[00:00:10]
[CALL TO ORDER]
BUDGET COMMITTEE MEETING.UM, IT'S THE SECOND MEETING, UM, THAT WE'VE HAD FOR, FOR THIS BUDGET PERIOD.
UM, IN ATTENDANCE TODAY, WE HAVE MYSELF, COMMISSIONER T.
WE'VE GOT, UM, COMMISSIONER MAXWELL GAINES, AND COMMISSIONER MIKE REYES, ALL IN PERSON.
UM, AND IT'S 1:02 PM WE'LL CALL THE MEETING TO ORDER.
UM, THE FIRST ITEM THAT WE WILL REVIEW, I GUESS, IS THE, UM, APPROVAL OF THE MINUTES FROM THE
[APPROVAL OF MINUTES]
LAST MEETING.AND, UM, DOES ANYBODY HAVE EITHER COMMISSIONER, HAVE ANY QUESTIONS REGARDING THE MINUTES FROM THE LAST MEETING? OKAY.
HEARING NO QUESTIONS THEN, UM, IF SOMEONE WOULD MOVE TO APPROVE, I WOULD MOVE TO APPROVE.
WE HAVE A SECOND, SECOND, WONDERFUL MOTION TO APPROVE BY COMMISSIONER MAXWELL GAINES, THE SECOND BY COMMISSIONER REYES.
ALL THOSE IN FAVOR, RAISE YOUR HANDS.
[2. Austin Water Financial Forecast Operating Requirements Cost Drivers]
TO THE DISCUSSION ITEMS. UM, DISCUSSION ITEM NUMBER TWO IS THE AUSTIN WATER FINANCIAL FORECAST OPERATING REQUIREMENT, COST DRIVERS.UM, AND I'LL TURN THAT OVER TO STAFF.
JOSEPH GONZALEZ, ASSISTANT DIRECTOR OVER FINANCIAL SERVICES WITH AUSTIN WATER.
AND, UH, UH, YOU KNOW, WE'LL START WITH THE, UH, FINANCIAL FORECAST OPERATING REQUIREMENTS, COST DRIVER UPDATE.
AND JUST AS A REMINDER, UM, YOU KNOW, UH, OUR BUDGET IS STILL BEING DEVELOPED.
UH, UH, THE CITY'S BUDGET OFFICE, UH, AND, AND CMO, UH, CITY MANAGER'S OFFICE ARE PUTTING TOGETHER THE PROPOSED BUDGET.
UM, SO IT'S, IT'S NOT, YOU KNOW, AVAILABLE FOR, FOR PUBLIC RELEASE YET.
UM, BUT, UH, YOU KNOW, OUR FINANCIAL FORECAST HAS BEEN PRESENTED TO, TO COUNCIL, UH, BY CITY MANAGER'S OFFICE.
AND, AND THAT IS AVAILABLE FOR, FOR PUBLIC DISCUSSION, AND IT REALLY SERVES AS THE FRAMEWORK FOR, FOR OUR BUDGET PROCESS.
UM, YOU KNOW, WE, WE REALLY STRIVE TO, WHEN WE'RE DEVELOPING OUR FIVE YEAR FORECAST TO, UM, TO DEVELOP NUMBERS THAT, THAT, YOU KNOW, PROVIDE A FRAMEWORK FOR OUR, OUR, OUR BUDGET PROCESS.
AND SO, SO WE'LL HIGHLIGHT SOME OF THE SIGNIFICANT CHANGES THAT WE'RE, UH, INCLUDED IN OUR FIVE YEAR FORECAST AND, AND WE WOULD EXPECT FOR, FOR THOSE CHANGES REALLY TO, TO BE INCORPORATED IN, IN OUR PROPOSED BUDGET THAT WILL BE RELEASED, UH, PUBLICLY ON JULY 11TH, IN, IN ADVANCE OF A PRESENTATION TO COUNSEL ON JULY 15TH.
SO, UH, AGAIN, THE, UH, THE PROPOSED BUDGET IS ANTICIPATED TO BE RELEASED BY, UH, THE BUDGET OFFICE AND CITY MANAGER'S OFFICE, UH, JULY 11TH.
AND AS SOON AS IT IS RELEASED, WE'LL SEND IT OUT, UH, TO, UH, TO THE COMMISSION AS A WHOLE.
UM, WE, WE GENERALLY PULL THE AUSTIN WATER SPECIFIC PAGES, UH, SO THAT, UM, COMMISSIONERS CAN REVIEW OUR BUDGET, UM, IN ADVANCE OF OUR NEXT, WELL, OUR COMMISSION MEETING IMMEDIATELY FOLLOWING THE PRESENTATION TO COUNCIL.
SO, UH, AGAIN, THE BUDGET WILL BE PRESENTED TO COUNCIL ON JULY 15TH, AND WE WILL PRESENT IT TO COMMISSION ON JULY 16TH.
AND SO AS SOON AS IT'S, IT'S RELEASED PUBLICLY, WE'LL SEND IT OUT TO THE COMMISSIONERS.
SO WITH THAT, WE'LL START WITH, UM, YOU KNOW, THE SIGNIFICANT, UH, YOU KNOW, COST DRIVERS AND, AND, UH, THAT IMPACT OUR OPERATING REQUIREMENTS.
AND FOR THAT, I'LL TURN IT OVER TO SONG LEE FLOYD.
GOOD AFTERNOON SONG, LEE FLOYD AUSTIN WATER FINANCE.
AND I WILL WALK YOU THROUGH THIS LIST OF THE, UH, COST DRIVERS FOR AUSTIN WATER'S FORECAST OPERATING REQUIREMENTS.
AND SO TOTAL FORECASTED FY 2 0 2 6 OPERATING REQUIREMENTS IS AT 831.7 MILLION, AND WE NORMALLY COMPARE TO OUR CURRENT BUDGET, WHICH IS FY 25 AMENDED BUDGET, UH, WHICH AT 7 73 $0.6 MILLION RIGHT NOW.
AND THIS RESULT IN A DIFFERENCE, UH, UH, INCREASE OF $58.1 MILLION.
WE HAVE SEVERAL DIFFERENT KIND OF COST DRIVERS.
THE FIRST CATEGORY IS WHAT WE CALL CDY COST DRIVERS.
THESE ARE NORMALLY THE COST DRIVERS THAT, THAT, UM, SET FOR US FROM THE BUDGET OFFICE.
[00:05:01]
DRIVERS THAT, UH, OCD DEPARTMENT HAS TO IMPLEMENT.AND WE, YOU KNOW, HAVE VERY LIMITED, UH, CONTROL.
SO EVERY YEAR CD BUDGET OFFICE WILL DECIDE ON A FORECAST PERCENTAGE FOR THE WAGE ADJUSTMENT, AND THIS YEAR THE PERCENTAGE IS 3% FOR THE FORECAST, AND WHICH RESULT IN ABOUT $4.4 MILLION INCREASE FOR AUSTIN WATER.
AND THEN THEY ALSO, UH, DETERMINES A HEALTH INSURANCE, UH, AMOUNT FOR US, WHICH IS ABOUT $1.1 MILLION.
AND THEN, UH, THE EMPLOYEE, UH, RETIREMENT CONTRIBUTION ALSO INCREASED, WHICH FOR US IS, FOR US ONE IS ABOUT $0.6 MILLION INCREASE.
AND THEN WE USE CD FLEET FOR OUR FIELD FOR OUR, UH, FLEET MANAGEMENT.
SO THE FLEET, UH, PROPOSED A FUEL AND MAINTENANCE INCREASE, UH, FOR AUSTIN WATER PORTION IS ABOUT $0.4 MILLION.
SO THESE ARE THE CDY COST DRIVERS.
AND THEN THE NEXT CATEGORY IS, UH, DEPARTMENT WIDE COST DRIVERS.
IF YOU HAVE ANY QUESTION ON THE CITYWIDE COST DRIVERS.
SO THE CITY WIDE WAGE ADJUSTMENT, YOU GUYS HAD MENTIONED AT THE LAST MEETING THAT THERE HAD BEEN AN INCREASE.
UM, AND INSTEAD OF, I THINK, WAS IT LIKE A, KIND OF LIKE A BUMP JUST TO KEEP RETENTION AND THEN, OR TO INCREASE RETENTION AND THEN, UM, THAT BECAME PERMANENT? IS THAT INCLUDED IN THAT NUMBER? NO, THAT'S IN THE SECOND CATEGORY.
OKAY, SO THE DEPARTMENT WIDE COST DRIVERS, UH, THESE ARE NUMBERS.
WE, WE ARE, WE ARE PRESENTING THE LIST IN DESCENDING ORDER.
SO THE LARGEST INCREASE FOR DEPARTMENT FOR AUSTIN WATER, UH, IS A $21 MILLION INCREASE IN TRANSFER OUT, UH, CATEGORY.
AND THAT'S PRIMARY, UH, DUE TO THE INCREASED CIP CASH FINANCING TRANSFERS.
AND THEN, UH, THE NEXT ITEM IS THE $15 MILLION INCREASE IN DEBT SERVICE REQUIREMENT, WHICH, UH, MOSTLY IS BECAUSE OF THE CAPITAL SPENDING PLAN GROWTH AND ALSO INCREASE IN SCHEDULE THEIR SERVICE PAYMENT.
