOUNCING YOUR NAME.

NOT HERE. UH, VICE CHAIR LOVERIDGE.

AYE.

COMMISSIONER ALTER. YES, COMMISSIONER BILLS.

HERE. YES, COMMISSIONER DILDAY.

HERE. COMMISSIONER NORMAN HERE.

AND COMMISSIONER RUDEL.

PRESENT. GREAT.

UM. OKAY.

WE DO HAVE A FLAG IN HERE.

UM, COUNCIL MEMBER SWEET, WOULD YOU LEAD US IN THE PLEDGE OF ALLEGIANCE.

NOW, ARE WE REALLY DOING. OKAY, YEAH.

IT'S ON. WE WERE JOKING YESTERDAY AND A HALF OR DID A HALF IRONMAN, AND I TOLD HER I WAS GOING TO MAKE HER STAND UP AND SIT DOWN ALL THROUGHOUT THIS MEETING. THANKS, MAYOR.

COUNCIL MEMBER MATHEWS, OUR MISSION STATEMENT, PLEASE.

YEAH. YES. THANK YOU.

MAYOR. I WOULD LOVE TO.

THE MISSION OF THE CITY OF FLAGSTAFF IS TO PROTECT AND ENHANCE THE QUALITY OF LIFE FOR ALL.

AND, COUNCILMEMBER HARRIS, I KNOW THAT YOU'VE DONE THE LAND ACKNOWLEDGMENT FOR THE PAST COUPLE OF MEETINGS, BUT WOULD YOU MIND READING IT TODAY AS WELL? YEAH, SOMEBODY WOULD GIVE IT TO ME BECAUSE I DON'T HAVE IT.

OH, THEY HAVEN'T PASSED IT DOWN RIGHT THERE.

THERE IT IS. OKAY.

THANK YOU VERY MUCH.

SORRY TO SPRING THAT ON YOU.

IT'S MY PLEASURE.

THE FLAGSTAFF CITY COUNCIL HUMBLY ACKNOWLEDGES THE ANCESTRAL HOMELANDS OF THIS AREA'S INDIGENOUS NATIONS AND ORIGINAL STEWARDS.

THESE LANDS ARE STILL INHABITED BY NATIVE DESCENDANTS.

BORDER MOUNTAINS SACRED TO INDIGENOUS PEOPLES.

WE HONOR THEM, THEIR LEGACIES, THEIR TRADITIONS, AND THEIR CONTINUED CONTRIBUTIONS.

WE CELEBRATE THEIR PAST, PRESENT AND FUTURE GENERATIONS WHO WILL FOREVER KNOW THIS PLACE AS HOME.

[4. Discussion and Direction on the Rate Study Financial Plans Direction on a financial plan for each water, wastewater, and reclaimed water fund.]

ALL RIGHT, SO MOVING DOWN TO ITEM NUMBER FOUR, DISCUSSION AND DIRECTION OF THE RATE STUDY FINANCIAL PLANS STAFF, PLEASE TAKE IT AWAY.

ALL RIGHT. WELL WE ARE HERE AS A JOINT WORK SESSION, AS YOU KNOW.

AND THOUGHT WE COULD FIRST KICK OFF WITH SOME INTRODUCTIONS FROM OUR WATER COMMISSION MEMBERS.

THEY'VE BEEN APPOINTED BY YOU TO SERVE AS AN ADVISORY BOARD.

OUR COMMISSIONERS ARE INVOLVED IN IN WATER IN VARIOUS WAYS, AND THEY HAVE A LOT OF KNOWLEDGE THAT WE THOUGHT WOULD REALLY BENEFIT A GROUP, A BIGGER DISCUSSION. THEY WORK IN THE COMMUNITY IN VARIOUS CAPACITIES.

SO WITH THAT, WE COULD DO INTRODUCTIONS.

SHOULD JUST SHOULD WE JUST GO IN ORDER THAT WE ARE AROUND THE TABLE? SURE. OKAY.

STARTING WITH COUNCIL MEMBER.

NOW IF YOU WANT TO JUST PROVIDE A BRIEF INTRODUCTION AND YEAH, I'M JOHN NORMAN.

I MOVED TO FLAGSTAFF IN 1981, AND I CAME HERE FOR A JOB AT.

I MANAGED THE INSTRUCTIONAL LABORATORY PROGRAM AND THE CHEMISTRY DEPARTMENT FOR 35 YEARS AND HAD A LOT OF HATS, BUT LEARNED A LOT ABOUT TOXICOLOGY AND RISK MANAGEMENT AND LABORATORIES AND EVERY OTHER HAT YOU CAN IMAGINE RELATED TO LABS.

AND YOU'RE WITH THE FLAGSTAFF WATER GROUP.

I'M WITH THE FLAGSTAFF WATER GROUP, TOO.

THERE'S A MEMBER TO BOARD, AND I'VE BEEN DOING THAT FOR ABOUT TEN YEARS.

SO AND WE'VE BEEN LOOKING AT WATER CONSERVATION AND ADVANCED WATER TREATMENT TO REDUCE HEALTH HAZARD FOR THE POPULATION.

THANK YOU. AND WE HAVE JOE.

YEAH. JOE LOVERIDGE WITH JAY FULLER IN TOWN HERE.

AND WE DO A LOT OF WORK ON THE WATER RUNOFF SIDE OF THINGS.

AND WE'VE BEEN WORKING IN TOWN FOR ABOUT 20 YEARS NOW.

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SO THAT'S ABOUT THAT'S ABOUT IT.

ROBERT FROM LONG BEACH, CALIFORNIA, ORIGINALLY FROM THE MORTUARY BUSINESS THERE FOR ABOUT 40 YEARS, SOLD THEM OUT, MOVED HERE ABOUT TEN YEARS AGO. I LOVE THIS PLAN.

I'M GOING TO FILE IT FOR SIX YEARS.

AND AND I LOVE BUSINESS.

SO THAT'S WHY I'M HERE.

I THINK WATER IS ONE OF THE MOST IMPORTANT THINGS WE HAVE IN THIS COMMUNITY.

THAT'S WHY I CHOSE WATER.

THANK YOU. AND I'M BEN RUTTLE.

I'M A PROFESSOR AT NORTHERN ARIZONA UNIVERSITY.

I'M ALSO A LICENSED PROFESSIONAL ENGINEER IN WATER RESOURCE PRACTICE AREA IN THE STATE OF ARIZONA.

I DON'T DO VERY MUCH CONSULTING AND DEFINITELY NOT ANY ON ON CITY RELATED TOPICS, BUT I DO A BIT OF RESEARCH.

I'VE WORKED WITH THE WITH WATER SERVICES ON TRYING TO VALUE WATER AND MEASURE SUSTAINABILITY OF WATER, AND MY POSITION AT THE UNIVERSITY.

I'VE BEEN ON THE COMMISSION FOR SEVERAL YEARS.

THIS IS MY THIRD TERM AND MY MY EXPERTISE IS IN WATER AND ITS POSITION IN THE BROADER SYSTEM.

SO BIGGER PICTURE ISSUES.

MALCOLM. MALCOLM.

ALTER. I'M AN ENGINEER AS WELL, SO I'VE WORKED HERE FOREVER AND RETIRED FROM HERE 7 OR 8 YEARS AGO.

I WAS ONCE UPON A TIME HERE, PRIVATE DEVELOPMENT ENGINEER.

I DID A STINT AS TEMPORARY CITY ENGINEER, AND MOST OF THE TIME I WAS YOUR STORMWATER MANAGER.

SO SURFACE WATER FLOWS, KIND OF DISCUSSIONS OUT JUST IN TIME.

RETIREMENT. THAT'S GREAT.

IT'S INTERESTING TO BE BACK IN THIS ROOM AND WANTED TO WALK DOWN THE HALL.

WELL, I HAD AN OFFICE DOWNSTAIRS TO AN ENGINEERING I DON'T YOU MOVED EVERYBODY AROUND, RIGHT? BUT MY LAST OFFICE WAS DOWN HERE ON THE LEFT.

AND WANT TO JUST KEEP WALKING AND SEE WHO WAS IN IT.

ANYWAY, IT'S GREAT TO BE BACK.

THEY WON'T LET YOU IN. YEAH, I NOTICED THERE'S A COMBINATION.

I DON'T HAVE THAT COMBINATION.

ANYWAY, IT'S GREAT TO MEET YOU.

HUH? DON MILLS RETIRED US GEOLOGICAL SURVEY AS A HYDROLOGIST AFTER 42 PLUS YEARS WORKING FOR THE USGS.

STILL CONSIDERED AN EMERITUS SCIENTIST WITH THE USGS.

UM, MOST OF MY CAREER WAS SPENT DOING BASIC DATA COLLECTION AS WELL AS STUDIES ON SURFACE WATER, SURFACE WATER, GROUNDWATER RELATIONSHIPS, AND TOWARD THE END OF MY CAREER, FOCUSING ON LARGE REGIONAL GROUNDWATER FLOW SYSTEMS THROUGHOUT NORTHERN AND CENTRAL ARIZONA, AND ALSO WORKING WITH NATIVE AMERICAN TRIBES THROUGHOUT THE REGION TO HELP THEM BETTER UNDERSTAND AND DEVELOP THEIR WATER RESOURCES.

UM, SINCE RETIREMENT, I'VE BEEN MOSTLY FOCUSED ON DOING A LOT OF NONPROFIT WORK FOR WATER, WATER NONPROFITS IN ARIZONA AND CALIFORNIA.

SO. THANK YOU.

DON. DO WE HAVE CHAIRMAN RIGGLEMAN ONLINE? NO, HE WAS GOING TO TRY TO JOIN, BUT, YOU KNOW, IS HE GOING TO JOIN? OKAY, OKAY. HE DOESN'T SOUND LIKE HE MADE IT ON WITH THAT.

JUST AS AS CITY STAFF WANT TO CONVEY HOW IMPORTANT IT IS TO HAVE BOTH GROUPS IN THE ROOM.

IN THE PAST, WITH THE RATE STUDY, WE GO FROM A COMMISSION MEETING TO COUNCIL BACK TO COMMISSION TO COUNCIL.

AND THERE'S SUCH, I THINK, A BENEFIT FOR THESE LARGER DIRECTION TYPE TOPICS FOR EVERYONE TO BE IN THE SAME ROOM, HEARING THE SAME DISCUSSION AND HOPEFULLY LANDING ON KIND OF THE SAME CONCLUSION.

SO WE REALLY VALUABLE VALUE THIS OPPORTUNITY TODAY.

UM, WITH THAT, ANY LOGISTICAL THINGS I HAVEN'T COVERED? I JUST LIKE TO THANK THE WATER COMMISSION FOR MAKING THE TIME TO DO THIS AND COUNCIL AS WELL.

AND STAFF ALWAYS.

THANK YOU. UM, THE FIRST THING TO TO TOUCH ON AGAIN IS THE DISCUSSION ITEM AND DIRECTION WE'RE HOPING FOR TODAY IS DIRECTION ON THE LEVEL OF FINANCING FOR THE WATER, WASTEWATER AND RECLAIMED WATER FUND.

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I JUST WANTED TO SHOW OUR A WATER BILL.

IF I CAN PULL THIS UP IN WHAT WHAT FEES ARE WE TALKING ABOUT ON ON THE WATER BILL.

JUST SO WE'RE ALL WE ALL KNOW.

UM, THE BASE METERS ARE.

SO THIS IS A TYPICAL RESIDENTIAL BILL.

THE BASE METER CHARGE, THE TIER.

SO WHAT TIER? THE RESIDENTIAL. THE USAGE CHARGE, HOW MANY GALLONS YOU USE IN A MONTH, AND THEN THE SEWER CHARGE.

THE ENERGY SURCHARGE IS RELATED TO THE COSTS OF OF WATER PRODUCTION, WHETHER IT'S PRIMARILY UPPER LAKE MARY WATER OR IF IT'S PRIMARILY GROUNDWATER.

THE ENERGY CHARGE CHANGES SO MUCH EACH YEAR THAT EACH EACH YEAR, RICK CHARGES A RATE FOR THAT BASED ON HOW THE ENERGY CHARGES PREVIOUS YEAR, IF THAT MAKES SENSE.

SO IT'S RELATED, BUT IT'S NOT A RATE WE'RE DISCUSSING DURING THE RATE STUDY.

SO JUST WANTED TO MAKE SURE WE ALL UNDERSTAND THAT.

UM, AND WITH THAT I THINK WE'RE READY TO LAUNCH INTO YOUR PRESENTATION.

CAROL. I'LL BRING THAT UP AND I'M GOING TO PASS OUT ONE MORE HANDOUT WHILE CAROL IS TALKING.

I DIDN'T STAPLE IT, SO I COULDN'T EASILY FUNNEL IT AROUND.

UM, PULL UP YOUR TALK WHILE YOU'RE DOING THAT.

GOOD AFTERNOON, MAYOR AND MEMBERS OF COUNCIL AND COMMISSIONERS.

IT'S GREAT TO BE HERE IN PERSON TO SEE YOU ALL AND TALK TO YOU, BECAUSE I KNOW IN THE PAST I'VE BEEN VIRTUAL, AND WE ALSO HAVE ONLINE TO OTHER MEMBERS OF STANTEC THAT ARE CRITICAL TO THIS, THIS STUDY, WE HAVE ANDY BURNHAM, WHO'S OUR DIRECTOR OF MANAGEMENT AND TECHNOLOGY CONSULTING AT STANTEC.

WE ALSO HAVE TIM HANCOCK.

HE'S THE COMMUNICATIONS SPECIALIST.

SO, YOU KNOW, YOU'VE HEARD FROM BOTH OF THEM.

THEY'RE STILL HERE. THEY'LL STILL SPEAK UP.

THERE THEY ARE. THANKS.

SO ALL OF YOU HAVE SEEN VERSIONS OF THIS PRESENTATION THAT WE'RE GOING TO TALK ABOUT, BUT WE'RE HONING IN ON THESE FINANCIAL PLANNING SCENARIOS.

WE HAVE A FEW THINGS TO COVER PRIOR TO DIGGING INTO THE DETAILS.

WHAT WE'D LIKE TO DO IS GO OVER EACH OF THESE FUNDS THE WATER FUND, WASTEWATER FUND AND RECLAIMED WATER FUND OVER THE DETAILS, AND THEN COME BACK AND REALLY DIG INTO WHAT WE WOULD ARE ASKING FROM YOU.

SO WE'D LIKE TO START JUST JUST AT A HIGHER LEVEL.

AND AARON, IF WE COULD GO TO THE COMMUNICATIONS, WE WANTED TO START WITH TIM HANCOCK'S DISCUSSION ON COMMUNICATIONS, BECAUSE THIS IS CRITICAL TO WHAT YOUR CUSTOMERS WILL SEE AS A RESULT. THANK YOU KAREN.

GOOD AFTERNOON.

I'M TIM HANCOCK, STANTEC LEAD ENGAGEMENT AND OUTREACH CONSULTANT FOR THIS PROJECT.

WE'VE DISCUSSED VARIOUS ELEMENTS AND DIFFERENT CAPACITIES WITH YOU IN THE PAST.

AND SO LET ME JUST SHARE YOU REALLY WITH A QUICK REFRESHER OF HOW THESE ELEMENTS ARE GOING TO COME TO BEAR AND WHERE THINGS ARE RIGHT NOW AND MORE IMPORTANTLY, WHERE ARE WE GOING IN THE NEXT WEEKS AND MONTHS.

SO AS WE DISCUSSED, THERE ARE REALLY THREE GOALS FOR THE COMMUNICATIONS AND OUTREACH PROGRAM.

NUMBER ONE, EDUCATE AND INFORM STAKEHOLDERS.

THAT'S PROBABLY THE BIGGEST THING WE CAN HELP YOU WITH IS MAKING SURE FOLKS AT LEAST HAVE CORRECT INFORMATION OUT THERE.

SECONDLY, MAKE SURE THAT THEY HAVE THE ABILITY TO PROVIDE INPUT.

AND WE'RE GOING TO HAVE SEVERAL WAYS IN WHICH TO DO THAT.

I'M GOING TO GO BACK, CAROL ONE PLEASE.

AND LASTLY, WE'LL BE USING A VARIETY OF TOOLS TO MAKE SURE WE HAVE EQUITABLE OPPORTUNITY ACROSS THE COMMUNITY.

SO EVERYTHING YOU'RE DOING IN THE RATE STUDY IS FOCUSED ON KEEPING IT CLEAN.

OKAY. IT'S REALLY CLEAR THIS IS WATER, WASTEWATER, RECLAIMED WATER, YOU KNOW, KEEPING IT CLEAN.

AND WHAT GOES INTO THAT IS FULFILLING ALL OF YOUR REGULATORY REQUIREMENTS.

MAINTAINING QUALITY AND RELIABLE SERVICE.

HAVING HIGH QUALITY WATER.

WATER RECLAMATION CONTINUES TO BE A GROWING FOCUS IN THE COMMUNITY.

OF COURSE, EFFICIENCY AND OPERATION REMAINS KEY.

THOSE ARE ALL REALLY THE MESSAGES THAT WE'RE GOING TO REINFORCE THROUGH THE OUTREACH PROGRAM.

GOING INTO THE NEXT SLIDE.

YOU KNOW, WE'RE GOING TO ENGAGE A LOT OF DIFFERENT PLATFORMS IN ORDER TO DO THIS.

AGAIN, WE'RE GOING TO INFORM, BUT WE'RE ALSO GOING TO RECEIVE INPUT.

SO THOSE PLATFORMS ARE GOING TO CONSIST OF THINGS SUCH AS VIRTUAL INFORMATION MEETINGS.

THESE CAN HAVE A VERY BROAD REACH AND FLAGSTAFF BECAUSE OF YOUR HIGH DEGREE OF BROADBAND SATURATION RATE.

WE DO RECOGNIZE THAT THERE ARE GOING TO BE POCKETS OF THE COMMUNITY.

WE'RE GOING TO NEED TO TAILOR SOME OF OUR OUTREACH PROGRAM TO IN-PERSON MEETINGS WILL OCCUR AS WELL.

THINGS SUCH AS DROP IN STYLE MEETINGS WHERE PEOPLE CAN HAVE A TWO HOUR WINDOW, FOR EXAMPLE, TO COME IN, LEARN AND ASK SOME QUESTIONS.

WE'RE ALSO WORKING WITH A VENDOR TO PROVIDE TEXT ALERTS AND PHONE IN OPTIONS TO BROADEN THAT, MEETING PARTICIPATION ACROSS ANY AND ALL DEMOGRAPHICS THROUGHOUT THE COMMUNITY. AND LASTLY, WE'RE GOING TO DEVELOP MATERIALS AVAILABLE FOR SPANISH SPEAKING STAKEHOLDERS AS WELL.

SO IF YOU GO TO THE WEBSITE, YOU'LL BE ABLE TO TO CLICK ON DOCUMENTS AND RECEIVE THE SPANISH TRANSLATION VERSIONS AS WELL.

THOSE ARE NOT READY AND UP YET.

WE'RE WORKING ON THEM.

[00:15:01]

AND ONE OF THE THINGS I WANT TO SHARE WITH YOU ON THE OUTREACH, BEFORE YOU GET INTO THE MEAT AND POTATOES OF YOUR MEETING THIS AFTERNOON, IS UNVEILED TO THE CITY COUNCIL AT THEIR LAST WORKSHOP.

A KEY FEATURE OF THIS OUTREACH PROGRAM REALLY IS THE PROJECT WEBSITE.

THE WEBSITE IS LIVE.

IT'S UP AND RUNNING W-W-W DOT CLEAN WATER FLAGSTAFF.COM.

AND LIKE I SAID, IT'S OPERATIONAL AND THE SITE IS INTENDED TO BE A RESOURCE OF INFORMATION FOR RESIDENTS AND BUSINESSES.

TO COMMUNICATE IN A TWO WAY MEANS IT'S NOT JUST TO GO TO THE WEBSITE AND GET INFORMATION TO LEARN ABOUT UPCOMING MEETINGS.

THOSE ARE ALL VALUABLE TOOLS.

BUT ALSO, IF YOU HAVE A QUESTION OR CONCERN, YOU CAN CLICK ON THE CONTACT US BUTTON.

REACH OUT AND THAT WILL GO TO ONE OF A COUPLE STAFF MEMBERS WHO THEN WILL FOLLOW UP WITH THOSE INDIVIDUALS.

SO AS WE DEVELOP MEETINGS AND DATES UPCOMING, THEY'LL BE UPLOADED AND POSTED TO THE WEBSITE.

AND THE ROLE OF THE OUTREACH REALLY IS TO TAKE THE INFORMATION THAT YOU ARE PRESENTED WITH AND SHARE IT WITH THE COMMUNITY AND WHAT I CALL AN EASILY DIGESTIBLE FORMAT.

SO WE'RE GOING TO BE WORKING ON THAT EDUCATION.

WE'RE GOING TO BE WORKING ON NORMALIZING A LOT OF OUR LANGUAGES.

BUT, YOU KNOW, ONE OF THE KEY QUESTIONS YOU PROBABLY HAVE IS REALLY WHAT IS THAT MESSAGE GOING TO BE? AND QUITE HONESTLY, THIS IS WHERE WE TAKE OUR CUE FROM YOU.

AS WE GO THROUGH THE STUDY, WE PRESENT YOU WITH OPTIONS AND YOU BEGIN SHAPING THOSE OPTIONS, GIVING DIRECTION TO STAFF ON HOW TO MOVE FORWARD.

EVEN IF YOU'RE IDENTIFYING AND SAYING, LOOK, HERE ARE THE GOAL POSTS, HERE'S YOUR RANGE WE'RE TRYING TO LAND IN.

WHATEVER THE CASE MAY BE, WE WILL TAKE OUR LEAD FROM YOU, AND THEN WE WILL BUILD THE INFORMATION STORY AROUND THAT LEAD.

SO AGAIN, PLEASE SEE WHAT WE'RE DOING AND WORKING VERY CLOSELY WITH YOUR COMMUNICATION STAFF AS A TOOL TO GO OUT THERE AND INCREASE THE LEVEL OF EDUCATION AND UNDERSTANDING IN THE COMMUNITY. AND WE'VE DEVELOPED A NUMBER OF TOOLS TO DO THAT.

BUT AS I MENTIONED, YOU KNOW, YOU'VE GOT A LOT TO COVER TONIGHT.

SO I WANT TO KEEP THIS SECTION PRETTY BRIEF.

I DO HAVE A MEETING THAT I'M GOING TO HAVE TO STEP OUT TO IN THE NOT TOO DISTANT FUTURE HERE, BUT IF YOU DO HAVE ANY QUESTIONS REGARDING COMMUNICATIONS, PLEASE, YOU KNOW, CONVEY THEM TO AARON AND WHATEVER.

SHE CANNOT ANSWER BASED ON WHAT WE'VE DISCUSSED OR DECIDED ALREADY.

SHE WILL TAKE NOTE OF THOSE AND GET BACK TO ME, AND WE'LL WORK WITH THE COMMUNICATIONS STAFF TO ADDRESS ANY QUESTIONS YOU MAY HAVE.

BUT THAT'S THAT'S THE READER'S DIGEST VERSION OF WHERE WE'RE GOING WITH THE OUTREACH PROGRAM.

AND I'LL TURN IT BACK OVER TO CAROL.

THANKS, TIM. THANKS, AARON.

ALL RIGHTY.

IF YOU RECALL, WHEN WE FIRST SPOKE A FEW MONTHS AGO, WE TALKED ABOUT THE OVERARCHING STRATEGIES THAT ARE DRIVING THIS RATE STUDY.

THESE WERE SOME COMMENTS AND ADVISORY STRATEGIES THAT CAME OUT OF THE LAST RATE STUDY FROM MEMBERS OF COUNCIL AND THE COMMISSION.

SO JUST WANTED TO POINT OUT THAT WE'RE STILL KEEPING THESE IN MIND, AND THEY'RE STILL DRIVING WHAT WE'RE DOING.

AND IN PARTICULAR STRATEGY STRATEGY TWO IS DEVELOPING A LONG RANGE FINANCING PLAN THAT SETS FORTH THE LONG TERM FUNDING NEEDS OF WATER SERVICES.

SO I WANTED TO JUST KIND OF REMIND EVERYBODY OF OUR LONG TERM GOAL HERE IS TO MAKE SURE THAT WHAT WE END UP HERE ARE RATES THAT FUND A SUSTAINABLE PLAN THAT HELPS YOU DELIVER YOUR QUALITY OF SERVICES AND COMPLETES YOUR REPAIRS AND REPLACEMENTS AND ALL THOSE NEEDED IMPROVEMENTS THAT YOU HAVE SO THAT YOU'RE WORKING TOGETHER YEAR OVER YEAR TO BE ABLE TO DELIVER GOOD SERVICE TO YOUR COMMUNITY.

