[4:53] This notice of public hearing Thursday, August 27th, 2026, 6:30 p.m. Part one.

[4:59] The city of Cachula City Council will conduct a public hearing on Thursday,

[5:03] August 27th at 6:30 at the Old Stockman's Bank building located at 101

[5:08] North Front Street, lot 10, Cula, Texas, 78014. This is a public hearing in which

[5:15] city business will be discussed, but no official action will be taken. A quorum

[5:20] of the city council will be present and the minutes kept. So, we call this

[5:24] hearing to order and we establish quorum. City Secretary, please call

[5:28] roll.

[5:34] » Here,

[5:37] » here.

[5:41] » Here.

[5:46] This is uh to conduct. This is number three. conduct public hearing

[5:50] considering establishing a guidelines and criteria governing tax abatement for

[5:54] economic development prospects in Cula, Texas. David,

[5:59] » so the general hearing for prospects like it says it's not specific to Cipher

[6:04] uh digital even though it was prompted by Cypher Cipher Digital. This is for

[6:09] any for any business that wants to come into Cthulhu that's a major business

[6:14] that we have the city has an actual process to actually um take their

[6:19] application deal with everything that they need to be taken care of. If

[6:22] they're looking for a tax abatement or something like that, the city has an

[6:26] actual process to do it. Um currently the city has no process to handle any

[6:30] type of project of this magnitude. So, uh this is what the hearing is for.

[6:40] on on the public hearing for tax abatement. Any any information or did

[6:45] anybody sign up to to speak on this one? Is there allowed to speak on that on the

[6:50] hearing? >> Yes. So, this is for you.

[6:56] » Thank you. >> Okay. Absolutely. So, this is a for

[7:01] public comment. this is for you and how you feel about establishing guidelines

[7:05] and criteria for uh the governing body for tax abatements and economic

[7:10] development prospects in Cula. Again, this is not about Cyper Digital. It's

[7:16] about giving the city count the city council established guidelines to be

[7:21] able to follow in the event of companies, factories, businesses coming

[7:27] into Culla. Uh, I think you're well aware that our airport is almost there.

[7:32] Where's Mr. Paige? There he is. Our airport is almost there. Almost ready

[7:38] for the big big planks. And um, this is for some of that. This is for some of

[7:43] that growth as well. Not just cyer digital. Okay. So, if you would like to

[7:49] speak on in public and and in public on this hearing, you're welcome to do so.

[7:58] Yes sir. You may approach Mr. Elio Ramirez,

[8:09] Mr. Wright, Mayor Luna, and distinguished members of the city of

[8:14] Cula Council. Uh, thank you for allowing me to address

[8:19] a few things here. Uh I want to uh start with something that

[8:26] happened in 1984 on an issue that the counselors were faced with

[8:33] and uh it was a very difficult decision uh that happened and what it was was

[8:40] that the city of Cula in its gas department was never balancing out

[8:48] and so the water department was always having to bail out the uh uh the natural

[8:54] gas department. And the city administration

[8:58] decided that they would propose an increase in the uh rate for natural gas

[9:07] and it appeared that everybody was in favor of it in the council. And my

[9:12] question was concerning the indigent population and

[9:17] the elderly. And what I said was, I have a good job and I'm guaranteed by

[9:24] the state of Texas a yearly salary increase, but the elderly who live on

[9:32] social security and the indigent population that gets money wherever they

[9:38] can, they don't have that opportunity that I have. So what's going to happen

[9:43] to them when we raise the t the rate for natural gas?

[9:48] And so all of the uh counselors were looking at an audience full of

[9:55] people that were really concerned about getting a t a hike on their their fee

[10:02] for natural gas. Everybody being a native of Cula except

[10:08] me. I moved here 47 years ago and I was a

[10:13] mayor pro Tim at the time. And so when we put it to a vote in front of all of

[10:18] the natives of Cula, the city council members who were all

[10:24] natives of Cula voted to increase the fee and I was the only descending vote.

[10:31] My my purpose for saying this is we are public servants. You all are

[10:39] public servants. That means that you serve the people and I don't need to

[10:43] tell you that because you all are very intelligent.

[10:46] So when we have a hearing like this and we have an audience

[10:51] uh for a hearing on tax abatements,

[10:57] have we taken enough time and more than one hearing

[11:02] to find out exactly where the community and the voters and the residents of the

[11:09] city of Cthula are at that particular time because those are the people that

[11:16] we serve when you are in a political seat. Okay? And like I said, I don't

[11:23] need to tell you that because y'all are intelligent people.

[11:27] So, one hearing in in in as far as I'm concerned may not be enough to be able

[11:36] to make an adequate decision. Now the the last thing that I want to say on on

[11:42] regarding that meeting was that as an outsider to Cotula, I had only been here

[11:48] for four years at that time. I saw Cutula council members

[11:56] vote against their own people.

[12:01] And so I went home and I thought that I was going to sleep well,

[12:06] but I didn't because I realized that we were not living in a community that was

[12:13] united, that understood each other, that wanted to work in the best interests of

[12:20] everyone, not just not just trying to have a

[12:26] government that was balancing out at audit time. Okay, that is important.

[12:33] Don't get me wrong. I was in an administrator in in school for quite

[12:39] quite some time and we had to face audits also. And I know that when you

[12:45] get an audit and you have an area that is not balancing out,

[12:51] people look at you with cross eyebrows. Why not? Aren't you the ones that take

[12:56] care of that? So the thing is to as in that case in 1984, what other

[13:02] alternatives are there? Instead of proposing something immediately, why

[13:07] don't we take a step back and take a look at what we presently have and who

[13:14] we serve and thank God for the blessings that we have instead of looking into the

[13:22] future and trying to strive for something and jump into the lake without

[13:26] knowing how deep the lake is or what lurks inside that water.

[13:32] But I trust because I've known practically everybody here. I think the

[13:36] the only one that I haven't known for too long is Mr. Alvarado and Mr. Wright.

[13:41] I had the pleasure of talking to him today.

[13:44] I think that you will always represent

[13:50] the people that you serve, your public servants, and I know that you will never

[13:57] forget that. Okay. Thank you very much. That's all I wanted to say. It's a it's

[14:02] an important thing as far as I'm concerned to always have knowledge of

[14:08] who you represent and what their desires and wishes are and how it's going to

[14:12] affect them. Okay. Thank you very much. Appreciate it.

[14:16] » Thank you, Mr. M.

[14:23] » So, I was so excited to get it started and get this meeting and uh hearing

[14:27] going. I I forgot to mention to you that we do have a threeminute rule. It's it's

[14:31] on the your number four there if you picked up on agenda. So, we do have a

[14:35] speaking term of three-minute rule. Of course, I'm not going to just cut

[14:39] somebody off. So, Mr. Alfa, go ahead. Come in, sir.

[14:46] Yes, sir. Mr. Mr. Sam, can you state your name for the record, please? Alam.

[14:52] Uh, mayor councilman,

[14:58] one of the things that I heard uh that's to me is sort of disappointment is that

[15:03] uh and this concerns the AI center is that decisions have been made and

[15:11] true to what Mr. Ramed said it seems like action has been done uh before

[15:17] contemplating what the community might be feeling and uh wonder what's going to

[15:22] happen. I'm fortunately I uh uh participate in

[15:29] the evergreen uh water district and the farther north

[15:34] we go by now everybody knows that uh those centers are a statewide problem.

[15:42] the water uh resources that we have are limited all over the state.

[15:48] There's a lot of questions of where this water is going to come.

[15:53] The solution that came out of uh uh making this thing reality is they call

[16:00] it waste water that comes out of the oil industry.

[16:05] Well, the question comes uh where is that water as we can we're concerned

[16:10] about this community? How much is there? And what happens if they run out of that

[16:17] and do they have the privilege of drilling their own wells into our equip

[16:22] right now? The farmers and the ranchers need water to irrigate uh the farms and

[16:28] ranches. If that water is usable uh and can be

[16:34] cleaned naturally, uh it becomes a vital resource for our communities and uh the

[16:42] people that uh produce uh the products that come out of the ranches and farms.

[16:52] I do not know what commitments this city has made so far,

[16:58] but just the attitude and what I heard at the beginning of this meeting, it

[17:03] seems that everybody, the council is already pro that they want to see this.

[17:09] Let me tell you that this is probably the most serious and dangerous situation

[17:13] that has confronted this community in all the history of

[17:26] We're facing with a very critical and dangerous uh decision making at this

[17:31] point. The reason that this uh that we have an

[17:36] audience now is because there is concern that we're making a mistake in uh

[17:43] promoting that kind of activity. It could run this community into

[17:47] oblivion. Thank you.

[18:02] » Mr. Meyer,

[18:12] Council Mayor, Mor Lunar, Mr. Right. As uh I understand it, this is the hearing

[18:20] for the abatement and then we will be heard again for item seven in a separate

[18:25] hearing because I want to talk about both.

[18:29] » I want to talk about the data center. I also want to talk about the abatement.

[18:32] » Do you think you can sign up for that? That number is good.

[18:35] » Okay. I did seven, but I didn't know they were two separate

[18:39] deals. So, can I talk about the abatement then now and talk about the

[18:43] other? This this is a public hearing for the

[18:45] consideration of guidelines and criteria for tax abatement and economic

[18:49] development. >> This is just abatement doesn't have

[18:51] anything to do with item seven. Okay, I can speak on that in the next area.

[18:55] Okay. One of the things about tax abatement as a business owner in this

[18:59] town is it affects us. We get no baitments. We pay full taxes. Have paid

[19:07] since 1988.

[19:11] There was no abatement back then. There is no abatement along the way.

[19:16] Businesses that are viable, businesses that can survive in this community and

[19:22] in any community, I don't believe should get abatements.

[19:27] They should be able to generate enough income

[19:30] so that they can pay their taxes. Because what happens if you give them

[19:34] abatements is everybody here is a taxpayer

[19:39] and we're paying the taxes for them to make money.

[19:44] Okay. I don't believe that is fair and right

[19:49] to the community that has been here for years to the ones that have supported

[19:55] the community for years. When you start giving abatements to new

[20:01] businesses to try to get them in, how long will they last?

[20:06] Will they actually be here long term? The data center is a whole another ball

[20:12] game. You give them obeyments and that will probably be the end of some

[20:18] businesses in this community. It's going to raise the tax rate to all

[20:23] the businesses. It's going to raise the cost of water,

[20:27] the cost of power. It's going to raise all the cost. And it's not all the

[20:32] research I have done in them. And I'm part of another board from the valley

[20:37] that does technology and is involved. And I've been to probably 20 AI

[20:46] um deals uh conferences about AI and what

[20:52] they do, what it does. The data center is a whole another ball game. Abatements

[20:57] are not if they can afford to come in, they shouldn't get an abatement. They

[21:01] should be able to afford to pay the taxes. Giving abatements is not a good

[21:07] thing for the city. It's not a good thing for the taxpayers cuz no matter

[21:11] what the taxpayers are paying the taxes, they're paying for everything. The

[21:17] ranchers now the citywise it's the people in the city. I live in the in the

[21:22] county, but I own business in the city and I pay

[21:26] more taxes. And I own a house in the city, but I can't run for council

[21:31] because I own a house, but I don't live there.

[21:35] So, I'm kind of stuck. I got to pay all the taxes, but I don't have any real

[21:39] say. Figure that. Okay. So, when you start

[21:45] talking about doing abatements, you need a policy, but that policy should be that

[21:50] they have to repay that down the road. That policy is if you want to give them

[21:55] a startup of a year, even maybe two years, you got to realize

[22:00] you can't raise the tax rates to everybody else to make up for the cost

[22:04] that you're going to incur for them coming into business here. I don't want

[22:08] to exceed my three minutes. But I think

[22:12] » I think you need to really think about when you're making these

[22:17] abatement policy, you have to consider where is that money

[22:22] going to be made up. Where is it going to come from? Because it's going to cost

[22:26] more to the city and the ones that are going to pay it all these taxpayers,

[22:31] all the businesses that are here. We're going to be paying it for them for two

[22:35] years for the infrastructure that it's going to take to do it and then it's

[22:41] going to be higher. So, we're going to continue to pay a higher rate even

[22:45] though they're going to have to start paying and they'll never make it up. It

[22:49] can't be made up because it's already gone and in the past. It's just going to

[22:54] make the rest of us to where eventually we won't be in business. And it will

[22:59] become a ghost town just like the oil does to town.

[23:02] It makes him a ghost town eventually. >> Thank you all for your time and for your

[23:07] consideration. Please consider that as you think about what you're doing.

[23:10] » Thank you.

[23:14] » Thank you all. Thank you all. Th this is this is still a hearing structure. Okay.

[23:19] Um I've heard that I' I've been told that that no outburst and no uh control

[23:26] that were regulated by 312. Steve, do you want to put some clarification on

[23:30] that in their time limits? I I will I will get to you, Mr.

[23:33] » I I think the only thing that wasn't said is this is a statuto requirement.

[23:37] This isn't something that the city made up. So in order to even consider having

[23:43] a policy, you have to have >> the law says one hearing. So and this

[23:50] was Jeff's not who I think may be in >> absolutely if I didn't make that clear

[23:56] and then that's what that's what clarity is.

[24:00] So le I do want to allow everybody to speak. So stay within your time limits.

[24:04] I don't want to cut anybody off. I'm part of you. Uh Andy, do you want to

[24:09] come up?

[24:16] » I appreciate y'all listening to me. I just want

[24:19] » My name is Andrew Allen, Andy Allen. I just want to say to y'all, I hope y'all

[24:25] think long and hard about this data center deal. I It's going to be right in

[24:30] my backyard. I'm going to deal with the noise, the lights, the smells,

[24:35] and I mean, literally, it's going to be in my backyard.

[24:40] My our property is right next door. I'm I'm between the little church and Lo, so

[24:46] it's going to be I'm going to have to deal with whatever mess y'all bring in

[24:50] there. I'm going to have to deal with. >> Allan, do you have something on the

[24:54] guidelines and criteria for tax abatement?

[24:58] Do you have anything on tax abatement or establishing guidelines?

[25:01] » I just I I've got things I've got to go do and I just want to get y'all to

[25:05] understand if y'all have I'd like to be notified when y'all have meetings on

[25:09] that data center cuz I want my input on it.

[25:12] » Thank you. Thank you

[25:20] » again and and I just reestablishes if anybody wants to speak it's it's to

[25:24] consider and establish guidelines and criteria governing the tax abatement for

[25:27] economic development pro prospects in Cula Texas. Do we have any other uh

[25:32] public comments?

[25:38] again. Any other public comments?

[25:47] The third one. Any other public comments? If not, I'm going to

[25:52] » head I put my name on there in general just to

[25:56] » for for hearing. Okay.

[25:59] » Thank >> go ahead, Mr.

[26:02] » Yes. >> You have to go up.

[26:11] I'm talking

[26:42] Whatever face is the right place.

[27:14] any other comment on u economic development and prospects for city of

[27:19] Cachula. Last call. Any other comment on

[27:24] establishing guidelines and criteria? If not, this hearing is a this hearing

[27:30] is adjourned.

[27:34] All right, we're going to go right into the time is

[27:38] 6:52. >> I'm sorry. I didn't ask for a motion. We

[27:45] just went to a German. Do we need a motion? We have a motion to adjurnn the

[27:49] hearing. >> Do I have a second?

[27:53] » Second. >> All in favor of a mo of uh adjourning

[27:56] this hearing say I. This part one. >> All opposed.

[28:01] This meeting, this hearing is adjourned.

[28:15] » Okay, here here we go. Before we start before we start the next meeting, if you

[28:19] are if you're going to want to do an a comment, an citizen's comment or an

[28:24] agenda comment, please sign up. I'll be picking those up momentarily.

[28:29] um and and and and then I'll put some old criteria in a little bit, but if you

[28:33] did want to sign up for public comment, please do so. Also, if some of you would

[28:37] like to move here on the side of the of the wall, we you can do so. Uh you're

[28:42] welcome to do so. I want to make everybody as comfortable as we can.

[28:53] All right.

[29:01] This is a notice of regular meeting. Thursday, August 27th, 2026,

[29:06] 6:30 p.m. Actually, it's 6:54. 6:54. This is part two of the meeting.

[29:18] Again, we're still in the same location at the Old Stockman Bank on Front

[29:22] Street. This meeting is now called to order. We'll have roll call. City

[29:26] Secretary, please.

[29:35] » Here, here,

[29:38] » here, >> here.

[29:42] Moving on to number three. That's a pledge of allegiance. Please stand.

[29:54] 198

[30:42] 14 number

[30:46] 14

[30:52] and say a prayer in the name of the Father, Holy Ghost. Father, we ask that

[30:58] you be here tonight with us. We ask that you give us the wisdom, the guidance,

[31:02] and the fortitude to run this meeting accordingly and that all our citizens

[31:06] are heard. That our questions are answered, Lord. And that we follow your

[31:10] guidance that you be in our mind, in our speech, and in our hearts. In Jesus name

[31:16] I pray.

[31:22] Now before I move into the word, I want everybody to be heard. That's the bottom

[31:27] line. I want everybody to be heard. If somebody has already answered a

[31:30] question, we'll move on to the next one. So, as many of you can can see, remember

[31:35] that this is just a citizens comment. It's not going to be an interaction with

[31:39] Cypher Digital or with a council. Council can't answer you. What we can do

[31:44] is take your information and try to do a public public hearing or a public uh uh

[31:49] workshop or or a town home a town a town hall meeting at that time. And there

[31:55] will be a town hall meeting, right? There may be two, right? However many

[32:00] you need, that's what we're going to give you. Okay? So remember, don't be

[32:04] frustrated from the council cannot answer you. You're going to get 3

[32:08] minutes. Please try to keep it short, please so that most of you can get in

[32:13] and we're going to fly around with you. I know it's a little uncomfortable here.

[32:20] So, please I do want everybody to be on and just know that they can actually

[32:27] and we will

[32:45] So, so for the minutes, please also remember to state your name when you

[32:48] come up to speak. All right. Thank you very much.

[32:52] Again, we're going to go on to uh number four. Number four is uh the citizens

[32:57] comment, and you have the three minutes, and we're going to try to address each

[33:00] and every one of you. The first one on my list is uh Miss Sandra Sidell.

[33:09] » Good evening. My name is Sandra Sidell and I am the owner of Lasell Western

[33:13] Linda Morenna Boutique and LM branch in Kachula. I stand before you tonight not

[33:18] only as a business owner but as someone who h has invested my livelihood, my

[33:25] future and my faith in this community. Born and raised in Kachula, a small town

[33:31] with small town values, rural character, and a country way of live life. Sorry,

[33:38] I'm nervous. Those same qualities

[33:43] are why many families, ranchers, retirees, and business owners choose to

[33:48] live and invest here. Today I respectfully ask the city council to

[33:54] cons oppose a proposed data center. Kachula is not a major metropolitan area

[34:01] and many of us do not want to become one. We value the peace, the open

[34:06] spaces, ranch land and close-knit community that makes this small town

[34:12] special. Largecale industries

[34:17] developments such as data centers bring significant changes that can permanently

[34:22] alter the character of a rural community. My concern is not simply

[34:28] about one project. It is about the future direction of our town. Once the

[34:34] development of this scale is approved, there is no going back.

[34:39] Future generations will live with the consequences of decisions made today.

[34:44] Many residents have questions about water usage, electrical infrastructure,

[34:49] noise, traffic, environmental impact, and the long-term effect on property

[34:54] values and ranching operations. These concerns deserve thorough answers

[35:01] before any commitments are made. I also believe our citizens should have been

[35:06] informed and invol included much earlier in this process. Transparency and public

[35:13] involvement are essential when decisions have the potential to reshape our

[35:18] community for decades. While economic development is important,

[35:24] not every project is a right fit for every community. growth should support

[35:29] the vision residents have for Cula, not replace it.

[35:35] I understand that some may see the project as an opportunity to address

[35:39] financial challenges facing our city. However, financial pressure should not

[35:44] be forced should not force us into decisions that

[35:48] could permanently change the identity of our community. We must carefully weigh

[35:53] the long-term cost against shortterm benefits. Tonight, I ask the council to

[35:59] put the interests of Kula residents first, protect our rural heritage,

[36:05] protect our natural resources, and protect the quality of life that has

[36:11] made our town worth investing. Cachula's greatest asset is not a data center. It

[36:19] is the people, the ranching heritage, and the unique way of life. Thank you

[36:25] for your time and consideration.

[36:34] Next on the agenda is uh Robert Martinez, but this is for general

[36:39] comments. Okay.

[36:45] » My name is Roberto Martinez. Uh I live here in Gula, as you all know. Uh, I've

[36:51] had some questions. Last uh couple of times I was here, I

[36:57] had a question about the city light. It got repaired today. I asked the city

[37:01] secretary to call me. I've yet to receive a call from I got a call from

[37:05] Joey. I don't consider that her. Another thing,

[37:10] um,

[37:14] you're there to work for us. Don't hide behind the glass.

[37:20] And another little right off the top, Mr. Ayella, I use social media to say

[37:26] what I say, but I did my research and I'm voicing my opinion and I'm being

[37:32] honest about it. I'm not lying to no one or nobody.

[37:37] I don't want to be lied to. I want you to not myself, but everybody that's here

[37:43] needs to be heard when we go to that office from somebody. If we ask for the

[37:49] city secretary, she needs to call. If we ask for Mr. Wright, we need to ask Mr.

[37:54] Wright needs to answer our questions when in a timely manner too, not

[38:00] 4 days from now because that's what has happened.

[38:05] I mean, that's I don't think that's a right way to run a business.

[38:09] You get paid a good salary to answer.

[38:15] That's all I have to say about that. Thank you.

[38:28] » Gilbert, are you still good? You were number three.

[38:33] » I have Mr. Anos on number seven. Are you good, sir? You want three minutes?

[38:44] I think that I already went on record and um and standing uh with a decision

[38:51] that this center should not occur and I uh explain it why but I do have a

[38:59] question on abatement if we're going to give a payment how are we going to make

[39:03] any money you know we're actually giving away all

[39:08] our opportunity to make this uh uh cost effective and also uh uh benefit from it

[39:15] if it's going to happen. A baitment is not the solution.

[39:21] I think that they perhaps uh I don't know who uh who owns that property,

[39:28] but those are the people that are going to make the money.

[39:32] We do not get anything if we don't tax that facility.

[39:46] I have Mr. Myers here back on the list.

[39:56] Mayor, Mr. Right, Councilman. In discussing the data center, I have

[40:02] numerous questions that you need to consider in this having been on the

[40:06] Winter Garden Groundwater Board for 29 years and I've had this discussion with

[40:11] Mr. Wright in his office numerous times um is the fact that we're losing 10 foot

[40:19] of water head every year.