AND THE NEXT ITEM IS THE RETENTION, UH, CONVER STIPEND CONVERSION.
SO ESSENTIALLY A COUPLE YEARS AGO, WE, UH, AUSTIN, WHY IMPLEMENTED A 10% RETENTION BONUS AND THEN, UH, LA CURRENT YET IN 25, THIS AMOUNT WAS CONVERTED INTO A EITHER 7% OR 4%, UH, PERMANENT INCREASE BASED ON THE, THE, THE TENURE TENURE WITH THE AUSTIN WATER.
AND THIS RESULTED IN ABOUT A ANNUAL AMOUNT, ABOUT $8.4 MILLION.
BUT SINCE WE DID NOT BUDGET THAT AMOUNT IN FY 25, SO WE HAD TO ADD THE AMOUNT BACK IN FOR 26 FORECAST.
DOES THAT HELP ANSWER YOUR QUESTION? YES, THANK YOU.
AND THEN NEXT IS WE, UH, FORECASTED SOME CHEMICAL AND ELECTRIC SERVICES COST INCREASE, AND THAT'S ABOUT $1.59 MILLION THAT WE INCLUDED IN THE FORECAST.
AND THEN WE ALSO INCLUDED $1.6 MILLION IN CONTRACTUAL AND COMMODITY INFLATION COST.
AND THEN, UM, WE HAD AN INCREASE IN COMMERCIAL PAPER ADMINISTRATIVE EXPENSES AND BUYING ISSUE COST.
UM, CD OF AUSTIN IS GOING THROUGH A BRANDING REBRANDING TRANSITION.
AND SO, UH, EACH DEPARTMENT WAS REQUIRED TO COME UP WITH ESTIMATE OF HOW MUCH THEY THINK WILL COST TO, UH, IMPLEMENT THE REBRANDING.
SO THIS, WE INCLUDED $1 MILLION IN, UH, OUR FORECAST TO COVER AUSTIN WATERS, ALL OF AUSTIN WATER'S RELATED COST TO THE REBRANDING, INCLUDING ESSENTIALLY INCLUDING EVERYTHING.
BUT WE LISTED A COUPLE THING HERE, WHICH IS UNIFORM AND A SYNERGY COST.
AND THEN THE NEXT LINE ITEM IS $0.7 MILLION INCREASE IN WILD LAND CONSERVATION, LAND MANAGEMENT, AND ALSO CONSERVATION PLAN CONSULTING SERVICE COST.
THAT'S TWO DIFFERENT PROJECTS THAT THEY'RE DOING.
AND, UH, UM, THEN WE GO, GO, GO
[00:10:01]
INTO SOME SMALLER AMOUNTS THAT, UH, WE HAVE SOME LARGE DIAMETER VALVES PUMPS, AND, UH, ALSO WE HAVE SOME ELECTRIC, UH, ELECTRIC MOTOR REPLACEMENT AND MAINTENANCE COST.WE CATEGORIZE THEM TOGETHER TO BE ABOUT $6.6 MILLION.
AND THEN WE ALSO HAVE SOME TREATMENT HAS SOME NEEDS FOR FILTER MEDIAN REPLACEMENT.
THAT'S ABOUT ANOTHER $0.6 MILLION.
AND BIO SOLIDLY USED SERVICE IS ANOTHER INCREASE OF $0.6 MILLION.
THE NEXT NUMBER IS ACTUALLY A DECREASE.
THE WE A HELP MANAGES OUR CUSTOMER CARE, RIGHT? SO THEY, DURING THE FORECAST PROCESS, THEY PROVIDED US A, UM, ESTIMATE OF A DECREASE FOR NEXT YEAR OF TWO POINT MILLION DOLLARS.
AND THEN THE LAST ACTUALLY, UM, AND JUST, UH, TO PROVIDE A LITTLE BIT MORE FRAMEWORK FOR THE UTILITY BILLING SYSTEM SUPPORT, UM, THAT, THAT NUMBER IS, UH, A NUMBER THAT'S ALLOCATED TO ALL THE DEPARTMENTS THAT AUSTIN ENERGY, UH, PROVIDES CUSTOMER CARE SERVICES FOR.
UH, SO IT'S, UH, YOU KNOW, AUSTIN WATER, UM, AUSTIN RESOURCE RECOVERY FOR, FOR SOLID WASTE PICKUP.
IT'S FOR THE, YOU KNOW, TRANSPORTATION USER FEE.
UM, THE, UM, YOU KNOW, WITH WATERSHED AND, AND YOU KNOW, THE DRAINAGE USER FEE.
UM, FOR US SPECIFICALLY, THE REASON FOR THE DECREASE IS AS WE ROLL OUT OUR, UM, THE, THE MY A TX WATER PROGRAM AND WE ROLL OUT THE, UM, YOU KNOW, SMART METERS, YOU KNOW, WE'RE NO LONGER HAVING TO HAVE THOSE METERS BE MANUALLY READ.
AND, AND SO THE WAY THE ALLOCATION WORKS, IT'S BASED ON THE PRIOR YEAR, UM, ACTUAL COST.
AND, AND SO FOR IN, IN THIS CASE, BASED ON FY 24 COST, WHERE, YOU KNOW, LESS THAN HALF OF OUR METERS HAD AT THE TIME HAD BEEN, YOU KNOW, BY THE END OF THE YEAR HAD BEEN TRANSITIONED TO, UM, YOU KNOW, THE AUTOMATED, UH, YOU KNOW, AUTOMATED METER READING.
AND, UH, AS WE CLOSE OUT THE A MI PROJECT, YOU KNOW, WE EXPECT, YOU KNOW, NEXT YEAR TO SEE ANOTHER DECREASE AS WE, YOU KNOW, IT'LL BE BASED ON FY 25 WHEN, YOU KNOW, BY THE END OF FISCAL YEAR 25, WE WERE, WE WERE ABOUT 95% COMPLETE.
SO, SO THAT'S THE, THE BIGGEST DRIVER IN TERMS OF, OF THE REDUCTION IN THE UTILITY BILLING, UH, SYSTEM SUPPORT, AND, YOU KNOW, SO IT'S ALL RELATED COST TO, UH, TO GENERATING BILLS AND, AND, AND, UH, PROVIDING CUSTOMER CARE FOR, UH, YOU KNOW, CITY OF AUSTIN UTILITY CUSTOMERS.
UM, OUT OF CURIOSITY, IT'S THE, MY ETX, DOES IT END UP BEING CHEAPER, MORE COST EFFECTIVE? YE YES.
UH, I THINK GENERALLY MORE, MORE COST EFFECTIVE.
UM, YOU KNOW, IT'S NOT A SIGNIFICANT REDUCTION.
UM, YOU KNOW, IN, IN TERMS OF METER READING COSTS, YOU KNOW, I THINK FY 24, AND I'D HAVE TO CONFIRM THE NUMBER, BUT IT WAS ABOUT THREE, THREE AND A HALF MILLION DOLLARS.
AND, AND SO THAT'S A SIGNIFICANT PORTION OF OUR ROUGHLY $21 MILLION ALLOCATION.
UM, YOU KNOW, WE, WE DID HAVE, YOU KNOW, TO IMPLEMENT, UM, THE DATA COLLECTION UNITS AND THE NETWORK SYSTEM, UH, BUT THE, THE, YOU KNOW, RETRIEVING THE DATA, YOU KNOW, IS GONNA COST US A LITTLE BIT LESS THAN THE MANUAL METER, METER READING PROCESS.
AND THE NEXT CATEGORY IS THE NEW IMPACT OF THE NEW POSITIONS.
AND WE HAVE INCLUDED IN THE FORECAST ONE, UH, 13 NEW FTES.
ALL OF THESE 13 NEW FTES ARE TEMPORARY EMPLOYEE CONVERSION.
AND, UH, THAT COMES OUT TO BE ABOUT $1.5 MILLION INCREASE.
SO ANY QUESTIONS ON THIS LIST OF THE COST DRIVERS? AND JUST REAL QUICK, UH, ADD A LITTLE BIT OF, UH, INFORMATION REGARDING THE, YOU KNOW, THE FORECAST PROCESS AND THE FORECAST PROCESS FOCUSES ON, YOU KNOW, MAINTAINING KIND OF OUR, OUR, OUR BASE COST.
UM, AND ALTHOUGH WE ANTICIPATE, UM, AND WE HAVE ASKED FOR ADDITIONAL POSITIONS IN THE PROPOSED BUDGET, UH, THE FORECAST FOCUSES ON, UH, MAINTAINING EXISTING COSTS.
SO FROM AN FTE PERSPECTIVE, A, YOU KNOW, FULL-TIME, YOU KNOW, EMPLOYEE FULL-TIME EQUIVALENT, UM, THESE 13 POSITIONS, SINCE THEY'RE ALREADY IN OUR COST STRUCTURE ARE, ARE, ARE BASICALLY IN, IN OUR BASE COSTS.