SO THAT'S REALLY OUR ULTIMATE GOAL.

BUT OUR IMMEDIATE GOAL OF TODAY IS TO GET YOUR FEEDBACK AND DIRECTION ON THESE, THESE ALTERNATIVES.

SO I'D LIKE TO TALK ABOUT THOSE ALTERNATIVES.

AND THESE AGAIN ARE THINGS YOU'VE SEEN BEFORE WITH THE ADDITION OF THAT LAST SCENARIO.

WE HAVE FOUR RATE PLANS OR FOUR RATE SCENARIOS.

THE FIRST RATE SCENARIO IS CALLED THE CONSUMER PRICE INDEX OR CPI.

AND THIS IS THE THE SCENARIO WHERE WE'RE JUST INCREASING RATES OR INCREASING THE RATE REVENUES EACH YEAR BY 5% OVER THE FULL PERIOD FOR THE FIVE YEAR RATE PERIOD, PLUS SOME.

SO THAT 5% REPRESENTS THE YEAR OVER YEAR CHANGE IN INFLATION IN THE CONSUMER PRICE INDEX OVER THIS LAST YEAR.

SO WE WOULD HAVE THOSE 5% RATE ADJUSTMENTS TO FUND TARGET RESERVE BALANCES, OPERATIONS AND MAINTENANCE EXPENSES, AND A LEVEL OF CAPITAL PROJECTS. THE SECOND SCENARIO IS THE SMOOTH CATCH UP.

WE UNDERSTAND THAT YOU HAVEN'T HAD A RATE ADJUSTMENT IN WATER WASTEWATER RECLAIM SINCE 2020.

SO IN ORDER TO CATCH UP WITH WHAT HAS HAPPENED IN THE PRICE CHANGES OVER TIME FROM 2020 THROUGH 2025, WHICH WOULD BE THE FIRST YEAR OF THE RATE ADJUSTMENT, WE'RE LOOKING AT AN INCREASE IN PROJECT COSTS, SO THEREFORE AN INCREASE IN RATES TO CATCH UP.

BUT INSTEAD OF DOING IT ALL AT ONCE, WE'RE PROPOSING TO SMOOTH THAT OUT AT 8.5% YEAR FOR FIVE YEARS AND THEN 5% THEREAFTER.

SO THAT'S SCENARIO TWO.

SCENARIO THREE IS THE FULL PROJECT FUNDING SCENARIO.

FULL FUNDING SCENARIO.

THESE ARE THE RATE ADJUSTMENTS THAT WOULD BE NEEDED TO GENERATE SUFFICIENT REVENUES TO MEET YOUR OPERATIONS AND MAINTENANCE NEEDS.

[00:20:06]

AND THEN ALSO YOUR RESERVE FUND BALANCES AND DEBT SERVICE COVERAGE REQUIREMENTS.

SO THAT IS SCENARIO THREE.

WHEN WE WERE HERE TALKING WITH YOU TWO WEEKS AGO, WE DISCUSSED AN ALTERNATIVE OPTION WHERE YOU WOULD FUND THE FULL CIP SCENARIO, BUT AT A MORE LEVELIZED RATE OF RATE ADJUSTMENTS.

SO THAT'S THE SCENARIO THAT YOU HAVEN'T SEEN YET.

AND WE'RE GOING TO BE TALKING ABOUT IT TODAY.

ANY QUESTIONS BEFORE I MOVE FORWARD.

OKAY, HERE WE GO. THE TABLE AT THE TOP SHOWS THE THREE DIFFERENT FUNDS.

BUT WHAT'S IMPORTANT ABOUT THIS TABLE IS THAT IT SHOWS YOU THE LEVEL OF CAPITAL IMPROVEMENTS THAT ARE CONSIDERED UNDER THREE DIFFERENT LEVELS OF THE CIP.

THE APPROVED CIP IS THAT THAT REFLECTS WHAT'S IN YOUR CURRENT APPROVED BALANCED FINANCIAL PLAN.

SO THAT IS A PARTIAL LIST OF ALL THE PROJECTS NEEDED.

BUT IT IS A LIST THAT HAS BEEN THAT YOU'VE APPROVED AND THAT'S IN THAT FIRST COLUMN.

THE SECOND COLUMN ADDS IN ADDITIONAL PROJECTS FROM YOUR MASTER PLANNING PROCESS.

THAT'S CALLED THE INFORMED.

SO WE'RE ADDING IN ADDITIONAL PROJECTS THAT HAVE BEEN ON YOUR ON YOUR PLAN FOR A WHILE BUT HAVEN'T BEEN FUNDED PREVIOUSLY.

AND THEN THAT LAST COLUMN ADDS IN ANOTHER SET OF PROJECTS THAT HAVE BEEN ON AN UNFUNDED LIST.

SO THESE ARE PROJECTS THAT HAVE JUST KIND OF BEEN ON THE RADAR FOR A REALLY LONG TIME THAT ARE NEEDED, BUT HAVEN'T HAD A FUNDING SOURCE IDENTIFIED.

SO WE HAVE THREE LEVELS OF THESE PROJECTS.

YES. YOU'RE GOING TO GO THERE.

YES. SO AARON AND LISA HANDED OUT SOME SEVERAL STACKS OF PAPERS AND YOU'VE ALL READ THEM RIGHT.

I'LL DIGEST THE FIRST SET OF THREE PAGES REPRESENTS THOSE THREE LEVELS OF CIP.

SO THE FIRST SET FOR WATER, WASTEWATER AND RECLAIM.

SO ON EACH PAGE, THE FIRST SET IS THAT APPROVED CIP.

AND IT'S LABELED AS SUCH.

NOW THIS ONE IS QUITE COLORFUL BECAUSE WHAT WE'VE TRIED TO DO IS HIGHLIGHT WHICH PROJECTS CAME FROM WHICH DOCUMENT.

SO FOR EXAMPLE, THE YELLOW PROJECTS ARE FROM THE MASTER PLANS.

SO YOU HAVE I THINK AARON HAS PROVIDED IN THE PAST REFERENCES TO THE MASTER PLAN.

AARON, WERE YOU PLANNING ON PROVIDING THE MASTER PLANS AS WELL OR IS THAT BY REFERENCE? I'LL PROVIDE A LINK TO THE SEWER WATER MASTER PLAN AND THE WATER INFRASTRUCTURE MASTER PLAN FROM 2014 AND 2015.

THE MASTER PLANNING PROCESS WAS DEVELOPED BY ENGINEERS ASSESSING OUR WATER SYSTEMS FOR OUR NEEDS, AND THE MASTER PLANS WALK THROUGH THAT PROCESS REALLY, REALLY WELL.

ON WHY THESE PROJECTS ARE PRIORITIZED, AND THEY'RE ALL VERY IMPORTANT PROJECTS AS OUTCOMES OF THOSE MASTER PLANS THAT WE'RE STILL WORKING ON.

SO IT'S HARD FOR US TO TAKE THAT INFORMATION AND PUT IT IN THIS FORMAT.

THE CRITICALITY OF ALL THOSE PROJECTS, IF THAT MAKES SENSE.

BUT THESE ARE THE HIGHEST PRIORITY PROJECTS.

YES, YES.

JUST TWO QUESTIONS. JUST SO I CAN GET MY HEAD WRAPPED AROUND SOME OF THIS.

THE RED GAP RANCH, A LOT OF IT WAS OUT OF A BOND FUND IN 2005.

YES. YES.

SO THE VOTERS PASSED AN ELECTION FOR TO PURCHASE RED GAP AND TO SECURE WATER RIGHTS.

AND THEN WE BUILT IN THE CIP ITEMS NECESSARY TO SECURE THE PIPELINE ALIGNMENT, BASICALLY.

SO THE BOND IN 2005 WASN'T FOR THESE LINE ITEMS. IT WAS JUST TO PURCHASE THE LAND.

AND THERE WAS SOME MONEY LEFT OVER FROM THE BOND DOLLARS APPROVED THAT I FELT FUNDED SOME OF THIS WORK.

I HAVE TO GO BACK TO WORK. I WAS JUST CURIOUS ON WHY THEY WERE, IF IT WAS BOND FUNDED, WHY IT WAS LISTED AS A PROJECT WE WERE NEEDING TO FUND.

SO IT SOUNDS LIKE IT WAS JUST FOR THE PURCHASE OF THE.

I THOUGHT IT WAS FOR $15 MILLION AND WE PURCHASED FOR 11 SOMETHING, AND THEN THE REMAINDER FED SOME OF THE PLANNING WORK THAT WAS NECESSARY.

THAT, AND IT'S IMPORTANT TO NOTE THAT RED GAP IN THE LIST.

IT TOTALS ABOUT $3 MILLION OVER A TEN YEAR PERIOD OF OF THE 100 MILLION PLUS THAT'S IN THERE.

SO THEN MY SECOND QUESTION.

SO WE HAD A MASTER PLAN DONE IN 2000.

[00:25:02]

2014. SO NINE YEARS AGO.

AND SO NOW WE'RE TALKING ABOUT FUNDING WHAT WE IDENTIFIED IN 2014.

A LOT OF THE PROJECTS, THE YELLOW PROJECTS ON HERE WERE IDENTIFIED IN THAT MASTER PLAN.

RED GAP I HAVE HIGHLIGHTED IN BLUE, AS YOU KNOW, THAT'S AN OUTCOME OF SECURING THE WATER RIGHTS FOR THE CITY, WHICH WAS THAT BOND TOPIC. AND WHAT'S INTERESTING ON WATER, FOR EXAMPLE, IS THE UNFUNDED PROJECTS THAT ARE LARGELY YELLOW IN COLOR.

THOSE WERE IDENTIFIED ON THAT 2014.

SO WE'VE DEFERRED A LOT OF PROJECTS TO THE UNFUNDED LIST TO FUND THINGS LIKE HIGHLIGHTED IN GREEN, FOR EXAMPLE, PROJECTS TRIGGERED BY DEVELOPMENT OR OTHER INITIATIVES.

SO SOME OF OUR WATER LINE REPLACEMENT PROJECTS MIGHT NOT BE OUR PRIORITY PROJECT, BUT IT'S A PRIORITY BECAUSE WE DON'T WANT TO DIG TWICE IN AN AREA.

IF THAT DIG ONE TYPE POLICY THAT BROUGHT IT TO THE FOREFRONT.

I'M JUST TRYING TO GET MY HEAD WRAPPED AROUND.

I MEAN, WE JUST WENT THROUGH THIS WITH STORMWATER, AND NOW WE'VE GOT ALL THESE, YOU KNOW, TEN, 20 YEAR PROJECTS THAT HAVE BEEN PENDING AND CRITICAL.

YEAH. SO. OKAY.

ALL RIGHT. THAT'S ENOUGH RIGHT NOW.

SORRY. AND AM PREPARED WITH SOME OTHER SLIDES.

IF WE NEED TO HELP WALK THROUGH THIS IN MORE DETAIL AS WE WRAP AROUND TO DISCUSSION.

BUT HOPEFULLY WE'RE PROVIDING MATERIALS THAT WILL HELP YOU FRAME WHERE WE'RE AT IN THE SECOND HANDOUT THAT IS ACTUALLY TABLE THAT TAKES THE PROJECTS ON THAT LIST, BUT ORGANIZES THEM BY PROJECT TYPE.

SO MAINTENANCE PROJECTS, RESILIENCY PROJECTS, NEAR TERM GROWTH AND LONG TERM GROWTH. AND THAT IDENTIFIES IF THAT PROJECT IS IN OUR CURRENT APPROVED CIP IS AN INFORMED CIP WHICH IS UNFUNDED OR ON THE UNFUNDED LIST.

SO LISA WORKED HARD TO PREPARE THIS TO HELP YOU.

WHAT TYPES OF PROJECTS ARE WE LOOKING AT? SO THERE WERE ALSO SOME QUESTIONS THAT IT LOOKED LIKE THERE WERE DUPLICATIONS BETWEEN THE UNFUNDED AND THE INFORMED CIP.

SO THAT CHART SHOWS YOU WHY IT WAS LISTED IN MORE THAN ONE PLACE.

SOME OF IT MIGHT HAVE BEEN DESIGN COSTS, BUT NOT CONSTRUCTION OR OR WHATEVER WAS FUNDED AT THE TIME WAS NOT DID NOT FULLY FUND WHAT THE CURRENT NEED IS.

AND SO THAT'S WHY IT WOULD BE IN THE FORM.

SO YOU'LL SEE THOSE MULTIPLE X'S ACROSS THOSE, THOSE FIELDS THAT THAT'LL INDICATE WHY IT MAY LOOK LIKE IT WAS A DUPLICATE EFFORT.

WHY WE DUPLICATE THE MAJOR.

THANK YOU. DID SHE ON THE FLIP SIDE OF EACH ONE OF THESE CHARTS OR SMALLER TABLES THAT FURTHER DEFINE THE TYPES OF PROJECTS ON THE WATER SIDE? THE MAJOR PROJECT LIST OF RED GAP BRANCH PIPELINE DESIGN AND CONSTRUCTION.

THIS IS NOT INCLUDED IN OUR ANALYSIS, SO WE HAVE NOT INCLUDED THIS IN ANY OF THESE SCENARIOS.

THE UNFUNDED PROJECTS WE HAVE, AND WE'VE REPRESENTED THEM BY AN AVERAGE AMOUNT EACH YEAR.

THE GRANT FUNDED PROJECTS ARE IMPORTANT BECAUSE WE'RE GOING TO BE TALKING ABOUT FUNDING SOURCES.

SO WHILE WE'RE FOCUSED ON RATE FUNDING, WE HAVE MADE A BALANCE BETWEEN AND AMONG RATE FUNDING PROJECTS, CAPACITY FOR FUNDING PROJECTS.

SO GROWTH RELATED PROJECTS BEING FUNDED WITH GROWTH RELATED REVENUES AND GRANTS.

SO THE GRANTS COMPONENT FOR EACH FUND IS LISTED HERE.

ON THE WASTEWATER SIDE WE HAVE THE SAME.

THAT'S THE SECOND PAGE.

IT'S THE SAME PROCESS. THAT TOP PART OF THE TABLE IS THE APPROVED CIP.

THE SECOND PART INCLUDES INFORMED PROJECT COSTS AS WELL AS THE ANNUAL AND FUNDED AMOUNT.

ON THE FLIP SIDE IS SHOWN THE WILDCAT EXPANSION, DESIGN AND CONSTRUCTION WE DO HAVE IN OUR MODELING, WE'VE INCLUDED THE THE TREATMENT PLAN, EXPANSION AND CONSTRUCTION, OR THE DESIGN AND CONSTRUCTION AS A TOGGLE JUST TO SEE WHAT IMPACT IT WOULD HAVE ON RATES.

HOWEVER, THAT FUNDING SOURCE IS NOT IDENTIFIED AS YET, SO THAT WOULD BE A TOPIC OF CONVERSATION.

SO WE HAVE CONSIDERED IT.

IT'S JUST NOT GOING TO BE IN THE SCENARIOS THAT WE'LL LOOK AT RIGHT.

TONIGHT. I'M THEN UNRECLAIMED IT'S A SIMILAR STORY.

YOU'VE HEARD ME SAY THIS ALREADY, BUT WE HAVE THE APPROVED THE INFORMED PLUS UNFUNDED.

[00:30:01]

THAT'S THE RECLAIMED RECHARGE OUTFALL PROJECT AND THEN THE LIST OF UNFUNDED PROJECTS.

AND THEN, AS ERIN MENTIONED, THAT STAPLED SET OF PROJECTS WILL SHOW YOU WHERE THESE PROJECTS APPEAR IN THE APPROVED, BUDGET INFORMED OR UNFUNDED CIP.

OKAY. READY TO.

YES. QUICK QUESTION. SO THE WE GOT THE 2015 MASTER PLAN FOR THE SUMMER 2014 FOR THE WATER.

ARE YOU STILL FEEL LIKE.

AND THEN YOU HAVE THE DEVELOPMENT WHATEVER PROJECTS YOU STILL FEEL LIKE THAT'S A VALID LIST, BUT THERE AREN'T.

OH YES. VERY VALID OKAY.

AND LIKE TO YOU, DO YOU WANT TO ADD ANYTHING? I THINK IT'S A GREAT QUESTION.

SO AGAIN THE INTENT IS EVERY FIVE YEARS RIGHT.

YOU'RE UPDATING YOUR MASTER PLANS.

SO THE PROJECTS ON THERE THAT HAVEN'T BEEN COMPLETED, WE DO MAKE THE ASSUMPTION THAT THAT'S GOING TO CARRY FORWARD AS WE UPDATE OUR MASTER PLAN.

ANY PROJECTS NOT COMPLETED ARE GOING TO BE RESTATED IN THE CURRENT WITH ANY ADDITIONAL.

SO WHY WE THINK IT'S RELEVANT, EVEN THOUGH WE ARE UPDATING OUR MASTER PLANS AND THAT CONTINUATION, WE'RE VERY CONFIDENT IN THE INFORMATION THAT WAS PROVIDED IN THE EARLIER MASTER PLANS. BUT THEN HOW DO YOU HANDLE EMERGENCY THINGS THAT COME UP YOU WEREN'T EXPECTING? SO YOU'RE AND SO THIS YEAR YOU HAVE YOUR LIST.

NEXT YEAR YOU KNOW YOU HAVE FEW LEFT FROM HERE.

THEY GO HERE TO THE NEXT YEAR.

BUT THEN THERE'S SOME KIND OF CRISIS OR EMERGENCY.

WHERE DOES THAT PROJECT GO? I'M ASSUMING IT GETS DONE RIGHT THEN BECAUSE OF THE NATURE THAT.

YES, RIGHT IT IS.

IT IS TRUE. SO AS THINGS, AS THINGS COME UP THAT WEREN'T ANTICIPATED THAT RISE UP ABOVE THE PRIORITY, YOU'RE RIGHT.

THINGS IN THE PLAN, IN THE CIP, THEY GET PUSHED EVERY DAY.

WE REPRIORITIZE, WE RETAKE PROJECTS.

AND WHEN I SAY ULTIMATELY, WHAT YOU GET IS THIS KIND OF THIS TIDAL WAVE IN YOUR TENURE WHERE I CAN'T AFFORD TO DO THAT THIS YEAR BECAUSE THIS IS MORE IMPORTANT AND I MOVE IT ONE YEAR. AND SO YOU KIND OF JUST DOUBLE STACK THAT NEXT YEAR.

AND SO THAT'S WHY IT'S IMPORTANT WHEN STANTEC LOOKS AT THE WORK THAT'S SMOOTHING.

THAT THEY KIND OF TALK ABOUT ON HOW YOU BRING THOSE OUT, BECAUSE EVERYTHING CAN JUST OCCUR THE NEXT YEAR, EVEN THOUGH AS YOU START TO BUILD OUT THOSE PLANS, THAT IS THE INTENT. IT CAN BE DONE. THIS YEAR STILL NEEDS DONE.

YOU MOVE IT ONE YEAR TO ACCOMMODATE YOUR BUDGET THAT YOU'RE WORKING IN, AND SO THAT THERE'S A SMOOTHING FACTOR THAT HAS TO OCCUR TO BRING THIS FORWARD.

OKAY. NOW THIS IS A LITTLE BIT HARDER OF A QUESTION.

WHO GETS TO DETERMINE WHAT'S A CRISIS AND WHAT'S THE EMERGENCY.

SO THINK WHAT HAPPENS IN MY NEIGHBORHOOD MAY NOT BE AN EMERGENCY TO ANYBODY ELSE.

SO WHO GETS TO MAKE THOSE DECISIONS.

ALL RIGHT. AGAIN THINK IT'S A GREAT QUESTION.

THINK MY RESPONSE WOULD BE IS I THINK WE GET TO MAKE THAT DECISION.

AND SO ULTIMATELY THE WAY THAT WOULD WORK IS I'D BRING FORTH A PROJECT.

IT WOULD BE A RECOMMENDATION FROM STAFF SAYING THIS NEEDS TO BE DONE, WHETHER IT'S A FORM OF A DESIGN, CONSTRUCTION OR RATIFICATION, BECAUSE DECISIONS WERE MADE.

WE BRING THAT BACK TO THE COUNCIL FOR THAT TYPE OF DISCUSSION, TO SAY, THIS IS WHY WE NEED TO DO THIS AND WHY IT'S IMPORTANT.

ULTIMATELY, GETTING COUNCIL TO APPROVE, WHETHER IT'S, AGAIN, A CONTRACT OR A REPRIORITIZATION OF WHY THIS HAS TO BE DONE OR WHY WE MADE A DECISION UNDER A TRUE EMERGENCY. TYPICALLY THE DECISIONS MADE, WE GET IT DONE AND WE COME BACK TO THE COUNCIL'S RATIFICATION SAYING THIS HAPPENED LAST WEEK AND THIS IS WHAT WE DID, AND LOOK FOR YOUR RATIFICATION TO APPROVE THAT.

AND IF I COULD ADD IN THE WATER INFRASTRUCTURE MASTER PLAN, FOR EXAMPLE, A LOT OF THE PRIORITIZATION IS BASED ON AGE.

AGE OF PIPE OR MATERIAL, PIPE MATERIAL TYPE OF PIPE, OR SO THAT OFTEN DRIVES THE PRIORITIZATION AS WELL. OH, YES.

SURE. HAVE A HAVE A QUESTION.

I REALLY WANTED TO ASK THIS DURING THE COMMISSION MEETING THE OTHER THE OTHER NIGHT, AND I'M KIND OF CURIOUS ABOUT WHETHER OR NOT THESE THE NUMBERS THAT WE SEE ON THESE TABLES RIGHT NOW HAVE BEEN ADJUSTED FOR CURRENT CURRENT COST CONDITIONS. FOR EXAMPLE, THE MOST OF THE YELLOW HIGHLIGHTS COME FROM A 2014 MASTER PLAN, AND THEN THE BLUE HIGHLIGHTS ARE ARE THINGS THAT CAME FROM THE 2004 BOND ELECTION. UM, CONSIDERING WHAT'S GONE ON OVER THE LAST COUPLE OF YEARS, YOU KNOW, PANDEMIC AND OTHER AND ALL OF THE ISSUES THAT THAT CAUSED WAS SUPPLY CHAIN, A LOT OF COST HAVE GONE UP.

[00:35:02]

BUT THE QUESTION I DIDN'T GET TO ASK IS HOW THOSE KIND OF INCREASE INCREASES ARE ARE NOT REFLECTED IN THE NUMBERS ON THESE TABLES. YEAH.

IF MY AND COMMISSIONER BILLS, IF YOU LOOK AT THE TABLE, THE FIRST PART THE DOLLARS WITHIN THIS TABLE ARE CURRENT DOLLARS.

THE COLUMN FOR FISCAL YEAR 2020 FOR THIS CURRENT YEAR.

THESE HAVE BEEN UPDATED FOR CURRENT COSTS OKAY.

AND THEN THERE'S ROW LIKE LINE ITEM 44 I KNOW THESE ARE TINY, BUT THE CUMULATIVE PROJECTED COST ESCALATION ROW THAT WOULD BE THE SECOND SUMMARY ROW BEFORE THE ORANGE LINE IN THE MIDDLE OF YOUR PAGE.

THAT IS THE ESCALATION ADJUSTMENT.

EXCUSE ME A 4% STARTING IN 2025.

SO WE HAVE APPLIED COST ESCALATION TO THESE DOLLARS.

SO THE THE LINE RIGHT HERE.

YEAH OKAY. THAT'S ENOUGH.

NO. WHAT DO YOU THINK YOU'RE GOING WE HAD A LONG DISCUSSION ON THAT.

AND WE WE LOOKED AT CHANGES IN THE SOMETHING CALLED, YOU KNOW THE THE ENGINEERING NEWS RECORD CONSTRUCTION COST INDEX.

SO WE LOOKED AT THOSE CHANGES.

WE TALKED ABOUT RECENT BIDS.

WE LOOKED AT RECENT COMMUNITIES IN ARIZONA AND WHAT THEY'RE ASSUMING FOR COST ESCALATIONS.

AND EVERYONE'S ASSUMING HIGHER ESCALATIONS IN THE NEAR TERM AND THEN LEVELING OFF OPTIMISTICALLY.

SO AGAIN IT'S ESTIMATES.

IT'S OUR BEST ESTIMATES TODAY.

THERE ARE SOME PROJECTS ON THIS LIST WHERE YOU'LL SEE THEY FALL ON MULTIPLE LINES.

THEY FALL UNDER APPROVED AND FORMED, AND MAYBE EVEN UNFUNDED AND COUNCIL MEMBER MATTHEWS I BELIEVE YOU ASKED THIS QUESTION DURING THE RETREAT.

