[0:00] critical issue for our community
and state and after being appointed to
[0:04] fill
Senator Greg Myers seat earlier this
[0:08] year
Senator Garson took this opportunity to
[0:11] dive deeper into the challenges
We would just want to say thank you
[0:17] to Senator Garson for spending time with
us in Owasco.
[0:21] And to the public, if you're not
currently following Owasco
[0:25] on social media like Facebook or Twitter
please consider doing so.
[0:31] Steven
Winters
[0:34] led a discussion on Monday, August 10th
with the Orange County Commission for
[0:39] the environment
on Owasco's draft P fast
[0:44] guiding principles. Mary Tiger attended
as well
[0:48] to capture the discussion for the
board's consideration
[0:51] in finalizing the guiding principles.
Number four
[0:57] the Owasco Board of Directors cancelled
the effective board governance training
[1:01] that was to take place today.
August 13th, this will be rescheduled
[1:07] at a later date so that all board
members can attend. We were short board
[1:11] members
today.
[1:15] And number five
the Owasco Board of Directors and staff
[1:19] communications workshop
will be held on August 27th, 2026, but
[1:25] that's tentative
pending some board polling results.
[1:31] That's all I have. Are there any other
announcements by board members?
[1:37] Hearing none.
>> Oh, it's just
[1:39] that next month I'm going to be out.
So, I won't be attending next month.
[1:45] » We will continue to miss you.
Thank you for giving us a heads up on
[1:49] that. Anybody else?
[1:54] » No, uh we we can talk after the board
meeting.
[1:57] That'd be great.
>> Okay, thank you.
[2:00] » Can I actually clarify, [clears throat]
sorry, for everyone?
[2:03] » Sure, go ahead.
>> Can you actually clarify for everyone
[2:05] that so the communications workshop
would be pushed to uh September?
[2:12] » Oh, the
the effective governance training
[2:15] um proposed to September, do you mean?
Or the communications workshop?
[2:21] » I'm not sure. What's what's beyond it in
here?
[2:24] » Well, the universal um the universal
board of directors and staff
[2:27] communications workshop scheduled on
August 27th,
[2:32] 2026.
But that's tentative pending on board
[2:36] polling results to make sure we can
attend.
[2:39] » So the workshop that was canceled today
would not be moved and the other one
[2:42] pushed back. My understanding is they
were sequential.
[2:45] » The one that's canceled to those
canceled for today, I'm going to poll
[2:50] all the board members
to see when we can schedule another date
[2:53] for that.
>> date.
[2:54] » Yeah. Thanks for clarifying.
Good point.
[2:58] Yeah, so we will hold the
effective board governance training
[3:02] session when we can get most of the
board here.
[3:06] And I was, you know, thinking September.
April's not going to be here in
[3:10] September, so we will arrange a date
when the board can be here.
[3:16] » Great.
>> All right.
[3:19] Was that good enough?
>> Um did you have a question?
[3:21] » Yes, I'm sorry.
>> So
[3:24] we will not have the session unless all
board members can be present. Is that
[3:29] is that your intent?
>> That would be my intent to make sure
[3:32] that all the board members are present.
>> Okay.
[3:35] » [clears throat]
>> Just want to make sure that that's what
[3:37] we're going to go for and not change.
>> Yes, ma'am.
[3:41] » And and they would not go out of order
then?
[3:43] » No, that can't happen.
They being the follow-up
[3:47] » The three planned workshops.
>> staff communications workshop?
[3:51] » Uh all this all three all of the series.
>> The series of three, yeah, would
[3:55] continue as a series of three.
>> In that order.
[3:57] » Yeah.
>> Okay.
[3:59] » [clears throat]
[4:07] » Is that good?
>> I have no idea.
[4:10] I don't know what those dates are going
to be.
[4:11] » Yeah, neither do we. Yeah, till we pull
the board.
[4:15] Pick the dates.
[4:19] » I'm trying to be out of town on the 27th
of August. [snorts]
[4:26] » As am I.
[4:29] » Okay.
There you go.
[4:32] That's very helpful. Thanks.
[4:36] » I'm trying to be away.
>> We will
[4:40] We will duly note it.
As we move forward. Thanks so much.
[4:47] Any other announcements by board
members?
[4:49] » [clears throat]
>> How about announcements by staff?
[4:53] » No, thank you.
>> All right.
[4:55] Are there any petitions or requests from
the public?
[5:01] If there are any petitions or re-
requests to speak,
[5:05] there's any individuals, please approach
the podium, state your name, and
[5:08] organize your remarks in a permitted
timeframe. We do have a speaker
[5:12] scheduled
for a specific item on the consent
[5:14] agenda. This does not include that.
All right.
[5:20] Are there any petitions and requests
from board members?
[5:26] Hearing none, I actually have a petition
to
[5:30] ask with the staff.
And the petition would be um
[5:34] would be possible
that the staff
[5:38] could sometime in a coming meeting
um provide a briefing to the board on
[5:45] the approach
and constraints of hiring consulting
[5:49] engineers to do the design projects
that we [clears throat] do.
[5:54] » [snorts]
>> And um
[5:56] And and I had a briefing on this from
the executive group earlier this week
[6:01] and there's several different processes
involved that um I think it would be
[6:05] good if we were just aware of them
uh considering that uh
[6:10] you know,
we do approve some construction
[6:12] contracts. Yes, Todd.
>> I'll say that's uh something that the
[6:16] board's interested in, we can certainly
get that scheduled.
[6:19] » All right. Can I have a show of hands
from the board of everybody that would
[6:22] be interested in it?
[6:26] Good.
Thank you very much.
[6:33] Are there any petitions and requests
from staff?
[6:36] » Uh thank you.
>> The board will move into the consent
[6:40] agenda
and we have three items.
[6:44] I have to read them all and then we'll
just have a brief conversation about one
[6:48] of them.
Item number one in the consent agenda is
[6:52] looking for the approval of the minutes
of the July 9th, 2026 meeting.
[6:57] » Wait, Michael, I'm sorry to interrupt,
but I think that the appropriate method
[7:00] is to pull something if something's to
be discussed um
[7:04] if we're going to have a presentation or
discussion about it, we should just pull
[7:07] it from the consent agenda and move it
in to a different category on the on the
[7:11] agenda.
Um
[7:14] So, is there I'm assuming it's item
number two under the consent agenda that
[7:18] perhaps we need to pull and move it?
>> That was what I was going to suggest
[7:22] when I got to it just now.
>> Okay. Well,
[7:25] then I'd like to make the motion that we
pull item C2 from the consent agenda and
[7:31] move that into um
[7:36] discussion
into under E for discussion.
[7:40] Uh would you think that that's the
appropriate place to put it?
[7:45] » Um, I think that might be the
appropriate place to put it and I was
[7:48] going to announce to the public that
that was, um, item number two to the
[7:51] word of the galvanized service line
replacement contract. And yes, um, I
[7:56] would
suggest
[7:58] » it.
>> You
[8:00] want to pull?
>> Okay, so let's move it to make item C2
[8:04] becomes item E2.
>> Second.
[8:07] » All in favor.
>> All in favor. [laughter]
[8:09] » All right, yeah.
>> Thank you, Susanna. Thank you for your
[8:11] time.
Um, [clears throat] item number three is
[8:14] a resolution to adjust the board member
compensation.
[8:19] And
I'm going to note that we have one
[8:21] member of the public signed up to speak
on the award for the galvanized service
[8:26] line replacement construction contract.
That would be Mr. Woods.
[8:30] Um, Mr. Woods, please come to the
podium.
[8:33] » Uh, may I suggest that that the
appropriate time for that is where where
[8:37] it is now on the agenda at E2.
That it's that that's then the
[8:42] appropriate time for us to talk about
that.
[8:45] » Thank you.
>> Starting.
[8:47] » No, it's all it's all good. I appreciate
that.
[8:49] Thanks very much.
Um, then I would ask, are there any
[8:53] public comments on the consent agenda?
[8:58] Are there any questions or comments or
would a board member like to pull
[9:02] another item from the consent agenda?
>> I have a question.
[9:05] » Yes, ma'am.
>> Um, on item three, I just want to
[9:10] clarify, um, whether or not board
attendance at the meeting is required
[9:15] each month
in order to receive the compensation.
[9:20] » Could you all talk up a little louder? I
I'm not hard of hearing, but with this
[9:24] environment it is difficult to hear. And
I can't imagine anybody over there can
[9:29] hear. Can you?
Hear what's going on?
[9:32] » let's not address the audience.
>> I'm sorry.
[9:34] » It's okay.
>> I'll ask for mic help if it's needed. Um
[9:38] Bob
>> Well, that's part of what the board
[9:42] might might discuss and decide one way
or the other. I think that the uh
[9:48] the idea behind the draft petition the
resolution drafted is that the uh
[9:55] regular monthly stipend is for all the
work that gets done including attendance
[10:00] to the meetings and including meetings
that you cannot attend but that you've
[10:04] had to do the work for to get ready for
as if you were.
[10:08] So, the idea behind the resolution was
that you'd be paid
[10:12] uh
the same monthly stipend
[10:15] » [cough]
>> um
[10:15] » [clears throat]
>> whether you attended a meeting or not.