UM, AND THEN ANY, ANY NEW POSITIONS BEYOND THAT WILL BE ADDED, UH, OR
[00:15:01]
PROPOSED WITHIN OUR BUDGET PROCESS, UM, AS ENHANCEMENTS, COMMISSIONERS.ANYBODY HAVE ANY QUESTIONS ON THAT SPECIFIC ITEM? ANY INFORMATION PROVIDED? MM-HMM
UM, JUST AN, AND ALSO I MENTIONED AS WELL, I WASN'T ABLE TO MAKE THE PREVIOUS ONE, SO APOLOGIES IF SOME OF THE INFORMATION WAS PRESENTED IN THE PAST.
UM, THESE INCREASES THAT ARE SHOWN HERE AS WELL AS THE AMENDED 2025 VERSUS THE FORECAST OF 2026 PERCENTAGE INCREASES PER ITEM, IS THAT GENERAL GENERALLY IN LINE WITH PREVIOUS FORECAST VERSUS THE PRIOR YEARS? I THINK THERE'S LIKE A SEVEN AND A HALF PERCENT INCREASE FROM 25 TO 26.
HOW DOES THAT COMPARE TO OTHER PREVIOUS YEARS AS YOU'VE DONE THIS FORECASTING? LET'S SAY, WHEN YOU FORECAST THE 25 VERSUS AMENDED 24 AND SO ON, IS IT GENERALLY IN LINE? UM, IF WE COULD SCROLL UP, UP TO THE TOP.
NO, ACTUALLY I, YOU CAN SEE IT.
THE, SO IN, IN TOTAL, UM, THE, THE INCREASE, UH, FOR THE FY 26 FORECAST OVER THE CURRENT YEAR, UH, AMENDED BUDGET, NOW, WE HAVEN'T HAD ANY, ANY BUDGET AMENDMENTS THAT HAVE CHANGED THE TOTAL BUDGET FOR THE YEAR, BUT WE HAVE HAD BUDGET AMENDMENTS WHERE WE SHIFT FUNDS AROUND WHERE WE HAD SOME, AN UNANTICIPATED COSTS, AND WE, WE UTILIZE, YOU KNOW, EXISTING FUNDING LINES.
UM, SO IN TOTAL, OUR AMENDED BUDGET IS, IS THE SAME AS OUR, UH, YOU KNOW, APPROVED BUDGET.
UH, BUT THAT 58 MILLION IS, IS, UM, YOU KNOW, HIGHER THAN WE'VE SEEN HISTORICALLY IN, IN PRIOR YEARS.
TYPICALLY, WE SEE, YOU KNOW, AN INCREASE OF, YOU KNOW, BETWEEN 20 MILLION AND UP, UP TO ABOUT 30 MILLION.
UH, WE ARE STARTING TO SEE THE IMPACT OF OUR GROWING CAPITAL PLAN, YOU KNOW, STARTING WITH, WITH FISCAL YEAR 26.
SO, UM, YOU KNOW, THE, THOSE FIRST TWO LINES IN THE DEPARTMENT WIDE COST DRIVERS, YOU KNOW, 21 MILLION FOR, UM, CIP CASH FINANCING IS A BIG PART OF THAT.
AND THEN 15 MILLION IN, IN DEBT SERVICE REQUIREMENTS AS OUR CAPITAL PROGRAM HAS GROWN, UM, AND OUR DEBT SERVICE REQUIREMENTS ARE, ARE INCREASING.
SO ALL TOLD, UM, YOU KNOW, OF THE 58 MILLION, ROUGHLY 70% IS RELATED TO OUR CAPITAL PROGRAM, BOTH, YOU KNOW, THE AMOUNT THAT WE ARE PAYING UPFRONT, KIND OF LIKE A, UM, YOU KNOW, PUTTING A BIGGER DOWN PAYMENT ON A MORTGAGE TO, TO, TO LOWER YOUR, UH, MORTGAGE PAYMENTS OR, OR, OR A CAR, UM, THAT'S WHAT THAT CASH FINANCING REPRESENTS.
UM, AND WE HAVE A FINANCIAL POLICY THAT THAT INDICATES THAT WE WOULD TARGET, UH, BETWEEN 35 AND 50% CIP CASH FINANCING FOR, FOR OUR ANNUAL CIP SPENDING.
UM, SO A BIG PART OF THAT, YOU KNOW, THAT 21 MILLION INCREASE IS JUST TRYING TO, TO MAINTAIN, UM, COMPLIANCE WITH, WITH THAT FINANCIAL POLICY.
HAVING SAID THAT, AND WE DID TALK ABOUT THIS LAST TIME, AND I'LL, I'LL KINDA GO THROUGH IT BRIEFLY.
UM, AS WE, YOU KNOW, WENT THROUGH OUR COST OF SERVICE STUDY LAST YEAR, UM, THAT LEVEL OF CIP CASH FINANCING WAS ONE OF THE BIG DISCUSSION POINTS IN, IN OUR COST OF SERVICE STUDY, UM, PARTICULARLY AS IT PERTAINS TO OUR, OUR WALNUT CREEK, UM, YOU KNOW, UPGRADE AND EXPANSION, YOU KNOW, WITH A PROJECT THAT SIZE.
AND WHEN WE TARGET, UM, YOU KNOW, A MINIMUM OF 35% CASH FINANCING OF 35% DOWN PAYMENT, IF YOU WILL, UM, YOU KNOW, THAT'S, THAT'S A BIG BURDEN FOR TODAY'S CUSTOMERS FOR A PROJECT THAT'S GONNA LAST 50 YEARS, RIGHT? AND SO WE RECOGNIZE THAT, UM, YOU KNOW, IT, IT'S, UH, NOT REALLY FAIR TO ASK TODAY'S CUSTOMERS TO PAY FOR MORE THAN A THIRD OF A PROJECT THAT'S GONNA SERVE CUSTOMERS, YOU KNOW, FOR, FOR 50 YEARS.
AND, UH, YOU KNOW, AS WE TALKED TO OUR, OUR CUSTOMER GROUPS AND CUSTOMER CLASS REPRESENTATIVES, YOU KNOW, WE, WE, UM, SET A, A NEW TARGET THAT WE STILL NEED TO FORMALIZE IN TERMS OF FINANCIAL POLICY, BUT, YOU KNOW, FOR, FOR THOSE LARGE GENERATIONAL PROJECTS TARGETING MORE IN THE 20% RANGE, UH, FOR THOSE LARGE GENERATIONAL PROJECTS, AND THEN 35 TO 50% FOR, FOR THE REMAINDER OF OUR CAPITAL PROGRAM, AND WE THINK THAT THAT'LL STRIKE, YOU KNOW, GOOD BALANCE OF, OF, YOU KNOW, KEEPING OUR DEBT SERVICE COSTS LOW.
ONE OF THE REASONS THAT THAT'S REAL IMPORTANT IS ONE OF OUR, ANOTHER, YOU KNOW, ANOTHER ONE OF OUR FINANCIAL POLICIES IS, YOU KNOW, OUR DEBT SERVICE COVERAGE FINANCIAL POLICY.
AND, AND THAT POLICY SAYS THAT WE SHOULD MAINTAIN 1.75 TIMES DEBT SERVICE COVERAGE, UH, FOR EVERY DOLLAR OF ANNUAL DEBT.
[00:20:01]
IS WHEN YOU TAKE OUR OPERATING REVENUES AND YOU SUBTRACT OUT OPERATING EXPENSES, THE LEFTOVER AMOUNT SHOULD BE AT LEAST 1.75 TIMES OUR ANNUAL DEBT SERVICE REQUIREMENTS.AND SO FROM A RATE PERSPECTIVE, WHAT THAT MEANS IS EVERY DOLLAR OF DEBT SERVICE THAT WE CARRY REQUIRES THAT WE, YOU KNOW, GENERATE A DOLLAR 75 IN RATES TO, TO MAINTAIN THAT FINANCIAL POLICY.
AND I'LL, I'LL NOTE THAT 1 75 IS KIND OF ON THE LOW END IN TERMS OF, OF, OF OUR PEERS.
UH, BUT WE ARE STRONG ENOUGH UTILITY WHERE WE CAN BE ON THE LOWER END, UM, AND, AND, AND STILL HAVE ADEQUATE LEVEL OF FINANCIAL, UH, YOU KNOW, RESERVES AND SUPPORT TO, TO, TO COVER THAT KIND OF, UH, CAPITAL SPENDING AT, AT, AT THOSE LEVELS.
UM, SO OVER THE LAST 10 YEARS SINCE, YOU KNOW, REALLY SINCE 2016, WE'VE BEEN REALLY HEAVILY FOCUSED ON MANAGING OUR DEBT SERVICE REQUIREMENTS TO KEEP 'EM AS LOW AS POSSIBLE.
'CAUSE WE UNDERSTAND, AGAIN, THAT EVERY DOLLAR OF DEBT, YOU KNOW, HAS THAT DEBT SERVICE COVERAGE MULTIPLIER.
AND, UH, SO THAT $21 MILLION IS, IS, UM, YOU KNOW, TAKES INTO ACCOUNT A LOWER PERCENTAGE FOR WALNUT CREEK, UM, AND THEN TRIES TO, TO MAINTAIN ROUGHLY 35% FOR THE REMAINING PIECE.
AND THEN AGAIN, UH, YOU KNOW, AS OUR, OUR CAPITAL PROGRAM HAS GROWN OVER THE LAST FEW YEARS, WE ARE STARTING TO SEE THAT INCREASE IN ANNUAL DEBT SERVICE REQUIREMENTS.