WHY ARE THEY LISTED? ARE THEY DOUBLE COUNTED OR SOMETHING? IT'S JUST THAT THERE MIGHT STILL BE A PORTION OF THE PROJECT THAT ISN'T FUNDED BECAUSE FOR VARIOUS REASONS, AND WE MIGHT HAVE TO DEFER A PROJECT TO COVER THAT FUNDING IF THAT MAKES THAT MAKES SENSE.

BUT THAT'S WHY YOU MIGHT SEE IT LISTED UNDER MULTIPLE CATEGORIES.

SO JUST A REAL CLARIFICATION QUESTION.

I'M SORRY I'M BEING THICK MINDED TODAY, BUT THE APPROVED BUDGET ACTS.

THAT'S THAT'S NOT WE'VE ALREADY ALLOCATED TO PAY FOR THAT.

THAT IS APPROVED THAT WE'RE GOING TO WE NEED TO DO IT BECAUSE THAT'S NOT WE DON'T HAVE MONEY FOR THAT IN APPROVED BUDGET COLUMN.

CORRECT. WELL WE IT'S IN THE BALANCED BUDGET PRESENTED TO YOU FOR THIS CURRENT FISCAL YEAR.

OKAY. ASSUMING THE RATE INCREASE NOT.

THE AFTERNOON? NO, IT'S WITHIN THE FIVE YEAR PLANS THAT WE ADOPT ANNUALLY THROUGH THE BUDGET PROCESS THAT'S BASED ON EXISTING RATES.

OKAY. WHAT WE CAN AFFORD TO FUND IN THE CIP AND OPERATING ALL THAT OVER THE NEXT FIVE YEARS.

OKAY. SO ALL THE X'S IN APPROVED BUDGET IS ALREADY GOING TO BE PAID FOR BY THE CURRENT RATES THAT WE HAVE WATER RATES IN OUR FIVE YEAR BUDGET AT THE LEVELS THAT ARE UNINFLATED.

YES. YES OKAY.

OKAY. THAT IS A THAT'S A GOOD DISTINCTION IS THESE ARE AGAIN THE UNINFLATED VALUES THAT ARE IN THE BALANCE PLAN.

SO THAT WILL COME ACROSS THAT IN A MINUTE.

ANY OTHER QUESTIONS ON THOSE HANDOUTS.

JUST HAD ONE. THE BIGGEST AMOUNT ON HERE FOR THE COMING FISCAL YEAR IN 2024 IS 22 MILLION FOR THE BIOSOLIDS TREATMENT.

NOW, IS THAT COVERED UNDER THE RECENT BOND THAT WAS JUST PASSED.

AND I CAN TAKE THAT ONE.

THANK YOU. THAT ONE IS IS NOT.

SO WE ACTUALLY HAVE TWO PROJECTS GOING FOR THE SOLIDS.

HANDLING THE WILDCAT HILL DIGESTER IS A BOND PROJECT.

THE RIO IS IS NOT.

SO PORTION OF IT IS BEING FUNDED BY CAPACITY.

WHERE THE MONEY WE COLLECT FROM DEVELOPERS TO BUY IN IS PAYING FOR THAT AND THEN GOING FORWARD.

BUT YEAH, TWO DISTINCT PROJECTS DIGESTERS AT WILDCAT AND THE REAL SOLIDS HANDLING.

YEAH, I CAN JUST ADD THIS.

ONES THAT WERE APPROVED BY GENERAL OBLIGATION BONDS THAT HAVE A DIFFERENT FUNDING SOURCE.

SO THEY'RE NOT IN THE RATE IN THIS PLAN HERE.

THEY'RE A SEPARATE FUND TO JUST TO DELIVER THOSE PROJECTS.

HOW ARE THOSE BONDS BONDS PAID FOR.

THOSE ARE SECONDARY PROPERTY TAXES THAT WE LEVY ON AN ANNUAL BASIS TO PAY BACK THE DEBT.

IS THAT TRUE FOR ALL BONDS OR JUST CERTAIN TYPES OF BONDS? ONLY VOTER APPROVED GENERAL OBLIGATION DEBT IS ALLOWED TO USE SECONDARY PROPERTY TAX.

[00:40:01]

YOU COULD SWITCH TO THAT.

YEAH. YEAH, I CAN PULL THAT UP.

RICK'S TABLE.

YES. OKAY.

YOU'RE ON RICK. OKAY.

HOPE YOU USED A BIG FONT.

LET'S SEE HOW QUICKLY THIS PULLED UP.

I'M GLAD I'M SITTING HERE.

DIDN'T RECEIVE FOR THERE.

THAT COULD BE INTENTIONAL.

IF IT'S DOWN, LIKE, TO 6.6, I CAN'T SEE IT DOWN.

SO WE'VE HEARD FROM BOTH MEETINGS WE'VE HAD WITH WATER COMMISSION AND ALSO FOR CITY COUNCIL ABOUT, YOU KNOW, WHAT ARE THE OTHER RESOURCES AVAILABLE TO DELIVER SOME OF THESE PROJECTS. WE PUT IT ON A DIFFERENT RESOURCE.

OR HOW CAN WE FUND THESE, THIS AND SO FORTH.

AND SO I'M GOING TO JUST GO THROUGH SOME OF THE THE RESOURCES THAT WE KIND OF HAVE AVAILABLE IN A ENTERPRISE FUND.

WATER, WASTEWATER AND RECLAIMED WATER.

THE ONES WE'RE TALKING ABOUT AND KIND OF PUT A TABLE TOGETHER.

I DID THIS A COUPLE OF YEARS AGO WHEN WE WERE TALKING ABOUT INFRASTRUCTURE FUNDING RELATED TO WILDCAT AND THOSE PROJECTS.

AND SO THIS KIND OF TALKS YOU THROUGH THE RED, YELLOW, GREEN LIKE RED IS OR GREEN IS LIKE, YEAH, THESE ARE LIKELY RESOURCES AND MORE LIKELY TO BE ASSOCIATED WITH THESE TYPES OF FUNDS.

YELLOW GETS INTO THAT, YOU KNOW.

WELL THESE ARE SOME IDEAS.

WE CAN LOOK AT THESE, BUT THEY'RE NOT NECESSARILY THE RECOMMENDED APPROACH TO GO FOR FUNDING A ENTERPRISE FUNDS.

AND THE REDS ARE YEAH THEY'RE AVAILABLE.

BUT THERE MAY NOT BE UM CAPACITY OR WILL TO GO INTO THOSE RESOURCES FOR A WATER FUND, WASTEWATER FUND OR RECLAIMED WATER.

SO OF COURSE, STARTING AT THE TOP, THAT'S WHAT WE'RE TALKING ABOUT TODAY IS YOUR USER FEES.

WHAT RATES ARE WE GOING TO CHARGE FOR USAGE OF AND CONSUMPTION OF OUR PRODUCTS FOR EACH CUSTOMER CLASS THROUGHOUT OUR CITY? SO THAT'S REALLY THE MOST LIKELY RESOURCE FOR THESE FUNDS.

RIGHT. AND THAT'S WHY WE'RE HAVING THE CONVERSATION TODAY.

CAPACITY FEES ARE ALLOWED ALSO TO FUND THAT THOSE GROWTH PROJECTS.

BUT YOU CAN ONLY FUND THE GROWTH PORTION.

SO IF WE UPSIZE A LINE WE CAN ONLY PAY WITH CAPACITY FEES FROM THAT GROWTH PART OF THAT WATER LINE, SEWER LINE AND SO FORTH.

THE REST HAS TO BE RATE BASED OR DEBT FINANCE IN THAT CAPACITY.

SO YOU MAY SEE A PROJECT, BUT ONLY A PORTION OF IT IS GOING TO BE CAPACITY FEE RELATED.

UM, WE HAVE THOSE FOR WATER AND WASTEWATER, BUT RECLAIMED WATER DOESN'T HAVE CAPACITY FEES.

I'M NOT EVEN SURE IF STATE STATUTE ALLOWS US TO DO CAPACITY FEES, BUT WE'RE LOOKING AT THOSE FOR THIS STUDY ANYWAYS.

SO THAT'S WHY THAT'S A RED NO AT THIS TIME.

THE FINANCING IS A VERY POPULAR WAY TO DELIVER LARGE PROJECTS.

YOU ISSUE THE DEBT AND THEN THE DEBTS PAID OVER YEARS, AND MULTIPLE USERS IN THE FUTURE PAY INTO WHAT THE IMPROVEMENTS WERE.

SO THAT'S A COMMON WAY THAT WE WORK WITH OUR ENTERPRISE FUNDS.

BUT WE DO HAVE POLICY LIMITS.

WE CAN ONLY ISSUE SO MUCH DEBT AND HAVE SO MUCH DEBT AND DEBT SERVICE ON OUR BOOKS OVER A PERIOD OF TIME, BOTH FROM OUR WATER POLICIES AS WELL AS OUR DEBT FINANCES WE'VE ALREADY DONE.

WE'VE PROMISED THOSE PEOPLE WHO ARE BONDS TO ONLY GO TO A CERTAIN LEVEL IN DEBT FOR OUR WATER FUNDS.

SO THAT'S THERE.

BUT, YOU KNOW, YOU CAN ISSUE DEBT ALL DAY LONG, BUT YOU HAVE TO HAVE A RATE TO PAY IT BACK.

SO IT KIND OF GOES BACK TO THE TOP LINE, HAS TO PAY BACK DEBT SERVICE WHICH WAS REALLY GOOD.

THEY'VE GOT THEY GOT LOANS WHERE THEY WILL.

CAN'T THINK OF THE WORD RIGHT.

FORGIVE A PORTION OF YOUR LOANS.

WE'VE BEEN SUCCESSFUL THERE AND WE WILL LOOK FOR THEIR LOANS.

THEY'RE REALLY LOW INTEREST AND SOMETIMES THEY FORGIVE A PORTION OF PRINCIPAL.

SO THAT'S A REALLY VALUABLE RESOURCE THAT WE HAVE FOR THESE FUNDS.

NEXT IS OUR FEDERAL OR STATE FUNDING THAT CAN BE THROUGH INFRASTRUCTURE BILL, DIRECT APPROPRIATIONS GRANTS.

THAT'S THIS NEXT LINE.

YES. THEY'RE AVAILABLE.

THEY'RE COMPETITIVE THOUGH COMPETITIVE NATURE.

WE'RE COMPETING WITH OTHER ORGANIZATIONS THROUGHOUT THE COUNTRY TO DELIVER GRANTS.

WE DO HAVE SOME THAT WE HOPE ARE IDENTIFIED AS MOST LIKELY, BUT THEN THE FUTURE, AS WE GO OUT FURTHER, IT'S REALLY HARD TO DETERMINE WHAT WE'RE GOING TO GET IN FEDERAL FUNDING.

THEN AS FAR AS RECLAIMED WATER, I HAVEN'T SEEN MUCH ON THE RECLAIMED WATER SIDE FOR DEBT FINANCING, SO I KNOW WE GOT A BIG PROJECT THERE, SAID DEBT FINANCED, BUT FEDERAL STATE GRANT FUNDING.

[00:45:01]

I ASKED STACEY BRECHLER-KNAGGS AND SHE SAYS SHE HASN'T SEEN ANYTHING REALLY ON THE RECLAIMED WATER SIDE OF THINGS.

SO WE GOT THAT ONE KIND OF YELLOW.

WE COULD LOOK AT THAT MORE.

THEN WE GET INTO THE THE YELLOW IS LIKE, YEAH, THESE ARE OPTIONS.

THEY MAY NOT FIT WELL FOR US, BUT THESE ARE JUST WANT TO PUT OUT THERE TO YOU TO UNDERSTAND REPRIORITIZING OR ELIMINATING CAPITAL PROJECTS IN THE EXISTING IMPROVEMENT PLAN. SO IF WE CAN'T GET THE RATES WE NEED TO DELIVER THESE PROJECTS, WE'RE GOING TO FIGURE OUT SOMETHING ELSE.

WE'RE GOING TO HAVE TO SAY WHAT'S GOING TO BE LIMITED, WHAT'S GOING TO BE PUSHED OUT.

AND IT MAY HAVE A DETRIMENTAL IMPACT.

IT'LL DEFER MAINTENANCE, IT MAY INCREASE COSTS IN THE FUTURE.

SO THAT'S SOMETHING TO, YOU KNOW, JUGGLE WITH.

IS THAT REALLY A WAY WE WANT TO GO WHEN WE'RE SETTING OUR RATES GENERAL OBLIGATION BONDS.

THIS IS SOMETHING WE DID FOR WASTEWATER RECENTLY.

AND ALSO STORMWATER.

WE PASSED SOME WASTEWATER INFRASTRUCTURE IMPROVEMENTS THROUGH GENERAL OBLIGATION BONDS.

AND WE'RE DELIVERING THOSE IN A SEPARATE FUND.

SO THERE IS ABILITY TO DO THAT.

THERE IS CAPACITY THERE, MAYBE ABOUT 40 MILLION RIGHT NOW TO STAY WITHIN THE EXISTING RATE.

BUT THERE'S ALSO COMPETING NEEDS IN THE ORGANIZATION, NOT JUST WATER BUT MAYBE RECREATION.

IT'S AFFORDABLE HOUSING. ALL THESE OTHER THINGS HAVE COULD HAVE A NEED THAT MAY BE A GENERAL OBLIGATION OBLIGATION BOND CONSIDERATION.

SO IT'S IN THE YELLOW.

IT'S AVAILABLE.

WE CAN DO IT. BUT THERE ARE SOME PRIORITIES TO TALK ABOUT WHEN WE GET TO THOSE.

OF COURSE GENERAL FUND CAN SUPPORT JUST ABOUT EVERY FUND WITHIN THE ORGANIZATION.

THESE FUNDS ARE NO EXCEPTION.

WE PUT THESE RED THOUGH, BECAUSE GENERAL FUND IS PRETTY TIGHT ON THEIR BUDGET AND WHAT RESOURCES WE HAVE ALREADY IN THERE.

SO THAT'S KIND OF IN THE RED AREA.

WE'D HAVE TO PRIORITIZE.

WHAT ARE WE GOING TO REDUCE THE GENERAL FUND TO PAY FOR WATER AND WASTEWATER? IT'S AN OPTION, BUT UNLIKELY AT THIS POINT.

AND OF COURSE, THE SALES TAX WE CAN ISSUE A ASK THE VOTERS TO APPROVE A SALES TAX.

IF WE HAVE A MAJOR PROJECT WE WANT TO DELIVER AND WE WANT TO TAKE TO THE VOTERS AND ASK FOR A SPECIFIC SALES TAX TO PAY BACK OR BUILD A PROJECT, THAT'S AN OPTION.

WE HAVE THAT IN RED BECAUSE DON'T SEE THAT ANY OF THESE PROJECTS THAT ARE CURRENTLY WE'RE REALLY FOCUSING ON ARE THOSE THOSE LEVELS OF ASKING FOR A SALES TAX INCREASE VERSUS A PASSING ON TO USER FEES.

SO THAT'S KIND OF A BOARD OF KIND OF WHAT'S OUT THERE, WHAT'S AVAILABLE, WHAT WATER SERVICE FUNDS CAN DO.

AND I'LL ASK ANSWER ANY QUESTIONS.

OR YOU BETTER HOW OUR PRIORITIES SET FOR THAT $40 MILLION CAPACITY.

UM IT COMES IN MANY DIFFERENT WAYS.

SOMETIMES THINGS COME DIRECTLY TO STAFF OR THROUGH COMMISSIONS AS FAR AS WHAT THEY'D LIKE TO SEE ON BALLOTS.

AND THEN IT'S A CONVERSATION.

A LOT OF TIMES IT HAPPENS THROUGH THE BUDGET PROCESS.

AS WE START PLANNING AND LOOKING FORWARD TO ELECTIONS.

IT COMES IN A VARIETY OF WAYS.

I DON'T KNOW IF YOU'RE THE ONE THAT WILL ANSWER IT, BUT JUST LOOKING AT REPRIORITIZING OR ELIMINATING PROJECTS, I SEE A LOT OF THEM ON THIS LIST THAT I RECOGNIZE AS CRITICAL.

BUT HOW DO WE IS THERE A PRIORITY OF WHAT'S SUPER CRITICAL AND WHAT'S JUST A LUXURY WISH LIST? THERE ARE NO LUXURIES OR WISH LISTS ON HERE.

I'LL JUST SAY THAT.

SAY THAT WE'RE THAT.

GO AHEAD. DIRECTOR.

NO, I THINK IT'S A GREAT POINT. SO AGAIN, WHAT'S IN YOUR HANDOUTS? WE DID DO OUR BEST ATTEMPT ON THE STAPLED ONE TO PUT THE PROJECTS IN LIST OF WHAT WE DEEMED AS IF YOU COULD ONLY DO ONE THING AND KIND OF WORK THROUGH.

SO WE DO FEEL LIKE THIS IS ANOTHER PRIORITY.

AGAIN, I AGREE WITH AARON NOT MEANING THAT THE LAST THING ON THE LIST IS A LUXURY.

IT'S JUST WHERE FELL IN THE RATING.

I THINK I WOULD ALSO KIND OF POINT OUT, I THINK THAT'S A GREAT SLIDE THAT RICK DID AND AND EVEN KIND OF ALSO SHOWS KIND OF HOW WE, HOW WE CURRENTLY EXIST, RIGHT, THAT WE DO HAVE RATES THAT DO FUND SOME.

THERE ARE CAPACITY FEES THAT COME IN TO FUND SOME.

THERE'S LENDING.

SO WE'RE KIND OF TOUCHING ON ALL PORTIONS OF THOSE.

BUT REALLY WHAT WE'RE TALKING ABOUT IS I STILL FEEL LIKE THERE'S THIS, THIS GAP OF TIME RIGHT FROM ABOUT 2020 TO CURRENT OUT TO OUR FUNDING, WHERE THERE IS LIKE THIS CATCH UP THAT HAS TO OCCUR.

UM, BUT IN ADDITION, WHEN YOU TALK ABOUT REPRIORITIZING, I THINK THAT THESE OTHER HANDOUTS ALSO PAINT A GOOD PICTURE.

THEY'VE BEEN A GOOD PICTURE FOR ME.

UM, SO I WILL PICK ON MY FIRST ONE IS WATER.

THAT'S ON THERE.

AND, AND IF YOU LOOK AT REALLY THE, THE I'M SORRY THE THIRD LINE WHERE IT TALKS ABOUT AGING INFRASTRUCTURE.

[00:50:01]

BUT WHEN YOU LOOK AT WHAT WE'VE SPENT AND WHAT'S PROGRAMED TO BE SPENT OVER THE NEXT FEW YEARS IS $200,000.

I'LL TELL YOU, LIKE $200,000 DOESN'T BUY A LOT OF PIPE IN THE STREET.

BUT AS THESE OTHER THINGS HAVE COME UP, AS, WE'VE HAD TO FILL GAPS AND.

AND SO WE GO BACK TO PRIORITIZING.

I FEEL LIKE THOSE ARE THE ONES WHERE WE'VE MOVED THEM DOWN THE PRIORITIZATION LIST.

WE SAID WE'RE NOT GOING TO SPEND $1 MILLION THIS YEAR ON AGING INFRASTRUCTURE.

WE'RE GOING TO TAKE A PORTION OF THAT, AND WE'RE GOING TO COVER A GAP ON A PROJECT THAT CAME IN AT HIGHER BIDS THAN WE THOUGHT.

WE'RE GOING TO COVER A PROJECT THAT CAME UP THAT HAS TO BE DONE TODAY.

THERE'S NOT WE DON'T HAVE A CHOICE.

THIS IS BROKEN. IT'S GOT TO BE FIXED.

SO I THINK IT DOES KIND OF PAINT A PICTURE.

WHEN YOU LOOK AT THESE REOCCURRING, THESE MAINTENANCE ACTIVITIES, THIS KIND OF WHAT I WOULD SAY LIKE YOUR ASSET MANAGEMENT OF HAVING INFRASTRUCTURE AND HOW ARE YOU REPLACING THAT STUFF. WHEN YOU LOOK OVER THE LAST FEW YEARS AND EVEN IN THE NEXT FEW YEARS, THAT'S WHERE WE'VE TAKEN THE MONEY TO KIND OF FILL THE GAP, TO BALANCE THE BUDGET, TO GET THE THINGS DONE IS WE DID REPRIORITIZE.

UM, I WOULDN'T CALL IT A DEFERRAL, BECAUSE WHEN YOU DON'T DO THAT $800,000 OF INFRASTRUCTURE, YOU YOU DON'T EVER CATCH UP.

YOU'RE JUST YOU JUST DON'T COME BACK TO IT.

RIGHT. AND THE FURTHER WE PUSH OUT THAT $200,000 AND NOT THE MILLION, YOU JUST DIG A DEEPER HOLE.

THERE'S NO I DON'T THINK THERE'S A PUN THERE, BUT.

RIGHT. THAT THAT SO SOME OF IT IS LIKE, WELL WE'LL JUST WE'LL GET THAT NEXT YEAR.

RIGHT. BUT WE DON'T INCREASE IT BY THE 800,000 WE TAKE.

RIGHT. THE NEXT YEAR. WE DON'T DO 1.8.

RIGHT. WE'RE JUST STILL TRYING TO GET BACK TO THE 1 MILLION TO GET BACK TO WHERE WE SHOULD BE.

BUT SO HOPEFULLY THAT KIND OF ANSWERS THE QUESTION OF PRIORITIZING.

I FEEL LIKE YOU CAN SEE IT IN THOSE NUMBERS, AND THAT'S ONE THAT KIND OF STANDS OUT AND YOU SEE IT BOTH ON THE WATER AND WASTEWATER.

UM, YOU STOP DOING THOSE THINGS TO TAKE CARE OF THE URGENT AND THE EMERGENCY STUFF TODAY.

SO THAT'S WHY YOU HAVE THE INFORMED LINE FOR THAT.

THAT'S HOW WE HOW WE WHERE WE KNOW WE NEED TO FILL THAT GAP.

THANK YOU. MR.. GO AHEAD.

FOLLOW UP QUESTION JUST FOR PERSPECTIVE OR IN TWO PARTS WHEN.

SO YOU'VE BEEN DEFERRING OR AVOIDING RIGHT.

THAT'S NOT FREE IS IT.

WHAT'S WHAT'S THE COST THAT'S INCURRED TO THE COMMUNITY OVER TIME, AS YOU FAIL TO MAINTAIN INFRASTRUCTURE AND KEEP UP WITH ITS LIFECYCLE? AND WHAT COMMUNITIES AND OR BUSINESSES OR CONSTITUENTS IN THE CITY ARE GOING TO FACE THOSE COSTS DISPROPORTIONATELY? RIGHT. I THINK IT'S A GREAT QUESTION.

ALMOST, ALMOST RHETORICAL.

RIGHT. SO BY DEFERRING IT, ONE, IF I DON'T DO SOMETHING TODAY AND I SAY I'M GOING TO DO THAT TWO YEARS FROM NOW, CHANCES ARE IT'S GOING TO COST ME TWICE AS MUCH WHEN I GO TO BUY IT AT THAT POINT. RIGHT.

SO EVEN THOUGH I'M DEFERRING IT, I'M JUST COMPOUNDING THE IMPACT OF THAT.

BUT IN ADDITION, ESPECIALLY WHEN IT COMES TO INFRASTRUCTURE, A COUPLE OF THINGS YOU GOT TO KEEP IN MIND, UM, SOME THINGS HAVE THESE CRITICAL POINTS IN THEIR LIFE CYCLE.

SO INTERNALLY WE'VE BEEN TALKING A LOT ABOUT THE SAFE STORAGE TANKS.

FOR EXAMPLE, WE HAVE A WATER STORAGE TANK THAT WE CAN REHABILITATE.

I CAN SANDBLAST IT, I CAN PUT A NEW EPOXY COATING, AND I CAN EXTEND THE LIFE CYCLE OF THAT TANK.

IF I DEFER THAT TYPE OF MAINTENANCE, AT SOME POINT, THAT TANK WILL GET BEYOND THE PERIOD OF WHICH IT CAN BE REHABILITATED.

I CAN NO LONGER SANDBLAST IT BECAUSE IT'S TOO THIN.

NOW, INSTEAD OF BEING ABLE TO SANDBLAST AND PAINT IT, I HAVE TO CONSTRUCT A WHOLE NEW TANK, WHICH PROBABLY IS LIKE TEN TIMES THE AMOUNT TO BUILD A NEW TANK AS THE AS THE COATING. I THINK IT'S VERY SIMILAR WITH LIKE SEWER LINES.

