[00:00:27]
WELCOME TO THE CITY COUNCIL B SESSION OF OCTOBER THE 18TH, 2017.
COUNCIL MEMBER BROCK HOUSE COUNCIL MEMBER SANDOVAL.
COUNCIL MEMBER COURAGE PRESENT.
WELCOME EVERYONE TO OUR CITY COUNCIL B SESSION.
[1. A Briefing from the San Antonio Water System (SAWS) on proposed rate adjustments for 2018 and 2019, followed by a briefing by City Staff on the proposed adjustments. [Robert R. Puente, SAWS President & CEO; Ben Gorzell, Chief Financial Officer, City of San Antonio]]
FROM SAS ON THE YES, MAYOR, WE DO.AND THIS IS A PRESENTATION ON A REQUEST FROM THE SAN ANTONIO WATER SYSTEM TO INCREASE THEIR RATES AND CHARGES AND SAWS IS PROPOSING A 5.8% INCREASE FOR 2018 AND A 4.7% INCREASE FOR 2019.
AS THE OWNERS OF SAWS, THE CITY HAS THE AUTHORITY TO APPROVE CHANGES TO THEIR RATES.
AND UNDER THE CITY CHARTER, UH, CITY STAFF HAS A RESPONSIBILITY TO REVIEW THE RATE REQUESTS AND MAKE RECOMMENDATIONS TO THE CITY COUNCIL.
SO TODAY'S PRESENTATION WILL BE FROM, UH, CITY STAFF AS WELL AS FROM THE SAN ANTONIO WATER SYSTEM STAFF AND ROBERT PUENTE.
THE C E O IS HERE THIS AFTERNOON.
OUR CITY'S, UH, CHIEF FINANCIAL OFFICER WILL PROVIDE SOME BACKGROUND INFORMATION ON THE CITY AND THE SAS RESPONSIBILITIES FOR THE BENEFIT OF OUR NEW COUNCIL MEMBERS.
AND THEN ROBERT PUENTE, SASS PRESIDENT AND C E O WILL BEGIN THE SAS PRESENTATION AND TALK ABOUT HOW THEY DEVELOP THEIR BUSINESS CASE.
BEN WILL THEN WRAP UP WITH AN OVERVIEW OF THE STAFF'S COMPREHENSIVE REVIEW OF THE PROPOSALS FROM THE SAS STAFF.
SO TODAY'S ITEM IS ONLY A BRIEFING AND CONSIDERATION OF THE PROPOSED RATE INCREASES ARE CURRENTLY SCHEDULED FOR NOVEMBER 9TH.
SO WE'LL HAVE TIME BETWEEN TODAY AND COUNCIL ACTION TO ANSWER ANY OTHER QUESTIONS OR PROVIDE ADDITIONAL BRIEFINGS IF THE COUNCIL WOULD LIKE THAT.
SO LET'S BEGIN IN BEN GOEL, THE CITY'S CHIEF FINANCIAL OFFICER, WILL GIVE SOME BACKGROUND AS WELL AS THE CITY'S ANALYSIS OF THE RATE RECOMMENDATIONS.
I'LL TURN IT OVER TO BEN GOEL.
GOOD AFTERNOON, MAYOR AND COUNCIL MEMBERS.
AS, UH, THE CITY MANAGER MENTIONED, I'M JUST GONNA GIVE YOU A VERY BRIEF, BRIEF OVERVIEW OF SAWS AND ITS CREATION.
A LITTLE BIT OF THE OWNERSHIP STRUCTURE.
I CAN GET THE SLIDE PRESENTATION UP.
1992 WAS A CONSOLIDATION OF THE CITY'S WASTEWATER DEPARTMENT, ALONG WITH, UH, BACK THEN WAS CALLED THE CITY WATER BOARD AND THE ALAMO WATER CONSERVATION AND REUSE DISTRICT.
THAT WAS DONE THROUGH A LARGE REFINANCING OF ALL OF THE DEBT OF THESE ENTITIES INTO ONE ORGANIZATION, AND THAT ULTIMATELY CREATED SAWS.
THERE'S A BOARD OF TRUSTEES IN PLACE UNDER THAT INDENTURE SEVEN MEMBER BOARD OF TRUSTEES.
THOSE MEMBERS ARE APPOINTED FOR FOUR YEAR STAGGERED TERMS AND OUR MAYOR SERVES AS AN EX OFFICIO VOTING MEMBER ON THAT BOARD.
I MENTIONED THE BOND REFINANCING.
WHEN YOU LOOK AT SAWS MANY TIMES WE GET ASKED, WHAT, WHAT ARE THE ARTICLES OF INCORPORATION OF THE BYLAWS? IT'S REALLY THE BOND INDENTURE THAT CREATED SAWS AND REALLY SETS OUT BETWEEN THE STATUTE AND THE INDENTURE KIND OF ROLES AND RESPONSIBILITIES.
THE BOARD OF TRUSTEES FOR SAWS HAS, THEY ARE VESTED WITH, UH, THE MANAGEMENT AND CONTROL OF THE SYSTEM.
THEY BASICALLY OVERSEE THE SYSTEM, THE OPERATIONS AND MAINTENANCE OF THE SYSTEMS, EVERYTHING THAT GOES ALONG WITH THAT.
AND THEN THEY'RE AUTHORIZED TO MAKE IMPROVEMENTS TO THE SYSTEM, ADDITIONS TO THE SYSTEM, UM, AS WELL AS TAKE CARE OF THE CAPITAL NEEDS OF THE SYSTEM.
AS THE OWNERS OF C P S THROUGH YOU ALL, AS THE CITY COUNCIL, WE RETAINED AUTHORITY OVER THE APPROVAL OF RATES AND CHARGES.
YOU APPROVE THE AUTHORIZATION OF ANY DEBT ISSUANCES FOR THE UTILITY, UH, THE APPROVAL OVER INVERSE CONDEMNATION ACTIONS, AND THEN THE APPOINTMENT OF BOARD MEMBERS.
THIS SLIDE JUST SUMMARIZES OFTEN CALLED A FLOW OF FUNDS OR SOME PEOPLE WILL REFER TO IT AS A WATERFALL.
IT'S RIGHT OUT OF THE BOND INDENTURE.
THIS IS JUST SOME BACKGROUND INFORMATION ON HOW THE REVENUES OF SAWS HAVE TO BE APPLIED PURSUANT TO THAT INDENTURE, UM, DOLLARS THAT COME INTO THE SYSTEM FIRST HAVE TO BE APPLIED TOWARDS OPERATIONS AND MAINTENANCE EXPENSES THAT THEN FLOW INTO AN OPERATIONS AND MAINTENANCE
[00:05:01]
RESERVE FUND THAT THEY'RE REQUIRED TO HAVE UNDER THE INDENTURE OF AT LEAST OF, OF AT LEAST TWO MONTHS.IT THEN FLOWS INTO DEBT SERVICE REQUIREMENTS, YOU KNOW, ANY, ANY DEBT PAYMENTS THAT THEY HAVE, EITHER ON LONG-TERM OR SHORT-TERM DEBT WOULD BE THAT NEXT CATEGORY.
THEN CITY PAYMENT WHERE WE, WE RECEIVE A RETURN FROM SAS AND THEN YOU HAVE WHAT'S CALLED THE RENEWAL OR REPLACEMENT FUND, AND THERE'S TWO CATEGORIES THERE.
THERE CAN BE RESTRICTED, UH, UH, WHAT WE CALL 'EM, R AND R FUNDS.
THESE CAN BE THINGS LIKE IMPACT FEES.
THOSE HAVE TO BE USED FOR SPEC SPECIFIED PROJECTS THAT WERE DEFINED UNDER THE IMPACT FEE, UH, PROCESS.
AS YOU GO THROUGH THIS WATERFALL AND YOU PAY FOR O AND M, YOU PAY FOR DEBT SERVICE, YOU MAKE THE CITY PAYMENT, ANYTHING THAT'S LEFT AT THE END OF THE DAY FLOWS INTO THIS R AND R FUND.
AND IT'S USED TO CASH FUND THE CAPITAL PROGRAM.
SAS WILL BE GOING THROUGH AND TALKING ABOUT THEIR, THEIR VERY LARGE CAPITAL PROGRAM.
UH, A BIG PORTION OF THAT IS FUNDED WITH DEBT, BUT A VERY LARGE PORTION IS ALSO FUNDED WITH CASH.
THAT CASH CO COMES FROM THIS FLOW AND FROM THIS R AND R FUND.
SO WITH SAWS, WE'LL GO THROUGH, UM, NEXT THE, THE KIND OF THE BUSINESS CASE, UH, FOR THEIR REQUEST OF INCREASE INCREASING THEIR RATES IN 2018 AND 19.
AFTER THEY COME UP AND GO THROUGH THAT, I'LL COME UP AND JUST WRAP UP VERY QUICKLY JUST ON THE PROCESS THAT WE WENT THROUGH TO REVIEW THEIR REQUEST FOR THE RATE INCREASES AS WELL AS OUR RECOMMENDATION.
SO WITH THAT, LEMME TURN IT OVER TO ROBERT PUENTE, WHO IS THE PRESIDENT AND C E O OF SAS WHO WILL BEGIN THE SAS PRESENTATION.
MR. MAYOR, COUNCIL MEMBER, CITY MANAGER.
UH, FIRST OF ALL, IT'S A PLEASURE TO BE HERE, UH, AGAIN IN FRONT OF Y'ALL.
UM, AT THE ONE OF OUR LAST MEETINGS, UH, Y'ALL ENCOURAGED SAWS TO, UH, COME MORE FREQUENTLY AND HOPEFULLY THIS IS, UH, THE START OF CONTINUING REPORTING TO YOU AS TO HOW WE ARE DOING AS, UH, MAYOR NUREMBERG NOTED AT OUR OUR SEPTEMBER BOARD MEETING.
WHAT WE ARE PRESENTING TO YOU TODAY IS A BACK TO THE BASICS INFRASTRUCTURE BUDGET, AND THIS WILL ENSURE RELIABLE SERVICE.
UM, AND THE THING THAT WE'RE ALWAYS TALKING ABOUT IS WATER SECURITY AND WATER RESILIENCY.
I THINK THIS WILL BE ABLE TO SHOW OUR COMMUNITY THAT WE'RE GETTING BACK TO THE BASICS ON THOSE TWO ITEMS. BUT PUT, BUT PUT VERY SIMPLY, THE, THE BIG DRIVERS OF THIS RATE INCREASES IS OUR CAPITAL PROGRAM.
IT'S GOING FROM 250 MILLION, UH, JUST TWO YEARS AGO TO OVER 417 MILLION IN 2019.
UH, AND THIS WILL ALLOW US TO ADDRESS THOSE, UH, ISSUES OF THE NEXT MILLION THAT ARE COMING INTO OUR COMMUNITY AND, AND WOULD ALSO HELP SATISFY THE, THE FEDERAL REQUIREMENTS OF OUR CONSENT.
CREE A A LOT OF, YOU KNOW, SAWS AS THE UTILITY, OBVIOUSLY THAT PROVIDES, UH, WATER TO OUR, TO YOUR CUSTOMERS, BUT WE'RE VERY LARGE.
WE'RE PROBABLY ONE OF THE LARGEST MUNICIPAL UTILITIES IN THE NATION.
WE SERVE ABOUT ALMOST 2 MILLION CUSTOMERS OVER FOUR COUNTIES, 1700 EMPLOYEES, 6 BILLION, UH, DOLLARS WORTH OF ASSETS.
AND A LOT OF THOSE ASSETS YOU DON'T GET TO SEE, THEY'RE BURIED UNDERGROUND.
BUT, UH, THESE, UH, PLANTS, UH, STATIONS, WELLS, TANKS THAT WE HAVE, UH, HAVE TO BE RUN 24 7, AND THEY HAVE TO BE RUN IN, IN A WAY TO PROVIDE THE MOST BASIC OF SERVICES, AND THAT IS WATER, WATER WHEN YOU NEED IT, AND THEN GETTING RID OF THE WATER WHEN YOU DON'T NEED IT ANYMORE.
AS YOU CAN SEE FROM THIS, UH, PIE CHART, NEARLY TWO THIRDS OF OUR ASSETS ARE PIPES.
UH, IF YOU LOOK AT, UH, 26% OF WASTEWATER PIPES, 39% WATER PIPES, ROUGHLY TWO THIRDS OF THAT ARE, ARE OUR ASSETS.
THE OTHER ONE THIRD OR SO ARE, ARE WASTEWATER PLANTS AND OUR H TWO O PLANT.
BUT WHEN YOU LOOK AT THE, UH, SPENDING OF OVER THE LAST FEW YEARS, YOU'LL SEE THAT THE MAJORITY OF THE SPENDING WAS TO OUR WASTEWATER PIPES, AND THAT WAS IN RESPONSE TO THE CONSENT DECREE.
UH, WHAT WE'RE WANTING TO DO IS TO MAKE SURE THAT THE, UH, THE LACK OF MAINTENANCE IN THE 1990S OF OUR SEWER SYSTEM DOES NOT HAPPEN IN OUR WATER SYSTEM.
SO YOU'LL SEE A RENEWED EFFORT IN THIS BUDGET TO, TO MAKE IT, TO MAKE THE WATER SYS THE WATER PART OF OUR SYSTEM ON PAR WITH THE WASTEWATER.
OUR CAPITAL PROGRAM, AS YOU CAN SEE, IS VERY LARGE.
IF YOU, UM, LOOK THROUGHOUT THE NEXT FIVE YEARS, OVER $2 BILLION WORTH, WORTH OF PROJECTS THAT WE HAVE, UH, TO GIVE YOU AN IDEA OF WHAT THE, UH, OF WHAT THAT MEANS, UH, WE RECENTLY, AS SAN ANTONIONS VOTED FOR AN $850 BILLION, UH, BOND OVER THE, OVER THE FIVE YEARS.
THIS IS 2 BILLION OVER THOSE NEXT FIVE YEARS.
AND YOU CAN SEE THAT WASTEWATER STILL CONTINUES TO BE A BIG PART OF WHAT WE'RE DOING.
AND AGAIN, THAT'S TO, UH, COMPLY WITH THE REQUIREMENTS OF THE CONSENT DECREE, BUT ALSO THE PARTICULAR, UH, THE, THE, THE MOST BASIC THING OF WANTING TO MAKE SURE
[00:10:01]
THAT OUR SEWER, OUR SEWER SYSTEM DID NOT HAVE, DOES NOT HAVE THOSE OVERFLOWS IN ORDER TO ACCOMPLISH WHAT WE'RE TRYING TO DO AS ONE OF THE NATION'S LARGEST UTILITIES.AND BY THE WAY, IT'S A UTILITY THAT HAS RECEIVED NATIONAL, UH, RECOGNITION BY A PLATINUM AWARD, BY THE U UH, ASSOCIATION OF METROPOLITAN AGENCIES AND AN AWARD FROM T C Q AS ENVIRONMENTAL EXCELLENCE AWARD.
BUT IN ORDER TO DO THAT, WE NEED TO HAVE THE FUNDS TO CONTINUE TO, UH, UH, BE ON THAT INNOVATION CURVE THAT WE HAVE AND, AND REALLY BE RESPONSIVE TO OUR CUSTOMERS.
UH, YOU WILL SEE THAT WE'RE GONNA BE ASKING FOR A RATE ADJUSTMENT OF 5.8% IN 2018 AND 4.7% IN 2019.
WE WILL GO IN MUCH MORE DETAIL, UH, REGARDING THESE REQUESTS, UH, LATER.
BUT AS I MENTIONED, UH, THESE, ESPECIALLY 2018, IS REALLY DRIVEN BY OUR CAPITAL PROGRAM.
2019 INCLUDES ALSO A VERY LARGE CAPITAL PROGRAM, BUT ALSO, UH, M A M I, AUTOMATED METER INFRASTRUCTURE.
AND I THINK THIS IS GOING TO BE SOMETHING THAT OUR CUSTOMERS ARE GONNA BE DEMANDING, BUT SOMETHING THAT REALLY HELPS US, UH, KEEP IN LINE WITH WHAT OUR CUSTOMERS ARE DOING AND IS ONE OF THE BEST CONSERVATION TOOLS THAT WE CAN SEE IN THE, IN THE FUTURE WHERE, UH, A CUSTOMER WILL SEE ALMOST IMMEDIATELY, IF NOT HOUR BY HOUR, WHAT THEIR USAGE IS.
AND IF THEY SEE A SPIKE FOR WHATEVER REASON, THEY KNOW THERE'S A PROBLEM, INSTEAD OF RIGHT NOW HAVING TO WAIT TILL THE END OF THE MONTH OR THE NEXT MONTH WHEN THEY GET THEIR BILL AND ALL OF A SUDDEN THEY SEE THAT STICKER SHOCK, UH, OF A VERY LARGE BILL.
UH, WHAT I WOULD LIKE TO DO NOW IS ASK STEVE KLAUS, OUR CHIEF OPERATING OFFICER, COME AND TELL YOU ABOUT OUR CAPITAL PROGRAM AND WHAT WE'RE TRYING TO DO IN THAT ENDEAVOR.
GOOD AFTERNOON, MAYOR, COUNCIL MEMBERS, CITY MANAGER SINCE, SINCE INFRASTRUCTURE IMPROVEMENTS ARE THE BIGGEST FACTOR IN RATE INCREASES OVER THE NEXT TWO YEARS, LET'S SPEND A LITTLE BIT OF TIME GOING OVER EACH OF OUR FOUR INFRASTRUCTURE AREAS AT SAS.
AND I ALSO WANT TO EXPAND ON OUR HISTORICAL AND OUR PROJECTED FUTURE CAPITAL INVESTMENTS.
ROBERT MENTIONED OUR INFRASTRUCTURE SIZE.
THAT INFRASTRUCTURE REQUIRES CONSTANT EFFORT TO RENEW AND REPLACE THE ASSETS TO ENSURE THE SYSTEM IS RELIABLE FOR THE FUTURE.
SAWS CONSISTENTLY PUTS MONEY INTO THE RENEWAL PROGRAM.
IN THIS PRESENTATION, I WANNA HIGHLIGHT SOME OF OUR HISTORICAL HIGH PRIORITY WATER INITIATIVES.
EACH UTILITY FACES CHALLENGES ADDRESSING THESE HIGH PRIORITY ITEMS WHILE CONTINUING TO ADDRESS THE REQUIRED RENEWAL AND REPLACEMENT FOR THE REST OF THE SYSTEM.
OVERALL, OUR C I P PROGRAM IS VERY COMPLEX IN WHAT WE HAVE TO BALANCE OVERALL, BUT THE GOALS OF THE PROGRAM ARE ACTUALLY QUITE SIMPLE.
OBVIOUSLY, WE WANT TO ENSURE RELIABLE SERVICE, WE WANNA BE EFFICIENT IN OUR USE OF PUBLIC EXPENDITURES, AND WE WANNA MAXIMIZE THE FUNCTIONAL LIFE OF THOSE PUBLIC INVESTMENTS.
I WANNA MAKE JUST A COUPLE OF BRIEF COMMENTS ABOUT GROWTH.
EVERY YEAR THE SYSTEM GROWS THAT GROWTH MEANS THAT EVERY YEAR WE SHOULD HAVE SOME INCREASE IN OUR REHABILITATION AND REPLACEMENT EFFORTS TO ENSURE THAT RELIABILITY OF THE SYSTEM.
WHILE SAWS DOES INSTALL SOME NEW PIPE, NEW PIPE TO IMPROVE THE FUNCTIONALITY OF THE SYSTEM.
MOST NEW INFRASTRUCTURE COMES FROM DEVELOPERS, THE RATE OF DEVELOPER DEVELOPMENT, THE RATE OF DEVELOPER CONTRIBUTIONS FLUCTUATES ON A YEAR TO YEAR BASIS, BUT USUALLY EXCEEDS 100 MILES OF PIPE PER YEAR.
OVER THE LAST FEW YEARS, SAS HAS BEEN ASKED TO ACQUIRE SYSTEMS. THE REALITY IS SAS IS BEING ASKED TO ACQUIRE THESE SYSTEMS BECAUSE THEY'RE UNDERPERFORMING OR BECAUSE THEY'RE BEHIND ON THEIR SYSTEM.
OF COURSE, ACQUISITIONS LIKE BARE MET RADICALLY CHANGE THE SIZE OF THE SA SYSTEM.
OVERALL, ALL THESE ACQUISITIONS REPRESENT THE FIRST REAL CHALLENGE FOR A BALANCED RENEWAL OF OUR SYSTEM.
ACQUISITIONS OF UN UNDERPERFORMING SYSTEMS COME WITH AN EXPECTATION OF IMMEDIATE IMPROVEMENT.
ADDITIONALLY, THESE SYSTEMS LEAVE SAWS WITH PIPELINES THAT ARE OFTEN UNDERSIZED FOR THE COMMUNITIES THAT THEY SERVE.
THESE SITUATIONS LEAVE SAWS WITH MAJOR OPERATIONAL AND INFRASTRUCTURE CHALLENGES.
THAT IS ALL WE'LL SAY ABOUT GROWTH OVERALL.
FOR NOW, THE REST OF THIS PRESENTATION WILL FOCUS ON SAWS, BREAD AND BUTTER OF THE CAPITAL IMPROVEMENT PROGRAM ARE RENEWAL AND PLACEMENT.
LET'S START TO DISSECT THE WAY THAT SAS SPENDS MONEY ON INFRASTRUCTURE RENEWAL.
THE FIRST PEOPLE, FIRST THING PEOPLE DON'T UNDERSTAND IS THAT A PORTION OF OUR CAPITAL IMPROVEMENT PROGRAM SPENDING IS NOT ON PIPELINES THAT SAWS WOULD CHOOSE TO REPLACE.
ABOUT 13% OF OUR TOTAL INFRASTRUCTURE
[00:15:01]
SPENDING GOES TO GOVERNMENTAL PROGRAMS. WHAT WE DO IN SUPPORT OF BEXAR COUNTY, WHAT WE DO WITH CITY AND WHAT WE DO WITH THE TXDOT, THESE PROGRAMS ARE LOGICAL WHERE SAS IS SUPPORTING ROAD WORK THAT IS GOING TO BE DONE BY OTHERS.66% OF OUR GOVERNMENTAL PROGRAMS IS MONEY THAT WE SPEND IN SUPPORT OF CITY WORK.
IF A PIPE CONDITION WARRANTS REPLACEMENT IN ADVANCE OF THE ROAD WORK, WE REPLACE IT.
BUT OFTEN THESE PIPES ARE BEING REPLACED BECAUSE THE ROADWORK CREATES A CONFLICT WITH WHERE OUR PIPE IS AT.
WE JUST HAVE TO MOVE OUR PIPE TO GET IT OUTTA THE WAY.
FOR THE ROADWORK, THIS MEANS THAT A PERFECTLY GOOD PIPE IS BEING REPLACED.
ABOUT 50% OF THE TIME SAW IS REPLACING PIPES THAT DID NOT NEED TO BE REPLACED.
FOR SAW SERVICE NEEDS, IT'S IMPORTANT TO REALIZE THAT WITH THE PIPE NEEDING REPLACEMENT, WE ONLY REPLACE THE PART THAT GOES ACROSS THE ROAD AND SOME SHORT DISTANCE BEYOND THAT, WE HAVE TO COME BACK AT A LATER DATE TO REPLACE THE LONGER PORTIONS OF THE PIPE WELL BEYOND THE ROADWAY.
THIS CONDITION CAN LEAD TO A PATCHWORK OF PIPE AGES AROUND ROADS.
AS FUTURE CITY BOND PROGRAMS ADDRESS MORE ROAD CONSTRUCTION, IT'S IMPORTANT THAT SASS FUNDING IN SUPPORT OF THIS WORK MUST INCREASE AS WELL.
IF THIS DOES NOT HAPPEN, THEN MORE MONEY PROPORTIONALLY GOES TO REPLACE GOOD PIPES AND LESS MONEY.
PROPORTIONATELY GOES TO REPLACE BAD PIPES.
THIS PROGRAM IS MANDATED AND WARRANTED, SO IT'S JUST A COMPLICATION WE NEED TO DEAL WITH AS WE PLAN FOR THE SYSTEM OVERALL.
SAN ANTONIO, LIKE OTHER MAJOR CITIES, MUST DEAL WITH PRIORITIES AROUND WATER AND CAPITAL IMPROVEMENTS.
IN THE 1980S, SAN ANTONIO CONDUCTED WHAT WE CALL THE TWO OH ONE PROGRAM.
THIS PROGRAM WAS A MASSIVE EFFORT TO IMPROVE WATER AND WASTEWATER INFRASTRUCTURE, PARTICULARLY IN THE DOWNTOWN AREAS.
THIS PROGRAM, WHICH CAPITALIZED ON FEDERAL MATCHING GRANT FUNDS, WAS PROPORTIONATELY LARGER THAN OUR CONSENT DECREE IS TODAY.
SO IT WAS REALLY A MASSIVE EFFORT.
PEOPLE OFTEN ASSUME THAT THE OLDEST PARTS OF OUR SYSTEM ARE THOSE IN THE DOWNTOWN BUSINESS DISTRICT, BUT THE REALITY IS THAT MOST OF THOSE PIPES IN THE DOWNTOWN DISTRICT WERE REPLACED THROUGH THE 2 0 1 PROGRAM BACK IN THE EIGHTIES AFTER THE 2 0 1 PROGRAM, SAS HAD AN INITIATIVE CALLED THE COMPETITIVE EDGE PROGRAM, WHERE WE ATTEMPTED NOT TO RAISE WASTEWATER RATES FOR MANY YEARS.
WE FOCUSED REALLY HEAVILY ON IMPROVING OUR PERFORMANCE IN OUR EFFICIENCY OF OUR OPERATIONS, BUT WE TRIED NOT TO COME BACK FOR RATE INCREASES.
WE, WE WERE SUCCESSFUL WITH THAT AND IN HINDSIGHT, WE WERE REALLY DEFERRING RENEWALS OF OUR SEWER SYSTEM.
OVERALL, INFRASTRUCTURE INVESTMENT RE REQUIREMENTS SHOULD NOT END.
NEXT WAS OUR PER OUR PUSH FOR WATER SUPPLY DIVERSIFICATION.
THAT PROGRAM HAS BEEN AN INTENSE FOCUS FOR THE LAST DECADE AND A HUGE SUCCESS OVERALL.
FINALLY BRINGS US TO OUR CONSENT DECREE WITH THE U S E P A.
THIS PROGRAM IS A MANDATED INFRASTRUCTURE INVESTMENT WITH THE INTENT OF BUILDING A SYSTEM THAT'S CAPABLE OF PROGRESSING GROWTH IN SAN ANTONIO THROUGH AT LEAST THE YEAR 2040.
IT'S A MASSIVE EFFORT THAT DOMINATES WHAT WE DO AT SASS OVER THE NEXT FEW YEARS.
THIS PROGRAM WILL IMPACT THE COMMUNITY NOT ONLY THROUGH OUR WATER BILLS, BUT THROUGH THE DISRUPTION OF ALL THE CONSTRUCTION WORK THAT WE WILL HAVE TO DO.
EACH OF THESE PRIORITY INITIATIVES HAS BROUGHT A GREAT BENEFIT TO OUR CITY, BUT EACH PROGRAM MAKES IT CHALLENGING TO CONSISTENTLY BALANCE OUR ABILITY TO FUND RENEWAL AND REPLACEMENT ACROSS THE REST OF OUR ORGANIZATION OF REST OF OUR INFRASTRUCTURE.
THE 2 0 1 PROGRAM AND THE CD PROGRAM REPRESENT CATCHUP EFFORTS.
THESE PROGRAMS MUST BE FOLLOWED WITH CONSISTENT PLANNED RENEWALS, OR SAN ANTONIO WILL INEVITABLY BE BACK IN THE CATCHUP MODE AGAIN.
SO LET'S TAKE A DEEPER DIVE INTO EACH OF OUR FOUR INFRASTRUCTURE AREAS AND GET A SENSE OF OUR OPERATIONAL READINESS OVERALL.
HERE'S JUST A QUICK VIEW OF WHERE WE'VE BEEN DOING THE LARGE PROJECT WATER FACILITY UPGRADES OVER THE LAST 10 YEARS IN WATER FACILITIES.
WE HAVE FOR MANY YEARS FOLLOWED A REGULAR PATTERN OF CONDUCTING COMPLETE STATION REHAB IN A SYSTEMATIC MANNER AS THESE STATIONS AGE.
AS ROBERT MENTIONED, WE HAVE MORE THAN 70 OF THESE STATIONS, SO WE WILL CONTINUE TO ADDRESS THESE FACILITIES GOING FORWARD.
IN THE FUTURE, WE WANT TO GET THE MAXIMUM POSSIBLE LIFE OUT OF THESE INVESTMENTS.
WHEN WE COMPLETE THE WORK AT A STATION, WE KNOW THAT THE STATION IS IN GOOD CONDITION FOR THE FORESEEABLE FUTURE.
OVERALL, OUR WATER PUMPING STATIONS AND PLANTS ARE IN GOOD SHAPE.
WE CANNOT DELAY OR DEFER THE WATER FACILITY UPGRADES OR THESE SYSTEMS WILL QUICKLY FALL INTO AN UNRELIABLE STATUS.
[00:20:03]
SO THAT'S OUR WATER PLANTS.NETFLIX CONSIDER OUR WASTEWATER PLANTS.
AS YOU CAN SEE, OUR WATER WASTEWATER PLANTS EXIST IN THE SOUTHERN AND WESTERN PARTS OF BEXAR COUNTY.
AS THE CITY WAS ESTABLISHED, ENGINEERS UTILIZE THE MOST EFFICIENT WAY TO MOVE THAT WATER BY GRAVITY WHEN WE BUILT THE SEWER COLLECTION SYSTEM.
THEREFORE, THE LOWEST ELEVATIONS IN BEXAR COUNTY ARE GENERALLY WHERE THESE PLANTS ARE LOCATED.
WASTEWATER PLANTS SEEM TO CONSTANTLY BE UNDER CONSTRUCTION SAUCE.
FACILITIES ARE WHAT I WOULD DESCRIBE AS AS MIDDLE AGED PLANTS.
OUR ME CREEK FACILITY IS OUR NEWEST INFRASTRUCTURE AND IT'S ABOUT 10 YEARS OLD.
OUR FLAGSHIP, THE DOS RIOS FACILITY, WILL CELEBRATE ITS 30TH BIRTHDAY LATER THIS YEAR.
THE SATO FACILITY IN THE SOUTHWEST SOUTHEAST AREA, I'M SORRY, WHAT WAS RECENTLY.
OUR OLDEST PLANT HAS NOW BEEN DECOMMISSIONED.
WASTEWATER PLANTS ARE VERY EXPENSIVE TO CONSTRUCT.
IF WE WERE TO REPLACE DOSE RIOS TODAY, THAT WOULD PROBABLY BE BETWEEN 1.2 AND $1.5 BILLION IN COST.
SAS HAS BEEN CONSISTENTLY INVESTING IN THESE FACILITIES.
WE'VE AVERAGED ABOUT $18 MILLION A YEAR OVER THE LAST 10 YEARS WITH REGULAR RENEWAL INVESTMENT GOING FORWARD, THESE FACILITIES SHOULD EASILY HAVE GREATER THAN 25 YEARS OF LOOSE USEFUL LIFE IN THE FUTURE.
SO THAT'S OUR WATER AND OUR WASTEWATER FACILITIES.