UM, AND THEN ONE LAST THING I WOULD WOULD NOTE IS, UM, ONE OF THE WAYS THAT WE'VE TRIED TO MANAGE DEBT SERVICE COSTS IS, UH, BY TAKING CAPITAL RECOVERY FEES OR IMPACT FEES, THOSE ARE THE COSTS THAT DEVELOPERS PAY TO CONNECT TO OUR SYSTEM.
UM, OVER THE LAST 10 YEARS, WE'VE BEEN USING CAPITAL RECOVERY FEES TO, TO DE FEES DEBT, PAY DOWN DEBT EARLY, LIKE MAKING AN EXTRA CAR PAYMENT OR A MORTGAGE PAYMENT.
UM, WITH, UH, ALTHOUGH WE'RE, WE'RE ABLE TO TARGET SPECIFIC YEARS, SO FOR EXAMPLE, IF, YOU KNOW, IN 2028, YOU KNOW, WE'RE EXPECTING, YOU KNOW, WE, WE HAVE SCHEDULED DEBT SERVICE THAT'S GONNA BE OUR PEAK YEAR, UM, OVER, YOU KNOW, REALLY OVER THE LAST 20 YEARS, IT'S, IT'S GONNA BE OUR PEAK YEAR, AND THEN IT'LL START TO DROP OFF.
UM, SO WE'VE ALREADY STARTED TARGETING, UH, 2028, UM, IN TERMS OF TRYING TO REDUCE THAT, THAT PEAK.
UM, AND, AND SO THE CHALLENGE THAT WE'RE FACING FROM, FROM A DEFIANCE PERSPECTIVE AND A CAPITAL RECOVERY FEE PERSPECTIVE IS DEVELOPMENT HAS STARTED TO SLOW.
UH, WE HAD PEAK CAPITAL RECOVERY FEES IN 2022 AT ABOUT 44 MILLION, UH, LAST YEAR.
WE ENDED THE YEAR, YOU KNOW, A LITTLE BELOW 29 MILLION.
SO WE HAVE A LITTLE BIT LESS CAPITAL RECOVERY FEE MONEY TO, TO, YOU KNOW, MANAGE OUR, OUR, OUR DEBT SERVICE, UH, REQUIREMENTS.
UH, BUT WE STILL, YOU KNOW, IN THE $30 MILLION RANGE, YOU KNOW, WE'RE STILL ABLE TO DO QUITE A BIT WITH, WITH THAT.
DOES THAT ANSWER YOUR QUESTIONS? OKAY, GREAT.
WE'LL SEE NO OTHER QUESTIONS ON THAT.
ITEM NUMBER TWO, WE'LL MOVE ON TO, UM, THE ITEM NUMBER THREE,
[3. Austin Water Financial Forecast New FTEs]
WHICH IS AUSTIN WATERS FINANCIAL FORECAST, NEW FTES.SO THIS IS A LIST OF THE 13 NEW FTES THAT WE PROPOSED, UH, DURING THE FORECAST PROCESS.
LIKE JOSEPH MENTIONED EARLIER, THIS IS WHAT BUDGET OFFICE CONSIDERED AS THE BASE OPTION, UH, FOR THE NEW FTES.
AND WE DID PROPOSE SOME ADDITIONAL ENHANCEMENT, NEW FTES, UH, WHICH ARE NOT PART OF THIS 13, AND THEY ARE CURRENTLY BEING REVIEWED BY THE BUDGET OFFICE AS PART OF THE BUDGET DEVELOPMENT PROCESS.
AND SO WE CATEGORIZED THESE, UH, NEW FTES BY UM EFFECTIVE UTILITY MANAGEMENT ATTRIBUTES.
SO I WON'T GO THROUGH, UH, THEM ONE BY ONE.
UH, SO LET US KNOW IF YOU HAVE ANY QUESTIONS AND IF YOU NEED TO, UH, SEE ANY MORE DETAIL ON ANY PARTICULAR ONES.
AND I, I WOULD JUST POINT OUT OF, OF THE 13, UM, YOU KNOW, SIX OF 'EM ARE, UM, YOU KNOW, IN THE OPERATIONAL RIGHT, RIGHT THERE, OPERATIONAL OPTIMIZATION GROUP, UH, WHETHER THAT'S OPERATION STAFF, UH, YOU KNOW, WHETHER THAT'S OPERATION STAFF OR OPERATION SUPPORT STAFF, FOR EXAMPLE, UM, YOU KNOW, HEALTH AND SAFETY SPECIALIST.
[00:25:01]
SO, YOU KNOW, AS IS, YOU KNOW, KIND OF TYPICAL FOR, YOU KNOW, OUR, OUR FTE ASK IN IN GENERAL, YOU KNOW, WE, WE, WE GENERALLY HAVE A STRONG FOCUS ON OPERATIONAL OPTIMIZATION.UM, WE'RE ALSO STARTING TO SEE, UM, YOU KNOW, IN, IN TERMS OF WATER FORWARD, SOME, SOME POSITIONS THAT, UH, YOU KNOW, FOR EXAMPLE, WATER RESOURCE SUSTAINABILITY.
YOU KNOW, WHEN WE, IF YOU LOOK BACK AT PRIOR YEARS WHEN WE CATEGORIZE 'EM BY, UH, EFFECTIVE UTILITY MANAGEMENT ATTRIBUTES, UH, THIS IS THE FIRST YEAR YOU'RE, YOU'RE, YOU'RE REALLY STARTING TO SEE, UH, WATER RESOURCE SUSTAINABILITY AND THAT THAT JUST GOES HAND IN HAND WITH THE WORK THAT WE'VE BEEN DOING, YOU KNOW, IN TERMS OF WATER FORWARD, UM, AND, AND, AND IMPLEMENTING WATER FORWARD, UH, STRATEGIES.
SO I WOULD IMAGINE THE CITY OF AUSTIN WOULD HAVE, LIKE, PROVIDED IT SUPPORT ACROSS THE WHOLE CITY IN ORDER TO LIKE, YOU KNOW, TRIM COST AND ALL THAT STUFF.
AND SO I SEE THE TWO POSITIONS, AND OBVIOUSLY AUSTIN WATER, YOU KNOW, HAS SPECIALIZED SOFTWARE AND DIFFERENT THINGS, AND I CAN UNDERSTAND THAT.
I JUST WONDERING HOW DOES THE CITY OF AUSTIN DO THEIR IT SUPPORT THROUGHOUT ALL THE DEPARTMENTS? OR IS IT JUST INDIVIDUAL DEPARTMENTS ARE JUST LEFT TO DEVELOP THEIR OWN PROGRAM? WE, THE, THE CITY OF AUSTIN DOES HAVE A, A, A CITYWIDE I IT FUNCTION, UH, CALLED COMMUNICATIONS AND TECHNOLOGY MANAGEMENT, CTM, UM, AND, AND THEY PROVIDE KIND OF A, A BROAD OVERALL SUPPORT TO, TO THE CITY.
UH, LARGER DEPARTMENTS, UH, WITH SPECIALIZED NEEDS HAVE THEIR OWN IT STAFF, AND SO THEY KIND OF WORK TOGETHER HAND IN HAND.
I WILL SAY THAT, UM, THE CITY IS UNDERTAKING A REVIEW OF, UM, IT ORGANIZATIONAL STRUCTURE AND, UM, YOU KNOW, SO THAT THAT MODEL MAY BE TWEAKED AS A, YOU KNOW, KIND OF AN OUTCOME OF, OF THAT PROCESS.
I BELIEVE THAT PROCESS IS CURRENTLY KICKING OFF.
UM, BUT, UM, YOU KNOW, FOR, FOR LARGER DEPARTMENTS, AGAIN, WITH SPECIALIZED NEEDS AND SPECIALIZED APPLICATIONS, UH, CTM KIND OF SUPPORTS THE NETWORK AND, AND THE INFRASTRUCTURE.
BUT IF THERE'S SPECIALIZED APPLICATIONS THAT A, A DEPARTMENT HAS, THEN, UH, PARTICULARLY A LARGER DEPARTMENT, THEN THOSE APPLICATIONS WOULD GENERALLY BE MAINTAINED BY, YOU KNOW, INTERNAL DEPARTMENTAL STAFF, AND THAT'S HOW WE'RE STRUCTURED.
THE, IS THERE OBVIOUSLY TEMPORARY POSITIONS THAT ARE BEING CONVERTED TO PERMANENT? ARE THE STAFF THAT ARE CURRENTLY IN THEM GOING TO REMAIN? GENERALLY WHEN, WHEN WE, YOU KNOW, EVEN IF WE'RE, UM, WE'VE IDENTIFIED A POSITION TO CONVERT FROM TEMPORARY TO PERMANENT, UM, SOME OF THOSE TEMPORARIES MAY BE, FOR EXAMPLE, RETIREES WHO, WHO, YOU KNOW, COULDN'T RETURN AS ON A FULL-TIME BASIS.
UH, BUT, BUT EVEN IN POSITIONS WHERE THEY'RE NOT RETIREES, UM, THOSE EMPLOYEES, YOU KNOW, COULD BE CANDIDATES FOR THE POSITION, BUT WE GENERALLY POST THEM COMPETITIVELY, UM, AND, UM, YOU KNOW, DON'T APPOINT, UH, AN EXISTING TEMPORARY INTO THOSE POSITIONS.