A SEWER LINE CAN BE REHABILITATED UNTIL IT GETS TO THE POINT OF FAILURE THAT IT CAN NO LONGER BE, AND IT HAS TO BE EXCAVATED AND REPLACED.

AND I THINK VERY TYPICAL WOULD BE LIKE THE SAME LIKE THIS, LIKE YOUR WALL THICKNESS, ANY CORROSION ON THE TOP THAT WOULD WOULDN'T ALLOW YOU TO GO IN AND REHABILITATE IT.

IT'S BEYOND THAT.

IT'S BEYOND REPAIR. IT HAS TO BE REPLACED.

TWO COMPOUNDS.

RIGHT. IT WOULD. IT'S GOING TO COST MORE IN THE FUTURE BUT NOW CAN'T JUST REHABILITATE IT.

I GOT TO REPLACE THE WHOLE THING.

AND THE OTHER THING TO KEEP IN MIND WITH INFRASTRUCTURE.

AND UM, SO AGAIN, MAYBE YOU GET AWAY WITH IT THIS YEAR.

RIGHT. BUT NOT REPLACING THAT WATER LINE WHEN YOU CAN DO IT AT A SCHEDULE WITH TRAFFIC CONTROL PLANS AND DO ACTIVE BIDDING, IS NOW A MAJOR WATER LINE BREAKS THAT SHOULD HAVE BEEN REPLACED AND THE DAMAGE THAT THAT CAUSES, ESPECIALLY TO THE ROADWAY, TO OTHER UTILITIES, EVEN THE HOMES, ESCALATES THAT COST AS

[00:55:08]

NOW YOU'RE UNDER AN EMERGENCY, YOU PAY A PREMIUM FOR CONTRACTORS, YOU'RE WORKING AROUND THE CLOCK, SO YOU'RE PAYING OVER TIME AND YOU'RE DISRUPTING SERVICES.

YOU CAN'T GIVE OUT THE NOTICES AND SEWER WOULD ALSO DO THE SAME, RIGHT, ONCE A SEWER LINE COLLAPSES.

YOU'RE HAVING TO WORK THAT COMPLETELY UNTIL YOU GET IT REPAIRED AT WHATEVER THE COST IS.

AND SO YOU LACK THAT PLAN.

AND SO I THINK THERE'S JUST A COUPLE OF THINGS ON WHEN YOU DEFER ON HOW THAT ESCALATES IT.

I KIND OF FEEL LIKE YOU KNEW THE ANSWER TO THAT QUESTION WHEN YOU WERE ASKING IT, BUT HOPEFULLY DID ANSWER IT ANYWAY.

THANK YOU. SUFFICIENT.

HOW MUCH DOES PRIVATE DEVELOPMENT THESE PROJECTS THAT ALL OF A SUDDEN ARE NEEDED BECAUSE WE'VE DEVELOPED OUTSIDE OF THE CITY INFRASTRUCTURE.

AND I'M LOOKING AT YOUR LIST, YOU KNOW, AND SOME OF THESE I DON'T KNOW EXACTLY, YOU KNOW, BEULAH UNIVERSITY WATER LINE RELOCATION, I ASSUME THAT'S BECAUSE OF THE DEAL WITH THE PRIVATE DEVELOPER TO REALIGN UNIVERSITY.

UM, YOU KNOW, THERE'S OTHER ONES ON HERE.

J.W. POWELL OVERSIZING, THAT HAS SOME KIND OF MEMORY WITH THE ALL THAT DEVELOPMENT THAT'S GOING TO GET PUNCHED ALL THE WAY THROUGH PINEDALE WATER.

THEY'RE NOT EVEN IN THE CITY, BUT WE'RE UPSIDE SOME OF THESE THINGS.

I'M JUST CURIOUS ABOUT HOW MUCH DO DOES PRIVATE NEW PRIVATE DEVELOPMENT DOES THAT REALLY HOW MUCH DOES IT IMPACT YOUR BUDGETING. BECAUSE IT SEEMS LIKE IF YOU HAD A LIST OF PROJECTS, YOU HAVE SO MUCH MONEY IN THE POT, YOU HAVE THIS MANY PROJECTS THAT ARE PRIORITY FOR THIS YEAR, THEN ALL OF A SUDDEN YOU HAVE TO DO A WATER LINE UP.

SIZING A FORT TUTHILL.

WHICH IS ON HERE.

HOW MUCH DOES THAT IMPACT YOUR BUDGET? AND IF IT DOES, IS THERE ANY WAY TO TRY TO AVOID THAT IN THE FUTURE? OR IS THAT CAPACITY FEES SUPPOSED TO PAY FOR THAT? YEAH, I THINK THAT'S A GREAT QUESTION.

THAT'S A VERY COMPLICATED ONE.

SO I'M GOING TO TRY TO I'M GOING TO TRY TO SIMPLIFY IT A LITTLE BIT.

UM, SO ULTIMATELY IN WATER SERVICES THERE'S THERE'S SERVICES THAT WE'RE REQUIRED TO PROVIDE.

AND I CAN'T PUSH THAT ON TO DEVELOPERS.

RIGHT. THAT'S THAT'S MY JOB.

THAT'S WHAT I'M SUPPOSED TO DO. THAT'S WHY WE'RE HERE TALKING TODAY, THE EXTENSION OF THE LINE.

UM, THE DEVELOPER DOES PAY FOR THAT.

WHEN WE TAKE AN INITIATIVE TO SAY A DEVELOPER IS ONLY GOING TO BE REQUIRED TO PUT IN WHAT THEY NEED TO BE SUCCESSFUL.

RIGHT. BUT IF IT'S AN OPPORTUNE TIME TO SAY, OKAY, WELL, WE'RE FORWARD THINKING.

THAT. SO MAYBE THE DEVELOPER ONLY NEEDS A 12 INCH WATER LINE AND THAT'S ALL THEY'RE GOING TO PAY.

BUT IT'S IN OUR BEST INTEREST TO MAKE THAT A 16 INCH WATER LINE, BECAUSE IT'S NOT JUST ABOUT THAT DEVELOPMENT, IT'S ABOUT THE GREATER GOOD OF THE COMMUNITY.

THEN THAT UPSIZING THE CITY, THE WATER SERVICES WOULD BE ON THE HOOK TO PAY THE DELTA BETWEEN THE 12 AND THE 16.

AND SO SAY TYPICALLY, EVEN WHEN YOU SEE THE UPSIZING, IT'S PROBABLY NOT THE FULL PROJECT COST OF WHAT THE DEVELOPER IS INCURRING.

IT WOULD JUST BE THAT PORTION TO SAY, WELL, WHAT'S GOING TO MAKE THE COMMUNITY BETTER IN ADDITION TO THE DEVELOPER JUST DOING WHAT THEY NEED, RIGHT, AND NOT THINKING ABOUT THE BIGGER PICTURE? HOW MUCH DOES IT IMPACT YOUR BUDGET EVERY YEAR OR THESE PROJECTS? IT SEEMS LIKE IT'S ALMOST AN UNKNOWN.

OR GUESS YOU CAN SEE IT COMING A YEAR AHEAD WHEN SOMEBODY REZONES A PROPERTY OUT SOMEWHERE AND IT'S GOING TO BE A HIGH DENSITY, BUT YOU CAN KIND OF SEE THAT COMING, BUT THEN ALL OF A SUDDEN, DOESN'T THAT REALLY IMPACT YOUR BY PUSHING OTHER PROJECTS OFF BECAUSE THEY'RE MOVING FORWARD, THEY'RE GOING TO GO TO CONSTRUCTION. RIGHT.

SO ALL OF A SUDDEN YOU'VE GOT TO FUND THAT UPSIZE.

RIGHT. SO I THINK THERE'S A COUPLE OF SO AGAIN LIKE I SAID IT GETS A LITTLE COMPLICATED.

THERE'S A COUPLE OF APPROACHES THAT WE TAKE.

SO ULTIMATELY THAT DOES COME UP.

IF WE IF WE FIND A BENEFIT WITHIN THE BUDGET, I WOULD SAY WE DO MAKE THAT DECISION TO SAY WE NEED TO UPSIZE THIS ONE.

WE NEED TO FIND THAT IT IS POSSIBLE FOR A DEVELOPER TO PAY FOR THE COMPLETE UPSIZING AND GO INTO A REIMBURSEMENT IF IT'S CLEAR WHO'S GOING TO BENEFIT FROM THAT UPSIZING.

AND SO THEY CAN ENTER INTO A REIMBURSEMENT AGREEMENT THAT THE CITY WOULD FACILITATE TO HAVE THEM BURDEN THAT COST.

BUT THERE ARE PROJECTS WHERE WE LOOK AT IT AND SAY, THIS WOULD REALLY BE A GOOD IDEA TO BE A LITTLE BIT LARGER, BUT THERE'S NOTHING IN THE BUDGET THAT WE WOULD TRADE FOR THAT.

AND AT THAT POINT, THE DEVELOPER PUTS IN WHAT THE DEVELOPER NEEDS AND AND YOU'RE HOPING THAT YOU GET THROUGH THE LIFE CYCLE OF THAT ASSET BEFORE THAT UPSIZING IS REQUIRED.

SO AGAIN, WHAT YOU'RE TRYING TO DO IS WEIGH THE FACT THAT, AGAIN, WE PUT IN THE 12 INCH TODAY, IF I DON'T NEED THE 16 INCH FOR 20 YEARS, THE DEVELOPER IN THE 20 YEAR WOULD HAVE TO PAY FOR THE 16.

BUT IF I NEED THAT NEXT YEAR, IF I CAN'T GET IT THROUGH A REIMBURSEMENT AGREEMENT OR IF THE CITY IS NOT DIRECTLY BENEFITING FROM IT, YOU MAY CHOOSE NOT TO UPSIZE IT.

AND THERE ARE PROJECTS THAT WE DON'T UPSIZE FOR THOSE SAME REASONS.

THE ONES THAT WE DO UPSIZE THAT AGAIN, WE'RE LOOKING TO PUT IN THE VALUE TO SAY WITHIN THE LIFE OF THE ASSET WE WILL, AND THAT THERE'S A BETTER BENEFIT FOR THE CITY THAN THE PROJECT THAT WE'RE DEFERRING, BECAUSE THAT'S WHAT WE WOULD BE ULTIMATELY DOING.

[01:00:03]

IT'S SOMETHING THAT OCCURS EVERY DAY, AND IT DOES MOVE THE NUMBERS WITHIN OUR PROJECT.

THEY JUST HAVE A COUNCIL MEMBER HARRIS AND COUNCIL MEMBER MATTHEWS.

OKAY, SO LET ME JUST MAKE SURE THAT I HEARD YOU RIGHT.

THOUGHT I HEARD YOU SAY THAT RIGHT NOW THE DEVELOPER NEEDS A SIX, A 12 INCH.

OKAY, LET'S JUST PULL 12 INCH AND WE SAY THAT, OH, WE DON'T NEED A 16 INCH FOR 20, 25 YEARS.

SO THEN WHEN WE NEED THAT 16 INCH, DO WE CHARGE THAT BACK TO THE DEVELOPER TO DO.

BECAUSE WE COULD HAVE DONE IT 25 YEARS, EVEN THOUGH WE KNEW WE DIDN'T NEED IT THEN, BUT WE KNEW WE WOULD NEED IT IN 20 YEARS.

SO DO WE GO BACK TO THE DEVELOPER AND SAY, OH, WE WE NEED A 16 INCH ONE NOW AND YOU GET TO PAY FOR IT.

THE IT WOULD NOT. IN MY MIND, IT WOULDN'T PROBABLY WOULDN'T BE THE SAME DEVELOPER BECAUSE ALL THEY NEEDED WAS A 12 INCH.

DEPENDING ON WHAT'S TRIGGERING THE 16, IF IT'S A NEW DEVELOPMENT WE WOULD GO TO THE NEW DEVELOPER AND SAY, OF COURSE, BUT YOU HAVE TO UPSIZE IT.

YEAH, I THINK WHEN YOU LOOK AT LIKE WATER QUALITY, FIRE PROTECTION, MOVING THE SYSTEM AROUND, HOW YOU CAN CONTROL SOME OF THOSE ARE THE BENEFITS THAT WE'RE LOOKING FOR.

DEFINITELY WHEN WE IMPACT LIKE LARGER ENTITIES, LIKE WHEN YOU'RE BORN THE INTERSTATE, WHEN YOU'RE BORN, THE THE TRAIN TRACKS, LIKE THOSE ARE THINGS THAT WE WEIGH WHERE THAT'S WE DEFINITELY SEE THAT'S HARDER IN THE FUTURE AND LOOK TO KIND OF UPSIZE THOSE AS WELL.

OKAY. SO THEN JUST TO ADD TO THE CLARIFICATION, LIKE I THINK OF TIMBER SKY THAT IS BUILDING A HUGE MASTER PLANNED COMMUNITY, THEY'VE DONE DIFFERENT STAGES AND THEY'RE WAY OUT THERE BY WOODY WOODY ROAD.

BUT THEN THERE'S ALL THE HOUSES INFILLED, YOU KNOW, GOING AND GOING OUT TO THE SEWER LINES.

SO DOES THAT TRIGGER WHAT THEY'RE DEVELOPING OUT THERE? THEY MAY ONLY NEED A 12 INCH LINE, BUT NOW, BECAUSE OF THE GAP BETWEEN WHERE THEY'RE BUILDING AND WHERE THE END RESULT IS, DO WE DID WE DID WE CONCLUDE THAT WE NEEDED A 16 INCH LINE? THEY DIDN'T NEED IT FOR THEIR DEVELOPMENT, BUT TO BRING ALL THAT WASTEWATER THROUGH.

DOES THAT MAKE SENSE? IT DOES.

AND I THINK THERE'S A PORTION OF TIME WHERE THAT'S DEFINITELY ASSESSED, BUT THAT'S WHERE IT GETS BACK.

AND WE WORK VERY CLOSELY WITH OUR LEGAL TEAM TO DETERMINE WHAT'S THE MINIMUM LEVEL OF SERVICE I'M SUPPOSED TO PROVIDE.

AND AND AGAIN, WHEN WE'RE TALKING ABOUT THEM EXPANDING INFRASTRUCTURE THAT IS ON TOP OF THEIR CAPACITY.

SO ALSO WHEN THEY PAY THEIR CAPACITY FEES IS PAYING INTO BEING INTO A WELL OPERATED FUNCTIONING SYSTEM.

SO IF THERE IS A PORTION OF OF LINE WITHIN THE SYSTEM THAT DOESN'T HAVE, MAYBE LET'S JUST SAY IT DOESN'T HAVE THE CAPACITY FOR THE DEVELOPMENT, THAT COST IS NOT PUSHED ON TO THE DEVELOPER. RIGHT? THAT'S THAT'S MY JOB TO MAKE SURE THAT THAT WORKS.

THEY HAVE TO PAY FOR WHATEVER THEY PUT IN THAT THEY NEED AND WHAT THEY NEED.

AND THEN IF I REQUEST FOR THEM TO UPSIZE IT, IF I CAN'T GET IT REIMBURSED THROUGH OTHER PEOPLE WILL BENEFIT.

WE HAVE THE OPTION THAT WE CAN PAY FOR THAT UPSIZING WHERE IT BENEFITS THE THE WATER SERVICES OF THE COMMUNITY.

SURE. ANOTHER FOLLOW UP QUESTION.

THIS ONE'S KIND OF LIKE MY LAST ONE TO SEE A PATTERN.

SO IF YOU DEFER UPGRADING 12 TO 16, WHO IS GOING TO PAY LESS AND WHO IS GOING TO PAY MORE IN THE COMMUNITY? HOW DOES THAT SHIFT COST? WE YOU I THINK YOU JUST EXPLAINED THAT IT'S GOING TO INCREASE COSTS OVERALL, WHICH IT WILL.

RIGHT. BUT WHO WHO AMONG OUR BUSINESSES AND RESIDENTS IS GOING TO END UP PAYING LESS TODAY? AND WHO IS GOING TO PAY MORE LATER? AGAIN, THAT'S WHAT WE EVALUATE.

BUT THERE'S CERTAIN UPSIDES, THINGS THAT WE CAN PAY A LITTLE NOW UPSIZING THAT LATER WOULD BE A TREMENDOUS AMOUNT OF COST.

UM, TYPICALLY WHEN YOU'RE UPSIZING, THE ONLY THING YOU'RE PAYING THE DIFFERENCE IS, IS THE COST OF THE PIPE, RIGHT? EVERYTHING ELSE IS ALREADY HAVING TO BE DONE AND PAID FOR BY THE DEVELOPER.

IF YOU DON'T DO THAT UPSIZE AT THAT CRITICAL POINT, CHANCES ARE YOU HAVE TO RE EXCAVATE THE WHOLE SITE.

YOU ABANDON THAT PIPE AND YOU PUT IN THE BIGGER ONE.

SO IN THE FUTURE IT'LL.

YEAH. SO NOT ONLY WILL PRICES ESCALATE, BUT THE THE MAGNITUDE OF THE PROJECT BY NOT UPSIZING AT THAT CRITICAL TIME WOULD COST MORE AND THAT WOULD BE BORNE BY THE RATEPAYERS. RIGHT? I THINK SO, I THINK THE ANSWER, IF I'M CORRECT, IS THAT YOU'VE GOT RATEPAYERS PAYING MORE TODAY A TINY BIT MORE VERSUS PERHAPS THE PEOPLE BUYING THOSE HOMES, PAYING A LOT MORE FOR THEM 20 YEARS FROM NOW.

SO IT SOUNDS TO ME LIKE YOU'RE GOING TO THERE'S AN IMPACT ON HOUSING COSTS OR DEVELOPMENT COSTS LONG TERM.

IF YOU DO THIS, IT DEFINITELY IS.

[01:05:01]

IF BE A PORTION OF A SMALLER PORTION OF THAT.

BY NOT DOING THAT, THE DEVELOPER MAY ALSO EXTEND THEIR THEIR SERVICE AREA.

BUT IF THERE IS A BOTTLENECK OR A PINCH POINT WITHIN THE SYSTEM, THAT COULD STILL FALL BACK ON THE WATER SERVICES TO DO THAT CORRECTION, AND THAT WOULD COME AT A HIGHER COST.

SO EVEN IF IT WASN'T DIRECTLY TO THAT DEVELOPMENT COMMUNITY, IT COULD STILL MOVE BACK TO WATER SERVICES AS WELL.

IT MIGHT ADD ONE THING THOUGH.

REMEMBER, TOO, THAT A PORTION OF THAT COST IS LIKELY ELIGIBLE TO BE FUNDED WITH CAPACITY FEES.

SO IT'S NOT JUST RATEPAYERS.

THE NEW CUSTOMERS WILL PICK UP THEIR SHARE OF THAT AS WELL.

IT'S A TIMING ISSUE.

YOU KNOW WE SET THE CAPACITY FEES TO RECOVER THOSE COSTS.

BUT YOU KNOW, NEW HOMES ARE ADDED OVER TIME, A NEW COMMUNITY, NEW COMMERCIALS ARE ADDED OVER TIME.

CAN WE ALSO DO A CAPACITY? WE USED TO CALL THEM CAPACITY FEES.

THE CITY CAN DO A CAPACITY FEE.

AND INDEED DIDN'T WE JUST EXTEND ONE? SO THE HOSPITAL HAS TO PAY FOR AN OVERFLOW FOR AN OVERSIZE? WE DID. GOING OUT TO HIM.

I THOUGHT WE EXTENDED THAT.

COULD THAT THAT'S TRUE.

SO THAT WAS A RECAPTURE FROM SORRY, IT'S THE WRONG WORD FOR CURRENT DAY, BUT WE ALWAYS CALL THEM RECAPTURE.

CAN'T THE CITY DO A RECAPTURE FOR THE OVERSIZING OF THAT LINE? YEAH, I THINK THAT'S WHAT WE CALL THE REIMBURSEMENT.

BUT YEAH, THAT'S TRUE.

BUT IF WE MOVE ON TO THE WATER SCENARIOS AND THEN WE CAN HAVE MORE DISCUSSION ON THOSE.

LET'S SEE. IT'S ALL GOOD. BUT YOU CAN ALSO TELL HOW CAPITAL IMPROVEMENT PLANNING IS NOT VERY EASY.

WE'RE LOOKING AT THE END RESULTS OF MANY, MANY YEARS AND DISCUSSIONS.

OH THAT WOULD BE OKAY.

HERE WE GO. THANK YOU.

ALL RIGHT. WE'LL TALK ABOUT THE WATER FUND FIRST.

AND YOU'VE SEEN A VERSION OF THIS TABLE BEFORE.

THIS SHOWS US THE RESULTS AND THE PROJECTED RATE ADJUSTMENTS EACH YEAR FOR THE NEXT FIVE YEARS.

FOR EACH OF THOSE FOUR SCENARIOS WE DISCUSSED.

SO THE FIRST SCENARIO AGAIN IS THE CONSUMER PRICE INDEX OR CPI.

THAT SCENARIO WOULD FUND $120 MILLION OF CAPITAL IMPROVEMENT PROJECT COSTS FROM FISCAL YEAR 2024 THROUGH 2023. THE SMOOTH KETCHUP WOULD FUND $152 MILLION.

SO THAT'S A LITTLE BIT MORE GIVEN A LITTLE BIT HIGHER RATE ADJUSTMENTS IN THE NEAR TERM.

THE FULL FUNDING SCENARIO IS THAT FULL WATER WITH INFLATION OF 208 MILLION, AND THAT WOULD BE OVER THAT 11 YEAR PERIOD.

AND WE'RE OR EXCUSE ME, NINE YEAR PERIOD.

AND WE'RE LOOKING AT RATE ADJUSTMENTS IN THE NEAR TERM THAT ARE HIGHER THAN THEY TAPER OFF.

DISCUSSIONS A COUPLE OF WEEKS AGO WITH YOU GENERATED AN ALTERNATIVE OPTION WHERE WE LOOKED AT, LET'S CAN WE GET THE SAME RESULTS? CAN WE FUND THE SAME AMOUNT OF CAPITAL BECAUSE WE KNOW WE NEED IT, BUT AT A MORE SMOOTH LEVEL? THAT'S THE ORANGE ALTERNATIVE OPTION.

THAT'S STILL $208 MILLION OF CIP, BUT IT'S AN A LEVEL 15% ANNUAL ADJUSTMENT OVER THAT FIVE YEAR PERIOD.

THEN IT DROPS DOWN TO 5% PER YEAR.

SO THAT'S THE NEW SCENARIO THAT WE DISCUSSED A COUPLE OF WEEKS AGO.

EVERYONE REALLY PROBABLY WANTS TO KNOW WHAT THIS MEANS FOR A RATEPAYER.

THE NEXT SLIDE THAT AARON IS SHOWING YOU IS A TYPICAL WATER BILL IMPACT FOR A4000 GALLON USER, SO THAT'S 4000 GALLONS A MONTH.

WE UNDERSTAND THAT SOME USERS HAVE MORE USAGE, SOME LESS.

BUT THIS IS A TYPICAL BILL IN YOUR AREA AND THIS IS A RESIDENTIAL BILL.

YOU'LL SEE THAT THE VALUES FOR EACH OF THE SCENARIOS REPRESENT AN INCREMENTAL CHANGE IN A CUSTOMER'S BILL.

SO FOR THE FIRST CURRENT COLUMN IS ZERO BECAUSE THAT'S TODAY.

AND WITH THAT ADJUSTMENT A MONTHLY BILL WOULD GO UP $1.54.

THAT RANGES FROM $1.54 TO THE $6.19 PER MONTH FOR THE FULL FUNDING OPTION.

THE ALTERNATIVE FUNDING OPTION, HOWEVER, WOULD GET YOU TO THAT SAME RESULT OF THE $208 MILLION FULL FUNDING, BUT WITH AN ADJUSTMENT EACH MONTH FOR THE FIRST YEAR OF $4.66.

WHAT IS VERY INTERESTING ABOUT THIS NEXT SLIDE IS IT SHOWS YOU BASICALLY WHAT WE'VE BEEN TALKING ABOUT ON THESE SHEETS ON YOUR HANDOUTS.

THE APPROVED CIP, THE APPROVED PLUS INFORMED AND THE FULL CIP.

THIS MIDDLE SET OF BARS DOES NOT INCLUDE COST ESCALATION.

WHILE THIS SET OF BARS DOES INCLUDE ESCALATION, THIS IS MORE WHAT WE'RE FORECASTING REALITY TO BE AT THIS POINT.

AND THEN THESE ARE THE FOUR SCENARIOS AND HOW MUCH OF THE CIP WOULD BE COVERED.