[10:20] And it's drafted in such a way that it's
quite easy to change if you want to make
[10:25] attendance required. So, that you only
are only paid for those months in which
[10:29] you attend a meeting.
That could be done but that's um
[10:34] uh the original intent of the resolution
was to
[10:37] recognize that board members do a lot of
work to get ready for meetings even the
[10:42] meetings that they're not able to
attend.
[10:45] And so, the monthly stipend covers that
work. The additional
[10:50] meeting stipend covers additional
meetings after the first regular meeting
[10:55] of the month.
>> [snorts]
[10:56] » Okay, so where it says as each is able
to attend that means
[11:00] whether or not we actually attend.
>> That's exactly what that means.
[11:04] » And then for the additional meetings,
the attendance is required.
[11:08] » That's exactly what that means.
>> Okay, thank you. I just wanted to
[11:10] clarify.
>> Thanks for asking.
[11:14] » I move [clears throat] that we approve
the items on the consent agenda.
[11:17] Items one and three on the [snorts]
consent agenda.
[11:20] » Uh I'm sorry, I can't [clears throat]
hear
[11:22] » I move that we approve the items on the
consent agenda.
[11:26] » I second that.
>> Thank you.
[11:30] All in favor, say aye.
>> Aye.
[11:33] All opposed, say nay.
Okay, cuz a motion was made by Susanna
[11:39] and seconded by Judy. Thank you very
much for the
[11:44] So, the board now is going to move on to
the action item agenda, which is number
[11:48] one.
Resolution honoring Stephanie Glasgow's
[11:53] years of service.
Todd Taylor's
[11:57] going to begin this item or provide
providing some very brief remarks. Mr.
[12:02] Taylor.
[12:05] » Yeah, thank [snorts] you. Tonight, we do
have the privilege [clears throat] of
[12:08] honoring Ms. Stephanie Glasgow, Owasso's
director of human resources for 36 years
[12:14] of service.
And that kind of milestone is rare these
[12:17] days when people change jobs like they
change their clothes.
[12:21] But, those of us that have worked with
Stephanie for all these years, we know
[12:25] her dedication and commitment to the
work we do,
[12:28] the community we serve, and most
importantly, to the people here that get
[12:31] it all done on every day.
And retirement is a difficult decision
[12:36] for some people, and I I certainly know
it was for Stephanie.
[12:40] Uh
She's like an artist whose work is not
[12:43] just a product that she's producing,
but that that may something that they
[12:48] poured a piece of themselves into. So,
Owasso is part of her, and she is part
[12:54] of Owasso.
And we have been so fortunate fortunate
[12:58] to witness a true master at work for
these 36 years.
[13:02] Uh Stephanie has built a work
environment at Owasso where employees
[13:05] feel like they belong,
where they can be their best, and where
[13:09] they are truly cared about.
She is a treasure beyond value, and will
[13:13] be missed very deeply by us all.
As she transitions to the next phase of
[13:18] her life, we thank her for all she has
done for us, and we wish her much peace
[13:23] and happiness in the future.
[13:26] » Thank you, Mr. Taylor.
>> [applause]
[13:33] » Abe Curwen,
our esteemed former direct executive
[13:37] director of the Wassa, has also
requested to provide a brief statement.
[13:42] Thank you, Mr. Curwen.
>> You bet. Good evening, board, and thank
[13:46] you for your service on the Wassa board.
As you well know, it's a huge
[13:50] responsibility you you have.
Um
[13:54] and thanks for those words by Stephanie
Todd. Um
[13:57] you know, I join Wassa employees, past
and present, and the board
[14:01] [clears throat] of directors in honoring
and thanking Stephanie for her 36 years
[14:05] of dedicated and excellent service for
our team.
[14:09] She actively and cheerfully embraced her
responsibility to all 115 employees,
[14:15] regardless of their rank in the
organization, to make sure they all were
[14:19] treated fairly, respectfully, as
required in our HR policy.
[14:23] Stephanie always kept those focused on
safety.
[14:27] Of her many attributes, I believe her
genuine and unending care and support
[14:33] for our employees, who are our most
important resource, is what made her so
[14:37] successful and appreciated by all her
coworkers. And that was very evident
[14:44] today with the farewell party that the
staff had for Stephanie. There were so
[14:49] many retirees like me, older, younger
than me,
[14:53] um in addition to the current team. And
and I know everybody really had a great
[14:57] time today.
Um
[14:59] she worked very well independently
and took the initiative to stay on top
[15:04] of and implement HR best practices,
as very well documented in the
[15:09] resolution before you tonight.
Um Stephanie's provided this and
[15:13] previous boards the information needed
for the board to make informed decisions
[15:18] about competitive employee pay and
benefits. And and we certainly thank you
[15:23] and prior board for that.
True pleasure to work with Stephanie.
[15:28] Um
and I enjoyed working with her closely
[15:32] for 24 of her 36 and 1/2 years of
service, and I wish her and her family
[15:38] all the best in her well-earned
retirement. I really appreciate the
[15:42] board
taking this action to honor her. Thank
[15:45] you.
>> Thank you, Mr. Board.
[15:47] » [applause]
[15:51] [applause]
>> So, I will now read the resolution into
[15:55] the official record,
followed by presenting a printed copy to
[16:00] Stephanie Glasgow
in attendance.
[16:05] This is a resolution honoring the
service of Stephanie S. Glasgow to the
[16:10] Orange Water and Sewer Authority in
Carrboro, Chapel Hill, and the Orange
[16:14] County community.
Whereas, Stephanie Glasgow has served
[16:20] faithfully
and with unwavering dedication for more
[16:23] than 36 years
at the Orange Water and Sewer Authority,
[16:28] {parentheses} OWASA,
as human resources coordinator
[16:33] from January 1990
to August 22,
[16:38] then safety and training administrator
from August 2002
[16:44] to May 2010,
and lastly director of human resources
[16:50] from May 2010 until her retirement this
August in 2026.
[16:55] Devoting her career to serving the
employees of OWASA,
[16:59] the human resources and safety
profession,
[17:02] and the people of the Carrboro, Chapel
Hill,
[17:06] Orange County community.
And
[17:10] whereas, throughout her career,
Ms. Glasgow was committed to
[17:15] professional excellence by continually
expanding her knowledge and expertise
[17:21] earning the Society
for Human Resource Management {hyphen}
[17:26] Certified Professional
the Department of Labor Management of
[17:32] Environmental Safety and Health
and the Duke University Human Resource
[17:38] Management Certification and Master
Project Manager MPM certification.
[17:47] Whereas throughout her career, Ms.
Glasgow has committed to protecting the
[17:51] health and safety
of the Wasson employees
[17:56] by leading and strengthening Wasson's
comprehensive safety program.
[18:01] She championed a culture in which safety
was a shared responsibility
[18:07] through employee safety committees
comprehensive safety training
[18:13] voluntary OSHA audits
the spill response team and through
[18:20] accident investigation.
Her leadership extended beyond Wasson
[18:25] through her service as chair and vice
chair
[18:28] of the Mid-State Safety Council
she was recognized as Safety
[18:34] Professional of the Year
and recipient
[18:37] of the Shine Belkham Award
for her outstanding contributions
[18:42] to improving work space safety.
And
[18:47] whereas Ms. Glasgow
provided invaluable guidance to Wasson's
[18:51] leadership
and the Board of Directors to help
[18:54] ensure that Wasson's compensation
and benefits remain competitive
[19:01] she successfully led numerous
classification
[19:04] compensation and benefits studies and
championed
[19:08] employee focused benefits
including
[19:13] maternity and paternity leave
compassionate leave
[19:17] mentoring opportunities
and other programs that strengthened
[19:22] employee well-being
recruitment and retention.
[19:27] And
whereas Ms. Glasgow was committed to
[19:31] fostering a workplace
where every employee was treated with
[19:36] dignity, respect, and fairness.
She played a pivotal role in developing
[19:42] Alwase's diversity equity inclusion and
belonging program
[19:48] and promoted equitable employment
practices.
[19:53] Encouraged diverse participation
and perspectives in hiring
[19:58] and helped create a workplace
where our employees feel welcome
[20:04] valued
and supported.
[20:08] She strengthened Alwase's recruitment
onboarding
[20:12] and retention practices through diverse
interview panels
[20:17] structured onboarding and performance
check-ins
[20:21] the new employee welcome team
and professionally following up with the
[20:28] new hires throughout their first year of
employment
[20:32] to help ensure their long-term success.
And
[20:37] whereas knowing that strong
organizations
[20:40] are built on meaningful relationships
and a sense of belonging
[20:45] » [clears throat]
>> Ms. Glasgow for fostered a culture of
[20:48] appreciation
connection
[20:51] and engagement by establishing the
employee human resources team
[20:57] which meets monthly to share information
and identify opportunities to strengthen
[21:05] the workplace culture.
She also arranged highly successful
[21:10] employee engagement events,
including employee appreciation day,
[21:15] service awards,
holiday gatherings, and countless other
[21:19] opportunities that brought employees
together
[21:23] and strengthened the morale and culture
of Owosso.
[21:28] And
whereas throughout her career, Ms.
[21:31] Glasgow never lost sight
of the fact that an organization's
[21:36] greatest strength is its people.
She was a trusted advisor,
[21:42] thoughtful listener, mentor,
and advocate who approached every
[21:47] employee
with kindness, respect,
[21:51] compassion, and integrity.