UM, WE CAN MOVE ON TO ITEM NUMBER FOUR,
[4. Austin Water Capital Spending Plan Update]
WHICH IS THE AUSTIN WATER CAPITAL SPENDING PLAN UPDATE.CHRISTINA ROMERO, AUSTIN WATER FINANCIAL MANAGEMENT.
SO HERE WHAT YOU'RE SEEING IS A SUMMARY OF THE AUSTIN WATER UTILITY FOR THE FIVE YEARS, UM, FOR FY 2025, WHICH IS THE CURRENT YEAR TO 2029.
SO THIS IS THE APPROVED PLAN FROM, UH, LAST FISCAL YEAR THAT WE'RE SHOWING YOU.
UM, OUR CURRENT PLAN IS STILL UNDERGOING REVIEW, UH, WITH THE BUDGET PROCESS, BUT WHAT WE FOUND IS AS WE ROLLED THIS PLAN OVER, THERE WASN'T A LOT OF SIGNIFICANT CHANGES IN PROJECTS AT ALL.
UH, WE ARE CARRYING THE SAME PROJECTS, UH, WHICH WE'RE FINDING IS THE LARGEST THAT, THAT JOSEPH MENTIONED EARLIER, WHICH IS A WALNUT CREEK, A WASTEWATER TREATMENT PLANT.
THAT'S, THAT'S STILL THE LARGEST PROJECT.
UM, AND SO WE SHIFTED THE PLAN BY ONE YEAR.
BUT WHAT YOU'RE SEEING HERE IS A GOOD, UH, OVERVIEW OF WHAT THE PLAN CONTINUES TO LOOK LIKE.
UH, ESPECIALLY FOR THIS YEAR, UH, WE'RE SHOWING THAT WE ANTICIPATE TO SPEND $350 MILLION THIS YEAR IN CIP AND WE ARE ON TARGET.
SO RECLAIMED, UH, WE'RE LOOKING AT ABOUT 16.8 MILLION.
[00:30:01]
WATER IS ABOUT 120.6 MILLION, AND WASTEWATER IS 213.1 MILLION.AND, UM, AS YOU CAN TELL, WE ARE A WASTEWATER HEAVY.
AND AGAIN, THAT'S, UH, DUE TO THOSE PRO THAT PROJECT.
UM, SO OUR TOTAL FIVE YEAR PLAN HERE IS, UH, TWO POINT, ALMOST 2.3, UH, BILLION DOLLARS.
UH, AT THE TAIL END OF THE PLAN COMES A SR SO THAT'S OUR AQUIFER STORAGE AND RECOVERY.
SO AS WE WRAP UP WALNUT, WE GO STRAIGHT INTO A SR AND THERE IS SOME A SR PILOT PROJECT BEFORE THE FULL SCALE A SR AND I'LL JUST HIGHLIGHT A COUPLE OF OTHER PROJECTS.
UM, SO IT'S NOT JUST THE WALNUT CREEK EXPANSION, BUT THE WALNUT CREEK PRIMARY CLARIFIER AND FLOW EQUALIZATION BASED IN REHAB, SOUTH AUSTIN REGIONAL WASTEWATER TREATMENT PLANT TRAINS, A AND B WILLIAMSON CREEK WASTEWATER INTERCEPTOR, AND AGAIN, THE AQUIFER STORAGE AND RECOVERY.
AND THOSE ARE THE LARGEST PROJECTS YOU WILL FIND THROUGHOUT, UM, YOUR SUPPORT.
AND SO WHAT WE PROVIDED YOU IS A DETAILED LISTING.
WE'LL SEND THAT OVER ELECTRONICALLY AS WELL.
'CAUSE IT CAN BE HARD TO READ ON ALL THOSE PAGES, UH, FOR SURE.
BUT IF YOU HAVE ANY QUESTIONS, UM, I'M HAPPY TO HELP ANSWER.
AND THEN I, I, I WOULD JUST ADD, YOU KNOW, IF, IF YOU LOOK AT THE TOTALS AT THE BOTTOM, YOU CAN SEE KIND OF THE RAMP UP, UM, PARTICULARLY FOR, FOR YEARS 26 AND IN 27.
UM, AND, AND JUST FOR SOME HISTORICAL CONTEXT, UH, YOU KNOW, I BELIEVE WE ENDED 2024, UH, AT ABOUT $260 MILLION OF ANNUAL CIP SPENDING.
UM, SO THREE 50, YOU KNOW, REPRESENTS ALMOST A HUNDRED MILLION DOLLARS INCREASE.
BUT AS WE GET INTO, YOU KNOW, 500 PLUS FOR, FOR 26 AND 27, THE, THAT'S, YOU KNOW, THE REALLY BIG COST DRIVER AS WE LOOK AT, UH, YOU KNOW, WHAT'S ON THE HORIZON AND, AND, AND WHAT'S GONNA BE DRIVING OUR RATES, BOTH FROM A, A DEBT SERVICE PERSPECTIVE AND ALSO, YOU KNOW, THE, THE CIP FINANCING, THE, THE DOWN PAYMENT PERSPECTIVE.
UM, AND, AND, AND TRYING TO FIND A GOOD BALANCE OF THOSE TO MINIMIZE RATE IMPACTS, UH, GOING FORWARD.
UM, THE OTHER THING I, I WOULD, UM, JUST POINT OUT IS AS, AS WE LOOK TO, UM, YOU KNOW, THE 26TH THROUGH 30 PLAN, YOU KNOW, UM, AND, AND YOU'VE GOT THE DETAILS FOR THE EXISTING APPROVED, UH, PROJECTS, YOU KNOW, 95, ABOUT 95% OF THE NEXT PLAN IS GONNA BE PROJECTS IN THE CURRENT PLAN.
SO IT, IT'S REALLY JUST KEEP DOING WHAT WE'RE DOING AND, AND RECOGNIZING THAT WE'VE GOT SOME BIG PROJECTS ON THE HORIZON.
UM, YOU KNOW, WE'RE NOT ADDING A TON OF NEW PROJECTS, UH, OR WE'RE NOT PROPOSING TO ADD A TON OF NEW PROJECTS.
IT'S, UH, YOU KNOW, WITH THE THINGS THAT WE'VE GOT ON OUR PLATE, UH, THERE, THERE'S A LOT THERE.
AND, AND THAT'S GONNA BE OUR FOCUS OVER, YOU KNOW, THE NEXT FIVE TO SEVEN YEARS.
AND THE NEW CIP WILL BE POSTED ONCE THE BUDGET PROCESS IS COMPLETE.
SO YOU MENTIONED THE A SR, AND I KNOW, YOU KNOW, FOR PARTICULAR COMMISSION MEMBERS, YOU KNOW, THAT'S, UH, KIND OF A, A BIG, UH, PROJECT, YOU KNOW, FOR THE ALL OF AUSTIN WATER FORWARD PLAN AS I WAS JUST LOOKING AT THE NUMBERS.
UM, AND OBVIOUSLY AS YOU GET OUT INTO TWENTY SEVEN, TWENTY EIGHT, I DON'T WANNA CALL 'EM PLACEHOLDERS, BUT YOU KNOW, JUST THINKING ABOUT LIKE HOW THAT PROJECT COULD POTENTIALLY MOVE FORWARD, YOU KNOW, IS THERE A EXPECTATION THAT MAYBE, YOU KNOW, THERE'S LIKE, YOU KNOW, 23,000,027 AND 7,000,028, COULD THOSE NUMBERS, I DON'T WANNA SAY RADICALLY CHANGE, BUT COULD THAT MOVE? OR IS IT BECAUSE OF THE FIVE YEAR PLANNING? ARE THOSE SOMEWHAT, YOU KNOW, SET? I, I GUESS AS WE EMBARK MORE ON A SR, UM, I MEAN, I, I WILL SAY THAT, UM, YOU RAMPING UP, UH, FOR THE A, THE A SR PROJECT AND, AND EVEN GETTING, UM, THE PILOT LAUNCHED, UH, WE'RE, WE'RE A LITTLE BIT BEHIND WHERE, WHERE WE THOUGHT WE WOULD BE AT THIS POINT LAST YEAR.
UM, SO THOSE NUMBERS MAY SHIFT, UH, TO, UH, WITH THE PILOT TO PUSH IT OUT SOME.
UH, BUT I WOULD EXPECT THAT, YOU KNOW, I WOULDN'T EXPECT TO SEE ANY SIGNIFICANT CHANGE IN THE FULL SCALE, UH, TIMELINE.
WE'LL, WE'LL JUST HAVE TO KIND OF PLAY A LITTLE BIT OF CATCH UP.
I, I THINK, UM, BUT YOU KNOW, WITH EVERY YEAR, YOU KNOW, WHAT WAS IN THAT SIXTH YEAR, YOU KNOW, STARTS TO ROLL IN AS, AS THE FIFTH YEAR.
UM, AND, AND SO WITH EVERY YEAR YOU'LL START TO SEE MORE AND MORE OF THOSE COSTS PULL IN.