NOW LET'S SHIFT OVER TO START CONSIDERING OUR, THE BIGGEST PART OF OUR INFRASTRUCTURE, OUR PIPELINES.
THIS INFORMATION THAT I'M SHOWING YOU IS PROVIDED BY THE AMERICAN SOCIETY OF CIVIL ENGINEERS, AND IT GIVES US A GENERAL RULE OF THUMB ON HOW LONG WE SHOULD EXPECT OUR UNDERGROUND ASSETS TO LAST.
OUR CONSENT DECREE PROGRAM HAS INCREASED OUR INVESTMENT FOR WASTEWATER PLANTS TO WHERE IT IS WITHIN THE ENGINEER'S RECOMMENDATIONS, BUT OUR INVESTMENT IN WATER PIPELINES FALLS BELOW THE ENGINEER'S RECOMMENDATIONS OVERALL, HERE'S A QUICK WAY THAT YOU CAN ASSESS OUR SYSTEM, THE DECADE THAT THE SYSTEM WAS ACTUALLY CONSTRUCTED.
AS YOU CAN SEE, THE MAJORITY OF OUR SYSTEMS IN PLACE TODAY HAVE BEEN CONSTRUCTED SINCE THE 1980S.
WE DON'T HAVE SOME DATA ON THE BARE MET PIPES, SO WE ARE SHOWING THAT AS PART OF OUR SYSTEM IN THE 2010 DECADE, THAT'S WHAT'S CAUSING THE PEAK IN THE PURPLE AREA THERE UNDER 2010.
IN FACT, THE AVERAGE AGE OF PIPE IN SAN ANTONIO IS 28 TO 29 YEARS OLD.
SO IT MEANS THAT WE HAVE SMALL AMOUNTS OF MUCH OLDER PIPE AND LARGE AMOUNTS OF NEWER PIPE.
THE CONSENT DECREE PROGRAM WILL PUT OVER A BILLION DOLLARS OF NEW INFRASTRUCTURE UNDERGROUND.
WHILE IT'S EASY TO FOCUS ON THE FINANCIAL COST OF THE CONSENT DECREE, WE MUST ALSO CONSIDER THE IMPACT TO THE COMMUNITY FROM THIS CONSTRUCTION.
NO ONE WANTS WASTEWATER PIPES NEXT TO RIVERS OR CREEKS.
NO ONE WANTS THESE IN THE PARKS.
AND AS YOU CAN SEE BY THESE PICTURES, CONSTRUCTION IN THE ROADWAY IS IMMENSELY DISRUPTIVE.
WE'RE THRILLED TO SEE SOME OF THESE PROJECTS BECOMING A REALITY AND WE APPRECIATE THE PUBLIC'S PATIENCE WHILE WE TRY TO GET THIS DONE IN THE LEAST DISRUPTIVE MANNER POSSIBLE.
BUT WE MUST BE COGNIZANT THAT AFTER THE CON, AFTER THE CATCH UP PERIOD THAT THE CONSENT DECREE REPRESENTS, WE MUST CONTINUE TO CONDUCT REHAB AND RENEWAL THE SYSTEM AS IT AGES A A SYSTEM THE SIZE OF SAN ANTONIO, THAT WORK NEVER ENDS.
WE RAMPED UP OUR INVESTMENTS IN SEWER INFRASTRUCTURE BEFORE THE CONSENT DECREE BECAME EFFECTIVE IN 2013.
HERE'S A QUICK LOOK AT WHERE WE'VE BEEN DOING LARGE PROJECTS IDENTIFIED IN BLUE OVER THE LAST 10 YEARS AND WHAT LARGE PROJECTS WE'LL BE DOING OVER THE NEXT FIVE YEARS, WHICH IS IDENTIFIED IN GREEN.
WE HAVE COMPLETED DETAILED INSPECTIONS OF EVERY SEWER PIPE IN SAN ANTONIO.
SO THE GREEN PIPES REALLY REPRESENT THE WORST OF THE LARGE DIAMETER SEWER INFRASTRUCTURE UNDERGROUND TODAY.
THAT'S WHERE OUR PROBLEMS ARE.
WE KNOW WHERE THE PROBLEMS EXIST.
WE LOVE SEEING THESE GREEN SPOTS TURN BLUE.
KEEP IN MIND THAT THESE ARE JUST THE LARGE PROJECTS ACROSS THE CITY.
WE'RE DOING SMALLER TARGETED REHABS EVERYWHERE.
WE COULD NOT POSSIBLY PUT THAT ON A MAP WHERE IT WOULD MAKE ANY SENSE VISUALLY.
SO FINALLY, WE COME TO OUR LAST PIECE OF INFRASTRUCTURE.
WATER PIPES BEHAVE VERY DIFFERENTLY THAN WASTEWATER PIPES FIRST.
WASTEWATER PIPES ARE EASY TO INSPECT.
YOU OPEN A MANHOLE, YOU PUT IN A CAMERA OR SOME OTHER DEVICE, AND YOU REALLY GET A PRETTY GOOD IDEA OF HOW THAT PIPE IS DOING.
WATER PIPES DO NOT HAVE INSPECTION ACCESS POINTS, AND OF COURSE, THEY ARE UNDER PRESSURE.
BUT BECAUSE THESE PIPES ARE UNDER PRESSURE, WE KNOW
[00:25:01]
WHEN A PROBLEM DEVELOPS AND WE USUALLY KNOW ABOUT IT RIGHT AWAY.SO WE DISPATCH A CREW AND WE FIX IT.
WHEN A WASTEWATER PIPE BEGINS TO FAIL, WE MAY NOT KNOW ABOUT IT FOR A LONG TIME, AND THAT CONDITION CONTINUES TO GET WORSE AND WORSE BEFORE WE LIKELY FIND OUT ABOUT IT.
BECAUSE OF THE GASES ASSOCIATED WITH WASTEWATER PIPES, THEY'RE UNDER A MUCH MORE CORROSIVE ATMOSPHERE AND THEY DISSOLVE.
THEY ESSENTIALLY FAIL FROM THE INSIDE OUT.
FINALLY, SAWS HAS A BENEFIT TO OUR WATER PIPES THAT MOST CITIES JUST DON'T HAVE.
THE LUXURY OF OUR WATER FROM THE AQUIFER IS RICH IN CALCIUM AND OTHER MINERALS.
SO THAT FILM THAT BUILDS UP ON YOUR GLASSWARE, THAT THAT RESIDUE THAT BUILDS UP ON YOUR SHOWER FAUCET, THAT'S ACTUALLY FANTASTIC FOR OUR WATER PIPES.
A CALCIUM BUILDUP OCCURS ON THE INSIDE OF OUR PIPES AND PROTECTS OUR PIPES FROM CORROSION.
THIS NATURAL CORROSION INHIBITOR GIVES SAS THE ABILITY TO GET MORE LIFE OUT OF OUR PIPES AND PROTECTS OUR WATER QUALITY THAT WE DELIVER TO OUR CUSTOMERS.
WE DO NOT HAVE THE NATURALLY CORROSIVE WATER THAT HAS CAUSED THE DANGEROUS LEAD LEVELS AND OTHER WATER QUALITY PROBLEMS THAT HAVE OCCURRED IN FLINT, MICHIGAN AND OTHER PARTS OF THE US.
IT'S EASY TO ASSUME THAT WATER PIPES SHOULD BE REPLACED ON AGE.
AGE IS IMPORTANT, BUT OTHER FACTORS MIGHT BE MORE IMPORTANT THAN AGE.
WHEN CONSIDERING WHERE TO INVEST FOR RENEWAL, THE GREATEST THREAT TO SOIL WATER PIPELINES IS SOIL MOVEMENT.
WE ALL KNOW OF AREAS OF TOWN WHERE THE ROADWAY SEEMS TO CONSTANTLY BE FULL OF BUMPS AND SWALES.
IF YOU'VE EVER BEEN OVER ON SUNSET STREET OR OVER BY MCCREE LIST MALL, IT SEEMS LIKE EVERY TIME THE CITY FIXES THE ROAD IN JUST A FEW YEARS, THE PROBLEM CAN RETURN.
THAT IS CLAY SOIL MOVEMENT, AND IT'S DOING THE SAME THING TO OUR WATER PIPES.
TO GIVE YOU A GOOD WAY TO THINK OF THIS, WE HAVE ABOUT 150 LEAKS PER MONTH REPORTED IN THE FALL, WINTER, AND SPRING PERIOD.
IF YOU'VE LOOKED AT THE SUMMER MONTHS, WHEN THE SUN DRIES OUT, ESPECIALLY WE GET, WHEN WE GET INTO A REAL DROUGHT SITUATION, OUR REPORT OF LEAKS WILL GO OVER 600 PER MONTH.
SOIL MOVEMENT IS THE LARGEST REASON FOR THIS INCREASE.
SO IN PARTS OF TOWN THAT HAVE THE GREATEST AMOUNT OF CLAY SOILS FOR RENEWAL CONSIDERATION, AGE IS SECONDARY, IS A SECONDARY CONSIDERATION AT BEST.
THE GOOD NEWS HERE IS THAT A LOT OF OUR PIPE IS IN ROCK, AND THOSE PIPES ARE NEVER IMPACTED BY SOIL MOVEMENT.
SO LOCATION AS IMPACTED BY THE SOIL TYPES IS A CRITICAL PIECE OF THE RENEWAL.
PIPE MATERIALS ARE ANOTHER FACTOR TO CONSIDER IN RENEWAL.
INVESTMENT LEAD PIPE ACTUALLY RESISTS SOIL MOVEMENT AND THEY CAN LAST VIRTUALLY FOREVER.
BUT FOR OBVIOUS REASONS, WE WOULD NEVER CONSIDER PUTTING THEM IN TODAY.
WE DO NOT NEED TO INVEST IN REPLACING LEAD PIPES BECAUSE SAN ANTONIO DID THAT WORK IN THE EARLY 1990S.
ANOTHER PIPE TO CON TO CONSIDER IS ASBESTOS CONCRETE.
THIS WAS THE BEST PIPE AVAILABLE IN THE 1950 AND 1960 TIMEFRAME.
TODAY, WE WOULD NOT PUT THAT PIPE MATERIAL IN, BUT JUST BECAUSE A PIPE MATERIAL FALLS OUT OF FAVOR DOES NOT MEAN WE GO BACK AND WE REPLACE ALL THOSE PIPES IMMEDIATELY.
WE NEED TO CONSIDER THE PERFORMANCE OF EACH PIPE MATERIAL AND AS WE CONSIDER INVESTMENT FOR INVESTMENT IN RENEWAL DOLLARS.
ANOTHER ASPECT OF PIPE MATERIALS THAT IS, IS THAT NEWER IS NOT ALWAYS BETTER.
CARS BUILT IN THE MID 1970S AND 1980S WERE CONSIDERED TO BE POOR QUALITY OVERALL.
HOW MANY OF YOU DROVE IN A CADILLAC CIMARRON OR A CHEVROLET CHAVET OR A FORD PINTO OR THE LOWLY HUGO OVERALL PIPES ARE THE SAME.
EARLY P V C AND POLY BUTAL PIPES FROM THAT PERIOD, UM, WERE VERY POOR QUALITY AND THEY TENDED TO FAIL QUICKLY.
SOME OF OUR OLDEST PIPES WERE FAR BETTER QUALITY THAN THOSE EXAMPLES FROM THE 1970S.
PRESSURE FINALLY IS ALSO A MAJOR CONSIDERATION.
GROUND ELEVATION IN BEX COUNTY FALLS BY 1,400 FEET FROM NORTHWEST BEAR COUNTY TO SOUTHEAST BEAR COUNTY.
IF WE RAN THE COUNTY AS A SINGLE PRESSURE ZONE, ALL A SINGLE SYSTEM, THEN THE FOLKS IN THE SOUTHEAST SECTION WOULD GET BLASTED WITH WATER PRESSURE WHILE THE FOLKS IN THE NO NORTHWEST WOULD'VE.
THIS MAP GIVES YOU AN, GIVES YOU A, AN IDEA OF HOW WE HAVE BROKEN UP THE SYSTEM.
WE'VE ACTUALLY GOT 15 DIFFERENT PRESSURE ZONES OR MINIATURE WATER SYSTEMS. WE'RE OPERATING ACROSS THAT ELEVATION IN SPITE OF SPLITTING, SPLITTING UP THESE PRESSURE PLANES IN OUR SYSTEM.
THE FOLKS IN THE LOWER PORTIONS OF EACH COLOR
[00:30:01]
ACTUALLY HAVE HIGHER PRESSURE THAN THE FOLKS IN THE UPPER PORTION OF EACH OF THESE COLORS.WE TRY TO BE SURE TO GET THE, THE, THE HIGH PRESSURE CLASS OF PIPE OR THE STRONGER PIPE INTO THOSE AREAS WHERE WE KNOW WE HAVE HIGHER PRESSURE.
CLEARLY HIGHER PRESSURE PUTS GREATER STRESS ON PIPES.
THEREFORE, PRESSURE AND PIPE PERFORMANCE IS ANOTHER MAJOR FACTOR TO CONSIDER WITH RENEWAL INVESTMENT, BECAUSE OUR WATER PIPE IS HARD TO INSPECT.
WE HAVE HISTORICALLY PLANNED ON REPLACEMENT JUST ON TWO SIMPLE CRITERIA.
HOW OLD IS THE PIPE AND HOW MANY TIMES HAS THE PIPE FAILED OVER TIME? AGE IS AN IMPORTANT FACTOR, BUT AS I STATED PREVIOUSLY, SOME OLD PIPES ARE ROBUST.
ONE OF OUR OLDEST PIPES IN SERVICE TODAY DATES BACK TO 1880.
THIS PIPE WAS SIGNIFICANTLY BUILT, OVERBUILT FOR ITS PURPOSE.
WE EXCAVATED AND INSPECTED THE PIPE.
IT LOOKS GREAT AND IT HAS A GOOD PERFORMANCE HISTORY.
WE SENT A GROUP OF SAMPLES OF THE PIPE TO SOUTHWEST RESEARCH FOR A COMPLETE FORENSIC EVALUATION.
THEY DID ELECTRON MICROSCOPE WORK ON IT, AND THEY RAN A WHOLE SERIES OF FAILURE TESTS ON IT.
THEY, THEY SENT US A REPORT BACK STATING THAT THE PIPE HAS AMPLE REMAINING USEFUL YEARS OF SERVICE WITHIN ITS PERFORMANCE EXPECTATIONS.
BASED ON THAT EVALUATION, WE MADE AN INFORMED DECISION NOT TO REPLACE THAT PIPE BREAK.
HISTORY IS ALWAYS A FACTOR TO CONSIDER.
IT SEEMS SIMPLE AND IT'S LOGICAL, BUT IT MEANS A PIPE MUST BE FAILING BEFORE WE REPLACE IT.
ONLY UNTIL VERY RECENTLY, THERE WERE VERY LIMITED TOOLS TO GIVE US INSIGHT INTO THE HEALTH OF OUR WATER PIPES BEFORE THEY FAIL.
THE WATER INDUSTRY NOW HAS A SUITE OF NEW PREDICTIVE WATER PIPE ASSESSMENT TOOLS.
SAWS IS ACTIVELY INVESTING IN THESE TECHNOLOGIES AND WE EXPECT THESE TECHNOLOGIES WILL CONTINUE TO PROVE IMPROVE IN THE FUTURE.
LEAK DETECTION TELLS US WHEN PIPES ARE BEGINNING TO SHOW FAILURES BEFORE WE HAVE PROBLEMS SIGNIFICANT ENOUGH TO DISRUPT OUR SERVICE.
WE HAVE CREWS DOING LEAK DETECTION ACROSS SAN ANTONIO EVERY DAY.
WE'RE NOW BUILDING LAUNCHING STATIONS ON OUR WATER PIPES INTO OUR MOST CRITICAL PIPELINES SO THAT WE CAN USE THESE DI DIAGNOSTIC TECHNOLOGIES THAT SHOW US WHERE PROBLEMS EXIST IN PIPELINES.
FOR EXAMPLE, WE CAN TAKE A TOOL AND RUN IT THROUGH A PIPE AND IT WILL TELL US HOW MUCH WALL THICKNESS REMAINS ON THAT PIPE, AND AT A LATER DATE, WE CAN REPEAT THAT EFFORT AND IT'LL SHOW US HOW QUICKLY THAT PIPE IS BREAKING DOWN.
OVERALL, THAT GIVES US THE ABILITY TO KNOW WHEN A, HOW MUCH LIFE REMAINS IN A PIPE AND BEFORE IT NEEDS TO BE REPLACED.
AS ANOTHER EXAMPLE, UH, WE KNOW WHERE WE'VE LOST CAPACITY IN PIPES BECAUSE OF AIR BEING TRAPPED OVERALL.
FINALLY, THE LOWER LEFT PICTURE, THERE IS A NEW A M I SYSTEM, AUTOMATED METER, UH, METERING INFRASTRUCTURE.
AND IT'S CHANGING WHAT UTILITIES KNOW ABOUT THEIR WATER SYSTEMS. WHILE THE TECHNOLOGY IS NEW AND IT IS VERY EXPENSIVE, SOME AI A M I SYSTEMS ARE BEING FITTING FITTED WITH PRESSURE AND LEAK DETECTION MONITORS AT EVERY SINGLE METER.
THIS GIVES US AN AMOUNT OF INFORMATION THAT WE COULD HAVE ONLY WISHED FOR PREVIOUSLY.
FOR NOW, THESE ADVANCED DIAGNOSTIC TOOLS ARE LIMITED TO OUR LARGEST AND OUR MOST CRITICAL WATER PIPELINES.
IT TAKES TIME AND EXPENSE TO DO THIS EVALUATION, BUT IT IS GIVING US ESSENTIAL DATA.
THIS INFORMATION WILL GIVE US A CLEAR AND FOCUSED PICTURE OF WHERE WE HAVE BAD PIPE PROBLEMS TODAY AND WHAT WE WILL NEED TO REPLACE IN THE FUTURE.
IF WE JUST SAID WE WERE GOING TO CONTINUE OUR CURRENT INVESTMENT IN WATER FACILITIES OR WATER PLANTS, WASTEWATER PLANTS AND WASTEWATER PIPES, BUT ALSO INCREASE OUR SPENDING LEVEL TO MEET THE SOCIETY OF CIVIL ENGINEER RECOMMENDATIONS, WE WOULD NEED TO IMMEDIATELY INCREASE OUR CAPITAL IMPROVEMENT PROGRAM BY ANOTHER $91 MILLION.
AS WE'VE HIGHLIGHTED, SAS HAS SOME UNIQUE ADVANTAGES THAT MAKE OUR PIPES LAST LONGER THAN PIPES IN OTHER WATER UTILITIES.
SO WE SHOULD INCREASE OUR SPENDING, BUT PROBABLY NOT AT THE RATE RECOMMENDED BY THE SOCIETY OF CIVIL ENGINEERS.
AS WE IMPROVE OUR UNDERSTANDING OF THE OVERALL HEALTH OF THE WATER PIPELINE USING THESE NEW DIAGNOSTIC TOOLS, WE WILL HAVE A MUCH BETTER UNDERSTANDING OF WHAT OUR INVESTMENT RATES SHOULD BE.
WE SHOULD BE CAUTIOUS AND INCREMENTALLY INCREASE SPENDING UNTIL WE HAVE A BETTER PICTURE OF OUR SYSTEM'S TRUE NEEDS BASED ON SOLID INFORMATION.
REGARDLESS, WE KNOW THAT OUR SYSTEM'S GOING TO GROW AND AGE, SO INCREASING RENEWAL FUNDING IS ESSENTIAL TO ENSURE THE LONG TERM RELIABILITY OF THIS SYSTEM.
THIS CHART SHOWS YOU THE TOP, THE TOTAL CAPITAL INVESTMENTS SINCE 2001 AND THE PROJECTED INVESTMENT
[00:35:01]
OVER THE NEXT FIVE YEARS.YOU CAN SEE THAT FROM 2001 TO 2012, THE FOCUS OF OUR CAPITAL INVESTMENT WAS HEAVILY WEIGHTED TOWARD WATER SUPPLY OR THE BLUE BARS.
OVERALL, AS WE BEGAN DEVELOPING THOSE SUPPLIES, THE AVERAGE CAPITAL PROGRAM SPEND DURING THIS PERIOD WAS $229 MILLION PER YEAR.
ONCE WE ENTERED THE CONSENT DECREE IN 2013, OUR WASTEWATER INVESTMENT, WHAT YOU SEE IS THE GREEN BARS BEGAN TO GROW OVER THE LAST FIVE YEARS.
SPENDING HAS AVERAGED $322 MILLION PER YEAR.
YOU CAN SEE THAT IN THE NEXT FIVE YEARS, OUR AVERAGE INVESTMENT INCREASES TO $402 MILLION PER YEAR.
TOTAL SPENDING DURING THIS FIVE YEAR PERIOD IS PROJECTED TO BE ALMOST $2 BILLION, WHILE STILL FA HEAVILY FOCUSED ON WASTEWATER.
WE ARE ALSO DOUBLING THE NORMAL WATER DELIVERY, WHICH MEANS OUR PIPELINES AND OUR PUMP STATIONS.
AS ROBERT ROBERT MENTIONED, WATER SUPPLY SPENDING BECOMES MINIMAL AS WE BRING ON VISTA RIDGE.
HERE'S AN OUTLINE OF THE INFRASTRUCTURE AREAS I'VE DISCUSSED IN THE SPECIFIC DOLLARS THAT WE ARE BUDGETING FOR IN 2018 AND 2019.
SO IN SUMMARY, SAS BELIEVES THAT WE ARE ADEQUATELY FUNDING TO MEET THE LONG-TERM VIABILITY FOR OUR WASTEWATER PIPES AND PLANTS AND OUR WATER FACILITIES.
THIS FUNDING REQUIREMENT WILL NOT END AND WILL LIKELY GROW AS THE SYSTEM CONTINUES TO GROW.
NOW THAT PROMISING TOOLS ARE AVAILABLE TO HELP US UNDERSTAND OUR WATER SYSTEM HEALTH, WE NEED TO MAXIMIZE THEIR USE.
THE WATER PIPELINE SYSTEM IS ESSENTIAL TO OUR CITY AND INCREASES IN FUNDING WILL BE REQUIRED IN THE FUTURE YEARS.
WE WILL WORK TO INCRE INCREMENTALLY INCREASE FUNDING FOR WATER PIPES AS WE INCORPORATE DATA FROM THE NEW ANALYTICAL TOOLS.
WE WANNA BE SURE WE ARE POSITIONING OUR SYSTEM FOR THE FUTURE WHILE BEING VERY COGNIZANT OF THE IMPACT OF THESE INVESTMENT ON OUR RATE PAYERS.
AT THIS TIME, I'D LIKE TO TURN THE PRESENTATION OVER TO DOUG EVANSON FOR THE FINANCIAL DISCUSSION.
UM, I'M GONNA GO OVER JUST TO GIVE YOU A QUICK BUDGET SUMMARY AS WELL AS TALK A LITTLE BIT ABOUT SOME OF OUR KEY FINANCIAL METRICS.
I KNOW THAT, UH, BEN AND CHERYL, UH, AND CITY STAFF DO A GREAT JOB OF MAINTAINING THE EXCELLENT CREDIT RATING THAT, UH, THE CITY OF SAN ANTONIO ENJOYS.
UM, WE OBVIOUSLY VERY IMPORTANT TO US AS WELL TO MAINTAIN A VERY SOLID CREDIT RATING AS WELL.
SO BEN ALREADY KIND OF WENT OVER THIS, SO I'M NOT GONNA TOUCH MUCH ON IT.
I JUST WANNA MAKE TWO QUICK POINTS ABOUT KIND OF THAT LAST PIECE OF THE PIE THERE.
SURPLUS TRANSFERRED TO THE R AND R OR THE RENEWAL AND REPLACEMENT PROGRAM.
BASICALLY THAT AMOUNT OF THAT SURPLUS THAT IS TRANSFERRED TO THE R AND R FUND IS DIRECTLY CORRELATED TO OUR DEBT COVERAGE RATIO, WHICH I'M GONNA DISCUSS HERE IN JUST A MINUTE.
AND IT ALSO HAS BEEN MENTIONED, PROVIDES FUNDS NECESSARY TO CASH FUND A PORTION OF THE SUBSEQUENT YEAR'S CAPITAL IMPROVEMENT PROGRAM.
AND THAT'S VERY, VERY IMPORTANT FOR US, PARTICULARLY AS WE GO FORWARD, WHEN YOU HAVE $2 BILLION WORTH OF CAPITAL NEEDS COMING UP OVER THE NEXT FIVE YEARS, AS STEVE TALKED ABOUT.
SO JUST QUICKLY LOOKING AT, UH, OUR ACTUAL PROPOSED OPERATING BUDGET FOR THE YEAR 2018.
THE 2018 PROPOSED BUDGET TOTALS ABOUT $782 MILLION.
THE PIE CHART ON THE LEFT SUMMARIZES WHERE THE FUNDS WILL COME FROM WHILE THE PIE CHART, I'M SORRY, ON THE RIGHT, UM, SHOWS HOW THE FUNDS WILL BE USED.
BY FAR, YOU CAN SEE SAWS LARGEST SOURCE OF FUNDING IS PROVIDED BY THE AMOUNTS RECEIVED IN SAWS, MONTHLY WATER AND SEWER BILLINGS BASED ON SAWS CURRENT RATES.
WE PROJECT THAT WE WOULD GENERATE ABOUT $660 MILLION WORTH OF REVENUE DURING 2018.
THE ONLY ORGANIC GROWTH IN REVENUE THAT WE HAVE COMES FROM CUSTOMER CONNECTIONS.
THIS AMOUNT IS OFFSET TO SOME DEGREE BY REDUCTIONS IN USAGE PER CUSTOMER, LARGELY ATTRIBUTABLE TO OUR ONGOING CONSERVATION EFFORTS.
WHILE CUSTOMERS ARE PROJECTED TO INCREASE APPROXIMATELY 1.6% IN 2018, TOTAL WATER SOLD IS PROJECTED TO INCREASE LESS THAN 1%.
I TELL PEOPLE AGAIN, WHEN WE GO OUT AND TALK TO THE PEOPLE OUT IN THE COMMUNITY AND OTHERS, YOU KNOW THAT WE HAVE A UNIQUE BUSINESS MODEL.
ANY OF YOU BUSINESS OWNERS AROUND THE TABLE HERE, I'M SURE DON'T ACTIVELY ENCOURAGE ALL OF YOUR CUSTOMERS TO USE LESS OF YOUR PRODUCT.
THAT'S EXACTLY WHAT WE DO EACH AND EVERY DAY AND WE'RE PRETTY DARN GOOD AT IT.
SO, UM, WE HAVE DRIVEN DOWN AND CONTINUE TO DRIVE DOWN, UH, USAGE AND WE'LL TOUCH ON THAT A LITTLE BIT MORE HERE GOING
[00:40:01]
FORWARD.AS YOU CAN SEE, THE PROPOSED RATE ADJUSTMENTS FOR 2018 ARE PROJECTED TO GENERATE ANOTHER $36.3 MILLION.
AND FINALLY, A COUPLE LAST PIECES OF PIE.
NON-OPERATING INCOME SUCH AS INVESTMENT INCOME, INTEREST INCOME IS EXPECTED TO GENERATE ALMOST $13 MILLION WHILE IMPACT FEES COLLECTED FROM NEW DEVELOPMENT WILL CONTRIBUTE.
BEN MENTIONED THAT AS WELL ABOUT $73 MILLION IN 2018.
WHEN WE LOOK AT THE USES OF FUNDS, IT REFLECTS THE FLOW OF FUNDS THAT BEN TALKED ABOUT EARLIER, AS WELL AS ON THAT FIRST SLIDE THAT I HAVE, O AND M MAKES UP BY FAR THE BIGGEST PORTION AT ALMOST 340 MILLION OR 44% OF OUR USES OF FUNDS.
THE NEXT THREE SLICES OF THE PIE, THE RED, THE GREEN, AND THE PURPLE AGAIN, ALL RELATE TO OUR CAPITAL IMPROVEMENT PROGRAM.
THOSE REPRESENT 54% OF THE PIE.
AND IN 2018, AND AGAIN, SUPPORT OUR CAPITAL PROGRAM, 30% OR $236 MILLION WILL BE UTILIZED TO MEET OUR DEBT SERVICE REQUIREMENTS ON THE NEARLY $3 BILLION IN DEBT CURRENTLY.
AS WELL AS ANY NEW DEBT NECESSARY TO SUPPORT THE 2018 CAPITAL IMPROVEMENT PROGRAM.
ANOTHER 24% OR $188 MILLION FLOWS TO THAT RENEWAL AND REPLACEMENT FUND THAT WE'VE TALKED ABOUT AND DOES, AGAIN, PROVIDE CASH RESOURCES TO FUND A SIGNIFICANT PORTION OF OUR CAPITAL PROGRAM.
I'LL GET, I'LL DISCUSS THAT FURTHER IN JUST A MOMENT.
FINALLY, THE TRANSFER TO THE CITY IS PROJECTED TO BE 18.1 MILLION IN 2018.
LOOKING QUICKLY AT 2019, UM, YOU CAN SEE THAT THE PROPOSED BUDGET FOR 2019 WE'RE PROJECTING AN OVERALL INCREASE IN THE BUDGET OF ABOUT $27 MILLION.
WITH THAT AMOUNT BEING PROVIDED BY THE PROPOSED, UH, 2019 RATE ADJUSTMENT, WHICH IS PROJECTED TO GENERATE APPROXIMATELY $27.4 MILLION ON THE USES OF FUND SIDES.
YOU CAN SEE THAT O AND M COSTS ARE PROJECTED TO GROW ABOUT $7.6 MILLION BETWEEN 2018 AND 19, OR JUST OVER 2%, WHILE THE MOST SIGNIFICANT INCREASES IN DEBT SERVICE AND EXPENSES, WHICH IS IN PROJECTED TO INCREASE BY ALMOST $17 MILLION.
AGAIN, THAT INCREASE IS DIRECTLY ATTRIBUTABLE TO INCREASES IN PRINCIPAL AND INTEREST PAYMENTS RESULTING FROM ADDITIONAL BORROWINGS REQUIRED TO FUND OUR CAPITAL IMPROVEMENT PROGRAM.
AS THE INCREASE IN DEBT SERVICE AND EXPENSES IS THE PRIMARY DRIVER BEHIND BOTH THE 2018, IT'S THE ENTIRETY OF THE 2018 REQUEST IS DEDICATED TO THE CAPITAL IMPROVEMENT PROGRAM AND TWO THIRDS OF IT IS DEDICATED IN 19 TO THE CAPITAL IMPROVEMENT PROGRAM.
THE BULK OF MY REMARKS ARE GOING TO FOCUS ON THE FUNDING OF OUR CAPITAL PROGRAMS AND THE IMPORTANCE OF MAINTAINING A HIGH QUALITY CREDIT RATING IN ORDER TO MINIMIZE OUR BORROWING COSTS.
BEFORE I GO THERE, HOWEVER, I WANNA SPEND JUST A MINUTE TALKING ABOUT SOME OF THE INITIATIVES BEING SUPPORTED BY OUR O AND M EXPENDITURES IN BOTH 2018 AND 2019.