[40:23] Okay? So that means the wells, the pump's got to go down because the

[40:28] water's going away. It's being utilized. Effluent water is a great thing, but it

[40:34] can only be used for certain stuff. Also, the oil field waste has a lot of

[40:40] uh minerals and a lot of salt and a lot of things in it that will clog up any

[40:45] cooling system they're using. These data centers use tremendous amount of water.

[40:51] You need to do your home home research on this. Don't hear what the developers

[40:56] and what the the the people that want to build the data center are saying. Please

[41:01] do your homework. What Mr. Ramirez said about we trust you to do what is right.

[41:08] We trust you to investigate what is right, too. We trust you to do your

[41:12] homework and make sure that what they're saying is true. Because I found with

[41:19] most things and most businesses in my 65 years of of life is that if you tell

[41:25] them put it in writing, put your name to it, you're willing to pay penalties. If

[41:29] not, oh no, we can't do that. We can't guarantee it. But you're telling us you

[41:34] can the water tables are going down? Okay.

[41:39] How much water is there? I don't know. We got 2,800 ft right now that most

[41:45] wells are. And maybe water's sitting at 7 800 feet depending on where you are

[41:51] throughout the whole water district, but everybody's pumps are burning up just

[41:56] like the cities. And that cost you a tremendous amount of money to lower it.

[42:00] Are they willing to help pay for some of that? You know, we we talk about

[42:05] abatements. Well, what good is that going to do when the cost to everybody

[42:09] else goes up? Okay. When this data sitter comes in, it's going to use a

[42:13] phenomenal. I would like to know exactly how many gallons or how many barrels

[42:18] they're going to use a day. And I don't want to hear it based on 78 kilowatts or

[42:24] based on this or that. I want to know what's the total use. And if you exceed

[42:29] that, what are you willing to pay? What's the penalty?

[42:33] Because it affects every one of us. Even though I don't live in the city, it

[42:36] affects me on my ranch. It affects me on my place. The other thing is the power.

[42:42] They use a phenomenal amount of power. You see all these big power lines going

[42:46] in. Part of that goes to there. Maybe not this one, but when will it come? Are

[42:51] we willing to be like San Antonio where the power goes out every day? I mean,

[42:56] that happens in San Antonio just from regular stuff. Is that what's going to

[43:00] start happening here? Do we have the funds to make sure that in the grid

[43:04] we're okay? Are they willing to guarantee that it won't affect the the

[43:09] community at all? And if it does, they're going to pay to correct it all.

[43:13] I don't think so. You won't get them to sign that contract. They should have a

[43:18] contract that their feet can be held to the fire. How many employees? Well,

[43:22] we're going to employ a whole bunch of people to build it, but it's all

[43:25] computers. You have a few maintenance guys and the security and the technology

[43:31] that it takes to do the maintenance on that stuff. Do we have the skill level

[43:35] in the community or are they all going to come from out of town and work just

[43:39] like the restaurants are having to do now, the businesses are having to do is

[43:43] bring people into town because nobody's working in town. They don't want to

[43:48] work. I don't know if y'all tried to hire people lately. But let me tell you,

[43:51] as a business owner, it ain't easy >> because they don't want to. And so, I'm

[43:57] sure I'm about out of time. I just think you need to really look at what is the

[44:03] benefit of this data center and do the research yourself as individuals. Yes,

[44:09] AI technology is going to be out there. Okay. And it's going to use up a bunch.

[44:14] I understand they're wanting to build one. Somebody want to build one fer to

[44:18] that's two in the county. But how much money? And I heard well they're going to

[44:21] just move across the road, not do the city. Well, that's another huge if the

[44:26] county goes into it, we need to be on the county because I don't see this

[44:32] being a benefit to the businesses of the community, to the to the citizens of the

[44:37] community. It's really not a benefit to our county,

[44:42] our city, any part of us. Thank you'all for your time.

[44:52] We have Jose Ar Gonzalez.

[45:06] » Uh, good afternoon, Mayor. Uh, city council. Mr. Wright had a couple

[45:11] questions and I know they can't be answered. I just wanted to pose these

[45:14] questions. Um, almost reiterating what Mr. Meyer said. I was on the phone with

[45:20] uh Mr. Derry Gardner the other day uh yesterday as a matter of fact and and he

[45:23] had a question that he wanted answered or at least proposed was the ranch land,

[45:29] the power lines, fiber, the noise, you know, what amount of devaluation in the

[45:34] land would would that cause by bringing in this uh data center? Another question

[45:40] was uh how many local construction jobs would Cipher or any other data center

[45:47] create? outside of the local jobs that you know

[45:51] would happen during construction, what permanent jobs will remain once

[45:55] construction's over because as Mr. Meyer said, there's computers and and I teach

[46:01] this stuff every day to to middle schoolers, right? There's computers that

[46:05] are taking care of the majority of the work. So, how many permanent jobs will

[46:10] Cipher or any other data center company commit to? Right. As Mr. My said, put it

[46:17] on paper. How many will they commit to? What minimum capital investment are they

[46:22] willing to make for, you know, this abatement? And then again, what's what's

[46:27] the payoff, right? Is it going to be paid back in a year? Is it going to

[46:32] never happen if, you know, they just kind of close up shop? Uh what

[46:36] commitments will be made to train and hire local residents? Workforce

[46:41] development is is crucial. Again, if you've ever gone to a restaurant, uh

[46:46] most of the people are not from here. They're from Larredo. They're from Ciso.

[46:50] So, what what uh you know, what long-term

[46:56] workforce development will be done on you know, the behalf of the company,

[47:01] whether it's Cipher or somebody else. And then again, water long-term, you

[47:05] know, effects. The water here, it's it's crazy. I

[47:10] remember being a kid and you used to be able to drink the water straight out of

[47:12] the tap and now it's a little funky, right? I know we get tests that say it's

[47:17] all good, but you know what's going to be the effect on our water? Um, not just

[47:22] drinking, but you know, as Mr. Meyer said, the water's dropping every year.

[47:27] So, what's going to be the effect on that? How what are the u

[47:33] the companies proposing to avoid some of those negative impacts? And then uh you

[47:38] know, are they willing to pay competitive wages if there are any

[47:41] permanent jobs? And uh that that's really all I had. Thank you.

[47:52] » I'm sorry if I messed up this name, but I believe it's Miss Alvarez that wanted

[47:56] to speak on number seven. Miss, did you sign up?

[47:59] » All right.

[48:03] » Good afternoon. My name is Daniela Alvarez. Um, I just moved back down here

[48:08] about two and a half years ago with my son. I want to leave a legacy, but how

[48:13] can I leave a legacy behind if there's no land behind? There's noise

[48:17] infrastructure that we're going to have to worry about with these data centers.

[48:21] My question with the data centers is with the noise pollution, how are we

[48:25] going to sustain living in near proximity with the heat access that's

[48:29] going to be pushed off around onto our our town? It's already 115 degree

[48:37] degrees degrees here. Are y'all planning to do anything with the like building a

[48:40] pipeline to move out to other cities where they don't have warm areas?

[48:44] According to my research, it's they're saying that they're trying to build

[48:48] greenhouse infrastructures. We're utilizing the heat or the condensation

[48:52] that's coming off of it. The water that's coming and producing off into

[48:55] different counties is not sustainable and live like you can't bathe in it. You

[48:59] can't feed your your cattle drink it. They can't drink it.

[49:04] There's a lot of counties that are inquiring about how are we going to have

[49:10] sustainable meat if a lot of cows are have still birthed animals and how can

[49:17] we live off of that if we don't have anything that's going to protect us from

[49:21] that. How can we move forward and leave a legacy behind for my generation and

[49:25] the generation behind us? That's all I have to say.

[49:29] » Thank you much.

[49:37] And again, I'm sorry I can't read the last name, but is that Anna?

[49:40] Oh, thank you, ma'am.

[49:45] » Yes, my name is Anna Salasar. Um, maybe a lot of you don't know me, but my

[49:50] husband is a lifelong resident of Cula, Texas. His name is Carlos Salasar Chal

[49:54] Salasar. So this um thing I just found out about it yesterday I believe and I

[50:01] thought well you know I don't think I would approve of an AI center knowing

[50:08] full well that the amount of water they take the electricity and all of that.

[50:13] We're a small community and why would we want to bring something like that here

[50:19] when we already have you know drought here? We already, you know, don't we

[50:26] really there's no benefit to the city or to the county and I own property in the

[50:32] county. I'm concerned. I have fruit trees and I'm like, okay, well, if it's

[50:37] going to take all that water, what is going to happen to me? You know, are my

[50:40] trees going to go dry just because there's a data center? And not only

[50:44] that, but then they also get an abatement. Really, these people are

[50:49] millionaires. They have tons and tons of money. They don't need abatements and we

[50:54] don't need an AI center here. And that's all I have to say. Thank you so much.

[51:05] » We have one more uh public comment uh from Miss Mary Alice Garcia. She dropped

[51:09] this off. This is a release in a conveyance of property adjacent to 605

[51:14] Gulf Street in Cula, Texas. Uh

[51:20] is that the comments you want to make it? Miss uh Mary Alice Garcia here.

[51:29] All right. With that being said, if uh there is no other comments and no sign

[51:33] up, Mr. Allen spoke already and he's already

[51:38] Yeah. >> Where's Mr. Allen?

[51:43] You you'll sign up for me afterwards. Just state your name. Come on.

[51:49] Well, everybody knows me. I'm Monica de la Cruz. Hello, mayor, city councilman.

[51:54] Um, where do I start? Um, what I know I don't know what y'all are

[52:00] going to decide and I don't know if y'all are going to really make sure that

[52:05] this is not going to affect us, but I'm pretty sure it is. I'm more than 100%

[52:09] sure that it's going to affect us in a very negative way. Okay? Not just the

[52:14] electricity, the water, the, you know, the waste water that they say that

[52:18] they're going to use. That waste water does not come a long way. You know, they

[52:22] have to filter it and clean it and then run it through the M and evaporation is

[52:26] going to be caused. So, they're going to have to end up using our water. They're

[52:30] going to have to tap into the city water and they're going to drain the the water

[52:34] table. You know, we're very low on water right now. Mr. Alvarado had already

[52:37] posted that the water table has drastically gone down. you know what

[52:42] what are y'all thinking about that bringing this the massive uh data center

[52:46] here I'm just so frustrated because you know you guys aren't thinking about the

[52:51] citizens you guys are just probably getting a big bonus and and you all are

[52:55] just you know itching for money salivating over the money and not

[52:58] thinking about what is is it going to affect us you know that that's what I'm

[53:03] just oh I'm just so frustrated about this decision that y'all are trying to

[53:07] make from under us you know you guys didn't aware make it aware y'all didn't

[53:11] put it on on the city counsel on the city uh website. We were were informed

[53:16] by Mr. Alvarado. You know, y'all didn't post it on the city. Y'all were, you

[53:20] know, we're transparent. No, y'all aren't transparent because y'all are

[53:24] keeping all this from us. You know, we live here, too. We have houses here. We

[53:29] all own houses here. I have my grandchildren. I have my kids here. And

[53:33] I'm just frustrated because you guys don't listen. You You guys don't listen.

[53:38] you know how how frustrated that is. You know, I'm just like, oh, you know, I

[53:44] don't know what it's going to do to the city if you all decide to bring it here,

[53:47] but I know it's nothing good. Nothing good can come of this. And you all know

[53:52] that. Y'all know that you guys it's it's a bailout for you guys. Okay, that's

[53:56] fine. You know, yeah, it's going to bring a lot of money, what not, but what

[54:00] good is that money if you got to put it back into the infrastructure into um you

[54:05] know, adding more power lines? you know that cost is going to land on us. You

[54:10] know I I hear it from Lidle people that have already infrastructure I mean a

[54:14] data center over there they're already dealing with all these effects you know

[54:17] that the the light bills are going up the water uh rates are going up and then

[54:22] they have to put more money into the city because you know they have to

[54:26] upgrade everything. They always have to keep upgrading.

[54:30] Everything has to be all the money that y'all are going to be getting is going

[54:33] to be going back into that into, you know, more more infrastructure, more,

[54:38] you know, more uh fixing everything to upgrade it. And it it's just it's not

[54:43] it's not going to end up well. It's not going to end up well for all of us.

[54:47] We're the ones that are going to get the hit. And how are we going to get uh how

[54:51] are we going to get that money to pay our bills if it increases? Who is going

[54:55] to help us? Are they going to have a separate account to help us if the the

[54:59] rates increase? If our bills, you know, skyrocket and uh everything goes up, how

[55:03] are we going to get protected? You know, you guys are going to benefit from it.

[55:07] Yeah. Okay, y'all are going to have the money to, you know, do other things, but

[55:11] what about us? We're the ones that are going to have to suffer being pay more

[55:15] bills, pay more water, you know, light, everything. You know, it it's going to

[55:19] hurt us on the long run. And I know you guys probably don't care, you know, and

[55:24] and I know y'all want to make this, you know, city grow and whatever, but at

[55:28] what cost? At what cost? It's going to hurt not not just, you know, the

[55:32] citizens of here in Gautula, but the ranchers like he, you know, Mr. uh, you

[55:36] know, had said that it's going to hurt them, too. Not I mean, not just us,

[55:40] everybody. Even you guys. Even you guys, you know, you y'all are going to get

[55:45] hurt on this. Why? Why? Whose idea was it to bring it here? We don't know

[55:51] anything about these things, you know. We do know that they consume a lot of

[55:54] water. They consume a lot of electricity. You know, we're going to

[55:57] get hit with all that. I mean, it's up to you guys and you all are in charge.

[56:01] You know, what can we say? We're just telling you what our dilemmas are and I

[56:05] hope you all take it into consideration. >> You're going to have a lot of pissed uh

[56:09] citizens. That's all I can say. Thank you. A lot of piss piss citizens.

[56:21] We're going to be moving on to item number five and this is to discuss and

[56:25] consider the financial report for August 2026.

[56:36] Mayor, council members, good evening. I will be brief. I don't think anybody

[56:42] wants to hear me today.

[56:47] So, your first report is your sales tax report. The city will receive tomorrow

[56:52] 161,944

[56:56] the month of August for the year for the first 11 months of the year.

[57:02] We're at 1,727,636.

[57:11] Your second report is the hotel motel tax collection report. For the month of

[57:16] July, the city received $188,438.

[57:23] So we're at $742,030 for the year.

[57:31] The third report is a summary of the statement of

[57:35] revenues and expenditures.

[57:39] So the first column the general fund had revenue has revenues through July of

[57:47] 3,366,239

[57:51] expenditures of 3,336 767 for net profit of 29,472.

[58:01] The water sewer fund has revenues of 1,941498

[58:06] expenses of 1,427 524 for net profit of 513974.

[58:16] The gas fund 31429 in revenue, $31370

[58:23] in expenses for net profit of 1,159. And the solid waste fund has revenues of

[58:31] 87,783, expenditures of 777,692

[58:38] for net profit of $30,91.

[58:43] The rest are your smaller funds. And for the month of July, the city

[58:50] issued accounts payable checks totaling $311,462.

[58:57] Are there any questions? >> Yes sir. I want to know how the hotel

[59:01] motel uh is expenditures are more than what's coming in from the hotel motel.

[59:07] » That would be uh the improvements at Plaza Flora.

[59:18] » So on the plaza we we've already received some bills on this and we

[59:23] haven't done any work. It's kind of an ongoing project. Uh

[59:28] the council for the engineer well engineering and for the the

[59:35] sorry well they they had the the community effort that they did to bring

[59:40] people in to help design the how they wanted the park and then the engineering

[59:44] is what we're paying for at this point.

[59:49] » How much is the how much is the engineering part of it? I don't have

[59:53] that answer right at the moment. I'd have to get that Dr. J.

[59:56] » Those expenses are early on in the year. >> For the month of July, we only spend

[1:00:00] like $19,000 on the hotel.

[1:00:05] » 19,000 uh for the month of July.

[1:00:13] » So, a lot of those expenses were I I believe like the final expenses on the

[1:00:19] bathroom project and those type of projects.

[1:00:32] Hotel had a very healthy fund balance to start the year.

[1:00:35] » The fund balance was 1,689,000.

[1:00:41] » So we can spend up to that amount above the revenue that we receive.

[1:00:55] Is there any other questions for Mr. Flores?

[1:01:00] » Thank you.

[1:01:11] » Next agenda item is going to be the approval of uh minutes. The first uh on

[1:01:16] 6A, you have the minutes for emergency meeting on Friday, July 24th, 2026, 3M.

[1:01:22] Is there any amendments or corrections that you can see that need to uh be

[1:01:26] addressed?

[1:01:31] If we see nothing to amend or anything else or fix, um do I have a motion to

[1:01:35] approve July 24th, 2026 emergency? Do I have a second?

[1:01:40] All in favor of approving the minutes for uh July 24th emergency meeting say

[1:01:45] I. >> All opposed.

[1:01:48] » Motion carries. The next packet on your agenda is going

[1:01:53] to be 6B and that is July 28, 2026. That was a special

[1:02:00] meeting. Do we have any corrections or amendments

[1:02:04] or questions on this one? Do I have a motion to approve the uh

[1:02:11] special meeting on July 28, 2026? >> I motion.

[1:02:15] » Do I have a second? >> All in favor of approval of the minutes

[1:02:19] for July 28, 2026 special meeting, say I.

[1:02:22] » I. >> All opposed.

[1:02:25] Motion carries. Next one in your packet is 6C

[1:02:30] and this is your July 13, 2026 regular meeting. Do you have any corrections or

[1:02:37] amendments or anything that you would want to update?

[1:02:45] » Do I have a motion to approve the August 13, 2026 regular meeting?

[1:02:51] Do I have a second? >> Second.

[1:02:53] » All in favor of approving August 13, 2026 regular meeting, say I.

[1:02:58] » All opposed? Motion carries.

[1:03:03] We're also serious. It is. It is serious. It we we really

[1:03:09] want to be there. We're going to have the next topic on

[1:03:13] your agenda is to discuss and consider a presentation by Lee uh Branchard

[1:03:19] regarding the data center cipher digital. I will mention to you right now

[1:03:24] this is the first presentation we have received. Uh none of us has seen any

[1:03:29] presentation prior to this. So this is the initial presentation. Okay.

[1:03:36] [clears throat] Mayor,

[1:03:39] I have a question. Is this on? >> Yeah.

[1:03:43] We received this this morning again, right? This one yesterday

[1:03:48] that it was in your agenda that the what was

[1:03:55] your problem? >> Cuz it should have been with agenda.

[1:04:05] Yeah, >> we need to be a little bit more specific

[1:04:07] when they when they're going to do presentations for anybody. They need to

[1:04:10] turn it in to Juanita that day to be posted by the deadline.

[1:04:20] Mayor Luna, Mr. Wright, esteemed council members. Uh my name is Lee Brancher. I'm

[1:04:25] head of policy and government affairs at Cipher Digital. Before I go, would you

[1:04:29] guys be okay if I turn sideways a little bit so I can try to address the

[1:04:33] community and the council at the same time?

[1:04:37] » Here we go. Well, I'll try to pivot a little bit

[1:04:42] back and forth here. Uh, good evening, uh, Cula community and esteemed members.

[1:04:50] » I'm joined by two of my colleagues, Bill Blevens. Uh, Bill ran uh, large load

[1:04:55] interconnections at Urkott for many years, served at Urkott, the grid

[1:04:59] operator in Texas for 20 years, and also our senior vice president of data center

[1:05:04] operations, Lee Rivers, uh, joins us tonight as well. We're here to answer

[1:05:09] questions um, and to provide some information. So, I'd like to before I

[1:05:16] get into the presentation, I'd like to address one item related to water.

[1:05:21] Thank you. Um

[1:05:25] we had initially considered using uh recycled water effluent water from the

[1:05:31] city's disposal um purple pipe if you will but um we our

[1:05:37] design has since changed. So at this point we are going planning to use a

[1:05:42] closed loop system uh that would not require any water from the city uh or uh

[1:05:50] any wells. We don't we don't use potable water um for cooling the data center. We

[1:05:56] we won't be drilling wells uh in the aquifer. We with a closed loop system.

[1:06:01] We would bring in water from um that's that's treated to purpose um for that

[1:06:08] closed loop system and we would top it off from time to time, but that would be

[1:06:12] water that we trucked in uh from elsewhere in Texas. Uh and it's a

[1:06:16] relatively small amount of water that stays in the system. Now, we would be uh

[1:06:20] using water for handwashing and toilet flushing for the employees of the data

[1:06:25] center, and that would require some water. Uh that would be potable water,

[1:06:29] but that would be less water than uh the Loves um truck stop uses currently. Um

[1:06:36] so, I don't have the exact numbers, but it would be less than a thousand gallons

[1:06:39] a day of of water use, and that would simply be um toilets and and

[1:06:45] handwashing. So before I get too deep, I wanted to uh address that item because

[1:06:50] we had considered a different cooling system previously uh and that is our

[1:06:56] current design now. Um >> I do

[1:07:00] » sir. >> Yes sir.

[1:07:01] » So you you're saying that you would not be drilling and I'm just getting it

[1:07:07] again. You know any drilling any n nothing no fresh water? know nothing

[1:07:13] here. I'm in town. Right. So, what about a waste water? I mean, is it also that

[1:07:20] you're you're going to be using? >> We we had considered that initially, but

[1:07:24] that's no longer our plan. >> Good. Okay. Yes. Because I had I had

[1:07:28] also doing a little bit of re research that AI centers,

[1:07:32] we were told that we were going to that y'all were going to be using our

[1:07:37] wastewater. council may let him do the presentation.

[1:07:41] » Let's get and and and

[1:07:46] I've also did um did did a little bit of research that um data centers don't use

[1:07:53] waste waters at all. they use fresh water and that's I I want to get things

[1:07:58] I want to get more of an understanding for me for for our PE people because uh

[1:08:04] I'm taking this very seriously for our future and um I'm just I'm just kind of

[1:08:11] curious. >> Thank you,

[1:08:13] » Councilman. So, um if we had gone with the original idea to use waste water, we

[1:08:19] would have purified it. So we had to have built a reverse osmosis water

[1:08:23] treatment facility uh to purify that water. But um uh that's not the the plan

[1:08:28] at this point. Uh and we are open as the the gentleman rancher said earlier um

[1:08:34] you know as we sit here today we have not earned y'all's trust. So me saying

[1:08:39] that is is not uh is is a small comfort. So, as the as the man as the gentleman

[1:08:44] said earlier, um we would certainly be open to uh contractual

[1:08:50] um tying our hands on that. If you want to tie our hands on water consumption

[1:08:55] and and have severe penalties, financial penalties for us not abiding that by

[1:09:01] that, we would we would certainly accept that and want to move forward with that.

[1:09:04] Um I I was on Facebook a couple nights ago. I live uh in North Texas. Um, and I

[1:09:10] was just scrolling and I noticed a few posts from members of the community

[1:09:14] encouraging uh in Cula encouraging other members of the community to come and

[1:09:17] oppose um the data center potential data center development uh here um in Cula.