[01:10:01]

BUT IN TODAY'S DOLLARS, NOT IN ESCALATED DOLLARS, IT WON'T COVER ALL OR 100% OF THE APPROVED BUDGET AT WITH COST ESCALATION.

THE SMOOTH CATCH UP VERSION WILL FUND THE APPROVED WITH ESCALATION, BUT IT WON'T COVER THE APPROVED PLUS INFORMED WITH ESCALATION.

AND THEN FINALLY, YOU SEE THAT THE LAST TWO SCENARIOS, FULL FUNDING AND THE ALTERNATIVE OPTION, BOTH COVER ALL OF THE SCENARIOS, PARTICULARLY THE FULL CIP WITH ESCALATION. ON A CHART YEAR BY YEAR FOR DIFFERENT SCENARIOS, LAY OUT IN A SIMILAR FASHION.

SO YOU SEE THAT OVER TIME WE'VE GOT SOME PROJECTS THAT WOULD NOT GET FUNDED UNDER THE FIRST TWO SCENARIOS, WHEREAS THE LAST TWO SCENARIOS EACH YEAR WOULD FUND THE SAME AMOUNT OF PROJECTS AS DEPICTED IN THE APPROVED PLUS INFORMED PLUS UNFUNDED. SOMETHING THAT WE HEARD FROM THE WATER COMMISSION IS THAT WHAT ABOUT OPERATING AND MAINTENANCE EXPENSES, AND HOW MUCH OF OUR COSTS ARE WE TALKING ABOUT FOR CIP VERSUS OPERATIONS VERSUS DEBT SERVICE? THIS CHART SHOWS US THE ANNUAL EXPENSES BY TYPE.

THIS PARTICULAR SCENARIO IS THE ALTERNATIVE OPTION FOR WATER, WHERE YOU HAVE THAT ANNUAL 15% ADJUSTMENTS.

THE OPERATIONS AND MAINTENANCE EXPENSES INCLUDE SALARIES AND BENEFITS AND CHEMICALS AND ELECTRICITY COSTS AND OPERATING CAPITAL, ALL TO MAINTAIN A HEALTHY SYSTEM.

AND YOU SEE THAT GOING UP PRETTY SLOWLY OVER TIME.

THE CIP, THOUGH, IS A LITTLE SPIKY, BUT THAT FULLY FUNDS THE FULL CIP.

THE PURPLE SECTION IS THE OUTSTANDING DEBT SERVICE, PLUS NEW DEBT FROM BORROWINGS THAT WE'RE PROJECTING.

SO IT'S A MIXTURE OF CASH BORROWING FOR DEBT, AND THEN THE CAPITAL IMPROVEMENT PROJECT COSTS THAT WOULD BE FUNDED THROUGH RATES. CAN WE GO BACK TO THAT FOR A SECOND? I KNOW THIS IS A NEW CHART.

DOES THAT MAKE SENSE? IS THAT GOOD CHART? OKAY, GREAT.

OKAY. ALL RIGHT, THEN, THE REST OF THE CHARTS FOR WATER JUST DEMONSTRATE THE IMPACT OVER TIME FOR EACH OF THESE SCENARIOS ON DIFFERENT TYPES OF USERS. SO OUR TYPICAL RESIDENTIAL CUSTOMER USING 4000 GALLONS A MONTH WOULD SEE THESE COULD SEE THESE TYPES OF BILLS.

AND REMEMBER THAT THIS THIS ISN'T THE RATE DESIGN PHASE OF THE RATE STUDY.

THIS IS JUST ASSUMING AN ACROSS THE BOARD INCREASE.

WE HAVEN'T EVEN LOOKED AT YOUR FIXED CHARGES OR YOUR TIERS OR YOUR TIERS, POSSIBLY FOR OTHER CUSTOMER CLASSES.

SO WE'RE JUST LOOKING AT ACROSS THE BOARD INCREASES.

THE HIGHEST LINES ARE FOR THE FULL AND THE ALTERNATIVE OPTION.

AND YOU'LL NOTICE THEY CONVERGE AT 2029.

SO THEY'RE IDENTICAL AFTER 2020 NINE INCHES TERMS OF THE IMPACT ON A CUSTOMER'S BILL.

IT JUST TAKES LONGER TO GET THERE FOR THAT ALTERNATIVE OPTION.

IT'S A SLOWER IMPACT OVER TIME.

MAY I ASK A QUESTION, CAROL? IF. OKAY, I'M A RESIDENT AND I'M SEEING THIS AND I'M LIKE, WHOA.

WOULD THE, UM, THE GROWTH RELATED PROJECTS ON ON HERE THAT THE DOLLARS AND MILLIONS OF DOLLARS THAT WOULD TRICKLE TO CAPACITY FEES, WOULD THAT REDUCE THESE AMOUNTS POTENTIALLY WHEN YOU GET TO THE RATE DESIGN PHASE? WE ARE WE'RE STILL LOOKING AT CAPACITY FEES.

AND SO THAT WE HAVE NOT INCORPORATED WE NEEDED AN INSTRUCTION ON WHAT LEVEL OF CIP AND PARTICULARLY GROWTH LEVEL OF IMPROVEMENTS TO INCLUDE IN THE CAPACITY FEE, SO THAT COULD THE CAPACITY FEES COULD BE ADJUSTED TO ACCOUNT FOR THAT, AND IT WOULD REDUCE A BILL, OR IT COULD REDUCE A BILL FOR A CUSTOMER.

THAT'S A POTENTIAL FOR THAT.

THAT'S AN IMPORTANT POINT. YEAH.

THIS IS JUST SORT OF WOULD IT BE A WORST CASE FOR RESIDENT AT THIS POINT IN TIME? WELL, WE ARE ASSUMING SOME LEVEL OF CAPACITY FEES ALREADY.

SO BUT SO IT COULD I'M NOT SURE I WOULD CALL IT THE WORST CASE BUT IT IS IT COULD BE REDUCED.

COUNCILMEMBER MATTHEWS AND THEN COMMISSIONER GOODELL IS IT RIDDLE OR RIDDLE.

SO TWO QUESTIONS BECAUSE YOU KNOW EVERYBODY'S WATER USAGE IS DIFFERENT.

SO IF I LOOK AT THE $36 TODAY, WHICH MY BILL IS NOT, AND THEN I LOOK AT 2033, BASICALLY I CAN DO THE MATH WITHOUT GOING BACK AND LOOKING AT MY USAGE AND SAY, MY WATER BILL IN THAT SPAN OF TIME IS GOING TO DOUBLE.

[01:15:04]

BUT YES, IF I USE IT THE SAME, IT'S GOING TO DOUBLE.

SO UM, AND THEN WITH THE CAPACITY FEES, LIKE ONCE WE APPROVE THIS RATE INCREASE, THAT RATE INCREASE IS GOING TO GO UP REGARDLESS OF CAPACITY FEES, BECAUSE THIS IS JUST BASED ON THE WATER USAGE THAT THE CONSUMER, WHETHER IT'S COMMERCIAL OR RESIDENTIAL, THIS IS BASED ON THE GALLONS PER USAGE.

AND SO WHETHER WE COLLECT MORE CAPACITY FEES OR NOT IS NOT GOING TO CHANGE ONCE WE SET THAT RATE IN MOTION.

COUNCILMEMBER MATTHEWS, I THINK IF IF WE SAY WE INCREASE THE CAPACITY FEES, IT WOULD IT COULD REDUCE THE TOTAL.

IT DOESN'T REDUCE THE TOTAL AMOUNT OF REVENUE THAT YOU NEED TO RECOVER THAT WE THAT WE GAIN FROM THIS PART OF THE STUDY.

BUT IT COULD REDUCE THE AMOUNT OF RATE REVENUE.

SO SO YES, IT COULD REDUCE THE BILL FROM OR THE IMPACT ON A CUSTOMER.

SO I GUESS I'M CONFUSED ON THAT BECAUSE ONCE WE SET OUR RATES GOING TO BE X PERCENT OR X DOLLARS PER GALLON.

AND THEN WE SEE AN INCREASE IN CAPACITY FEE COLLECTION, UNLESS YOU'RE SUGGESTING THAT WE GO BACK EVERY YEAR AND SAY, WOW, WE COLLECTED A LOT MORE IN CAPACITY FEES, WE CAN REDUCE THAT RATE ONCE WE APPROVE THIS RATE ADJUSTMENT.

THAT'S THE RATE ADJUSTMENT INDIVIDUALLY, WHAT WE'RE USING PER GALLON THAT WE USE.

I THINK I FINALLY UNDERSTAND WHAT YOUR PARDON ME SORRY.

SORRY FOR THAT. SO HERE WE'RE NOT SETTING A RATE.

WE'RE SETTING A RATE ADJUSTMENT TO RATE REVENUE NEEDED.

OH OKAY. SO IT'S NOT IT'S NOT SET.

AND THAT'S WHY WE HAVE THAT LITTLE FOOTNOTE THERE.

SO THIS DOESN'T MEAN THAT EVERYBODY'S RATE IS GOING TO GO UP BY 5% FOR THAT FIRST SCENARIO OR 15%.

WHAT IT MEANS IS THAT'S THE ADDITIONAL RATE REVENUE THAT IS NEEDED EACH YEAR.

AND THEN THROUGH THE RATE PROCESS, WE WILL REFINE HOW MUCH NEEDS TO BE RECOVERED FROM RESIDENTIAL CUSTOMERS, FROM COMMERCIAL, FROM YOUR OTHER TYPES OF CUSTOMERS TO COLLECT THAT SAME AMOUNT OF REVENUE BASED ON THE COST OF SERVICE PROCESS.

IS THAT BETTER? MAYBE FOR NOW.

A QUESTION THAT ASKED AT LAST WEEK'S WATER COMMISSION MEETING PERTAINING TO THE WILDCAT PLANT EXPANSION, WHICH IS A VERY LARGE CAPITAL EXPENSE, WHICH I UNDERSTAND IS NOT IN THIS STUDY.

THE FIRST PART OF THE QUESTION IS CONFIRMED THAT THAT LARGE COST IS NOT IN THE STUDY.

SO WHEN WE GET TO THE WASTEWATER SIDE, YOU'LL SEE THAT THE SCENARIOS WE'RE SHOWING YOU, THE EXPANSION IS NOT IN THERE.

HOWEVER, WE HAVE LOOKED AT IT, BUT IT DOES NEED FURTHER INVESTIGATION AS TO FUNDING SOURCES.

OKAY. SO AND THIS IS MAYBE A FOLLOW UP TO ERIN YOUNG'S POINT, BUT UNFORTUNATELY I DON'T THINK THAT THESE NUMBERS ARE ANYTHING CLOSE TO A WORST CASE SCENARIO BECAUSE THEY DON'T INCLUDE AT LEAST ONE MAJOR PROJECT THAT WE KNOW IS 100% COMING AT US IN SOME FORM.

UM, AND THERE MAY BE OTHER THINGS THAT HAPPEN AS WELL THAT WE CAN'T SEE COMING.

SO THESE NUMBERS ARE NOT A WORST CASE SCENARIO IN MY VIEW.

THEY ARE ACTUALLY A BIT OF AN UNDERESTIMATE EVEN WHEN YOU TAKE THAT INTO ACCOUNT.

I COULD ADD TO THAT TOO, BECAUSE THE UNFUNDED IS $57 MILLION AND MOST OF THAT IS IN THE GROUND INFRASTRUCTURE.

MOST OF IT. AND THEN I'M ALSO WONDERING, ARE THE DOLLARS ADJUSTED SO MUCH BY CANTERBURY NOW FOR A BUCK AND A HALF.

IS IS IT GOING TO BE $5? I'M JUST MAKING AN EXAMPLE.

BUT IS IT IS IT A JUST YOU HAVE THE DOLLARS ADJUSTED FOR THAT FAR DOWN THE ROAD TO WE HAVE THE BUYING POWER? YES WE DO.

THROUGH 2033 AT THIS POINT WE HAVE PROJECTIONS.

YES. OKAY. NOW ONE THING YOU TO KEEP IN MIND IS DEPENDING UPON HOW WE CONSERVE, THAT COULD PUSH OUT GAP RANCH AND OTHER 20 YEARS OR 30 YEARS.

JUST DEPENDS ON WHETHER WE GO IN AND START USING RECLAIMED WATER FOR OUR DIRECT POTABLE REUSE.

SO YOU GOT ALL THESE PIECES THAT WE DON'T KNOW WHAT'S GOING TO HAPPEN AT TEN, 20 YEARS.

SO ONE OF THE THINGS THAT WE'LL TALK ABOUT AFTER WE GET THROUGH THE SCENARIOS IS DON'T THINK WE'RE ASKING YOU TO COMMIT TO EVERY SINGLE YEAR HERE.

YOU KNOW, THIS IS SOMETHING THAT WE'RE FORECASTING AND WE AND CAN CHANGE OVER TIME.

[01:20:01]

YOU'RE NOT. I DON'T THINK YOU'RE COMMITTED TO SIGNING UP FOR THIS PROGRAM FOR THE NEXT FIVE YEARS OR TEN YEARS.

THAT WOULD BE IMPRACTICAL.

SO. SO JUST SO I'M SURE ABOUT THIS, THOSE COSTS UP THERE ARE FOR THREE PARTS OF THE WATER BILL.

THIS ONE IS JUST TWO PARTS.

TWO PARTS? WHICH TWO PARTS ARE.

THIS IS FOR YOUR WATER BASED CHARGE AND YOUR WATER USAGE RATE.

SO ON THIS HANDOUT THREE PAGES THIS GUY'S OUR WATER BILL SAMPLE.

IT'S FOR THE SEWER WE'LL GET TO NEXT.

ON WATER CONSERVATION, I JUST WANTED TO ADD THAT ON THIS PROJECT LIST.

BECAUSE WATER CONSERVATION HAS BEEN DROPPING AND WE STILL ARE ON TARGET FOR OUR WATER CONSERVATION STRATEGIC PLAN GOAL TO KEEP DROPPING TO A TOTAL OF 80 GALLONS PER CAPITA PER DAY.

WE'RE NOT TRIGGERING RED GAP RANCH IN THIS TEN YEAR PLAN.

WE'RE NOT TRIGGERING THAT INVESTMENT IN CONSTRUCTION.

WE WILL TRIGGER A GROUNDWATER WELL FROM TIME TO TIME THAT'S IN HERE.

SO BECAUSE OF OUR EFFORTS, WE HAVE SIGNIFICANT AVOIDED COSTS.

WE WOULD BE PAYING A LOT MORE TODAY.

AND OUR WATER RATE, IF IT HADN'T BEEN FOR WATER CONSERVATION EFFORTS THAT STARTED WITH CITY COUNCIL IN 1989.

AND I EXPLAIN A LITTLE OF THAT IN THIS HANDOUT, A Q AND A HANDOUT BASED ON QUESTIONS HEARD IN THE RETREAT AND OUR WATER COMMISSION MEETING.

MOST OF THE PROJECTS ARE MAINTENANCE RELATED REPLACEMENT, NOT ONES WHERE WATER CONSERVATION WILL PUSH THESE OFF.

I JUST THOUGHT THAT MIGHT HELP.

HEY AARON, THIS IS ANDY.

JUST REAL QUICK IF I COULD I JUST WANT TO CLARIFY THIS BUILD CALCULATION IS $36.

IT DOES INCLUDE THE ENERGY RATE TOO.

PERFECT. THANK YOU.

THAT'S A GOOD POINT. I WANTED TO ASK BUT DIDN'T KNOW IF YOU'D HAVE THE ANSWER, SO.

OH, ANDY SOUNDS LIKE.

OH. NOW I HAVE TO FIND IT AGAIN.

I'M SORRY. I HAVE.

THIS IS EMBARRASSING.

WHAT HAPPENED TO IT? SOMEBODY ASK A QUESTION.

IF YOU GO TO THE THE THE POWERPOINT, YOU CAN PROBABLY FIND YOUR RECENTLY USED, UM, IT CAME UP IN A DIFFERENT WINDOW AND I'LL ASK A QUESTION SINCE SHE SAID SOMEBODY SHOULD ASK HER.

THIS IS THIS IS FOR THE FUTURE.

BUT I FEEL REALLY STRONGLY ABOUT THIS.

YOU'RE NOT TO THE TIERED RATES YET.

AND WHAT I WANT TO SAY IS JUST THAT I THINK SOME OF THE HIGH USERS OF WATER AND RECLAIMED BOTH NEED TO PAY MORE OF THE BRUNT OF THIS.

I HAVEN'T A NAMELESS NEIGHBOR WHO IS STILL WATERING TO THIS MORNING.

OKAY. AND EVERY DAY.

AND THEN THINK ABOUT THE GOLF COURSES FOR RECLAIM.

THINK ABOUT YOU.

AND HOW MUCH WATER DO THEY USE? I THINK ABOUT THE FACT THAT YOU GUYS SHOULD GET RID OF THAT LAWN ON CITY HALL.

I KNOW IT'S RECLAIMED, BUT THAT'S A RESOURCE TOO.

SO I JUST WANTED. YOU ASKED FOR SOMEBODY TO MAKE A COMMENT.

THERE IT IS. I THINK YOU GET TO THE GET TO OUR WATER CONSERVATION PROGRAM.

NO KIDDING. AND THEY WILL.

WHEN YOU GUYS GET TO THE TIERED RATES, I'D LIKE TO SEE SOME OF THE BIG USERS CARRY SOME OF THE BRUNT, AND WE TRY TO LESSEN THE BRUNT OF THE SINGLE FAMILY HOME OR THE LOWER TIER USERS.

THANK YOU. AND LOWER THE PRICE OF THE BREWERY.

THAT'S RIGHT. OKAY.

THIS SOUNDS LIKE OUTDOOR WATER USE IS YOUR BIGGER CONCERN.

IF I HEARD YOU RIGHT, THOSE WERE OUTDOOR.

YEAH, SURE. YES, BECAUSE THERE'S A DESIGN FOR THAT.

FOR SURE. WHAT'S THE BREAK AGAIN FOR GALLONS FOR GOING FROM TIER ONE OR TIER TWO.

I THINK IT'S 3500, 500, 3500 GALLONS.

SO HERE'S OUR COMMERCIAL THE SAME CHART FOR COMMERCIAL.

AND THEN LET'S SKIM THROUGH SOME OF THESE OTHERS IF WE COULD.

YOU HAD SEEN THIS BEFORE.

AND NOW WE SHOW EXPLICITLY THE WATER ENERGY RATE FOR THE CITY.

[01:25:02]

SO DO THE REST OF CITIES NOT HAVE THAT SEPARATED OUT? THEY DO NOT. YEAH. THAT'S UNUSUAL.

SO THAT'S IN THEIR UNIQUE.

OURS IS VERY UNIQUE. AND THE SAME FOR COMMERCIAL.

YOU CAN SEE THAT WITH THE WITH THAT ENERGY COMPONENT.

IT'S RIGHT AT THE AVERAGE FOR THE SAMPLE OF YOUR PEERS.

THANKS ERIN. HOW ABOUT IF WE MOVE TO WASTEWATER AND THEN WE CAN COME CIRCLE BACK.

WASTEWATER HAS A SIMILAR TYPE SETUP BUT A LITTLE BIT OF A DIFFERENCE IN THE ALTERNATIVE OPTION.

SO JUST LIKE IN WATER WE HAVE THE CPI SCENARIO, SMOOTH CATCH UP SCENARIO AND FULL, FULL FUNDING.

THE AMOUNT OF FUNDING VARIES GREATLY ACROSS THE THREE OF THE SIP.

ACROSS THE THREE SCENARIOS AT THE TOP, THE ALTERNATIVE OPTION IS PRESENTED AGAIN TO LEVEL OUT THOSE INCREASES, THOSE INCREASES IN WASTEWATER RATE REVENUE.

AND IN THIS CASE IT'S NOT THESE ARE NOT EQUIVALENT IN TERMS OF TIMING.

IN ORDER TO GET A LOWER RATE ADJUSTMENT FOR THE FIRST TWO YEARS, YOU'LL SEE THAT'S 25% FOR THE FIRST TWO YEARS.

AND THEN IT DROPS TO 15% AND THEN TO TEN AND THEN FIVE, AND IT LEVELS OUT AT FIVE.

WE LOOKED AT THE DIFFERING SOME PROJECTS, AND THESE WERE ROUGHLY SOME ABOUT $3 MILLION IN THE FIRST THREE YEARS OF UNFUNDED TYPE PROJECTS AND PUSHED THEM OUT TO THE LATER YEARS.

THE IMPACT OF THAT, THAT DEFERRAL, AS WE DISCUSSED, IS HIGHER COST.

SO IN TOTAL, YOU'LL SEE THAT THE ALTERNATIVE OPTION, FULL FUNDING LEVEL, IS GREATER THAN THE FULL SIP.

IT'S 139 MILLION VERSUS 125 MILLION.

SO THAT IS THE RESULT OF PUSHING OUT PROJECTS AND BRINGING THEM BACK IN JUST OH THAT OH THERE WE GO.

OKAY. THAT'S GOOD. AS FAR AS THE IMPACT ON A CUSTOMER'S WASTEWATER MONTHLY BILL FOR RESIDENTIAL CUSTOMERS, YOU'LL SEE THAT THE SAME USER AT 4000 GALLONS WOULD SEE THEIR BILL ON THAT ALTERNATIVE OPTION INCREASED BY ABOUT $5.31.

ARE WE READY? YES.

OKAY, THEN.

HOPE IT'S OKAY IF I GO A LITTLE MORE QUICKLY.

I'M LOOKING AT THE TIME SO THAT THE SCENARIO FOR FUNDING THE DIFFERENT TYPES OF CAPITAL YOU'LL SEE IS VERY SIMILAR.

THE CPI SCENARIO DOESN'T COVER THE APPROVED SIP WITH ESCALATION.

THE SMOOTH CATCH UP DOES, BUT IT DOESN'T COVER, YOU KNOW, ANY MORE THAN THAT IT ONLY COVERS A PORTION OF THE APPROVED PLUS THE INFORMED SIP.

THE FULL FUNDING SCENARIO COVERS THE FULL WITH ESCALATION.

WE HAVE A FOURTH ORANGE BAR BECAUSE WITH, AS I MENTIONED, DUE TO THE COST OF THE DEFERRAL.

WE HAVE A LITTLE BIT HIGHER PROGRAM.

AND THAT'S THE HATCH PART.

AND HERE YOU SEE THE THE LINE CHART THAT'S VERY SIMILAR TO WHAT WE HAD LOOKED AT FOR WATER.

EXCEPT WE HAVE THAT HIGHER BAR OR EXCUSE ME HIGHER LINE OVER HERE THAN THE FULL VERSION.

AND THAT'S THE ANNUAL COST.

JUST LIKE FOR WATER, WE SEE THE DIFFERENT COMPONENTS OF THE REVENUE THAT NEEDS TO BE RECOVERED IN EACH OF THESE SCENARIOS.

SO THE O&M IS PRETTY CONSISTENTLY ESCALATING AT AN AVERAGE RATE ACROSS THE YEARS.

AND THEN THE SIP REPRESENTS THAT SIP LINE CHART THAT YOU JUST SAW.

PLUS BORROWING THE COST OF DEBT IS HERE.

THAT ANNUAL DEBT SERVICE PAYMENT IS THE PURPLE LINE THAT INCREASES IN THAT NEAR TERM.

AND THEN IT GETS PAID DOWN OVER THE LONG TERM.

UNLIKE WATER, THE RESIDENTIAL BILL IS FORECASTED TO BE DIFFERENT, SO YOU'LL SEE THAT IT STARTS AT $21 TODAY, AND THEN BY 2029, IT'S ABOUT $20 DIFFERENT THAN THAT FULL SIP VERSION FOR THE ALTERNATIVE OPTION.

AND OVER TIME, IT IS LOWER THAN THAT FULL SIP.

AND THAT'S AGAIN BECAUSE WE LOOKED AT DEFERRING THOSE PROJECTS AND PUSHING THEM BACK.

SAME PICTURE FOR COMMERCIAL CUSTOMERS.

AND THEN HERE'S THAT WASTEWATER BILL COMPARISON.

SO THESE ARE THE BILLS TODAY.

THIS IS A BILL TODAY FOR A RESIDENTIAL WASTEWATER.

YOUR WASTEWATER FEE OR WASTEWATER BILL IS JUST A USAGE PART OF THE BILL.

THERE'S NO FIXED COMPONENT TO THAT SERVICE CHARGE.

IT'S JUST A PER UNIT OF USE TYPE BILL WHICH AS YOU CAN YOU GO BACK AGAIN.

I THINK WHAT'S INTERESTING ABOUT THAT IS SOME OF YOUR PEERS ONLY HAVE A FIXED PART TO THEIR SEWER BILL, AND SOME AND SOME HAVE A BASE OR FIXED

[01:30:03]

AND YEAH, THERE WE GO.