Whether welcoming a new employee
[21:58] or helping someone navigate a difficult
situation or
[22:03] celebrating an important milestone, she
made people feel valued,
[22:07] supported, and genuinely cared for.
And
[22:12] whereas through her leadership,
compassion, professionalism,
[22:17] and unwavering commitment, Ms. Glasgow
has earned the admiration and respect of
[22:23] her colleagues.
Her influence extends far beyond
[22:27] policies and programs.
It lives in the people she has mentored,
[22:34] the careers she has helped shape, and
the workplace culture she helped create
[22:38] and nurture.
She leaves behind an enduring legacy
[22:43] of compassion, respect,
and service to Owosso and the community
[22:49] as she retires from Owosso
on August 19th, 2026.
[22:56] Now, therefore,
be it resolved by the Orange Water and
[23:00] Sewer Authority Board of Directors
that the Board of Directors of the
[23:06] Orange Water and Sewer Authority, OWASA,
hereby honors and expresses
[23:12] its sincere appreciation for the
distinguished public service
[23:15] of Stephanie S. Glasgow to OWASA
and the people of Carrboro, Chapel Hill,
[23:20] and Orange County.
And the Board of Directors congratulates
[23:25] Ms. Glasgow
on her extraordinary career
[23:29] and extends our best wishes for a long,
healthy, and fulfilling retirement.
[23:35] Adopted and presented on this 13th day
of August, 2026.
[23:40] May I have a motion and a second to
adopt Stephanie Glasgow's resolution?
[23:45] » I.
>> Second.
[23:47] » Great. We have a motion by Pedro and a
second by Karen. All in favor, say I.
[23:52] » I.
>> I.
[23:54] » Opposed? You're of course we're not
going to hear any.
[23:57] The motion passes
with
[24:00] seven affirmative votes. I think three
six, seven.
[24:07] Thanks.
[24:10] » [applause]
[24:16] [applause]
[24:24] [applause]
[24:27] » Can I go again?
>> Okay.
[24:29] » [laughter]
[24:40] [applause]
[24:48] » Very nice.
[24:52] » [clears throat]
>> Mr. Chair, could I make a um suggestion
[24:57] or a change to my suggestion about
moving the um
[25:01] uh the item from the consent agenda that
perhaps we have it as the first item
[25:07] under
discussion rather than the second so
[25:11] that uh
since we have a guest to
[25:14] » Yeah.
>> who'd like to comment so that he doesn't
[25:16] have to
so we don't feel rushed during our
[25:18] discussion of
item E1.
[25:22] » We have the guest speak first.
>> Oh, yeah. I'm reversing.
[25:26] » Yes, that's what I'm suggesting.
>> Great
[25:29] suggestion. So, we're going to
now take on the item that was on the
[25:34] consent agenda.
Am I correct?
[25:37] » Yes. Yes, that's what I'm suggesting
just to spare him our um our discussion
[25:43] later and also so that we don't feel
rushed to get to him.
[25:47] » [clears throat]
>> Thank you.
[25:47] » You're welcome. I apologize for not
having that foresight before.
[25:51] » It's all good.
So, we're now going to move on to
[25:55] discussing
and taking action on agenda item on the
[26:01] consent agenda item that we moved to
now.
[26:03] And
Mr. Woods
[26:06] » Might I suggest
Mr. Chair, might I suggest that Steve
[26:10] Bailey maybe come up and explain
>> Better yet.
[26:14] » project to the board and give you all
some context.
[26:17] » Thank you.
>> public comment.
[26:19] » Of course.
>> Thank you.
[26:20] » Um then we're going to have Steven
Bailey come and explain the
[26:23] background to the project.
Yes.
[26:26] » Nothing.
Nothing.
[26:29] » Okay. Good evening, board. I'm Steve
Bailey, capital projects manager.
[26:34] Tonight, we're requesting approval for
contract award for the galvanized
[26:38] service replacement program.
Um I believe the last time I was before
[26:42] you for this project was back in January
when we described the
[26:46] lead and copper rule program as well as
the GRR galvanized requiring replacement
[26:50] project that we were planning to proceed
with.
[26:53] Um since that time, the contract
documents have been completed and we bid
[26:57] the project. Um at the initial bid date,
we did not receive three bids that were
[27:02] required to open at the initial bid
opening. So, we had to re-advertise. On
[27:07] the second bid opening on January on
June 23rd, two bids were received and
[27:11] opened.
Following that opening, we followed our
[27:14] normal procedure of reviewing the bids.
On the initial review, we did see that
[27:19] the apparent low bid by BBUDC
Incorporated was less than half of the
[27:25] engineer's estimate for the project.
That raised some concerns about whether
[27:29] the bid adequately accounted for all of
the work including replacements,
[27:34] restoration, and coordination with
property owners, Owassa, and the towns.
[27:39] And if you remember, this project is the
replacement of the galvanized services
[27:45] from the water meters to the residents
and connecting either under the house or
[27:49] just outside the house, but most of them
will be done actually under the
[27:52] residents. So, all of this work is going
to be taking place on Most of it's going
[27:57] to be on private property. There'll be
some work in the public right-of-way at
[28:00] the connection point at the meters, but
it's going to require coordination with
[28:04] each of those individual property owners
to schedule the work
[28:08] and determine the location for the line
of the replacement and working through
[28:12] those issues on each individual
property.
[28:15] Um
During our review, BBUDC had not
[28:19] performed a CIP project for us in the
past. So, we did not have direct
[28:23] knowledge knowledge of the company's
capabilities or job performance.
[28:27] So, in order to gain some knowledge
about the company, we reached out to
[28:31] Owassa staff to see if they had worked
with them. Our distribution and
[28:35] collection staff did recall working with
them on a couple of projects and that
[28:39] there had been some issues on those
projects including other utilities or
[28:43] our utilities being hit.
They also let us know that one of those
[28:47] recent projects, uh the town of Chapel
Hill, had some issues.
[28:51] So, I reached out to town staff to
discuss the project with them. Um they
[28:56] let us know that there were some issues
there, including
[28:59] what from what they told me, work
beginning before the town was notified
[29:04] that they were working within the right
of way.
[29:06] They also, after the project had
started, they worked with them to
[29:09] continue it, trying to finish it, but
that they had notified the contractor
[29:13] and asked them to let them know when
they were going to do the backfill in
[29:16] the right of way so that they could
observe the work being done there. That
[29:20] did not happen,
um and it was done without the town's
[29:23] notice.
And then since then they say that the
[29:26] pavement repair in that area has failed
in the road, and they've had to try and
[29:30] work with the contractor to get it
repaired, and they've not been
[29:34] successful with that, and the
communication has been difficult.
[29:38] The galvanized service replacement
project is unique for OWASA because it's
[29:41] requiring this work on private property
and within homes, and will require
[29:46] require a great deal of communication
with the property owners, tenants, as
[29:50] well as OWASA and the towns.
Being that the bid was less than the
[29:54] half the engineer's estimate and the
references that we received, we
[29:57] determined that the bid was
non-responsible.
[30:00] We want this project to be successful
for everyone, and we do not believe that
[30:04] accepting the bid will be by BBUDC will
be in the best interest of OWASA.
[30:11] For those reasons, we're recommending
that the bid be awarded to Stonewall
[30:14] Construction.
And I'll be glad to answer any questions
[30:17] after the public comment.
[30:21] » Thank you, Mr. Bailey.
>> [clears throat]
[30:23] » So, um as uh the some of the board
members know, I printed out a a list of
[30:28] the protocol that the chair should
follow, and uh and I did that for my own
[30:32] benefit, um because occasionally I have
a hard time uh keeping us on track. Um
[30:39] and so, you know, theoretically some
clarifying questions would come now, but
[30:43] I think Mr. Bailey, we're going to go
ahead and uh with a comment from our
[30:47] citizen. So, please
uh Mr. Woods, come on up.
[30:59] » Good afternoon, Mr. Chair, board
members.
[31:02] I appreciate your time and I will try to
be brief.
[31:07] Uh my name is Isaac Woods. I'm the chief
executive officer for B Buxey. Some
[31:11] people spell it out B B U D C.
We've been
[31:15] contractors. I've been doing this over
30 years.
[31:18] Um
we're licensed.
[31:21] Uh we submitted the bid as he stated.
The part that concerns me is the false
[31:26] information
that he just mentioned to you.
[31:30] And I outlined that in my letter to Mr.
uh
[31:35] Bailey.
And I'm going to just be brief.
[31:40] First, we were the lowest bidder. B
Buxey is the lowest responsible and
[31:46] and responsive bidder.
There is mathematical errors in the in
[31:50] the engineer estimate.
B Buxey bid was 24% of the engineer
[31:56] estimate, not 54 as falsely stated in
your report.
[32:02] The The Stonewall
bid
[32:06] is 1.2 million.
B Buxey bid was 140,000. The engineer
[32:11] estimate is 977,000.
So, I'm not going to go through the
[32:16] fifth grade math. You can do the math.
The The
[32:20] summary also states the engineer
estimate was 1. 1,602,000
[32:25] and some change.
Well, if you do the big tab and do the
[32:28] math, it comes out to be 977,077.
[32:34] So, false information, you can't make a
good decision on false information.
[32:40] And we we're not going to go mathematics
cuz a fifth grader can figure this out.