[1:09:25] And um I'm glad you guys did that. I'm glad you guys are here to share your

[1:09:31] concerns. Um my colleagues and I uh have experience in many communities in West

[1:09:37] Texas of similar sizes um and and have heard very similar concerns before. And

[1:09:44] so again, while we don't have your trust today, we do plan on earning that trust

[1:09:48] over time. Um, I'm sure it wouldn't have been from

[1:09:52] anybody here in the room tonight, but I also saw a Facebook post or two that uh

[1:09:57] seemed to insinuate that there were that that the council and the mayor may have

[1:10:02] had been doing backroom deals with Cipher. This is the first time that I've

[1:10:06] met anyone on the city council. Uh, this is the first time I've communicated

[1:10:10] with. I have not ha no one at Cipher Digital has emailed with communicated or

[1:10:15] or had a phone call with any of your elected officials uh here in Cula. Um we

[1:10:22] have had a conversation with Lasal County uh in full transparency, but we

[1:10:27] have not uh this is our first engagement and presentation to uh your elected

[1:10:31] officials. So I just wanted to make sure that you know you guys y'all know that

[1:10:36] but further tell the community that um also as a general practice our company

[1:10:42] does not require NDAs. So we will not be requesting uh any members of the council

[1:10:47] the mayor or the city manager to sign a non-disclosure agreement. Um so anything

[1:10:52] that they know you guys can know. Um that is just a practice that that we do

[1:10:57] not uh undertake. Um, so Cypress objective is to build a

[1:11:02] 70 megawatt data center uh near Cula um near the Lo's truck stop off of I35

[1:11:10] uh south of town. Uh so we we want to do that in a way that's beneficial to the

[1:11:17] community and you as the community are the only ones that can determine what's

[1:11:22] beneficial to you guys um and what's not. So, uh, we understand that perhaps

[1:11:29] tax revenue or other, you know, economic development benefits, um, may not be the

[1:11:35] the most important thing for the community and and we've heard that loud

[1:11:38] and clear this evening. Um, we So, so we have other data centers throughout I'm

[1:11:44] not sure if we're able to show a slide or two. That's okay if we can't, but if

[1:11:49] you would go to the second slide, we have other data centers throughout

[1:11:53] Texas. um most of which are about more than

[1:11:58] four times the size of the data center that we're proposing here in Cula. Uh

[1:12:03] and those would be in similar communities. For example, Mitchell

[1:12:07] County, Colorado, Colorado City, Texas is up near Abalene. That that is a 300

[1:12:12] megawatt data center facility. And um the the reason why we were we're there,

[1:12:18] the reason why we're here is because of the electrical transmission lines that

[1:12:22] that run. We didn't we didn't select Cula um for any other reason other than

[1:12:28] uh there are sizable transmission lines that have a lot of extra power capacity

[1:12:33] on them and we were told by the utility and the grid operator that this was an

[1:12:38] optimal place to put a high power consuming facility. 70 megawatts is

[1:12:43] quite a bit of power. Um I I think it's also important to note though that based

[1:12:48] upon the Texas legislaturator's decision two years ago, data centers will never

[1:12:54] be on when um the community's power is off. So there has a remote breaker that

[1:13:02] they can push at any time. It's probably not a physical button, but it is a um a

[1:13:07] control that they can use in the control room at the Urkott control room to turn

[1:13:11] off a data center anytime there is a power emergency. So if Urkott gets into

[1:13:16] an emergency um they call it EA events, they will shut a data center down um and

[1:13:23] and attempt to alleviate the grid emergency um in that way. Now I I do

[1:13:30] want to caveat to say if there is a tree that falls on a power line in a certain

[1:13:33] part of town and power goes out as a result, that's not really what I'm

[1:13:38] referring to here. you know that that's something the grid

[1:13:40] operator can't control nor can cipher control but it is our commitment to you

[1:13:44] and it's also the law that we cannot be consuming power um if you guys are are

[1:13:50] don't don't have power >> sir I have another question you said

[1:13:55] shutting it down okay right okay so if it's shut down it's just going to be an

[1:14:00] abandoned building right there and just or do y'all plan to take take out

[1:14:05] everything out and leave that land clear again So, uh, when I said shut down, I

[1:14:09] meant shut down until the grid emergency passes. Usually that's when a few hours,

[1:14:15] then the data center would power back up. Yes, sir.

[1:14:18] » Yeah. If the electricity went out on the grid.

[1:14:22] » Correct. And and we could be shut down for, you know, heaven forbid another

[1:14:26] your wintertorm Yuri type situation, but if it was multiple days, um, the data

[1:14:31] center would be would be down for that amount of time. Uh I I would like to

[1:14:35] mention that my colleagues and I and again uh in a moment I'd love to take

[1:14:40] questions if that's okay with the council and the mayor. Um we can't I

[1:14:45] » I do want you to take do questions but I think the council has established

[1:14:49] questions before you and hopefully get those going and that would answer some

[1:14:53] of what our community has. >> Wonderful. Yeah, I I have colleagues

[1:14:57] here that can answer questions that are specifically from the community or the

[1:15:00] council pertaining to >> I think I only have like four pages of

[1:15:04] them. >> Just four pages. Okay, we'll be ready.

[1:15:07] Um I would also like to invite anybody from the community or the council to

[1:15:12] tour another data center site uh that we have in Texas. um they're a little bit

[1:15:18] of a drive a couple hours north of here, but those communities initially were

[1:15:23] pretty hesitant about our presence and um we're happy to say that the vast

[1:15:29] majority in the community are excited about the data center's presence and

[1:15:32] actually asking us to expand um in those communities. And again, they're four

[1:15:37] times the size of the data center proposed here um in Colorado City. It's

[1:15:41] a 300 megawatt data center. We'd love to host you there in the next couple weeks.

[1:15:45] In fact, September 14th, we're hope uh hosting an open tour. Uh we would also

[1:15:50] provide lunch to you guys who would want to come up or council members or mayor

[1:15:54] that would want to come up uh and allow you to connect with the county

[1:15:58] commissioners and the city council for uh that town uh without us present so

[1:16:04] that you can ask them what it's been like uh operating uh or or communicating

[1:16:09] with us or having us be part of their community. Um we've done that before and

[1:16:14] um again we're happy to not be present during that time. Of course we'll show

[1:16:18] you around the data center but then whenever you're having lunch with um

[1:16:22] community members and and leadership from that city and county uh we will

[1:16:26] leave so you can have a frank conversation.

[1:16:30] Uh so Cipher could build this this data center either within city limits behind

[1:16:35] the loves or uh across on the other side of I35 in the county. Uh there were some

[1:16:42] really good questions about abatements earlier. Uh we're not seeking an

[1:16:45] abatement from Lasowl County. Either way, uh if we build in the city or if we

[1:16:49] build in the county, we'll be paying full property taxes, full county taxes,

[1:16:54] full water district taxes and full Cula ISD taxes as well. So regardless of if

[1:16:59] if the data center is in the city limits or outside city limits in the county, uh

[1:17:04] the only abatement that we are requesting is actually we are interested

[1:17:09] in building inside the city to bring tremendous tax revenue to the city and I

[1:17:13] have the details and the exact numbers of our projections. Um a third party tax

[1:17:18] consultant developed for that. Um it is quite a bit more taxes if we build in

[1:17:24] the city like tens of millions of dollars more uh in taxes if we build in

[1:17:31] the city versus in the county. We are willing to pay those taxes uh but rather

[1:17:36] than pay the full amount we are requesting to pay u half of the amount.

[1:17:40] So we would pay the full taxes to the county either way we build in the city

[1:17:45] or out of the county. if we build in the city uh which would again us be us

[1:17:50] paying a considerable amount more and we do have real estate on both sides so we

[1:17:54] could build in either jurisdiction. Uh if we do build in the city, uh that is

[1:18:00] the only situation in which we discussed uh or really haven't even discussed yet,

[1:18:05] but hope to discuss a potential um uh sales tax abatement, bringing the sales

[1:18:11] tax down from 2% to 1%. Uh and and bringing the properties tax down by

[1:18:17] about 40%. We'd still even after those abatements, be the largest taxpayer

[1:18:22] um uh in Cula, Texas by by a large margin. And again, I'll have those

[1:18:27] numbers here in just a moment. Um,

[1:18:31] I would like at this point, I know the screen's a little bit small, but if we

[1:18:35] could just jump to those numbers. Um,

[1:18:42] thank you. So this is with the data center uh in these are the figures facts

[1:18:50] and figures with the data center in Cula uh in city limits with the uh partial

[1:18:57] abatements that I that I mentioned and uh over 10 years we would be paying uh

[1:19:04] 19 million to the city alone. Cula ISD stands to make much more than that um

[1:19:11] triple that amount. Uh so the so the ISD would would be a significant um receiver

[1:19:17] of of tax and again that is regardless the ISD taxing jurisdiction covers uh

[1:19:22] either of the locations that that we're looking at. Um we do plan on hiring of

[1:19:28] course uh you are correct sir the construction jobs are are certainly um

[1:19:34] more numerous than the ongoing operations jobs. So there would be

[1:19:37] several hundred construction jobs for 12 months and then when the construction is

[1:19:42] complete um there would be between 30 and 50 uh full-time employees with

[1:19:49] salaries ranging from 70,000 to 120,000 a year. Um and again you guys are

[1:19:54] welcome to to ask the residents and the the the employees at uh our Mitchell

[1:20:01] County facility if you do choose to come join us up there in a few weeks for a

[1:20:04] tour. It doesn't have to be September 14th, but we're trying to put that date

[1:20:09] out there so we can get everybody um on the same day from from um Lasowl County

[1:20:14] to to come. But so so between 30 and 50 full-time employees with that salary

[1:20:20] range is what we're anticipating as far as that concern. And and I cannot

[1:20:24] guarantee that all of those uh people will will be hired from Lasowl County.

[1:20:29] Uh we do prioritize hiring locally. It's cheaper for us because we don't have to

[1:20:34] pay relocation bonuses. So, so you have our commitment that is our priority, but

[1:20:39] it is not a guarantee that we will hire all those people locally.

[1:20:43] » Sure. >> On on that one with with jobs, you got

[1:20:46] 50 employees, right? Say we have if say we average 50 employees, say would those

[1:20:51] 50 employees and of course they would if we we wrote that into the books, half of

[1:20:55] them would be for Kajula. Is there any training and or uh that we can use that

[1:21:01] so that our our our our uh our staff would be employable in Cula?

[1:21:07] » So any training that uh Cula could do or we could do on behalf understood. Um so

[1:21:13] in Mitchell County we partner with Colorado City Texas ISD Independent

[1:21:17] School District to uh train um near graduates, juniors and seniors in their

[1:21:22] new uh CTE uh technology center. Um these these jobs are interesting.

[1:21:29] They're not uh I I call them gray collar jobs. They're not blue collar. They're

[1:21:33] not white collar. They're a bit physical and they're also a bit technical. Uh so

[1:21:38] it could be racking and stacking machines. Uh there's certainly security

[1:21:42] jobs. There's there's a lot of electric electricians that that are certainly

[1:21:46] on-site uh diesel mechanics and and people of that nature. So um it is a

[1:21:51] unique uh and varied job requirements that we do require um and we have

[1:21:57] partnered with school districts in in the past to um create training programs.

[1:22:02] So that is something that we'd certainly want to look into. So, well, with that

[1:22:05] being said, don't forget that Lasowl County is trying to work on getting

[1:22:08] Southwest Texas to come in here for this kind of particular jobs, too. So, um it

[1:22:13] might be just an avenue just because I wanted to touch on that because you

[1:22:16] mentioned it. >> And and one other thing that was

[1:22:20] mentioned in the comments from the community and and I think is a valid

[1:22:23] concern is noise. Um data center, there have been some data centers in the past

[1:22:29] that have created quite a bit of noise in the community. the places that we're

[1:22:33] planning to construct, we would be one of the uh quietest industrial operations

[1:22:38] there. Now, I will not say that the construction period will be quiet. Those

[1:22:42] 12 months, there will be increased traffic. Uh in our other communities in

[1:22:46] which we build, that is a common complaint that we get is is around

[1:22:49] traffic. So, sometimes we end up hiring, you know, if there's extra sheriff's

[1:22:53] deputies. There's not always a lot of extra sheriff's deputies. Sometimes we

[1:22:56] hire private security to conduct uh traffic management around the site

[1:23:01] because when you add a 100 vehicles to an area that's not used to that kind of

[1:23:06] traffic that that can become a problem. Uh but the noise after the data center

[1:23:11] is constructed is is quite negligible. We will be conducting sound studies

[1:23:16] before and after. Uh certainly would be at a decibel level much quieter than

[1:23:21] than the train tracks that would be near us. uh much quieter than the um gas

[1:23:26] gathering facility that that are on the other side of the highway. So, we've

[1:23:29] kind of looked at the other industrial applications that are around there and

[1:23:34] um you have our commitment that the decibel level will will be much quieter

[1:23:38] than those. The servers are loud, but they're inside several rooms. There's

[1:23:44] several walls and layers of of thick concrete in between the servers and the

[1:23:49] outside. So you cannot even hear the servers from the front door of the data

[1:23:52] center, much less the property line of the data center. The the things that

[1:23:56] could be loud would be the diesel generators for backup generation. Those

[1:24:00] are loud. Uh we don't plan to have many diesel generators at this uh site. We're

[1:24:05] not fully backing up this uh data center. So there could be some small

[1:24:09] generators to back up critical infrastructure. Uh but those would be

[1:24:13] similar to generators that you guys would have around town at other other

[1:24:16] buildings. And those would only run in the event of an emergency uh or in the

[1:24:21] event of a test for like 15 minutes uh during working hours. They might test

[1:24:26] one of those generators. Uh and again, even the generator noise would be at a

[1:24:30] decibel level much quieter than the other industrial applications around

[1:24:33] these locations. So, um happy to take more questions about noise in just a

[1:24:39] moment uh once we've tackled the questions from the city council.

[1:24:42] » That noise on uh compare that to the train you just heard. Is that an

[1:24:46] everyday occurrence? And is it going to be that loud?

[1:24:49] » Certainly not. I I don't know what the decibel level is of the train that we

[1:24:53] just heard, but um we will be taking decibel readings before and after. And

[1:24:58] it is our expectation that the data center will not contribute to noise

[1:25:02] pollution in the the surrounding area. >> Sure. Um I would like to go to a data

[1:25:07] center that's already working. I would like to hear the noise and everything.

[1:25:11] You just let me know and I'll be be there.

[1:25:14] » Okay. So the the tenative date would probably be around September 14th that

[1:25:18] we would be able to go and I believe 25 people would be able to go along with

[1:25:22] us. >> Happy to take and and 25 is just a

[1:25:26] number that I think I threw out. Um we can take more if there's more interest.

[1:25:31] » One one other thing if I could real quickly bring up you know we live in the

[1:25:35] United States of America. you know, a company that wants to come into an area,

[1:25:39] a city council or a city does not have the authority to say, "Oh, you can't

[1:25:43] come and you can't build there." They the data center if they want to build on

[1:25:47] the property, they can. The question the question of the matter is is are they

[1:25:51] going to use our water? Are we going to allow them to use our water? And are we

[1:25:55] going to give them a tax abatement? You know, if they bring their own water and

[1:25:58] there's no tax abatement, they could build. The actual property itself is

[1:26:01] already zoned industrial. It's been in zoned industrial for years. there's

[1:26:06] really not much that they would have to go through besides the permit building

[1:26:08] permit process to be able to build there. I just wanted to put that out

[1:26:12] there. Another thing as far as the decimals, you know, uh the sound, the

[1:26:16] the one thing the city can do is they could pass an ordinance for sound and

[1:26:20] then they would have to stay within that ordinance amount. Um there's going to be

[1:26:24] many contracts, at least 20 different contracts with this with this company if

[1:26:28] approved through council, you know, to make sure we have everything documented

[1:26:32] and everything in place. Um, as far as a tax payment, I don't know how if you

[1:26:38] want to go further with that one, but the the abatement, what generally

[1:26:40] happens with that is that money comes to the city. And if if the data center or

[1:26:45] company does not uh keep to the contracts that they they've been given

[1:26:49] and signed, they wouldn't get the re the rebates. So, and that would be on a

[1:26:54] yearly basis. I just wanted to put that out there.

[1:26:57] » Mr. Right, that's a a point that I'd like to a thread that I'd like to pull

[1:27:01] in a little bit further. So, if the city council uh elects not to do an

[1:27:06] abatement, that is completely within y'all's um remit and purview, uh we may

[1:27:11] still build inside the city without an abatement. It would be harder for us to

[1:27:15] convince our executive team to do that. We we may elect to build in the county

[1:27:20] because the tax burden would be much much lighter. Um but if we do build in

[1:27:25] the city limits, then we would be happy to have our hands tied related to the

[1:27:30] abatement. the the abatement could give the community members uh teeth to hold

[1:27:35] us accountable uh to doing what we say we're going to do. We're going to do

[1:27:40] what we say we're going to do whether we build in the city or the county. But if

[1:27:45] we build in the city, then there is significant financial penalties that

[1:27:48] could be levied upon us if um if we don't abide by the terms. Uh whereas the

[1:27:56] the rules around construction in the county as as many of you know you you

[1:27:59] have a lot of industry in in county land uh the decibel level in Texas and

[1:28:05] unincorporated county land is 75 dB. That's pretty loud. We are not going to

[1:28:09] be that loud but that is the only rule that we would have to abide by um if we

[1:28:15] were in the county. And so let me be clear. we are still going to be the same

[1:28:20] um transparent and and communicative

[1:28:25] professional organization regardless of where we build. Uh but if if there is an

[1:28:31] opportunity to build inside city limits, there is a mechanism for you guys to to

[1:28:35] hold our feet to to the fire with severe potential penalties uh if we don't keep

[1:28:40] those commitments. So, I'm going to proceed with uh with what we have and I

[1:28:44] I know everybody wants to get questions answered because we really haven't

[1:28:47] answered a lot of the questions, Rick. Uh some of the bigger questions, of

[1:28:50] course, you're beating the water system and uh um again, we don't we we heard

[1:28:55] about the power grid, but but I'm going to pose this question to you and my

[1:28:58] question to you is uh you're not medical and you're not sustenance. How are you

[1:29:03] going to help my community? Because if you tell me HB's attached to you or

[1:29:08] Walmart's attention to you, we're going to obey them. But you're not that. What

[1:29:13] are you going to do for my community? What are you do going to do for Couture?

[1:29:17] » It's a great question, mayor. So, um the things that we can bring uh on a

[1:29:22] positive u you know economic development generating front. Uh we're happy to

[1:29:28] frontload some of our tax payments. So, when we start con typically with a a

[1:29:32] construction project like this, um tax payments don't happen until the project

[1:29:37] is is finished. So, we're happy to happy to frontload uh some payments to the

[1:29:41] city that can be used as the city sees fit um for infrastructure for tax

[1:29:48] savings. Um it is worth noting that in all the communities in which we are

[1:29:54] operating the um the taxing entities be it cities or counties are looking at

[1:30:00] lowering their property taxes because of the tremendous property tax revenue that

[1:30:04] a data center brings. the community is having to pay less taxes. Um, in one

[1:30:09] situation, our data center 5xed or a mult by a multiple of five increased the

[1:30:15] taxable value uh for that county. I we're not bringing that much investment

[1:30:21] although we are bringing investment in in the multiple billions. Uh so we would

[1:30:25] be the largest taxpayer. I don't think we would quite 5x the value the taxable

[1:30:29] value in Las County because there's a lot of oil and gas activity here and a

[1:30:33] lot of commerce here. Uh but we would be a significant taxpayer. Um and and the

[1:30:39] secondary and tertiary economic benefits, secondary jobs and tertiary

[1:30:44] jobs um are quite significant. So while there may only be 30 full-time

[1:30:49] um employees of the data center, the secondary jobs can sometimes be two or

[1:30:55] three times that amount in the community. that's at the restaurants, at

[1:30:58] the hotels, um, all around town with with generating

[1:31:04] economic activity. >> This one's an easy question. When will

[1:31:07] be the when will the first town hall meeting be scheduled?

[1:31:11] » So, we we have reached out to a couple facilities in Cula to book a place, a

[1:31:17] venue large enough. And, um, we'd be open to doing that in the next couple

[1:31:21] weeks. Um, I think we we'd probably hope to schedule the tour of another facility

[1:31:28] first. Uh, but I can commit to you that in the month of September, we will

[1:31:32] certainly have a town hall gathering.

[1:31:39] What are the long-term um consequences to the municipality? What I mean by that

[1:31:44] is that you you're you're coming in, you're using water. You already said

[1:31:49] it's a closed circuit. At some point you're going to have to dump that. How

[1:31:52] does that work? >> It's a good question. I'm actually gonna

[1:31:55] Can I throw that question to one of my colleagues? Okay. So, Lee Rivers, our

[1:31:59] senior vice president of data center operations, deals more with the water

[1:32:02] piece. You probably don't need the mic, do you?

[1:32:06] » I don't like talking to the microphone, so I apologize if I'm nervous and do all

[1:32:09] this ahead of time. Um, the water aspect of that thing, this is a closed loop

[1:32:13] system. So, think of it as like a radiator in your car. How often are you

[1:32:16] really putting water in your radiator of your car? because it's not really

[1:32:19] evaporating with outside the system. Uh what we do is use chemicals inside the

[1:32:23] system to treat the water to make sure that we don't have any corrosion or

[1:32:26] contaminants within the piping systems themselves. And sometimes you do have a

[1:32:30] leaker here or there that we have to fill that back up. But typically once

[1:32:33] that water's in there, it's in there. And if we do have to train it and refill

[1:32:36] it, it'll be drained, taken off site and disposed of, not in the wastewater or

[1:32:41] blow down of the county. So that blow data will not be going into our source

[1:32:46] system, not into uh the river, nothing into that that none of that.

[1:32:51] » No, it would it would not

[1:32:56] » we're not planning on having to dump it because it's a closed loop system. So

[1:32:59] it's kind of just in that system permanently and then we kind of just add

[1:33:02] to it as needed and then you know keep the chemical balance there so that way

[1:33:05] we're not corroding pipes and stuff along those lines.

[1:33:07] » Okay.