UM, YOU KNOW, WE, WE SUBMIT A FIVE YEAR FORECAST
[00:35:01]
TO, TO THE BUDGET OFFICE, AND THAT'S WHAT'S WHAT'S ASKED OF US.BUT WE, WHAT WORK TO DEVELOP A, A 10 YEAR FORECAST AND, UM, YOU KNOW, UH, BOTH FROM JUST, YOU KNOW, IN TERMS OF WHAT WE CAN HANDLE, BUT, BUT IN TERMS OF A PROJECT TIMELINE, UM, YOU KNOW, THE AQUIFER STORAGE AND RECOVERY PROJECT, UH, WE'LL, WE'LL TAKE US SOME TIME TO, TO GET OFF THE GROUND, UH, ONCE WE CAN, YOU KNOW, ONCE WE GET THROUGH THE PILOT, THEN WE WOULD EXPECT, UH, YOU KNOW, FOR THAT TO ACCELERATE.
AND THAT'S, THAT'S WHAT THE CURRENT, YOU KNOW, SPENDING PLAN LOOKS LIKE FOR THAT PROJECT.
UH, IT'S JUST, MOST OF THAT IS, IS MORE IN THE SECOND FIVE YEARS.
UM, AND, AND A LITTLE BIT BEYOND, UM, IN TERMS OF, OF OUR PLANNING.
UM, SO IT'S, IT'S, IT'S OUT THERE AND WE'RE PLANNING FOR IT.
IT'S JUST, YOU KNOW, NOT IN THIS FIVE, YOU KNOW, THE, THE BULK OF THE EXPENSES ARE BEYOND THE FIVE YEAR TIMELINE.
AND I'LL ADD, UM, AS WELL AS FAR AS THE, UH, VARIATION BETWEEN YEARS, EVERY TIME WE UPDATE A NEW PLAN, UH, AS WE GET NEW INFORMATION, UH, MORE SOLIDIFIED NUMBERS, UH, SOME OF THOSE NUMBERS CAN CHANGE FROM YEAR TO YEAR, BUT, UH, WE BALANCE THAT OUT, OF COURSE, LOOKING AT OUR DEBT SERVICE, LOOKING AT EACH PROJECT AND MAKING SURE, UH, YOU KNOW, WHAT ARE THOSE IMPACTS FROM YEAR TO YEAR, WHAT ARE THOSE PEAK YEARS IN DEBT SERVICE THAT WE NEED TO TARGET, UH, A LOT MORE.
AS YOU HAD MENTIONED THAT THE BULK OF THAT A SR PROJECT ISN'T IN THE CIP, IT'LL BE IN FUTURE CIPS.
WHAT IS THE EXPECTED, ANTICIPATED TENTATIVE TIMELINE FOR AN IMPLEMENTATION? LIKE IS IT 20 YEARS? IS IT 10, 15? LIKE WHAT, WHAT'S, I KNOW IT DEPENDS ON RAIN, BUT, WELL, IT, IT DEPENDS ON RAIN.
IT, IT, IT CERTAINLY DEPENDS ALSO ON, UM, YOU KNOW, WE ARE, WE'RE STILL WORKING THROUGH, YOU KNOW, A A LOT OF THE SPECIFICS IN TERMS OF EVEN, YOU KNOW, IDENTIFYING, YOU KNOW, EXACTLY WHERE, YOU KNOW, WE, WE'VE GOT A, YOU KNOW, A SENSE OF WHERE WE THINK IT'S GONNA BE.
BUT, YOU KNOW, IT'S NOT, THAT HASN'T BEEN, BEEN FINALIZED, I'D SAY, YOU KNOW, WE'RE, WE'RE LOOKING PROBABLY, YOU KNOW, 15, YOU KNOW, 15 YEARS OR SO, 15 TO 20 YEAR HORIZON.
BUT, YOU KNOW, UH, I, I THINK IN TERMS OF, OF OF SCALE AND PROJECT TIMELINE, IT'S, IT'S REALLY UNLIKE ANY PROJECT THAT WE'VE, WE'VE DONE.
IT'S, UM, YOU KNOW, IT'S, IT'S, IT'S NOT AS SIMPLE AS, UH, YOU KNOW, ACQUIRING PROPERTY, SAY, YOU KNOW, UH, EVEN IF WE WERE BUILDING A PLANT, RIGHT? ACQUIRING PROPERTY AND, AND, AND STARTING CONSTRUCTION, ALTHOUGH THERE IS, YOU KNOW, THERE, THERE'S A LOT OF TESTING INVOLVED IN TERMS OF THE WELLS.
UM, BUT YOU KNOW, THERE'S ALSO, UM, YOU KNOW, BECAUSE WE EXPECT IT, YOU KNOW, WE EXPECT THE AQUIFERS TO USE AQUIFERS THAT ARE OUT OF OUR IMMEDIATE, UH, YOU KNOW, VICINITY THERE, THERE'S A LOT OF PIPELINE WORK, UM, YOU KNOW, A LOT OF, UM, ACQUI, YOU KNOW, LAND ACQUISITION.
SO IT, IT, IT'S, IT'S GONNA BE PROBABLY ONE OF OUR MORE, YOU KNOW, LONGER TERM PROJECTS THAN, THAN, YOU KNOW, WHAT WE WOULD, WHAT YOU WOULD TYPICALLY SEE ON THE COMMISSION.
I DO THINK IT'S IMPORTANT FOR, I GUESS FOLKS TO UNDERSTAND THAT, RIGHT? UM, IT'S NOT, IT'S NOT GONNA MOVE AS QUICKLY AS, AS WE'RE USED TO THINGS MOVING AND THERE'S A LOT MORE TO CONSIDER.
AND, UM, JUST WANNA MAKE SURE THAT YOU EXPLAINED THAT ON THE, UM, LINE ITEM FOR THE HANCOCK WATER TREATMENT PLANT RESILIENCY IMPROVEMENTS PROJECT.
SO, YOU KNOW, HANCOCK IS ONE OF THE NEWER, OBVIOUSLY NEWEST, AND SO JUST LOOKING AT THE FIVE YEAR TOTALS AND, YOU KNOW, THE RESILIENCY, WHAT IS, I GUESS, ON A DOCKET FOR MAKING THAT NEW PLANT, I GUESS, MORE RESILIENT? SO PART OF IT IS JUST BEING ABLE TO, YOU KNOW, AS, AS WE TREAT WATER AT HANCOCK'S, BEING ABLE TO GET WATER IN INTO OUR SYSTEM.
AND SO, UM, YOU KNOW, IT'S, UH, WORKING ON OUR, OUR PUMP STATIONS TO, TO PUSH WATER OUT.
UM, BUT, BUT ALSO EVEN IN TERMS OF, OF, OF THE PLANT, UH, HAVING SOME REDUNDANCY, UM, YOU KNOW, IN CASE SOMETHING GOES DOWN.
UM, SO, YOU KNOW, ALTHOUGH THE, THE PLANT IS, IS RATED FOR, YOU KNOW, 50 MGD, YOU KNOW, IT'S, IT'S REALLY HARD FOR US TODAY TO, TO PUMP 50 MILLION GALLONS OUT OF, OUT OF, UH, YOU KNOW, HANCOCK'S TODAY.
AND SO IT'S, IT'S, UM, INCREASING OUR, OUR CAPACITY TO GET WATER OUT OF THE PLANT.
[00:40:01]
THAT WE CAN MAINTAIN, UH, YOU KNOW, WHEN WE TALK ABOUT RESILIENCY ON THE WATER TREATMENT PLANT SIDE, IT'S, YOU KNOW, WE'VE IDENTIFIED A MINIMUM LEVEL OF, OF TREATMENT CAPACITY THAT WE WANNA MAINTAIN AT, AT EACH PLANT IN ORDER TO MEET, UM, YOU KNOW, NOT NECESSARILY, YOU KNOW, WELL TO MEET PEAK DEMANDS.UM, AND, AND SO FOR, UM, FOR HANCOCKS, PART OF THAT IS, IS BEING ABLE TO, TO PUMP WATER OUT THAT, THAT WE, YOU KNOW, TECHNICALLY CAN TREAT IN THE PLANT, JUST, UH, NOT FULLY ABLE TO, TO GET INTO THE SYSTEM.
AND I'LL ALSO NOTE, UM, THAT ALL OF THE CITY'S PROJECTS ARE LISTED ON CAPITAL PROJECT EXPLORER.
AND SO IF YOU TYPE IN CAPITAL PROJECTS, UM, DOT AUSTIN TEXAS.GOV, YOU'LL BE ABLE TO LOOK AT ALL THE PROJECTS BY INFRASTRUCTURE TYPE IN DOLLAR AMOUNT.
OH, UM, THIS IS, YOU KNOW, IT'S A SMALL ITEM, BUT YOU KNOW, WHEN YOU SEE LIKE THE, UH, VEHICLES AND EQUIPMENT TOTAL, LIKE THE SAME AMOUNT ACROSS, UM, AND I WOULD ASSUME THAT YOU WOULD ABLE TO FIND, YOU KNOW, HAVE A PERCENT INCREASE FROM PREVIOUS YEARS.
I'M JUST WONDERING WHY THAT WAS KIND OF SET AS A, UM, SAME AMOUNT ACROSS ALL THE FIVE YEARS.