SO AS I KNOW YOU CAN APPRECIATE, SAS, ABSOLUTE HIGHEST PRIORITY IS THE PROVISION OF SAFE AND RELIABLE WATER AND SEWER SERVICES.
STEVE TALKED ABOUT THAT A LITTLE BIT TO THIS END, SAS PLANS TO INVEST $6.2 MILLION IN MEETING VARIOUS REGULATORY REQUIREMENTS DESIGNED TO ENSURE THIS VERY OBJECTIVE.
THIS INCLUDES $5 MILLION PER YEAR TO REHABILITATE EXISTING MANHOLES TO FURTHER REDUCE INFLOW AND INFILTRATION, INFLOW AND INFILTRATION INTO OUR WASTEWATER COLLECTION SYSTEM AS ONE OF THE PRIMARY DRIVERS OF SANITARY SEWER OVERFLOWS.
ADDITIONALLY, IN 2018, WE WILL CONDUCT A PILOT STUDY INVOLVING THE CREATION OF WETLANDS AT MITCHELL LAKE TO DEAL WITH DISCHARGES FROM THE LAKE, WHICH OCCURRED DURING SIGNIFICANT RAINFALL EVENTS.
AND FINALLY, WE ALSO ARE GONNA BE PLUGGING TWO OLD ABANDONED EDWARDS WELLS, WHICH, UH, YOU KNOW, WE NEED TO DO PERIODICALLY WHEN THESE THINGS, OTHERWISE YOU HAVE AN AVENUE THAT GETS DIRECTLY INTO THE AQUIFER.
WE INTEND TO CONTINUE THE PROGRAM STARTED IN 2016 TO UTILIZE CUTTING EDGE TECHNOLOGY TO INSPECT WATER PIPES TO DETERMINE THE CONDITION OF THOSE PIPES AND BETTER FOCUS OUR CAPITAL INVESTMENTS ON THE PIPES MOST IN NEED OF REPLACEMENT OR REHABILITATION, WHILE ALSO CONTINUING OUR EFFORTS WITH THE E A A TO IDENTIFY DIFFICULT TO DETECT LEAKS AND REPAIRING THEM, THEREBY REDUCING WATER LOSS.
WE'RE GONNA SPEND APPROXIMATELY FIVE, APPROXIMATELY $5 MILLION PER YEAR ON THOSE TWO PROGRAMS, THE 2018 AND 2019.
PROPOSED BUDGETS ALSO INCLUDE FUNDS FOR A NUMBER OF TECHNOLOGY ENHANCEMENTS.
YOU CAN SEE SOME OF THE, THOSE ENHANCEMENTS LISTED HERE.
THE BIGGEST INVESTMENTS STEVE TOUCHED ON JUST A LITTLE BIT IS, AGAIN, AUTOMATED METERING INFRASTRUCTURE OR A M I.
WE HAVE RECENTLY ENGAGED A CONSULTANT TO CONDUCT A BUSINESS CASE REVIEW OF A M I.
AGAIN, C P SS HAS A NETWORK THAT'S, THEY'VE ROLLED OUT ABOUT 85% OF THEIR NETWORK, UH, AND HAVE
[00:45:01]
THAT LAID OUT.WE'RE LOOKING AT WHETHER OR NOT IT MAKES SENSE FOR US TO PIGGYBACK ON THEIR EXISTING NETWORK AND IMPLEMENT OUR OWN A M I SYSTEM.
THE 2018 PROPOSED BUDGET INCLUDES 1.6 MILLION FOR AN A M I PILOT STUDY, AND THAT PILOT STUDY WILL BE DESIGNED TO DEMONSTRATE THE ACTUAL COSTS AND BENEFITS OF ROLLING OUT A M I ON A LARGE SCALE BASIS.
THE 2019 BUDGET INCLUDES $9 MILLION IN OPERATING COSTS AND $19 MILLION IN CAPITAL OF FUNDING ASSOCIATED WITH THE PROJECTED FIRST YEAR DEPLOYMENT OF SUCH A SYSTEM.
FINALLY, LAST BUT CERTAINLY NEVER LEASE SAWS PLANS TO CONTINUE TO FUND ITS ONGOING INVESTMENT IN AND COMMITMENT TO CONSERVATION IN ORDER TO ACHIEVE ADDITIONAL WATER SAVINGS.
THIS CHART SIMPLY SHOWS YOU THE LAST TWO YEARS OF ACTUAL SPENDING ON VARIOUS CONSERVATION ACTIVITIES AS WELL AS THE PLANNED LEVEL OF INVESTMENT FOR BOTH THIS YEAR AS WELL AS 2018 AND 2019.
AS YOU CAN SEE, WE REMAIN COMMITTED TO FUNDING ONGOING CONSERVATION ACTIVITIES AS THE SAVINGS GENERATED THROUGH THESE ACTIVITIES IS TRULY IS ONE OF SAWS CHEAPEST SOURCES OF SUPPLY.
UH, RELATIVE TO OUR CONSERVATION GOALS, YOU CAN SEE, UH, THIS IS OUTLINED IN OUR 2017 WATER MANAGEMENT PLAN.
YOU CAN SEE, UH, THAT OUR GOALS INCLUDE DRIVING DOWN OUR GALLONS PER CAPITA PER DAY IN A NORMAL PRECIPITATION YEAR FROM 124 G P C D TO 120, 110 G P C D BY APPROXIMATELY 20 20 25, WHICH IS MORE THAN A DECADE IN ADVANCE OF THE S SA TOMORROW GOALS ESTABLISHED JUST A FEW YEARS BACK.
OUR ULTIMATE G P C D GOAL IS 88, DRIVE IT DOWN TO 88 BY 2070, WHICH INCLUDES DRIVING DOWN THE RESIDENTIAL G P C D LEVELS BY APPROXIMATELY 28% OVER THAT TIME PERIOD.
SO WE ARE GONNA DEFINITELY CONTINUE TO FOCUS OUR EFFORTS ON CONSERVATION.
SO AS WE DISCUSSED PREVIOUSLY, THE NEED TO MAKE INVESTMENTS IN OUR WATER AND SEWER INFRASTRUCTURE IS THE PRIMARY REASON BEHIND OUR REQUESTED RATE ADJUSTMENTS FOR BOTH 2018 AND 2019.
SPECIFICALLY, IT IS OUR NEED TO BE ABLE TO SERVICE THE DEBT TO BE ISSUED TO MAKE THESE IMPROVEMENTS.
THAT IS THE DRIVING FORCE BEHIND THESE RATE REQUESTS.
THIS SLIDE SHOWS SAS CURRENT FIVE-YEAR C I P FUNDING PLAN, AND AS YOU CAN SEE, SAWS TARGETS TO CASH FUND APPROXIMATELY 50% OF OUR CAPITAL NEEDS.
THAT'S SOMETHING WE'VE COMMUNICATED TO THE RATING AGENCIES.
WE WOULD LIKE TO CASH FUND ROUGHLY 50% OF ALL CAPITAL IMPROVEMENTS.
HOWEVER, DUE TO THE SIZE OF THE FORECAST CAPITAL PLANS OVER THE NEXT FIVE YEARS, THAT FUNDING TARGET IS GONNA BE FAIRLY CHALLENGING TO MEET.
WE ARE CURRENTLY PROJECTING A FIVE-YEAR CASH FUNDING RATE OF APPROXIMATELY 43%, BUT WE HAVE COMMITTED TO WORK WITH BEN AND HIS STAFF TO EXPLORE WAYS TO POTENTIALLY INCREASE THIS CASH FUNDING PERCENTAGE.
IF WE CAN DO THAT, INCREASING THAT LEVEL OF THAT CASH FUNDING WILL ASSIST SAWS IN BOTH A MINIMIZING FUTURE RATE INCREASES AS WELL AS B STRENGTHENING SAWS OVERALL CREDIT METRICS.
SO WHAT ARE SOME OF THOSE CREDIT METRICS? UM, AS WE'RE PROJECTING TO THE NEED TO ISSUE MORE THAN $1 BILLION IN ADDITIONAL DEBT OVER THE NEXT FIVE YEARS TO FUND THOSE REQUIRED CAPITAL INVESTMENTS.
THE MAINTENANCE OF SAS HIGHEST EVER CREDIT RATINGS IS EXTREMELY IMPORTANT TO SASS AND WE ARE VERY FOCUSED ON MAINTAINING THAT RATING IF NOT IMPROVING.
SIMILAR TO THE CITY, THERE ARE CERTAIN KEY FINANCIAL METRICS THAT THE RATING AGENCIES DEEMED TO BE VERY IMPORTANT FOR ALL WATER AND SEWER CREDITS BEING A VERY CAPITAL INTENSIVE INDUSTRY, WHICH CAN HAVE FAIRLY WIDE REVENUE SWINGS AS A RESULT OF THINGS THAT ARE BEYOND OUR CONTROL, SUCH AS THE WEATHER.
LIQUIDITY, LEVERAGE AND DEBT COVERAGE ARE EXTREMELY IMPORTANT TO EACH OF MOODY'S, FITCH AND S AND P.
THIS CHART SIMPLY SHOWS THE LEVEL OF IMPORTANCE IN THE VARIOUS METRICS DETAILED FOR BOTH S AND P AND MOODY'S.
AND WHILE FITCH DOES NOT APPLY A SPECIFIC WEIGHTING TO THE DETAILED METRICS THEY HAVE BEEN IDENTIFIED.
EACH OF THE METRICS DETAILED THERE HAVE BEEN IDENTIFIED AS THREE OF THEIR KEY RATIOS THAT THEY ANALYZE IN EVALUATING THE CREDIT WORTHINESS OF A WATER AND SEWER PROVIDER.
SO TO DEMONSTRATE THE IMPORTANCE OF THIS RATE ADJUSTMENT ON SAWS CREDIT RATING, AND THEREFORE THE FUNDING OF ITS CAPITAL PROGRAM OVERALL.
THIS SLIDE HAS BEEN DESIGNED TO SHOW YOU THE IMPACT OF THIS REQUESTED RATE ADJUSTMENT ON SAWS PROJECTED DEBT COVERAGE RATIO, WHICH I PERSONALLY BELIEVE TO BE THE SINGLE MOST IMPORTANT FINANCIAL METRIC BY WHICH SAWS IS EVALUATED.
IN ORDER TO CALCULATE SAWS DEBT COVERAGE RATIO, YOU BEGIN BY SUBTRACTING CASH O AND M EXPENSES FROM GROSS REVENUES TO
[00:50:01]
MAKE A DETERMINATION OF SOMETHING REFERRED TO AS PLEDGED REVENUES.AND THEN YOU DIVIDE THAT SUM BY PROJECTED DEBT SERVICE LEVELS THAT RESULTS IN YOUR TOTAL BOND TO DEBT COVERAGE RATIO.
AS YOU CAN SEE THE TOTAL BOND TO DEBT SERVICE COVERAGE RATIO WITHOUT THE RATE ADJUSTMENT.
IF WE DIDN'T HAVE ANY RATE ADJUSTMENT, WE WOULD PROJECT IT TO BE ABOUT 1.42 TIMES WHILE WITH, WHILE WITH THE PROPOSED ADJUSTMENT IT IS PROJECTED TO BE 1.58 TIMES.
THIS MAY NOT SEEM LIKE MUCH, BUT I CAN TELL YOU THAT CONSISTENT MAINTENANCE OF A 1.42 TIMES DEBT COVERAGE WILL RESULT IN A RATINGS DOWNGRADE WHILE A RATIO OF 1.58 TIMES WHILE STILL SHORT OF OUR INTERNAL TARGET WOULD PROVIDE US THE OPPORTUNITY OF MAINTAINING OUR EXISTING RATING.
OBVIOUSLY WE'RE NOT REAL INTERESTED IN LEAVING THIS TO CHANCE, SO WE DO BUILD IN A LITTLE BIT OF CONSERVATISM BUILT INTO OUR DEBT SERVICE ASSUMPTIONS.
PRIMARILY, WE HAVE ASSUMED THAT WE WILL ISSUE ALL THE DEBT THAT WE PLAN TO ISSUE IN 2018 ON JANUARY 1ST, AND THEREFORE HAVE A FULL YEAR'S WORTH OF PRINCIPLE AND INTEREST PAYMENTS.
THIS IS NOT LIKELY TO BE THE CASE, SO WE ANTICIPATE BEING ABLE TO EXCEED OUR COVERAGE PROJECTIONS BETWEEN BY BETWEEN 0.1 AND 0.2.
SO YOU TAKE THAT 1.58 AND IF WE'RE ABLE TO DO 0.1 BETTER, WE'D BE AT 1.68 OR POSSIBLY EVEN 1.78.
AS YOU CAN SEE, IF WE DO OUTPERFORM OUR PROJECTIONS BY THAT AMOUNT, WE'LL BE VERY CLOSE TO MEETING THE DEBT COVERAGE TARGET THAT WE HAVE ESTABLISHED AND WHICH HAS BEEN COMMUNICATED TO THE RATING AGENCIES.
SO TO BEGIN WRAPPING UP MY PORTION OF THE BRIEFING AS ROBERT AND BOTH ROBERT AND BELIEVE STEVE MENTIONED AT THE BEGINNING OF OUR PRESENTATION, WE ARE SEEKING A RATE INCREASE OF 5.8% IN 2018 AND 4.7% IN 2019.
CURRENT PROJECTIONS SHOW THE NEED FOR ADDITIONAL RATE ADJUSTMENTS IN THE SUBSEQUENT THREE YEARS, LARGELY TO FUND THE VISTA RIDGE WATER SUPPLY PROJECT COMING ONLINE AS WELL AS TO CONTINUE TO MEET SAWS OBLIGATIONS UNDER THE CONSENT DECREE.
AS THOSE OF YOU WHO HAVE BEEN ON CITY COUNCIL FOR A FEW YEARS KNOW THE WATER SUPPLY PORTION OF THE 2020 RATE ADJUSTMENT HAS ALREADY BEEN PRE-APPROVED IN ORDER TO PROVIDE THE FUNDING CERTAINTY THAT WAS REQUIRED TO ENTER ENTER INTO THAT AGREEMENT.
THAT BEING SAID, WE ARE GOING TO WORK DILIGENTLY TO REDUCE AND HOPEFULLY ELIMINATE AT LEAST SOME OF THESE PROJECTED INCREASES AND LOOK FORWARD TO WORKING WITH BEN AND HIS STAFF AS WELL AS THIS COUNCIL TO DO EXACTLY THAT.
TWO OTHER THINGS THAT I QUICKLY NEED TO BRING TO YOUR ATTENTION.
IN OUR LAST RATE STUDY, IT WAS DETERMINED THAT RECYCLED WATER CUSTOMERS WOULD BEGIN TO BE ASSESSED RATE ADJUSTMENTS SIMILAR IN PERCENTAGE MAGNITUDE TO THOSE BEING IMPLEMENTED FOR POTABLE WATER CUSTOMERS.
AS A RESULT, RECYCLED WATER RATES ARE PROPOSED TO INCREASE BY 7.8% IN 2018 AND 1.8% IN 2019.
THE PERCENTAGES ARE DIFFERENT THAN THOSE WE'VE BEEN TALKING ABOUT BECAUSE WE WERE ONLY TALKING ABOUT WATER RATE ADJUSTMENTS.
SO WE TAKE THE WATER DELIVERY AND THE WA THE WATER SUPPLY INCREASE AND WE AVERAGE THOSE TWO AND THAT'S HOW WE DETERMINE WHAT THAT UH, RATE INCREASE IS GONNA BE FOR THE RECYCLE WATER.
UM, AGAIN, THERE'S NO WASTEWATER INCREASES BAKED INTO THOSE FIGURES, BUT AS YOU CAN SEE ON THIS SLIDE, RECYCLED WATER CUSTOMERS CURRENTLY PAY APPROXIMATELY 63% LESS THAN OUR OTHER GENERAL CLASS CUSTOMERS AND APPROXIMATELY 83% LESS THAN IRRIGATION CLASS CUSTOMERS.
SO BY IMPLEMENTING THESE RATE ADJUSTMENTS, THIS DIFFERENTIAL WILL NOT BECOME EVEN GREATER.
WE WANTED TO MAKE SURE THAT DIFF THAT DIFFERENTIAL DID NOT INCREASE FURTHER.
FINALLY, SAS CHARGES A NUMBER OF MISCELLANEOUS FEES TO RECOVER THE COST OF PROVIDING SPECIFIC SERVICES.
WE HAVE PROVIDED TO BEN AND HIS STAFF A LIST OF THE SPECIAL SERVICE FEES THAT WE ARE PROPOSING TO CHANGE FOR 2018.
IN 2015, CITY COUNCIL APPROVED AN ORDINANCE ALLOWING FOR AN AUTOMATIC ADJUSTMENT TO CERTAIN FEES BASED ON CHANGES IN THE CONSUMER PRICE INDEX.
THESE FEES WILL BE AUTOMATICALLY ADJUSTED BY 1.73% DUE TO THE CHANGE IN C P I FROM LAST YEAR.
OTHER FEES ARE PERIODICALLY REVIEWED BY SAS STAFF TO DETERMINE IF A CHANGE IN THE COST TO PROVIDE THE SPECIFIC SERVICE HAS CHANGED.
MOST OF THESE FEES WERE LAST ADJUSTED IN 2012.
ANY CHANGES REPRESENT THE UPDATED COST TO PROVIDE THE SPECIFIC SERVICE.
IN TOTAL, THE PROPOSED CHANGES IN THE FEES WILL GENERATE AN ADDITIONAL $580,000 IN 2018.
THESE ADDITIONAL FUNDS HAVE BEEN PROGRAMMED TO PROVIDE, TO PROVIDE ADDITIONAL FUNDS FOR OUR CUSTOMER ASSISTANCE PROGRAMS. AND WITH THAT, I WANNA TURN IT BACK OVER TO ROBERT COUNCIL MEMBERS AND SUMMATION.
UM, I UNDERSTAND IT'S BEEN A, UM, TWO
[00:55:01]
VERY LENGTHY, UM, PRESENTATIONS, BUT UH, JUST TO LET YOU KNOW WHERE WE ARE IN 2017, WE'RE LOOKING AT A $62 AND 24 CENT BILL, UH, 2018 OR INCREASE BY $3 AND 45 CENTS.THAT'S ROUGHLY, UM, A LITTLE OVER A 10%, UH, RATE INCREASE.
UH, BUT EVEN WITH THESE ADJUSTMENTS, UH, IT LOOKS VERY FAVORABLE TO OUR PEER CITIES OR, UH, OTHER LARGEST, UH, LARGE CITIES IN IN TEXAS.
UH, I WILL NOTE THAT NONE OF THESE CITIES HAVE AN AGREEMENT WITH E P A WITH ADJUSTED DEPARTMENT ON A CONSENT DECREE.
SO YOU'LL PROBABLY SEE THE RATES OF THESE CITIES SIGNIFICANTLY GO UP ONCE THEY HAVE THEIR AGREEMENT.
AND HOUSTON WAS PROBABLY WITHIN WEEKS, IF NOT DAYS OF AN AGREEMENT UNTIL HURRICANE HARVEY HIT, AND THAT KIND OF PUSHED THAT BACK FOR A, FOR WHATEVER LENGTH OF TIME.
UH, THIS SLIDE SHOWS YOU THAT OVER TIME SAUCE HAS KEPT ITS INCREASES, UM, AS MINIMAL AS POSSIBLE.
IN 2005, CUSTOMERS PAID ABOUT SA CUSTOMERS PAID ABOUT $4 BELOW THE AVERAGE OF THOSE CITIES, AND TODAY THAT AVERAGE IS ABOUT 20 DO $20 BELOW THE, THE SAME FOUR CITIES AT THE SAME TIME, WE RECOGNIZE THAT ANY ADDITIONAL RATE ADJUSTMENT IS VERY HARD ON A PART OF OUR COMMUNITY.
SO THAT'S WHY WE'RE INCREASING FUNDING TO ALL OF OUR CUSTOMER ASSISTANCE PROGRAMS. THESE PROGRAMS LISTED HERE WILL PROVIDE, UH, HELP TO THESE INDIVIDUALS, TO THESE FAMILIES AND MAKE SURE THAT THEY HAVE THIS, UH, BASIC NECESSITY COMING INTO THEIR HOMES.
UH, WE HAVE INCREASED THE NUMBER OVER 50 PER 50% OVER THE LAST FEW YEARS WHERE, WHERE WE HAVE OVER 25,000 CUSTOMERS AND THAT'S A A, THAT'S A CONNECTION.
SO IF YOU CAN MULTIPLY THAT BY THE INDIVIDUALS THAT LIVE IN THAT HOME, 25,000 FAMILIES THAT ARE REALLY HELPED IN THIS ENDEAVOR.
THE OUTREACH THAT WE'RE DOING, UH, IS, UH, THE SAME THAT WE'VE DONE THE LAST FEW YEARS AND THAT'S GOING OUT IN THE COMMUNITY INTO YOUR TOWN HALL MEETINGS, UH, YOUR NEIGHBORHOOD ASSOCIATION MEETINGS, ANY GROUPS OF INDIVIDUALS THAT YOU WANT US TO GO TO, BUT ALSO SOCIAL MEDIA, UH, LIVE, UH, LIVE, UH, FACEBOOK.
UH, DISCUSSION WILL BE HELD ON NOVEMBER 1ST.
OUR BOARD WILL LOOK AT THIS ISSUE AND HOPEFULLY VOTE AFFIRMATIVELY ON NOVEMBER 7TH, WILL BE BACK IN FRONT OF YOU ON NOVEMBER 9TH.
AND IF, UH, WE HAVE AN AFFIRMATIVE VOTE FROM THIS COUNCIL, THESE RATES WILL TAKE EFFECT JANUARY 1ST.
MAYOR COUNCIL MEMBERS, I AND MY TEAM STAND BEFORE YOU.
WE WOULD LOVE TO TAKE ANY QUESTIONS THAT YOU MAY HAVE.
AND, UM, AS I STATED AT THE BOARD MEETING THE OTHER DAY, THIS IS A, UH, VERY MUCH AN INFRASTRUCTURE BUDGET FOR FOR SAWS AND WE DO HAVE OBLIGATIONS TO OUR SEWER SYSTEM, UH, THAT IS UNDER CONSENT DECREE.
AND IF THERE'S A LESSON TO BE LEARNED FROM THAT CONSENT DECREE IS THAT IF WE TAKE OUR EYE OFF THE BALL OF MAINTAINING INFRASTRUCTURE, WE'RE GONNA PAY A PAR FAR MORE SIGNIFICANT COSTS THAN IT, THAN WE WOULD OTHERWISE.
AND WE DEAL THE SAME WAY IN A FISCALLY RESPONSIBLE MANNER WITH THE INFRASTRUCTURE UNDER OUR DIRECT CONTROL OF THE CITY.
UH, WHICH IS WHY I URGED THE BOARD AND THE STAFF TO REALLY LOOK AT ITS CAPITAL BUDGET.
WITH REGARD TO WATER LINE INFRASTRUCTURE, THE WHOLE CONVERSATION IN SAN ANTONIO RECENTLY HAS BEEN ABOUT SEWER SYSTEM INFRASTRUCTURE, BUT WE DO KNOW THAT WE HAVE CHALLENGES WITH THE ACTUAL WATER MAINS THAT ARE THROUGHOUT A CITY THAT'S NOW 300 YEARS OLD, UH, WHICH IS WHY YOU'RE SEEING A, UH, RATE INCREASE THAT'S SLIGHTLY ABOVE THE INITIAL PROJECTION OF 5.3%, WHICH IS NOW 5.8%.
UM, I DON'T HAVE ANY QUESTIONS BECAUSE WE DID DRILL DOWN INTO THIS, UH, WITH, UH, THE BOARD.
UH, BUT I DO TAKE NOTE OBVIOUSLY THAT WE HAVE OUR FINANCIAL WIZ ON THIS, UM, IN HIS CAPACITY AS OUR UTILITY MANAGER, UH, BEN GO.
AND I BEN, UM, JUST SO I'M CLEAR, AFTER HAVING REVIEWED THE SAWS FINANCIALS, IS IT YOUR RECOMMENDATION THAT WE MOVE FORWARD WITH THE PROPOSAL? UH, YES IT IS MAYOR.
AND I'VE GOT JUST A COUPLE OF SLIDES I CAN GO OVER REAL QUICK.
I DON'T WANNA REPEAT MUCH OF WHAT SAW HAS ALREADY WENT OVER WITH YOU.
THEY'VE KIND OF GONE OVER THE DATA IN THE BUSINESS CASE.
I CAN TALK A LITTLE BIT ABOUT THE REVIEW PROCESS THAT WE WENT THROUGH AND WHAT OUR CONCLUSION IS.
UM, SHOULD TAKE JUST, UH, THREE OR FOUR SLIDES.
SO AS YOU MENTIONED UNDER THE CHARTER, WE DO HAVE, UH, A RESPONSIBILITY FOR REVIEWING REQUESTS THAT COME IN FROM OUR CITY OWNED UTILITIES AS IT RELATES TO REQUESTS OR FOR OUR RATE INCREASES.
AND WE'VE ACTUALLY GOT A GROUP WITHIN THE FINANCE DEPARTMENT THAT WORKS WITH THE UTILITY ON POLICY ISSUES AND ON THESE RATE REQUEST REVIEWS.
SO TR TRAIL ELLIOTT'S, OUR DEPUTY, UH, C F O, RUSSELL HUFF IS THE ASSISTANT DIRECTOR OVER THAT AREA.
THEY'VE GOT A TEAM OF STAFF THAT WORK WITH SAWS, UM, TO REVIEW THESE
[01:00:01]
RATE CASES WHEN THEY COME IN.THIS SLIDE JUST KIND OF SUMMARIZES SOME OF THE MAJOR AREAS THAT WE LOOK AT WHEN WE GET ONE OF THESE REQUESTS.
AND YOU KNOW WHAT I'LL HIGHLIGHT HERE IS WHAT WE'RE LOOKING FOR IS, IS THE RATE REQUEST REASONABLE WHEN WE LOOK AT ALL OF THESE CATEGORIES.
AND SO FOR EXAMPLE, WHEN WE LOOK AT SOMETHING LIKE THE OPERATIONS AND MAINTENANCE SIDE OF THE HOUSE OR THE BUDGET THERE, YOU KNOW, WE'LL LOOK AT SOME BENCHMARKING AGAINST OTHER UTILITIES.
THERE'S ABOUT 12 OR 13 OTHER UTILITIES THAT WE BENCHMARK THEM AGAINST.
WE'LL LOOK AT METRICS LIKE, YOU KNOW, CUSTOMER CONNECTION PER EMPLOYEE OR THE OPERATIONS AND MAINTENANCE EXPENSE PER, UM, PER CONNECTION.
SOME OF THOSE KINDS OF METRICS.
WHAT WE DON'T DO IS WE DON'T GO IN AND DO DETAILED BUSINESS PROCESS KIND OF EFFICIENCY REVIEWS.
SO SOMETIMES AS YOU SEE AS WE GO THROUGH OUR BUDGET PROCESS, OR WE'RE WORKING THROUGH OUR DEPARTMENT OF INNOVATION, WE'LL TAKE A DEEP DIVE INTO AN AREA AND WE'LL RECOMMEND CHANGES THAT RELATES TO EFFICIENCIES OR CHANGES.
WE'RE LOOKING MORE FOR ARE THE COSTS REASONABLE? ARE THEY IN LINE WITH, WITH SOME OF THEIR PEERS? WE DO LOOK AT BENEFIT LEVELS, THINGS LIKE, UM, HEALTHCARE PENSION.
WE MADE, UH, UH, RECOMMENDATIONS FOUR OR FIVE YEARS AGO FOR THEM TO REALLY LOOK AT THOSE AREAS.
THEY'VE MADE A LOT OF CHANGES AROUND THEIR PENSION PLANS AND THEIR HEALTHCARE PLANS TO BRING DOWN THOSE COSTS.
AND THEN WE LOOK AT IN AGGREGATE, KIND OF WHAT THEY'RE RECOMMENDING AS IT RELATES TO SALARY.
WHAT KIND OF POOL ARE THEY PUTTING IN PLACE FOR PERFORMANCE PAY? UM, ANY KINDA LIVING WAGE ADJUSTMENTS, THOSE KINDS OF THINGS.
CAPITAL PROGRAM, LOOKING AT THE PACE AND EXPENDITURE OF THEIR BOND PROCEEDS AS THEY ISSUE DEBT TO FUND THEIR PROJECTS.
ARE THEY MOVING THAT CASH OUT? ARE THEY, ARE THEY APPLYING IT TO THOSE PROJECTS? ARE THEY ABLE TO EXPEDITIOUSLY, EXPEDITIOUSLY MOVE THOSE DOLLARS? WE LOOK AT THE, UH, C I P TO SEE IF IT ALIGNS WITH THE MAJOR THINGS LIKE THE E P A CONSENT DECREE, WHERE AS THEY DO AND COMPLETE THE O AND M ASSESSMENTS AND COSTS THERE AND MOVE MORE INTO THE CAPITAL CONSTRUCTION.
DOES THAT LINE UP WITH THE CAPITAL PLAN THEY PROPOSE? THEY DO ALLOW US THE STAFF TO SIT IN AND KIND OF LISTEN TO THEIR PRIORITIZATION PROCESS.
SO AS THEY'RE DEFINING THEIR FIVE-YEAR CAPITAL PLAN, HOW DO THEY SELECT THOSE MAJOR INFRASTRUCTURE PROJECTS THAT THEY WANNA FOCUS ON? THE CASH FLOW MODEL IS REALLY JUST AN ECONOMIC OR A FINANCIAL RATE MODEL.
UM, IT'S A, IT'S A LONG RANGE, UM, UH, TOOL THAT LETS US LOOK OUT INTO THE FUTURE AS WELL.
WE DO MAKE SURE THAT TIES INTO THEIR LATEST FINANCIAL AUDIT, WHICH WOULD'VE BEEN FOR THIS CASE CALENDAR YEAR 2016.
UM, WE LOOK AT THE KEY FINANCIAL METRICS, MANY OF WHICH DOUG JUST TOUCHED ON.
THINGS LIKE DAYS, CASH ON HAND, DEBT SERVICE COVERAGE, HOW MUCH DEBT, HOW MUCH EQUITY, HOW MUCH CASH ARE THEY USING TO FUND THEIR C I P.
UM, ALL THAT TIES INTO, OF COURSE, THE ULTIMATE, UH, RATING THAT THEY WILL GET, AND THAT'S GONNA TIE INTO THE COST OF FUNDS THAT THEY'RE GOING TO PAY EVERY TIME THEY ISSUE DEBT.
WE LOOK AT ASSUMPTIONS AROUND THE DEMAND USAGE, INTEREST RATES, GROWTH, GROWTH, UH, PROJECTIONS, AND THEN THE OVERALL FINANCIAL POSITION OF THE UTILITY.
WE LOOK AT, UM, D E P A CONSENT DECREE, SO THERE ARE MAJOR MILESTONES THERE.
THEY DO PROVIDE THE CITY A QUARTERLY REPORT TO TALK ABOUT THEIR PROGRESS IN TERMS OF MEETING THE REQUIREMENTS OF THAT E P A CONSENT DECREE.
THOSE OF YOU THAT HAVE BEEN ON THE COUNCIL BEFORE KNOW THAT THAT'S A, A, A LARGE ENDEAVOR WITH MANY MILESTONES.
SO WE'RE LOOKING AT THOSE QUARTERLY REPORTS TO MAKE SURE IT LOOKS LIKE THEY'RE ON TRACK TO DO THAT.