[1:33:10] Well, we have leak detection within the system and we'll find that leak

[1:33:14] detection. We'll go ahead and we'll fix the leak and then top the system off if

[1:33:17] needed. Uh you actually have areas where you have the high points of the system

[1:33:21] so that way we can add it there and not have to worry about training the system

[1:33:24] or do anything like that. It does not happen very regularly. No,

[1:33:30] » I have a question. Can you explain to me the cool system? The not the cool, what

[1:33:34] is it called? >> Closed loop system. the closed I I I

[1:33:36] want to I want to visually see what you're talking about and and how all of

[1:33:39] that works. >> Uh whenever we do the town hall, I can

[1:33:42] have a presentation to kind of show exactly what a closed loop system is,

[1:33:45] but think of a closed loop system as like the radiator in your car, how it's

[1:33:48] taking the heat from the engine and it's kind of running air through it and it

[1:33:52] has coils and water going through that aspect of it and blowing across it. So

[1:33:56] that way it's cooling that. So that way it goes back into takes takes the heat

[1:33:59] from the machines and the servers comes back through like a dry cooler and air

[1:34:03] conditioned unit and kind of goes like that.

[1:34:07] » I have a question. >> Uh health healthwise does it affect or

[1:34:14] does it cause any kind of cancer with with this uh uh uh data service to

[1:34:20] the community? >> No sir. I don't know if there's any

[1:34:23] studies of anything like that actually being in the out there.

[1:34:26] » Somebody getting sick with a data service.

[1:34:29] » Yeah, I've worked in data centers for over a decade and I around and exposed

[1:34:33] to it the entire time and I never have experienced anything like that or heard

[1:34:36] of that either. >> Another question on

[1:34:41] if if you look at the whole surrounding of Cotle is a rural community and

[1:34:46] there's big ranches ranches they have bunch of animal wildlife. What's the

[1:34:51] effect on on on the wildlife? Uh >> I don't know of any negative effect on

[1:34:56] the wildlife or anything like that. Kind of like what Lee alluded to earlier. I

[1:34:59] know noise pollution is a misinformation that's out there about data centers

[1:35:03] quite a bit. I will go ahead and say like that misinformation comes from

[1:35:06] Bitcoin mining data centers to where those are not included in like you know

[1:35:10] several layers of walls that we're talking about here. Um so being inside

[1:35:14] of a data center if we're in a server hall yes it's it's quite loud. the

[1:35:17] employees in there are going to have to have hearing protection, things along

[1:35:20] those lines. But outside of the data center, you will not hear any of that

[1:35:23] noise from the machines running. Uh like Lee alluded to, the only noise that

[1:35:26] you'll hear outside the data center is when the diesel generators are running

[1:35:29] for preventive maintenance aspects or if there was a power outage and we're

[1:35:33] running generators at that point. >> That blowout and everything else when

[1:35:36] it's being transferred in or out, is it creating a mist or anything else where

[1:35:40] any of our animals or anything could be affected or any human being for that

[1:35:44] matter? >> No, ma'am. It's not uh to where it's

[1:35:46] misted or anything like that. It's a closed loop system. It's going into it.

[1:35:49] There's no evaporative cooling going on to where you're actually evaporating

[1:35:52] water into the atmosphere and it's falling back or anything like that.

[1:35:55] Another one of the

[1:35:59] » Yeah. No. Yeah. Same thing. It's it's a contained there. There'll be spill

[1:36:03] containment around that and stuff associated with that as well. Um, one of

[1:36:06] the other counties we were in, people were talking about uh, forever chemicals

[1:36:10] within the water, but that's not something that is in an evaporative

[1:36:12] cooling system that would actually be released either. Um, that's a

[1:36:16] misinformation that's out there. >> T, you mentioned that that we we could

[1:36:21] possibly go see a facility. Is that something you're really willing to

[1:36:24] charter? >> Like taking people up to go to? Yeah, we

[1:36:30] could we can schedule an arrangement to where we can have a chartered bus to,

[1:36:33] you know, y'all can meet here and then chartered up there for that day. Uh,

[1:36:36] something like that. Um, like Lee alluded to, the site that we're asking

[1:36:39] if y'all would like to come see, that's a 300 megawatt data center as well. And

[1:36:43] it's also a closed loop system, so you'd be able to see what that actually looked

[1:36:46] like in real time if you'd like to. It's not actively um online right now, but it

[1:36:51] is scheduled to come online within the next month or two.

[1:37:05] Yeah, absolutely. I mean, one of the things that we do, we try to take a

[1:37:08] noise study prior to starting construction and after construction's

[1:37:11] complete to make sure that we're not, you know, noise polluting the the

[1:37:14] county. One of the things that we do also do is uh exhaust stacks on the

[1:37:18] generator systems to reduce the amount of noise from the generators. Um, but

[1:37:22] it's not going to be anything that you It's going to be less noise than that

[1:37:25] train that just passed by. >> Um, if the community is not happy with

[1:37:30] that sound, will y'all consider u putting an extra sound wall some an

[1:37:37] extra one? >> Yeah, it it goes back to, you know,

[1:37:41] we're not going to add any noise pollution to it. I mean, it's not

[1:37:45] something that you're going to hear a noise from that data center at all. I

[1:37:49] mean, even at the the property line, I seriously doubt anybody in the community

[1:37:52] is going to hear anything. But if it is something that is, you know, a hindrance

[1:37:56] and it is something that we would look into, yes.

[1:37:58] » But what I'm saying, and I know that that he asked you for a sound burial,

[1:38:03] but if the community is not happy with the sound, will y'all consider putting

[1:38:09] another one? >> We would definitely look at that. I

[1:38:13] can't say that. that sound. >> I mean, if somebody just comes in and

[1:38:15] say like people are yelling and they want a sound barrier, that doesn't

[1:38:18] really make a lot of sense. If the data backs it up and things along those

[1:38:21] lines, then absolutely we'll look at that and we'll talk about vegetation

[1:38:24] that we could put up in natural stuff to, you know, reduce noise pollution and

[1:38:28] stuff along those lines. I think it be a huge wall around it would probably be

[1:38:31] more of an eyesore than the data center itself.

[1:38:34] » The city had an ordinance at a certain decel um they would absolutely have to

[1:38:38] follow the ordinance within city limits and they would have to mitigate the

[1:38:41] sound. So, We're going to go every every way we can to mitigate the sound as much

[1:38:46] as possible. Um, you know, going back to what I was saying, the sound from a data

[1:38:50] center, you're not going to hear any of the machine sound from outside the data

[1:38:52] center. Um, and then the generators is, you know, possibly a 15-minute run once

[1:38:57] a month per generator. And we're not talking about very many generators on

[1:39:00] this site anyways.

[1:39:06] » Gas plants nearby, right? >> Yeah, that's that's probably accurate.

[1:39:09] I've never I'm not familiar with the gas plant, but I am familiar with data

[1:39:13] centers. Yeah,

[1:39:19] » it probably probably quieter than that, I would imagine. Like I said, the the

[1:39:23] generator test runs are 15 minutes a month and you can stand outside the

[1:39:26] generator and you and I can have a conversation without yelling.

[1:39:30] Go ahead. I'm sorry. Go ahead.

[1:39:47] the the reason for any of our data center locations is related to um Urkott

[1:39:53] and the utility a um in fact Bill Bleven's worked for URKT

[1:40:00] for 20 years so I'm gonna let him answer this monkey. Well, uh, yeah, thank you,

[1:40:06] uh, for listening to us and actually bringing your concerns. First,

[1:40:11] » um, I'll say really, I'm a native Texan. My family

[1:40:18] lives in Texas. All of my family, could you speak up, please? We can't hear you

[1:40:22] better. >> Sorry. Sorry.

[1:40:24] » Yeah, I'll get louder. Um, I'm usually told to quiet down, but anyway. Um, so I

[1:40:30] take electricity and reliability as very important. Um,

[1:40:36] I've dealt with a lot of things from the power grid having operated it for 20

[1:40:41] years. Um, worked in the Navy on nuclear submarine, worked at our nuclear power

[1:40:46] plants in the state, worked at the national regulator for the electric

[1:40:51] grid. Um, and reliability is very important. So, I want to say that just

[1:40:56] right off the top. When your power is out, my family's power is out, too.

[1:41:03] So, there's no more motivation than your own family, right? So, with that, when I

[1:41:11] came to Cipher, really, I I really looked into where they were making

[1:41:15] community connections and how they were working. Um, I was very supportive of

[1:41:21] the fact how they go to the communities and actually address the problems. But

[1:41:26] the real reason that all these data centers are coming to Texas goes back 10

[1:41:30] years, even more. When we decided to build those transmission lines for all

[1:41:35] the renewables, that really lowered the prices of electricity. Um, gave us a lot

[1:41:40] of extra transmission capacity in the state and we started seeing more

[1:41:45] businesses coming. Um there was a lot of oil and gas people came to us oh maybe

[1:41:50] 15 years ago and said we're going to real drill a thousand wells for the next

[1:41:55] 20 years and guess what they have. All that was because we did these things way

[1:42:01] before and we built the infrastructure before and that's just attracting all

[1:42:06] this electricity consumption.

[1:42:15] So, actually, we've heard I I if you look at it, uh the communities that are

[1:42:21] out in out in the middle of nowhere, there's

[1:42:24] people that say, "Why don't you build them closer to town?" So, we've heard

[1:42:27] both sides. The real reason is you have electricity coming right close by and

[1:42:32] there's an easy connection to the grid because there's already electrical

[1:42:37] substations and equipment and there's the capacity because we did all these

[1:42:42] upgrades many years ago. So if the upgrades and the extra capacity wasn't

[1:42:47] there, there'd be no home. Secondly, the location is really picked more based on

[1:42:53] what the utility has close by and that kind of drives to where we would

[1:42:58] connect.

[1:43:08] » No, ma'am. Data centers don't really prevent like have uh incidences where

[1:43:11] that kind of happens. Um, for example, the site that we're inviting everybody

[1:43:15] to during construction right now, we have 3 million manh hours under active

[1:43:18] construction without any loss times or any recordable injuries. That's a huge

[1:43:22] milestone in the construction industry. And then once it gets turned over to

[1:43:25] operations, it's actually a pretty safe operation. And we have a, you know,

[1:43:28] complete safety department that is on top of that and industry standards and

[1:43:32] stuff along those lines as well

[1:43:37] to the the event. Yeah, absolutely. Would would love to host you. Yes,

[1:43:41] ma'am.

[1:43:44] two items, one on the power grid and one on the tour. Um, bear in mind the one

[1:43:49] that you going to go see is four times larger than the one we're planning to to

[1:43:53] build here. So, it will look very big. Um, just want to prepare you guys for

[1:43:58] that. This one is 70 megawatts. That one is 300 um on the power grid. So about a

[1:44:05] year and a half ago in the same piece of legislation that um and the subsequent

[1:44:10] rulemakings that the public utility commission did, it's called Senate Bill

[1:44:14] 6. So the public utility commission now requires any large load to pay 100% of

[1:44:20] their transmission uh upgrades. So if there is a transmission infrastructure,

[1:44:24] a substation or or transmission lines that need to be upgraded for us to come

[1:44:29] into a you know to to interconnect to the grid, we pay 100% of that. Prior to

[1:44:35] that legislation, a large load could come. And the reason why there's a a lot

[1:44:39] of people saying this is going to increase power prices is prior to that

[1:44:44] if a large load came that cost to add that large load would be socialized to

[1:44:49] all of the rate payers that were already there. Just like when a residential

[1:44:54] neighborhood is added to Cula, um their sub the substation buildout that they

[1:45:00] that residential neighborhood requires that y'all are all going to see that in

[1:45:05] your um a uh transmission and distribution charges

[1:45:10] go up maybe 10% or something, right? Because they're trying to cover the cost

[1:45:14] of building that substation. But for large loads like data centers, as of the

[1:45:19] last two years, we cover 100% of our interconnection costs. Really not even

[1:45:23] the last two within the last 12 months really. So in for for Las County for

[1:45:28] this facility which Cipher calls Revy. So if y'all see the name Revy, we're

[1:45:34] referring to the our proposed data center here. We've paid 100% of the

[1:45:38] transmission interconnection costs already to a

[1:46:29] It's a great question. So, we provided uh and we can provide additional details

[1:46:34] about the depreciation schedule and how much we expect the data center to be

[1:46:38] worth in any given year. But the majority of those taxes are are two

[1:46:42] ways. Property taxes on real property and personal property. And the third or

[1:46:47] the second really I guess there's three ways. real taxes on personal property,

[1:46:51] real t or property taxes on on personal property. And then the third is sales

[1:46:55] taxes. So Lasowl County doesn't have a tax rate, but Cula has a 2% sales tax

[1:47:00] rate on top of the state's uh 6.25. So um anytime we buy equipment, we pay

[1:47:08] sales taxes on it and then we also pay property taxes on the increased value.

[1:47:13] So right now the land that we've purchased probably pays about $1,000 a

[1:47:17] year in property taxes. When we build this data center, the data center alone

[1:47:21] is going to be worth over a billion dollars. The computers that go inside

[1:47:25] the data center will be worth perhaps $2 billion, total of three billion. So that

[1:47:31] is you're you're taxing that asset from a property tax perspective. You're also

[1:47:35] taxing the computers and the air cooled chillers and the the generators, switch

[1:47:42] gears, transfers. That's all being taxed also on a sales tax basis. That's why

[1:47:47] it's incredibly inexpensive for us to build in the county because we don't

[1:47:51] have to pay sales tax on any of that.

[1:47:57] » Yes, that's exactly what I was going to say.

[1:48:00] » As I understand it, it's based on where it lands.

[1:48:04] » No, where you're buying. >> Where are you buying?

[1:48:11] » So, no. No, >> you have to purchase it from here. fee

[1:48:15] where for example if if a server comes into Kula to the

[1:48:21] airport for example it's going to be tax for the city

[1:48:26] » we should clarify that but our tax consultants have told us that it's where

[1:48:29] where it lands the ending destination so like if we're buying something from

[1:48:34] Malaysia for a data center in Cula we pay sales

[1:48:38] taxes when it comes to Cula now I am not a tax expert so we will bring to the

[1:48:44] town hall, we will bring our tax consultants there and they can answer

[1:48:47] those questions. But I'm fairly sure in fact we're we are paying sales taxes in

[1:48:53] other communities. So that is if if the

[1:48:59] equipment as well. >> Let let me get uh let me get council to

[1:49:03] let me get council Steve. Do you have anything on that for permission?

[1:49:07] to what Jeff's noted uh who you will be hearing from later tonight and there are

[1:49:13] agreements where the the the additional 2% is collected here. So the six and the

[1:49:20] quarter I think you're right it does get collected where where they're getting it

[1:49:24] from but when it lands here we get the additional two.

[1:49:29] » It is yes that the the tax code allows you to do that. Uh Jeff told me

[1:49:37] uh that he actually was on the EDC in U McKenna I believe when they built

[1:49:45] the Dallas Star Complex there for the Cowboys and they had an agreement like

[1:49:50] that so that they collected those taxes in that community. And so that that is a

[1:49:56] very sophisticated agreement, but it absolutely will get done. And that's

[1:50:00] actually what Jeff has been hired to do is to lay all that out and then at some

[1:50:06] point once he comes with the proposals, we'll put it in what's called a 380

[1:50:11] agreement with uh Cyper or whoever it is that's going to be running the place. So

[1:50:18] all of those are public records. that that document gets filed with the

[1:50:22] controllers's office and they interface with the controller on all of the sales

[1:50:28] taxes and and things that sort. So, that's a good question and um but uh I

[1:50:35] guess contemplating things like this there there's ways around it. Uh I did

[1:50:40] talk to Mr. page at the EDC meeting a couple of weeks ago and he indicated

[1:50:46] that a lot of the inventory uh will come directly to the airport and

[1:50:52] it will be flown in and he indicated to me now I don't know if any of this is in

[1:50:56] writing but they're going to build warehouses out there. They're going to

[1:50:59] have the equipment there. All of that stuff gets taxed and the and and the

[1:51:03] airport is in the city limits. So all of that stuff flows through to the city.

[1:51:09] our our airport director's name is uh Mr. Paige. So the CEO of Cipher Digital,

[1:51:15] his last name is also Paige, just to clarify.

[1:51:18] » Yes. Yeah. You know, Mr. Bzer, uh I I believe one of the the the the

[1:51:24] community's more pressing needs is a hospital,

[1:51:29] you know, and obviously we're not asking Cyper Digital to build a hospital, but

[1:51:34] those are the kinds of things that the city has not had for years. I believe

[1:51:39] the closest hospital was Pierall which is about 30 miles away and and and that

[1:51:45] absolutely I think you know I don't want to speak for everybody but that's a big

[1:51:51] deal you know and we don't even have e emergency we got nothing here you know

[1:51:58] the more that can be done to bring those kinds of things in even if those are

[1:52:02] city other agreements that the city makes at some point th those are

[1:52:07] critical the health care is is almost

[1:52:10] non-existent for at least emergency healthare.

[1:52:14] » Is there a hospital district taxing entity

[1:52:18] in the area >> at at this time? There is not in 2015.

[1:52:22] It was uh it was contemplated. Uh it never went out to election. Um but the

[1:52:28] city has worked on it in the past. It just never went out to election.

[1:52:31] » There there is an we do have it. Uh where it stands honestly I don't know.

[1:52:37] There was an election that was supposed to occur

[1:52:40] at the county level that never occurred. Uh we're talking probably 10 years ago.

[1:52:45] But but you want to make people happy. So talk about house

[1:52:50] » there. There's two concepts that I could share. One is I I believe Cul is the

[1:52:54] county seat of Las County. Is that correct? Um so we'll we will not seek an

[1:52:59] abatement property tax abatement from the county. So they will get significant

[1:53:02] revenue as well. uh the and to do with as they choose as the county

[1:53:09] commissioners choose. I think Cula would probably have a pretty good argument to

[1:53:13] go to them and say, "Hey, this is uh an immediate need." The other thing, um, we

[1:53:19] certainly can't contemplate this outside of conversations with the Cula ISD

[1:53:24] school board, but if the Cula ISD is going to receive a lot of tax revenue,

[1:53:30] if they receive past a certain amount, then Robin Hood takes some of that back

[1:53:36] to Austin. You

[1:53:39] we have a board member here, so you're very familiar. So we certainly want

[1:53:44] CulaD to take as take in as much revenue as possible. Cipher Digital does not

[1:53:49] have an opinion about what happens to the overage. It's a shame that it

[1:53:53] doesn't stay in the community. There is a mechanism called a tax increment

[1:53:57] financing that if if um the school board so chose they could earmark certain

[1:54:05] amounts of revenue and this is pre uh Robin Hood money. So this does not count

[1:54:09] towards the amount that would go back to Austin. could earmark it for a

[1:54:13] reinvestment zone and do anything that the school board decides to do with it,

[1:54:18] including building medical infrastructure.

[1:54:21] Uh I have never heard of a school board building medical infrastructure with

[1:54:25] that money, but I've heard of them building water infrastructure, roads,

[1:54:30] stadiums. Um so we could get with our tax experts. Just because we've never

[1:54:34] heard of it doesn't mean it can't be done. Um, so there is a possibility that

[1:54:38] the significant revenue that would be going to the school district could a

[1:54:42] portion of that could be diverted to medical facilities.

[1:54:48] » I have a question. I have a question.

[1:54:54] I'm hearing that the city will be picking up bulk of the amount. Like for

[1:54:58] example, the people that we that you all introduced that to go C CFO to go that

[1:55:05] we were going to have to pay them to to do all of this all this stuff with uh

[1:55:10] Cipher, right? They're going to build the team. So you're telling me that the

[1:55:14] county doesn't pay any of that and the school doesn't pay any of that? I mean,

[1:55:17] so we pick up the blunt of the pay and I want to know what is the turnaround of

[1:55:22] that money coming back to us because at this point again I'm going to say it

[1:55:25] again. I do not know how healthy our budget is.

[1:55:29] » So the the uh county's deal we're going to have to bring up that here in a

[1:55:33] second also Lee to give them that part of the presentation. But um the county's

[1:55:37] deal and the city's deals are separate. Uh we may intermingle people but the

[1:55:41] county's going to pay their portion, the school's going to pay their portion, the

[1:55:44] city's going to pay their portion. But in lie of that, Cipher Digital actually

[1:55:49] and they're offering also to pay any people that we need any kind of soft

[1:55:53] fund or any kind of thing that we need to take care of the people that we need

[1:55:57] to negotiate with them. >> Um, if you want to speak on that a

[1:56:01] little bit, I mean, I could say it, but you can go ahead and say it yourself.

[1:56:04] » Sure. We're happy to cover uh legal fees or consulting fees for people that work

[1:56:09] for you guys. Uh, just because we pay for them doesn't mean that they work for

[1:56:13] us. they would be contracted um and and work for you all as the city council to

[1:56:18] negotiate on on the city council's behalf. Uh and again, I want to

[1:56:22] reiterate, we don't want to put um a tremendous

[1:56:26] amount of pressure on the community or the city council to vote on a debatement

[1:56:31] that's very contentious. Uh that puts you guys in a in a tough situation. Um I

[1:56:36] do want to also share though that um there there are mechanisms through that

[1:56:43] abatement that you guys can use to uh really force us to um

[1:56:51] um you you can create ordinances that have severe financial pen penalty

[1:56:57] should we not abide by. So, sound water consumption, things of that nature. And

[1:57:02] and um my executive team does want to pay more taxes and they do want to be in

[1:57:08] city limits. Uh if there isn't an abatement, I cannot promise that we will

[1:57:12] be in the city because the tax burden in the county is so much lighter and we

[1:57:15] already own real estate um in the county. And so, um

[1:57:20] » is that a threat? Are you saying that you're going to because we don't decide

[1:57:24] that you're going to go with the county? >> No, I I do not want it to come across

[1:57:27] that way. There is a >> I apologize.

[1:57:31] » Well, go ahead. Are you through, ma'am? I want to let you finish.

[1:57:36] » Uh, and here's my question. You know, and and I've done a little bit of

[1:57:40] research through the tax office and everything. Um, you know, I've heard

[1:57:45] that if you don't build it in the city, you going to go across the highway.

[1:57:48] Well, pack your bag. That's the way I look at it. And as far as I'm concerned,

[1:57:53] uh the property from what I'm gathering that y'all have already purchased or

[1:57:59] maybe leased. I don't think it's purchased. I think it's leased. Uh have

[1:58:03] y'all purchased property across the highway?

[1:58:06] » Believe we have leased property on the west side and um purchased property on

[1:58:12] the east side. >> Okay. So, and I want to back up a little

[1:58:15] bit. Um you you mentioned a word while ago, chillers. Are y'all bringing smart

[1:58:20] chillers in for this? And what's the dec? Yeah.

[1:58:23] » Uh, we use typically air cooled chillers, do we not?

[1:58:27] » And what is the decibel level going to be on something like that?

[1:58:32] » Every manufacturer has different decibel levels, but we can get that information

[1:58:35] to you during the town hall. >> Because you have high frequency levels

[1:58:38] and then you have low frequency levels. >> Yes, sir.

[1:58:40] » The the low frequency the high frequency everybody can hear. The train going by

[1:58:44] the high frequency. The low frequency is what you can't hear. That's it's this

[1:58:49] hum. It's a vibrant. Those low frequency levels go around objects. They don't go

[1:58:56] to that wall and stop. Absolutely. Like a sound wall. It goes around and they

[1:59:00] can travel for miles and miles. >> How do y'all stop that?