[32:45] Now,
let me get to these false accusations
[32:49] Mr. Bailey just made and what he put in
his letter.
[32:52] Uh
First of all,
[32:56] we work with OWASA.
As any problems,
[33:01] we resolved it.
We didn't like the results, but
[33:06] underground utilities is something you
can't see.
[33:11] You expect OWASA
and any other utility company to locate
[33:14] them. When they don't locate them, it's
documented.
[33:18] Then
you have a problem. You lines may be
[33:23] hit, but the point happens is what did
you do to correct the damage?
[33:27] What he didn't tell you, if you look at
our supported documentation, is
[33:32] everything was corrected. We paid for
things that we didn't think we need to
[33:36] pay for. But for 30 years, you want to
give me four items.
[33:40] You want to talk about four items over
30-year period.
[33:44] And
and let me just be clear.
[33:46] He states he talks to people with Town
of Chapel Hill as shown
[33:52] in in the documents that I supported.
Town of Chapel Hill, you got the built
[33:56] you got the traffic control plan, you
got the permit, it was paid. Who he
[34:00] talked to, we've been trying to figure
out who all these people he got this
[34:03] information from. I asked for names,
addresses because when I talked to Town
[34:07] of Chapel Hill,
they don't know what the heck he Mr.
[34:10] Bailey's talking about.
And so I like the math.
[34:13] They're all making it all up.
The same thing applies with the work we
[34:18] did in OWASA. When you drive down, let
me just clear this up. When you go down
[34:22] Cameron Avenue today,
you won't see no at 506, the road's been
[34:27] paved. There's no deal There's no
problems. There's no written notice from
[34:31] Town of Chapel Hill saying B Boxley you
did defective work. That's what you
[34:35] don't have. All you have is some false
accusations written up by engineering
[34:39] and staff member
for some odd reasons to deny
[34:45] equal access on a bidding contract with
a lower price.
[34:49] In other words, they're telling you to
pay somebody $500,000 more
[34:54] to do the work
than the person that had the lowest bid
[34:58] and is qualified.
[35:01] His his his accusations are lacking
names, notices, or anything.
[35:09] And And the
>> [bell]
[35:11] » And to sum up this is
on one
[35:15] we did like 40 sewer taps, Rogers Road.
I mean, we all the way back from 2020.
[35:23] I mean,
yeah,
[35:25] he he filed his statement damaged
waterline. Yeah, waterline was damaged,
[35:28] wasn't marked. Well, Orange County, if
you look in the documentation that I
[35:32] provided,
they gave us a change order that said it
[35:35] wasn't marked and confirm it and paid us
like you're supposed to do. It's actual
[35:39] work.
Now,
[35:42] what concerns me
is
[35:45] is the first lovely town of Chapel Hill
and Carrboro and Orange County.
[35:52] Your diverse staff that I work with in
the field
[35:55] said they have made no comments in
regards to defective work on B Boxley.
[36:01] What you don't have is is I asked Mr.
Bailey
[36:05] and the engineers, "Who are you talking
to so I can approach them? Where are
[36:10] they names? Where are the written
notices that they gave B Boxley that the
[36:14] work was defective or substantial? Where
is that documentation at?"
[36:18] Without that, what you have is a bunch
of hearsay. What you have in the
[36:23] paperwork before you is you have
documentation.
[36:26] I can give you email change from Q and A
to Chapel Hill town.
[36:31] I gave you a permit
which contradict like he said, we didn't
[36:34] even give a permit.
Now, we have the same thing with Orange
[36:39] County. I gave you where they wrote up
the change order. I ask that you reject
[36:44] this offer to Stonewall who I don't
know.
[36:47] You need to make decision on correct,
accurate information.
[36:52] Not false information that they normally
falsified for some odd
[36:58] reason. And I appreciate your time. And
if you have any questions, I'll be glad
[37:02] to answer them.
>> Mr. Wood, let me just say on behalf of
[37:05] the board, thank you for coming forward
and and what you have said. And the
[37:10] board is going to have some questions of
Mr. Bailey,
[37:13] maybe you, and then we'll have a
discussion after that. But thank you.
[37:17] » Thank you.
>> All right.
[37:20] Well, this is the section where I'd like
for the board to ask clarifying
[37:23] questions. And we might start with Mr.
Bailey.
[37:28] Would be my suggestion.
[37:33] And of course, I'll call on any board
member that
[37:36] has a question to ask.
Yes.
[37:39] » Uh
a few I have a few questions if I may.
[37:42] » A few questions are okay.
>> Okay. Uh
[37:45] Mr. Bailey, Steve.
>> Yes, ma'am.
[37:47] » Um
Have we ever worked with the alternate,
[37:52] the $1.2 million bidder?
>> Yes, ma'am.
[37:55] » Uh have we been successful with them?
>> Yes, ma'am.
[37:59] » Um have they always been uh the lowest
or highest uh how many times would you
[38:04] say we've worked with them?
>> Um
[38:10] The one project they just completed at
the waste at the water plant for us.
[38:15] Uh I'm trying to think of another. They
bid several projects for us. They have
[38:18] not been the lowest price on all
projects. Um I don't have an exact
[38:23] number for how many they've done, but
they they actually did a couple of
[38:26] projects for us
during the recovery from Hurricane
[38:30] Chantal or from Tropical Storm Chantal
as well.
[38:33] » So, you're familiar with working with
them and you're satisfied with the work
[38:37] they performed.
>> Yes, ma'am.
[38:38] » What do you think is the disparity
between the the bid of the of
[38:44] Mr. Woods' company and
the this other company?
[38:48] » That I
don't I would hate to hazard a guess I
[38:51] guess about that.
>> That's a lot of money, half a million
[38:54] dollars.
>> I do want to clear up one thing about
[38:56] the estimate. The number that Mr. Woods
quoted from the bid tabulation,
[39:01] those two columns on the right far the
right-hand side are not the engineers'
[39:05] estimate. They're the average of the two
bids that were received. We never
[39:10] published the
engineers' estimate. Typically, when
[39:14] we're bidding a project, we don't
publish the engineers' estimate unless
[39:18] it's asked during the bidding process.
And I went back and reviewed the addenda
[39:22] and we never that question was not
asked, so we did not publish the
[39:26] estimate. But back in our January
presentation to the board for the
[39:30] project, we had the estimate of 1.6
million dollars in the presentation as
[39:34] well as the board agenda packet.
>> Why do you think there were only two
[39:39] bids on this particular project?
>> It's a unique project
[39:45] because it is something that typically a
plumber would do. Doing a service line
[39:51] like this, you actually have to be a
plumber to be able to pull the permit
[39:54] and do it.
But with the number of locations we're
[39:58] doing, it's not the type of work that a
typical that a plumbing contractor
[40:02] typically bids.
I think the number of sites that are
[40:07] involved
discourage Well, I know it discouraged
[40:10] one contractor. We had another general
contractor that has done work in the
[40:14] past for Owassa was interested in the
project and asked a lot of questions,
[40:19] but they ended up not bidding it and the
feedback they gave me was that their
[40:23] insurance company was not comfortable
with them bidding the project and being
[40:28] on that many different properties.
>> How um
[40:32] how long is the duration of the services
that are to be provided? Your best
[40:37] estimate. Is it 1 week, 6 weeks, 6
months?
[40:41] » Uh for each replacement or the total
>> total the entire project.
[40:45] » Uh I think we
provided 310 days
[40:51] uh for the work to get done because
there's
[40:54] we're estimating up to 90 sites if we
get everybody
[40:57] » 90 sites?
>> to agree to let us do it. So, yes.
[41:00] » Which takes two or three days per site
perhaps?
[41:02] » Yes. And and part of that is the
coordination of trying to get it
[41:06] scheduled and work out all the details.
>> Uh Mr. Woods uh indicated that you he
[41:13] didn't know who you had spoken to at the
town of Chapel Hill. Can Can you en-
[41:19] enlighten us, please?
>> They have told me that we can use their
[41:23] names. I don't know if um it's uh
Jason Staley, Greg Ling, and Michael
[41:29] Wright.
>> And what are their roles at the town of
[41:32] Chapel Hill?
>> Public Works Department
[41:34] uh within the Streets Department.
>> And so, they weren't happy with the
[41:38] results.
They wouldn't recommend is what your
[41:42] analysis is. So,
how do we
[41:47] uh the disparity of a half a million
dollars is significant given the cost of
[41:51] the project.
>> Yes.
[41:52] » Is there a way to um
if you How long you've How long have you
[41:58] been at WSACC?
>> Um
[42:01] Less than a year and a half. About 17
months.
[42:04] » Okay.
Um so, you're familiar with all the
[42:07] operations and you have excellent
management to oversee and discuss with
[42:11] you all these issues.
Um
[42:16] Your concern is that you will have
problems. My concern is is there any way
[42:21] with the higher bidder that we can
negotiate for a lower price?
[42:28] » I
>> All right, Mr.
[42:31] » Yes, sir.
>> think that's allowable in the bidding
[42:33] process.
>> Okay. Okay.
[42:35] I got you. Okay.
>> Yeah, and uh let me let me go around the
[42:38] table.
>> Okay, I just wanted to
[42:41] get something clear cuz I'm totally
unfamiliar with
[42:44] Thank you.