UM, IN TERMS OF CUSTOMER SERVICE, WE DIDN'T SPEND AS MUCH TIME IN THIS AREA AS WE DID A COUPLE YEARS AGO WHEN THEY HAD SOME OF THE BILLING ISSUES, BUT WE DID LOOK AT JUST SOME BENCHMARKS AROUND ANSWER RATE, ABANDONED CALL RATES, BILL ESTIMATIONS.
UM, ALL OF THOSE TRENDS WERE PO UH, PO UH, TRENDING POSITIVELY ON THE AFFORDABILITY SIDE.
UM, JUST LOOKING AT DID THEY MAKE ANY CHANGES TO THE PROGRAMS? THEY DID INCREASE THE FUNDING, AS DOUG MENTIONED FOR THE, UH, AFFORDABILITY DISCOUNT PROGRAM.
THEY ARE PROJECTING AN INCREASED ENROLLMENT THERE IN TERMS OF THOSE PARTICIPATING IN THAT PROGRAM.
AND THEN WE LOOK AT RATINGS AND WE LOOK AT RATING PUBLICATIONS THAT ARE MORE GENERAL FOR WATER WASTEWATER UTILITIES, JUST TO SEE WHAT, WHAT ARE THE TRENDS OVERALL THAT THE RATING AGENCIES ARE LOOKING AT FOR THESE TYPE OF ENTITIES.
AND THEN WE LOOK AT THE SAWS RATING REPORTS THEMSELVES.
WHAT ARE THOSE THINGS THAT ARE THE RATING AGENCIES ARE FOCUSED ON? WHAT DO THEY BELIEVE ARE THE IMPORTANT FINANCIAL METRICS? AND THEN WHEN THEY LOOK AT THE OUTLOOK IN TERMS OF SAWS RATING, WHAT ARE THE THINGS THAT THEY SEE AS CREDIT POSITIVE THINGS? WHAT DO THEY SEE AS CHALLENGES SO THAT WE CAN LOOK AT HOW SAWS IS BUILDING THOSE KINDS OF THINGS INTO THEIR RATE REQUESTS.
UM, AND THEN WE TAKE ALL OF THAT BASICALLY, AND AGAIN, TRY TO MAKE A DETERMINATION IS, IS THE RATE REQUEST REASONABLE? I'M NOT GONNA GO BACK THROUGH THIS SLIDE.
THEY'RE ASKING FOR APPROVAL FOR 2018, A RATE INCREASE OF 5.8% 2019 OF 4.7%.
UM, THE PROJECTIONS FROM 2020 TO 2022 ARE THERE, BUT OBVIOUSLY THE BIGGEST CHANGES IN 2020 WITH THE VISTA RIDGE WATER COMING IN, THAT'S GONNA BE A BIG OPERATIONS AND MAINTENANCE EXPENSE FOR THE UTILITY.
AND AS DOUG MENTIONED, PART OF THE STRATEGY IS TO BUILD ADDITIONAL CASH TO REALLY WORK ON, UM, THAT 2020 RATE INCREASE.
SO IF WE COULD SMOOTH THAT OUT TO SOME DEGREE, THAT WOULD BE THE THING THAT THEY WOULD BE FOCUSED ON OVER THE NEXT TWO YEARS.
IN TERMS OF OUR RECOMMENDATION, BASED ON ALL OF THAT WORK THAT WE DID, UM, WE BELIEVE THE RATE
[01:05:01]
REQUEST IS REASONABLE, AND WE WOULD RECOMMEND APPROVAL OF THE RATE INCREASE OF 5.8% FOR 2018, THE 4.7% INCREASE FOR 2019, AND THEN, UM, THOSE ADJUSTMENTS TO MISCELLANEOUS FEES AND RECYCLED, UH, WATER RATES.THAT WAS MENTIONED BY DOUG AS WELL.
UM, THE OTHER THING WE WOULD RECOMMEND, UH, FOR YOU ALL TO CONSIDER THAT WE'VE TALKED ABOUT PREVIOUSLY, BUT MAYBE NEED TO FORMALIZE A LITTLE BIT MORE, WOULD BE TO HAVE SAUCE COME IN PERIODICALLY AND C P S, UM, ON A MORE REGULAR BASIS.
AS YOU CAN KIND OF SEE GOING THROUGH THE PRESENTATION TODAY, THERE'S A LOT OF GROUND TO COVER.
I THINK IF WE WERE DOING A LITTLE MORE FREQUENT BRIEFINGS WITH YOU ALL ON MAYBE KEY POLICY ISSUES, IT MIGHT MAKE, UM, THESE PROCESSES GO A LITTLE BIT EASIER, UM, IN TERMS OF JUST BEING ABLE TO HAVE ADDITIONAL TIME TO DISCUSS THOSE KINDS OF POLICY ISSUES.
THIS NEXT SLIDE, UM, JUST LOOKS AT THE IMPACT ON OUR BUDGET.
SO IF YOU ALL WERE TO APPROVE THE 5.8% RATE INCREASE, IT WOULD GO INTO EFFECT JANUARY 1ST, 2018, AND THAT'S A PARTIAL FISCAL YEAR FOR US.
REMEMBER THAT SIZE IS ON A CALENDAR YEAR, FISCAL YEAR WHERE OCTOBER TO SEPTEMBER.
SO WE WOULD ONLY BE PICKING UP NINE MONTHS OF THAT.
SO THAT'S THE FIRST COLUMN THERE, $615,000 PROJECTED INCREASE IN REVENUE.
UM, WE DO HAVE, UH, OUR WATER WASTEWATER BILL AS WELL WOULD GO UP SLIGHTLY AT $72,000.
SO WE WOULD NET ABOUT $543,000 FOR 2018, AND THEN WE GAVE YOU A FULL 12 MONTH FIGURE THERE, UM, IN THAT LAST COLUMN.
SO WITH THAT MAYOR AND COUNCIL, THAT, UH, CONCLUDES OUR PRESENTATION, AND AGAIN, WE'D BE HAPPY TO ANSWER ANY QUESTIONS.
AND, AND THE ONLY OTHER THING I'D, I'D ADD IS AT THE, UH, PREVIOUS BOARD MEETING, UM, FOR SAWS, WE DID GET INTO A BIT OF A DISCUSSION, A COMPARISON OF, OF PEER CITIES AND THEIR MUNICIPAL UTILITIES, AND THERE'S A WIDE VARIABILITY OF THE CREDIT RATINGS OF EACH OF THOSE UTILITIES.
UH, THE ONE STANDOUT IN THE CLASS WOULD BE CHARLOTTE.
AND SO I'VE ASKED THE SAWS BOARD AND THE SAW STAFF TO DO A, A DEEP DIVE INTO CHARLOTTE, WHAT THEY'RE DOING RIGHT, WHAT WE'RE, WHAT, WHAT WE'RE NOT DOING THAT THEY'RE DOING, UH, AND VICE VERSA THAT WE POTENTIALLY COULD, UH, YOU KNOW, AGAIN, BOOST THE CREDIT, UH, RATING OF SAWS, WHICH, UH, IS NOT BAD.
IT'S INCREASED OVER THE LAST, UH, 10 YEARS OR SO, UH, BUT STILL IS NOT THE HIGHEST MARKS AS THE CITY HAS, HAS ACHIEVED.
AGAIN, THERE'S, THERE'S A WIDE VARIABILITY OF THAT, SO COGNIZANT THAT IT CAN HAPPEN OVERNIGHT, BUT, UH, THAT WOULD BE HELPFUL KNOWLEDGE IS WE MANAGE THE UTILITY FROM, FROM THIS SIDE AS WELL AS IN, INTO THE BOARD.
UM, THE OTHER THING ON, ON DISCLOSURE AND DISCUSSION OF COUNCIL ON THE OPERATIONS OF SAWS, YES, THIS IS IMPORTANT STUFF.
IT'S ALSO A LOT OF DENSE INFORMATION TO BE DOING ONCE OR TWICE A QUARTER EVEN.
SO WE'VE BEEN, MY STAFF HAS BEEN WORKING WITH CITY MANAGEMENT AS WELL AS THE BOARDS OF C P S AND SAWS TO COME UP WITH SOME ALTERNATIVES.
ONE OF THEM BEING DISCUSSED RIGHT NOW WOULD BE ON THE ALTERNATING THURSDAY AFTERNOONS, HAVING ALTERNATING SAWS AND C P SS BRIEFINGS FOR THE COUNCIL TO GO OVER THESE THINGS IN A LITTLE BIT MORE DEPTH.
UH, I KNOW WE TALKED BRIEFLY ABOUT THAT, ROBERT, BUT, UH, IT WOULD BE MY GOAL TO GET A LITTLE BIT FURTHER, UM, MORE DEPTH CONVERSATION WITH COUNCIL ON THESE ISSUES BECAUSE THEY'RE, YOU KNOW, SO INTER INTIMATELY RELATED TO OUR GROWTH PLANS AND AND SO FORTH.
I DON'T HAVE ANY QUESTIONS, ROBERT, UM, AND STAFF, UH, UH, DOUG, UH, STEVE, YOU'VE DONE VERY GOOD WORK TO, TO GET THIS PROPOSAL IN FRONT OF US.
SO I'LL MOVE NOW TO COUNCIL QUESTION.
UH, AND WE'LL START WITH COUNCIL TRAVINO.
MR. MAYOR, THIS IS THE, UH, SLIDE YOU'RE TALKING ABOUT WHERE CHARLOTTE IS.
SO WE'RE LOOKING AT THAT AND, UH, YOU THREW THE CHALLENGE OUT, AND WE'RE GOING TO FIND OUT HOW WE CAN MEET THAT.
UH, THANKS FOR THAT PRESENTATION AND, UH, CERTAINLY APPRECIATE ALL THE REGULAR UPDATES, AND I THINK THAT'S BEEN REALLY HELPFUL FOR ALL OF US.
UM, SO I, I JUST WANT TO TAKE THIS TIME TO REALLY TALK ABOUT THE, THE AFFORDABILITY PROGRAM.
UH, YOU AND I HAD THIS DISCUSSION, UM, AT OUR LAST MEETING REGARDING THE AFFORDABILITY PROGRAM.
AND SO, SO TALK JUST A LITTLE BIT MORE ABOUT, UM, YES, AS THE RATES INCREASE YEAR AFTER YEAR, HOW WE ARE, UH, ANTICIPATING GROWING OR MATCHING THESE FUNDS AND, AND HOW, HOW ARE WE MEETING OUR GOALS? UH, DO WE HAVE A STRATEGIC, UH, GOAL IN MIND AS FAR AS GETTING PEOPLE SIGNED UP FOR THESE AFFORDABILITY PROGRAMS? WELL, YOU KNOW, IT'S ALMOST LIKE IF WE, UM, DO NOT HAVE A GOAL BECAUSE WHAT WE HAVE TOLD GAVIN OAR, THE PERSON THAT RAMOS THAT'S IN CHARGE OF THAT, IS THAT IF HE NEEDS TO BUST THAT BUDGET, HE CAN BUST THAT BUDGET.
UH, AND AS A MATTER OF FACT, JUST ONE
[01:10:01]
OF THE GOALS THAT I PLACE ON HIM IS TO INCREASE THAT, UH, THAT NUMBER.AND SO IN TWO, UH, SHORT YEARS, HE HAS DOUBLED THAT, UH, THE AMOUNT OF INDIVIDUALS THAT HAVE SIGNED, WELL, FAMILIES THAT HAVE SIGNED UP TO THAT.
SO, AS YOU KNOW, WE'VE GONE INTO YOUR DISTRICT, UH, RAY SALDANA, UH, SHIRLEY GONZALEZ, AND HAVE, UM, EITHER BLOCKED, WALKED DOOR TO DOOR, GETTING PEOPLE TO SIGN UP, FAIRES ALONG WITH THE FOOD BANK, ALONG WITH SCHOOL DISTRICTS, UH, SENIOR CITIZEN KIND OF EVENTS, UM, WITH, UH, MARIACHIS AND, AND, UH, SONG AND FOOD AND, AND DISTRICT FIVE.
UH, AND SO IT'S NOT JUST LETTING THE PUBLIC KNOW THROUGH SOME KIND OF MEDIA THAT WE WANT YOU TO SIGN UP FOR THESE AFFORDABILITY PROGRAMS. IT'S VERY AGGRESSIVE, VERY HANDS-ON RECRUITMENT OF INDIVIDUALS OF FAMILIES TO GET ON THAT PROGRAM.
I, I THINK IT'S, IT'S, UH, A, A GREAT PROGRAM, AND THANK YOU.
YOU'RE, YOU'RE ABSOLUTELY RIGHT.
YOU'VE GONE ALONG ON A LOT OF OUR BLOCK WALKS AND, UH, SAWS IS ALWAYS VERY PRESENT IN A LOT OF OUR EVENTS.
WE DEFINITELY WANT TO MAKE SURE THAT, UH, WE'RE, WE'RE REACHING AS MANY FOLKS AS POSSIBLE.
AND I, I APPRECIATE YOUR, YOUR SENTIMENT ABOUT BREAKING THAT BUDGET, BECAUSE I, I THINK THIS IS, THIS IS ONE OF THOSE ITEMS THAT COMES UP A LOT, UH, IN MY DISTRICT.
AND, UM, YOU KNOW, WITH THAT, I, I GUESS I WOULD JUST SIMPLY ASK THAT, THAT, YOU KNOW, WE GET A, A REGULAR REPORT ABOUT WHERE WE ARE, WHERE DO WE STAND ON THAT, UM, AFFORDABILITY, UH, SIGN UP PER DISTRICT.
SO I, I THINK THAT WOULD BE REALLY, UH, CRITICAL AS, AS WE'RE MOVING PEOPLE FORWARD.
ANOTHER QUESTION WE, THAT WAS ASKED OF US IS, UM, YOU KNOW, THE, THE, THE APPLICATION OF, OF, OF THAT PROGRAM AND TO THOSE THAT FOLKS THAT ARE IN, IN APARTMENTS AND, AND IN OTHER, UH, SITUATIONS THAT THEY MAY NOT QUALIFY FOR.
SO HOW CAN WE EXPAND THAT AS WELL? WELL, THAT, THAT'S A, THAT'S A GOOD CHALLENGE.
UH, A LOT OF THE, UM, INDIVIDUALS OF MODEST MEANS HAVE TO LIVE IN APARTMENTS.
UH, THEY'RE, UH, NOT, THEY'RE RENTERS.
AND SO THE APARTMENT COMPLEX DOES NOT QUALIFY FOR THIS KIND OF ASSISTANCE.
IF THEY ARE RENTERS IN A SINGLE FAMILY RESIDENCE AND THEY HAVE THE WATER BILL IN THEIR NAME, THEY DO QUALIFY, AND WE DO ACTIVELY SEARCH THOSE OUT.
UM, BUT THE CHALLENGE IS TRYING TO HELP THOSE INDIVIDUALS, SO IF THEY PAY THEIR WATER BILL THROUGH THEIR RENT, UH, WE ARE OUT OF THAT LOOP, UH, THAT WHERE WE CAN HELP THEM.
BUT IF THEY ARE RESPONSIBLE FOR THAT BILL, WE DO SEE, SEARCH THEM OUT AND HELP THEM.
WELL, I MEAN, I THINK YOU POINTED OUT, YOU KNOW, THAT A LOT OF FOLKS THAT, THAT, THAT ARE REQUIRING THIS ARE, ARE, ARE, HAVE A VERY DIFFERENT LIVING CONDITION.
SO, UM, YOU KNOW, HOW CAN WE TRY TO EXPAND THE PROGRAM? AND I GUESS I WOULD JUST ASK YOU, I MEAN, I KNOW IT'S A CHALLENGE, BUT, UH, I GUESS THAT THAT WOULD BE MY CHALLENGE, UH, TO YOU AND TO GINO, UH, IS, IS HOW CAN WE LOOK AT THIS FOR RENTERS AND, UH, FOLKS MAYBE LIVING IN, IN, IN CERTAIN, UH, SITUATIONS THAT MAY DISQUALIFY THEM.
SO, UH, MAYBE WE CAN PILOT SOMETHING AND SEE WHAT, SEE WHAT WE CAN COME UP WITH.
OH, THIS IS PRETTY EARLY IN THE PROCESS HERE.
MAYBE I SHOULD DEFER TO OTHER COUNCILMEN.
BUT ANYWAY, NO, I'LL GO AHEAD AND GET STARTED.
UM, THANK YOU VERY MUCH FOR THE PRESENTATION.
A LOT OF GOOD DATA, BUT, UH, UH, I GOTTA TELL YOU, I WOULD, UH, YOU KNOW, THESE ARE A LOT OF NUMBERS AND JUST OVERALL NUMBERS AND, YOU KNOW, FOR ME TO, UM, SUPPORT ANY KIND OF RATE INCREASE, I, I'D REALLY NEED TO GET DOWN INTO THE WEEDS A LITTLE BIT MORE.
I MEAN, YOU'RE SHOWING NUMBERS, BUT I DON'T KNOW WHAT THOSE NUMBERS ARE GOING TO, IF IT'S FOR, YOU'RE SAYING REPLACEMENTS, BUT HOW MUCH OF A REPLACEMENT? WHAT, HOW MANY MILES OF LINE ARE WE GETTING OUTTA THE DEAL? HOW, HOW BIG OF PIPES, YOU KNOW, THAT KIND OF THING ACROSS THE CITY TO JUSTIFY, UH, THIS KIND OF A RATE INCREASE AND OUTTA THIS INCREASE.
UM, YOU KNOW, HOW MUCH OF IT IS TOWARDS OUR WASTEWATER SYSTEM VERSUS THE, THE, UH, WATER SUPPLY? BECAUSE I SEE IN THE, THE REHAB SPENDING, YOU HAD 22% FOR WATER PIPES AND 54% FOR WASTEWATER PIPES.
UH, WHY CAN'T WE STAY AT THAT SAME PERCENTAGE? AND WHY DO WE NEED AN ADDITIONAL INCREASE? WHY CAN'T WE JUST STAY THERE? UH, 6 46, THIS, IS THIS THE ONE? YES.
UM, THAT'S 18, 19 ON THE NEXT, UH, THAT GIVES YOU AN IDEA OF, OF WHERE THAT, UM, DOLLAR ESSENTIALLY IS GOING TO 55% FOR WATER DELIVERY, WHICH IS THE WATER PART OF THE SYSTEM, 24% FOR WATER, WASTEWATER WATER SUPPLY AT 21%.
[01:15:02]
UH, BUT YOU'RE ASKING WHETHER THESE CAN BE JUST, UH, SMOOTHED OUT.WELL, WHAT, WHAT WOULD THE IMPACT BE IF WE STAY AS IS NO INCREASE? UH, ABSOLUTELY NO INCREASE.
YEAH, NO INCREASE, NO, NO, UH, INCREASE OVERALL.
'CAUSE, UH, YOU KNOW, IN, IN MY BACKGROUND IN HISTORY, UM, YOU HAVE WHAT YOU CALL DEFERRED MAINTENANCE.
AND IF YOU DON'T HAVE AN INCREASE, IF YOU, UH, CONTINUE TO OPERATE AS IS, YOU JUST PUSH THAT TIMELINE OUT A LITTLE BIT FURTHER ON WHAT YOUR REQUIREMENTS ARE.
AND IT'S NOT, THIS IS NOT AN EXACT SCIENCE, AS YOU SAID.
NO, YOU KNOW, YOU DON'T KNOW HOW LONG A PIPE IS ACTUALLY GONNA LAST OUT THERE, AND YOU BASE IT ON, UH, STATISTICS ON BREAKAGES AND, YOU KNOW, HOW OLD THE PIPELINES ARE, THAT KIND OF THING.
SO, UM, I'M LOOKING AT RIGHT NOW, WE'RE, WE'RE GONNA GET A BIG INCREASE A COUPLE YEARS FROM NOW FOR THE VISTA RIDGE.
UM, THIS IS ALL PLAYING TOGETHER.
BEN IS SAYING WE NEED TO KIND OF BUILD UP OUR CASH AND WHAT HAVE YOU TO PLAN FOR THAT.
UM, YOU KNOW, WHAT I'M SEEING RIGHT NOW, I WOULDN'T SUPPORT ANY INCREASE AT THIS POINT, UH, AS IS THE 2018, UH, REQUEST IS ALMOST EXCLUSIVELY FOR CAPITAL.
SO THEY WOULD BE A, UH, SOME CAPITAL PROJECTS THAT WE WOULD JUST NOT DO BECAUSE WE WOULD NOT HAVE THAT RATE INCREASE.
NOW, DEFERRED MAINTENANCE, YES, WE ALREADY DO SOME DEFERRED MAINTENANCE, AND IT'S SOMETIMES IT'S, UH, UH, DEFERRED MAINTENANCE, AND YOU RUN IT TO FAIL.
SOMETIMES IT'S, YOU RUN IT RIGHT BEFORE IT FAILS.
UH, STEVE'S JOB IS TO FIND OUT, UH, WHICH, WHICH IS WHICH, AND MAKE SURE HE LETS US KNOW.
UH, BUT IT'S NOT, UH, COUNCILMAN, IT'S NOT AS IF, UH, WE, UM, HAVE NOT DONE, UH, ANY OF THIS BEFORE.
WHAT WE, WE DO UNDERSTAND, AND WE DO TAKE IT VERY, VERY SERIOUSLY, THE FACT THAT WE'RE COMING TO YOU AND COLLECTIVELY THIS BODY ASKING FOR MORE MONEY COMING OUT OF YOUR CONSTITUENTS, UH, POCKETS, WE TAKE THAT VERY SERIOUSLY.
SO WHAT WE WANT TO DO IS INVEST IN OUR, UH, SYSTEM, IN OUR, UM, UTILITY SO THAT FUTURE PROBLEMS DO NOT ARISE.
AND THAT'S WHAT HAPPENED IN THE 1990S AND EARLY TWO THOUSANDS WITH OUR SEWER SYSTEM.
WE CONCENTRATED SO MUCH ON GETTING ADDITIONAL WATER SUPPLY INTO THIS COMMUNITY AT THE EXPENSE OF THE WATER SYSTEM.
UNFORTUNATELY, UH, THIS COUNCIL AND A COUPLE OF COUNCILS PRIOR TO THIS, HAD TO PAY THE, THE, THE PIPER FOR THAT BY THE RATE INCREASES THAT WE HAD REGARDING THAT CONSENT DECREE.
SO WHAT WE'RE TRYING TO DO, AND WITH, UH, THE HELP OF, OF THIS PARTICULAR MAYOR AT OUR SEPTEMBER BOARD MEETING IS, UH, INSTRUCTIONS ON DON'T FALL BEHIND, STAY AHEAD OF THE CURVE, UH, INVEST NOW SO YOU DON'T HAVE TO PAY A WHOLE LOT MORE LATER.
WELL, IT'S NOT LIKE YOU HAVEN'T BEEN INVESTING IN THE, UH, WATER SUPPLY AND WASTEWATER SYSTEMS. I MEAN, EVERY YEAR, YOU'RE, I MEAN, ON SLIDE NUMBER THREE, IT SHOWS WHAT WE'VE BEEN INVESTING IN THESE SYSTEMS NOW AND, UM, IN THE PAST.
AND I DON'T, UH, UM, I GUESS I'M, I'M JUST NOT SEEING WHY WE NEED TO INCREASE OUR RATES BECAUSE WE HAVE BEEN INVESTING IN THESE SYSTEMS. MAYBE NOT AT THE LEVEL WE WOULD LIKE TO, BUT LEMME TELL YOU, THIS IS, THIS IS A CULMINATION OF AN ADDITIONAL FEE.
AGAIN, WE JUST HIT THE NEIGHBORS OUT THERE WITH A WASTEWATER FEE, YOU KNOW, AN INCREASE, RIGHT? WE DID THAT, WHAT, LAST MONTH, MONTH BEFORE LAST.
STORMWATER, I'M SORRY, STORMWATER FEE.
UH, HERE WE ARE WITH ADDITIONAL FEES, YOU KNOW, AND, AND IT GETS BACK TO, WE TALKED ABOUT A POTENTIAL ROLLBACK IN OUR TAXES OR HOMESTEAD EXEMPTION, UH, TO HELP OUR NEIGHBORS.
BUT, YOU KNOW, THAT WAS TALKED ABOUT, WELL, IT'S JUST NOT ENOUGH.
AND HERE WE ARE WITH ADDITIONAL FEES GOING IN THE OTHER WAY THAT I, UH, YOU KNOW, IT'S A, IT'S A DOUBLE WHAMMY ON OUR, ON OUR NEIGHBORS OUT HERE.
UM, I, I, I JUST DON'T, I DON'T THINK WE'RE READY FOR THAT.
AND, UH, YOU KNOW, I'M, RIGHT NOW, UNLESS I SEE A LOT MORE DETAIL ON WHAT WE'RE TALKING ABOUT HERE, I REALLY CAN'T SUPPORT THIS.
ESPECIALLY, YOU KNOW, HERE WE TALKED ABOUT A 4.9% RATE INCREASE HERE A WHILE BACK, IT WENT UP TO 5.3, AND NOW WE'RE UP TO 5.8.
YOU KNOW, UM, WE JUST KEEP SEEING THESE THINGS CLIMB.
AND I WANNA JUST POINT OUT THAT, UH, LET'S SEE, WHAT SLIDE AM I LOOKING FOR HERE? UH, WHERE'S THE SLIDE ON THE CONSERVATION SLIDE 31? YOU KNOW, THAT'S A GREAT SLIDE.
BUT I THINK TO BE TRANSPARENT, WE NEED TO SHOW WHAT OUR COSTS ARE ON OUR WATER SYSTEM.
YOU KNOW, WE'RE SHOWING A GREAT, UH, GREAT TREND LINE THERE THAT OUR NEIGHBORS ARE DOING CONSERVING, BUT WHAT ARE WE, WHAT ARE THEY GETTING PENALIZED ON? WHAT ARE, WHAT IS THE COST THAT, THAT LINE IS GONNA BE A TREND UP JUST OPPOSITE
[01:20:01]
OF WHAT THIS LINE IS SHOWING.SO MAYBE WE OUGHT TO PUT THAT LINE ON TOP OF THIS ONE SAYING, HEY, YOU'RE CONSERVING, BUT IT'S COSTING YOU MORE.
UH, IT SHOULD BE THE OTHER WAY AROUND.
WELL, UM, FIRST OF ALL, WHAT I HEARD IS THAT YOU WILL STILL GIVE US A CHANCE TO CONVINCE YOU, UH, OF WHAT WE'RE DOING.
AND SO WHAT I'D LIKE TO, YOU GAVE US A, A A TIME ALREADY TO BRIEF YOU BEFORE, LIKE ALL THE OTHER COUNCIL MEMBERS.
SO WE WILL DRILL DOWN AND GET YOU SOME OF THE INFORMATION ON THESE SPECIFIC PROJECTS, SPECIFIC TYPE OF MAINTENANCE ISSUES THAT WE HAVE, AND THE SYSTEM THAT WE HAVE IN ON.
DO NOT, NOT JUST MAINTENANCE, BUT REALLY REPLACEMENT.
UH, AND SO COUNCILMAN, UH, WE WILL GET THAT INFOR, I'LL SIT DOWN WITH YOU, GET THAT INFORMATION FOR YOU AND TRY TO CONVINCE YOU.
UH, YOU KNOW, THERE WAS, THERE WAS SOME MENTION ABOUT THIS ADDITIONAL, UH, 1 MILLION PEOPLE, BUT THAT'S NOT HAPPENING UNTIL, WELL, IT'S A GRADUAL INCREASE ALL THE WAY TO 2040, UH, WITH THOSE KIND OF NUMBERS.
ARE WE EXPECTING THESE KIND OF INCREASES FROM HERE ON OUT TILL 2040 TO, UH, COMPENSATE FOR THAT? WELL, IF, IF DOUG COULD PREDICT THAT, UH, I DON'T THINK HE'D BE WORKING AT SAAS.
HE WOULD, UH, BE WORKING IN LAS VEGAS SOMEWHERE.
UM, BUT, UH, YOU KNOW, YOU DID SEE OUR FIVE YEAR PROJECTION, UH, BINS, FIVE YEAR PROJECTION THAT WE, UH, INFORMATION THAT WE SUPPLIED TO HIM, UH, WE SEE, WE DO SEE NEEDS OUT THERE ON, ON INTO THAT, THAT TIME PERIOD.
ONE OF THE ONE ISSUES THAT YOU'RE VERY INVOLVED IN TRYING TO HELP US WITH THE LACKLAND AIR FORCE ISSUE, UH, THAT IF THERE'S EXPENDITURES IN THAT, THAT'S NOT TILL 20 23, 20 24.
SO, UH, WE DO SEE AT LEAST FOR THAT FIVE YEAR PERIOD, UH, WHAT THE NEEDS THAT WE SHOWED UP ON THE SCREEN.
AND WHAT IS OUR CREDIT RATING RIGHT NOW AT SAUCE? UM, STEVE, I MEAN, DOUG, IT'S AT OUR SENIOR LIEN RATING.
WHAT, AND I SAW THE SLIDE SHOWING THE OTHER ONES LIKE CHARLOTTE HAD THE AAA, OR IS THAT OUR GOAL? ARE WE TRYING TO GET TO AA? WHAT, WHAT WILL THAT COST US TO GET UP TO AA VERSUS AA? THAT'S AN EXCELLENT QUESTION.
SO WE'VE HAD THAT CONVERSATION.
I HAVE TALKED MORE ABOUT MAINTAINING 'CAUSE THERE IS A COST.
UH, MAYOR, YOU ASKED ABOUT, AND WE'LL GET SOME ADDITIONAL RESEARCH, BUT ONE OF THE FIRST THINGS I NOTICED WHEN I LOOKED AT CHARLOTTE, UH, COMPARED TO SAWS, OUR AVERAGE RESIDENTIAL BILL'S ROUGHLY $65, THEIRS IS ROUGHLY $84.
SO, UM, SO ONE OF THE WAYS YOU GET TO SOME OF THE COVERAGES THAT THEY HAVE, THEY HAD 2.6 TIMES DEBT COVERAGE, AND THEY HAD, UH, 900 PLUS DAYS CASH ON HAND.
THEY HAD THE METRICS TO SUPPORT THAT, BUT THERE IS A COST ASSOCIATED WITH THAT.
RIGHT NOW, I HAVE BEEN FOCUSED ON MAINTAINING OUR EXISTING CREDIT RATING, UH, NOT NECESSARILY INCREASING IT, BUT THERE IS SOME BENEFIT TO IT AS WELL TO INCREASE IT.
SO, YEAH, AND YOU KNOW, EVERY CITY IS DIFFERENT.
AND I, I KNOW YOU, YOU, UH, COMPARE OUR WATER RATES, UH, TO OTHER CITIES HERE IN TEXAS, AND YES, IT'S SHOWING A LITTLE BIT CHEAPER, BUT YOU KNOW, SAN ANTONIO IS SAN ANTONIO.
I REALLY DON'T CARE WHAT THE OTHER CITIES HAVE OUT THERE BECAUSE AUSTIN, FOR EXAMPLE, YOU HAVE, UH, UH, THINGS ARE MORE EXPENSIVE THERE IN AUSTIN THAN HERE IN SAN ANTONIO.
SO, UH, A LOT OF THOSE OTHER COMPARISONS THERE, UM, YOU KNOW, TO ME, I REALLY DON'T CARE ABOUT THOSE OTHER CITIES.