WELL, WHEN WE, WHEN WE SET THE FIVE YEAR PLAN, WE, YOU KNOW, UM, FOR, FOR INDIVIDUAL PROJECTS, YOU KNOW, WE LOOK AT, UM, YOU KNOW, HOW DOES A, HOW DOES A PROJECT OF THAT TYPE TYP TYPICALLY SPEND? AND SO A SPENDING, UH, YOU KNOW, SPENDING PLAN FOR A CONSTRUCTION TYPE PROJECT, YOU KNOW, HAS KIND OF A SET PROFILE.
UM, FOR OUR VEHICLE EQUIPMENT TOTAL, YOU KNOW, WE, WE TARGET, YOU KNOW, WE SET A FIVE YEAR TOTAL, AND THEN FOR, FOR THIS PURPOSE, WE JUST DIVIDE IT BY FIVE, WHICH GIVES US A LITTLE BIT OF FLEXIBILITY IN TERMS OF, OF HOW WE, HOW WE SPEND IT.
UM, BUT THAT SPENDING PLAN ISN'T, UM, AS, AS REFINED AS, UM, FOR EXAMPLE, A A CONSTRUCTION PROJECT WHERE, YOU KNOW, WE, WE KIND OF HAVE A SENSE OF, YOU KNOW, WHAT IT'S GONNA COST US IN DESIGN UPFRONT, HOW, HOW THE CONSTRUCTION SPEND IS, IS, IS GONNA LOOK.
UM, BUT FOR, FOR VEHICLES AND EQUIPMENT, IT'S REALLY JUST TAKING THE, THE TOTAL AND DIVIDING BY FIVE.
ANY OTHER QUESTIONS? OKAY, WELL THANK YOU GUYS FOR THAT.
WE'LL REVIEW, I GUESS AFTER THIS MEETING, PROBABLY HAVE A LITTLE MORE TIME TO GO OVER IT AND, AND LOOK AT IT IN A REALLY BIG SCREEN.
I THINK THE FOUR OR THE FIFTH ITEM UNDER THE DISCUSSION
[5. Discussion of the Water and Wastewater Commission Budget Recommendations Report]
ITEMS WAS THE WATER AND WASTEWATER COMMISSION BUDGET RECOMMENDATIONS REPORT.I THINK, UM, WE'VE MAYBE DISCUSSED THAT BEFORE, AND IT WAS MORE ALONG THE LINES OF WHAT YOU GUYS WANTED OR WHAT WE NEEDED TO PROVIDE TO YOU OR TO COUNCIL PRIOR TO THE BUDGET BEING, UM, PRESENTED TO THEM.
AND HIS, HISTORICALLY, THAT'S KIND OF BEEN, UM, YOU KNOW, A COLLABORATION OF, OF, OF THINGS THAT, YOU KNOW, EITHER WE'VE, WE'VE FOCUSED ON OR HIGHLIGHTED, UM, IN, IN THESE DISCUSSIONS.
UM, THINGS THAT, THAT, YOU KNOW, YOU GUYS WANNA HIGHLIGHT, UM, IN, IN TERMS OF, UH, YOU KNOW, WHAT ARE THE BIG THINGS THAT YOU GUYS ARE FOCUSING ON? AND, AND GENERALLY WE, WE LOOK AT THE, THE LAST YEAR'S RECOMMENDATION REPORT AND, UM, AND, AND TWEAK IT TO UPDATE ANY NEW FOCUS AREAS OR, UM, OR, OR THINGS, YOU KNOW, NOW THAT, UH, YOU KNOW, WE'VE GOT A COUPLE NEW MEMBERS ON, ON, ON THIS COMMITTEE, YOU KNOW, THINGS THAT, THAT YOU GUYS THINK ARE IMPORTANT TO, TO HIGHLIGHT IN TERMS OF A RECOMMENDATION TO COUNCIL.
I THINK IT'S USUALLY A KIND OF A SHORT OVERVIEW, A COUPLE PAGES TYPE OF SITUATION.
YEAH, I THINK HISTORICALLY IT'S BEEN TWO TO THREE PAGES.
AND, UM, AGAIN, UM, YOU KNOW, WE, WE HAVE HISTORICALLY WORKED TOGETHER WITH, UM, YOU KNOW, THE, THE CHAIR, UM, AND, AND THE COMMITTEE TO IDENTIFY, UM, YOU KNOW, ANY AREAS THAT WE WANNA UPDATE, AND THEN WE'LL, WE'LL FILL IN THE NUMBERS, YOU KNOW, UM, AND, AND, AND THAT KIND OF THING.
UM, AND SO IT'S, IT'S, UM, KIND OF A COLLABORATIVE EFFORT TO UPDATE THE RECOMMENDATION REPORT, UH, BUT WE, YOU KNOW, REALLY LOOK TO, TO YOU GUYS TO, UH, TO PROVIDE THE FOCUS AREAS AND THEN WE'LL, WE'LL MAKE SURE THE NUMBERS, YOU KNOW, ALL ALIGN.
[00:45:01]
SOUNDS GOOD.I HADN'T THOUGHT ABOUT THIS BEFORE, BUT IS THERE A BREAKDOWN OF CIP PROJECT EXPENDITURES PER DISTRICT? I'LL HAVE TO LOOK INTO THAT AND GET BACK TO YOU.
I KNOW THAT WE DO KEEP THE PROJECT BY DISTRICT.
I WANNA SAY IT'S ON CAPITAL PROJECT EXPLORER SITE, BUT I WILL DOUBLE CHECK THAT.
SO THE BUDGET REPORT TO THE COMMITTEE, DO WE, WE PRESENT THAT TO THE FULL COMMISSION, RIGHT? OR NOT, OR WE, I BELIEVE IN PAST YEARS IT'S BEEN PROVIDED AS AN ITEM ON THE AGENDA.
SO IT WOULD BE OUR, I GUESS IT WOULD BE AT THE NEXT MEETING, BECAUSE THAT'S AFTER, OR WE WOULD PRESENT IT BEFORE THAT BECAUSE IT NEEDS TO GO TO COUNCIL, BUT WE WOULD, UM, SHARE IT WITH THE REST OF THE COMMISSION AT THAT MEETING.
'CAUSE I GUESS, I GUESS, YOU KNOW, DOES THAT HAVE TO BE DONE BEFORE THE COUNCIL UH, MEETING? RIGHT, BECAUSE I MEAN, I THINK THAT'S LIKE, YES.
A DAY BEFORE, LIKE THE COUNCIL? NO.
UM, SO THE, JUST IN TERMS OF THE, THE OVERALL BUDGET TIMELINE, THE, THE INITIAL PRESENTATION TO COUNCIL WILL BE JULY 15TH.
UM, YOU KNOW, OUR, OUR NEXT COMMISSION MEETING JUST HAPPENS TO BE THE, THE FOLLOWING DAY.
UM, BUT, UH, THE, THE PURPOSE OF THE RECOMMENDATION IS TO TRY AND GET IT TO COUNCIL BEFORE BUDGET ADOPTION, WHICH THAT'LL BEGIN AUGUST 15TH.
UM, IN YEARS PAST, WE'VE, UM, YOU KNOW, WE'VE HAD KIND OF A SPECIAL CALL, UH, YOU, WE'VE SHIFTED THE DATE OF THE, OF THE MEETING, UM, YOU KNOW, OBVIOUSLY WITH SCHEDULES THAT'S A LITTLE BIT HARDER TO DO.
SO, YOU KNOW, WE OPTED TO KEEP THE, THE MEETING, YOU KNOW, THE FOLLOWING DAY, YOU KNOW, IN TERMS OF, OF, UM, THE PRESENTATION TO COUNCIL.
BUT, UM, THE GOAL IS NOT TO GET IT TO THEM BEFORE JULY 15TH.
IT'S TO GET IT TO 'EM BEFORE AUGUST.
IS IT 13TH OR 15TH? 13TH, YES.
AUGUST 13TH IS THE FIRST DAY OF ADOPTION.
UM, IN THE INTERIM BETWEEN JULY 15TH, UH, THERE WILL BE, YOU KNOW, THREE OR FOUR, I THINK THREE COUNCIL WORKSHOPS.
UM, THE ONE FOCUSING ON ENTERPRISE FUNDS DIRECTLY, I BELIEVE IS JULY 29TH OR JULY 30TH.
UM, AND, UH, UM, BUT, BUT EVEN AT THAT, SO WE WOULD EXPECT TO GET IT TO HIM BY THEN.
BUT EVEN WITH THAT, UM, REALLY THE GOAL IS TO GET IT TO HIM BEFORE, UH, BUDGET ADOPTION.
THIS IS HEATHER COOK, AUSTIN WATER CHIEF ADMINISTRATIVE OFFICER.
JUST WANTED TO ADD A NOTE THAT HISTORICALLY, JUST TO CLARIFY, UM, OUR NEXT, AS JOSEPH SAID, OUR NEXT FULL WATER WASTEWATER COMMISSION MEETING OF THE ENTIRE COMMISSION IS SCHEDULED FOR JULY 16, AS HE SAID, THE DAY AFTER COUNCIL RECEIVES THE BUDGET.
UM, SO WE HISTORICALLY HAVE ON THAT FULL COMMISSION AGENDA A RECOMMENDATION, AN ACTION FOR THE FULL COMMISSION TO MAKE A RECOMMENDATION ON THE BUDGET ITSELF.