[1:59:05] » Yeah. It's one of those things that I've never seen a study to where it's to a

[1:59:10] point to where it's actually affecting anything outside of property limits and

[1:59:13] things along those lines. But this is also going back to the sound study that

[1:59:16] we'll do pre previous and afterwards as well.

[1:59:18] » Here here's the thing on that the low frequency levels they have called

[1:59:23] headaches, sleep deprivation, migraines, vertigo and anxiety and such. So so

[1:59:31] are y'all going to pay for the medical bills when these people start getting

[1:59:34] sick? >> Well, I don't know if we can, you know,

[1:59:38] take people getting sick back to the data center itself. Um, you know, I I

[1:59:42] understand where the concern is, but like for us to have a blanket statement

[1:59:46] saying we're going to provide medical coverage, we can't do that.

[1:59:50] » And then, you know, you're saying that you're you're going to bring in uh stuff

[1:59:54] to the airport. Um, is that going to be your chemicals that you're going to be

[1:59:58] flying in for this uh closed loop system?

[2:00:01] » No, I don't think the chemicals be getting flown in. They'll probably get

[2:00:04] trucked in, but we're not talking about any chemicals that you wouldn't see at

[2:00:07] any industrial complex. It's not chemicals that we're trying to hide.

[2:00:10] We'll have SDS uh sheets available and have all that pre-approved. It'll be,

[2:00:14] you know, OSHA regulated and things along those lines as well.

[2:00:17] » Are are the chemicals for the water are you talking like orthopolyphosphates and

[2:00:21] things like that? >> I'm sorry, what was the question?

[2:00:25] » So, the chemicals that you are going to be using that would be for the water

[2:00:28] treatment. So, you'd be talking about orthopolyphosphates and uh just

[2:00:31] different typically we have a chemical treatment company come in and monitor

[2:00:35] that and do all that kind of stuff. So like exactly which chemicals they're

[2:00:39] going to be using. I mean we can bring that people to us with the uh town hall

[2:00:43] as well. So that way we can have those questions answered immediately. But I

[2:00:46] mean it'll be stored properly for per OSHA regulations uh spill containment

[2:00:50] everything like that associated with it. >> So you you purchased for you're you're

[2:00:54] saying it's going to be a 70 megawatt type facility. What about expansion? Do

[2:00:59] y'all plan on trying to expand this thing as as things go along?

[2:01:06] » At this time, there is no capacity for expansion. We have no plans to expand

[2:01:12] » at this time. >> At this time,

[2:01:14] » sir, >> that's correct.

[2:01:16] » Okay, sir.

[2:01:19] » Okay. And and here here's another thing. This facility

[2:01:24] » Oh, I'm sorry. This facility is going to be a pretty huge facility for Coutula's

[2:01:30] U bill. Worst case scenario, fire breaks out. It's all electrical stuff. What

[2:01:38] type of suppression system do you have to contain that? And also, if you need

[2:01:43] outside assistance, are you willing to help with the county to get that type

[2:01:48] because I don't think we're equipped in any of the surrounding communities to

[2:01:52] handle something like that. >> Yeah, that's a great question. And um

[2:01:55] you know, we've actually partnered with Colorado City, the place where we're

[2:01:58] building a 300 megawatt site. And we have uh made donations to the local fire

[2:02:02] departments, the volunteer fire departments to have them the correct

[2:02:05] equipment to respond to these things and actually have a warehouse we're building

[2:02:08] on site to have that stuff. So that way if something were to happen and provide

[2:02:12] training for those volunteer firefighters as well to be able to come

[2:02:14] in and do it. But as far as the fire suppression system goes as well, it's

[2:02:19] all like a uh double interlock system to where it would put out the fire uh for

[2:02:23] the most part. And if we did have to, you know, bring the fire department on

[2:02:26] site, we're providing training and, you know, opportunities for them and having

[2:02:29] that hosted on our site as well as making sure the volunteer fire been, I'm

[2:02:33] assuming it's a volunteer fire department here, um, making

[2:02:36] contributions as well to make sure that your equipment is satisfactory to be

[2:02:39] able to respond. >> And they're currently in a restructuring

[2:02:42] situation, so this is a perfect opportunity to get them up to par. And

[2:02:46] and last but not least, uh you know, you you did say that every once in a while,

[2:02:51] periodically, you're going to have to fire up your generators. Uh does it have

[2:02:54] backup power for battery access? And if so, are those batteries uh if there are

[2:03:00] any, are they lithium batteries or uh how?

[2:03:03] » Yeah, typically on the server racks themselves, they're lithium ion

[2:03:07] batteries that are inside the data hall themselves. And this fire discretion

[2:03:10] system is, you know, built to handle those things. and also the uh the air

[2:03:15] circulation and things like that just for all that ozone aspect of it.

[2:03:19] » I have a question for going back on expansion uh

[2:03:26] after um if it gets done if it gets done

[2:03:32] can we make a deal that there will be no more expansion.

[2:03:37] It's one of them. um having it on black, black and white, the water will will not

[2:03:42] be touched and on power. >> Yeah, like Lee said, like as of right

[2:03:49] now, there is not any more power available. We're not actually looking

[2:03:52] for an expansion of this site. We're not anticipating an an expansion of this

[2:03:56] site. Um so probably we sign. I can't I can't I

[2:04:01] can't speak on behalf of the company and the investor right now. no expansion

[2:04:06] if this if this passes >> as of right now there is no expansions

[2:04:10] even being contemplated or >> this is this is one thing that that that

[2:04:15] were and I'm speaking for our our people as well that I mean once this gets done

[2:04:21] » right once this gets done there will no be be no more expansion

[2:04:27] » and and I went in a black and white >> right one of the things if if the

[2:04:33] council does see it see fit to create an abatement, you could put that in the

[2:04:38] abatement that the uh the site cannot expand.

[2:04:42] Um and then perhaps you could do a, you know, two-year look back and it could be

[2:04:48] a one-way street. If you guys decide to allow us to expand, you could vote to

[2:04:52] allow that. Of course, we can't come and ask for it or, you know, we would not be

[2:04:58] able to do that. Um, again, Lee and I cannot speak for the company on related

[2:05:04] to whether or not we would accept that, but I think it's highly likely given

[2:05:08] that we have no plans for expansion that we would be willing to sign that um into

[2:05:14] uh a contract. >> Okay.

[2:05:16] » And and we also feel very confident that after two or three years, the community

[2:05:21] would not mind. Perhaps you wouldn't be saying yes, yes, expand. Um, but in

[2:05:26] other communities in which we've operated, and we said this several

[2:05:29] times, you're probably hear tired of hearing us saying it. They were hesitant

[2:05:32] at first, but now they are asking for expansions. Uh, we we were on Monday,

[2:05:37] Bill and I were in Mitchell County and at the county commissioner's court,

[2:05:41] there were people at the commissioner's court who had opposed us two years prior

[2:05:45] who were there saying, "Yeah, we might as well have another data center. Um, we

[2:05:50] we liked what it's done for the hotel taxes, for uh for the small businesses

[2:05:55] in town, um, for the economic vibrancy of the town. And, um, I think Cula is

[2:06:02] more economically vibrant than um, Colorado City and Mitchell County,

[2:06:06] Texas. Um, if they were here, I'd say that. I think they might be a little

[2:06:10] offended by that, but they don't have oil and gas there. They are just east of

[2:06:14] the Peran Basin. So they look to the west and see the Peran Basin and see all

[2:06:19] the economic activity there and and have been quite frustrated that the Peran

[2:06:23] Basin did not reach them. This is something that is is really driving

[2:06:28] growth for for the town and I'll pull a direct quote from one of the county

[2:06:32] commissioners, Jeremy Strain. You'll meet him when you go up in a couple

[2:06:36] months or in a couple weeks. Uh his quote was, "This town was dying. Now

[2:06:40] it's growing." Now again, Cula is not dying. you guys have a vibrant economy

[2:06:45] here. So, it's a little bit different of a situation. Uh, but it is a similar

[2:06:48] size community about 3,500 people. Uh, I guess they're actually probably more

[2:06:53] like 4,400 and I think Cula is maybe slightly under 4,000. But it's a similar

[2:06:57] sized community um with similar industries, ranching, farming, oil and

[2:07:02] gas. Um, so there's a lot of similarities between here and and there.

[2:07:07] And that's why u we think that that would be a good one for you guys to go

[2:07:11] visit. Okay. That's true.

[2:07:25] We would welcome a third. Yeah,

[2:07:35] understood. Yeah, we we would welcome a third party analysis of that. Um all of

[2:07:40] the analysis that we've seen has shown that any heat increase is is quite

[2:07:44] negligible. Uh not even approaching 1%. Right? So it's uh cities do get hotter

[2:07:51] because there's a lot of concrete and the sun just bakes cities more than it

[2:07:55] does rural areas. So it does have add some rooftop square footage. It does it

[2:08:00] does contribute to that. Um but again, you wouldn't want to take my word

[2:08:05] for it. I think we should go get a third party study from a university in the

[2:08:09] area, but we've never seen it affect the heat um in in any of the communities

[2:08:14] that we've operated. And I'm also not familiar with any study that has shown

[2:08:19] that now.

[2:08:24] » So, >> but but but we wouldn't be contributing

[2:08:27] to that uh additional over or above. It is hot as hell in Texas. I agree. Um

[2:08:33] just praying for October to get here. Uh but our data center does not contribute

[2:08:37] to the to the he of the community. Again, don't take our word for it. We

[2:08:41] will we will um commission a study with a professor from a university of the

[2:08:46] community's choice to look into that further because we're very confident

[2:08:50] that the findings would would demonstrate there's there's no material

[2:08:53] impact. >> So am I hearing that maybe you have not

[2:08:55] done a study, you have a 300 megawatt facility already. Uh how has that

[2:09:00] impacted your your heat at at all? it it has not impacted it. Um we have two 300

[2:09:06] megawatt facilities in Texas. One of them is Wink um Texas which is out kind

[2:09:11] of on the way towards El Paso. It's on I20 to the west. Um that facility is up

[2:09:17] and running and is has not ris had any material impact.

[2:09:23] Uh >> so saying you you also mentioned that

[2:09:25] that that one was already running on our closed circuit right uh water system.

[2:09:31] the one that you're you're taking us to or or or the one that that is able to

[2:09:36] take to right to go see. My question to you is has any environmental studies

[2:09:41] been done on that area and how it affected your ecosystem

[2:09:46] » as far as our 300 megawatt facilities? >> Um we did conduct um ESA studies on

[2:09:52] those uh areas before we built uh and we will conduct subsequent studies in the

[2:09:57] coming years. Um it is ranch land and we we built on about 500 acres there which

[2:10:03] is about 10 times the amount of acreage that we would build on here. And even at

[2:10:06] 500 acres um there's cows nearby. It has not affected the deer hunting um thus

[2:10:13] far. Um so so we don't anticipate any environmental impacts of that of that

[2:10:19] nature, but we would certainly welcome third party independent studies of that

[2:10:24] to to ensure that's the case. What happens is everything falls the stars

[2:10:29] align this happens and everything else and a change comes you sell you bail out

[2:10:35] at at phase one and then what what are we left with?

[2:10:39] » It's a good question. So when we sign data center leases you can go online

[2:10:43] this is public we're a public company uh publicly traded US company. We signed

[2:10:48] 10ear leases minimum. So um we don't have any leases that are shorter than

[2:10:52] that. Some of them are 15. We even have one that's 15 years with a five-year

[2:10:56] extension, so 20-year lease. Um, so that gives a lot of certainty to the

[2:11:01] community that we're going to be there for a long time. Um, now after those 15

[2:11:06] years, um, who knows what the world looks like. We would certainly be open

[2:11:11] to um creating a mechanism in any sort of agreement that requires us to return

[2:11:16] the land to its natural um state

[2:11:21] » if we were to choose to to decommission the data center. So foundation

[2:11:26] everything back to to native Texas grassland. Um we don't anticipate that

[2:11:31] happening. There's a lot of demand for data centers. So you know should should

[2:11:34] this data center be built, we anticipate it to be used for for many years. Uh but

[2:11:40] if that is the case, we're we're open to writing that into the agreement.

[2:11:43] » And so you see uh this community's uh fear because it's fear. You know, you

[2:11:50] just mentioned it. You don't know what's going to happen in 15 years. So, as

[2:11:54] being good stewards of this land that we were given

[2:11:58] and the things that are bad in the world and the things that uh break things

[2:12:05] down, our communities, our our our woodlands, our you know, you name it,

[2:12:10] water systems and everything else. That's that's their concern. That's our

[2:12:15] concern. uh you would mitigate and and facilitate

[2:12:19] anything and everything to to make sure and ensure that our community is taken

[2:12:24] care of.

[2:12:27] » So I want the best interest for my community that that is the utmost

[2:12:32] importance. >> Understood. whether whether our cattle

[2:12:35] whether our people are being affected whether every everything and so council

[2:12:40] what I want you to know is that yes we couldn't stop them from buying the land

[2:12:45] purchasing the land leasing the land but is it it is a very important that each

[2:12:50] one of us and you said it Gilbert I got family here they live here the elderly

[2:12:55] our kids and I I participated in a what where what where's Cula in 2015 right so

[2:13:02] our kids are seeing what we're doing and taking care of and and how they want

[2:13:08] 2050 because they will be here. We will may may not but they will.

[2:13:14] So our responsibility to this community is that we take every action

[2:13:20] instead of being reactionary. But you've got the bylaws, you've got

[2:13:24] the ordinances, you've got the regulations, and those are the things

[2:13:28] that we need to pay attention to so that we're making the absolutely right

[2:13:33] decision for every single person out there. Right? So that's our biggest

[2:13:38] responsibility. Not to me, I'm on the way out. But what

[2:13:42] about our kids? What about my nieces and nephews? What about 2050? And I would

[2:13:49] love to see the picture the kids had posted for 2050. They want to to capture

[2:13:56] rainwater. They want to start their own gardens. They want to start, you know,

[2:14:01] uh have more here in the community. They want hospitals. They want an HB. They

[2:14:07] want a Walmart. We all want these things. So being good stewards to our

[2:14:12] community is of the utmost importance. and and I want the community to know

[2:14:18] there was never an opportunity to say yes or no. But what the power we have

[2:14:24] here as a a council is to make sure and ensure that our ordinances, resolutions,

[2:14:30] and everything else gets done appropriately right the first time for

[2:14:35] that. If there's a bit another company that comes besides cyber security and

[2:14:40] anybody else, this community is ready for that. I mentioned earlier that the

[2:14:45] airport is almost ready. We may get the free trade zone. We may not, but we

[2:14:52] will be ready for that next big company and the next big state uh step. It's

[2:14:58] it's just which is the right one to move forward. I'm not sure that this is it,

[2:15:03] but I know that Cula is that close to crossing over to getting the HB, to

[2:15:10] getting the Walmart, to getting the medical center. Which is the right deal?

[2:15:14] I don't know. Help me, help you. And I'm listening to you. I hear you. And we

[2:15:22] will continue to listen to you and hear you. And that's what I ask of you. That

[2:15:27] you protect my community as best you can. and and that we work together to

[2:15:32] make the right deal for this community. >> So, Madame Mayor, uh I would like to

[2:15:38] tell you that if we are a member of your community, we will protect it.

[2:15:44] » I have a question and it's going to be a followup with you're saying because we

[2:15:47] it's a trust it's a trust issue. I want to know when did you all start talking

[2:15:52] to our people and with who to started this and none of us here knew about it.

[2:15:58] When was it started? Then all of a sudden in June, I find out, we all find

[2:16:03] out. I don't know if they knew. But my question is, who did you start talking

[2:16:07] to with with them not telling us about this? Because that's the hard part for

[2:16:12] us. How can we trust y'all? Because again, I heard two years, three years

[2:16:17] that you guys have been working on this. And with who?

[2:16:21] Them >> certain

[2:16:22] » county. >> Yeah. Certainly not two years. I think

[2:16:24] our first conversation was with the County Economic Development Corporation.

[2:16:29] Um I do not know Avette's last name, but her first name is Avette. Uh and I think

[2:16:34] she represents both the city and the county. And so I had a phone call with

[2:16:37] her I believe um in Mayor June of this year. That is our first interaction with

[2:16:43] anyone from Lasal County or Cula, Texas. >> So the question is this and and I know

[2:16:49] exactly where I believe uh Councilman Janes is coming. We know that Cypher

[2:16:54] Security bought land across the highway by Coacina Ranch Road and you bought

[2:16:59] that. It was talks in 23 and I believe you bought it in 24. So we know that was

[2:17:04] there at that time. Were you already thinking about that or was that a

[2:17:09] different project? Because you guys do a lot of things.

[2:17:12] » So I'll have to get back with you an exact answer, but I I believe we

[2:17:15] purchased this project from a developer named Juvo. Is that correct? So, Juvo

[2:17:21] may have purchased land in 2024. Um, we purchased this project from them. And

[2:17:29] so, I can get you the date that we we purchased it, but we would have

[2:17:33] purchased the LLC, the controlling interest in the LLC that owned the land

[2:17:37] and the interconnection with A. Uh, I do not know the date that we purchased it.

[2:17:42] I can commit to find that for you guys. But our first conversation with anybody

[2:17:46] from Lasal County or Cula was um this at this spring at the earliest. It might

[2:17:53] have been this summer. >> And you have to understand,

[2:17:56] » so my recollection is is that at the beginning of July, we heard had our

[2:18:00] first team meeting. Um and that was the first time we actually met Cipher

[2:18:04] Digital, which I was with Evette and I was with the county judge at that time

[2:18:07] we had that meeting. uh July 10th and July 22nd my weekly council report I

[2:18:12] outlined everything that happened and what we did and what we talked about and

[2:18:16] that we um you know and all the conversation that we had and the

[2:18:19] details. So it was in it was already information was already given to the

[2:18:24] council at that point. Um the day we had that meeting, I actually told the mayor

[2:18:28] in the city secretary's office that it occurred and that you know what we

[2:18:32] talked about. >> David and some of that information,

[2:18:36] you're absolutely right, but but but the question and I don't know maybe yeah,

[2:18:41] Mark Robertson and I know I was asked about this uh from a couple of the

[2:18:46] locals was the paper said that we had a memo stating all of this and it was in

[2:18:52] the paper. So that that's why there's so many questions, you know, as to as to

[2:18:57] where it is. And and Mark was the one that posted that. I've never gotten any

[2:19:01] memo on it. Nobody did. >> Yes. Actually,

[2:19:04] » it's your interior stuff >> in your in your packet here. The

[2:19:08] correspondence is actually in your packet,

[2:19:10] » right? >> That went to each council member. The

[2:19:12] time stamp is on that. It's right here in your packet.

[2:19:16] » Good.

[2:19:20] » Mr. Wright, I want to clarify something. I know that I had mentioned to you um I

[2:19:25] had mentioned that I just received this today. What id received was I I got your

[2:19:31] packet. I just did not receive the one that you had got the uh engineering firm

[2:19:37] the goto uh firm. That's that's what I had

[2:19:41] received that particular day. I got the packet but that in addition to that

[2:19:46] packet I did not receive until that particular day.

[2:19:51] Let me uh say something. Uh I'm not against anybody, but I received it

[2:19:57] myself. And for you all's information, it has to

[2:20:01] be put out through media. So if you go to the city hall, it's it's it's put out

[2:20:07] there in the front of the city hall. Am I right?

[2:20:10] » What? >> The the agenda?

[2:20:12] » Yeah. >> It's put in the in the city hall

[2:20:16] » and it's also in the website of the city of Kulin. So everybody should have been

[2:20:20] aware regardless if we got it or didn't. You know, I got it myself. I don't know

[2:20:27] if if y'all got it >> there,

[2:20:30] » you know, but it's advertised through through social media and through

[2:20:35] the city government right in front of the city hall and it has to be posted

[2:20:42] for three business days.

[2:20:51] That's what it's about. It's it's not that's interior. That's our dirty

[2:20:56] laundry, I guess. But we just want to ensure that that absolutely we take

[2:21:02] every single step because these are decisions we're making for our kids, not

[2:21:06] you know, more than anything for our kids. And we want them to sustain a Cula

[2:21:11] where we drank from the water hose. You know, we might not do that today, but we

[2:21:16] did. We ran around barefoot. Our we had long lasting lives. And there's so many

[2:21:22] things. And this community has been act impacted tremendously by the oil field

[2:21:27] by the oil field, you know, contaminants and and our water pressures and our and

[2:21:33] and so the city I can only speak for the city of Cula is we needing to make sure

[2:21:42] that our regulations and everything and there's that trust and so we would like

[2:21:48] to have that trust but we also we have to take care of our community

[2:21:53] » completely understand and you know this is why we're here today is we're not

[2:21:56] asking for your trust we're asking for the opportunity to earn your trust

[2:21:59] through our actions over time um one of the things you know coming out here this

[2:22:03] is something that we've learned as a company of trying to engage as early on

[2:22:06] as possible with the first communications happening in June July

[2:22:09] you know it's now September and we're here doing an open forum we're going to

[2:22:12] do a town hall and another town hall and answer any of your questions we'll have

[2:22:16] people sitting around where you come up and talk to us one-on-one and answer

[2:22:19] anything that we can because we want to be an active member of the community and

[2:22:22] supporting growth in the community and answering any questions that y'all have.

[2:22:26] » I I have one more question for you, Mr. Lee. I want to talk about insurance. Uh

[2:22:32] fire rating for Las County and the city of Coula is at a two. And I'm very very

[2:22:36] curious as to your burden that you would have to pay in the county versus the

[2:22:41] city on taxes. I mean, I'm sorry, on a on insurance.

[2:22:46] So I there are places where we're in an ETJ and the city asked to annex us

[2:22:52] because there is some savings being inside city limits related to uh

[2:22:56] insurance. Um our insurance company is Marsh was the one of the largest

[2:23:01] insurance companies in the world and we have not found a material difference in

[2:23:06] what we have to pay in insurance in the city versus in the county.

[2:23:09] » Uh it's it's it is different but it's not um significant.

[2:23:13] » Yeah. could what I was what I was looking at myself personally is is

[2:23:16] availability to water for fire firefighting. You know, insurance

[2:23:20] generally would be lower for that if you were with closer to the source of water.

[2:23:25] We we do have uh as Lee mentioned a very early it's a VZDA system, very early

[2:23:30] fire detection system um that that handles the vast majority of issues

[2:23:35] related to fire. Um, if we were in the city, uh, then of course that would be a

[2:23:42] savings to us. We would certainly be willing to donate to the volunteer fire

[2:23:46] department as Lee said. Uh, if we were in the county, sometimes we do fill a

[2:23:50] water tank. Uh, but it's a one-time fill. So, we'd be transparent about the

[2:23:54] number of gallons that would go into that. It could be brackish water

[2:23:57] probably or or just, you know, firefighting water. Um that would be a

[2:24:02] onetime fill in a water tank to to use to fight fires if we were in the county.

