[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.