I'M CARING ABOUT SAN ANTONIO AND WHAT OUR NEIGHBORS AND RESIDENTS HERE ARE HAVING TO PAY ON A MONTHLY BASIS.
AND, UM, SIR, BE HAPPY TO SIT DOWN WITH YOU AND, AND SEE THE DETAILS THAT YOU'RE TALKING ABOUT.
BUT, UH, I WOULD, UH, I WOULD SAY WE HAVE HAD A PROGRAM OF REPLACEMENTS OF BOTH, UH, WASTEWATER AND, UH, WATER SUPPLY PIPES.
AND, AND I, I WOULD LIKE TO SEE WHAT IT DOES TO THAT TIMELINE TO STAY AS IS WITHOUT AN ADDITIONAL RATE INCREASE.
UH, WE'LL, WE'LL, UH, SIT DOWN AND TALK ABOUT IT.
UH, AT THE SOUND AT THE, I'LL GO ON THE RECORD NOW THAT COUNCILMAN PERRY AND I DID NOT COORDINATE THESE TALKING POINTS ANY WAY, SHAPE, OR FORM.
TODAY'S THE FIRST I'VE SEEN HIM IN A, IN A FEW DAYS.
SO, UM, YOU KNOW, I'M GONNA HAVE TO, I'M GONNA SECOND EVERYTHING ALMOST TO THE T THAT COUNCILMAN PERRY SAID, AND, UH, ADD IN A FEW THOUGHTS.
SO, UH, I HAVE GRAVE CONCERNS ABOUT ANY RATE INCREASE WHATSOEVER.
UH, AND, AND I'LL, I'LL GET INTO A LITTLE BIT OF SOME OF MY QUESTIONS AS TO THAT I WOULD LIKE ANSWERED GOING FORWARD IN THE FUTURE.
UH, BUT THIS GOES BACK TO THE LARGER CONVERSATION AND OF THE AMOUNT OF MONEY OVER SEVERAL DIFFERENT FEES.
UM, UTILITY RATE INCREASES, TAXES, UH, REAL ESTATE.
I MEAN, IT'S A LARGER CONVERSATION THAN JUST SAWS, RIGHT? IT IS A, UM, IT'S, IT'S A FAR BIGGER CONVERSATION WHEN WE LOOK AT EVERY DOLLAR THAT COMES OUT OF, UH, A RESIDENT'S CHECKBOOK.
AND, AND THAT'S WHAT I COMMITTED TO THE, THE, THE VOTERS OF DISTRICT SIX, WHICH IS THE RESIDENTS OF DISTRICT SIX, WAS
[01:25:01]
I WAS GOING TO ALWAYS SAY, UM, EVERY DOLLAR THAT THAT WE'RE GONNA SPEND, WE'RE GONNA PUT IT AT THE ABSOLUTE HIGHEST AND BEST USE TO THE CORE SERVICES OF WHAT WE WANNA ACCOMPLISH.NOW, WE ARE PULLING MONEY, UH, RIGHT AND LEFT FROM RESIDENTS.
AND I, I, EVERY TIME THIS COMES ALONG, I'M ALWAYS GONNA MENTION THIS, THAT IT'S TOO MUCH ALREADY ENOUGH'S ENOUGH.
AND IF WE DON'T, EVEN IF IT'S A DOLLAR, IF WE CAN'T FIGURE OUT HOW TO GIVE A DOLLAR BACK TO THE RESIDENTS OF SAN ANTONIO, WE'VE GOT BIGGER PROBLEMS, UH, THAN THAN JUST TRYING TO FIGURE OUT, YOU KNOW, I MEAN, BOND RATINGS AND, AND O AND M AND ALL THESE OTHER THINGS THAT, THAT WAS PRESENTED TO US TODAY.
IF WE CAN'T EVEN FIGURE OUT A WAY TO BE HUMBLE AND USEFUL WITH THE TAX DOLLARS AND REALIZE THAT AT ANY OPPORTUNITY, WE SHOULD GIVE IT BACK.
I MEAN, YOU KNOW, WE'VE HAD THIS DEBATE AND, AND THE COUNCIL, I'M GLAD HE MENTIONED IT AGAIN, WHICH IS, YOU KNOW, PROPERTY TAX RELIEF AND THOSE TYPES OF THINGS THAT WE CAN, IF WE'RE DOING THESE THINGS IN CONCERT, AND WE LOOK AT ALL OF THESE FEES AT TOGETHER AS A WHOLE, WE'RE GONNA HAVE A BETTER POLICY DRIVEN DISCUSSION WHEN WE TAKE 'EM INDIVIDUALLY.
UH, THE, WE'RE NOT DOING JUSTICE TO THE RESIDENT.
THE JUST THE RESIDENT DOESN'T LIVE IN THE REALM OF JUST THIS ONE RATE INCREASE.
THEY LIVE IN THE REALM OF EVERYTHING COMING OUTTA THEIR POCKET.
AND THAT, YOU KNOW, YOU HAVE A DOLLAR BILL UP THERE AND IT SHOWS THE PERCENTAGES AND THE, THE PIECES THAT ARE GOING TO, THAT'S WHAT A RESIDENT LOOKS LIKE, RIGHT? THEIR DOLLAR.
WHAT PERCENTAGE OF THAT DO THEY ACTUALLY GET TO TAKE HOME AND DO SOMETHING WITH? AND WHILE WE CAN LOOK AT THIS AND SAY, OH, IT'S ONLY SIX BUCKS A MONTH, UH, FOR A LOT OF OUR RESIDENTS, ESPECIALLY IN THE AREAS I REPRESENT FROM THE WEST SIDE IN EDGEWOOD, SIX BUCKS IS THE DIFFERENCE BETWEEN A DEDUCTIBLE ON THEIR, UH, ON THEIR MEDICATION FOR THE MONTH.
I MEAN, THAT'S WHAT IT COMES DOWN TO.
IT'S THE DIFFERENCE BETWEEN GAS MONEY BACK AND FORTH TO WORK FOR A WEEK.
I MEAN, THAT'S THE ENVIRONMENT AND WORLD THAT WE LIVE IN, AND THAT'S HALF THE DISTRICT.
I REPRESENT THAT KIND OF DIFFICULTY, UH, MATTERS, AND A DOLLAR HERE, A DOLLAR THERE, AND THEN YOU ADD 'EM UP ACROSS.
SO I'D ALWAYS WANNA CAUTION, UH, MY COLLEAGUES THAT THAT'S HOW I LOOK AT IT.
AND THAT'S, AND, AND COUNCILMAN PERRY, I'M GLAD YOU BROUGHT UP THAT IT'S A CUMULATIVE EFFORT.
AND, UM, AND WHILE I LOOK, THE PRESENTATION IS FANTASTIC, AND I GO ON RECORD RIGHT NOW, SAW I WAS IN THE SERVICE LEVEL TO THIS, THE COUNCIL OFFICE IS PHENOMENAL.
UH, I THINK THE WAY YOU REPRESENT YOURSELF, THE WAY YOU DEAL WITH US, UM, WHEN WE PICK UP THE PHONE, YOU ANSWER AND, AND THE SERVICE, THE SERVICE LEVEL'S EXCELLENT, RIGHT? BUT THIS COMES DOWN TO THE HARD CONVERSATION OF DOLLARS AND, AND HOW WE'RE GONNA DEFEND A TAXPAYER'S OPPORTUNITY, A RATE PAYER.
'CAUSE WE SHARE THE SAME PERSON RATE PAYER TAXPAYER.
HOW WE MAKE SURE EVERY DOLLAR MATTERS.
AND I'LL GIVE YOU AN EXAMPLE OF THINGS THAT CONCERN ME.
UH, SINCE 2012 IN THE AGGREGATE, WE'VE SEEN 33.77% RATE INCREASES.
NOW, DON'T FORGET, I WANNA REMIND MY PEERS, THESE AREN'T, THESE DON'T STAND ALONE.
SO IF YOU LOOK AT THE COMPOUNDING NATURE OF IT, WE'VE RAISED RATES SINCE 2012 AT A 38.58%.
SO IN THE TOTAL, IT'S ONLY 33.
BUT OVERALL, WHEN THEY'RE BUILDING AND LEANING ON EACH OTHER, IT'S ALMOST A 39% RATE INCREASE SINCE 2012.
NOW, WE TURN AROUND AND WE SAY, FROM HERE TO 2022, WE'RE GONNA RAISE THEM IN THE AGGREGATE 33.8%, WHICH IS GONNA END UP BEING ANOTHER 39 OR OR SO PERCENT IN COMPOUNDING NATURE.
SO IF YOU LOOK AT THOSE TWO, THAT'S ALMOST 75 TO 80% RATE INCREASES OVER A 10 YEAR PERIOD FROM HERE TO 2022.
NOW I GET WE HAVE TO POP INTO VISTA RIDGE, AND IT'S GONNA BE A, THAT'S GONNA BE A TOUGH DISCUSSION NO MATTER WHICH WAY WE GO ON THOSE RATE INCREASES.
BUT AN 80% RATE INCREASE OVER 10 YEARS, YOU KNOW, I'D BE ANXIOUS TO SEE, I THINK IT WOULD BE WORTHWHILE JUST, YOU SAID YOU WANT TO DELIVER INFORMATION AND, AND EARN SUPPORT.
LET'S TALK ABOUT THOSE RATE INCREASES IN ALL THE OTHER MUNICIPALITIES.
WELL, LIKE-MINDED MUNICIPALITIES.
I DON'T REALLY, I MEAN, WHAT CHARLOTTE DOES, OR AUSTIN, I DON'T KNOW, BUT I THINK IT IS FAIR TO HAVE A BENCHMARKING OF, OF WHAT OTHER MUNICIPALITIES ARE LOOKING LIKE.
'CAUSE TO ME, I SEE 80% OVER 10 YEARS, AND I THINK, WOW, I, I DON'T, AND IT'S JUST GONNA CONTINUE TO GET WORSE.
WHY TWO YEARS? WHY NOT JUST DO ONE YEAR SO WE CAN GO PIECE BY PIECE AND JUST, AND MEASURE IT AND HOLD YOU ACCOUNTABLE EVERY YEAR TO YOUR COMMITMENTS? UH, THE LAST COUPLE OF, UM, CYCLES, WE'VE GONE TWO YEARS.
AND IT, AND YOU DO HAVE THAT AUTHORITY.
YOU DO HAVE THAT, UH, OVERSIGHT O UH, OVER WHAT WE DO.
UH, BECAUSE EACH YEAR WE HAVE, UH, EVEN THOUGH WE GOT A TWO YEAR RATE INCREASE, WE HAVE COME BEFORE COUNCIL AND ESSENTIALLY, UH, HAVE DONE, WHAT I'M DOING RIGHT NOW IS PRESENT, UH, OUR BUDGET, OUR REVENUE REQUIREMENTS, UH, OUR EXPENDITURES TO THIS COUNCIL AND PRIOR COUNCILS.
AND, UH, EACH ONE HAS GONE THROUGH BEN GO'S OFFICE ALSO.
AND SO THAT'S, THAT'S JUST BEEN WHAT WE'RE, WHAT WE'RE, WHAT WE HAVE BEEN DOING.
AND THE OVERSIGHT IS ALWAYS THERE.
UH, THE ABILITY OF THE COUNCIL TO ADJUST THAT RATE INCREASE THAT THEY GA GAVE TO US PRIOR IS ALWAYS THERE.
SO IT'S NOT LIKE YOU'RE GIVING UP ANY KIND OF AUTHORITY OR ANY KIND OF, UH, OVERSIGHT ON US.
WELL, I WOULD LIKE TO, YOU KNOW, RECOMMEND WE HAR IF, IF WE'RE CONSIDERING ANY RAISE WHATSOEVER, THAT IT'S ONE YEAR AT A TIME.
I THINK WE'RE MOVING INTO THAT ENVIRONMENT NOW BECAUSE WE'RE COMING INTO MASSIVE
[01:30:01]
RATE INCREASES.AND THE RESIDENTS, HERE'S THE THING, THEY DON'T EVEN KNOW WHAT'S COMING.
I MEAN, WE HAVE A PUBLIC RELATIONS AND AN OPTICS AND NIGHTMARE STARING US IN THE GROUND WHEN WE HAVE TO GO OUT AND SELL AND TALK TO OUR RESIDENTS ABOUT THESE RATE INCREASES.
I DON'T KNOW HOW WE'RE GONNA HAVE THAT CONVERSATION IN 2020.
I MEAN, IT IS A, YOU KNOW, WE'RE LOOKING IN THIS IN A VERY SHORT PERIOD OF TIME, HAVING TO GO BACK AND TELL THEM THEIR, THEIR RATES ARE GOING UP DRASTICALLY.
SO I, I THINK IT NEEDS TO GO YEAR BY YEAR IF WE'RE EVEN REMOTELY CONSIDERING IT.
UH, WE HAVE TO HAVE TOUGH CONVERSATIONS EVERY YEAR BY RATE INCREASES.
BUT I THINK, UH, IT HAS TO BE HAD MUCH MORE FREQUENTLY.
WE WERE TALKING ABOUT COMING BACK AND DISCUSSING FREQUENTLY WITH THE COUNCIL.
WELL, THEN WE CAN DO IT AND COME BACK AND DEC AND DECIDE BASED ON YOUR 18 NUMBERS, WHAT YOU WARRANT IN A 19 PERSPECTIVE.
'CAUSE I FALL WITH THE COUNCILMAN, WITH COUNCILMAN PER ON THAT AS WELL WAS JUST, DON'T INCREASE YOUR BUDGET ANY LONGER.
I MEAN, RIDE WHERE YOU'RE AT, LIKE I'M LOOKING AT IT AND I SEE AN O AND M INCREASE OF, OF 3.26%.
LIKE I WOULD WANNA MAKE SURE THAT I, I'D ASK YOU, ARE YOU, HAVE YOU DONE AND SCRUBBED THAT BUDGET 100% IN YOUR OPERATIONS AND MAINTENANCE? 100%.
'CAUSE I NOTICED INCREASES IN MASSIVE INCREASES IN TRAVEL, UH, IN LARGE INCREASES IN CONFERENCES, LARGE INCREASES IN ALARM AND SECURITY, UNIFORM AND SHOE ALLOWANCE.
I MEAN, THESE ARE HUNDREDS OF THOUSANDS OF DOLLARS.
IT'S NOT MILLIONS, BUT THERE ARE INCREASES IN YOUR BUDGET THAT ARE OCCURRING.
SO I WOULD ASK YOU, HAVE YOU GONE THROUGH AND SCRUBBED EVERY BIT OF YOUR O AND M TO MAKE SURE YOU'VE SQUEEZED EVERY PENNY OUTTA THAT BEFORE YOU COME ASK FOR ANOTHER DOLLAR? YES, WE HAVE.
UH, BUT YES, UH, THE TRAVEL AND THE CONFERENCES THAT YOU'RE TALKING ABOUT, I SIGNED EVERY SINGLE, UH, REQUEST FOR TRAVEL, UH, OUT OF STATE.
ANY TIME ONE OF OUR EMPLOYEES WANTS TO GO TO A CONFERENCE, I KNOW ABOUT IT.
UH, THE VICE PRESIDENTS KNOW ABOUT IT.
THEY HAVE TO JUSTIFY IT TO ME, AND I'VE SIGNED OFF ON THEM.
BECAUSE I, I MEAN, IT LOOKS, IT'S, IT'S, YOUR O AND M HAS INCREASED.
I MEAN, I ACTUALLY DON'T HAVE THE EIGHT, THE 17 TO 18 NUMBERS YET.
BUT, YOU KNOW, YOU'RE LOOKING AT A SEVEN AND A HALF TO $9 MILLION INCREASE YEAR TO YEAR.
SO I WOULD ASK, IS IT POSSIBLE TO OP CONTINUE TO OPERATE AND HOLD YOUR BUDGET LINE THE SAME AND, UM, AND NOT INCREASE? I THINK THE COUNCILMAN MENTIONED THAT INITIALLY WHEN HE SAID, HEY, JUST HOLD YOUR LINE.
I THINK HE MENTIONED THAT DURING OUR BUDGET CONVERSATION TOO, WHERE HE RECOMMENDED, AS A COUNCIL, WE DON'T INCREASE THE BUDGET, WE JUST HOLD IT WHERE IT'S AT AND TRY TO LIVE WITHIN OUR MEANS.
SO, UH, YOU KNOW, I WOULD, I WOULD LIKE TO HAVE THAT CONVERSATION, RIGHT? LIKE, WHAT IS, UM, WHAT DOES IT LOOK LIKE TO NOT INCREASE YOUR O AND M AT ALL? AND THEN, BECAUSE I CAN'T EVEN TELL, 'CAUSE IF YOU GO TO SLIDE FIVE, UM, YOU'RE BARE, THE O AND M IS, I'M, I'M ASSUMING, BECAUSE LIKE I SAID, I'M, I'M A ROOKIE HERE, BUT THE O AND M IS WITHIN THOSE THREE CATEGORIES, CORRECT.
SO I DON'T REALLY KNOW WHAT THE O AND M IS VERSUS THE CAPITAL IN WATER SUPPLY, WATER DELIVERY AND WASTEWATER.
IS THAT A FAIR STATEMENT? UH, IT'S WITHIN THOSE NUMBERS, BUT I, BUT I, BUT WE DON'T, CAN YOU TELL US WHAT, AND IT DOESN'T HAVE TO BE NOW, BUT BECAUSE I CAN SEE, LOOK, IF THERE'S INFRASTRUCTURE ISSUES UNDER A CONSENT DECREE, THERE'S LEGAL RAMIFICATIONS.
THAT'S A DISCUSSION YOU AND I HAVE TALKED ABOUT THAT I CAN START TO SEE A FAIR CONVERSATION ON INFRASTRUCTURE NEEDS.
BUT THE O AND M IS A SEPARATE CONVERSATION ALTOGETHER.
SO DO YOU, CAN YOU PROVIDE US THOSE NUMBERS TO SHOW US WHAT THE SPLIT IS VERSUS INFRASTRUCTURE VERSUS O AND M? YEAH, BECAUSE THAT WOULD BE INTERESTING, RIGHT? 'CAUSE THEN WE COULD DEFINITELY LOWER THAT 5.8 IF WE SAID WE HOLD THE LINE ON O AND M, BUT WE CONCEDE AND CON AND, AND TAKE CARE OF OUR INFRASTRUCTURE ISSUES.
THE, THE 2018 RATE REQUEST IS CAPITAL.
CAPITAL 2019 IS ABOUT TWO THIRDS CAPITAL, ONE THIRD, UM, O AND M EXPENDITURES.
WELL, I WOULD LIKE TO KNOW WHETHER THAT 5.8% AND THAT 4.7%, WHAT PART IS O AND M ON BOTH EARS? I, WE WILL GET YOU THAT INFORMATION.
THAT WOULD BE, THAT WOULD BE A GOOD, UH, CONVERSATION POINT.
AND THEN, UM, WELL, THAT A, THAT ANSWER, I THINK WE GOT INTO BOTH OF 'EM.
SO I'LL JUST WRAP UP WITH THIS.
I, I THINK THAT I, I THINK WE REALLY DESERVES FURTHER CONVERSATION.
AND, UM, I, I, YOU KNOW, I, I'M INHERENTLY OPPOSED TO THE RATE INCREASE PERIOD.
IT'S A, IT'S A, IT'S A TALL, YOU KNOW, BAR FOR ME TO CLIMB, UH, BECAUSE I JUST, I'M, I'M JUST REALLY SICK AND TIRED OF THE AMOUNT OF MONEY COMING OUTTA TAXPAYER'S POCKET WITH NO CONCERN TO GIVE IT BACK.
AND HOW DO WE GET THERE, RIGHT? HOW DO WE FIGURE THIS OUT AND STOP ASKING AND START FIGURING OUT WAYS TO CORRECT THINGS.
AND I THINK WE'VE GOT THE WILLPOWER PEOPLE HAVE TALKED ABOUT IT.
I MEAN, WE'VE, WE'VE HAD GOOD DISCUSSIONS ON IT.
SO I LOOK FORWARD TO FUTURE OPPORTUNITIES TO FIGURE OUT A WAY TO PUT MONIES BACK INTO RESIDENTS.
BUT, YOU KNOW, WE GOTTA BE VERY CAREFUL.
AND, AND THE OPTICS BEHIND A LOT OF THE OPERATIONS AND THE THINGS WE'RE DOING, TWO YEAR INCREASES.
VISTA RIDGE, UM, 35, 30 4% RATE INCREASES.
AND WE ALL HAVE TO ANSWER FOR THAT.
AND THE NUMBER ONE RESPONSIBILITY YOU HAVE IS TO SPEND THE DOLLAR IN THE HIGHEST AND BEST USE.
THAT'S WHY IT'S IMPORTANT ON THE O M SPLIT VERSUS THE INFRASTRUCTURE SPLIT AND, AND THE DEFERRED MAINTENANCE PIECE.
I'D LIKE FURTHER INFORMATION ON, ON WHAT COUNCILMAN PERRY SAID, BUT I THINK ON THE WHOLE, UH, YOU KNOW, AT THIS POINT, I'M NOT INCLINED TO SUPPORT IT, UH, AT THIS RATE AMOUNT.
BUT I AM, I MEAN, I'M WILLING TO HAVE THE CONVERSATION DEFINITELY ABOUT, OKAY, WHERE ARE WE
[01:35:01]
ON THAT CONCENT DECREE? WHAT DO WE HAVE TO FIX RIGHT NOW? LIKE, WHAT ARE WE STARING DOWN INFRASTRUCTURE WISE THAT WE HAVE TO FIX THERE? THERE'S A, THERE'S A FAIR ARGUMENT THAT NEEDS TO HAPPEN BECAUSE IT'S A, IT'S A, IT'S AN ISSUE THAT'S CORE TO THE BUSINESS OF SAWS, BUT OUTSIDE OF THAT, WHERE CAN WE HOLD THE LINE AND REDUCE THOSE RATE INCREASES TO PROTECT HOMEOWNERS? SO THANK YOU.AND I, I DO APPRECIATE THE PRESENTATION'S.
VERY THOROUGH, AND THANK YOU TO THE TEAM.
UM, I THINK THE BEST WAY FOR ME TO, TO SORT OF START MY, MY, MY QUESTIONS, YOU KNOW, I'M GOING TO SORT OF DIG INTO SOME OF THE PIECES ON MAKING SURE THAT WE'RE, WE'RE BEING GENUINE WHEN WE SAY THAT WE ARE TAKING CARE OF THE MOST VULNERABLE AND AFFORDABILITY PROGRAM.
SO I'LL PROBABLY ASK A FEW QUESTIONS AROUND THAT, UH, ROBERT, BUT I JUST WANT TO SHARE WITH, UH, MY COLLEAGUES SOMETHING THAT, UM, I THINK ABOUT OFTEN
SO WHEN I WAS, UH, GROWING UP, I PLAYED A LOT OF BASEBALL.
I HAD THIS DREAM, I THINK LIKE EVERY BASEBALL PLAYER DOES WHEN THEY THINK ABOUT THEIR CAREER, THAT THEY'RE GONNA BE A MAJOR LEAGUE BASEBALL PLAYER, AND THAT IT'S GONNA BE THAT ONE MOMENT IN HIS CAREER WHERE HE'S AT THE COLLEGE WORLD SERIES.
IT'S THE BOTTOM OF THE NINTH, THREE, TWO COUNT.
YOU'RE UP AT THE PLATE GAMES ON THE LINE, AND YOU HIT A HOME RUN.
EVERYBODY CARRIES YOU OFF IN VICTORY ON THEIR SHOULDERS.
I'M, I'M NOT A MAJOR LEAGUE BASEBALL PLAYER, OBVIOUSLY, BUT I'M A CITY COUNCILMAN NOW.
BUT I HAVE THIS OTHER DREAM AS A CITY COUNCILMAN IN THIS CAREER.
THE DREAM IS I'M POURING OVER YOUR SAWS DATA.
I LOOK AT SOMETHING THAT IS SPOTTED NOT BY DOUG EVANSON, BUT IT'S ME.
AND I COME INTO THIS B SESSION AND I POINT OUT TO THE RECORD, YOU'RE ASKING ME FOR A RATE INCREASE.
AND I SAY, BUT YOU DIDN'T CATCH THIS ON PAGE 252.
YOU MISSED THE DECIMAL TREVINO FAINTS WITH ASTONISHMENT.
DOUG EVANSTON'S JAWS ON THE FLOOR,
THERE'S A TICKET PARADE BECAUSE I'VE SAVED THE RATE PAYERS SO MUCH MONEY BECAUSE I FOUND THIS ONE AMAZING THING THAT THEIR STAFF JUST DIDN'T SEE.
YOU KNOW, THERE'S A, THERE'S CLAPPING THROUGHOUT THE B SESSION.
I'VE HAD THIS DREAM FOR THE LAST SEVERAL YEARS, UH, ROBERT, THAT YOU'VE COME TO US WITH THE PROPOSED RATE INCREASE.
AND TO THE EXTENT THAT I'VE TRIED TO LOOK THROUGH AND OUTSMART YOUR WELL-PAID FOLKS WHO DO THIS FOR A LIVING, UH, IT HASN'T HAPPENED.
UM, IT'S NOT BECAUSE OF ANY LACK OF WILL WILLPOWER ON OUR PART TO TRY TO DO EVERYTHING WE CAN TO MAKE SURE THAT WE ARE BEING COGNIZANT OF OUR RATE PAYERS AND OUR COMMUNITY MEMBERS.
UH, SO I THINK WHAT I WANNA TALK ABOUT IS SOME, SOME REALITIES AROUND YOUR WORK.
UH, BECAUSE I THINK THE, THE, THE OTHER PLAN B IS SOMEHOW WE'RE JUST ABLE TO NOT DO THE RATE INCREASE, OR WE'RE ABLE TO DO A MORE REDUCED AMOUNT.
UH, THE WAY TO DO THAT IS THAT WE JUST PERHAPS LEAVE THIS TO A DIFFERENT COUNCIL TO TAKE CARE OF.
UH, I THINK THAT'S PROBABLY WHAT HAPPENED.
AND WHAT GOT US INTO SOME TROUBLE, UH, IN 2012 WHEN WE HAD TO SIGN A CONSENT DECREE IS THAT TOO MANY OF THE COUNCILS PREVIOUS TO US DIDN'T WANT TO DO THE TOUGH JOB OF HAVING TO PAY THE PIPER WHEN IT WAS DUE, WHEN INFRASTRUCTURE INVESTMENTS WERE NECESSARY.
SO FIRST QUESTION I HAVE IS, WHAT IS A CONSENT DECREE? BECAUSE I STILL SOMETIMES HAVE TROUBLE DESCRIBING THAT TO MY COMMUNITY MEMBERS.
'CAUSE WE'RE UNDER A CONSENT DECREE FROM THE FEDERAL GOVERNMENT.
UM, AND CONSENT IS A, A LOOSE WORD RIGHT THERE.
CONSENT ESSENTIALLY MEANS THAT WE HAVE AGREED, UH, WITH THE FEDERAL GOVERNMENT, E P A AND THE JUSTICE DEPARTMENT, UH, THROUGH A LAWSUIT THAT WAS FILED, UH, WITH THE, WITH THE FEDERAL COURT HERE IN SAN ANTONIO THAT ESSENTIALLY MANDATES IT'S A JUDICIAL, UH, DIRECTIVE, UH, UNDER PENALTIES OF A FEDERAL JUDGE THAT WE FIX CERTAIN THINGS IN OUR SYSTEM.
AND, AND OVERALL IT'S TO REDUCE, UH, SEWAGE THAT COMES OUT OF OUR SYSTEM, WHETHER IT'S A, UH, A MANHOLE OR A BREAK OR WHATEVER IT IS.
WHENEVER THERE'S A, EVEN A ONE GALLON SPILL OF SEWAGE, IT'S CONSIDERED A VIOLATION OF THE CLEAN WATER ACT.
AND SO THE GOAL IS TO REDUCE THOSE TO AS, UH, TO ZERO.
AND JUST LIKE A CITY CANNOT HAVE ZERO POTHOLES, WE HAVE, UH, 6,000 MILES OF SEWER LINE.
WE CAN'T NECESSARILY HAVE ZERO, UH, EMISSIONS OVER THAT PERIOD OF TIME.
SO IT IS AN AGREEMENT WITH THE FEDERAL GOVERNMENT THAT WE WILL SPEND, UH, $1.1 BILLION OVER A 10 YEAR PERIOD STARTING IN 2013 TO FIX THAT, UH, TO FIX OUR SEWER SYSTEM, TO GET 'EM TO A POINT WHERE, UH, THEY MEET THAT REQUIREMENT OF THE CLEAN WATER ACT.
SO I THINK THAT'S THE, THAT'S THE HISTORY THAT WE HAVE TO CONTEND WITH BECAUSE IN 2012 IS WHEN WE ALL HAD TO BE EDUCATED ON WHAT A CONSENT DECREE WAS.
AND, AND A LOT OF US DIDN'T WANT TO AGREE WITH YOU.
A LOT OF US SAID, WELL, LET'S JUST THUMB OUR NOSES TO THE CLEAN WATER ACT OR THE EPA A OR THE FEDERAL GOVERNMENT AND SAY, WE'RE NOT GONNA HAVE THIS RATE INCREASE THAT THEY'RE IMPOSING ON US.
AND WE SETTLED ON A NUMBER OF $1 BILLION THAT WE WOULD INVEST INTO OUR, OUR SEWER SYSTEM TO TRY TO PREVENT THE SANITAR SANITARY SEWER OVERFLOWS,
[01:40:01]
WHICH IS, YOU KNOW, MAYBE SOME COMMUNITY MIGHT SEE THAT THERE'S A, THERE'S A BACKUP AND THERE'S WATER FLOWING ABOVE THE WATER.SO WHAT IF WE DECIDED, LET'S JUST DUMB OUR NOSES AT THE CONSENT DECREE.
WHAT'S THE CONSEQUENCE OF THAT? UH, WELL, WE WOULD BE IN VIOLATION OF A FEDERAL, UH, ORDER.
THERE ARE STIPULATED PENALTIES IN THAT.
AND SO WE WOULD GET FINED PER DAY, PER OCCURRENCE, UH, PER SPILL.
UM, SO THAT, THAT'S THE BEGINNING OF THE CONSEQUENCES.
THE ULTIMATE CONSEQUENCE IS THAT THE FEDERAL GOVERNMENT FEELS YOU'RE NOT RUNNING IT CORRECTLY.
IT'S THE SAME, YOU KNOW, YOU, YOU TALKING ABOUT CONSENT DECREES FOR THIS PARTICULAR TYPE OF ISSUE, BUT THERE'S CONSENT DECREES ON OTHER ISSUES.
ALSO, FOR EXAMPLE, THE CITY OF FERGUSON ON, ON THEIR POLICE DEPARTMENT IS UNDER CONSENT DECREE.
FEDERAL GOVERNMENT HAS ESSENTIALLY TAKEN OVER THEIR POLICE DEPARTMENT.
THE FEDERAL GOVERNMENT WOULD TAKE OVER OUR SEWER SYSTEM.
SO THEY TAKE OVER THE REINS IF WE DECIDE THAT WE ARE NOT GOING TO IT TO GET TO THAT POINT.