[2:24:07] » And yeah, same comment or same thing, little different subject. You know,

[2:24:11] currently the oil fields refracking all the wells and they're they're selling

[2:24:15] the water out from under us and there's nothing we can do about it. And each one

[2:24:18] of those refracks, each well that's drilled is approximately 21 million

[2:24:22] gallons. Um very very important and nobody can do anything about it. It's

[2:24:27] happening all the way around us and nobody says anything.

[2:24:40] that they have the land and they can build regarding

[2:24:50] about it or not.

[2:24:54] » That's correct.

[2:24:58] » They're going in with a Whether you know

[2:25:04] it, whether

[2:25:12] that's

[2:25:16] » so that Yeah, you get it. Sure.

[2:25:25] » So the city the city's power and authority is to enact ordinance to keep

[2:25:29] them within regulation of what the city wants. So as we explained, you know, if

[2:25:34] the noise is too loud or something like that, we we create an ordinance and say

[2:25:38] we you guys need to mitigate it, but the ordinance would be across the board to,

[2:25:42] you know, every every business, every everybody in the community. Um if

[2:25:46] there's a pollution issue, we create an ordinance.

[2:25:51] Uh yes, ma'am. That's why we are trying to create a team currently to be of of

[2:25:55] professionals that know how to do these because myself, all of us at this table

[2:26:00] and everybody in this room do not know the implications of what's happening and

[2:26:04] we want to have experts on board to be able to tell us and

[2:26:14] Yeah. I

[2:26:18] Yes. And I I think the best thing is is that they're willing to take us to a

[2:26:22] site so we can visualize and see for ourselves.

[2:26:25] » Ma'am, no, we can do it.

[2:26:29] » Men. Men.

[2:26:40] » Right. Ma'am, that's why >> excuse me. Um, that's why I asked them

[2:26:47] that I want everything in black and white that they will not touch our

[2:26:50] water, our power and and so on. You know, there's a lot that has to be

[2:26:56] discussed. We do want to keep the com community safe and we are y'all's voice

[2:27:02] and we are going to do our best to to pro protect y'all. And I mean

[2:27:08] every every everything we we need we we needed

[2:27:14] a black and white >> everything

[2:27:17] » person >> but within the city limits we can we we

[2:27:20] have some regulation uh in the county the whole field and the with the winter

[2:27:23] garden district there's not very much regulation on them.

[2:27:41] So

[2:27:46] yes, actually actually we we have experts already that already have this

[2:27:50] information and that are going to be doing presentation tonight. Um myself,

[2:27:55] I've only I've only done exactly what everyone here has as I looked online and

[2:28:00] seen different things the same. Um there is there's no vote on this agenda to

[2:28:05] give them a tax abatement tonight. Th this is a longunning process. You know,

[2:28:09] we're not here to give a tax abatement. We're here to give a the presentation is

[2:28:14] this is what they're this is what they're offering to the city. This is

[2:28:16] what the possibility is and that's really it at this point. uh moving

[2:28:21] forward from here today, now that they've given the presentation, now the

[2:28:25] information is going to start rolling to the council, to the community, to

[2:28:28] everybody. Right now, we don't we don't have that information. We're building

[2:28:32] that team to get that information. We're Winkler or actually our longest running

[2:28:39] facility is in Odessa, Texas. Um it's probably not the best for you guys to go

[2:28:44] visit because it's right next to a power plant, multiple power plants. There's no

[2:28:47] communities nearby. Um, we show you satellite images of it. It just probably

[2:28:51] wouldn't be a good comparison because it is

[2:28:56] Mitchell County and Winkler County, Texas are are those. Mitchell County,

[2:29:00] Texas is the one we've probably mentioned a lot tonight. That's the one

[2:29:03] we'd recommend. There's also Winkler County, Texas.

[2:29:08] I believe we're at about nine months there.

[2:29:11] Oh, a little bit over a year. I it it's being retrofitted but it is um it's been

[2:29:18] up for about a year. So what I would offer is we would welcome the

[2:29:23] opportunity. I think the the thing that you know we could say hey there's no

[2:29:27] evidence that data centers cause health uh issues and that's something that

[2:29:32] would be really hard for you guys to believe coming from us. So we would be

[2:29:35] happy to pay for a panel of doctors to come to do an assessment to make a

[2:29:43] presentation to to do some some medical research. um we'd be very confident in

[2:29:48] the outcome um that there is no evidence that that even low frequency um

[2:29:55] emissions there's everything creates low frequency uh sound waves um any your car

[2:30:02] engine you know I35 everything um and so again don't take our word for it that is

[2:30:10] something that we would commit to if if it is of interest to you guys to have

[2:30:15] two or three doctors come and make a presentation to the town hall. Doctors

[2:30:19] who are not on our payroll, not on y'all's payroll, just, you know, medical

[2:30:24] professionals who have the hypocratic oath who who can do some research and

[2:30:27] and make a presentation about potential health risk because I can I can talk

[2:30:31] about how we are going to get shut off by URK if there's ever a grid emergency.

[2:30:35] That's that's factual. Um I am out of my depth trying to talk about medical

[2:30:41] things. So I I think having someone like that come in would be a good idea.

[2:30:47] So with that

[2:30:58] other

[2:31:11] » and and that's exactly what we're asking is are you responsible responsible

[2:31:15] company or are you unresponsible company? And that's that's absolutely

[2:31:19] what we need to do. We do need to start moving. I'm sorry.

[2:31:23] » So, this is a done deal. >> No, there's no done deal.

[2:31:27] » So, then that's what they're saying the contract or an agreement with them.

[2:31:32] » So, the done deal is when everybody agrees when they say, "Look, we'd rather

[2:31:37] be in the city than be in the county." that and and even with all the

[2:31:42] restrictions we give them. Remember, there's still a lot of work to be done.

[2:31:47] » So there's no rush. So there's no rush. Like the last time whatever time we take

[2:31:52] to do what we got to do is what we got to do

[2:31:54] » because I know with the beautiful big bill, you need to have this really

[2:31:57] quick. So >> Well, I want to do that.

[2:32:00] » And that's probably part of it. You know, you know, you've got to look at

[2:32:03] those federal credits. We know that. But those are things that we have to work

[2:32:07] through to be able to put them again he told you to the test

[2:32:12] » so that so that they're going to decide whether they

[2:32:17] build in the city or out outside the city. I'm not going to do it.

[2:32:29] » Yeah.

[2:32:32] Affect your water bill. >> It it it it should and it should what

[2:32:37] how how can we guarantee that it's not going to affect their water bill?

[2:32:41] » It absolutely won't affect your water bill if they're 100% if they're not

[2:32:45] connected to our system. And even if they were connected to our water system,

[2:32:49] they would charge their rate and it wouldn't affect yours.

[2:32:53] If anything, the revenues would uh actually make it so we wouldn't have to

[2:32:57] do increases.

[2:33:08] » What about her value?

[2:33:12] Because she across the street from the data.

[2:33:16] Yeah, I don't think I don't even think it would affect it. I I I don't see how.

[2:33:23] If I had the money, I probably would. >> That's not funny.

[2:33:28] » Well, >> that's not funny. Okay. Okay.

[2:33:31] » So, here here's the deal. There's a lot more questions. There's still a lot of

[2:33:34] fear. I see it. I see it in you. There is going to be a town hall meeting.

[2:33:39] Gather some more of those questions. Get yourself a group.

[2:33:43] outline those questions and let them set up the town hall meetings and and we

[2:33:49] continue to ask the questions. That's what that's what they're here for. Um

[2:33:55] » yeah, >> we have a lot of items on the agenda

[2:33:57] tonight and some more of these deal with this. Uh Jeff Snowden is on standby,

[2:34:03] right? >> And I think you're going to hear some

[2:34:05] interesting things from him. So I recommend that you stay and you listen

[2:34:09] to them when they talk about the tax abatement and the process and

[2:34:13] compression of of uh tax rates. Uh so there's there's good stuff to come. So

[2:34:20] don't lose. >> So with that being said, we do want you

[2:34:23] to stay for that. I'm going to move forward. Please continue writing down

[2:34:28] your questions. Please get ready for that town hall meeting and ask them

[2:34:33] questions. Sir, I'm going to lend you the mic and then we're going to move

[2:34:36] forward. Madame Mayor, I just want to say thank

[2:34:38] you for hosting us community. Thank you for giving us the opportunity. We will

[2:34:42] take more opportunities to provide more information. And again, I cannot stress

[2:34:46] enough. We want to hire thirdparty experts uh so that you don't have to

[2:34:50] take our word for it. Um I'm driving back to Dallas tonight, so I will

[2:34:54] probably uh head out. I've got to take my kids to school in the morning. So, I

[2:34:58] hope it's not considered rude that I depart, but I'm going to be pulling in

[2:35:02] Dallas at probably 3:00 a.m. So, uh I may I may take but I did leave my card

[2:35:09] with several individuals who are here. So, if you do need a phone number from

[2:35:12] me, um Bill and Lee also have some travel to San Antonio and Austin. So, um

[2:35:19] is it would it be okay if we we departed? I know that's probably

[2:35:23] » No. Thank you very much for your presentation.

[2:35:27] All right, we're going to go ahead and move on to uh item number eight, which

[2:35:32] is to discuss, consider, and act on approving resolution number 260827,

[2:35:37] a resolution of the city of Cula, te uh Texas electing to participate in a tax

[2:35:43] abatement agreement with uh and establishing guidelines and criteria

[2:35:47] governing tax abatement for economic development prospects in Cula. So,

[2:35:52] you're still going to see some of that same verbiage as our public uh public

[2:35:56] hearing. Do we have a presentation, please?

[2:35:57] » I do have a presentation from Mr. Jeff. Mayor, um he should be coming up right

[2:36:02] now. >> Yes. Good evening, Mayor, members of

[2:36:07] council. Can you hear me? Okay.

[2:36:10] » Yes. >> Good evening. The item before you is the

[2:36:15] consideration to adopt the guidelines. uh you've been approached to with an

[2:36:20] abatement request, but under the current statute under chapter 312, you cannot

[2:36:26] extend an abatement unless you have adopted guidelines and criteria, which

[2:36:30] I've drafted for you. Uh you you must have conducted a public hearing duly

[2:36:35] posted in the newspaper record seven days prior to that. We've done that. And

[2:36:39] so what's what's before you for consideration tonight is to adopt those

[2:36:44] guidelines. Only after you have adopted those can you then consider the

[2:36:48] abatement request lawfully. So this is a very preliminary step, a

[2:36:53] necessary step, but you're you're you're far away from giving anyone a tax

[2:36:57] abatement. All you're doing right now is giving the city a tool, the tool to

[2:37:02] consider the request and work the deal.

[2:37:13] So that's all we're doing is approving. >> We're approving the documentation to be

[2:37:18] able to even offer it back to David to anybody.

[2:37:21] » So I I looked at this documentation a little bit. I don't know if anybody else

[2:37:24] had a time to review it. Uh there's a couple of topics of uh promoting quality

[2:37:29] development promoting quality to betterment that some of this verbiage.

[2:37:33] Steve, did you did you produce this document?

[2:37:36] » I looked at it last week. Uh this is basically

[2:37:39] » I did general guidelines. Uh this has been used in other cities. I'm not

[2:37:45] trying to reinvent the wheel, but this is Jeff's uh wheelhouse. And um I I

[2:37:51] think that the meeting tonight thus far has been very productive. And I think

[2:37:56] that the people that came shed some light on some some some things that uh

[2:38:01] were possibly uh not true and also promised to give more information,

[2:38:07] including the tour of where they're at. I I I have talked to Jeff this week and

[2:38:12] uh we talked about uh his recent experience in Jacksonboro, Texas and uh

[2:38:18] I don't know if he can fill us in a little bit on some of the other deals

[2:38:22] he's made once we do this, but I think there's another agenda item he's he's

[2:38:26] involved with, right? Okay. >> So So this one is the guidance and

[2:38:32] criteria for granting tax abatement. Um, I I would like you to look at it a

[2:38:38] little further and and even maybe afford us opportunity to do a workshop or

[2:38:43] something so that we can debate this and and and then bring a a good product if

[2:38:48] we we require any changes. >> This is policy. You can always amend it.

[2:38:54] Uh this is just a placekeeper for now. And so this is these are general

[2:38:59] guidelines. I did I did read it and uh I I don't have any any issues with it.

[2:39:06] » The only thing that I have is Jeff has in his the guidelines it says um

[2:39:15] uh where is it?

[2:39:19] It's it's individual our it's it's only per per company that we

[2:39:26] can only uh you know that there is no commitment to have to do all abatements

[2:39:31] right but our resolution doesn't have that I want this resolution to mirror

[2:39:37] more or less what Jeff put on his do you understand what I'm saying

[2:39:42] » this is the this is our resolution is it not

[2:39:45] » I hear not >> okay

[2:39:48] » that This is Jeff resolution that's in our book.

[2:39:52] » So it doesn't have the mirror what he said.

[2:39:54] » What? Who said he? >> No, Jeff.

[2:39:56] » This is This is what Jeff. >> Okay.

[2:39:59] » It's right here. So I I I Jeff would like to see that abatement period not to

[2:40:04] exceed 10 years. I think that's too long. I'd like to be five. Yeah, that's

[2:40:09] by law. 10 years. We have to go 10 years, but it doesn't have to go two

[2:40:12] way. >> I don't want to make it longer. I want

[2:40:17] to make it shorter. the mayor the uh the statute limits an abatement to 10 years

[2:40:24] but you can approve an abatement agreement can't do any abatement

[2:40:28] agreement till you adopt the guidelines but once you do you could approve an

[2:40:31] abatement agreement that only extended a six-month abatement but the furthest you

[2:40:36] could go out is 10 years

[2:40:41] » one thing I did want to bring out and I think it's just a little derivative but

[2:40:46] I think it's important the Los Palmus development that

[2:40:50] everybody in here knows about the Los Palmus development in Cula.

[2:40:57] All of that was funded by a tax increment refinancing. So all of it

[2:41:03] about $20 million that was paid back to the developer

[2:41:08] by the increase in the taxable value of that property from when they started it

[2:41:14] to when they finished it. And that worked successfully. We we now all enjoy

[2:41:19] all those hotels. The millions of dollars Cula gets in. Hotel occupancy

[2:41:24] taxes would not have occurred but for the fact that that zone was created by

[2:41:30] John Ke in 2007 or eight many many years ago. So this is not something new for

[2:41:38] the city of Cula. The city has invested in economic development before. And I

[2:41:45] guess to answer the question, there are no done deals that come to the council,

[2:41:50] but David made it very clear, we live in the state of Texas. Many of you own

[2:41:55] property. You you have the right to use your

[2:41:58] property in any lawful manner that you choose to use it subject to re to

[2:42:04] government regulations. And I think that there's a misconception

[2:42:07] that somehow the city can stop these guys. We can't. There is no law against

[2:42:13] building a data center. There isn't. There aren't any. Governor Abbott has

[2:42:18] talked extensively about it. He wants to reign in some of this stuff. And like

[2:42:22] anything new, there's usually problems at first and then you learn how to deal

[2:42:26] with it and then it then it becomes a non-issue. I'm not saying that's what's

[2:42:31] going to happen here. 15 years ago when we first started

[2:42:36] developing the Eagleford Shale, hydraulic fracturing was going to ruin

[2:42:41] the world. We we were we were all going to die from earthquakes, from climate

[2:42:46] change, from all of these things. None of that has happened. And none of

[2:42:51] that is going to happen from one landowner coming in who doesn't have to

[2:42:57] come in here and tell you anything. They they came here because they wanted

[2:43:02] to come in. They understand. and they got to they've got to talk to the local

[2:43:06] people. They're they're good businessmen, but they have a right to

[2:43:09] use their property. Just like anybody here who owns a piece of land has a

[2:43:15] right to use their property. And as as far as building in the city,

[2:43:20] there are obvious reasons why you would want to do it. Police and fire, you've

[2:43:25] got municipal regulations, you got zonal, you don't have to worry about

[2:43:29] somebody putting a grilling rig behind you or something. all of those things.

[2:43:33] There's reasons they're doing it. Now, I believe he was a little koi about what

[2:43:37] he said about insurance because anybody in here who owns

[2:43:41] property in the county who's tried to insure anything out there that doesn't

[2:43:45] have fire protection, you know darn well you either don't get it or you're going

[2:43:49] to pay about 10 times what you'd pay in the city to do it.

[2:43:51] » Correct. >> So, I I think he you know I don't know

[2:43:56] about the answer I got, you know, but but Mr. Snowden known him for years to

[2:44:03] live with him. We we brought him in because he knows this stuff. He's done

[2:44:09] these all over the state of Texas that you're not going to stop these guys.

[2:44:12] You're you're not you know the best thing that you can do is to make an

[2:44:18] intelligent agreement that you can strictly monitor and that you put in

[2:44:23] place critical safeguards so that whatever problems can be avoided are

[2:44:30] avoided. and it doesn't come back. Well, why didn't you didn't think of this? Why

[2:44:34] didn't you think of that? All of these things are important. And as Jeff has

[2:44:39] said tonight, these are basic guidelines. We have to have them. For

[2:44:43] example, if you wanted to come into the city and build the racetrack, but we're

[2:44:47] not going to give you an economic incentive to do that, right? That there

[2:44:52] there are reasons why you favor some things and don't favor other things. So

[2:44:57] the city can I don't want to use that word but it can choose between what it

[2:45:02] chooses to invest its money in or not. At the end of the day when the council

[2:45:06] decides it will be yes or no. That's it. Three votes is what's required of member

[2:45:13] council to approve. And and I think

[2:45:19] I I I feel like myself that I I saw some of the faces that were in here tonight

[2:45:25] and I think that some people left probably feeling better about what they

[2:45:30] heard and again you can't 100% believe anything anybody tells you. Right.

[2:45:35] » You can't speak for that for them like that.

[2:45:38] » Right. Right. So, >> so

[2:45:42] at least they're willing to talk and they and and I think you know I'm very

[2:45:46] confident that Mr. Snow knows what he's doing otherwise he wouldn't be doing

[2:45:52] this. Thank you.

[2:45:56] » Go ahead and go ahead and

[2:46:25] We're not going to get any

[2:46:37] and that's what I keep saying here. We have to be responsible counsel and make

[2:46:41] the right decisions for for for you. That's absolutely the most important

[2:46:46] thing. Uh we we have to make all those decisions appropriately. Did could we

[2:46:52] stop them from buying the uh property? No. If Sandra wanted to sell her

[2:46:56] property, she could sell her property. That could be an IIA database. She's in

[2:47:00] the county. Okay. Why Why pick in the city and why get restricted? There's

[2:47:05] still any company. I don't care who comes in wants to get the better deal,

[2:47:10] right? So, either they go either you go in the county or they go in the city.

[2:47:16] And just remember that I want to make this right decision for you, right?

[2:47:21] Because during the oil industry and the oil boom, what did Coutula get?

[2:47:26] » What did Coutula, the city of Coutula get? What did you get? Okay, but that's

[2:47:31] the difference. Everybody got part of it. Everybody got a part of it. Only one

[2:47:36] person got sold or is leasing that land. That's who's getting it only.

[2:47:42] » So the oil, you can't compare the oil to this data center. There's no way.

[2:47:47] There's no way. There's no way. So >> we have

[2:47:50] » Yes. oil. Everybody, even the people in Cthula got it. And they and they and

[2:47:56] they and they affected our water and they affected our contaminations and

[2:48:00] they've affected they've affected a lot of things.

[2:48:18] Okay. So, we're we're going to move on to the topics at hand. We know you still

[2:48:23] have a lot of questions. We know we're we're not satisfied with what we're

[2:48:27] saying. We're we're trying to establish and afford this council. give them the

[2:48:33] right material to that so that we can make them abide by regulation and

[2:48:40] ordinance and and that's the only thing we have

[2:48:44] » and we we we have to do the right thing. Hold on a second. We have to do the

[2:48:48] right thing for you and this is part of that.

[2:48:52] » This is part of that. those ordinance and resolutions that we have to do is

[2:48:56] part of that so that we can give and have those criteria and those

[2:49:01] restrictions that you want in place.

[2:49:06] » Right. We we only have one chance to get this right. Right, Mr. Pñena? We only

[2:49:13] have this one one chance. Right. >> So, we all have to work as a team.

[2:49:18] » We all have to work as a team. You know, the console has to work with one

[2:49:22] another. We need unity so we can be strong, so we

[2:49:26] can make the the right decisions so we can help out each other, you know,

[2:49:30] because this is this is um I mean, if we don't get it right, our future, our pe

[2:49:37] people are going to pay for it. And I don't want that.

[2:49:40] » One at a time. >> Are you finished?

[2:49:42] » Yes, I'm done. >> We can be united, but we can agree to

[2:49:45] disagree. You can go for it, but I can't. And I don't have to. It's not

[2:49:49] like I'm going to stop talking to you because of that. We have the same thing.

[2:49:52] But it's not about unity. It's what I believe that is best for us. You believe

[2:49:57] what's best for us. Whatever you think, but I can't. Okay. So, that's all it is.

[2:50:03] » Discussion back and forth. And and the bottom line is it's what's best for our

[2:50:07] community.

[2:50:13] » County where once once they decide to build

[2:50:17] somewhere else, we're out completely. Yeah.

[2:50:24] » Yeah.

[2:50:27] » Right.

[2:50:33] » Okay. >> Very little regulatory.

[2:50:37] » I do have a question. You know, they made they made reference to um bringing

[2:50:42] stuff to the airport. It's still going to be designated

[2:50:46] to Cula. Yes. If they put it out in the county. So we're still even if we decide

[2:50:51] against all these abatements or this that and the other anything that lands

[2:50:55] at that airport still going to be designated as Cula. So we still get

[2:50:59] still get the monies off of that. Correct.

[2:51:01] » That's correct. The airport is within the city limits. The entire property I

[2:51:04] believe it's almost 100 acres. >> But we only get half because half of it

[2:51:07] goes to the county, right? >> No. No.

[2:51:10] » No. It's the city. Good. >> City collects entire sales tax

[2:51:14] throughout the county. If if these guys developed in the

[2:51:17] county, the county has almost nothing that they can regulate.

[2:51:35] » We can ask him to do that. >> Yes.

[2:51:41] » What's the question?

[2:51:48] testing.

[2:51:57] » So, so if there's any issues to the residents that live around the data

[2:52:00] center, is is there uh some kind of tax abatement or incentive that the city

[2:52:06] could give to them if there is some kind of uh issue with their properties?