>> Thank you for asking them.
[42:46] Um now I see Todd and Elmira.
Elmira, please.
[42:51] » I have a couple of questions.
>> Yes, ma'am.
[42:53] » First one is um
do you investigate all of the
[42:57] contractors in the same way that you did
B Budsy
[43:02] in terms of the quality? Do you go
looking to see, check references?
[43:07] » We do if we're not familiar with their
work personally. And I think that's the
[43:11] difference here is that with Stonewall,
they have performed work for us in the
[43:15] past.
So, we're familiar with their work.
[43:18] » Next question.
Is there as a public utility, are we
[43:23] required to go with the lowest bidder?
Why do you have a lowest bidder process
[43:29] and are required to get three bids?
>> The The general
[43:32] The general statute states that we're
required to award the contract to the
[43:37] lowest
responsive responsible bidder.
[43:42] And so, the responsive part is did they
complete all of the paperwork
[43:47] appropriately and are they licensed? The
responsible part it gets to
[43:53] are they
capable of performing the project in
[43:58] your best estimation? Um and it's in I
think there's language there about
[44:03] making the award that's in the best
interest of the agency that's providing
[44:07] it. And so, that's why we our
determination was that they were
[44:11] non-responsible based on references and
their price.
[44:15] » And have you ever had that type of
response? Has anybody ever done a
[44:20] perfect project?
>> [laughter]
[44:23] » Probably not.
>> Okay, so I'm I'm just wondering why that
[44:26] one the
this one was particularly um
[44:32] troubling.
>> Based on the reviews and the references
[44:35] that we had, we do not think that it'll
be a successful project. That with the
[44:41] amount of property owners that we'll
have to coordinate with and the amount
[44:45] of places the different properties we'll
have to work um
[44:48] cuz they there's going to be unknown
utilities on these individual
[44:53] properties. The further out of the
right-of-way you get and the smaller the
[44:56] utility lines are, the harder they are
to locate.
[45:00] Each one of these houses a lot of these
houses will probably you know they'll
[45:03] have an electrical line. It may be
underground or maybe overhead. They'll
[45:06] have a water service. There'll be a gas
line, probably potentially cable or
[45:11] internet. There's a lot of different
things we'll have to work around and
[45:16] the history that I have from the
references I've got is that um they're I
[45:21] would expect a lot of utility hits and
that's just more impacts for our
[45:25] customers when we're on their
properties.
[45:27] » Okay, just from experience so the
utilities come out and mark the lines. I
[45:31] mean even the cable people come out and
mark all the lines before they come in
[45:35] and even put in Google you get three or
four different lines. So,
[45:39] why would that be trouble for a
contractor rather than for a homeowner?
[45:43] Are you thinking that the homeowners
aren't going to cooperate? But that's
[45:46] not
>> Um well, we we don't know yet if all the
[45:50] homeowners will cooperate with us or
not. Um we're still working on that
[45:53] getting their permission to be on the
properties to be able to do these.
[45:57] Um as far as utilities that say like a
irrigation line. If somebody has
[46:01] irrigation in their yard, that's not a
public utility that somebody marks. So,
[46:06] it's up to the homeowners to do it or
either the contractor has to kind of
[46:09] look and figure out what it is and where
it is.
[46:12] But, that's that's my concern is is
working on the all these different areas
[46:17] with each individual property owner. If
we're going to have issue a lot of
[46:21] issues and it's difficult to get those
resolved, it's going to take a lot of
[46:25] our staff time and it's going to it it's
not going to be a positive situation for
[46:30] our customers.
>> Okay, so I want to go right back to back
[46:33] to the question I asked about the lowest
bidder.
[46:35] » Mhm.
>> So, it's a hearsay thing really about
[46:38] whether or not you think they can do the
work
[46:41] at the price that they quoted.
And if they can't do it at the price
[46:45] that they quoted and they quoted you the
price, but they're going to do it at
[46:48] that price, why is that a problem?
>> Well, if the problem is
[46:54] in my experience, if a contractor has
underbid a project, then they'll either
[46:59] look to cut corners to get it done as
cheaply as possible or there'll be
[47:04] issues with change orders coming in
trying to add cost to it.
[47:09] And there's things we we don't want this
to be a project where
[47:13] maybe the line is done, but it's not
restored the way we want it, the way the
[47:17] property owner wants it.
It's just it's it'll take a lot of it's
[47:21] it's
much more effort from both the
[47:23] homeowners and from Owasso staff to make
sure the project is completed
[47:26] appropriately.
>> Okay, so if what a person that overbid
[47:30] and is overcharging you is not a
problem.
[47:33] » I don't I don't know that and they're
the the second bid was also below the
[47:37] engineer's estimate.
>> Okay, thank you. Let's go to Todd.
[47:41] » Yeah, I think one thing that would have
been helpful in this is to have that um
[47:46] actual engineer's estimate like right up
front. Um so, the other bid is 25% under
[47:54] uh the engineer's estimate. So, and
mean, was kind of responding to you like
[47:59] it's it's already lower than the the
engineer's estimate.
[48:02] » Yeah, I I
my my reaction is I look at this and
[48:07] how often do you have bids that are less
than half of the engineer's estimate?
[48:16] » Not not too often.
It it it may happen occasionally. You
[48:20] usually we have the other problem is
that they're coming higher than the
[48:23] engineer's estimate.
>> So, that I I remember when we first
[48:26] started talking about this project um
I think it was the estimate was
[48:34] around this is going to cost probably
$10,000 a property minimum. So, I do I
[48:39] do the math on
um
[48:43] the DEDC's bid and it's like $8,000 a
property um something like that. So,
[48:50] yeah, I I I'm very confused as to how
that could actually
[48:54] work at that price.
[48:58] That's that's the perspective I have.
>> Cool. Any other questions before we move
[49:02] into comments and board discussion?
[49:08] Pedro.
>> Yes. Um
[49:11] I would like to know if when you spoke
Mr. Bailey, when you spoke with the town
[49:17] of Chapel Hill, did they provide
documentation or or was it verbally it
[49:22] was coming verbally?
>> Yes, sir.
[49:25] » Okay.
Um so, did were you or were you supposed
[49:30] to contact Mr. Woods, is that
the last name?
[49:35] to conform or or or see or if the
information that it was given to you was
[49:41] accurate or did you
try to clarify that with them with the
[49:45] company or him?
>> No, I did not contact Mr. Woods with
[49:49] those specifics. Um that was in initial
conversations. It's somewhat
[49:54] confidential with the town staff and
getting their opinions on those. Um, and
[50:00] so no, but I did not request
documentation from them or email chains.
[50:04] Um, there are partners that we work
with. Um, but it's also based off of our
[50:08] own staff's
um,
[50:11] observations from in the field as well.
>> So, you also had people from the inside
[50:17] of Wasatch that provided
>> Yes.
[50:20] » information.
>> Yes.
[50:21] » That lead you to believe that?
>> Yes.
[50:27] » Um,
>> I would
[50:28] » Go ahead.
>> Wouldn't you think that it was
[50:31] probably important to see more
documentation from the town?
[50:37] » It's I'm
A lot of times it's not the town I'm not
[50:41] sure what documentation they may have
some email chains.
[50:45] But they're not typically grading the
contractors like putting together a
[50:49] reference material. Typically is not I
mean, I don't even think we do that
[50:54] typically now. Great at so it's it's
sometimes there's not a tremendous
[50:58] amount of documentation on that.
>> The the the next question that I have if
[51:05] we have a situation like this
is there a was it proper for the board
[51:10] to know or have some discussion about
this
[51:14] uh, items or the before we
we uh,
[51:18] do a contract with that
another company. Would it be proper to
[51:25] talk to the board before
in a situation like this to
[51:30] » Let me answer the question before
>> Okay.
[51:32] » for the board staff. No, that's not the
process that we have followed previously
[51:38] or or necessarily would make sense to
follow at this point because of the
[51:43] bidding process that we go through with
the sealed bids being delivered being
[51:47] opened and then they're analyzed by the
staff. So, just just the way the
[51:50] protocol works. This is the This is the
moment when we have to make a decision.
[51:55] » Okay.
>> Yes, ma'am.
[51:57] » My concern, following up with what he
was saying, is influencing the decision
[52:01] process is is important for us to know
if others outside of Owosso are
[52:06] influencing the decision process on who
gets the award.
[52:10] » And I'm not going to disagree with you.
I was just going to suggest
[52:12] » Cuz that seems to be what happened here.
>> We move that to the discussion section.
[52:15] » Oh, okay. Well, I thought we were
talking.
[52:17] » I'm with you.
>> [laughter]
[52:19] » Um this is still questions central to
the um proposal. Judy.
[52:24] » Thank you for the clarification. Um that
was going to be my next question. Is
[52:29] what was the uh um engineer's estimate?
And the second bidder, Stonewall, is it?
[52:35] » Yes.
>> Uh is is still below is 25% below.
[52:38] » Yes, ma'am.
>> Okay. So,
[52:41] I believe
that you've done your due diligence. I
[52:45] believe that's your role, and you've
done what you're supposed to do to to
[52:48] verify and validate who we're going to
select. So,
[52:53] um
I and and you have worked with this this
[52:56] the other bidder, the higher bidder, and
it's still below. So, I think our role
[53:01] is to
>> Is this still a public discussion?