SAME THING WITH COMMERCIAL.

OKAY, ONE MORE FUND AND THEN WE CAN HAVE SOME DISCUSSION.

THE RECLAIMED WATER SCENARIO SUMMARIES.

AGAIN, JUST LIKE WE SAW BEFORE, YOU'LL SEE A BIG DIFFERENCE BETWEEN THE FUNDING LEVEL OF $7 MILLION AND THE FULL FUNDING SCENARIO OF 69 MILLION.

WHAT HAPPENS WITH THE ALTERNATIVE OPTION IS PER YOUR POLICY, PER CITY POLICY, YOU CAN ONLY CHARGE THESE RECLAIMED RATES AT 35% OF THE POTABLE WATER RATE.

SO WE'RE LIMITED TO WHAT WE CAN DO FOR THIS OPTION.

THIS OPTION VIOLATES THAT POLICY.

SO THE FULL FUNDING OPTION IS NOT IS NOT A VIABLE OPTION UNDER THE CURRENT POLICY.

AND THEN YOU HAVE THE ALTERNATIVE OPTION THAT WILL GENERATE $11 MILLION IN FUNDING WITH THE SAME RATE ADJUSTMENTS THAT WE ASSUMED FOR WATER.

NOW THERE IS.

AARON, COULD YOU GO BACK ONE MORE TIME, PLEASE? THANKS. SO YOUR POLICY HAS BEEN IN PLACE FOR QUITE A WHILE, RIGHT ON THE RECLAIMED WATER RATE.

SEVEN YEARS, SEVEN YEARS.

AND IT CHANGED. IT WENT UP FROM 25 TO 35 OR SOMETHING.

AND 2016 POLICY.

OR IS IT A REGULATION OR POLICY? SO IT CAN BE CHANGED TO BE CHANGED OR IT CAN BE DISCRETIONARY, WHEREAS WATER AND SEWER CANNOT BE.

THAT HAS TO BE BASED ON THE COST OF SERVICE.

I JUST WANTED TO POINT OUT THAT IT'S A POLICY DECISION THAT COULD BE CHANGED IF YOU WANTED TO FUND MORE CAPITAL ON THE RECLAIMED SIDE, OR FIND OTHER ALTERNATIVE SOURCES FOR FUNDING THAT PROGRAM.

SO THIS IS ALL LOADED ON USERS OF RECLAIMED WATER? YES. SO MAINLY SNOWBOWL GOLF COURSES.

CITY, CITY.

YOU HAVE NINE, NINE, NINE, NINE ACCOUNTS.

THOSE ARE THE FOUR ACCOUNTS WE HAVE.

WE HAVE LIKE 70 USERS, 70 AGREEMENTS.

SO UNDER OUR CURRENT POLICY, HOW DO WE MAKE UP THAT DIFFERENCE BETWEEN FULL FUNDING AND ALTERNATIVE OPTION.

CURRENTLY. IT'S NOT.

IT'S NOT IN PRACTICE.

SO THIS WOULD JUST BE IF YOU WERE ABLE TO IF YOU DECIDED TO GO WITH THE ALTERNATIVE OPTION ON THE WATER SIDE AND YOU INCREASED YOUR OR YOU ADJUSTED YOUR RATE REVENUES FROM WATER BY 15%, THEN THAT.

WE COULD. THE RECLAIMED RATE COULD BE ADJUSTED BY 15%, AND YOU WOULD BE ABLE TO FUND $11 MILLION OF PROJECT COST RATHER THAN THE FULL AMOUNT.

RIGHT. SO WE'VE GOT 69 MILLION IN.

IN NEED.

HOW DO WE MAKE UP THAT DIFFERENCE? HOW ARE WE PAYING FOR THE REST OF IT? WELL, MAYOR, THIS IS CURRENTLY NOT APPROVED.

SO ALL THOSE ADDITIONAL PROJECTS ARE NOT APPROVED FOR BEING COMPLETED.

SO YOU WOULD HAVE TO FIND ANOTHER FUNDING SOURCE AND IT COULD BE WHAT RICK PRESENTED.

LOOK FOR PERHAPS A SHARE FROM OTHER OTHER FUNDS OR FROM.

YES. I THOUGHT YOU WERE GOING TO SHOW ME ANOTHER SLIDE THAT'S LIKE, AND THIS IS HOW WE PAID FOR IT.

SO YEAH. SO $12.8 MILLION OF THAT INCREASE COMES FROM ONE PROJECT.

AND THAT'S THE WATER LINE LOOP FOX GLEN PARK TO CONTINENTAL.

SO WHAT'S THAT ALL ABOUT? SO THAT PROJECT IS PRIORITIZED PRETTY LOW.

THAT WOULD FULLY LOOP THE PURPLE PIPE SYSTEM AROUND THE CITY.

SO IT CLOSES THE GAP BETWEEN THE RIO LOOP AND THE WILDCAT LOOP.

AND IT PROVIDES FOR JUST A BETTER SERVICING OF THE LINE.

BUT IT DOESN'T ADD CAPACITY OR ANYTHING.

IT'S JUST SOMETHING WE WOULD LIKE TO DO SOMEDAY.

SO IF YOU IF IF YOU WOULD DROP THAT OUT OF THE MIX LIKE RED GAP, WHAT EFFECT WOULD THAT HAVE? SO I'M SORRY, CAN YOU HEAR IF YOU WERE TO TAKE THAT 12.8 MILLION OUT LIKE WE DID FOR RED GAP RANCH BECAUSE IT'S WAY OUT THERE, HOW WOULD THAT AFFECT THESE PROJECTIONS? IT WOULD LOWER THE.

69 MILLION BY 12 MILLION.

YES. SO THAT'S WHERE LISA PROVIDED A PRIORITIZATION LIST THAT INCLUDES THESE RECLAIMED PROJECTS.

SO THAT'S JUST SOME THAT MIGHT HAVE TO BE A SEPARATE DISCUSSION BECAUSE RECLAIM ISN'T THERE ARE SOME PROJECTS ON THAT LIST THAT AREN'T CRITICAL.

AND I HOPE YOU DON'T MIND ME.

THAT'S MY VIEW IS IT'S LIKE LOOPING THE SYSTEM HAS BEEN A TO DO IN THE FUTURE.

[01:35:02]

I THINK THERE'S SOME PROJECTS THAT ARE LESS CRITICAL TO PROVIDING THE LEVEL OF SERVICE FOR CURRENTLY.

YEAH, YEAH. SO THINK WE DID IDENTIFY WHAT THE RECLAIMED.

SO SPECIFICALLY TALKING ABOUT THIS LINE EXTENSION OPERATIONAL.

THERE'S VALUE IN THAT RIGHT.

LOOPING THE SYSTEM AROUND CREATES REDUNDANCY ON HOW WE PROVIDE THAT SERVICE TO CUSTOMERS FROM OUR EFFICIENCY OF HOW WE PUMP IT TO CHEMICAL ADDITION.

SO IT'S MORE OPERATIONAL STRATEGY.

BUT IF THAT LINE WASN'T LOOPED, ALL OF OUR CUSTOMERS WOULD HAVE WATER BECAUSE WE GIVE THEM WATER TODAY.

AND SO AGAIN, IT'S SO IT'S LOW IN THE PRIORITY, MEANING IT WOULDN'T JUMP OVER OTHER PROJECTS.

BUT IF WE EVER RAN OUT OF THINGS TO DO, THAT WOULD BE SOMETHING THAT WE WOULD OPERATIONALLY, WE COULD BENEFIT FROM BY DOING THAT.

SO WE DO HAVE IT LISTED AS A PROJECT.

IT'S UNFUNDED NOW.

AND LIKE YOU SAID, LOW ON THE PRIORITY BECAUSE IT'S NOT THAT CRITICAL SERVICE.

BUT THERE IS STILL A VALUE.

THERE'S NOT THINGS ON THE PLAN THAT AGAIN, WE'RE JUST DOING FOR THE FUN OF IT.

RIGHT? THERE'S THERE'S A REASON WHY IT'S A PROJECT JUST DOESN'T ALIGN MORE IMPORTANT THAN SOME OF THE OTHER ONES HERE TO DO THAT PROJECT.

WOULD IT AFFECT OTHER PROJECTS THAT YOU HAVE IN LINE IF WE DID THAT ONE EXPANSION OF THE.

THE VOLUME YOU COULD PUMP UP TO THE BUFFALO PARK TANK.

YEAH. SO EVEN WITH THAT'S LISTED NOW, THOSE PROJECTS DO LIST HIGHER IN THE PRIORITY THAT WE WOULD DO THOSE FIRST.

RIGHT. AS WE DID THOSE PROJECTS.

IF YOU HAD THE LOOP YOU WOULD STILL NEED THEM.

YEAH. IF NOT I THINK YOU'RE RIGHT.

THAT ALTERNATIVE WOULD BE SOMETHING THAT WOULD LOOK AT.

BUT IT WOULD BE AN INTERESTING TO.

THIS IS A VERY COMPLICATED PLAN WITH SOME VERY LARGE UNCERTAINTIES IN IT.

THIS IS SOMETHING THAT I THINK IS WORTH POINTING OUT.

RIGHT. SO WE'VE BROKEN THIS DOWN.

WE'VE WE'VE LISTENED TO IT.

THE ENGINEERS HAVE BEEN ALL OVER IT AND THE STAFF, AND WE'RE STILL LOOKING AT SOME VERY LARGE UNCERTAINTIES ABOUT HOW MUCH THINGS ARE GOING TO COST, BECAUSE.

WE'VE JUST GONE THROUGH 30 TO 120% INFLATION IN COSTS IN THREE YEARS, AND WHO KNOWS WHAT'S GOING TO HAPPEN IN THE NEXT 20 YEARS WHEN THAT STARTS HAPPENING? I MEAN, THESE THINGS COULD ALL BE TEN TIMES AS MUCH 20 YEARS FROM NOW, OR THEY COULD BE LESS.

IT'S BECAUSE WE JUST HAD CRAZY SHOCKS TO THE ECONOMY AND THE PRICES.

SO THERE'S A BIG UNCERTAINTY.

THERE'S ALSO WILDCAT EXPANSION, WHICH IS AS BIG AS ALL OF THESE THINGS ADDED TOGETHER.

AND THE WASTEWATER, THAT'S ANOTHER $200 MILLION, GIVE OR TAKE $100 MILLION.

SO WHEN I DEAL WITH PROBLEMS LIKE THIS, I TRY I TRY TO TAKE A PHILOSOPHY TO DECISION MAKING THAT I WANT TO RECOMMEND TO YOU ALL.

UM, THERE'S A FEW THERE'S A FEW STRATEGIES.

FIRST ONE IS RECOGNIZE THAT THIS PLAN IS GOING TO CHANGE DRAMATICALLY IN TERMS OF ITS SIZE AND SCOPE IN WAYS THAT WE CAN'T PREDICT, IN MY VIEW.

UM, AND SO YOU NEED TO PRIORITIZE AN APPROACH TO THE PLAN THAT'S FLEXIBLE AND RESILIENT, WHERE IF SOMETHING BIG CHANGES OR GOES WRONG OR WE CAN ROLL WITH THAT, WE DON'T WANT TO.

WE DON'T WANT TO HAVE A VERY FLEXIBLE PLAN.

WE NEED SOME BREATHING ROOM AND SOME FLEXIBILITY.

THAT'S IMPORTANT. ANOTHER WAY I LIKE TO THINK ABOUT THIS IS JUST TO THINK ABOUT WHAT'S BIG AND WHAT'S SMALL, SOMETHING I TEACH IN ENGINEERING CLASS, IT'S ONE OF THE FUNDAMENTALS OF ENGINEERING IS THAT YOU JUST FORGET ABOUT ANYTHING THAT'S LESS THAN 10%.

IT'S WHEN YOU'RE HAVING YOUR DISCUSSIONS ABOUT DESIGNING A SOLUTION, A COMPLICATED SITUATION.

ASK WHAT'S BIG? AND ALL THE STUFF THAT ALL THE STUFF THAT DOESN'T ADD UP TO 10% IS KIND OF DOWN IN THE NOISE.

NOT THAT IT DOESN'T MATTER, BUT IT'S NOT GOING TO SOLVE THE PROBLEM FOR YOU, RIGHT? SO WHEN YOU'RE FOCUSING ON SOLUTIONS, YOU WANT TO BE TALKING ABOUT THE STUFF THAT'S 50% OF THE PROBLEM, 20% OF THE PROBLEM, NOT THE STUFF THAT'S 2% OF THE PROBLEM.

IT'S IT'LL GET SOLVED ONE WAY OR ANOTHER.

BUT THE 50% STUFF'S NOT GOING TO SOLVE ITSELF.

RIGHT. SO MY QUESTION THAT'S THERE'S SOME PHILOSOPHY JUST IN CASE IT'S HELPFUL.

UM, SO WE'RE LOOKING AT NUMBERS THAT ARE BIG, THEY'RE UNCERTAIN.

AND THEY'RE NOT JUST BIG FOR WATER SERVICES.

THESE ARE BIG NUMBERS COMPARED TO THE CITY'S OVERALL OPERATIONS.

RIGHT. NOT JUST CONSEQUENTIAL FOR RATEPAYERS.

THESE ARE CONSEQUENTIAL FOR THE WHOLE FINANCIAL FUTURE OF THE CITY.

RIGHT. WE'VE HAD ELECTIONS THAT WERE FOUGHT OVER $70 MILLION.

[01:40:04]

RIGHT. SO THIS IS BIG.

UM, ANYWAY, MY QUESTION FOR THE STAFF AND THE ENGINEERS IS WHAT'S BIG HERE? WHAT'S BIG? WHAT ARE THE BIG THINGS? WHAT ARE THE 2 OR 3 BIG, BIG OLD MARBLES IN THE JAR THAT WE COULD BE LOOKING AT TALKING ABOUT HERE? UM, I THINK THERE'S A COUPLE OF APPROACHES.

UM, SO I THINK WHEN YOU GO BACK TO THE STAPLES SHEET, THE ONES THAT YOU SEE THE X'S BY ON WHAT'S FUNDED LIKE, THOSE ARE THE BIG ONES.

THESE ARE THINGS WE LIKE.

THEY'RE HAVING TO BE DONE. THEY'VE GOT TO MOVE FORWARD.

AND AS STANTEC ALLUDED TO, LIKE ON THE PATH THAT WE'RE AT, LIKE ESCALATION HAS LEAVES US BEHIND.

WE'RE NOT GOING TO BE ABLE TO DO THIS STUFF WITH THE X'S LIKE THAT HAS TO BE DONE.

I KNOW THAT, UM, MR. TEDDER HAS TALKED BEFORE THE GROUPS, TOO, ABOUT WHEN YOU'RE FUNDING PROJECTS WITH ONE TIME MONEY THAT'S REOCCURRING, COSTS LIKE THAT HAS TO BE FIXED.

SO ALL OF THESE THINGS THAT WE'VE BEEN DOING RIGHT, THEY'RE KIND OF CATCHING UP TO US.

SO WE HAVE TO RIGHT SIZE THAT.

UM, I THINK SPECIFICALLY FOR WASTEWATER, IT COMES DOWN TO LIKE THE TWO BIGGEST THINGS ON THAT LIST IS GOING TO BE YOUR.

SOLIDS HANDLING AND YOUR COLLECTION SYSTEM.

RIGHT. THERE ARE TWO PROJECTS RIGHT NOW THAT.

THAT WE'RE WORKING ON.

AND THAT'S THE REAL SOLIDS HANDLING AND THE WILDCAT INTERCEPTOR.

LIKE THOSE THOSE PROJECTS OUGHT TO BE WELL UNDERWAY BEFORE THIS RATE EVEN HAPPENS.

LIKE. THOSE ARE JUST THINGS THAT LIKE IT'S IT'S OUT THERE IN THE REAL WORLD AND THOSE HAVE TO BE DONE.

AND THOSE ARE GOING TO BE PROBABLY CLOSE TO I'M JUST BALLPARK, PROBABLY $15 MILLION WORTH OF WORK.

THAT'LL BE IN THE DESIGN OR UNDER CONSTRUCTION RIGHT BEFORE WE EVEN FINISH THE RATE STUDY AND TALKING ABOUT HOW WE'RE GOING TO COLLECT THE REVENUES.

THAT'S A BIG THAT'S A BIG NUMBER.

IN ADDITION TO THE BOND PROJECTS THAT WE LISTED THAT ALREADY CAME UP.

A COUPLE OF YEARS AGO AND WENT THROUGH A AND WENT THROUGH ITS KIND OF OWN ITERATION, LIKE THOSE ARE HAPPENING.

BETWEEN STORMWATER AND WASTEWATER, THAT'S $60 MILLION WORTH OF BOND PROJECT BOND PROJECTS.

AREN'T EVEN LISTED. THEY'RE NOT LISTED IN THERE.

SO THAT'S $60 MILLION WORTH OF WORK HAS TO ALSO BE DONE.

SO WHEN YOU'RE LOOKING AT THAT FIVE YEAR WINDOW, JUST THE BOND PROJECTS AND THE TWO AND WASTEWATER, RIGHT.

YOU'RE TALKING $110 MILLION OF PROJECTS THAT HAVE TO TURN OUT.

BUT AND AS YOU APPOINTED TO WRITE THAT EVERY DAY THE CHANGE THOSE NUMBERS, RIGHT.

EVERY DAY THAT NUMBER IS CHANGING.

SO THE FASTER WE TURN THOSE PROJECTS OUT TO TRY TO GET AHEAD OF THAT INFLATION CURVE, THOSE ARE THE THINGS THAT HAVE TO HAPPEN.

I THINK WOULD PROBABLY ALSO SHARE THAT BECAUSE WE DO LOOK AT GRANT FUNDING.

I KNOW AARON AND HER TEAM JUST GOT US A ONE GRANT AWARDED.

I THINK THE NEXT ONE IS IN THE QUEUE THAT SHE'S I KNOW SHE'S GOING TO GET IT.

SHE WON'T LET ME SAY IT, BUT I KNOW SHE'S GOING TO GET IT.

AND WE HAVE OTHER GRANT APPLICATIONS.

I THINK THE CHALLENGE THAT WE HAVE IS THIS MENTALITY OF WE KNOW THIS STUFF HAS TO BE DONE.

WE KNOW GRANTS, FUNDING OPPORTUNITIES ARE IN OUR THAT IS A TOOL IN OUR TOOLBOX, AND WE HAVE TO MAXIMIZE THAT.

AND WE DO WORK TO DO THAT.

I THINK UNFORTUNATELY, SOMETIMES WE GET SO AMBITIOUS THAT WE TAKE A PROJECT THAT HAS TO BE DONE TODAY, AND WE PUT THAT ON THE GRANT LIST.

AND IF THE GRANT IS GOING TO TAKE YOU 2 OR 3 YEARS TO SECURE THE GRANT, THAT PROJECT.

CHANNEL WAS WAIT 2 OR 3 YEARS, RIGHT? AND YOU BEGIN TO FILL THAT THING.

SO WE DO. SO EVEN THOUGH IT'S PART OF OUR STRATEGY, I FEEL LIKE WE DO HAVE TO GET A LITTLE SMARTER ON HOW WE APPLY, WHAT PROJECTS AND HOW WE DO THAT AND THE THINGS THAT HAVE TO BE DONE TODAY.

WE DO HAVE TO DO THOSE TODAY.

AND WE GOT TO WE GOT TO RECONSIDER THAT.

I THINK THAT'S THAT'S SOMETHING WE'RE LEARNING TO NAVIGATE THROUGH.

BUT FOR SOME OF OUR LARGER PROJECTS, THAT IS A BIGGER PORTION OF WHY IT'S NOT INCLUDED IN THE RATE STUDY IS, AGAIN, WE'RE SUPER OPTIMISTIC THAT ONE, WE'RE GOING TO APPLY FOR THOSE GRANTS AND THOSE APPLICATIONS AND THAT OTHER FUNDING AND THAT WE'RE GOING TO BE SUCCESSFUL AT LEAST GETTING A PORTION OF IT.

AND WE NEED THAT STUFF TO CONTINUE TO DEVELOP AS WE DETERMINE WHAT IT IS WE'RE LOOKING TO DO AND HOW THAT FUNDING COMES IN DOING THE RIGHT THING AT THE RIGHT TIME.

THAT'S WHY THEY WEREN'T INCLUDED IN BECAUSE THAT HAS TO BE OUR STRATEGY GOING FORWARD.

BUT THE THINGS THAT HAVE TO HAPPEN TODAY, I THINK YOU CAN TELL ON THERE THE THINGS THAT ARE FUNDED THERE, THE THINGS THAT WE'RE MOVING ON.

THAT'S WHY THAT'S WHY WE'RE HAVING TO THAT'S WHY WE'RE MOVING ON THEM.

AND HOPEFULLY THAT KIND OF ANSWERS YOUR QUESTION A LITTLE BIT.

WHEN YOU SAID, WHAT'S THE.

WHAT ARE THE HOT TOPICS OR WHAT ARE THE THINGS THAT HAVE TO BE DONE NOW? A CITY MANAGER.

AND THEN.

HOW DO WE.

YEAH. TAKE PUBLIC COMMENT.

DO WE NEED CARDS? DO YOU NEED TO KEEP CARDS FOR ME TO HAVE CARDS? YES, BUT WE CAN DO IT KIND OF IN FRONT.

OKAY. SO, UM.

SO ONE MOMENT, PLEASE.

WARD. CITY MANAGER.

THANK YOU. THIS GOES TO COMMISSIONER GOODELL'S COMMENTS.

UM, AND I TEND TO AGREE THAT, YOU KNOW, IDENTIFYING MAJOR PROJECTS THAT ARE UNFUNDED AND THEN A LOT OF THE OTHER

[01:45:06]

BUT AND I TALKED ABOUT THIS EARLIER TODAY IN A STAFF MEETING, WILDCAT EXPANSION DOES NOT FIND ITS WAY TO THE AUDITOR'S MATRIX, BUT IT'S REFERENCED AS TABLE ONE MAJOR PROJECT AT $220 MILLION, IN ADDITION TO ANOTHER 25 MILLION FOR DESIGN. SO $245 MILLION.

AND THEN TABLE TWO SPEAKS TO UNFUNDED PROJECTS.

WELL, MY QUESTION IS WILDCAT CERTAINLY IS UNFUNDED, BUT DOES IT SUFFICE SIMPLY TO REFERENCE IT HERE IN TABLE ONE AS A MAJOR PROJECT? SHOULD IT BE CLEARER THAT MAYBE WE HAVE A TABLE OF ALL UNFUNDED PROJECTS, AND YOU CAN SEPARATE THOSE OUT INTO MAJOR PROJECTS AND MINOR PROJECTS OR HOWEVER YOU WANT? BUT I GUESS WHAT I'M ADVOCATING IS WILDCAT JUST JUST SEEMS TO BE REFERENCED HERE AS A COMPANION TABLE TO TO THIS NOT AT ALL SUGGESTING THAT THE HEART OF THE CITY, BUT I'M VERY MUCH SUGGESTING IT BE EMBEDDED WITHIN THE CAPITAL IMPROVEMENT PLAN AS AN UNFUNDED PROJECT BECAUSE OF ITS IMMINENCE.

I MEAN, IT THIS IS A PROJECT THAT WE'VE OFTEN TALKED ABOUT SHOULD START MATERIALIZING WITHIN THE NEXT FIVE YEARS.

UM, SO YEAH, THOUGHTS WE DID TALK ABOUT THIS WITH ANDY AS WELL, AND WE DEVELOPED AN APPROACH.

UM, HOW IS IT BEST TO.

DISCUSS THAT APPROACH WITHIN THE FRAMEWORK PROVIDED JUST NOW? WELL, I THINK IF I MIGHT BELIEVE WHAT YOU'RE SAYING IS THAT RIGHT NOW WE'RE REMOVING THE WILDCAT EXPANSION FROM THE UNFUNDED LIST WHEN IT IS TRULY UNFUNDED TODAY.

SO BY REMOVING IT FROM THE CIP DISCUSSION, WE'RE NOT ACKNOWLEDGING THAT IT IS STILL A NEED AND IT'S NOT INCLUDED. WHEN WE WERE DOING OUR MODELING, WE INCLUDED IT AS A WE'LL CALL IT A TOGGLE THAT WE CAN TURN IT ON AND TURN IT OFF IN THE MODEL. WHEN WE RAN OUR NUMBERS, WE HAD QUESTIONS ABOUT THE TIMING AND THE FUNDING SOURCES.