SO THIS IS SEPARATE FROM THE REPORT OF THIS COMMITTEE THAT WE'RE TALKING ABOUT RIGHT NOW.
UM, SO THERE AGAIN, JOSEPH, WE COULD TALK AND WE COULD TALK AMONGST THE COMMISSION WHETHER THERE'S A NEED TO TRY TO FIND ANOTHER DATE FOR THE FULL COMMISSION TO MEET BETWEEN AFTER JULY 16 TO MAKE A RECOMMENDATION ON THE FULL BUDGET TO COUNCIL.
UM, AGAIN, THAT'S A SEPARATE ACTION FROM RECEIVING THE BUDGET COMMITTEE'S REPORT, BECAUSE THE BUDGET COMMITTEE'S REPORT IS A REFLECTION OF WHAT'S BEEN DISCUSSED IN THESE COMMITTEE MEETINGS, ESSENTIALLY.
AND IT CAN INCLUDE RECOMMENDATIONS FROM THE COMMITTEE, BUT IT CAN'T SPEAK TO THE FULL COMMISSION.
ONLY THE FULL COMMISSION CAN TAKE ACTION IN A PUBLIC MEETING TO MAKE A RECOMMENDATION TO THE FULL COUNCIL ON OUR ENTIRE PROPOSED BUDGET.
SO, AM I CONFUSING THINGS,
I MEAN, THERE THEY ARE TERMS OF THE, THE AGENDA TO, YOU KNOW, A COUPLE OF SEPARATE ITEMS, UM, YOU KNOW, WE WOULD PROVIDE A STAFF BRIEFING ON, ON THE BUDGET.
UM, AND I'M LOOKING AT LAST YEAR'S, UM, SO ON LAST YEAR'S COUNCIL, THERE WAS AN AGENDA ITEM TO APPROVE, UM, A RECOMMENDATION OF THE PROPOSED BUDGET REPORT ITSELF, THE REPORT THAT WE WOULD, UH, YOU KNOW, THAT WE WOULD HELP, UH, DEVELOP AND, AND THEN, UH, YOU KNOW, PROVIDE A RECOMMENDATION TO COUNCIL.
UM, SO IT'S TWO SEPARATE ITEMS. UM, SO THE BUDGET COMMITTEE REPORT JUST PROVIDES, YOU KNOW, A LITTLE BIT MORE OF A FRAMEWORK
[00:50:01]
AND, AND, UH, YOU KNOW, IN TERMS OF KEY FOCUS AREAS FOR, FOR THE BUDGET.SO IT JUST PROVIDES, YOU KNOW, BASICALLY A WRITEUP, UM, THAT GOES ALONG WITH, YOU KNOW, THE, THE, THE YES OR NO OF APPROVING, YOU KNOW, OR A RECOMMENDATION FOR THE BUDGET ITSELF.
SO IT PROVIDES, UM, YOU KNOW, SOME, SOME COMMENTARY.
SO CAN THAT HAPPEN ON JULY 16TH OR WOULD IT BE IT GETS PRESENTED ON JULY 16TH AND THEN WE HAVE TO MEET AGAIN? IT, IT CAN HAPPEN ON JULY 16TH.
UH, I WILL NOTE, UH, YOU KNOW, LAST YEAR, UM, THE MEETING, UH, WAS JULY 17TH, UH, WHICH, UM, I THINK LAST YEAR THERE WAS A LITTLE BIT MORE TIME, I THINK THE, THE PRESENTATION TO CITY COUNCIL MAYBE HAPPENED ON, IT HAPPENED THE FRIDAY BEFORE, SO I TRIED TO COUNT DATES.
UH, SO THAT WOULD'VE BEEN, UH, MAYBE JULY 12TH OR SO.
UM, AND SO IT WAS AGAIN, A SHORT TURNAROUND.
UM, BUT WHAT WE, WHAT WE TRY AND DO IN, YOU KNOW, IN THESE COMMITTEE MEETINGS, UM, AND, YOU KNOW, IN, UH, IN TERMS OF UPDATING THE, THE BUDGET RECOMMENDATIONS PROVIDE, UM, THE, THE KEY FOCUS AREAS THAT, THAT, YOU KNOW, WE THINK ARE DRIVING OUR BUDGET.
UM, AND, AND THAT'S WHY WE WORK HARD TO INCORPORATE THOSE THINGS INTO OUR FORECAST.
UM, SO, SO WHAT I'LL SAY IS THAT WE, WE DON'T ANTICIPATE A TON OF BIG, YOU KNOW, THE, THERE'S NOT GONNA BE A TON OF BIG CHANGES IN TERMS OF OUR FORECAST TO, TO OUR BUDGET.
UM, AND SO WE THINK YOU HAVE THE INFORMATION THAT YOU NEED TO, TO, YOU KNOW, HELP DEVELOP THAT RECOMMENDATION REPORT.
BUT IF YOU FELT LIKE YOU NEEDED MORE TIME, WE COULD CERTAINLY DO THAT.
UM, THE, THE, THE, THE CHALLENGE IS THE, IT WOULD LIKELY NEED YOU REQUIRE A SPECIAL CALL MEETING BECAUSE BUDGET ADOPTION, UM, STARTS ON THE 13TH, WHICH MAY BE THE SAME DAY, 'CAUSE IT'S A BUDGET ADOPTION STARTS ON WEDNESDAY, UM, WHICH IS, I BELIEVE WILL BE THE SAME DAY AS OUR NEXT SCHEDULED COMMISSION MEETING.
SO, SO THAT'S, THAT'S THE CHALLENGE.
IF, IF, IF, UH, WE NEED MORE TIME, WE WOULD JUST HAVE TO HAVE A SPECIAL CALL, UM, YOU KNOW, AROUND THE END OF JULY OR THAT FIRST WEEK OF AUGUST FOR THE FULL COMMISSION? NO, THE FULL COMMISSION IS AUGUST 20TH.
'CAUSE THAT'S THE THIRD WEDNESDAY.
SO AFTER, BECAUSE THE SIXTH IS THE FIRST WEDNESDAY.
SO IT'S THE 20TH IS, OH, THAT'S RIGHT.
WE SWITCHED TO THE THIRD COMMISSION.
SO WE WILL LOOK AT THE CALENDAR AND FIGURE OUT THE BEST WAY TO MAKE SURE THAT EVERYBODY HAS ENOUGH TIME TO REVIEW EVERYTHING AND WE CAN HOPEFULLY EXPEDITE THAT APPROVAL OR RECOMMENDATION.
AND THEN, LIKE, LIKE I SAID, I WOULD JUST NOTE, YOU KNOW, NOTE THAT ALTHOUGH THE PRESENTATION TO COUNCIL, SO LAST YEAR AND IN PREVIOUS YEARS, THE BUDGET WAS RELEASED THE SAME DAY THAT IT WAS PRESENTED TO COUNCIL.
UM, WHICH, YOU KNOW, LIKE LAST YEAR WAS THE FRIDAY BEFORE, YOU KNOW, OUR, OUR WEDNESDAY MEETING, FORTUNATELY, UM, THE BUDGET WILL BE RELEASED, YOU KNOW, I, I BELIEVE THAT FRIDAY BEFORE.
SO WE'LL ALLOW FOR SOME TIME TO REVIEW.
NOT A TON OF, YOU KNOW, OBVIOUSLY NOT A TON OF TIME.
UH, BUT IF THERE, YOU KNOW, AGAIN, IF THERE IS A, A DESIRE TO HAVE A LITTLE BIT MORE TIME THAT WE CAN LOOK AT, UH, YOU KNOW, OPTIONS TO, YOU KNOW, TO HAVE A SPECIAL CALL MEETING.
AS THAT WAS THE FINAL DISCUSSION ITEM LISTED, UM, WE'LL MOVE ON TO
[6. Review and possible action for future meeting schedule]
POSSIBLE ACTION ITEMS. AND I THINK, YOU KNOW, REVIEWING THE POSSUM, IT'S WHAT WE WERE JUST TALKING ABOUT, THE FUTURE MEETING SCHEDULE.UM, SO WE WILL EVALUATE THAT AND FOLLOW UP IF THERE'S A NEED.
COMMISSIONERS, DO YOU HAVE ANY OTHER QUESTIONS FOR THE O WATER STAFF? I DO HAVE, UM, WANTED TO FOLLOW BACK UP ON THE CAP.
UH, THE DISTRICTS ACTUALLY ARE IN THE COLUMN.
YOU'LL BE ABLE TO SEE THEM MORE CLEARLY.
UM, SORRY, AGAIN, THIS IS SO SMALL, BUT ALSO I JUST WANNA NOTE TOO, ON CAPITAL PROJECTS EXPLORER, UM, THERE'S A MAP AND YOU CAN CLICK ON THE COUNCIL DISTRICT THAT YOU WANNA SEE AND IT'LL POP UP ALL THE PROJECTS FOR THAT DISTRICT AS WELL.
FIGURED THE COUNCIL MEMBERS WOULD WANT NUMBERS.
[00:55:03]
GREAT.WELL THANK YOU FOR FOLLOWING UP ON THAT.
UM, IF THERE AREN'T ANY MORE QUESTIONS, ANY OTHER ITEMS TO ADDRESS, I WILL ADJOURN THE MEETING AT 1 56.