[53:03] » What's that?
>> Is that a question?
[53:04] » I'm going to ask a question.
>> Okay.
[53:06] » Somewhere in there.
>> [laughter]
[53:09] » Okay. Your Honor,
I I will get there.
[53:13] Okay.
Um
[53:16] So, I thank you for doing your due
diligence. This is very difficult for
[53:20] you to come before us and to present
this because there's a conflict. Um I
[53:26] I'm respectful of your role and the due
diligence you've done. I think you've
[53:30] verified, and so given I think that we
have to go with your I'm going to be in
[53:35] favor of your suggestion. And my
question is
[53:40] » I'm waiting.
>> Okay. Because I can't ask if you can
[53:42] negotiate it.
Do you feel that their bid they can
[53:46] deliver
on the higher bidder can deliver at the
[53:50] rate without coming back with change
orders? I got there.
[53:54] » Yes, ma'am.
>> Okay.
[53:57] Thank you.
>> Thank you for your questions.
[54:01] » Mr. Chair, I think Mr. Karen's light is
on.
[54:05] » You can go first if you want.
>> I want to know if change orders are
[54:09] allowed in a contract.
And if it is, why is there a problem
[54:13] with that?
If it's not, it should be specified in
[54:17] the contract and there should not be any
work orders change of work orders. So,
[54:23] is it allowed?
>> Yes, but they have to have First of all,
[54:27] you have to enter into a contract. What
you're doing tonight is approving
[54:32] entering into the contract. Then the
work has to begin. In the course of the
[54:37] work, sometimes unanticipated
circumstances
[54:42] or conditions are encountered
that require work that was not specified
[54:47] or additional work than that specified
in the contract. When that happens, the
[54:52] contractor notifies the project owner
and says, "Look, we have found
[54:57] this. It's going to require extra work.
Our calculation is we'd be entitled to
[55:02] this much extra compensation." And
there's a negotiation about what pay for
[55:07] that change order bid.
There's only a change order because
[55:11] there's
discovered along way a change of
[55:14] circumstance.
It's
[55:16] You shouldn't
uh
[55:19] I don't I hope you will not conclude
from what you've heard so far tonight
[55:23] that a change order is something that is
anticipated from the time you sign the
[55:29] contract. It is not.
Your Your duty tonight as the board is
[55:34] to determine whether or not the board's
recommendation
[55:38] is appropriate and if so, then to
approve the execution of the contract.
[55:43] Uh the board has determined that the
has has made a recommendation to you
[55:50] about the lowest
responsive responsible bidder.
[55:56] Responsive and responsible are judgments
ordinarily made in the professional
[56:01] judgment of the staff of the engineering
department. It's usually done in
[56:06] accordance with the uh
the recommendation of the project
[56:12] engineer, that is the consulting
engineer.
[56:15] And [clears throat] uh one of the things
I've been listening to hear is for you
[56:18] to be told uh what the project
engineer's recommendation was in this
[56:22] case.
>> If there's a follow-up to Peter, can we
[56:25] save that for discussion?
>> Of course.
[56:27] » Sorry that I went on and on.
>> No, it's
[56:29] » Thank you. Thank you both.
>> Um I had a question, I think, going back
[56:33] to what Todd had mentioned earlier. Is
there anything after the bids are opened
[56:37] to prevent you from publishing the
engineer's estimate?
[56:41] » You know, no, there's not. I don't think
so.
[56:44] » Okay, and in a situation where there is
negative feedback about a contractor, is
[56:50] is there any reason we can't provide
that feedback before it's made public in
[56:56] material such as these? It might affect
reputation moving forward.
[57:01] » Um as far as the providing the
engineer's estimate to
[57:05] » And and feedback on what areas of
underperformance you are worried about?
[57:12] » Um we could we could have more
discussions with the contractor with
[57:16] that.
>> Okay, those are my questions.
[57:19] » Cool.
Should we go to the door?
[57:22] » Yeah, I mean, again, I don't know when
the opportunity if we want to dig into
[57:26] this, but as I'm looking at the two
bids,
[57:29] um
the origin
[57:32] » Is that a question? Oh, this is a
question.
[57:34] So like how much does a pitcher filter
and replacement cartridges cost?
[57:41] » Um
>> Cuz one of them says it's $145 and the
[57:45] other says it's a thousand and there's a
hundred of those. So that's the
[57:49] difference of a hundred thousand dollars
versus fifteen thousand dollars. And you
[57:53] see a lot of these.
So I guess I'm
[57:56] it seems like
you know
[58:00] I I don't know how much they cost.
[58:03] » [laughter]
>> I don't I don't know the answer to that
[58:06] exactly what they cost. Um but I do know
that probably the bigger more than the
[58:11] cost of the material is probably the
labor if we're providing those.
[58:17] » [clears throat]
>> I think there was a certain time frame
[58:18] where we had to provide them
the length of time.
[58:22] » So I mean a lot of these you know it's
it's valves or
[58:27] there's one line access not provided.
Okay.
[58:30] » [snorts]
>> Do you know access not provided?
[58:33] » That is if we schedule the way I
remember the contract being written that
[58:37] if we if a homeowner has agreed to allow
a replacement to happen
[58:43] it gets scheduled
and then when the contractor
[58:46] [clears throat] shows up to do the work
the homeowner either no shows or then
[58:51] changes their mind and say nope you
can't do it. It's it's somewhat like a
[58:54] scheduling fee but it's basically a way
of
[58:57] trying to build we tried to build some
line items in here to take out some of
[59:02] the unknowns for the contractor if
things changed if we could because some
[59:06] of a lot of the
some of the access is outside of a
[59:09] Wasa's control.
[59:15] » Mr. Bender are you good?
>> Uh yeah.
[59:21] » Any other
further qualifying questions before we
[59:25] We'll on?
See if we can get public comment and
[59:29] engage in a board discussion.
Seeing none.
[59:33] Any further comments from the public?
Seeing none, we're now going to close
[59:39] that period and enter into board
discussion.
[59:45] And
I got to look at my notes.
[59:49] We're going to go around the table and
I'll recognize members as we can. If
[59:54] there is a follow-up questions,
perhaps we'll ask the chair to um
[1:00:00] uh the chair will ask somebody to come
back to answer it. So, let's open up for
[1:00:04] discussion.
[1:00:07] Anybody want to go first?
[1:00:10] » I
[1:00:12] I'm looking at the process that it was
being done when they were investigating
[1:00:17] Mr. Woods.
I do not agree that
[1:00:22] the best procedure was being done
because
[1:00:26] one, they did not ask the town of
Chaparral for documents.
[1:00:31] So,
I don't think that that should be done
[1:00:36] that way. I think it should be more
um
[1:00:39] investigated.
Uh in my opinion because um
[1:00:45] it was taken their word
uh
[1:00:49] to
to null
[1:00:52] a contract.
And um
[1:00:57] even though there was some
some uh comments from the inside of
[1:01:02] WASA, I think the exterior
uh comments were not being supported. I
[1:01:07] don't know if
what uh documents we have from the
[1:01:11] interior from
inside of WASA,
[1:01:14] but from the outside, I think it wasn't
done properly and I
[1:01:20] I I wouldn't recommend to follow up this
the same procedure for the for the
[1:01:26] future. I think we need to do more
investigation when we award a contract.
[1:01:33] » Thank you, Pedro. Can I move on to Mr.
Bender?
[1:01:35] » What level of evidence? What what's
>> Documentation, pictures, documents that
[1:01:40] proves that the person that is
submitting their bid is not qualified
[1:01:45] and and the reasons why because if the
if the town is saying that they
[1:01:50] he didn't fulfill his word,
then they should have documents. And if
[1:01:55] they don't have documents, I think it
should not be allowed to
[1:02:00] to proceed those comments if they
wouldn't support it.
[1:02:04] » So, there's one the pavement repair of
the sex evasion is since failed and
[1:02:10] today town staff has not been successful
at getting uh the repair
[1:02:15] to repair the the failed pave pavement
to the town's requirements. It seems
[1:02:20] like that should be something that's
>> It should be documented and it should be
[1:02:26] some proofs that whatever the town says
is true.
[1:02:31] For for us to to adopt it, their
testimony it should be documented.
[1:02:38] » Okay.
I think we understand that position,
[1:02:41] yes, Tony.
>> So, I mean regardless of any of the past
[1:02:45] performance,
um
[1:02:50] You know, you
you try to get something repaired and
[1:02:53] somebody gives you a bid for
half of what you say you know it's going
[1:02:59] to cost.
>> Or expect.
[1:03:01] » Is it half?
>> It's less than half. It's 46% of the
[1:03:07] engineer's estimate.
So, I I'm coming at this from how could
[1:03:13] this possibly be? We're seeing
order of magnitude difference in
[1:03:19] estimates.
And again, this is rolling together
[1:03:21] labor and actual materials, but you
know, one person is saying this is going
[1:03:27] to be you know, this is a $1,600 valve
and the other is saying this is $250.
[1:03:33] So,
>> Um
[1:03:36] » Who's inflated?
>> Which line is it?
[1:03:39] » Uh this is line G pressure pressure
reducing valve, for example.
[1:03:44] » Can I I
>> Can I go to uh Elmira? Did you have a
[1:03:48] comment?