SO ARE YOU ASKING US TO JUST ACKNOWLEDGE THAT IT IS STILL UNFUNDED, BUT WE'RE NOT INCLUDING THE DOLLARS IN OUR VALUES UP HERE? YEAH, I'M I'M SUGGESTING THAT IT BE GIVEN MORE PROMINENCE WITHIN THE OVERALL.

AND I KNOW THERE'S UNCERTAINTIES ABOUT IT, BUT I THINK IT'S IT'S PAST THE POINT OF REFERRING TO IT AS A PROJECT THAT'S JUST OUT THERE, AND IT'S JUST GOING TO GET REFERENCED IN SOME FASHION.

I THINK IT NEEDS MUCH MORE DISCUSSION THAN THAT.

AND I DON'T KNOW HOW THAT HAPPENS.

YOU KNOW, HOW YOU DO GIVE IT MORE RELEVANCY WITH THIS TOPIC, BUT IT'S JUST A CURIOSITY TO ME THAT YOU HAVE A LIST OF UNFUNDED PROJECTS IN WILDCAT, IN MY OPINION, SHOULD BE LIKE AT THE TOP OF THAT LIST.

DO YOU WANT TO SEE YOUR KIND OF.

SO YEAH, WE HAD A CONVERSATION EARLIER.

WE'RE NOT EXACTLY SURE WHAT WILDCAT LOOKS LIKE, BUT WE TALKED ABOUT AT LEAST PUTTING A LINE IN THE OF A FIVE YEAR PLAN.

AND WHAT WE START DEVELOPING FOR COUNCIL ON AN ANNUAL BASIS AND 510 YEAR PLANS.

BUT THERE HAS TO BE AN OFFSET TO BALANCE OUT.

WE'RE JUST TALKING ABOUT PUT A PLACEHOLDER AS FINANCING TO BE DETERMINED BECAUSE WE HAVEN'T DECIDED IF IT'S RATES.

IT GOES BACK TO THIS TABLE.

HOW ARE WE GOING TO GET THERE TO DELIVER WILDCAT SO WE CAN PUT IT IN THE CIP AS A PROJECT WE NEED TO DELIVER, WHICH IS IMPORTANT TO KEEP IT THERE.

BUT UNDERSTANDING THAT IT'S NOT FUNDED, BUT IT HAS A DETERMINATION THAT WE HAVE TO MAKE WITHIN THE NEXT THREE YEARS, FIVE YEARS WHEN WE WANT TO DELIVER THAT PROJECT. WE'RE PROBABLY LOOKING AT ABOUT THREE YEARS OUT UNTIL WE HAVE DESIGN DONE, AND THAT WOULD PROBABLY BE A COMEBACK.

IN CONVERSATION WITH COUNCIL AND WATER COMMISSION.

HOW DO WE NOW MOVE THAT FORWARD? BUT YEAH, WE'RE TALKING ABOUT GETTING THAT DEFINITELY PROMINENT IN OUR FIVE YEAR.

THANK YOU. THANK YOU.

ANDY DID ANDY BURNHAM HAVE DID YOU WANT TO PRESENT WHAT YOU'VE BEEN WORKING ON ON THIS? YEAH I WAS JUST GOING TO SAY THIS DISCUSSION I THINK IS TYING A FEW DIFFERENT COMMENTS THAT I'VE HEARD TOGETHER.

I THINK, YOU KNOW, WHEN WE LOOK AT THE PROJECTIONS THAT WE DO IN THE RATE STUDIES, YOU KNOW, WE'RE DOING A MULTI YEAR FORECAST AND MANY COMMUNITIES WILL ADOPT A MULTI YEAR PLAN OF INCREASES. BUT WE DO HAVE A FAIR DEGREE OF UNCERTAINTY IN SOME BIG ISSUES THAT WE HAVEN'T FULLY TACKLED YET.

AND SO YOU KNOW ESPECIALLY RELATIVE TO WILDCAT KNOWING THAT YOU HAVE SOME MASTER PLANNING UPCOMING, YOU HAVE SOME DIFFERENT DESIGN OPTIONS AND FUNDING SOURCES TO FIGURE OUT.

IT DOES SEEM LIKE TO ME THAT, YOU KNOW, AS WE LOOK AT THIS IN THE CONTEXT OF A FIVE YEAR PLAN, YOU KNOW, DOING PERIODIC UPDATES, AND MAYBE IT'S IN YEAR THREE OR, YOU KNOW, EVERY

[01:50:08]

SO I THINK THAT'S THAT'S KIND OF HOW WE SEE A LOT OF COMMUNITIES DEAL WITH THIS, BECAUSE THERE'S ALWAYS A DEGREE OF UNCERTAINTY.

AND A LOT OF TIMES THESE PROJECTIONS DO NEED TO BE UPDATED AND CALIBRATED TO REFLECT, YOU KNOW, ACTUAL OCCURRENCES THAT HAPPEN THAT OFTENTIMES ARE DIFFERENT THAN PROJECTED TO MAKE SURE THAT YOU DON'T GET TOO FAR OFF COURSE AND HAVE TO HAVE LARGE CORRECTIVE TYPE CONVERSATIONS.

SO I THINK THAT'S ONE OF THE THINGS WE THOUGHT ABOUT IS MAYBE MAKING NOTE OF THAT, AS THAT'S GOING TO BE A REAL TRIGGER POINT TO MAYBE DO AN UPDATE IN THREE YEARS WHEN WE HAVE SOME CLARITY ON THE COST, THE TIMING, THE FUNDING SOURCES, TO SEE HOW MUCH OF THAT MAY COME BACK TO RATES WHEN YOU'VE HAD A CHANCE TO VET THAT THROUGHOUT THE COMMUNITY AND ALL THE STAKEHOLDERS.

SO COUNCIL MEMBER MATTHEWS AND THEN COMMISSIONER DILDAY.

THANK YOU. UM, SO THE IMPRESSION THAT I'VE.

GOTTEN OVER THIS FIRST THREE QUARTERS OF A YEAR THAT I'VE BEEN ON COUNCIL IS THAT THE WILDCAT PROJECT IS LIKE THAT'S LOOMING OUT THERE AS A REALLY DARK CLOUD THAT WE NEED TO GET SERIOUS ABOUT.

IS THAT CORRECT? I MEAN, THERE IS NOT ONE THAT WE CAN SHELVE FOR 20 YEARS.

THAT'S SOMETHING WE'VE GOT TO GET GOING.

RIGHT? UM, AND THEN TO THE COMMISSIONER GOODELL'S COMMENTS ABOUT SO MANY UNCERTAINTIES AND COSTS.

I'M JUST WONDERING.

LIKE THERE ARE GRANTS THAT WE'RE GOING TO GO AFTER THAT WE DON'T KNOW AND UNDERSTAND.

AND THE WISDOM OF PROJECTING, WELL, THIS IS THE RATE INCREASE THAT WE'RE GOING TO NEED TILL, YOU KNOW, THROUGHOUT 2033 TO DO WHAT WE PUT ON HERE.

BUT IT JUST. I GET UNCOMFORTABLE AND I WAS UNCOMFORTABLE WITH STORMWATER RATES ABOUT THIS BECAUSE THERE'S STILL SO MUCH UNCERTAINTY, NOT ONLY IN COST BUT IN FUNDING ALTERNATIVE FUNDING SOURCES.

IS DOES IT MAKE SENSE? OR THAT'S JUST NOT HOW GOVERNMENT WORK WORKS, IS TO PUT A REVIEW IN THREE YEARS TO SEE DO WE CONTINUE THE ESCALATION THAT'S APPROVED, OR DO WE HAVE TO MODIFY IT THREE YEARS? BECAUSE I'VE NEVER HEARD OF A GOVERNMENT ENTITY REDUCING RATES BACK DOWN.

ONCE THEY GET IT IN PLACE AND THEY'RE CHARGING IT, THEY JUST REPLACE IT WITH NEW PROJECTS BECAUSE IT'S ALREADY SET IN MOTION.

AND I WORRY ABOUT THE COST OF LIVING HERE, WHICH IS ALREADY VERY HIGH.

UM, AND THERE'S JUST SO MANY UNFUNDED PROJECTS OR PROJECTS THAT HAVE BEEN POSTPONED FOR YEARS AND YEARS.

IT JUST SEEMS LIKE BECAUSE OF THOSE UNCERTAINTIES AND FUNDING SOURCES AND UNCERTAINTY IN COST OF DELIVERING THESE PROJECTS, THAT A THREE YEAR TRIGGER TO REVIEW IT, TO SAY, OKAY, WE WERE ABLE TO GET THIS FUNDING, THESE OTHER PROJECTS CAME UP, MAYBE WE NEED TO INCREASE THE ESCALATION RATE SOMETHING.

BUT I JUST I DON'T FEEL COMFORTABLE JUST HAVING THIS TIMELINE OUT THERE, NOT KNOWING WHAT'S GOING TO HAPPEN IN BETWEEN ALL THOSE YEARS, BECAUSE PUTTING IT ON THE BACK OF THE RATEPAYERS, UM, YOU KNOW, IT JUST I, I'VE MENTIONED ON THE DAIS THAT HAVE A NONPROFIT THAT THIS, THIS SCHEDULE WILL PROBABLY PUT ME OUT OF BUSINESS, YOU KNOW, ON THE, ON THE FULLY FUNDED.

SORRY, I'M SUPPOSED TO CALL HIM BACK RIGHT NOW.

AND SO I KNOW OTHERS BUSINESS BUSINESSES, THIS COULD IMPACT THEM.

AND I WANT TO BE REALLY SENSITIVE TO THAT.

AND, YOU KNOW, THERE'S THERE'S A LOT OF ESPECIALLY OUR BUSINESS, OUR COMMERCIAL BUSINESSES IN TOWN.

THEY'VE CARRIED A HEAVY LOAD.

AND I JUST I JUST WANTED TO EXPRESS THAT, THAT THERE'S SO MUCH UNCERTAINTY THAT I FEEL LIKE WE SHOULD HAVE A TRIGGER IN THERE TO REVISIT INSTEAD OF JUST LETTING IT GO BLINDLY, IF ALL THINGS CONSIDERED.

THAT'S ALL I HAVE. AND THIS IS SOMETHING THAT WE COULD REVISIT.

YEAH. BY POLICY WE ARE SUPPOSED TO REVISIT EVERY THREE YEARS.

THAT'S JUST A GOOD UTILITY POLICY.

WE WILL HAVE A RATE MODEL FROM STANTEC THAT RICK AND OUR TEAM CAN USE TO, YOU KNOW, TO TRUE UP AND HELP INFORM.

GREAT. YEAH. WELL, I WAS JUST BROUGHT UP THE OTHER DAY, AND IT STILL BUGS ME.

[01:55:03]

I DON'T KNOW, COMPARED TO OTHER COMMUNITIES COMMUNITIES WE WERE COMPARING OURSELVES TO.

THE BIG BUNCH WEREN'T ALL EXACTLY IN MY MIND.

ONES WE SHOULD BE DOING.

WE SHOULD BE COMPARING OURSELVES TO THE VALLEY AND MAYBE OTHER PLACES UP HERE OR CLOSE.

UM, AND ARE WE PRICED RIGHT? MAYBE RESIDENTIAL SHOULD BE MORE THAN IT IS.

OR MAYBE AS YOU GO HIGHER WITH THE YOUTH, IT DOESN'T GET CHEAPER.

IT GETS MORE TO DISCOURAGE HIGHER USE.

SO I HAVEN'T SEEN ANYTHING ON THAT.

I'M SURE STAFF KNOWS IT, BUT I DON'T KNOW IT.

SO I JUST LAY THIS QUESTION OUT THERE.

THAT'S ALL, BECAUSE I THINK IT WOULD DRIVE OUR ABILITY TO PAY FOR THINGS IF WE GET MORE REVENUE.

BUT. AND I'M WONDERING, DO WE HAVE A TIERED SYSTEM FOR RECLAIMED WATER? NO. FOR THE RESIDENTIAL? YES. RECLAIMED.

RECLAIMED. YEAH.

RESIDENTIAL. RECLAIMED PAYS A PERCENTAGE OF WATER RATES WITH RESIDENTIAL.

PERIOD. THEY PAY THE SAME ON THEIR USE FOR FOR RESIDENTIAL WATER.

SO THEY'RE HIGH USER.

THEY'RE GOING TO PAY MORE FOR RECLAIMED THAN THOSE WHO DON'T DO THAT FOR COMMERCIAL.

NO. THAT'S COMPLEX.

BUT YOU'RE GOING TO LOOK AT THAT AS PART OF THE STUDY.

THAT'S RIGHT. AND SO WE COULD LOOK AT AT TEARING IT DIFFERENTLY FOR COMMERCIAL FOR WHEN WE GET UP TO.

BECAUSE A LOT OF THIS THAT WE'RE TALKING ABOUT IS CAPACITY FOR WASTEWATER.

RIGHT. SO IF WE WANTED TO WE COULD CHARGE MORE AT A CERTAIN LEVEL OF USE FOR RECLAIMED.

YOU CAN DO ANYTHING. WE'RE GOING TO LOOK AT YOUR RATES, I BELIEVE AS PART OF THE NEXT PHASE.

HOW DO NOW WE KNOW WHAT REVENUES.

WE'LL LOOK AT THAT AS AN OPTION I BELIEVE.

BUT IT'S REALLY HARD WITH THE BUSINESSES BECAUSE THERE'S SUCH A VARIETY OF USE FOR THE TYPE OF BUSINESSES, YOU KNOW, A DEPARTMENT STORE VERSUS A RESTAURANT.

BOTH COMMERCIAL AND NATURE HAVE DIFFERENT USES, DIFFERENT USE LEVELS.

SO HOW DO YOU BE EQUITABLE IN YOUR TIERED STRUCTURE? SO SIMPLE. AGAIN, ANOTHER OPTION FOR COMMERCIAL WOULD BE JUST AN OUTDOOR USE RATE VERSUS AN INDOOR ONLY IF THEY HAD A SEPARATE METER BECAUSE WE DON'T NECESSARILY METER ALL OUTDOOR USE OKAY.

ALL RIGHT I AM GOING TO TAKE PUBLIC COMMENTS IF WE'VE ASKED ALL OF OUR QUESTIONS.

SO LET'S START WITH THE HONORABLE WARD.

MOORE DAVIS I WAS ON THE WATER COMMISSION WHEN WE DID THE LAST STUDY.

SO I GOT AND REALLY GOT INTO SOME OF THESE PARTS, PARTICULARLY THE RECLAIMED.

THE 35% THAT WAS REFERENCED HAS BEEN THERE FOR A LONG, LONG TIME, AND IT WAS USED TO GET PEOPLE OFF OF POTABLE AND ONTO RECLAIMED. THERE'S NOTHING MAGIC ABOUT IT.

WE'VE CONSIDERED IT.

YOU KNOW, WATER IS BECOMING WATER.

SO WE REALLY THINK THAT THAT NUMBER WILL GO TO 35, 40, 45% OR 50%, AND PEOPLE AREN'T GOING TO JUMP OFF OF RECLAIMED AND GO TO POTABLE.

SO THAT'S ONE OF THE ISSUES YOU YOU CAN YOU CAN FIGHT OVER BECAUSE IT CAN GO UP.

THAT'S ALL. IS THERE ANY OTHER PUBLIC COMMENT? YEAH. UM, MY NAME IS HAROLD LOGAN.

GO TO YOU. I'M A STUDENT, UNDERGRAD, FRESHMAN MAJOR, PSYCHOLOGICAL SCIENCES.

UM, I DON'T REALLY HAVE A COMMENT OR QUESTION.

I HAVE BEEN TAKING NOTES SINCE THIS MEETING HAS STARTED, BUT IT HAS BEEN DODGY.

I WAS WONDERING IF I WOULD BE ABLE TO GIVE A POWERPOINT PRESENTATION THROUGH EMAIL, BUT IT WOULD BE AVAILABLE ONLINE.

AND PROVIDE YOU EVERYTHING ONCE WE GET ONCE I GET ALL FINAL DOCUMENTS, THEY'LL BE UPLOADED ONLINE.

SO WHERE YOU ARE ABLE TO FIND THE AGENDA FOR TODAY, ALL OF THE MATERIALS WILL BE IN AS PART OF THAT PACKET.

I WOULD JUST SAY GIVE ME A DAY OR TWO TO MAKE SURE I GET EVERYTHING THAT'S CURRENTLY BEEN PRESENTED.

THANK YOU. AND THANK YOU FOR BEING HERE.

YEAH. CAN I ASK A QUESTION THOUGH? OF COURSE YOU CAN. PUBLIC COMMENT.

I'M JUST CURIOUS AS TO WHY YOU CHOSE THIS, UM, THIS VARIOUS.

[02:00:02]

UM, I WAS REQUESTED BY MY TEACHER FOR INTRODUCTION TO CITY PLANNING AND COMPUTER.

PROFESSOR SEMATARY, UM, IS THE LAST LAST TO ATTEND A CITY COUNCIL MEETING, SPECIFICALLY ON TUESDAYS AT 3:00, WHICH DOES NOT FIT IN WITH OUR TIMEFRAME BECAUSE WOULD BE PSYCHOLOGY CLASS AT THAT TIME.

STUDYING PSYCHOLOGY AND COUNSELING.

YES. SO ONE THING I'VE BEEN LISTENING TO ALL OF THIS, LIKE THERE'S THIS KIND OF GOES BACK TO BEN'S COMMENTS TOO, IS.

YOU STRIP AWAY ALL THE INTRICACIES OF ALL THE LITTLE PROJECTS.

WE'RE MAJORLY UNFUNDED, RIGHT.

OR WE ARE WAY.

BEHIND THE CURVE ON WHERE WE SHOULD BE.

SO THERE'S WHETHER WHETHER YOU TAKE HALF OF THESE PROJECTS OR ALL OF THE PROJECTS, YOU HAVE A LITTLE VARIATION IN YOUR LINE, BUT STILL THE TREND IS THE SAME. RIGHT.

SO, UM, SO IT SEEMS AS THOUGH WE'VE GOTTEN REALLY BOGGED DOWN IN THE DETAILS AND NOT KIND OF KEEPING THE BIGGER PICTURE IN MIND AS.

WE GOT TO FIGURE OUT A DIFFERENT WAY TO KICK THIS RATE UP.

RIGHT. AND SO THAT'S THE TAKEAWAY IS THAT IT'S NOT IT'S NOT WHETHER THE RATE CHANGES, IT'S HOW MUCH THE RATE NEEDS TO CHANGE.

AND HOW MUCH OF THIS LIST ARE WE WILLING TO CUT OFF AS A CITY AND NOT DO AND TAKE THE RISK THAT MAYBE IT'LL LAST TEN YEARS LONGER THAN WE THINK IT WILL? AND SO THAT'S JUST KIND OF THAT'S A THAT'S A TOUGH THING TO WRESTLE WITH.

BUT YEAH, TO ME THAT OPENS UP THE DOOR FOR THE CAN OF WORMS OF EXAMINING THE CITY. I'M WILLING TO TAKE STAFF'S WORD FOR IT THAT THESE ARE THE PROJECTS WE NEED TO FUND, BUT PEOPLE ARE GOING TO ASK QUESTIONS ABOUT YOUR CIP PROJECTS.

THEY'LL GET DOWN IN THE WEEDS.

OF COURSE. I DON'T KNOW WHAT THE RUST THING IS, RUST TYPES, BUT I WASN'T ACTUALLY GOING TO ASK ABOUT THAT.

BUT DO WE NEED TO CONSIDER LOOKING AT THE CIP AND MAKING JUDGMENTS? NOT ME PERSONALLY, BUT STAFF TO SAY, HEY, THE RATE WOULD BE A LOT LESS, OR IT WOULD BE HALF THE INCREASE IF WE CUT THESE PROJECTS OFF BECAUSE THEY'RE NOT IMPORTANT. OR IS THIS KIND OF DISCUSSION HAS OCCURRED, I THINK, THROUGHOUT TIME.

RIGHT. IT'S LIKE HALF YOUR PROJECTS, WHICH ONES WOULD THEY BE? AND I'M NOT SAYING WE GO THERE, BUT YOU KIND OF BROUGHT IT UP AND I THINK THE PUBLIC MIGHT WANT TO GO THERE.

HOW MANY OF THESE PROJECTS ARE THESE REALLY ALL THAT IMPORTANT? CAN'T YOU CUT SOME OF THEM? GIVE US A BREAK.

I DON'T KNOW, I JUST THROW THAT OUT THERE TOO, BECAUSE YOU KIND OF.

YEAH, I'M THINKING THE SAME WAY.

HARRIS. WELL, THEY KIND OF SAID THAT WHEN YOU TALKED ABOUT THE THE PARK, THE HOW YOU'RE LOOPING THAT PART, YOU KNOW WHAT I'M SAYING? OKAY. THAT BECAUSE YOU SAID THAT IF WE DIDN'T DO THAT, EVERYBODY WOULD STILL GET WATER, RIGHT? IT JUST MAKES IT MORE EFFICIENT.

IS THAT KIND OF WHAT OPERATIONAL EFFICIENCY IS? OPERATIONAL EFFICIENCY.

SO WE WOULD SAY TIME, MONEY, STAFF, WHAT WOULD WE SAY IN THE OPERATIONAL EFFICIENCY IF WE DID THAT, YOU WOULD SAVE MONEY AND YOU WOULD SAVE WATER.

WATER, WATER IS MONEY.

SO WE WOULD HAVE TO FIGURE OUT WHICH WHICH PROJECTS.

DEFINITELY. WE DID NOT HAVE TO DO BECAUSE THERE WOULD BE, YOU KNOW, IT'S KIND OF LIKE WHEN YOUR KIDS WANT THEIR NEEDS AND WANTS ARE CONFUSED. YOU NEED THIS, BUT YOU WANT THIS.

SO I'M NOT SAYING THAT OUR NEEDS AND WANTS ARE CONFUSED OR WE'RE KIDS, BUT I'M JUST TRYING TO THINK, YOU KNOW, BECAUSE YOU'RE RIGHT.

YOU KNOW, MAYBE WE DON'T NEED ALL OF THESE.

I THINK PEOPLE ARE GOING TO ASK THE QUESTION, I DON'T KNOW, BUT THAT'S KIND OF LIKE A TAILSPIN GOING BACKWARDS.

I DON'T KNOW HOW YOU DO THAT.

I GUESS I WANT TO SUGGEST TO GO DOWN THAT ROAD TOO MUCH.

BUT WHAT I'M SAYING IS THAT THERE'S A LOT OF STUFF ON HERE.

[02:05:03]

THE QUESTION YOU HAVE TO ANSWER.

THAT'S TRUE. SO YEAH, SO THAT'S VICE MAYOR.

THANK YOU, MADAM MAYOR.

GOOD AFTERNOON, EVERYBODY.

UM. THIS IS SUCH A GREAT MEETING OF THE MINDS, AND I'M SO GRATEFUL TO OUR WATER COMMISSIONERS.

I'M GRATEFUL TO EACH OF YOU AS INDIVIDUALS, FOR GIVING YOUR TIME AND TALENT TO THE CAUSE OF WATER, WATER CONSERVATION, AND JUST OUR DELIVERY AND EVERYTHING THAT GOES INTO WHAT WE DO.

UH, VERY GRATEFUL.

UM, SO I DON'T KNOW IF WE'RE MAKING ANY FIRM DECISIONS TODAY, BUT THIS IS A PUBLIC MEETING.

I'M HAPPY TO TELEGRAPH SOME THOUGHTS TO YOU ALL.

I THINK THERE'S PLENTY OF ROOM LEFT FOR DISCUSSION AS WE MOVE FORWARD, AND I AM BY NO MEANS SUGGESTING THAT WHAT I'M THINKING AND FEELING RIGHT NOW IS, IS GOING TO REPRESENT HOW, YOU KNOW, A LOT OF THIS IS GOING TO COME DOWN TO UP OR DOWN VOTES AT THE END OF THE DAY, AND I WOULDN'T WANT TO. CORNER MYSELF INTO ANY ANYTHING.

BUT I DO HAVE SOME BIGGER THOUGHTS ON ON THIS DISCUSSION.

THE FIRST ONE, I'LL KIND OF WORK BACKWARDS BECAUSE WE JUST HAD SOME COMMENTS ABOUT WHETHER OR NOT THE THE ITEMS ON THIS LIST ARE TRULY ESSENTIAL.

I DON'T THINK IT'S HELPFUL FOR US TO GET INTO A CONVERSATION LIKE THAT.

I FIRMLY TRUST OUR CITY STAFF TO HAVE ALREADY HAD THOSE DIFFICULT CONVERSATIONS MANY TIMES, AND WE'RE ALREADY LATE TO THE GAME ON ALL OF THIS.