[2:52:13] One of the things that I've incorporated in similar abatement agreements is that

[2:52:17] we do uh we require the developer to put up vegetative screening and then also

[2:52:22] not construct anything where there is a residential unit within 500 ft of the

[2:52:29] proposed construction. Um, that's how I've addressed those concerns.

[2:52:34] Historically, with respect to channeling money to a specific homeowner to make

[2:52:40] them whole due to a drop in their property value, I have not done that.

[2:52:44] And I'm going to defer to Mr. Pñena whether that would even be something you

[2:52:48] could do legally. >> I I don't believe so. But but certainly

[2:52:53] um the city if it if it has a a as I use Jeff I'm quoting him the compressed tax

[2:53:00] rates you know then then those are applied equally because there's only one

[2:53:05] municipal tax rate >> and and I I I know we're going to get to

[2:53:09] that later once we get through this >> tax abatement and all of that in the

[2:53:14] next presentation right

[2:53:18] » Jeff you will talk about the tax abatements in the next agenda item.

[2:53:22] Correct. >> I can certainly do that. Yeah. The what

[2:53:25] is before the council currently is just the adoption of the guidelines. If you

[2:53:30] were to adopt those tonight, the statute would still require for us to post

[2:53:34] another 7-day in advance public hearing for the reinvestment zone and then a

[2:53:39] 30-day posting prior to consideration of a debatement agreement. So, you guys are

[2:53:44] far far away from extending any consideration to Cipher. This is just a

[2:53:49] tool that will let you legally consider their abatement request and respond to

[2:53:53] it. That's all it is.

[2:53:59] » All right. So, we are on item eight. And if you've uh reviewed what in front of

[2:54:04] you and what presented and want to continue with this criteria of uh res uh

[2:54:09] resolution number 26-027 resolution of the city of Cachula, Texas

[2:54:15] electing to participate in a tax abatement agreement. It's not

[2:54:19] established any tax abatement yet. It's just the facil the that what facilitates

[2:54:24] that uh agreement and establishes guidelines criteria governing tax

[2:54:28] abatement for economic development prospects in Cula, Texas. Uh I call that

[2:54:34] to a vote. Do I have I'll ask you the question. Do I have a motion to

[2:54:41] vote on this item number eight?

[2:54:47] » Mayor, >> sir. Mayor, I apologize. May I amend the

[2:54:52] your motion slightly? The the resolution that I drafted does not say to

[2:54:58] participate in a tax abatement agreement. It says to participate in tax

[2:55:03] abatement agreements plural. But this isn't this is not tied to any specific

[2:55:08] request or deal. This is simply granting the city the ability to

[2:55:14] consider applications in the future >> for this or other purchases.

[2:55:19] » Yes.

[2:55:23] » Anything that wants to come. >> That's right. That's right. That's the

[2:55:26] distinction. Sorry to sorry to interrupt.

[2:55:29] » I'm like okay. So there you have it. Do I have a

[2:55:36] motion? >> Motion. Do I have a second? Okay. All in

[2:55:41] favor of discussion we've discussed and acting on and approving resolution

[2:55:45] number 2602 0827, a resolution for the city of Cula

[2:55:51] to participate in a tax abatement agreements and establishing guidelines

[2:55:56] and criteria governing tax abatements for economic development prospects in

[2:56:00] Cula, Texas. Say I. I.

[2:56:06] » All oppose say. A. >> Okay. Who said I and who said N? Raise a

[2:56:12] hand. I I three. Nay. >> With no agreement to give them a reason.

[2:56:18] » Yeah. >> Right.

[2:56:23] » Okay. >> Development like HB.

[2:56:26] » Motion carried.

[2:56:29] » I had three. >> Yes. and two against

[2:56:39] number nine. This is discuss and consider an act on approving proposals

[2:56:44] application and tax abatements and designation of reinvestment zones within

[2:56:48] the city of Cachula. What what is our zoning uh

[2:56:54] what are they zoned for currently right there?

[2:56:56] » They're known light industrial which is >> light industrial

[2:56:59] » which is what is required for what they're building.

[2:57:02] This is just a a ordinance or resolution to grant criteria on how you designate

[2:57:09] zones. We're not designating anything >> any.

[2:57:12] » No.

[2:57:15] » So Jeff have something on this one? >> Yeah. Did you want to speak on the

[2:57:19] process of tax abatements? >> Yes. Um,

[2:57:25] » so whenever an application is submitted, the first thing we have to do is

[2:57:29] designate a reinvestment zone. You can't abate on any taxable value added to land

[2:57:35] that's not in a reinvestment zone. U, in my opinion, it's premature to act on

[2:57:41] designated reinvestment zone deny. Uh, one of the things you have to do before

[2:57:45] you act on that is, uh, post uh, 7 days in advance in the paper of record and

[2:57:52] then also send certified letters to all the taxing entities that taxed on that

[2:57:57] specific land. So, we're not there yet. Uh, David, is this just information p

[2:58:02] purposes or is there action required? Um, they had it to act on it, uh, Jeff,

[2:58:08] but, uh, if you want to just go ahead and explain how it works and what you

[2:58:11] did, and if we need to, we could just go ahead and table it.

[2:58:15] » I I would take no action, but this would be an appropriate agenda item once we

[2:58:20] look at this application and uh, work through the process of the negotiations

[2:58:26] and come up with a structure that benefits the residents of the city.

[2:58:30] We're not there yet. So basically this is anformational

[2:58:36] » Yes. Yes, it is. Yes, mayor. >> So if if any of the council had concerns

[2:58:42] or anything else or wanted to see something a little different, we could

[2:58:45] still do that recommendation to you. >> Absolutely.

[2:58:50] » So we could leave it like that because it says discuss to consider an act on

[2:58:54] approving. So we need to table it. We we wouldn't take any action. It's more of

[2:58:59] anformational anything else. you can table it and then come back with uh um

[2:59:06] amendments or or things that you would like to see added or or deleted from it.

[2:59:11] This is just an application. This is not just is not for the data center. It's

[2:59:16] for everybody. This is for Walmart. This is for HB. This is for a hospital.

[2:59:21] Everything else. >> Okay. So, if if uh it's just

[2:59:27] anformational, anything questions you have for for Jeff? Did you get to look

[2:59:31] at the application? Is there something that you want to see different? I mean,

[2:59:35] I I'll tell you this. I I I I keep seeing 10 years and 10 years and 10

[2:59:40] years and I'm like, why so long? So many things can happen so quickly. What if

[2:59:46] what about five years, you know, and then they come back every five years?

[2:59:50] That's what I'd like to see, you know. I don't want to give anybody a 10ear

[2:59:54] slate. I I think five years would be plenty and that's one thing I would like

[2:59:58] to see. I'm not going to re I'm not that's one my recommendations.

[3:00:02] » I agree. But we need to change city manager to a a city administrator. He's

[3:00:06] not a manager. >> Okay, we can change it.

[3:00:09] » Not a problem. Yeah, >> this is just an application to a form

[3:00:16] » and it would just be the form they would

[3:00:20] they would use with a for it. >> And that's my that's my only thing on DJ

[3:00:25] Jeff. I I >> I don't want to give anybody with the

[3:00:29] the changing times the way they are and everything else uh five years at a time.

[3:00:34] I mean those computers and David and I talked about that are only going to last

[3:00:37] five years. What's going to happen after that? So I think that this council would

[3:00:42] love to see them come to us every five years.

[3:00:46] If if anybody not not just the data center but five years with the moving

[3:00:51] times 10 years is too long 15 no 20 worse but every five years you come back

[3:00:57] to the table and let's let's reassess. >> Understood.

[3:01:02] Okay.

[3:01:07] Anything else? Anybody have >> you want to Jeb, do you want to speak

[3:01:11] about the tax abatement anymore and guess more information?

[3:01:15] » I as as Steve Pena said, this item is just about that application which would

[3:01:21] be appended to the guidelines and that it the if we need to modify that

[3:01:27] application in the future, we can do that. Uh and typically we do modify

[3:01:32] those depending on the sector that's applying. So we've got flexibility to do

[3:01:36] that. But in my opinion, it doesn't require separate action to adopt the the

[3:01:40] application as written. We we've adopted our guidelines and we're good.

[3:01:45] » So, let's uh let's uh let's I'm going to ask for a motion to table this uh and

[3:01:49] with some amendments there. And Steve, will you look at some of that?

[3:01:53] » Yes, I I did and I have looked at it. Um I I am interested in in Mr. Snowden

[3:01:59] talking a little bit about some of the very positive things that he's seen and

[3:02:04] some of the other counties that have done it with tax rates just by way of

[3:02:09] background information and and I know I just happened to catch it Monday and uh

[3:02:17] » Right. Right. >> Yes. Is this is this the time to go

[3:02:21] through that? I'm glad to do it. We've got Cipher Digital's tax rep on

[3:02:28] the phone. Garrett, hang up. I don't want to give you all my inside scoop.

[3:02:35] » I'm still here. >> Uh I've worked with Garrett before so he

[3:02:39] understands. Um so when we when we structure a tax abatement we can

[3:02:45] incorporate a a pilot a payment le of taxes and one of the advantages of that

[3:02:50] is we can hold today's tax rate over the term of the abatement agreement that's

[3:02:56] important because due to the compression that Steve mentioned when you bring in

[3:03:00] the value that cipher put in that application which I believe David did

[3:03:06] they would they represent a tripling of your net assessed value. I think that's

[3:03:12] the number. >> Yeah, I believe it's going to be more

[3:03:15] than that. Current along with the city is about $225 million

[3:03:20] » and their their construction project alone is $480 million plus another $1.5

[3:03:24] billion in service. >> Okay. So,

[3:03:27] » and I'm Jeff, whenever whenever the time comes, I'm happy to clarify anything

[3:03:31] that's in the application. Um, and I understand that I haven't greeted the

[3:03:35] city council or or spoke yet in this meeting, but if there's anything that

[3:03:39] needs to be clarified in the application or or the numbers, I'm happy to speak to

[3:03:42] that. Thank Thank you, Garrett. Um, >> um, Jeff, could you please explain who

[3:03:48] Mr. Garrett is? >> Yes. Garrett Peters is with a firm

[3:03:52] called K Andrews, and they have been engaged by Cipher to represent them in

[3:03:57] the pursuit of this abatement. So, he's representing Cipher and I've worked with

[3:04:03] him across the table representing counties and cities across the state and

[3:04:08] I know him well. Um, on the compression that Mr. Pñena

[3:04:13] mentioned, this is super important. What the state law here in Texas says is you

[3:04:19] can only generate a certain amount of revenue and grow that by up to three

[3:04:26] currently what three and a half% a year. So if you add all this new value that

[3:04:32] this project would bring to your tax base, there's only one thing that can

[3:04:36] happen to your tax rate. It drops tremendously through what's called

[3:04:41] compression. So short-term benefit is every taxpayer

[3:04:46] would benefit from that tax rate dropping due to compression.

[3:04:51] um we have the ability with a payment lies a pilot to actually freeze that tax

[3:04:57] rate for cipher and so they would not be able to ride that down during the the

[3:05:01] term of the abatement agreement. That's a negotiation. Uh though they would

[3:05:06] certainly want to push back on that but there is ways to engineer the impact of

[3:05:10] all this value to where the benefit lands more heavily on single family

[3:05:16] residential than industrial. So that's one advantage that we want to try and

[3:05:21] pursue. We're early in the process. We we have to draft agreements and have

[3:05:25] some negotiations with the guidance of the council and of course the input of

[3:05:30] the public which is who I work for the taxpayers. But that's an advantage of

[3:05:35] tax abatement. No tax abatement. You can't put in perimeter vegetative

[3:05:42] screening. You can't put in decibel level minimums for noise. you can't uh

[3:05:47] protect or limit their ability to ch to challenge the value every year with your

[3:05:52] appraisal review board. The members of which are volunteer and don't know data

[3:05:58] centers. They'll be confronted with uh very uh highly trained professionals

[3:06:04] that will go and challenge those values every year. We'd like to remove that

[3:06:09] opportunity and and keep and define those values up front to the benefit of

[3:06:14] the city. So th those are just a few advantages of getting into an agreement

[3:06:19] as opposed to saying the city's not interested in giving you any abatement.

[3:06:23] You come, you come if you wish and then you beat up our appraisal district and

[3:06:27] you're on your own.

[3:06:37] » Anything else on it? >> Jeff, could you could you tell them what

[3:06:40] you told me about u that county? I forget which one it was. where they

[3:06:45] actually got a refund of their county taxes.

[3:06:49] » Well, we that's the Jack County. We just proposed that that on Monday but yes

[3:06:55] we've uh proposed that that developer this is a data center also that they're

[3:07:01] going to actually provide a payment two payments in lie one in of taxes and the

[3:07:07] other one will be a going to a restricted reserve account which will be

[3:07:12] used to offset single family residential ad valorum taxes through a refund every

[3:07:18] year on or around May to June. So the money will come in go to restricted

[3:07:24] reserve account by ordinance that will be defined as restricted to benefit

[3:07:29] single family residential and then on around May June of the following year if

[3:07:34] you go to the courthouse and submit your pay tax receipt you would be entitled to

[3:07:39] a refund. That's the structure that we just put forward for the commissioners

[3:07:43] to consider on Monday. And in my mind that would be the structure I would

[3:07:47] recommend y'all consider in Cula. There there's no cleaner way when a when a

[3:07:52] when a taxpayer shows up says, "What's in this for me? How do I benefit?"

[3:07:56] There's no cleaner way to respond than to say, "We we want to set this money up

[3:08:00] to where we would be in a position to refund you your tax your city taxes each

[3:08:04] year."

[3:08:09] » Just is that just city tax? Uh Jeff? >> Yes.

[3:08:16] » What was that? What was that? Was that Mr. Yella? Yeah, if it was just city

[3:08:20] tax, what we're talking about? >> Yes, sir. That's the only thing. You

[3:08:24] couldn't really you couldn't really offset the other tax

[3:08:28] entities since you don't you don't have that responsibility for the school and

[3:08:32] the county, but you could certainly position the city to refund

[3:08:38] city single family residential.

[3:08:45] Okay, good. That was justformational again.

[3:08:48] I'm going to move on and uh ask >> I'm sorry.

[3:08:52] » Yes. Right. I'm gonna ask for a motion to table this item so that we can make

[3:08:57] some adjustments and look at that. Okay. You have second.

[3:09:01] » All in favor of tableabling item number nine say I.

[3:09:04] » I. >> All opposed.

[3:09:06] Motion carries. And this is u tabled for the next

[3:09:11] meeting. Okay. Or do you want uh since September? We're

[3:09:16] going to have a meeting September 3rd. Mayor

[3:09:18] » September regular meeting. >> Regular meeting. Yes.

[3:09:22] Uh uh table to regular meeting which is the 13th.

[3:09:27] » Yeah. >> Something like it.

[3:09:40] All right. Moving on to item number 10. discuss and consider an act on escrow

[3:09:44] agreement for the city cons consultation cost between Cyper

[3:09:50] uh Revly LLC developer and the city of Cachulo. What's that about David?

[3:09:55] » Hey Jeff, do you want to speak on that one? Uh personally I think I think it

[3:09:59] should be tabled today. I don't think we're at that point. Um but if you want

[3:10:03] to speak on it and provide the council. >> Sure. This is a mechanism that the city

[3:10:08] can consider using and then Mr. Peters, I I've briefed him on this, but I'm

[3:10:12] using this form and with other counties and cities to where the you will end up

[3:10:19] incurring some costs related to the processing this application and going

[3:10:26] through all the the things that you need to. For example, before tonight, we

[3:10:30] understood you might have to design a dedicated line to transport your

[3:10:36] sewage treated effluent to uh from the plant to the uh site of

[3:10:44] the project. Well, that's an engineering cost and and uh the the mechanism of

[3:10:49] this uh form in front of you would be for Cipher

[3:10:54] to put put up the money in in advance and that way you would have liquidity to

[3:10:59] pay for the fees that you would incur as part of this process of reviewing their

[3:11:04] application and negotiating with them. Is that what that $75,000 would be agre?

[3:11:11] » Yeah, that that's part of my issue is the $75,000 because I'm aware after

[3:11:15] today that Cipher would be willing to put up about $250,000 towards escrow for

[3:11:20] anything that the city needs as far as uh experts or the doctor or people from

[3:11:25] the university to come and do the studies. So, I I wouldn't want to

[3:11:29] approve this tonight until we uh we corrected that number.

[3:11:35] And also I I do have something uh here and Steve can you uh check the validity

[3:11:40] of this as well and and that this one has David signing and why wouldn't I be

[3:11:46] signing as mayor and executive officer of the city of Cachula

[3:11:50] » t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t t

[3:11:51] typically the council designates to sign it. It could be you if you want.

[3:11:56] » Okay, >> you just have to put it on the document.

[3:12:01] » So I think this answered and correct me if I'm wrong. what Miss Yiannis was

[3:12:06] saying earlier about these upfront costs. What this does is they they

[3:12:11] basically fund that. So your experts, your people you're bringing in, that's

[3:12:16] not coming out of your general fund. Now, how they collect that, I don't

[3:12:20] know. It's it's just part of of that agreement. They're not giving it to you

[3:12:24] for free. They'll they'll get it back somewhere probably.

[3:12:28] » And I know we're not approving it. It's moreformational, but when David it comes

[3:12:31] back, I would like to see that. I'm on that. I think if there's other experts

[3:12:35] you want to bring in. If there's other people that you feel are necessary for

[3:12:40] the deal, then the city doesn't have to front the

[3:12:44] money. You're going to have this account where it can be drawn on. And that and

[3:12:49] and again I keep saying I do talk to Jeff a lot but he has told me what he

[3:12:54] does in other counties and that was actually he said it at the last meeting

[3:12:58] but I know all this stuff there's a lot to to digest and remember

[3:13:03] » which is absolutely the reason for a team effort because nobody can do this

[3:13:08] constantly and still run the city. No no way.

[3:13:13] » All right. Uh so we're going to I'm going to ask for a motion to table this

[3:13:17] item. David, when do we need to bring it back?

[3:13:19] » Um, I think we I need to have a conversation with Mr. Snowden and I'm

[3:13:24] not too sure if uh the next meeting maybe we should go a little past the

[3:13:27] next meeting. >> Okay. So, we're going to

[3:13:30] » I I think that that there's going to be several meetings coming up that are

[3:13:34] going to be very important for the council to create a forum. There's going

[3:13:37] to be several special meetings and and things like that coming up probably

[3:13:41] every two weeks. This is a busy time of year with a budget, with this. We we

[3:13:46] absolutely need need you guys to to to to do all this work. Okay. So, uh I'm

[3:13:51] going to ask for a motion to uh table this item in into September, probably

[3:13:57] the last uh the last meeting of September if we can get in uh if if need

[3:14:02] be uh early October. Okay. >> The first motion.

[3:14:05] » Do I have a second?

[3:14:09] » The second. Good. I got a second. All in favor of tableabling this item to late

[3:14:14] September, early October, say I. >> I.

[3:14:16] » All opposed. Thank you. Motion carries.

[3:14:27] Number 11, discuss and consider and act on resolution number 26827A,

[3:14:34] a resolution amending designation authorized representative of city of

[3:14:38] Cula to a text pool account. Uh I I have a little something on this and I know

[3:14:43] Mr. Flores is the one that presented this, right?

[3:14:46] » Yeah. >> Okay. Mr. Flores, you you presented this

[3:14:50] as a resolution amending authorized representative. Tell us what it's about,

[3:14:55] » mayor. Um the city of Cula currently has a text

[3:15:00] pool account. Text poolool is an investment pool associated with the

[3:15:05] state of Texas that go Texas governmental entities send their money

[3:15:10] to text pool for investment. We currently use pool cash. We have one

[3:15:17] bank account that takes care of everything.

[3:15:20] We want to start segregating the funds. So primarily our first step would be to

[3:15:27] create an EDC account. a general fund. The general fund account already exists

[3:15:33] and we've had it for years, but it's been dormant. Actually, I believe the

[3:15:38] authorized representative is still Larry Do Alina. So, this is

[3:15:44] just to um change the the names of uh the people that can uh transact business

[3:15:52] with text pool. We actually have a space for one more name if the council wants

[3:15:58] to add one more >> and actually uh Steve this is uh my to

[3:16:03] you and a legitimate of uh everything I've read was that the mayor must sign

[3:16:10] the designate depending on the type of government. So

[3:16:14] and then it should be I sign the resolution city secretary and then we

[3:16:19] pick the the designate. That's my understanding and that's

[3:16:24] everything that I've read. Uh we have David here, Wanita absolutely as

[3:16:29] designates, but the mayor still has to sign them and so I I want to bring that

[3:16:35] back and have a legitimate >> You can amend it.

[3:16:38] » We can amend it >> amend it right now.

[3:16:40] » Okay. So >> because in the many code quotes it says

[3:16:46] the only design of the city administrator and treasurer. So are we

[3:16:49] following this or who's the treasurer? When you make your motion, you would

[3:16:53] amend and to add anything to be updated. >> We we'll update it.

[3:17:00] » I just say just want to date it and then whatever you

[3:17:03] » we don't have a treasurer per se at the city. Um

[3:17:08] » that was years ago. Yeah. Remember our MUN codes haven't been updated since

[3:17:11] 2018. So it's been a long time. >> Next forever.

[3:17:16] » Yeah. Yeah. But but it's not me on the bottom. It's me, the city secretary uh

[3:17:21] signs off as a as a notary and then whoever we design designate and I would

[3:17:26] recommend that that be David. >> Absolutely. If the mayor wants her

[3:17:30] signature,

[3:17:35] » you have a second in favor of >> what to hold on

[3:17:41] » and remove Georgia. >> Yes. And then have David. So first

[3:17:46] Wanita certifies my signature and the

[3:17:49] designates at that point would be David and Wanita.

[3:17:52] » What what does it do exactly with this by changing the desk? What what are they

[3:17:57] doing authorization? >> The mostly uh the design

[3:18:05] if we're going to change bank account for example two of the designates have

[3:18:09] to sign the form. If we remove Georgia at this point,

[3:18:13] Georgia is the person authorized to actually do the transactions.

[3:18:19] So if we remove Georgia, we actually have to pick another person to actually

[3:18:25] do the transactions with tech because there's only one person with text pool

[3:18:30] actually doing transactions. >> The others are designates to sign

[3:18:35] documents. >> Someone can make transactions. Your

[3:18:39] order makes the transaction >> as accounts payable. So you would have

[3:18:42] add you could add yourself as an extra >> what would what would be the easiest way

[3:18:45] to accommodate what Mayor Luna wants. >> What would be the

[3:18:49] » how do we how do we satisfy her request to be involved in the process without

[3:18:55] having her have to do the work. >> How do we make it a legal signature is

[3:18:59] what the answer is. Let's right side it. Go ahead.

[3:19:05] » Okay. And you would you would be my signature witness as and and David and

[3:19:11] and and Georgia would Okay, I'm good with that.