>> Just [snorts] a simple uh I guess uh
[1:03:52] comment about how you evaluate
>> [snorts]
[1:03:57] » the quality of the proposal
and not investigating the other people
[1:04:01] cuz you just give them a pass because
you know them.
[1:04:04] » Mhm.
>> Is inappropriate when it comes to
[1:04:06] comparing
uh bids on a project. You look at the
[1:04:10] project for what it's worth. The people
are qualified to do the work and
[1:04:13] everybody's qualified to look at what
they offer. Rather than unless you were
[1:04:18] going to investigate everybody that put
in a bid to see whether or not their
[1:04:22] work is quality, then why are you going
to investigate one? That's the concern
[1:04:27] that I have about it.
So, and and to take
[1:04:33] and I'm going to call it hearsay
following up on what Pedro said because
[1:04:37] unless you see the documentation, it is
hearsay. To a point where in any project
[1:04:43] and any any construction, people have
change orders all the time. If a project
[1:04:47] is completed to the satisfaction of the
town of Chapel Hill or any other town or
[1:04:51] any other project, if it's completed to
the satisfaction of the people that you
[1:04:55] contracted with, whatever change orders
that took place and whatever it cost, if
[1:04:59] the contractor completed it, then they
completed it. End of story to me. I
[1:05:04] don't have to go and investigate how
many hours it took them to complete it
[1:05:08] when I when they completed it when I
asked them to complete it. So, that's
[1:05:11] what I thought we doing here was trying
to get this project completed and done
[1:05:14] at the least amount at the least cost.
If that's not what we're doing and we
[1:05:19] can just give a contract to anybody, we
shouldn't have a low bid process. We
[1:05:22] should just give it to who that whomever
we choose to give it to.
[1:05:26] Based upon whatever
evidence that we are it's not an
[1:05:31] evidentiary process. So, clearly it's a
hearsay and who I like to give it to or
[1:05:35] who I want to give it to cuz everybody's
got friends.
[1:05:39] » [clears throat]
>> Thank you very much for the perspective.
[1:05:41] Going to call on somebody that hasn't
spoken yet.
[1:05:44] Susan?
>> Sure. Um
[1:05:48] the I
as I follow through you know, as I as I
[1:05:52] follow the steps on this, I I I can have
um I have sympathy for all parties. Um
[1:05:58] uh
our staff has looked at the taken the
[1:06:00] bids. The even the highest of the two
bids is still below what the engineer
[1:06:06] estimate is. The low bid looks too low
to be a
[1:06:11] um
perhaps a correct bid or an an adequate
[1:06:15] um
uh understanding of the project. Uh so,
[1:06:19] I'm just kind of walking through the the
process that if if I had been in in um
[1:06:23] Mr. Bailey's position, I would be
looking at. I think that um so, I
[1:06:27] understand how he got and so, he checked
has anybody else worked with these
[1:06:31] people and got some feedback. Um I think
that where I feel like
[1:06:38] some
perhaps something was missing in this
[1:06:41] process was the conversation is then
looping back to um to bid package number
[1:06:47] two and talking with them about why am I
seeing some discrepancies that are very
[1:06:51] different from what we got from our
engineers regardless of what this is. Um
[1:06:57] I I'm bothered. I'm not sure that my
thoughts are very organized here. Um I'm
[1:07:02] bothered that we're having this
discussion in public because of the um
[1:07:07] because of the damage that it
can be doing to to reputations. And so
[1:07:13] I'm I'm very bothered that this is a
public conversation.
[1:07:18] But [clears throat] I also understand
the desire for answers about why
[1:07:21] why the lowest bid was not awarded. So I
I'm struggling with this a bit.
[1:07:26] And
I I think that I mean I have some
[1:07:30] questions as as Todd has pointed out
about the discrepancy on these items. Um
[1:07:37] on some of them being very significant.
Miscellaneous concrete.
[1:07:46] 100 cubic yards at 900 100 cubic yards
at 245.
[1:07:52] Concrete is a commodity. It shouldn't
have that much of a difference in
[1:07:57] in in the cost in the cost difference.
So I have a bunch of questions, but I
[1:08:01] don't have the technical background to
be able to interpret them. So that's
[1:08:04] where we depend on our staff
to be able to do that. So I'm I'm
[1:08:08] rambling a little bit right now. I'm
>> All good.
[1:08:10] » So I will sum it up by saying
I understand how staff why staff is
[1:08:16] making this recommendation. I am
concerned at
[1:08:23] I'm concerned that that an opportunity a
conversation didn't happen with this
[1:08:27] lowest bidder to find out why
his bid was so out of
[1:08:33] out of sync with what was expected.
>> Okay.
[1:08:38] » [clears throat]
>> Chair, can I call on you?
[1:08:40] » Yes.
I think with some of the communication
[1:08:45] failures here, it's important for us to
take a period of time to repair the
[1:08:49] communications. And so I I feel like
what would be really important and
[1:08:52] helpful for us to see is the comparison
of this with the actual engineer's
[1:08:56] estimate and commentary on the
discrepancies.
[1:09:01] And I also think that we are not here
just to make a decision about this
[1:09:05] contract today, but how is Owasso best
served by nurturing good relationships
[1:09:10] with contractors in the future? Um
and to that end, I think it's important
[1:09:14] to provide a little bit of mentoring and
feedback when things don't meet
[1:09:18] expectations and um
really repair that communication so that
[1:09:23] this isn't the end of the road. So that
there is, you know, if something came up
[1:09:26] short here and it doesn't work out this
time that there are future opportunities
[1:09:30] to work together and collaborate. Um so
that's that's my
[1:09:34] position.
>> Thank you very much.
[1:09:36] Judy, turn your phone off, please.
[1:09:39] » I believe uh that it is up to the staff
to
[1:09:45] assess each bid.
On all levels, both responsible uh and
[1:09:51] price and uh
reputation or, you know, for having done
[1:09:55] other work. And in this case, um
um Owasso is familiar with the work of
[1:10:01] the higher bidder.
Number one. So, my main
[1:10:06] that this point is that I think sta-
it's up to staff to look at the bids and
[1:10:10] make a decision. And it is our job to
rely upon the assessment of staff.
[1:10:17] Unless we have, you know, it being out
of whack what the bids are, that's not
[1:10:21] my job. My I've done this stuff before
as a developer and as a person who's
[1:10:27] done bids. It's up to staff to go
through this. But they they went through
[1:10:31] the legal process.
I believe that Steve did his due
[1:10:37] diligence. I don't think you have to
write it down. I don't think people like
[1:10:41] writing it down who work for governments
uh and and towns and you don't want to
[1:10:46] hurt anything and put it in writing. I
think it's more damaging.
[1:10:50] Mr. Woods probably repaired everything
and did everything right and concluded
[1:10:54] the job. But how much stress was it in
the estimation of the town's people? And
[1:11:00] that I think that's what Steve's trying
to
[1:11:03] assess. How much grief is this going to
be?
[1:11:08] That's the first point. I think he did
his due diligence. I think he's made his
[1:11:12] assessment and I think he prefers the
other company because he has experience
[1:11:18] with successful work from them. And that
was one of the questions, the first
[1:11:22] question I asked. Have we worked with
them? Has it been successful? Were we
[1:11:26] satisfied? And his answer was yes. Mr.
Woods is new to this process and hasn't
[1:11:31] worked with the Wassa. Hopefully he will
in the future and he'll be open to other
[1:11:35] bids. We're not here to hurt his
reputation. He's come and he's presented
[1:11:41] a contra information saying that's not
accurate and we've heard that and we
[1:11:45] respect that. But you also have to take
into account that the bid is so low.
[1:11:50] It's less than half
of the bid by the
[1:11:55] engineer
what they thought it would cost.
[1:11:59] » [clears throat]
>> The second thing is um
[1:12:01] uh
that it's the regardless of the details
[1:12:06] in the bid, that's up to staff. I'm I'm
for awarding this
[1:12:11] this to be two things. To be awarding to
as as our staff has recommended with
[1:12:17] recommendations on future processes that
uh which I don't know. Do we allow
[1:12:23] somebody who's bid to come in and sit
down with the Steve and say, "Okay, tell
[1:12:27] me about this." Do we allow that
process?
[1:12:30] » I suggest that's a great thought. And
that maybe we hold that
[1:12:34] » Well, I'm I'm I'm sharing it with staff
now as a potential policy. You would
[1:12:39] mention this. There needs to be
communication. It can't be just blind
[1:12:42] bidding. Here's a thing because you want
to know that you're going to meet if
[1:12:46] you're bidding, you want to meet the the
needs of the company that you're going
[1:12:49] to work for that you're going to
contract with. That's what I would do.
[1:12:54] But in anyway, in conclusion, I think we
need to trust staff to do what's
[1:12:59] appropriate. I don't think change orders
are part of this unless something
[1:13:03] unusual happens. And you're going out to
people's 90 yards. You don't in yards,
[1:13:09] you don't know what you're going to find
when you dig underneath.
[1:13:12] Okay? So, I'm in in these bids there's
always contingencies. And then if it
[1:13:17] goes beyond contingencies, that's where
you get into change orders. I think our
[1:13:21] job is to decide
um whether we support Steve's
[1:13:26] recommendation and the process or not.
And I think he's done his job.
[1:13:31] » Thank you.