IF THEY SAY IF, IF, IF THERE'S A PROJECT ON THAT LIST, THEN THE VETTING PROCESS FOR WHETHER OR NOT IT SHOULD BE ON THAT LIST HAS ALREADY OCCURRED.

I'M CERTAINLY NOT GOING TO INSERT MYSELF AND MICROMANAGE THAT LEVEL OF AND AND, UM, YOU KNOW, SECOND GUESS, THE BRAIN TRUST OF INCREDIBLE WATER TALENT THAT WE HAVE ON OUR STAFF.

UH, AND SO ONE OF THE OTHER POINTS I WANT TO MAKE IS WE'RE TALKING ABOUT WATER HERE.

I MEAN, I JUST I JUST WANT TO STAY BIG AND THINK ABOUT THESE THINGS FROM THE PERSPECTIVE OF OUR CITIZENRY.

FROM THE SIDE OF YOU.

WAKE UP ONE MORNING AND YOU GO TO TURN ON THE TAP AND THE WATER DOESN'T COME OUT.

I MEAN, THIS IS A WORST CASE SCENARIO, BUT IT'S IN THE BALLPARK OF WHAT WE'RE TALKING ABOUT.

THE THE VERY BASIC IF IF YOU WERE TO DO A SURVEY AND ASK ANYBODY ON THE STREET, WHAT IS THE ONE THING YOU EXPECT YOUR MUNICIPAL MUNICIPAL GOVERNMENT TO DO? I BET THERE'S ONE OF TWO ANSWERS.

THE FIRST WOULD BE PUBLIC SAFETY OR THE FIRST MIGHT BE CLEAN WATER.

I GET CLEAN WATER DELIVERED TO MY HOUSE EVERY DAY, EVERY MINUTE, EVERY TIME I GO TO TURN ON THE TAP, EVERY TIME I GO TO USE THE BATHROOM.

AND SO WHAT WE'RE GENERALLY TALKING ABOUT IS THE MOST ESSENTIAL AND CRITICAL FUNCTION WE HAVE AS A CITY.

AND WHAT I'M HEARING FROM THESE DISCUSSIONS THAT WE'VE HAD TODAY.

AND ALSO, EXCUSE ME LAST WEEK, IS THAT THERE'S SOME FIVE ALARM FIRE BELLS GOING OFF ABOUT WHETHER OR NOT WE CAN CONTINUE TO DO THE ONE MOST BASIC THING THAT THE PUBLIC EXPECTS OF US.

AND WE'RE.

HIDING THAT.

UH, BY DEFERRING IT INTO THE FUTURE AS AS IN TERMS OF WHEN THE FINAL CRISIS EMERGES AND EVINCES ITSELF.

UM, SO I JUST, I DON'T WHEN WE'RE TACKLING THIS PERSONALLY, I DON'T WANT TO PUSSYFOOT AROUND WHAT'S NEEDED, WHAT'S EXPECTED, AND WHAT WE'VE GOT TO DO. I THINK EVEN AT THE MINIMUM, THIS IS A VERY DIFFICULT CONVERSATION IN TERMS OF THE TAX BURDEN, RATEPAYERS AND THE COST OF LIVING.

UH, BUT I'M FINDING MYSELF FAIRLY SUPPORTIVE OF GOING ALL IN AND FUNDING THIS FULLY AS MUCH AS WE CAN, WITH THE PROMISE TO ACTUALLY REVISIT THIS LATER IF WE'RE FINDING WE'RE GETTING A LITTLE BIT OF A CUSHION.

UH, I, I, I AGREE WITH COUNCIL MEMBER MATTHEWS THAT GOVERNMENTS DON'T TEND TO REDUCE RATES, BUT THAT COULD BE A BARGAINING CHIP THAT WE USE TO OUR FAVOR IN THESE DISCUSSIONS.

AND ALSO IN TERMS OF, YOU KNOW, HOW THIS HOW WE NEGOTIATE THIS WITH THE PUBLIC OVER TIME.

I THINK IT'S IMPORTANT TO KEEP IN MIND THAT IF, IF, IF WE START SMALL, PEOPLE ARE GOING TO BE VERY UPSET IF WE HAVE TO GO BIG.

[02:10:03]

I BELIEVE THERE SHOULD BE SOLID SUPPORT FOR GOING ALL IN ON THIS, AND THAT'S WHAT WE SHOULD BE TELLING THE PUBLIC.

AND WHEN THEY START SEEING HOW DIFFICULT THAT'S GOING TO BE, MAYBE WE CAN LEAN OFF OF IT A LITTLE BIT.

MAYBE WE CAN FIND SOME OF THOSE PROJECTS THAT REALLY CAN BE WAITED UPON.

UM, AND GET TO A LESSER NUMBER.

BUT THAT'S THE DIRECTION WE SHOULD BE NEGOTIATING IN, ESPECIALLY HERE AT THE BEGINNING.

UH. SO THAT'S A LOT.

THINK THERE WAS 1 OR 2 OTHER POINTS I WANTED TO MAKE? UM. OH, YEAH.

YOU KNOW, UH, WARD TALKED ABOUT WATER AS WATER.

I DEFINITELY WANT EVERYBODY TO KNOW THAT THAT IS CLEARLY THE WAY I THINK ABOUT THIS AND THE WAY I WILL BE, UH, THAT WILL LEAN HEAVILY INTO MY DECISION MAKING.

UM, AND ALSO, YOU KNOW, WHEN WE'RE TALKING ABOUT TECHNOLOGIES AND INNOVATIONS AND, UM, OUR WATER SERVICES, I DON'T WANT TO JUST BE IN A RUBRIC OR A PARADIGM OF MAINTENANCE.

I THINK WE NEED TO BE UPGRADING, AND WE NEED TO BE INNOVATING, AND WE NEED TO BE EMBRACING AND ADOPTING THE LATEST TECHNOLOGIES.

AND, UH, THAT'S ANOTHER REASON WHY I THINK GOING ALL IN JUST BUYS US THE MOST AMOUNT OF LEVERAGE.

AND THEN FINALLY WHAT? OH, SHOOT.

IT WAS RIGHT THERE. AND THEN I LOST IT AGAIN.

UH, WELL, I THINK THAT'S PLENTY TO CONSIDER FOR RIGHT NOW.

JUST THE WAY SOME OF THE WAYS IN WHICH I'M THINKING ABOUT THIS.

BUT COUNCIL, I THINK IT'S I, I, I FEEL STRONGLY, INSTINCTIVELY THAT FROM A POLITICAL STANDPOINT AND FROM DOING THE RIGHT THING, WE NEED TO BE EXPRESSING TO THE PUBLIC THAT THIS IS A CRISIS.

THIS IS THE MOST BASIC THING THEY EXPECT US TO DELIVER, AND WE'RE REALLY TROUBLED BY THE VERY DIFFICULT DECISIONS WE HAVE TO MAKE.

BUT HERE WE ARE, AND THIS IS WHAT WE NEED TO DO.

UM, AND THEN AND THEN THE LAST POINT, WHICH I DO REMEMBER NOW, IS JUST THAT HOW THINGS GET MORE EXPENSIVE IF WE WAIT ON THEM.

UM, REALLY, THE FISCAL RESPONSIBLE THING TO DO IS TO GO ALL IN RIGHT NOW, PAY FOR AS MUCH AS WE CAN AT THIS TIME, AND SET OURSELVES UP ON VERY, VERY GOOD FOOTING FOR INNOVATIONS AND UPGRADES AND NEW TECHNOLOGIES AS THE FUTURE PRESENTS ITSELF.

THANK YOU. COUNCIL MEMBER MATTHEWS.

THANK YOU. IN CALCULATING THESE RATES AND ESTIMATING WHAT WE HAVE TO COLLECT TO THEN PAY FOR THESE PROJECTS, WE HAVE, WE'RE WE'RE A SECOND HOME CITY IN A LOT OF REGARDS.

AND RIGHT NOW WE DON'T HAVE WE'RE BASING IT OUR WATER USAGE AT LEAST ON USAGE AS OPPOSED TO BASE. HAVE WE LOOKED AT I MEAN WE'VE GOT A LOT OF HOUSING DEVELOPMENT GOING ON ON ON BUTLER AND OVER OFF WOODY MOUNTAIN AND STUFF.

AND SO THAT WILL ADD TO THE RATEPAYERS BUT THEN ALSO ADD TO THE USAGE.

BUT I'M JUST WONDERING IF BECAUSE WE ARE A SECOND HOME TOWN AND WE'VE GOT PINE CANYON WHO'S NOW DESERTED PRETTY MUCH FOR HALF OF THE YEAR.

UM. I'M WONDERING, HAVE WE LOOKED AT, WELL, IF WE DID A BASE INSTEAD OF USAGE, LIKE PUT THAT PERCENTAGE MORE TO WHERE IT'S FLATTER AND NOT PUT SO MUCH ON THE USAGE, WOULD THAT HELP US GET THERE AND MAKE IT MORE EQUITABLE FOR US THAT LIVE HERE FULL TIME, THAT ARE PAYING FOR ALL THIS? BECAUSE THERE ARE POCKETS IN OUR COMMUNITY THAT DON'T, YOU KNOW, ARE JUST PAYING THE BASE RATE BECAUSE THEY TURN THEIR WATER OFF IN THE IN THE WINTER TIME. SO I'M JUST WONDERING, CAN I ADD SOMETHING TO THAT? YEAH. CAN WE CHARGE? I'M ALWAYS TOLD NO IN TERMS OF TAXES.

AND I GET IT. CAN WE CHARGE A DIFFERENT BASE RATE FOR A HOME THAT'S LIVED IN FULL TIME VERSUS ONE THAT'S EITHER RENTED OUT AS A SHORT TERM RENTAL OR AS A SECOND HOME? LET'S SEE. I DON'T KNOW IF WE CAN JUSTIFY IT, BUT SOMETHING TO LOOK AT, I DON'T KNOW.

SO MAYOR AND COUNCIL MEMBER MATTHEWS, WE ARE WE'RE GETTING TO THAT PHASE.

THAT'S WHY WE WANTED TO GET YOUR DIRECTION TODAY SO THAT WE CAN MOVE FORWARD TO THAT.

BUT WE'RE LOOKING AT SHORT TERM RENTALS FOR ANOTHER COMMUNITY, ACTUALLY, PAGOSA AREA WATER AND SAND DISTRICT IN COLORADO.

JUST SO IT'S INTERESTING THAT YOU BRING THAT UP, BECAUSE THESE SHORT TERM RENTALS HAVE A BIGGER IMPACT IN THE WINTER ON THE AS A SKI AREA.

[02:15:09]

WE ARE GOING TO LOOK AT EVERYTHING.

WE'LL LOOK AT HOW MUCH REVENUE TO RECOVER FROM THAT BASE CHARGE VERSUS THE VOLUME OR USAGE CHARGE.

WE'LL LOOK AT DIFFERENT RATE STRUCTURES.

THERE ARE DIFFERENT REASONS WHY YOU WOULD SELECT A DIFFERENT RATE STRUCTURE.

IT'S ALL GOING TO BE BASED ON THE COST OF SERVICE AS WELL.

SO SOME COMMUNITIES HAVE STANDBY CHARGES THAT EVEN IF YOU ARE NOT OCCUPYING YOUR HOME, YOU STILL COULD SHOW UP AT ANY MOMENT.

EXPECT TO TURN THAT TAP ON, YOU KNOW, AND EXPECT TO HAVE SERVICE.

SO THERE ARE THEY COME UP.

THERE'S A BUNCH OF DIFFERENT WAYS WE CAN LOOK AT THOSE TYPES OF, YOU KNOW, I THINK ON EQUITY, YOU KNOW, YOU HAVE PEOPLE THAT ARE IN OLDER NEIGHBORHOODS THAT LIVE HERE, YOU KNOW, USAGE, AND THEN YOU HAVE PEOPLE THAT YOU KNOW, ARE TURNING OFF THEIR WATER FOR MONTHS AT A TIME. AND WE WHEN YOU JUST LOOK AT THE REVENUES THAT WE'RE GATHERING NOW ON THE RATES, THAT COULD REALLY IF WE CHANGE THAT PERCENTAGE, THAT COULD HELP MAKE IT MORE EQUITABLE TO THE PEOPLE WHO, YOU KNOW, USE IT ALL THE TIME THAT LIVE UP HERE AND NOT HAVE TO CARRY THAT BURDEN BECAUSE WE'RE PROVIDING THAT SERVICE TO EVERYBODY.

RIGHT. DOES THAT MAKE SENSE? YES IT DOES. WE WILL WE'LL MAKE SURE WE PUT THAT INTO THE PRICING CONSIDERATIONS.

THANK YOU, CITY MANAGER.

YEAH, JUST A VERY QUICK CAVEAT ON THAT.

I KNOW IT'S JUST A DISCUSSION, BUT I THINK THE FACTOR HERE IN FLAGSTAFF IS PROBABLY MORE ON THE SECOND HOME OWNERSHIP RATHER THAN SHORT TERM RENTAL. I THINK THEY'RE BOTH WORTHY OF DISCUSSION.

BUT HAVING JUST GONE THROUGH OUR SHORT TERM RENTAL ORDINANCE AND LOOKING AT A LOT OF DATA, WHICH WE'VE HAD, IS SURPRISINGLY A PRETTY SMALL COMPONENT OF OUR HOUSING COMPOSITION, LIKE, I THINK UNDER 2% OR SOMEWHERE IN THAT BALLPARK.

SECOND HOME OWNERSHIP.

I HAVEN'T SEEN THOSE NUMBERS.

SO THIS IS ENTIRELY ANECDOTAL, BUT I THINK IT'S GOING TO IT'S GOING TO BE SIGNIFICANT.

AND I THINK THIS DISCUSSION OF, YOU KNOW, SHOULD THERE BE SOME SORT OF VACANCY RATE THAT IS CHARGED FOR SECOND HOME OWNERSHIP THAT TURNS OFF THIS WATER FOR TIMES OF THE YEAR, I THINK IS A COULD BE A VERY RELEVANT DISCUSSION.

THANKS. AND I'M GOING TO OPEN IT UP TO PUBLIC COMMENT AGAIN.

READY TO GET IT. ARE YOU GETTING FROM US WHAT WHAT YOU WERE LOOKING FOR? I THINK IT WOULD BE HELPFUL TO HEAR FROM A COUPLE MORE COUNCIL MEMBERS IF WE SHOULD PROCEED, HOW WE SHOULD PROCEED WITH WHAT LEVEL OF INVESTMENT? OKAY. WHAT DO YOU THINK? YOU SEE IT BACK UP ON THE SCREEN.

SO. YES.

OKAY. WE'VE LOST OUR WATER COMMISSION FORM.

SO WHAT DOES THAT ONE, TWO THREE, FOUR.

SO WE STILL HAVE FOUR. YES.

OKAY. DON'T LEAVE.

I'LL. SORRY.

OKAY. OKAY.

SO. SO BEFORE WE DO THAT.

WARD, I JUST WANTED TO REMIND PEOPLE OF WHAT HAPPENED LAST TIME BECAUSE IT SORT OF INFORMS THIS TIME.

SO THE LAST STUDY, THERE WERE TWO OPTIONS.

ONE WAS 3% INCREASE, ONE WAS SEVEN.

THEY 3% WAS PUSHED HARD.

BUT IT DID SOME REALLY BAD THINGS AND WE ENDED UP WITH 4.3%.

UM, THE SEVEN WOULD HAVE BEEN FUND EVERYTHING AND DO IT RIGHT THEN.

WE ARE TWO YEARS LATE SO WE HAVEN'T HAD THE INCREASES OF 7%.

WE'VE ONLY HAD THREE.

SO THAT'S WHY WE'RE HERE OKAY.

THANK YOU. AND STERLING.

THANK YOU, MAYOR, AND THANK YOU ALL MEMBERS OF THE COUNCIL AND THE COMMISSION.

I'M GLAD WE DO STILL HAVE A QUORUM OF THE COMMISSION.

I JUST WANTED TO COMMENT.

AND CITY MANAGER CLIFTON, YOU BROUGHT UP THE VACANCY RATE FOR THOSE THAT ARE ONLY IN THE COMMUNITY PART OF THE TIME.

THAT IS SOMETHING THAT HAS COME UP BEFORE.

IF THAT'S FORMAL DIRECTION, I DID WANT TO INDICATE THAT THERE'S SOME LEGAL RESEARCH THAT WILL NEED TO BE DONE ON THAT AS WELL.

I UNDERSTAND THERE ARE SOME COMMUNITIES THAT HAVE DONE IT, AND THERE ARE SOME JUST SOME EYES THAT WOULD LIKE TO DOT TS THAT I'D LIKE TO CROSS TO MAKE SURE THAT WE'RE GOING TO BE OKAY TO DO THAT, IF THAT IS DIRECTION THAT WE RECEIVE.

[02:20:02]

I THINK THAT THAT'S CRUCIAL AND MOVING FORWARD.

AND THEN I THINK YOU OUGHT TO THINK ABOUT UTILIZING SOME OF THE ASSETS THAT YOU OWN FOR, FOR LONG TERM LEASES THAT COULD RECOVER SOME CASH THAT YOU COULD THEN PUT AGAINST WHAT YOU HAVE TO EXPEND.

PARTICULARLY I'M TALKING ABOUT REDCAP AND THE POSSIBILITIES THAT EXIST THERE.

BUT THERE ARE OTHER ASSETS THAT YOU CONTROL AS WELL.

AND AS AS PAINFUL AS IT'S LOOKING TO BE, I TOO WOULD PREFER THAT WE GET DONE WHAT WE NEED TO GET DONE AND AND STOP FALLING BEHIND IN OUR CAPITAL PROJECTS.

AND IT IS GOING TO BE PAINFUL.

COUNCIL MEMBER SWEET I AGREE, I LIKE THAT YOU ALL WORKED OUT THE ALTERNATIVE OPTION, AND I DO THINK WE NEED TO TAKE THE BULL BY THE HORN AND GET THIS DONE.

SO COUNCIL MEMBER HOUSE.

THANK YOU. I'LL JUST SHARE THAT I AM IN AGREEMENT WITH THAT AS WELL.

I DO WANT TO PUT FORWARD AGAIN.

I THINK IT WAS. COUNCIL MEMBER MATTHEWS BROUGHT UP THE QUESTION OF OF JUST CONTINUOUSLY EXAMINING AND MAKING SURE THAT WE ARE CONSIDERING EQUITY AND EQUITABILITY REALLY IN THESE CONSIDERATIONS.

I THINK, ALONG WITH LOOKING AT PART TIME RESIDENCY AND SECOND HOME OWNERSHIP, ONE OF THE OTHER PARTS OF THAT EQUITY QUESTION IS GOING TO BE EXAMINING THE IMPACTS TO SOME OF THE OLDER NEIGHBORHOODS THAT I THINK DID COME UP IN COUNCIL MEMBER MATTHEWS.

THAT MIGHT HAVE BEEN YOU THAT THAT BROUGHT THAT UP.

UM, BUT JUST CONSIDERING THE INFRASTRUCTURE OF SOME OF THE OLDER NEIGHBORHOODS OF OUR COMMUNITY, WHERE THEY ARE GOING TO BE MORE LIKELY TO HAVE, YOU KNOW, LEAKY PIPES OR OTHER THINGS THAT ARE GOING TO DRIVE THEIR COSTS HIGHER AT NO FAULT OF THEIR OWN.

UM, BUT THOSE ARE GOING TO BE THINGS THAT WE HAVE TO TO THINK ABOUT.

AND SOME OF THE FEEDBACK THAT I WOULD ANTICIPATE HEARING FROM COMMUNITY MEMBERS, PARTICULARLY IN THOSE NEIGHBORHOODS, IS AS WE'RE STRIVING FOR THAT EQUITABLE APPROACH, THERE ARE GOING TO BE SOME OF THOSE SORTS OF FACTORS TO CONSIDER.

AS AS TOUGH AS IT IS TO TAKE ALL OF THAT SORT OF THING INTO CONSIDERATION, I THINK THAT IT BEHOOVES US TO AT LEAST ACKNOWLEDGE IT AND PUT IT OUT THERE AS A CONSIDERATION SO THAT FOLKS KNOW, YOU KNOW, WE'RE NOT OVERLOOKING SOME OF THOSE TRADITIONALLY OVERLOOKED NEIGHBORHOODS OR POPULACES.

WE DID THINK ABOUT IT, AND WE MIGHT NOT BE ABLE TO COME UP WITH A FULLY EQUITABLE SOLUTION FOR SOME OF THOSE CHALLENGES THAT ARE BEYOND THEIR CONTROL AND BEYOND OURS, BUT AT LEAST IT'S PART OF THE CONSIDERATION.

AND ALSO FOR EQUITY REASONS TOO.

I WOULD I WOULD PREFER TO SEE US PUT MORE OF THE BURDEN ON USAGE RATHER THAN BASE.

AND IT'S ANOTHER WAY TO SUPPORT CONSERVATION.

COUNCIL MEMBER MATTHEWS.

THANK YOU. I JUST WANT TO REITERATE, I GUESS THERE'S TWO DIFFERENT WAYS TO LOOK AT THAT.

AGAIN, GOING BACK TO THE SECOND HOME SCENARIO, THEY'RE GOING TO PAY VERY LITTLE FOR SIX MONTHS OUT OF THE YEAR.

SO I'D LIKE TO KIND OF SEE HOW THAT PLAYS OUT, IF THAT IS IN YOUR STUDY TO SAY, WELL, IF THE BASE INCREASED X STILL NOT MAYBE OVER WHAT OUR LOWER INCOME FAMILIES, YOU KNOW, NOT PUTTING THEM OUT OF THE MARKET, BUT JUST BRINGING THE SECOND HOME HOMEOWNERS INTO MORE OF A PARTICIPATION IN THESE COST.

I KNOW IT DOESN'T MATTER TODAY, BUT I'M I'M FRUSTRATED THAT HERE WE ARE AGAIN HAVING TO MAKE UP FOR DEFERRED PROJECTS.

AND NOW WE'RE AT A CRITICAL POINT AGAIN, JUST LIKE STORMWATER.

AND IT'S US THAT'S GOING TO HAVE TO, YOU KNOW, I JUST WORRY ABOUT THE ECONOMY, ABOUT THE BUSINESSES, THE USAGE AND WHAT'S GOING TO BE THE LONG TERM EFFECT OF WHEN THE STORMWATER RATES GO UP AND THESE WATER RATES GO UP ON SOME OF OUR BIGGER BUSINESSES.

[02:25:09]

AND I THINK THAT THAT'S CRITICAL BECAUSE THEN THAT JUST ALL COMES BACK DOWN TO US, RIGHT? IF WE DON'T HAVE JOBS AND WE DON'T HAVE THIS.

AND SO I DON'T THINK IT'S THIS IS A HARD DISCUSSION AND I UNDERSTAND I DON'T WANT TO DEFER ANYTHING, BUT I'M JUST REALLY I'M JUST NOT HAPPY WITH WHERE WE ARE RIGHT NOW, BUT I DO I WOULD LIKE TO SEE HOW IT IMPACTS THE DIFFERENT BUSINESSES AND CONSUMERS RESIDENTIAL.

AND JUST REALLY HAVE A CLEAR IDEA OF HOW WE CAN GET TO THE SAME GOAL, BUT IN DIFFERENT SCENARIOS.

AND THAT'S GOING TO BE REALLY IMPORTANT FOR ME.

AND REGARDING THE BASE, IF THERE IS A WAY THAT THAT SECOND HOMES CAN HAVE A DIFFERENT RATE OR OR HOMES THAT AREN'T LIVED IN YEAR ROUND CAN HAVE A DIFFERENT RATE, I THINK THAT'S WHERE WE CAN MAKE IT UP IF IT'S LEGAL.

AND LIKE IF THEY DON'T USE X AMOUNT OF YEAR, THEN THEY GO TO THE BASE RATE AS OPPOSED TO SOMEBODY THAT USAGE MAYBE HAS TO GET THEIR SHIPMENTS OR WE CAN LOOK INTO IT.

EVERYTHING THAT'S. ALL RIGHT.

ARE THERE ANY MAY ASK CLARIFYING QUESTION.

YES PLEASE. WOULD WE BE LOOKING AT THE ALTERNATIVE OPTION FOR WATER WASTEWATER AND RECLAIMED.

IS THAT THE OKAY.

ALL RIGHT. THANK YOU. YES.

UM. OKAY.

SO WE'VE GIVEN DIRECTION.

WE FEEL GOOD. THIS MEETING IS ADJOURNED.

DID YOU WANT THE COMMISSION TO VOTE ON SOMETHING? CITY COUNCIL HEARING.

* This transcript was compiled from uncorrected Closed Captioning.