I MEAN, THAT'S, THAT'S THE, SO THEY WOULD BE ABLE TO TAKE AWAY THE CONTROL OF THIS BODY TO SET A RATE INCREASE IF YOU NEED, UH, AND ESSENTIALLY YES.
AND, YOU KNOW, THE FINES WOULD ACCUMULATE AND THEY'RE, THEY'RE VERY, UH, UH, LARGE MONETARY FINES, AND THEY WOULD STILL MANDATE THAT YOU FIX WHERE YOU WERE SUPPOSED TO FIX.
YOU STILL HAVE TO DO WHAT YOU'RE, WHAT YOU, WHAT THEY'RE DEMANDING THAT YOU DO UNDER A PREVIOUS AGREEMENT, PLUS YOU GET FINED.
SO MAYBE DOUG CAN HELP ME WITH THIS ONE.
UM, BECAUSE WHAT WE REALIZED IN, IN 2012 WAS BECAUSE OF THIS CONSENT DECREE THAT WE HAD TO COME UP WITH, WHICH WAS A COMPROMISE, UH, WE WERE FIXED IN TO DO RATE INCREASES.
WHAT PORTION OF THIS WOULD BE ATTRIBUTED TO A CONSENT DECREE IN THIS RATE INCREASE? WHAT PERCENTAGE OF THIS RATE INCREASE? WELL, I SUPPOSE WE COULD LOOK AT THE HISTORY.
AND WE HAVE LOOKED AT THE HISTORY.
I KNOW COUNCILMAN COURAGE, FOR EXAMPLE, ASKED US OVER THE LAST 10 YEARS.
WE RESPONDED TO SOMETHING FOR HIM, AND I APOLOGIZE, I DIDN'T GET IT TO YOU YESTERDAY.
BUT, BUT BASICALLY WE'VE RAISED OUR RATES ON A COMPOUND ANNUAL GROWTH RATE ABOUT 4.2% A YEAR OVER THE LAST 10 YEARS.
AND I WOULD LOVE FOR THAT NOT TO BE THE CASE, BUT IT'S PRIMARILY DRIVEN BY THAT E P A CONSENT DECREE.
THAT BEING SAID, I'VE GOT TWO ARTICLES HERE IN FRONT OF ME.
THIS IS THE BLACK AND BEACH REPORT OF THE 50 LARGEST CITIES RATE SURVEY IN 2016.
AND IN THAT REPORT, THEY TALK ABOUT SINCE 2001, THE 50 LARGEST CITIES IN THE UNITED STATES HAVE RAISED RATES.
WATER RATES HAVE GONE UP AT A COMPOUND ANNUAL GROWTH RATE FOR THE LAST 15 YEARS OF 5.9%.
AND SEWER RATES HAVE GONE UP AT A COMPOUND ANNUAL GROWTH RATE OF 5.8%.
I WISH I COULD SAY IT WAS DIFFERENT, BUT IT IS AN INDUSTRY-WIDE PROBLEM.
THERE'S AN AGING INFRASTRUCTURE PROBLEM.
I'VE GOT ANOTHER REPORT HERE OF CIRCLE OF BLUE IS ANOTHER ONE, AND THEY ONLY GO BACK TO 2010, BUT OVER THE LAST 10, SINCE 2010, THEY'VE HAD COMPOUND ANNUAL GROWTH RATES OF 6% IN THE 30 LARGEST CITIES THAT THEY SURVEY AS WELL.
SO, UM, SO IT IS, I, THE CONSENT DECREE IS BY FAR THE LARGEST DRIVER.
I GAVE A PRESENTATION TO OUR BOARD WHERE WE TALKED ABOUT WHAT HAS HAPPENED TO PEOPLE'S WATER BILLS AND, AND WASTEWATER BILLS.
AND THE WASTEWATER BILL IS THE PRIMARY DRIVER.
IT'S GONE UP MORE THAN 5% A YEAR FOR THE LAST, SINCE 2009.
WOULD YOU, WOULD YOU ATTRIBUTE THAT TO THE, THE CONSENT DECREE? WOULD YOU ATTRIBUTE THAT TO JUST THE NEGLECT ON SAWS OR THE WATER BOARD BEFORE? NOT I WOULD PAYING ATTENTION TO THE WATERS WASTEWATER.
I WOULD SUGGEST THAT IT'S ALMOST ENTIRELY ATTRIBUTABLE TO THE, TO THE CONSENT DECREE.
WE'VE HAD TO INVEST SIGNIFICANT, AND STEVE SHOWED YOU SOME OF THOSE NUMBERS, BUT SIGNIFICANTLY MORE INTO OUR WASTEWATER COLLECTION SYSTEM THAN WE WERE PREVIOUSLY.
YEAH, I, I THINK THE, THE SORT OF BOTTOM LINE ON THAT IS THAT UNFORTUNATELY, THIS CITY COUNCIL HAS TO PAY THE PRICE THAT OTHER CITY COUNCILS, UH, DECIDED TO FIND A DISCOUNT ON.
UH, REALLY, I, I CALL IT A DISCOUNT, BUT I DON'T THINK THEY INVESTED MUCH OF ANY INTO THE WASTEWATER THE WAY THAT YOU'VE DESCRIBED THE HISTORY DOUG, YEAR AFTER YEAR, OR ROBERT, UH, ABOUT SOME COUNCILS THAT WE'RE SO FOCUSED ON BRING, BRING NEW WATER, BRING NEW WATER TO SAN ANTONIO, THAT THEY FORGOT TO TALK ABOUT THE AGING INFRASTRUCTURE OF THE WASTEWATER PIPES AND THE INFRASTRUCTURE THAT THAT NEEDED TO BE INVESTED IN.
SO I THINK WE WOULD BE DOING EXACTLY THAT IF WE DECIDED TO START HAVING A CONVERSATION THAT CARRIED MOMENTUM THAT SAID, LET'S JUST NOT DO ANY RATE INCREASE.
THERE HAS TO BE SOME PERCENTAGE AND HOPEFULLY NOT HIGH.
WHICH IS WHY I HOPE THAT YOUR TEAM, DOUG, HAS SCRUBBED THIS TO THE POINT THAT WE CAN FIND SOME REASONABLE, SOME REASONABILITY TO THE NUMBER.
AND, AND I THINK THAT'S WHAT WE'RE TRYING TO CONTEND WITH HERE, IS HOW REASONABLE IS 5.8 TO THE EXTENT THAT THERE IS SOME EDGES AT WHICH YOU CAN START TO, TO CUT AWAY AT THAT.
BUT, UH, THE WAY THAT WE LOOK AT IT BASED ON MOSTLY INVESTING IN CAPITAL, UH, I, I ONLY SEE IN ONE ALTERNATIVE, WHICH IS TO DO NOTHING AND MAYBE KICK IT DOWN THE ROAD OR SAY, WE DON'T CARE TOO MUCH ABOUT YOUR CREDIT RATING.
UM, BUT I CAN'T SAY THAT GENUINELY WITHOUT BELIEVING THAT THAT IS GONNA HAVE SOME LONG-TERM EFFECT ON YOUR ABILITY TO DO BUSINESS.
SO IS THERE SOMETHING YOU WANNA RESPOND TO? UH, AND YOU'RE EXACTLY RIGHT, COUNCILMAN.
[01:45:01]
AND IF YOU LOOK BACK AT THE EARLY 1990S WHEN, AGAIN, A FEDERAL GOVERNMENT TOLD US YOU HAVE TO START WEANING YOURSELF UP FOR THE EDWARDS AQUIFER, AND YOU HAVE 15 YEARS TO DO IT.SO BY 2008, WE HAD, WE WERE GOING TO LOSE, UM, A BIG PORTION OF OUR ABILITY TO GET WATER FROM THE EDWARDS.
SO WE HAD A 15 YEAR START ON GETTING ADDITIONAL WATER RESOURCES INTO THIS COMMUNITY.
SO THAT'S WHEN, UH, PRIOR CITY COUNCIL STARTED GIVING RATE INCREASES TO DO THAT.
AND, AND, UH, SO YOU SAW WHEN SAWS NEEDED A RATE INCREASE, IT WAS BASICALLY FOR WATER SUPPLY.
AND YOU, AND IF YOU LOOK AT THE, THE SEWER RATES DURING THAT TIME PERIOD, IT WAS ESSENTIALLY ALMOST A FLAT LINE.
AND THEN WHEN I GOT THERE IN 2008, WHICH WAS RIGHT AROUND THAT TIME, UH, TALKING TO OUR STAFF AS ONE OF THE FIRST BRIEFINGS I GOT IS, WE'RE GONNA GET HIT WITH A CONSENT DECREE IN A FEW YEARS.
AND IMMEDIATELY, EVEN THOUGH THE CONSENT DECREE WAS IN 2013, THE COUNSEL OF 20, UH, 10, UH, IN 2011 GAVE US, STARTED GIVING US RATE INCREASES ON THE SEWER SYSTEM SO THAT WE COULD SHOW E P A, THAT WE ARE SERIOUS, WE UNDERSTAND WHAT'S GOING ON, WE'RE GONNA START SPENDING MONEY NOW, UM, MAKE SACRIFICES THEN NOW IN 2011, UH, SO THAT WHEN WE FINALLY DO, UH, REACH AN AGREEMENT WITH E P A, WE CAN SHOW THEM WE ARE DOING THE RIGHT THING.
AND, AND GUESS WHAT? IT WORKED, IT WORKED BEAUTIFULLY BECAUSE OF THE FEDERAL GOVERNMENT ON THE OTHER SIDE OF THE NEGOTIATING TABLE, SAW THAT WE WERE SERIOUS, SAW THAT WE WERE COMMITTED TO, UH, TO, UH, RAISING RATES TO MEET THOSE MANDATES.
AND THEY WERE MUCH EASIER TO NEGOTIATE WITH.
FOR EXAMPLE, OUR WASTEWATER TREATMENT PLANTS ARE OUTSIDE OF THE CONSENT DECREE.
THEY'RE NOT PART OF THAT CONSENT DECREE.
MITCHELL LAKE IS NOT PART OF THAT CONSENT DECREE.
AND SO WE WERE GIVEN THE FLEXIBILITY OF, UH, OF, UH, OF YEARS AND OF, AND OF MONEY ON HOW TO FIX THOSE PROBLEMS BECAUSE PRIOR COUNCILS AT THAT TIME WERE WILLING TO BITE THE BULLET.
AND, UH, ONE THING THAT, UH, OUR, OUR MAYOR DID, AND ON THE SEPTEMBER BOARD, HE SAYS, I DON'T WANT THAT SAME THING TO HAPPEN ON THE WATER SIDE.
AND SO PART OF THIS RATE INCREASE, UH, FROM 5.3 TO 5.8 WAS, UH, THAT HALF A PERCENTAGE IS TO MAKE SURE WE DON'T FALL BEHIND ON THE WATER SIDE.
WELL, UM, YOU KNOW, ROBERT, EVERY, EVERY TIME YOU COME TO US WITH SOMETHING LIKE THIS, YOU HAVE A, YOU AS WELL AS THE REST OF THIS COUNCIL HAVE A DIFFICULT, UH, CHARGE TO CARRY ON OUR SHOULDERS WHEN WE'RE GOING BACK AND TALKING TO THE COMMUNITY.
BECAUSE AT THE, ESSENTIALLY WHAT YOU'RE SAYING IS WE HAVE TO HAVE A RATE INCREASE TO DO ALL OF THE THINGS THAT YOU'VE DESCRIBED.
UM, AND THE BEST SELLING POINT AT, AT THAT IS THAT, AND YOU'LL NEVER REALLY SEE ANY OF THAT, BECAUSE WE WILL FIX IT UNDER YOUR FEET.
THE WATER'S NOT GONNA TASTE ANY BETTER, UH, IF YOU'RE PAYING A FEW BUCKS MORE.
UM, SO IT, IT'S HARD, BUT IT'S PART OF THE WAY A CITY OPERATES.
AND, AND, AND I TAKE THESE VERY SERIOUSLY.
I DON'T JUST SEND GAU TO THESE AFFORDABILITY FAIRS.
I GO MYSELF, I WENT BLOCK WALKING WITH YOU.
HERE'S A FORM, FILL IT OUT, MAIL IT IN.
IT IS WALKING WITH A COMPUTER, UH, SIGNING THEM UP IMMEDIATELY, AND THEN WE CAN SHOW THEM RIGHT THEN AND THERE.
THEY'RE SIGNED UP ON HOW MUCH MONEY THEY CAN SAVE.
AND SO WE TAKE THIS VERY SERIOUSLY.
UH, COUNCILMAN BROCK HOUSE, YOU TALKED ABOUT THAT $1, THE $6 THAT IT MIGHT BE GAS JUST TO GO FROM HERE TO THERE.
YOU OUGHT SEE THE LOOK ON THEIR FACES WHEN WE DO SIGN THEM UP AND THEY SEE WHAT THEIR SAVINGS ARE GOING TO BE, UH, OVER MONTH IN AND MONTH OUT.
SO I JUST WANT YOU TO RECOGNIZE, I HEAR YOU, AND I DO APPRECIATE THE CONCERN YOU HAVE FOR YOUR CONSTITUENTS, NOT JUST IN DISTRICT SIX, BUT THE WHOLE ENTIRE CITY ON WHAT, WHEN WE TALK ABOUT RATE INCREASES, WHEN WE'RE TALKING ABOUT TAKING THEIR HARD-EARNED MONEY OUT OF THEIR POCKET AND INTO SAWS, BUT WE'VE SINCERELY BELIEVE IT'S FOR A LEGITIMATE SERVICE THAT WE'RE PROVIDING FOR THEM.
WELL, LET'S TALK A LITTLE BIT ABOUT, UH, AFFORDABILITY, UM, ROBERT, 'CAUSE I'M GONNA QUOTE YOU IN SAYING THAT THAT'S THE ONE AREA OF THE BUDGET THAT YOU DON'T MIND, UH, BUSTING.
UM, SO I'M GONNA OFFER YOU SOME HELP IN DOING THAT IF I CAN.
SO, UH, I TALK TO MY STAFF A LOT.
WE'VE, WE'VE DONE A LOT OF EXERCISES IN SIGNING PEOPLE UP FOR, UH, PROJECT AWA OR A LOT OF UTILITY ASSISTANCE PROGRAMS THROUGH SAS.
CECILIA AND HER TEAM, GINO AND THEIR TEAM HAVE BEEN DOING A WONDERFUL JOB OF SIGNING UP FOLKS.
BUT ON PARTICULAR, WE, WE SPECIFICITY PROJECT AWA, ONCE YOU'VE QUALIFIED TWICE A YEAR, YOU CAN'T SIGN UP FOR THAT PROGRAM ANYMORE.
AND I'VE HAD A FEW FOLKS, FAMILY MEMBERS WHO HAVE CALLED US AFTER HAVING QUALIFIED TWICE, AND THEN THEY TYPICALLY GIVE US THE CIRCUMSTANCES IN WHICH, WHETHER IT'S A LOSS OF A JOB OR A, AN UNUSUAL CIRCUMSTANCE IN THEIR LIFE THAT THEY CAN'T PAY TO KEEP THE WATER ON, THAT THEY'LL COME TO US THREE MONTHS OUTTA THE YEAR.
SO CAN YOU, YOU RIFF WITH ME ABOUT WHAT WE CAN DO ON THERE? YOU KNOW, WHAT, WHAT I LIKE TO TELL MY CHILDREN, UM, AND OTHERS, IT'S, IT'S, IT'S EXPENSIVE TO BE POOR.
AND THESE KINDS OF EVENTS, A LOT OF US, UH, WE CAN SURVIVE THEM.
[01:50:01]
UNFORESEEN MEDICAL BILLS, A CHANGE OF JOBS, A LOSS OF A JOB, WE MIGHT HAVE A SPOUSE, WE MIGHT HAVE OTHER RESOURCES THAT WE SAVINGS THAT WE CAN AS EASILY ADJUST TO.BUT IF YOU'RE POOR, IF YOU'RE IN THAT CIRCUMSTANCE, ONE OF THESE THINGS CAN BE DEVASTATING.
AND JUST 'CAUSE YOU GOT A DIVORCE ONE YEAR DOESN'T MEAN YOU CAN'T, YOU LOSE YOUR JOB IN THE SAME YEAR.
DOESN'T MEAN YOU'RE NOT GONNA HAVE MEDICAL BILLS OUT OF THE ORDINARY UNINSURED, UH, THAT SAME YEAR.
SO YES, ORIGINALLY IT WAS, THIS IS A ONE TIME, UH, EVENT IN YOUR LIFE THAT WE'RE GONNA HELP YOU GET OVER THE HUMP ON, UH, THROUGH, UH, SHIRLEY GONZALEZ AND SOME OF HER NEEDS, SOME OF YOUR NEEDS THAT YOU NOTICED ABOUT.
WE CHANGED IT TO WHERE IT'S AT LEAST TWICE A YEAR.
UH, I'M NOT SURE IF IF THE CORPUS, UH, NANCY, WE CAN DO THAT WHETHER WE NEED TO HAVE, UH, ADDITIONAL, UH, MORE STRUCTURAL CHANGES.
BUT I UNDERSTAND WHAT YOU'RE TALKING ABOUT, THAT THIS PROGRAM NEEDS TO BE AVAILABLE MORE OFTEN THAN TWICE A YEAR.
LET'S GET TO A POINT WHERE I THINK YOU'RE GONNA PRESENT TO US AGAIN, UH, BEFORE WE VOTE, UH, SEE IF WE CAN GET, BECAUSE RIGHT NOW WE HAVE HELPED FAMILIES OUT THROUGH PRO PROJECT AWA AND CECILIA AND HER STAFF, WHETHER IT'S WRITTEN ON PAPER OR NOT, THEY HAVE PROVIDED US THE DISCRETION TO HELP A FAMILY OUT OUTSIDE OF JUST TWO MONTHS, UH, OUTTA THE YEAR.
BUT WE'D LIKE, I'D LIKE TO MAKE THAT A LITTLE MORE FORMAL BECAUSE IT, IT IS GOING THROUGH SOME RED TAPE TO TRY TO HELP A FAMILY OUT WHO, UH, HAD A CAR BREAKDOWN AND HAS SOME EXPENSES GO INTO THEIR VEHICLE TO GET THEM TO WORK.
SO, UH, ON THAT AFFORDABILITY PIECE, LET'S, LET'S TRY TO GET THAT RIGHT BECAUSE I HAVE SOME ANECDOTES THAT I THINK ARE AT PROJECT IOWA IS A, UH, ESSENTIALLY A 5 0 1 C THREE OUTSIDE OF SAWS THAT WE, THAT WE HAVE HELP ADMINISTERING.
AND ORIGINALLY IT WAS, UH, CERTAIN DONORS IN THIS COMMUNITY, UH, UH, INDIVIDUAL LIKE RED MCCOMBS THAT GAVE INITIAL CORPUS TO THE, UH, UH, TO THE PROGRAM.
AND WE USED, UH, THE, THE INTEREST INCOME OFF OF THAT.
SO, UM, UH, WHEN WE SAW US HAVE A UNITED, UH, WAY KIND OF PROGRAM RAISING MONEY, MOST OF OUR EMPLOYEES DONATE TO THAT, UH, PROJECT IOWA, UH, THE MAYOR HAS HER, HER FUND, HER, UH, FIVE K RUN OR 10 K RUN IN HER SITUATION.
IT'S A FULL MARATHON, I THINK.
UM, WE HAVE ONE SIMILAR LINE THAT ALL THE PROCEEDS GO TO PROJECT IOWA.
SO WE, WE TRY TO PUT AS MUCH MONEY AS WE CAN INTO IT.
AND THERE'S MORE THAN JUST PROJECT OUTLAW.
I THINK I'M FOCUSING ON THAT CATEGORY.
PLUMBERS TO PEOPLE, UH, ALL KINDS OF PROGRAMS THAT WE HAVE.
YEAH, WE HAVE A LIST, UH, THERE.
TO YOUR CREDIT, UH, ROBERT, THE LAST FOUR YEARS, YOU'VE DONE A REALLY GREAT JOB.
YOU AND YOUR TEAM AND WHOEVER WAS COMING UP WITH HOW TO ACTUALLY GO OUT INTO THE COMMUNITY AND ENGAGE WITH THEM.
IT USED TO BE THAT THERE WAS A, YOU KNOW, A LINK ON A WEBSITE OR SOMETHING AS, AS, UM, PATHETIC AS THAT IN TERMS OF GETTING TO VULNERABLE PEOPLE.
VULNERABLE PEOPLE ARE NOT SCOURING YOUR WEBSITE TO LOOK FOR LINKS TO HELP THEM SAVE, SAVE MONEY.
YOU ALL HAVE BUILT A TEAM THAT GOES OUT, IDENTIFIES, UH, THE AREAS.
AND EVEN IN SOME CASES WE TALKED ABOUT ENROLLS PEOPLE WITHOUT THEIR OWN KNOWLEDGE BECAUSE THEY'VE QUALIFIED, UH, AND THEY'VE BECOME A CERTAIN AGE.
AND I THINK IT'S THAT KIND OF CONCEPT THAT HELPS ME STOMACH THE IDEA THAT WE'RE TALKING ABOUT RATE INCREASES, BUT WE'RE NOT FORGETTING ABOUT THOSE FOLKS WHO WILL FEEL IT THE MOST, WHICH ARE THE MOST VULNERABLE.
BECAUSE I'VE SEEN, UH, THESE FARES THAT YOU'VE PUT TOGETHER AND, AND I'VE SEEN THE FACES OF PEOPLE WHO COULD SAVE $14 A MONTH, UH, ON THEIR WATER BILL BECAUSE YOU'VE QUALIFIED FOR SOME OF THESE PROGRAMS. SO, UH, LET'S MAKE SURE THAT THOSE PROGRAMS ARE NOT RUNNING OUT OF MONEY.
AND THEY, THEY, WE DO BUST A BUDGET.
AND SO WE MAKE A FORMAL ANNOUNCEMENT OR FORMAL, UH, REQUEST NOW THAT, THAT AT LEAST ON THINGS LIKE PROJECT AWA OR A FEW OTHERS, THAT WE'RE ABLE TO QUALIFY PEOPLE MORE THAN JUST TWO MONTHS OUTTA THE YEAR.
AND, UH, THAT'S, THAT'S ALL I'VE GOT, UH, MAYOR AND, AND DOUG, IF, IF YOU EVER DO FIND SOMETHING INTERESTING LIKE THAT, BRING IT TO MY OFFICE.
I CAN ANNOUNCE IT HERE AND MAYBE MY DREAM WILL BE REALIZED ONE DAY.
UM, UH, ROBERT AND STAFF AND EVERYONE, THANK YOU FOR THE PRESENTATION.
I DO WANT TO, UM, COMMEND YOU ALL FOR THE WORK THAT YOU AND THE BOARD HAVE BEEN DOING, UM, AND WITH THE COUNCIL'S HELP FROM THE PAST OF BEING ABLE TO WORK CREATIVELY ON WATER DELIVERY, UM, WHEN IT COMES TO OUR DESAL PLANT TO VISTA RIDGE, TO THE ED, UH, OUR BEAUTIFUL EDWARDS AQUIFER AND OTHERS, I THINK WE HAVE A GREAT OP, UM, DIVERSE WATER DELIVERY OPPORTUNITIES HERE IN THE CITY OF SAN ANTONIO.
I DO HAVE TO SAY, UM, BUT I AM VERY DISAPPOINTED.
I'M VERY DISAPPOINTED THAT, THAT I'D LIKE TO SEE THAT SAME KIND OF CREATIVITY IN THE WEIGHT WA WASTE WATER CAPITAL IMPROVEMENTS, UM, AND NOT JUST MAINTAIN THE INEQUITIES OF THE PAST AND JUST MAINTAIN THEM RIGHT NOW BECAUSE WE ARE ON THE SOUTH SIDE, AND YOU KNOW THIS VERY WELL, WE ON THE SOUTH SIDE HAVE BEEN, UM, LIVING WITH THE CITY'S EXCREMENT FOR OUR ENTIRE, UM, DEVELOPMENT OF THE CITY.
[01:55:01]
14, YOU LOOK AT THE MILES OF NEW AND RESTORED MAINS BY DECADES, AND YOU SEE IN THE WATER MAINS AND THE, THE WATER MAINS IN THE WA WASTEWATER MAINS, YOU SEE HOW THE, THE, THE INCREASES HAVE, AND THE BUILDING HAS STARTED IN THE TWENTIES AND THE FIFTIES, BUT WE KNOW VERY WELL THAT IN OUR PART OF THE AIR OF THE CITY, THAT PEOPLE WERE STILL, EVEN AS OF RECENTLY IN THE TWO THOUSANDS, WERE STILL LIVING ON SEWER AND SEPTIC TANKS AND ON WELLS IN INSIDE THE CITY LIMITS.AND THAT WE'RE JUST GETTING TO THAT.
SO BEFORE I PUT, UM, AN ADDITIONAL BURDEN ON MY RESIDENTS TO LIVE WITH MORE OF THE SMELL THAT THEY SMELL AT THEIR FIVE DIAMONDS LITTLE LEAGUE THAT'S PUMPING STATION RIGHT THERE.
AND BEFORE WE BUILD A RAW SEWAGE DETENTION SITE INSIDE LOOP FOUR 10 NEAR THE WORLD HERITAGE SITE NEXT TO STINSON AIRPORT.
SO EVERYONE FLYING IN WILL SEE IT.
I BELIEVE WE NE NEED SOME MORE OF THE CREATIVITY FOR OUR CAPITAL IMPROVEMENTS IN THE WASTEWATER.
UM, AND, YOU KNOW, WE ARE, WE ARE TRYING TO ENCOURAGE BALANCED GROWTH AND ECONOMIC DEVELOPMENT THROUGHOUT THE CITY.
AND TO PUT THIS HERE WHERE YOU ALL, UH, HAVE, UH, PROPOSED TO PUT IT BECAUSE THAT'S THE WAY IT'S BEEN DONE IN THE PAST AND GRAVITY, ET CETERA, UM, YOU KNOW, I THINK WE CAN THINK MORE CREATIVELY BECAUSE WE ARE TRYING TO DO OUR, I GET THAT PART, BUT WE ARE IN THE MIDST OF OUR ESSAY 2020 AND OUR BALANCED IN GROWTH THROUGHOUT THE CITY.
AND SO TO PUT SOMETHING LIKE THIS HERE INSIDE LOOP FOUR 10 WOULD BE SOMETHING THAT WOULD THEN HAMSTRING THE REST OF THE ECONOMIC DEVELOPMENT OPPORTUNITIES FOR OUR, OUR AREA.
BUT YOU ALSO, BUT YOU ALSO ARE CREATIVE IN TAKING THE CLEAN WATER FROM THE H TWO OAKS AND CARRYING IT UP NORTH TO YOUR ANDERSON PUMP AREA.
SO I'D LIKE TO SEE THAT KIND OF CREATIVITY, UM, WITH OUR WASTEWATER CAPITAL IMPROVEMENT AND TO MY NEW COUNCIL COLLEAGUES.
UM, WE'VE BEEN DEALING, AS WAS MENTIONED, CLEARLY WITH THE DECREE FOR FOUR YEARS NOW.
AND I ONLY BECAME AWARE OF THIS NEW RAW SEWAGE DETENTION SITE TWO MONTHS AGO, AND I DID NOT LEARN ABOUT IT FROM SAS.
AND SO THOSE OF US WHO'VE DEALT HISTORICALLY WITH INEQUITIES IN OUR AREAS NEED TO BE VIGILANT AND WATCH AND HAVE THESE CONVERSATIONS WITH, UM, SAS AND THE MORE THE MERRIER OF THE CONVERSATIONS BECAUSE I THINK IT'LL KEEP ALL OF US ACCOUNTABLE TO OUR, UH, TO OUR RESIDENTS AND MAYOR.
UM, AND I KNOW WE'RE, WE ARE ALL COUNTING ON YOU AND WE THANK YOU FOR CARRYING OUR MESSAGE, OUR EQUITY CONVERSATION TO THE SAS BOARDROOM BECAUSE WE ARE LITERALLY, WHAT WE ARE LITERALLY DEALING WITH HERE IN THE SOUTHERN SECTOR OF SAN ANTONIO IS BECAUSE OF THE PAST.
AND SO, AGAIN, BEFORE I CAN BE IN FAVOR OF A RATE ADJUSTMENT, I'D LIKE TO SEE MORE CREATIVITY BEFORE YOU COME TO US WITH THE FINAL, UM, OPTIONS AND ALSO KIND OF ENVIRONMENTALLY DESIGNED AND DIFFERENT ENVIRONMENTAL DESIGNS TO, TO THINK CREATIVELY, TO LOOK AT THE ENVIRONMENT, TO LOOK TO RESTORATION AND, UM, NOT JUST SO UTILITARIAN AS WE'VE SEEN IN THE PAST.
AND OF COURSE, I MEAN, I'M GLAD TO SEE WHAT WE'RE LOOKING AT WITH MITCHELL LAKE, THE PILOT STUDY.
I THINK WE SHOULD HAVE DONE THAT A LONG TIME AGO.
AND OF COURSE, WE NEED TO MAKE SURE THAT WE HAVE THIS, UM, EVEN FOR WHATEVER ADJUSTMENTS WE'VE HAD IN, UH, THE PAST, WE STILL NEED TO MAKE SURE THAT IT IS AFFORDABLE FOR OUR CONSUMERS, FOR THE RATE PAYERS.
UM, AND SO ANYTHING THAT WE CAN DO TO SOLIDIFY THAT AFFORDABILITY PROGRAM, I'M ALL FOR IT, OF COURSE.
BUT I WOULD LIKE TO SEE MORE OF THAT CREATIVITY IN THAT.
AND, UH, IS, UH, AGAIN, IT WAS NOT A, UM, A PROJECT THAT WE'RE DOING IMMINENTLY, NOT EVEN IN THE NEAR FUTURE.
IT'S MORE OF THE 20 BE, EVEN EVEN BEYOND THE CONSENT DECREE TIMELINE.
UH, SO THERE'S A LOT OF TIME TO GET CREATIVE AND TO BE INNOVATIVE IN THAT REGARD.
AND WE DO HAVE SOME IDEAS AND I THINK, UH, I'LL BE ABLE TO PUT A SMILE ON YOUR FACE.
OKAY, WELL, I, DID YOU SAY PERRY? YES, SIR.
UH, A COUPLE MORE QUESTIONS, UH, COMMENTS HERE.
UM, I WOULD SAY, WOW, I HOPE I'M NOT HERE THAT LONG, THAT I'M HAVING THOSE KIND OF DREAMS, NUMBER ONE, UH, WOW.
UH, BUT ANYWAY, UH, IN OUR BUDGET
[02:00:01]
FOR THIS NEXT YEAR, DID WE TAKE INTO ACCOUNT THIS, THIS RATE INCREASE? NO, SIR.WE DID NOT BUILD THAT INTO THE BUDGET.
SO ANYTIME THERE'S A PROJECTED RATE INCREASE, WE DON'T BUILD THAT INTO THE BUDGET UNTIL YOU GUYS ACTUALLY, UM, TAKE SOME TYPE OF ACTION ON IT.