[3:19:14] » The reason that we included, Miss Martinez, as the person authorized to do

[3:19:18] the transactions, she's the one issuing the checks. So, she knows she made

[3:19:23] $100,000 worth of checks. We need to bring the money over for

[3:19:28] » I'm good with that. I just want to write say I'm just looking at the legality and

[3:19:32] what I read and and and and doing it appropriately. So,

[3:19:36] Right. >> I I just don't want to place an

[3:19:39] administrative burden on you because you're not at city hall.

[3:19:43] » No, absolutely. But oversight is always best for everyone else.

[3:19:47] » So, absolutely. I'm good with that. So, uh do we have a motion?

[3:19:53] » Let me put it to you. Let me tell you the question.

[3:19:54] » So, what exactly is the motion? >> Yes.

[3:20:00] the signature and she verifies my signature and David

[3:20:05] and Georgia are the ones that move the money around to invest.

[3:20:09] » All right. So, you have a motion. Do I have a second? All in favor?

[3:20:14] » All opposed? >> And I'm included in there also as a view

[3:20:20] only. >> As a view only. Okay. So, then put your

[3:20:23] name in there as a view only until we get that position filled. That way we

[3:20:27] know all who has the capability. Okay. >> Once you fill the position, we can do

[3:20:32] another resolution and change. >> Thank you, Mr. Woods.

[3:20:38] » We still have other things.

[3:20:42] » Yes. Yes, I'm here. >> Moving along.

[3:20:47] » All right. Here we go. Number 12. This is uh number 12 is to discuss and

[3:20:52] consider and approve the plan of finance to issue one or more series of tax notes

[3:20:58] authorizing the city staff, bond council and financial advisors to proceed with

[3:21:03] such financial approving this matter incident and rel uh related to there

[3:21:09] too. >> Good evening mayor, council members, Mr.

[3:21:13] Riot and staff. For the record, Robert the Financial Consulting. We are the

[3:21:18] city's financial advisor and I'm here this evening to present the plan of

[3:21:23] finance tax note series 2026. Now I am sharing the presentation on the

[3:21:30] screen and on page two we have the proposed

[3:21:34] projects. The projects consist of water and wastewater system projects. I

[3:21:39] believe uh some of the issues that occurred with the recent flooding. Uh

[3:21:43] the estimated cost for the projects is about 1,525,000.

[3:21:50] That number was provided to us uh by Mr. Wright. And the estimated cost of

[3:21:55] issuance about 100,000 and that includes all consultant fees, uh financial

[3:22:01] advisor, bond counsel, the placement agent, uh the purchasing bank attorney,

[3:22:06] uh the attorney general's office, all of that's included in the 100,000. And

[3:22:11] again, it's preliminary. We'll know more or less come time when the bids are due

[3:22:16] in about a month or so. Uh mayor, council members, any questions on page

[3:22:22] two?

[3:22:27] » No. No. >> If not, on page three, we have the

[3:22:31] estimated tax rate impact analysis. Uh we have the city's property values on

[3:22:36] column B. There's a slight dip on final net certified values on column B, row

[3:22:43] 10. So it went from 228.5 million to 225.6

[3:22:49] million. Uh we have the city's existing principal and interest debt on column D.

[3:22:55] And we have the proposed tax note financing. Uh the tax notes going to be

[3:23:00] for seven years. It's going to have a seven-year maturity. The first three

[3:23:04] years we're making the payments uh relatively skinny and then the last four

[3:23:09] years we're showing a level debt payment about 440,000 a year from year four to

[3:23:16] year 7. By law we cannot exceed seven years when we're issuing tax notes. The

[3:23:23] estimated interest rate we're looking at right now is about 4.5%

[3:23:28] and that's on column row 44.

[3:23:33] And then again how this financing will be paid back. We're are we are going to

[3:23:40] use a transfer from the utility system. In other words, this will be

[3:23:44] self-supporting. So will not impact the INS tax rate. And again, anytime the

[3:23:51] council can change that, they can either use utility revenues or INS tax rate

[3:23:59] levy revenues in order to pay the debt back. But right now, we're looking at

[3:24:02] this potential loan to be self-supporting. So that's why we have

[3:24:07] on column I a negative amount which matches exactly what the loan is on

[3:24:12] column E. So there is no impact to the INS tax rate on column K. It's roughly

[3:24:20] 47 cents uh this current fiscal year and roughly 47.5

[3:24:25] uh the next two. Any questions on page three?

[3:24:32] Okay, I'll turn to page four. We have the timetable again this evening.

[3:24:40] Bear, you and the council are just approving the plan of finance. This

[3:24:45] allows your financial advisor, your bond counsel to work with Mr. Wright will

[3:24:51] come and staff will come back at a later date and that later date will be

[3:24:57] Thursday, September the 24th. In between today and the 24th of September, we're

[3:25:04] going to be working on a term bid sheet. uh the placement agent is going to send

[3:25:08] that final term bid sheet to the uh potential banks that are going to be

[3:25:14] bidding on the loan. When I say potential banks, it's a minimum of 25

[3:25:19] banks instate and out of state. 25 or more banks that will receive your

[3:25:24] information, your audit, this presentation, and other legal and

[3:25:28] financial information. And they'll consider submitting a bid. And the bids

[3:25:34] will be due on Thursday, September the 24th, that morning at 10:00. And we're

[3:25:40] potentially, again, if Mr. Wright lets us know here in the next couple of days,

[3:25:45] if Thursday, September 24th, works for the city council to meet. And if so, the

[3:25:51] bids will be due that morning. And that evening, we'll present the lowest

[3:25:57] interest rate to the city council for their

[3:26:02] consideration for the financing to be approved as final. So again, today,

[3:26:07] you're not approving to get into a loan. You're not approving uh to borrow $1.6

[3:26:13] million. All you're approving is to allow your consultants to work with Mr.

[3:26:18] right, and your staff to come back more or less on September the 24th

[3:26:24] and bring you a financing with the lowest interest rate. And at that

[3:26:30] evening, you'll be considering the financing as final. And if you approve

[3:26:35] it, you'll receive the funds on October the 15th,

[3:26:41] just about three weeks later. Any questions, Mayor? council members.

[3:26:48] » So, so the uh reason that we're doing this and we contacted Mr. Ticaradina is

[3:26:53] uh the flood that we have here in the community. Uh there's no guarantees at

[3:26:57] this point when FEMA would reimburse the city for uh the damages that occurred to

[3:27:03] infrastructure within the city which we did have uh two lift stations which one

[3:27:07] is located at Jack Curtis property. one only Garage Street was they were both

[3:27:12] 100% destroyed by the floodwaters. Uh wastewater plant received a lot of dirt,

[3:27:17] sand, and rock. Uh it messed up our mechanical bar screens that we currently

[3:27:22] have in place. Uh they the shafts in them literally broke because of the

[3:27:26] amount of debris that came through. Um the city under emergency declaration and

[3:27:31] city's had to put out money to uh to fix these things and mitigate them. also the

[3:27:37] mitigation uh keep compliance with TCEQ. Uh when the lift stations went down, we

[3:27:41] bypassed them with pump trucks. Um all that was cost to the city. So um FEMA

[3:27:49] has said it could be from two months to two years before there is any type of

[3:27:52] reimbursement. Uh they got a little skittish because they're saying that

[3:27:56] President Trump has not signed the major disaster declaration for this area. So,

[3:28:03] they're concerned if there even will be any significant reimbursements. Um, and

[3:28:08] this is what's prompting prompting administration to actually take out a

[3:28:11] bank loan. Um, moving forward from this, you notice Mr. Tikarina said that the

[3:28:16] first few years would be skinny. Um, what we're hoping for in the first two

[3:28:21] years or even to four years, we're going to hope that FEMA reimburse. If FEMA

[3:28:26] does not reimburse, our second outlet is going to be the Texas Water Development

[3:28:29] Board, which gives municipalities 0% loans. The problem with water

[3:28:34] development board is they take over a year to approve them. So the the need is

[3:28:39] today it's not in a year. So that's why we're trying to go this route.

[3:28:44] » And this is a total impact from the flooding been there. Was there

[3:28:49] » two? >> There's there's two lift stations. Uh

[3:28:52] each lift station has uh two uh two pumps each. So there's four plus all the

[3:28:57] electrical panels. Everything went under the underwater.

[3:29:02] » Uh Legarda Street and then out on IH35 on Jack Curtis property, which is the

[3:29:06] more the bigger one. I think that one handled probably about 30% of the

[3:29:10] community. Um and it is already they're already working on repairing that one

[3:29:15] and actually replacing almost everything there.

[3:29:18] David, uh, just to to clarify, and I know you and I had talked about this a

[3:29:22] couple of times, but so that I know Mr. Alvarado had mentioned it also, will you

[3:29:27] be trying to mitigate especially Jack Curtis pump to get that some of that

[3:29:32] electrical out of there in the event that we have this happen again? So, so

[3:29:37] yes, one one other thing that was uh was told to the city is that they have

[3:29:42] mitigation plans through FEMA uh that are available and that they will

[3:29:48] do it and from from what they say they can be 100% paid by FEMA. Um is it true?

[3:29:54] I don't know because I haven't gone down the road yet, but that's what I have

[3:29:57] been told. >> So, everything is just dependent on that

[3:30:00] declaration and and we just don't have it. But no matter what, we need that we

[3:30:05] need that lift station. We need that back and operational. So David had told

[3:30:10] me that that takes about what 35% of our >> carries.

[3:30:14] » Yes. So the Jack Curtis does that's that's a lot of your commercial uh waste

[3:30:19] waterers going to that one. Legally is less significant. Um but where we are at

[3:30:23] right now is both of those lift stations are bypassed with diesel pumps and we

[3:30:27] know how much diesel is compared to rental pump. Um the Garage Street I I've

[3:30:34] gotten more than one quote because I've had time to do that and I've gotten two

[3:30:40] pretty different numbers. You know, I got a $115,000

[3:30:43] number and I got a $250,000 number to to repair. So, obviously, I'll be coming to

[3:30:49] council for the the lower amount. The last thing last thing too is the

[3:30:55] monies that that we borrow from the city are going to be specific to the projects

[3:30:59] for the flood. So if we don't use that dollar amount, it gets returned to the

[3:31:04] bank. So they're going to keep track of exactly what it's being used for and if

[3:31:08] we don't use it, we return it and they take that off of our debt obligation.

[3:31:13] » It'll be back to >> correct payroll with it or none of that.

[3:31:18] For repair the flood

[3:31:21] » specifically for the flood. Yes. >> Any qu any other questions? So, what do

[3:31:26] we need today, David? >> Uh, need a motion of approval really for

[3:31:30] the agenda item. >> Okay.

[3:31:32] » And then after that, Mr. Ticketing is going to advertise the bank and he was

[3:31:36] interested in uh giving us a loan. >> All right. So, I'm asking for a motion

[3:31:40] to approve a plan of finance to issue out one or more series of tax notes for

[3:31:46] the city. Do I have a second?

[3:31:51] Uh m Mr. Garcia second. All in favor of approving the plan to finance uh the

[3:31:56] flood mitigation project say I. >> All opposed. Motion carries.

[3:32:03] » Thank you, mayor, council members, Mr. Wright. I appreciate the opportunity to

[3:32:07] present this evening. I hope everybody has a great night.

[3:32:09] » Thank you. Thank you. >> Thank you, Robert.

[3:32:11] » Yes. Thank you. >> All right.

[3:32:16] This is number 13. to discuss and consider and act on approving a

[3:32:19] resolution by the board of aldermen of the city of Kula establishing the city's

[3:32:23] intention to reimburse itself to prior law lawful expenditures uh funds with

[3:32:28] the proceeding obligations to be issued on behalf of the city authorized

[3:32:33] purposes and the matters in connection there with

[3:32:37] » this one here is also for I believe for the bond council let's say

[3:32:43] » that's that's correct >> that's yours

[3:32:48] Oh, I'm sorry. The bottom >> uh Juan

[3:32:51] » Juan Auan. >> Yeah. Juan Aguilera. Can you all hear

[3:32:55] me? >> Yes, we sure can.

[3:32:58] » Okay. Good evening. U mayor, council members, uh board board of alderman. U

[3:33:03] so what we have prepared for you today is a reimbursement resolution. This is

[3:33:08] something that uh the city has done in the past. Uh we've done it a number of

[3:33:13] times. And what it simply is is um since we're using um uh you you may go through

[3:33:20] some expenses u now for the uh the projects that were discussed by

[3:33:25] Robertina and Mr. Wright for the um the damage that has been done. So by

[3:33:32] adopting this resolution, you're making a formal declaration saying that you may

[3:33:38] want to reimburse yourselves for any expenditures that you make now before

[3:33:44] you start getting uh receive funds from the tax notes. This resolution does not

[3:33:50] in any way obligate the city to issue any tax notes or to do or to enter into

[3:33:57] any kind of a of an obligation or debt in in in later on. The only thing that

[3:34:03] it does is it meets the requirements of federal tax laws to allow you if you

[3:34:10] wish also to be to reimburse yourselves for for expenditures that you may make

[3:34:17] between now and when you if and when you issue debt. So again, uh this is all for

[3:34:25] uh federal tax purposes and u it'll if if the city is going to be making some

[3:34:32] expenditures, it's always a good idea to have this reimbursement resolution in

[3:34:37] place. Are there any questions? those are. So, so just to uh add on to

[3:34:44] what he's saying, uh everything that has been like has been spent or services

[3:34:49] that have been done due to the flooding, the city has not paid those vendors. So,

[3:34:54] we wanted to have this resolution in place before we paid those vendors so

[3:34:59] that the bank sees that and see that the council already approved it. So, what

[3:35:04] happened during the flooding was, and I was right there with David, uh, uh,

[3:35:07] companies came up right away without question and said, "How many trucks do

[3:35:11] you need? Who do you need?" And they were they were at it. Uh, at that point

[3:35:16] it was it was a it was a disaster and they acted on it accordingly and those

[3:35:21] those people got to get paid now. I mean, you know, they they they did their

[3:35:25] part uh without fail. And so we did David and the team and some some of the

[3:35:31] city members did everything they could to try to salvage what we had, but it

[3:35:35] was just inevitable just so >> and and I I'd like to point out, mayor,

[3:35:41] that the resolution and and this is in accordance to the uh the tax laws, the

[3:35:46] federal tax laws. uh if by adopting this resolution we can go backwards 60 days.

[3:35:53] So any expenses that you have incurred uh backward from uh you know two months

[3:36:00] from from today's if you decide to move forward with the adoption of the of the

[3:36:05] resolution you can we can go back 60 days and capture any kind of expenses so

[3:36:11] that you could be able to reimburse yourself in the future.

[3:36:17] and moving forward three years. >> Go ahead.

[3:36:22] » No, that's Go ahead. >> No, that that that's it. So, just

[3:36:25] backwards 30 60 days. So, any expenditure that you made 60 days u uh

[3:36:31] before today and then forward it's uh three years up to three years.

[3:36:43] All right. That being said, on item 13, do we have approval to uh to approve

[3:36:49] this resolution, a board of alderman for the city of Cachula to establish the

[3:36:52] city intention to reimburse itself? >> I have a motion.

[3:36:58] » Second. >> You second it. All in favor of approving

[3:37:00] this uh resolution say I. All opposed. First, Miss Yanes. Second, Mr.

[3:37:09] Rodriguez. Motion carries. Thank you very much, mayor. And and uh

[3:37:15] we are available just at any any further uh questions or or anything else that we

[3:37:21] could help the city. I know that you have quite a number of projects that

[3:37:25] you're considering. And we've been working with the city now since uh 2011

[3:37:30] and uh anything we could do uh to to help just just let us know. Well, again,

[3:37:37] » we we we do work strictly on on the bond financing end, anything having to do

[3:37:43] with the financing. Uh, but we will work in in on tangent with your your city

[3:37:49] attorney and then of course Mr. Deherina, Jeff Snowden. I've known Jeff

[3:37:53] for a long time. I've worked with Mr. Wright. So, anything we could do as part

[3:37:56] of the team, uh, let us know. >> Thank you so much. We we appreciate

[3:38:01] that, sir. >> Thank you.

[3:38:04] » Good night. Good night. >> Right, moving on to number 14. Can we

[3:38:09] already say yes? I'm going to let them do their deal, but

[3:38:13] we've always helped out with this. I'm going to recommend also that that we

[3:38:17] don't hold them up any longer. I'm going to let uh uh Miss Morales and

[3:38:23] give us their presentation and we'll work from there. This is item for 14.

[3:38:28] discuss and consider and request Sheriff Ramita says uh to join partnership in

[3:38:32] this year's National Night Out event. Go ahead.

[3:38:36] » Y'all had a y'all had a a long night, so I won't take up too too much of your

[3:38:41] time. So, uh y'all know me. My name is Rosario Morales and I'm here

[3:38:44] representing the sheriff's office along with my coworker, Mr. Angela, who is

[3:38:49] also our PIO. And um I passed out earlier a save the date just to kind of

[3:38:54] get an idea of what we're you know we're proposing. Um the agenda item is to join

[3:39:00] in partnership with uh this year's National Night Out. Um and like you said

[3:39:05] in the past y'all have uh helped the county or the sheriff's office to help

[3:39:11] uh put on this event. And so um that's what we're here for to make that request

[3:39:18] to uh join in partnership. Our plan is to host this um on October 6 which is a

[3:39:23] Tuesday um from 5 to 8 and we're looking at Plasa Flora uh because the park in

[3:39:30] town is not ready yet of course and um so National Night Out Mr. I kind of

[3:39:37] elaborate, but um it's basically a community event um where we host

[3:39:42] different uh music and um vendors uh free to the public and free uh for

[3:39:50] people to come and visit with first responders, uh local law enforcement, uh

[3:39:55] businesses in the community and things such as that. So, I don't know if you

[3:39:59] want to add any fields.

[3:40:02] » Correct. Correct. So, um it's an annual thing and that's why weird that it's a

[3:40:06] Tuesday, but that's a national night out and I think all the cities along I35

[3:40:12] that you might know um also hosted in the same time. Um so we are, you know,

[3:40:20] hoping to promote that uh community involvement with the school. We put it

[3:40:24] out to the school, the community. Um we do get people that come from out of town

[3:40:29] because they have family here and they know the locals. Um and so we're hoping

[3:40:34] to put on event like that last year. Last year we were able to host a car

[3:40:38] show. Um we had a band um different things like that. Um giveaways,

[3:40:43] different local vendors and elected officials. The city was there. Everyone

[3:40:48] gave out stuff and it was a well uh uh uh planned I guess organized and

[3:40:55] attended event. So we're here to ask answer any questions they may have.

[3:41:04] You make a motion to approve. How are we supporting?

[3:41:09] » I heard that you're possibly hoping that people come from out of town into Cula

[3:41:15] to attend the event. um if something like that happens and it's it's uh

[3:41:20] there's advertisement also included to that effect that the event is eligible

[3:41:25] for hottack um the city could make a hot tack

[3:41:28] donation towards the event and I believe the city did last year if I remember

[3:41:32] correctly >> number from last year and um it's it was

[3:41:36] around $7,400 and that included uh music uh the bounce houses that we had um the

[3:41:45] portable or portaotties that we had. >> Is that your total amount that you paid

[3:41:50] for the event? >> Uh, no. We had other uh uh donations. We

[3:41:55] rely on donations from the community or businesses that donate to the sheriff's

[3:41:59] office um to help put on those things because of course um we give away things

[3:42:05] so we have to buy the you know those kind of things to post. Do we have

[3:42:09] documentation of how much we help with? >> Yes.

[3:42:16] not to cheat. That's what I was asking. That's why I'm saying and also or

[3:42:20] something like that. >> Are there any other major organizations

[3:42:22] that donate to you besides the city and of course the sheriff's department?

[3:42:27] » Um at this at this time, no. Um we are going to go to the county as well, but

[3:42:32] um like I said, we rely on donations. David, does that include waving the fee

[3:42:38] at the at the plot?

[3:42:42] » All right. >> Um I would make a recommendation not to

[3:42:45] exceed $10,000 and then we can go from there. That would be administration's

[3:42:49] recommendation.

[3:42:56] The first motion would be not to exceed $10,000 to include the the waving of the

[3:43:01] fee for Las the uh plat. >> All right. All in favor of approving not

[3:43:08] to exceed uh for the national night out $10,000 and the waving of the fee for

[3:43:12] the plat say I. I. >> All opposed. Motion carries.

[3:43:19] » We'll be back with more information and uh info to sign up as vendors. Thank

[3:43:25] you. >> All right. Sh.

[3:43:27] » Good night. >> Good night.

[3:43:31] » I know we're going to go into close session with number 15. Um and I also we

[3:43:36] have a big discussion on number 17. I know that we we have been at it for a

[3:43:41] while. Uh even before I go into close session, I want to bring up number 17

[3:43:45] and I want to table that to a special meeting and u with discussion with uh

[3:43:50] David and and Steve. I think that uh this requires a little more attention

[3:43:55] and and a little more inform information and things like that. So, I want I would

[3:43:59] like to request to mo uh a motion for uh tableabling this item. And you you

[3:44:04] picked the dates. Y'all tell me when do uh what what how far can we uh go to

[3:44:12] a special meeting? >> Personally, I would like it to be as

[3:44:15] soon as possible. I'm just asking for my own protection to have some kind of

[3:44:19] investigation or council. So, I I don't understand why we really need to pay

[3:44:24] table it, but if you want to, we sure can.

[3:44:28] Okay. So, we'll talk about that in close session. We're going to go in and move

[3:44:32] on to item number 15. And this is to uh consult with attorney. This is close

[3:44:38] session Texas government code as annotated in section 551.071

[3:44:43] one consultation with attorney pending or contemplated litigation. Uh item 15A

[3:44:49] is ethics. Item 15B is employee grievances. And item 15 C is agendas.

[3:44:58] And the time is 10:10. can

[4:28:42] All

[4:28:55] right, we are back in session. The time is 10:54.

[4:29:01] 10:54 p.m. Uh, we had discussion. No action was

[4:29:07] taken in executive session on 15A ethics, 15B employee agrievances or 15C

[4:29:15] agenda. So we are currently back in session.

[4:29:22] So we don't have any actions to take on item 15.

[4:29:29] On item 17, do I have a motion for discussion

[4:29:36] or a motion from the city council?

[4:29:49] I'll ask for if we have a motion one more time on number 17.

[4:29:56] If no motion on number 17 at this point, there's no action on item number 17.

[4:30:14] All right. Number 618. Do I have a motion to adjurnn?

[4:30:20] » All in favor of adjourning? Do I get a second?

[4:30:24] Second. >> All in favor of adjournment

[4:30:27] » say I. >> All opposed.

[4:30:31] We are journed.

City Council Meeting - August 27, 2026

Agenda

Transcript