WELL, I WOULD, UM, UH, YOU KNOW, RIGHT NOW I DON'T WANNA SEE ANY RATE INCREASE, BUT IF A RATE INCREASE IS PASSED ON, UH, BY THIS COUNCIL, I WOULD, I WOULD LIKE TO RECOMMEND, I WOULD LIKE TO SAY RIGHT NOW THAT, UH, YOU KNOW, THE CITY DOES TAKE A PORTION OF THE SAWS, SAWS BILL, UM, ON ANY RATE INCREASE THAT WE TAKE, I THINK THE CITY SHOULD FOREGO THAT, UH, THAT ADDITIONAL MONEY THAT WE WOULD BE TAKING FROM SAWS ON TOP OF THAT.
WHAT WOULD THAT, WHAT WOULD THAT AMOUNT BE? YOU HAD A SLIDE ON THAT, BEN.
THE PROJECTED NET NUMBER FOR US FOR FFY 2018 IS $543,000.
AND AGAIN, THAT'S A NET NUMBER BECAUSE, UM, THAT'S, WE GET THE 2.7% RETURN ON GROSS REVENUES, BUT WE ALSO PAY A WATER WASTEWATER BILL.
SO OUR, UH, EXPENSES WOULD BE GOING OFF.
SO THAT'S THE NET, THE NET INCREASE ABOUT THOUSAND DOLLARS, I WOULD SAY, YOU KNOW, THAT WOULD BE SUBTRACTED OFF OF THAT, UH, WHATEVER THAT PERCENTAGE, UH, INCREASE WOULD BE THAT WOULD, UH, COME OFF THE TOP AND THE CITY NOT TAKE THAT, TAKE THAT SINCE WE DIDN'T HAVE THAT FIGURED IN OUR BUDGET ANYWAY.
SO, UH, THAT WOULD BE MY RECOMMENDATION ON THAT.
AND THEN, UH, UM,
BEN, ON THE, UH, YOU MADE A COMMENT ABOUT SMOOTHING OUT WHAT, WHAT EXACTLY DID YOU MEAN BY THAT? AGAIN, WHAT WAS YOUR STATE, CAN YOU PULL UP THE, UM, SECOND PRESENTATION? SO THIS WAS ON THE FIVE YEAR RATE FORECAST.
SO ONE OF THE STRATEGIES THAT SAWS IS LOOKING AT IS, YOU CAN SEE IN 2020, THERE'S A VERY LARGE INCREASE THERE ASSOCIATED WITH VISTA RIDGE.
9.3 OF THAT IS IN THE WATER SUPPLY.
THAT IS PREDOMINANTLY THE VISTA RIDGE WATER STOMACH STARTING TO COME INTO SAWS, RIGHT? IT COMES IN, I BELIEVE THE SPRING OF 2020.
SO YOU'RE GETTING PARTIAL YEAR THERE, AND THEN A LITTLE BIT IN 2021.
SO PART OF THE, THE, THE WORK THAT THEY'VE BEEN DOING IS TO LOOK AT, UM, IF THEY CAN PERFORM BETTER IN 18 AND 19, ARE WE ABLE TO THEN MAYBE REDUCE THAT RATE IN 2020? FURTHER, THIS NUMBER WAS ABOUT 16.7%, I BELIEVE, WHEN WE PRESENTED THIS TWO YEARS AGO, IN TERMS OF A FIVE YEAR LOOK, AGAIN, THE WATER HADN'T BEEN LOCKED IN FOR VISTA RIDGE.
WE HADN'T RE REACHED FINANCIAL CLOSE.
THERE WERE A LOT OF ASSUMPTIONS BUILT IN THAT WE KNEW THAT WAS VERY CONSERVATIVE.
IT HAS, THE GOAL IS TO TRY TO GET IT TO COME DOWN MORE.
SO THEY'VE GOT TWO ADDITIONAL YEARS TO CONTINUE TO WORK ON THAT.
BUT YOU MADE A COMMENT THAT, UH, IT WAS BUILT INTO THE 18 AND 19 PROGRAM TO BUILD A, BUILD A FUND TO HELP REDUCE THAT IN 2020.
IT'S NOT BUILDING A FUND, BUT IF YOU LOOK AT DOUG'S SLIDE, WE TALKED ABOUT HOW TO FUND THE C I P, THERE'S SOME ADDITIONAL CASH THAT THEY WILL GENERATE THROUGH THAT INCREASED DEBT SERVICE COVERAGE METRIC THAT WILL HELP BECAUSE THEY'LL DEPLOY MORE CASH TOWARDS THE C I P IN 2020.
SO YOU END UP WITH LESS OF A, OF A NECESSARY RATE INCREASE.
WELL, I, I WOULD, AGAIN, UH, I WOULD LIKE TO IDENTIFY THAT MONEY AND, AND NOT BUILD UP THAT MONEY IN 2018 AND 2019, WHATEVER THAT RATE IS IN 2020.
UH, WHAT I MEAN BY THAT, BEFORE CLAYTON, THAT DECISION WAS MADE.
UM, AND IF THAT, UH, IF THAT PERCENTAGE IS 16%, THAT'S WHAT IT SHOULD BE IN 2020.
BUT I, I DON'T THINK WE SHOULD BE, UM, YOU KNOW, TAKING THAT CASH OUT OF THE 18 AND 19 PROGRAM JUST TO REDUCE THAT 2020 PROGRAM.
SOME OF THAT IS GONNA BE DRIVEN BY THE INDENTURE AS WELL, BECAUSE WHEN YOU HAVE VISTA RIDGE COMING ONLINE, IT'S AN OPERATIONS AND MAINTENANCE EXPENSE.
SO THAT WILL DRIVE THAT TWO MONTH RESERVE THAT I MENTIONED.
SO SOME OF THAT IS BUILT IN ALREADY AUTOMATICALLY BECAUSE OF THE INDENTURE.
UM, AND THEN SOME OF THAT, AGAIN, IS LOOKING AT WAYS TO FUND THE C I P WITH A LITTLE BIT MORE CASH OVERALL.
AND I'LL GO BACK AND LOOK AT THIS, BUT I THINK OVERALL, WHEN WE LOOKED AT IT BEFORE, WHEN YOU LOOKED AT THE, THE RATE INCREASES THAT WERE THERE BEFORE, WHEN YOU LOOK AT THIS ONE WHERE WE'RE GETTING IT DOWN TO 12.4%, THE AVERAGE BILL IS ACTUALLY LOWER UNDER THIS SCENARIO IN 2020 THAN IT WAS UNDER THE PREVIOUS VERSION.
WELL, AGAIN, BECAUSE THAT HELPS 'CAUSE YOU ISSUE LESS DEBT, YOU DON'T HAVE THAT INTEREST CARRY.
BUT AGAIN, I THINK WE NEED TO LET 2020 STAND ON ITS OWN AND NOT BE, UM, YOU KNOW, SETTING SOME SOMETHING
[02:05:01]
ASIDE TO PREPARE FOR THAT.I MEAN, I, I DON'T THINK IT'S GONNA BE THAT MUCH BECAUSE THERE'S A LOT OF UNKNOWNS YET OUT THERE, FOR EXAMPLE, SELLING WATER.
UH, THAT COULD REDUCE THAT EVEN FURTHER WHEN THE WATER LINE COMES ON BOARD.
UH, THERE'S A LOT OF, A LOT OF UNKNOWNS STILL OUT THERE AND, AND, UH, UH, I DON'T WANNA BE, YOU KNOW, RAISING RATES OVER THE NEXT COUPLE YEARS OR, OR SAVING MONEY OR SETTING THAT ASIDE FOR THE, UH, VISTA RIDGE PROJECT.
THAT'S, AGAIN, THAT'S WHAT I'D LIKE TO SEE.
UM, WHAT PUBLIC HEARINGS HAVE YOU HELD ON YOUR PROJECTED RATE INCREASES PUBLIC HEARINGS,
UH, PUBLIC, AS IN PART OF THE ORDINANCE? NO, JUST PUBLIC HEARINGS.
OH, WE, WE, WE, UM, ALL THE, ALL THE, UH, MEETINGS THAT WE'VE HAD.
OH, WE'VE HAD OVER 10, 15 IN TERMS OF COMMUN COUNCILMAN.
WE'VE BEEN WORKING WITH THE DIFFERENT LARGER NEIGHBORHOOD ASSOCIATIONS, AGAIN, OUT IN FRONT OF THEM.
AND AS ROBERT MENTIONED, WE'LL BE HOSTING A CENTRAL ONE AT OUR OFFICE SO THAT WE CAN STREAM IT LIVE AND THEN WE'LL BE HOSTING A FACEBOOK LIVE LATER THEREAFTER.
WITH THOSE OTHER MEETINGS THAT YOU'VE TALKED ABOUT, YOU SAID YOU WERE GONNA COME TO COUNCIL AND PROPOSE A 5.8% RATE INCREASE THIS YEAR AND FOUR POINT WHATEVER NEXT YEAR.
IS THAT WHAT YOU TOLD THEM AT THOSE MEETINGS? I BELIEVE THAT'S PART OF THE PRESENTATIONS, YES, SIR.
ANOTHER QUESTION I HAVE IS, UM, WHAT, WHAT ARE THE BUSINESS TIERS FOR WATER RATES COMPARED TO THE RESIDENTIAL TIERS FOR WATER RATES? UH, WE, WE HAVE COMMERCIAL RATES AND RESIDENTIAL RATES, RIGHT? YEAH, LET'S, LET'S REVIEW THOSE AGAIN.
'CAUSE WE'RE TALKING ABOUT RAISING RATES AND LIKE DO A COMPARISON THERE.
SO, SO THEY'RE ALL GOING UP THE SAME, BUT COMMERCIAL CLASS, RESIDENTIAL CLASS IS A BIT MORE HOMOGENOUS THAN THE COMMERCIAL CLASS.
WE HAVE COMMERCIAL CUSTOMERS, VERY SMALL COMMERCIAL CUSTOMERS UP TO TOYOTA, FOR EXAMPLE.
UM, SO THEY GO ON SOMETHING CALLED A BASE EXCESS MODEL WHEREBY WE LOOK AT THEIR USAGE IN THE PRIOR YEAR AND THEN WE TIER THEIR TIERS BASICALLY GO UP, IF THEY USE A HUNDRED TO A HUNDRED AND WHAT IS IT, 125% OF THEIR USAGE FROM THE PRIOR YEAR.
IF THEY ARE AT OR BELOW THEIR USAGE IN THE PRIOR YEAR, THAT'S CALLED THEIR BASE.
UM, AND THEN THEY, WE HAVE SUBSEQUENT HIGHER TIERS IF THEY USE MORE WATER THAN THEY USED IN THE PRIOR YEAR.
BUT WHAT ARE THE RATES IN THOSE TIERS? UM, DO YOU, I I CAN GET THAT FOR YOU.
I DON'T HAVE IT RIGHT AT MY FINGERTIPS, BUT, WELL, WE KNOW WHAT THESE RATES MEAN TO THE AVERAGE CUSTOMER, YOU KNOW, 80% INCREASE OVER 10 YEARS COMPOUNDED AND THEY'VE SEEN THE SAME INCREASES.
BUT, YOU KNOW, WHAT ARE THE, HOW MANY, HOW MUCH IS IT PER GALLON FOR THE RESIDENTIAL USER COMPARED TO PER GALLON FOR? WELL, IT DEPENDS ON WHERE THE RESIDENTIAL, AND WE CAN GET THAT DATA FOR YOU, BUT IT'S ACTUALLY, UM, PEOPLE THAT USE LOW AMOUNTS OF WATER ARE LESS THAN OUR, SAY OUR AVERAGE RESIDENTIAL CUSTOMER.
THE RESIDENTIAL CUSTOMERS ARE ACTUALLY GETTING A SLIGHT DISCOUNT COMPARED TO WHAT WE CHARGE THE COMMERCIAL CUSTOMERS.
BUT THOSE PEOPLE THAT ARE USING HIGH AMOUNTS OF WATER ON THE RESIDENTIAL BASIS ARE PAYING MORE THAN THE COMMERCIAL CLASS CUSTOMERS.
YEAH, THAT'S, THAT'S KIND OF WHAT I'D LIKE TO SEE.
'CAUSE I HAVE A LOT OF HIGHER PAYING CUSTOMERS IN MY DISTRICT AND I'M SURE THEY'D LIKE TO SEE THAT.
UH, WHAT PERCENT OF THE ANNUAL WATER USE, UH, IS ACTUALLY PROJECTED FOR THIS YEAR TO BE ATTRIBUTED TO BUSINESS USERS? WHAT PERCENTAGE OF THE WATER WE USE IS BUSINESS WATER? I'M TRYING TO THINK BACK.
UH, I'VE GOT IT PROBABLY, CAN YOU HEAR ME? MY CAVER THERE, BUT, UM, IT'S ROUGHLY 40% IS WHAT I WANT TO GUESS.
40% OF THE USAGE IS BY BUSINESS.
DOES THAT INCLUDE THE RECYCLED GRAY WATER? THAT WOULD BE POTABLE WATER.
I COULD GET THAT AND ADD THAT TO IT, BUT, ALRIGHT.
UM, AND SO WHAT PERCENTAGE OF THE WATER REVENUE COMES FROM THOSE BUSINESSES? IS IT 40%? UM, LEMME TRY TO DO THE MATH IN MY HEAD HERE.
SO, WATER SALES AND GALLONS, FOR EXAMPLE, IN 2016 WE SOLD GO TO GALLONS HERE.
SO WE SOLD 64 BILLION GALLONS WORTH OF WATER.
AND OF THAT ROUGHLY 28 BILLION GALLONS WAS SOLD TO THE COMMERCIAL CLASS CUSTOMERS, GENERAL CLASS AND IRRIGATION CLASS CUSTOMERS IN TERMS OF DOLLAR SALES,
[02:10:01]
ONE'S GONNA BE A LITTLE MORE CHALLENGING, BUT, UM, WATER SALES, I GOTTA ADD A COUPLE FIGURES TOGETHER, BUT, UH, SO WE HAD WATER DELIVERY AND WATER SUPPLY FEE REVENUE OF ROUGHLY 300.AND TRYING TO ADD NUMBERS IN MY HEAD, WHICH IS A LITTLE DIFFICULT, 315 MILLION, AND OUT OF THAT A HUNDRED AND OR 315 MILLION, WE HAD $83 MILLION THAT WENT TO THE GENERAL CLASS IN WATER.
SO 83 AND 57 WOULD BE 140 MILLION OUT OF 315 MILLION.
SO I CAN GIVE YOU A DETAILED SPREADSHEET OF, SO IT'S, IT'S PRETTY MUCH 40%, UH, COMMERCIAL USAGE AND 40% COMMERCIAL PRETTY MUCH WHEN WE'VE LOOKED AT, YES, IT'S THE COMMERCIAL CUSTOMERS ARE, ARE BEARING THEIR FAIR SHARE OF THE BURDEN OF COMPARED TO THEIR USAGE LEVEL.
UM, WHAT ARE, NOW I SAW A SLIDE EARLIER THAT TALKED ABOUT OUR RESERVES.
I BELIEVE IT WAS, UH, THE SLIDE NEAR THE END OF YOUR EARLIER PRESENTATION.
IT SHOWED THE COMPARISON OF THE DIFFERENT RATES, UH, THE DIFFERENT RATING AGENCIES AND EVERYTHING.
AND IN PART OF THAT IT TALKED ABOUT, UH, DAYS CASH ON HAND.
AND IT'S, IT SEEMS LIKE WE HAVE A LOT OF CASH ON HAND COMPARED TO EVERY OTHER CITY, UH, WHICH KIND OF LEADS ME TO BELIEVE THAT WE'VE GOT A LOT OF, UM, RESERVES.
SO, AND THIS IS ONE OF THE KEY METRICS THAT THE RATING AGENCIES LOOK AT, AND I DID, AGAIN, OBVIOUSLY THERE'S A FEW THAT ARE MUCH HIGHER.
ATLANTA AND CHARLOTTE BEING MUCH HIGHER.
IF YOU HAD THE AVERAGE, IF YOU ADD 'EM ALL UP, THE OTHER SEVEN ENTITIES, INCLUDING ATLANTA AND CHARLOTTE, YOU GET TO A NUMBER OF ABOUT 460 DAYS CASH ON HAND FOR THE AVERAGE OF THE OTHER SEVEN.
WELL, YEAH, WHEN YOU'VE GOT 1200 AND 900 SURE.
IT'S SO EXCLUDE ATLANTA AND YOU'RE AT 335.
AND WE SEEM TO HAVE A PRETTY, UH, HEFTY AMOUNT OF CASH ON HAND.
AND TO COUNCILMAN PERRY'S QUESTION, AND I THINK THAT'S A LITTLE BIT WHAT, WHAT, UH, COUNCILMAN PERRY WAS TALKING ABOUT, WE HAVE PURPOSEFULLY TRIED TO BUILD UP, UM, SOME OF OUR CASH RESERVES TO, I'M GONNA GO TO ANOTHER SLIDE HERE REAL QUICK, BUT, SO AGAIN, WE WERE PLANNING TO TRY TO UTILIZE, AND YOU CAN SEE THAT THE CASH FUNDING PERCENTAGE IN 2020 IS MUCH GREATER.
ONE OF THE THINGS THAT I HEARD FROM COUNCILMAN PERRY IS, HEY, DON'T, DON'T TRY TO BUILD UP YOUR CASH RESERVES TO, TO GENERATE ADDITIONAL CASH FUNDING IN 2020.
MAYBE TRY TO COME BACK HERE AND TRY TO PUT IT IN 2018 AND 2019.
WE CAN LOOK AT POTENTIAL OPPORTUNITIES TO DO THAT, BUT, UM, THAT, THAT WILL CAUSE A POTENTIAL BIG SPIKE IN 2020.
BUT IF THAT'S THE DIRECTION OF THIS COUNCIL, THEN THAT'S SOMETHING WE CAN LOOK AT.
UH, I APPRECIATE THAT YOU'VE BEEN HAVING THOSE PUBLIC MEETINGS AND YOU'VE BEEN TALKING ABOUT YOUR RATE INCREASE, BUT, YOU KNOW, WE ARE GONNA BE TALKING TO A LOT MORE OF THE PUBLIC ABOUT THESE RATE INCREASES IN OUR DISTRICTS.
AND, UH, YOU KNOW, I I GET ONLINE YOUR MESSAGES ABOUT WATER, UH, THAT COME FROM SAWS AND SOME OF 'EM ARE VERY GOOD, BUT I HAVEN'T SEEN ANY OF 'EM THAT TALKED ABOUT, OH, BY THE WAY, WE'RE PROPOSING THIS BIG RATE INCREASE.
SO HELP US OUT, START PUBLICIZING THAT STUFF A LITTLE MORE BROADLY SO THAT WE CAN REMIND THEM, DIDN'T YOU SEE THAT ON THAT SAWS NOTE THEY GAVE YOU INSTEAD OF US HAVING TO GO OUT THERE AND SELL IT FOR YOU.
ALRIGHT, THANK YOU COUNCILMAN.
UM, ROBERT, THANK YOU FOR BEING HERE.
I'VE, I'VE, I'VE GOT A DIFFERENT PERSPECTIVE ON WHAT IT IS YOU'VE COVERED WITH US TODAY BECAUSE I THINK I'M THE ONLY PERSON AT THIS TABLE WHO SERVED ON THE RATE ADVISORY COMMITTEE WHEN WE WERE, UH, DOING ALL THIS ALGEBRA.
AND ONE OF THE THINGS THAT WE DID ON THAT RATE ADVISORY COMMITTEE WAS I, I SERVED ON IT WITH, UM, ALL THE CITY COUNCIL APPOINTEES AND, UM, REPRESENTATIVES FROM THE DIFFERENT SECTORS INCLUDING, UH, ENVIRONMENTAL GROUPS, BUSINESS SECTORS, MANUFACTURERS, THE REAL ESTATE COMMUNITY, COPS, METRO WAS THERE, UM, AND HOMEOWNER GROUPS.
AND I HAD THE OPPORTUNITY TO WORK WITH YOU AND YOUR TEAM ON, UH, REALLY GETTING A GRANULAR, VERY CLOSE LOOK AT THE ENTIRE SAWS OPERATION.
UM, AND I THINK THAT WAS, WHAT, 18 MONTHS THAT WE DID THAT.
RIGHT? UM, AND REALLY WORK LATE INTO THE NIGHT ON EVERY SINGLE ONE OF THOSE.
EVERY SINGLE ONE OF THOSE WAS AN OPEN MEETING.
AND WE DID HAVE CITIZENS ATTEND AND VOICE CONCERN AND ACTUALLY, UH, GIVE SOME, SOME MEANINGFUL, UH, COMMENTS THAT HELPED INFORM OUR DECISIONS.
UM, I GOT TO SPEND A LOT OF TIME WITH YOU
[02:15:01]
AND A LOT OF TIME WITH GAU, UM, AND, YOU KNOW, THE ECONOMICS, BUT WHAT, WHAT I'VE LEARNED WAS THAT THE ECONOMICS OF WATER ARE THE SAME IN SAN ANTONIO AS THEY ARE ALL OVER THE REST OF THE UNITED STATES, RIGHT? AND SO, UM, I I'M, I'M MAKING NOTES HERE ABOUT THE THINGS THAT I REMEMBER LEARNING THAT, YOU KNOW, WE'RE STRIKING, RIGHT? AND THAT IS, UM, TAKING US ALL THE WAY BACK TO WORLD WAR II, EVERY MAJOR CITY IN THE UNITED STATES, YOU KNOW, AFTER WORLD WAR II INVESTED IN CREATING LARGE NETWORKS OF WATER SUPPLY AND UM, UH, FOR, YOU KNOW, PIPELINES UNDERGROUND.AND THEN IN 19, THE SEVENTIES, WE DOUBLED DOWN AGAIN.
AND THAT'S WHEN, UH, YOU KNOW, THE CLEAN WATER ACT AND THE E P A, UH, WERE CREATED.
AND WE STARTED GETTING THESE GREAT GRANTS FROM THE FEDERAL GOVERNMENT TO BUILD OUT TREATMENT PLANTS AND DRAINAGE FACILITIES AND WASTEWATER, UM, UH, YOU KNOW, FACILITIES AND PUMPING STATIONS AND ALL THAT.
AND WE DID, AND LIKE EVERY OTHER CITY IN THE UNITED STATES.
UM, AND TODAY AS A RESULT OF THAT, WE'VE GOT TENS OF THOUSANDS OF MILES OF PIPE UNDERGROUND IN SAN ANTONIO.
AND SO DOES EVERY OTHER MAJOR CITY IN THE UNITED STATES.
AND ALL OF THOSE PIPES WEAR OUT AND THEY GET OLD BECAUSE SOME WERE MADE OF CLAY AND OTHERS WERE MADE OF, YOU KNOW, STEEL COMBINED WITH AS ASBESTOS.
AND, UM, YOU KNOW, AND THE NEWER ONES ARE MADE OF JUST RAW STEEL AND OUR FACILITIES ARE HUGE AND THEY GET OLD.
AND EVERY MAJOR CITY IN THE UNITED STATES IS FACING THE SAME PROBLEM THAT WE'RE FACING, WHICH IS WE'VE GOT ALL THIS MAINTENANCE THAT WE GOTTA DO ON OLD PIPES.
AND THEN ADD TO THAT, THE FACT THAT WE'RE GROWING AT A RATE OF 156 PEOPLE A DAY, NO, I'M SORRY, YOU GUYS ARE CREATING ALSO NEW PIPES OR LAYING PIPE OF 156 MILES A YEAR, RIGHT? UH, ON TOP OF WHAT YOU'VE ALREADY GOTTA MANAGE, UM, THE COST OF ENGINEERING AND CONSTRUCTION HAS INCREASED.
THE COST OF LABOR HAS INCREASED.
UM, THE, JUST IN 2015 AND 2016, THE COST, YOU KNOW, FROM 2015 TO TODAY, BACK THEN IN 15, THE COST OF, UH, POUND, I'M SORRY, THE COST OF, UH, METRIC TON OF STEEL WAS SOMEWHERE AT AROUND $400.
TODAY IT'S BETWEEN SIX AND $700.
UM, AND YOU KNOW, WHEN YOU HAVE A DROUGHT LIKE THE ONES WE'VE HAD OVER THE PAST 10, 15 YEARS, THAT HITS YOUR BOTTOM LINE IN, YOU KNOW, IN ONE WAY.
THEN YOU HAVE THESE BIBLICAL LEVEL STORMS THAT YOU KNOW AND FLOODS THAT HIT YOUR BOTTOM LINE IN A COMPLETELY DIFFERENT WAY.
UM, AND THEN ON TOP OF THAT, AT THE ALGEBRA, THAT THE FEDERAL GOVERNMENT IS NO LONGER HELPING US OUT, UH, BY, YOU KNOW, AWARDING GRANTS LIKE THEY USED TO.
AND SO WE ARE HAVING TO FOOT THAT BILL THAT WE USED TO FOOT THAT THEY USED TO HELP US FOOT.
UM, AND IF YOU LOOK AT EVERY MAJOR CITY IN THE UNITED STATES FOR THE PAST TWO YEARS, THE COST OF WATER HAS BEEN THE STAPLE THAT HAS RISEN FASTER THAN ANY OTHER HOUSEHOLD STAPLE THAT'S NOT SAN ANTONIO.
AND NO MATTER HOW WELL YOU'VE MANAGED SAWS, WHETHER YOU GOT AN A CREDIT RATING OR A DOUBLE A OR A B CREDIT RATING, THAT'S JUST THE MATH OF THE UNITED STATES AND THE WATER SYSTEMS. AND SO I'M, UH, OTHER CITIES AND THEIR PERFORMANCE AND ALL THAT ARE, THEY HELP INFORM ME AS TO HOW IT IS THAT WE'RE PERFORMING.
AND, YOU KNOW, OTHER MAJOR UTILITIES AROUND THE COUNTRY DON'T BELONG TO THE CITY EITHER.
THEY DON'T CONTRIBUTE TO THE BUDGET AND SOMEHOW DESPITE ALL THESE DIFFICULTIES YOU DO, RIGHT? AND SO I I THINK THAT, YOU KNOW, YOU AND, AND SHARON AND MARY AND THE TEAM AND GAVIN NOW DESERVE A, A, YOU KNOW, A A AN APPLAUSE REALLY FOR, FOR MANAGING TO DO THE VERY HARD WORK AND STILL CONTRIBUTE TO THE CITY'S COFFERS.
WITH THAT SAID, UM, I DO WORRY THOUGH, 'CAUSE I DON'T UNDERSTAND VERY WELL WHY IT IS THAT, UM, THOSE ONE POINT OUT OF, OF YOUR 1.8 MILLION CUSTOMERS, THOSE THAT DON'T LIVE IN CITY LIMITS.
SO, YOU KNOW, CASTLE HILLS, LEON VALLEY, AND THOSE OUT IN THE, UM, YOU KNOW, BEXAR COUNTY, BUT NOT SAN ANTONIO, WHY IT IS THAT THEY PAID DIFFERENT RATES THAN WE DO.
AND SO IF YOU CAN WALK ME THROUGH THAT, I'D APPRECIATE IT.
WELL, UH, ORIGINALLY IT WAS BECAUSE IT WAS MORE, UH, COSTLY TO SERVE THEM WHEN, YOU KNOW, WE HAD A MUCH SMALLER CITY AND THE OUTLYING SUBURBS, SUBURBS WERE OUTLYING SUBURBS.
UH, NOW WE FULLY ENCLOSE SOME OF THOSE, UH, SUBURBAN CITIES, CASTLE HILLS, UH, LEON VALLEY, CHAU PARK, THEY ARE, UH, COMPLETELY SURROUNDED AND WE HAVE CUSTOMERS BEYOND THAT.
AND SO ORIGINALLY IT WAS BECAUSE IT WAS MORE COSTLY TO SERVE THEM.
AND NOW A LOT OF IT IS BY AGREEMENT.
UH, SOME OF THESE CITIES, WE HAVE, UM, INTERLOCAL AGREEMENTS WITH THEM THAT THEY ACTUALLY GET CHARGED IN CITY RATES BECAUSE OF A PRIOR NEGOTIATION THAT WE HAD WITH THEM, UH, INDIVIDUALS THAT LIVE ON OUT IN THE COUNTY, NOT IN ANY CITY THAT OUR CUSTOMERS, THEY PAY A DIFFERENT RATE.
SO OVERALL, THESE OUT OF CITY RATES
[02:20:01]
ARE 18% HIGHER THAN THE RATES, UH, BY WHAT SAN ANTONIONS PAY.SO, SO JUST SO THAT I, WHEN I EXPLAIN TO MY CONSTITUENTS, WE ARE NOT SUBSIDIZING THE WATER THAT CASTLE HILLS IS DRINKING AND USING TO WASH THEIR CARS, RIGHT? CORRECT.
UH, WITH THAT, I'LL, I'LL TELL YOU THAT, YOU KNOW, ALL OF US, WE HAVE TO DO A LOT OF BLOCK WALKING AND WE HAVE TO TALK TO A LOT OF CONSTITUENTS AT TOWN HALL MEETINGS AND ALL THAT.
AND WHAT I'VE DISCOVERED IS THAT SAN ANTONIANS ARE SMART, UM, AND THEY UNDERSTAND WHEN YOU EXPLAIN TO THEM, YOU KNOW, WHY IT IS, THINGS COST WHAT THEY DO, RIGHT.
AND, UM, I, IT'S NOT AN EASY CONVERSATION.
I WISH I DIDN'T HAVE TO EXPLAIN TO THEM WHY THINGS COST WHAT THEY DO.
AND YOU GUYS HAVE MADE IT VERY EASY TO DO THAT.
WHAT I'D LIKE TO DO THOUGH IS, UM, WHEN YOU HAVE THESE, YOU KNOW, PUBLIC MEETINGS, UH, WHICH YOU'RE GONNA, I IMAGINE YOU'RE GONNA HAVE, YOU KNOW, I IMAGINE YOU'RE GONNA HAVE MORE, CAN YOU PLEASE INCLUDE OUR OFFICES SO THAT WE CAN BLAST THAT OUT TOO AND WE CAN BRING PEOPLE SO THAT THEY CAN, THEY CAN HEAR FROM YOU AND ASK YOU THE DIFFICULT QUESTIONS AS WELL? UH, WE WILL.
AND, UH, ALL OF Y'ALL HAVE BEEN VERY RECEPTIVE TO, UH, GET PUTTING OUT INFORMATION ON YOUR NEWSLETTERS, YOUR BLAST EMAILS ABOUT, UH, INFORMATION THAT WE WANT TO COME OUT TO GO OUT TO THE COMMUNITY.
SO WE WOULD BE GLAD TO DO THAT.
COUNCILWOMAN SANDOVAL, THANK YOU VERY MUCH MR. PUENTE, FOR YOUR PRESENTATION AND FOR COMING TO MY OFFICE A FEW DAYS AGO.
UM, I IMAGINE IT'S NOT EASY TO BE HERE EVERY YEAR, UM, GETTING TO BE THE PUNCHING BAG FOR, FOR THE COUNCIL MEMBERS, BUT THE FIRST TIME I GOT, UH, COUNCILMAN PERRY IN BROCK HOUSE, UH, PUNCHING AT ME, LET'S SEE IF WE CAN SOFTEN THE BLOW A LITTLE BIT, BUT THAT'S WHY THEY PAY YOU THE BIG BUCKS THERE.
UM, SO MY, MY DISTRICT, AND I'M SURE MANY OTHERS, IS ONE OF THE ONES THAT EXPERIENCES THE SEWAGE OVERFLOWS.
SO I ABSOLUTELY SEE THE, THE NEED FOR THIS WORK.
I DON'T, I DON'T WANT SEWER FLOATING, FLOATING IN THE STREETS OF, OF DISTRICT SEVEN.
UM, AND SADLY, I, I JUST DON'T THINK THE CONSENT DECREE IS ANYTHING TO, TO BE PROUD OF.
BUT, BUT IN THE END, THE MONEY WE SPEND ON THAT IS, IS AN INVESTMENT IN OUR INFRASTRUCTURE, WHICH IS GONNA HELP OUR COMMUNITY IN, IN THE LONG RUN.
SO I, I SUPPORT YOUR, YOUR CONTINUED IN INVESTMENT IN, IN MEETING THE CONSENT DECREE.
UM, I AM A LITTLE BIT CONCERNED ABOUT, UH, US NOT KEEPING UP WITH THE RECOMMENDED REPLACEMENT RATE THAT YOU DEMONSTRATED.
UM, ARE THERE CITIES WHO ARE ACTUALLY ABLE TO KEEP UP WITH THAT? IT SEEMS, UH, REALLY AGGRESSIVE COMPARED TO WHAT WE'RE DOING.
UM, I DON'T KNOW IF YOU KNOW STEVE, BUT, UM, WE'RE PRETTY PROGRESSIVE IN WHAT, UH, REPLACEMENTS THAT WE, DID YOU HEAR THE QUESTION? UH, O OTHER CITIES THAT HAVE MORE OF AN AGGRESSIVE REPLACEMENT RATE THAN WE DO, I GET TO SPEND A LOT OF TIME WITH A, A LOT OF DIFFERENT UTILITY MEMBERS, AND I KNOW OF VERY FEW CITIES THAT ACTUALLY MEET THOSE REPLACEMENT RATES.
I THINK THEY ALL ASPIRE TO GET THERE, BUT THE REALITY IS VERY FEW OF THEM, AT LEAST IN MY EXPERIENCE, WANNA PUBLICLY TALK ABOUT WHERE THEY'RE AT RELATIVE TO THOSE RATES.
UM, SO WE'RE, WE'RE ALL JUST AS BAD OR, OR SOMETHING LIKE THAT.
UM, SO I DO HAVE SOME, SOME QUESTIONS, UH, ABOUT THE PRESENTATION.
SO IF I'M READING YOUR GRAPHS OR YOUR CHARTS CORRECTLY, IN 2018, THE RATE INCREASE WOULD YIELD 36.3 MILLION, IS THAT CORRECT? YES.
AND IN 2019, THAT'S 27.4 MILLION.
AND THEN YOU HAD A SLIDE ABOUT A MISCELLANEOUS $580,000.
WHAT WAS THAT? THOSE ARE, UH, MISCELLANEOUS FEES FOR, UM,
THOSE FEES ARE ASSOCIATED WITH GENERAL OR BUSINESS CLASS FIRE HYDRANT METERS.
FOR EXAMPLE, ONCE WHEN, UH, DEVELOPERS WANT TO UTILIZE A FIRE HYDRANT METER, WE HAVE A DIFFICULT TIME GETTING THEM TO RETURN THOSE FIRE HYDRANT METERS SO WE CAN ENSURE THAT THEY'VE READ IT, THAT WE ARE GETTING AN APPROPRIATE READ FROM IT.
SO, UH, SPEAKING OF, OF READING, HOW MUCH ARE YOU SPENDING RIGHT NOW ON THE A M I? UM, IT JUST SOUNDED LIKE IT HAD SO MANY CHALLENGES.
LIKE IT ALMOST WASN'T EVEN READY FOR PRIME TIME BASED ON THE CONVERSATION WE HAD.
THAT'S EXACTLY WHAT WE'RE DOING.
WE'RE, UH, ASKING THE BOARD FOR APPROPRIATION OF MONEY TO MAKE A BUSINESS CASE OF IT, TO, TO REALLY STUDY IT AND WHAT IS THE PROPER WAY TO GO, UH, WHO ARE THE PLAYERS OUT THERE AND WHAT COULD, WHAT IS THE RETURN ON INVESTMENT AND WHAT KIND OF YEARS ARE WE, ARE WE TALKING ABOUT THERE? YEAH, I, SO WE'RE SPENDING THE MONEY FIRST IN THAT MANNER, AND THEN IF IT'S SUCCESSFUL, THEN WE'LL SPEND MONEY ON A PILOT.
AND THEN, AND, AND THAT MAGNITUDE IS ONLY IN THE
[02:25:01]
ONLY, AGAIN, SAY THAT LIGHTLY, BUT WE'RE SPENDING LESS THAN, I THINK 200,000, I'M SORRY, LESS THAN $200,000 ON THE CONSULTANT STUDY.AND TO HELP DEVELOP THE BUSINESS CASE.
AND THEN WE WOULD GO OUT AND ACTUALLY, OKAY, NOT ONLY JUST DON'T TAKE THE RECOMMENDATIONS OF THAT BUSINESS CASE WITHOUT TESTING THEM, WE WOULD ROLL OUT A PILOT PROGRAM OF WHICH WE'D SPEND ABOUT $1.6 MILLION, IS KIND OF WHAT WE BUDGETED TO POTENTIALLY SPEND ON A PILOT PROGRAM TO SEE WHETHER THE RESULTS WE'RE ATTAINING ARE ACTUALLY CONSISTENT WITH THOSE WE ANTICIPATED TO RECEIVE BASED UPON THE BUSINESS CASE.
IF THE BUSINESS CASE IS STRONG ENOUGH FOR IT, YES.
UM, UH, AND THEN I HAVE ANOTHER QUESTION.
UH, YOUR GRAPHS SHOW A DECREASE IN IMPACT FEES BETWEEN 2018 AND 2019.
CAN YOU TELL ME WHY YOU ANTICIPATE A DECREASE? UM, THAT'S A VERY DIFFICULT ONE, AS YOU CAN SAY.
UM, OBVIOUSLY AS DEVELOPMENT SLOWS DOWN, THEN, UH, WE DO SEE A REDUCTION.
WE HAVE BUILT IN A LITTLE BIT OF CONSERVATISM THERE BECAUSE WE ARE GOING THROUGH A RATE GONNA START ANOTHER RATE, UH, AN IMPACT FEE STUDY.
AND BASED UPON, AGAIN, ONCE WE BRING THE VISTA RIDGE WATER SUPPLY PROJECT ONLINE, WE ARE, WE DON'T SEE A LOT OF ADDITIONAL WATER SUPPLY NEEDS GOING FORWARD.
SO WE DON'T HAVE TO BUILD A LOT OF INFRASTRUCTURE FOR ADDITIONAL WATER SUPPLY.
SO WE THINK THAT THE WATER SUPPLY IMPACT FEE MAY DROP FAIRLY SIGNIFICANTLY AS WE MOVE FORWARD.
SO THAT'S WHY WE GOT, WE GOT A LITTLE BIT MORE CONSERVATIVE IN OUR PROJECTION FOR 2019 AS TO WHAT WILL BE RECEIVED FROM IMPACT FEES IN 2019.
I THINK IT'S ABOUT SIX OR $7 MILLION LESS THAN WHAT WE'RE PROJECTING IN 2018.
MAYOR, I THINK THAT ONE WOULD BE A GREAT ONE TO HEAR AT ONE OF THESE ALTERNATE, UH, THURSDAYS IS HOW THOSE, UH, IMPACT FEES ARE THE PROCESS THAT YOU GO THROUGH.
I'M, I'M SURE, I KNOW IT'S VERY LONG AND INVOLVED IN THERE, AND I, I WILL LET, UH, YOU COUNCIL MEMBERS KNOW MOST OF, UH, THE APPOINTMENTS THAT YOU HAVE ON THE, ON THIS COMMITTEE, UH, THE INDIVIDUALS HAVE EXP NOT THE INDIVIDUALS, BUT THEIR TERM HAS EXPIRED, RIGHT? SO YOU DO HAVE AN OPPORTUNITY TO APPOINT SOMEONE NEW.
UM, I JUST A, A FEW MORE QUESTIONS.
UH, EVEN THOUGH I, I REALLY DO SEE THE NEED FOR, FOR THE INCREASE IN FEES, I, I WOULDN'T BE A GOOD COUNCIL PERSON IF I DIDN'T, UM, YOU KNOW, OFFER SOME SCRUTINY
UM, AND I GUESS, UH, YOU HAVE AN INCENTIVE BASED RATE STRUCTURE IS, IS WHAT I'VE HEARD THAT YOU CHARGE MORE TO, TO HIRE USERS.
UM, HOW EFFECTIVE HAS THAT REALLY BEEN AND HOW, HOW DO YOU MEASURE THAT? UM, WE, WE THINK IT'S BEEN VERY EFFECTIVE.
UM, WHAT WE DID, WE WENT FROM A FOUR TIER SYSTEM TO AN EIGHT TIER SYSTEM.
AND WHERE IT REALLY STARTS TAKING EFFECT IS, UH, IN THE PRIOR FOUR, UH, FOUR TIERS.
UH, YOU DIDN'T START REALLY FEELING A, A HUGE RATE INCREASE UNTIL MAYBE THE 50,000 GALLON A MONTH, UM, RATE, UH, USAGE.
BUT IN THIS ONE, WHEN YOU GET TO 12,000 GALLONS PER MONTH, YOU START, UH, REALLY GETTING A SHOCK, A STICKER SHOCK THAT YOU'RE USING A LOT OF WATER.
AND IF YOU WANT TO CONTINUE TO DO THAT, THEN PAY THE CONSEQUENCES.
BUT IF YOU ARE, IF YOU'RE NOT, THEN YOU'RE SHOCKED INTO EITHER STAYING WITHIN THAT TIER OR GOING DOWN BELOW.
SO WE THINK IT'S REALLY BEEN EFFECTIVE.
UH, WE'VE SEEN THAT, UH, THERE'S SOME BEEN ADJUSTMENT BY OUR CUS BY OUR USAGE BECAUSE OF IT.
AND WHAT REALLY IS, IS VERY MEANINGFUL OF THAT ALSO IS THAT THAT LOWEST TIER, UH, UH, 3000 GALLONS, UH, PLUS YOU ACTUALLY HAD A BILL, UH, DECREASE.
UH, YOU ACTUALLY PAID LESS BECAUSE OF THE DIFFERENT RATE.
IT WAS THE LIFELINE RATE THAT WE CREATED.
AND SO ALTHOUGH THE RATES WENT UP, YOUR ACTUAL BILL WENT DOWN.
AND THAT'S AN EXCELLENT QUESTION, COUNCILWOMAN.
UM, WE HAVE DEVELOPED SOME DATA.
THE NEW RATE STRUCTURE ONLY WENT INTO EFFECT IN 2016.
AND IF YOU'LL RECALL IN 2016, WE HAD ABOUT ABOUT 44 INCHES OF RAIN HERE IN SAN ANTONIO.
SO, UM, THE NEW RATE STRUCTURE IS REALLY DESIGNED TO SEND THOSE PRICE SIGNALS, AS ROBERT WAS JUST TALKING ABOUT WHEN PEOPLE TURN ON THEIR IRRIGATION SYSTEMS OR WANNA WATER THEIR GRASS.
UM, SO WE HAVEN'T GOT A LOT OF DATA YET ON THAT, BUT I WILL TELL YOU WHAT THE DATA WE HAVE LOOKED AT, IT'S ACTUALLY BEATING OUR PROJECTIONS.
WE'RE SEEING MORE PEOPLE DOWN IN THE LOWER TIERS AND LESS PEOPLE IN THE HIGHER TIERS THAN WHAT WE WERE PROJECTING WHEN WE, WHEN WE BASICALLY FORECAST WHAT PEOPLE WOULD, WOULD DO IN, YOU KNOW, THE BREAKDOWN BY THE EIGHT DIFFERENT TIERS.
SO WE CAN SHARE SOME OF THAT DATA WITH YOU.
THAT'S, THAT'S REALLY GOOD NEWS TO TO HEAR.
UM, I FEEL LIKE THE, THE CHEAPEST GALLON OF WATER YOU DELIVER IS THE ONE YOU DON'T HAVE TO DELIVER, RIGHT? BECAUSE YOU DON'T HAVE TO BUILD OR MAINTAIN THE INFRASTRUCTURE.
YOU DON'T HAVE TO PAY THE POWER THAT IT TAKES TO, TO TRANSPORT IT THERE.
SO I THINK, UH, PAYMENT SCHEDULES IS ONE INCENTIVE METRIC, BUT I'D LIKE TO SEE US EXPLORE, UH, SOME MORE.
AND THAT'S SOMETHING WE COULD DO, UM, OFFLINE.
[02:30:01]
A LITTLE BIT MORE CREATIVE LIKE THE COUNCILWOMAN, UM, SAID.SO, UM, I'LL WRAP UP WITH JUST, UH, KIND OF THREE QUESTIONS.
AND THIS IS FOR, IN ORDER FOR ME TO BE COMFORTABLE WITH THE, THE RATE INCREASE THAT THAT'S GOING FORWARD, I'D I'D LIKE TO ASK YOU FOR, FOR THREE THINGS.
ONE OF THEM IS, UM, YOUR GOVERNMENT PROGRAM, UH, WHERE YOU, YOU KNOW, YOU SAID ABOUT 13% OF YOUR CAPITAL BUDGET IS SPENT ON COORDINATING OR ACTUALLY NOT COORDINATING
UH, SO 13% OF $391 IS $50 MILLION.
THAT'S MORE THAN THE RATE INCREASE, RIGHT? SO THIS YEAR WHEN WE WERE PREPARING OUR I M P FOR DISTRICT SEVEN, I ASKED MY STAFF TO WORK WITH YOUR STAFF SO THAT WE WOULDN'T HAVE THAT WASTE IN, IN MONEY AND, AND COORDINATE OUR WORK ON THE SAME ROADS, UM, OR TO STAGGER THEM SO THAT YOU WOULDN'T COME AND UNDO THE WORK WE DID AND WE WOULDN'T REQUIRE YOU TO GO OUT OF YOUR WAY.
SO I GUESS WHAT I'D, I MEAN, 13% IS HUGE, 50 MILLION IS HUGE.
SO IS THERE SOME WAY YOU CAN COORDINATE WITH THE CITY, WITH TDOT AND THE COUNTY AND, AND TRY TO WORK DOWN? YES.
IT'S, IT'S NOT RATCHET THAT DOWN.
THE COORDINATION WORKS VERY WELL.
WE WORK VERY CLOSELY WITH MIKE FRISBEE, UM, AND WITH THE RENEE GREEN FROM THE COUNTY AND WITH THE INDIVIDUALS FROM TXDOT.
SO THE COORDINATION REALLY DOESN'T HAPPEN THAT OFTEN WHERE ONE, UH, ENTITY COMES IN AFTER THE OTHER ONE AND TEARS UP A, A NEWLY PAID STREET.
THAT DOES NOT HAPPEN THAT OFTEN.
ACTUALLY, WHAT WE'RE TALKING ABOUT IS, UM, JUST THE FACT THAT THE CITY WANTS TO DO CERTAIN DRAINAGE PROJECTS OR DIRT, CERTAIN, UH, UH, STREET REPAIRS.
UH, THE COUNTY WANTS TO DO IT, THE
EITHER WE WERE, UH, PLANNING TO DO IT OR WE WERE NOT PLANNING TO DO IT.
AND SOMETIMES IT'S PERFECTLY GOOD INFRASTRUCTURE, BUT WE HAVE TO TEAR IT UP AND MOVE IT OUT AND, AND EITHER, UH, REPLACE IT, UH, DEEPER OR TO THE SIDE OR WHATEVER.
THAT'S WHAT WE'RE TALKING ABOUT WHEN WE MAKE MAKING THESE $50 MILLION IN EXPENDITURES.
STILL SOMETHING THAT SOUNDS FISHY.
UM, I'M JUST WONDERING IF THERE'S ANY WAY TO, TO REDUCE THAT NUMBER.
WELL, THERE, THERE ARE AND WELL GO AHEAD.
UM, YOU KNOW, OUR POSITION WOULD BE, WE CAN ALWAYS DO BETTER, BUT I JUST WANTED YOU TO KNOW THAT THERE ARE MONTHLY, WHAT WE CALL UTILITY COORDINATION MEETINGS GOING ON WHERE SAWS, C P S, THE CITY, TXDOT, BEXAR COUNTY, WE ALL GET TOGETHER TO SAY WHAT'S ON YOUR CALENDARS.
WE HAVE A A LONG RANGE VIEW OF WHAT'S COMING UP SO THAT WE CAN ALL ALIGN WITH THE WORK THAT WE KNOW THOSE OTHER UTILITIES ARE PLANNING ON DOING.
UM, THERE'S A LOT OF INFORMATION THAT GETS EXCHANGED, BUT I THINK LIKE EVERYTHING ELSE WE DO, WHEN YOU'RE TALKING ABOUT THE NUMBERS AND THE, THE AMOUNT OF WORK GOING ON, THERE'S PROBABLY MORE WE COULD DO TO IMPROVE THAT.
SO WE'LL WORK WITH YOUR OFFICE AND DO WHAT WE CAN TO SEE WHAT ELSE COULD BE DONE.
I THOUGHT WE MADE SOME IMPROVEMENTS IN MY OFFICE WHEN WE PREPARED OUR IMD.
UM, THE OTHER THING IS, UH, WHEN YOU CAME TO TO MY OFFICE, WE TALKED ABOUT HOW MUCH YOU SPENT IN ENERGY, I THINK, UM, DID YOU TELL ME IT WAS ABOUT 20 SOMETHING MILLION DOLLARS? A 28, I BELIEVE A YEAR.
I'M GONNA TRY TO FIND THE EXACT NUMBER, BUT IT'S LIKE THAT'S RIGHT.
THIS IS WHERE WE WERE LAST TIME.
UM, SO, UH, THINGS, FACILITIES LIKE THE DESAL PLANT, UM, AMAZING CONCEPT, BUT EXTREMELY ENERGY INTENSIVE.
IT'S OUT IN A, IN A FIELD WHERE THERE'S OPPORTUNITY FOR SOLAR.
UM, I GUESS WHAT'S THE POSSIBILITY OF YOU WORKING WITH C P S TO EXPLORE USING SOLAR AND MAYBE REDUCING THE AMOUNT WE SPEND ON ENERGY USE, EITHER AT THIS FACILITY OR, OR OTHERS? WELL, WE'RE VERY PROUD THAT AT OUR DO RIOS PLANT, WE HAVE, UH, ACREAGE THERE, UH, ALSO 600 ACRES.
WHEN IT WAS BUILT, IT WAS THE LARGEST SOLAR FARM IN THE STATE OF TEXAS.
AND LUCKILY THERE'S MORE SOLAR FARMS BEING BUILT THROUGHOUT THE STATE, SO NOW IT DOESN'T HAVE THAT DESIGNATION ANYMORE.
AND ENOUGH ENERGY, UH, WAS PRODUCED THERE, UH, UH, BY THE SOLAR PANELS TO RUN THAT FACILITY.
THOSE RIOS ARE A S R AND EVEN OTHER FACILITIES.
SO IT'S, IT'S A GREAT, UM, UM, OPPORTUNITY AT, UH, THE A S R PLANT.
WE'RE WORKING WITH C P S, TALKING TO C P SS, UH, TO, AND THE FIRST ONE WAS, UH, UH, AN AGREEMENT WITH SON EDISON, A PRIVATE ENTITY THAT CAME IN.
SO WE'RE DOING THE SAME THING AT THE A S R.
AND THEN I'M, I'M, I KNOW I'M REACHING, I'M DOING IT WITH COUNCILMAN SALANA WAS, WAS DREAMING OF, EXCEPT I
UM, WHAT IS YOUR COMMITMENT TO REDUCING THE NON-REVENUE USAGE? WHEN IS THAT? WHAT'S YOUR
[02:35:01]
TARGET? WHEN ARE WE GONNA GET THERE? YOU KNOW, I, I'M, I'M VERY PROUD THAT, UM, UH, THERE, PATRICK SHRIVER IS THE INDIVIDUAL IN CHARGE OF THAT.AND EVERY TIME I SEE PATRICK, I THINK HE APPRECIATES THE FACT THAT I GIVE HIM THE ATTENTION THAT, UH, THAT I GIVE THAT ISSUE BECAUSE IT'S SO EASY TO JUST, UM, SAY, UH, SOIL CONDITIONS A BREAK HAPPENED, AND THAT IS THAT, BUT WE'RE WORKING, WORKING VERY HARD ON IT.
IT'S, IT'S A BIG COMMITMENT ON OUR PART.
IT'S, IT'S A WATER CONSERVATION, UH, INITIATIVE FOR US ALSO.
AND TO GIVE YOU AN EXAMPLE OF THAT, UH, WE REACHED OUT TO THE EDWARDS AFER AUTHORITY KNOWING THAT, UH, THERE WAS AN AGREEMENT BETWEEN 32 DIFFERENT STAKEHOLDERS IN THIS STATE FROM, UH, DOW CHEMICAL TO THE SIERRA CLUB, UH, TO FARMERS, TO QUARRIES TO CITIES LARGE AND SMALL REGARDING THE EDWARDS AQUIFER.
UH, AND OUR, THAT AGREEMENT MANDATED THAT E A A UNDERGOES SOME CERTAIN WATER CONSERVATION MEASURES THEMSELVES.
E A A WITH A LIMITED STAFF, UH, DID NOT, UH, FEEL THAT THEY COULD, UH, REACH THE GOALS THAT THEY WANTED TO GO TO REACH.
SO THEY ACTUALLY CONTRACTED WITH US AND THEY ARE SPENDING, UM, WHAT IS IT, $18 MILLION OVER FIVE YEARS, $18 MILLION OVER FIVE YEARS.
THEY ARE PAYING US $18 MILLION OVER FIVE YEARS TO FIX, UH, BREAKS IN OUR SYSTEM.
SO THOSE KINDS OF INITIATIVES THAT WE HAVE IN PLACE TO DRIVE DOWN THAT REVENUE, UH, NON-REVENUE WATER, I'M PROUD TO SAY THAT WE ARE, UH, BETTER THAN AVERAGE, BUT WE WANNA BE MUCH BETTER THAN AVERAGE THAN THE NATIONAL STANDARD AND THE STATE STANDARD.
OUR NUMBERS ARE MUCH BETTER THAN THOSE.
BUT THIS IS A, UM, I DON'T EVEN WANNA CALL IT, UM, LOW HANGING FRUIT.
AND AS A MATTER OF FACT, PATRICK, ONE OF THE THINGS HE, HE TOLD ME WAS, GIMME SOME OF THAT CONSENT DECREE MONEY, THAT SAME KIND OF MONEY, AND YOU CAN SEE WHAT I CAN DO.
AND AS A MATTER OF FACT, ONE OF THE CONFERENCES WAS, UH, THAT I SIGNED OFF ON WAS, UH, PATRICK BEING ABLE TO GO TO SOME OF THESE CONFERENCES WHERE HE LEARNS DIFFERENT WAYS TO, UH, TO
SO, UH, THAT ONE I'M PASSIONATE ABOUT.
UH, SO I HAVE YOUR THREE THINGS TO WORK ON.
I I'M CONFIDENT THAT I CAN MEET ALL THREE FOR YOU.
ALRIGHT, WELL THANK YOU VERY MUCH.
THANK YOU VERY MUCH MR. ENTIN AND TO ALL YOUR STAFF FOR THANK YOU FOR BEING HERE AND PUTTING UP WITH OUR, OUR GRILLING.
I'M GLAD Y'ALL CAN WITHSTAND WHAT, TWO AND A HALF HOURS SO FAR.
COUNCILWOMAN S UM, SANDOVAL? YEAH, WE'RE NOT DONE, ROBERT.
I JUST WANTED TO ACTUALLY, COUNCILMAN SANDOVAL HIT MY POINT THAT I FORGOT TO MENTION ABOUT IMPACT FEES, UH, WHICH LOOK, WE'RE TRYING TO DO THINGS, IT WAS JUST MORE OF A CALL.
YOU AND I SPOKE ABOUT THIS WHEN WE VISITED THAT, UM, IN THIS DRIVE AND PUSH ON HOUSING AND, UH, INCENTIVIZING AND HOW WE'RE REVAMPING AND LOOKING AT THE WAY WE DO BUSINESS, THAT IMPACT FEE PORTION OF THE SAWS BUDGET IS GOING TO BE CRITICAL TO THE SUCCESS OF OUR, OUR MULTI-FAMILY HOUSING OPPORTUNITIES, OUR SMALL BUSINESS, UH, EXPANSION, OUR, OUR INCENTIVIZING, OUR OUR GRABBING NEW BUSINESSES TO COME TO SAN ANTONIO, HELPING ONE STAY HERE.
THOSE DOLLARS ARE GONNA BE CRITICAL.
AND, UH, AND, AND THAT'S A BUDGET ITEM THAT YOU, THAT YOU SAID YOU WERE VERY CONSERVATIVE AND WHICH ACTUALLY MAKES SENSE IN THE LONGER TERM OF WHAT WE'RE TRYING TO ACCOMPLISH.
BUT IT WAS JUST SOMETHING I WANTED TO MAKE SURE THAT I PUT ON THE TABLE, UH, TO THE COUNCIL WAS THAT, THAT THAT BUDGET ITEM IS IMPACTFUL AND IT'S GOT THAT, EVEN THOUGH IT'S 73, 70 5 MILLION, IT'S GONNA MAKE A HUGE, UH, DIFFERENCE FOR PEOPLE TRYING TO EXPAND AND GROW THEIR, THEIR BUSINESSES AND OPPORTUNITIES.
BUT JUST WANTED TO THROW THAT OUT THERE.
AND THEN OF COURSE, I WANTED TO SAY TO MY COLLEAGUE, COUNCILMAN SYA, YOU KNOW, I'M, I'M, UH, I, I FEEL BAD FOR HIM THAT HE HASN'T BEEN ABLE TO FULFILL HIS DREAM OVER THE LAST, UH, SEVERAL YEARS.
BUT I MEAN, THAT'S WHY WE HAVE ELECTIONS AND TERM LIMITS, RIGHT? SO WE HAVE FRESH FACES, UH, NEW OPPORTUNITIES TO LEARN AND CHALLENGE THINGS.
AND I FOR ANYBODY LISTENING, UH, FOR ANYBODY LISTENING OUT THERE, I WOULD TELL 'EM, I THINK IT'S RIGHT AND JUST TO QUESTION ANY ITEM YOU POSSIBLY CAN.
AND, UH, AND, AND I THINK IN THIS PARTICULAR CASE, IT'S NOT KICKING THE CAN DOWN THE ROAD, A FISCAL RESPONSIBILITY TO SAY, BE AS LOW AS POSSIBLE.
RIGHT? THE BEST AFFORDABILITY PROGRAM IS THE LOWEST RATE POSSIBLE PERIOD.
THAT'S THE BEST AFFORDABILITY PROGRAM IS TO KEEP RATES AS LOW AS HUMANLY POSSIBLE AND KEEP THE RATE INCREASES AS LOW AS HUMANLY POSSIBLE.
THERE'S NO BETTER RATE AFFORDABILITY PROGRAM.
SO WITH THAT, I WOULD TELL YOU THAT AGAIN, YOU KNOW, IT MATTERS TO BREAK OFF LOWERING THE RATE, RIGHT? OR THAT, THAT RATE INCREASE AND THE, THE, THE DIFFERENCE BETWEEN WHAT'S O AND M AND WHAT'S, UH, CONSENT DECREE.
SO THAT IS, THAT'S A CRITICAL PIECE.
'CAUSE I CAN FIND SUPPORT FOR CONSENT DECREE PORTIONS BECAUSE THAT, I MEAN, WE, WE HAVE TO MEET OUR, OUR MINIMUM REQUIREMENTS THAT TO KEEP US, UH, IN LINE WITH THE DECREE AND THE, AND THE DIRECTIVES AND ALSO TO BE GOOD STEWARDS OF THE MONEY AND, AND, AND THE INFRASTRUCTURE ITSELF FOR THE FUTURE.
SO IT'S VERY CRITICAL THAT WE SEE THE SEPARATION BETWEEN THE TWO OF THOSE.
AND, AND THAT'S, THAT'S ONLY A COUPLE OF POINTS I WANTED TO MAKE AND I APPRECIATE TIME AND THANK YOU AGAIN FOR THE PRESENTATION.
COUNCILWOMAN GRO, ONE LAST THING TO MAKE CLEAR, AND I'VE
[02:40:01]
BEEN HAVING TO STEP OUT A LITTLE WHILE, BUT, UM, THAT WE CAN GET THE LIST OF ALL OF THESE MEETINGS THAT YOU ALL HAVE HAD A LIST OF ALL OF THEM THAT YOU'VE BEEN TO.AND I'LL, I'LL JUST CLOSE BY SAYING THANK YOU, UH, TO MY COLLEAGUES FOR THE THOUGHTFUL QUESTIONS AND THANK YOU TO THE STAFF FOR, FOR, UM, ADDRESSING THEM.
UM, I WILL SAY THAT I AM, I'M OF THE MIND THAT, UH, THE COUNT, THE CONSENT DECREE IS NOT JUST A REASON TO INVEST, IT'S ALSO A LESSON OF WHAT HAPPENS WHEN WE DON'T INVEST.
AND SO THE REASON WHY IT ASKED, UH, SAWS TO REALLY FOCUS ON INFRASTRUCTURE IS THAT WE DON'T FIND OURSELVES IN A, IN A SITUATION WHERE WE'RE HAVING TO DEFER MAINTENANCE AND THEN THEREBY DEFER THE RESPONSIBILITY FOR THAT MAINTENANCE TO FUTURE, UH, GENERATIONS IN SAN ANTONIO.
SO I, I APPRECIATE THE WORK THAT YOU'VE DONE.
UH, OBVIOUSLY WE NEED TO DIG INTO THE NUMBERS A LITTLE BIT MORE FOR SOME OF THE COUNCIL OFFICES, BUT LOOK FORWARD TO SEEING THIS AT COUNCIL.
[Executive Session]
NOW IS 4 59, UH, AND PURSUANT TO THE AUTHORITY ON, ON THIS 18TH DAY OF OCTOBER, 2017, PURSUANT TO THE AUTHORITY GRANTED BY CHAPTER 5 5, 1 OF THE TEXAS GOVERNMENT CODE V T C S, THE TEXAS OPEN MEETINGS ACT, THE CITY COUNCIL WILL NOW RECESS INTO EXECUTIVE SE SESSION TO DISCUSS ECONOMIC DEVELOPMENT NEGOTIATIONS PURSUANT TO TEXAS GOVERNMENT CODE SECTION 5 5 1 0.087, ECONOMIC DEVELOPMENT, THE PURCHASE EXCHANGE LEASE OR VALUE OF REAL PROPERTY PURSUANT TO TEXAS GOVERNMENT CODE SECTION 5 5 1 0.072 REAL PROPERTY LITIGATION OPTIONS RELATED TO OPIOID MANUFACTURERS, DISTRIBUTORS AND PROMOTERS PURSUANT TO TEXAS GOVERNMENT CODE SECTION 5 5 1 0.071 CONSULTATION WITH ATTORNEY AND LEGAL ISSUES RELATED TO THE CITY'S LEASE AGREEMENT WITH GOOGLE FIBER, TEXAS L L C RELATED PURSUANT TO TEXAS GOVERNMENT CODE SECTION 5 5 1 0.071 CONSULTATION WITH ATTORNEY.