So, what I'd like to do is um before we
[1:13:34] have a chance to uh um
>> to share?
[1:13:36] » Say again?
>> I think you you haven't had a chance. Do
[1:13:38] you want to share?
>> You.
[1:13:39] » Well, I was going to share when I wrap
up the discussion I heard from everybody
[1:13:43] else.
>> Okay.
[1:13:44] » But that's okay. Um I'm all right.
>> You're it.
[1:13:47] » Okay. I mean, do we have to make a
decision tonight? Can we take this until
[1:13:51] we get more information or get more
analysis done?
[1:13:56] » Um yes, we have to make a decision
tonight. Um all I guess let's leave that
[1:14:00] open for um
a motion.
[1:14:04] And so, what I'd like to do now is just
kind of following um
[1:14:07] the protocol is to wrap up the
discussion, just kind of repeat what I
[1:14:10] heard from everybody, and then ask for a
motion from the floor.
[1:14:16] So, I've I've heard a a variety of
opinions.
[1:14:20] Um
and a couple of them resonate with me.
[1:14:24] Um I understand the And I And y'all,
I've been part of the bidding process
[1:14:29] for decades.
And I've seen um situations just like
[1:14:33] this.
And it's a tricky project.
[1:14:36] And unfortunately, we only had two bids.
And so, you know,
[1:14:41] on staff's part, you know, they followed
a protocol that I've seen done before.
[1:14:46] Um um
to one comment you noted on
[1:14:50] Todd about the pavement repair,
you know, one of the
[1:14:54] homework we might have us done on that
is whether that was in the warranty
[1:14:57] period or not.
And the extent to which that was part of
[1:15:01] the scope that uh should have been done.
I know that's pretty tricky from having
[1:15:05] done a lot of it. And
you know, Pedro to to your comments and
[1:15:11] others about the equity and the way the
homework was done,
[1:15:16] you know, I think those are valid
comments. So, I'm not
[1:15:19] going to stake out a position until
[snorts] um
[1:15:23] until we call for a motion. And after
the motion, we can have a discussion
[1:15:28] about the motion. There can be
amendments to it. But that's what I'd
[1:15:31] like to do next.
And we just need to move this on. So,
[1:15:37] would anybody like to make a motion?
>> I mean, we accept Steve's
[1:15:40] recommendation. Steve Valley's
recommendation.
[1:15:43] » Great. Is there a second?
I hear a second from Mr. Van Doorn.
[1:15:49] So, [snorts] all in favor of that
>> Discussion. Discussion.
[1:15:53] » Say again?
>> Discussion.
[1:15:54] » Oh.
>> Any additional discussion?
[1:15:56] » I appreciate that. That's why I
made the motion.
[1:15:59] » Sorry.
>> No, no, no. I need help here.
[1:16:01] Any additional discussion?
>> Oh, Mr. Voter, I have to go. I'm sorry.
[1:16:06] But you keep on with the discussion.
>> Can you stay to vote here now?
[1:16:13] » I can't. But
I don't want to rush the voting.
[1:16:18] So.
[1:16:21] » All right.
>> Because I really have I have to go.
[1:16:23] » So, is there any further discussion?
>> Um sorry, what is the alternative if we
[1:16:29] » The alternative would be an amendment or
to not vote for it.
[1:16:33] » And what would happen if we don't vote
for it?
[1:16:35] » Then we would have another motion
to decide what to do next.
[1:16:41] » Do we wait?
>> Do we table it? Do we
[1:16:46] » Do you have to have five votes for this?
>> I believe if I look at the counselor,
[1:16:51] he would affirm that we have five votes.
>> I I'd like to make a motion, but I need
[1:16:57] to wait until after we vote on the first
motion.
[1:16:59] » Okay, yes, that would be correct.
>> [clears throat]
[1:17:03] » All right, we have a motion and a
second. It would be time to vote.
[1:17:07] All in favor of the motion,
raise your hands and say I.
[1:17:14] There's three. The motion four. The
motion does not pass. The four were
[1:17:19] Judy,
Michael,
[1:17:22] Todd,
>> and Susanna. And Susanna. Four. So, the
[1:17:25] motion does not pass.
Would you like to make an alternate
[1:17:29] motion, Karen?
>> Yes, I would motion that we come back at
[1:17:32] the next boarding board meeting with um
complete information that was requested
[1:17:37] tonight and um decide at that time.
>> I second that.
[1:17:42] » All in favor Oh, any more discussion?
[1:17:49] All in favor of the second motion to
bring it back at the next meeting with
[1:17:55] additional information that we discussed
tonight and wanted to look for.
[1:17:59] Um all in favor of that motion, say I.
>> I.
[1:18:02] » I.
That was one, two,
[1:18:06] three, four, five.
>> It's actually six. One, two, three,
[1:18:11] four, five, six.
>> Oh, sorry. I missed your hand.
[1:18:14] Six. Thank you, Susanna.
>> Thank you, sir.
[1:18:17] » The motion passed.
>> Thank you, Mr. Chair.
[1:18:20] » Sure. Thank you, all.
>> Is uh
[1:18:24] Pedro excused so that his vote is not
counted as yes on any further business
[1:18:29] what tonight?
>> Pedro, yeah.
[1:18:32] » Pedro,
if you want your vote not to be counted
[1:18:36] as yes on anything else that happens
tonight. You should you should ask to be
[1:18:39] excused.
And I think the board is willing to
[1:18:42] excuse you, but
>> May I be excused?
[1:18:45] » [laughter]
>> May be excused. And we do not have
[1:18:47] another item
>> I I I motion that Pedro be excused.
[1:18:52] » All in favor, say aye.
>> Aye.
[1:18:54] » Aye.
>> See you, Pedro.
[1:18:55] » Good night.
>> Good night.
[1:18:58] » We're going to move on now to our
discussion to general item.
[1:19:01] It's going to be a review of our
financial management policy by Mr.
[1:19:06] Steven Winters.
Provided 20-minute overview.
[1:19:11] » [snorts]
>> Jesus.
[1:19:11] » Thank you, Steven.
>> Maybe I can do it even faster than that.
[1:19:15] » In advance.
>> Thank you.
[1:19:17] » Hi, everyone. So, um as you know, we've
got a financial management policy and uh
[1:19:24] that
Sorry.
[1:19:27] Um
And it includes performance measures
[1:19:30] that help us stay financially stable and
um and sustainable. And each year, when
[1:19:35] we develop our budget, we take into
account these financial measurements and
[1:19:39] we typically design our budget to be to
where we meet these these uh
[1:19:44] objectives.
At one of our budget work sessions, you
[1:19:47] all asked us to uh
um
[1:19:51] to to
have a discussion with you all about
[1:19:54] what if we change some of the parameters
of the uh
[1:19:58] of the performance objectives. So, how
would that impact the rates that we
[1:20:01] charge our customers? How would it
impact our
[1:20:04] uh ability to borrow, you know, all of
that sort of stuff. So, tonight I'm
[1:20:08] going to go through the what the
performance measures are.
[1:20:11] Uh and then at our next meeting, we'll
come back and talk about, you know, if
[1:20:15] we change them, what the impacts of
those might be. Um and if there's
[1:20:19] anything
you know, as we go through tonight,
[1:20:22] please feel free to interrupt with the
questions if you have them. Um but if
[1:20:25] there's anything that we go through
tonight and you think, "Hey, I'd really
[1:20:28] like to see
you you model a changing this thing, you
[1:20:32] know, we'd I'd be happy to take that
into account.
[1:20:35] So, um the financial management policy
is available on our website. Anybody can
[1:20:41] access it. It's also included in the
budget. We call it a budget book, the
[1:20:46] document that that you all have I'm sure
you've seen and it's on the website as
[1:20:49] well. The policy was last
modified in 2012.
[1:20:54] Um
no prejudice in that. There's there's
[1:20:58] been no reason to change it. I'm not
saying anything, but that previous
[1:21:01] boards have been derelict.
So, um there's nine performance
[1:21:06] measures. The first three have to do
with our reserve funds.
[1:21:10] The first is our working capital reserve
and these are all defined in the policy.
[1:21:17] The balance in the working capital
reserve should be the greater of either
[1:21:21] a third of our operating budget
or 20% of the next 3 years CIP budget,
[1:21:27] whichever's higher.
Um you know what our CIP budget is. It's
[1:21:32] definitely the next 3 years, 20% of the
succeeding 3 years CIP currently is
[1:21:36] higher than a third of our operating
budget.
[1:21:39] Um and so for fiscal year 2027, the
budget is um for this reserve is 32
[1:21:46] million. The purpose of it is uh you
know, it's kind of like a savings
[1:21:50] account if you um
you know, it's it's meant to be able to
[1:21:54] cover your operating expenses in case
something bad happens, you know, we
[1:21:59] don't not getting revenue or you got
expenses that went way up or pandemic
[1:22:03] happened, uh things like that.
The second reserve is a capital
[1:22:08] improvements reserve and it is um
the the calculation on that is it's 2%
[1:22:14] of depreciated capital assets. Our
depreciated capital assets are in the
[1:22:19] hundreds of millions and for fiscal year
27, the balance in that account um is
[1:22:24] budgeted to be 6.9 million.
The purpose of this reserve is if we
[1:22:29] have um
you know, a big oops. Um a few years
[1:22:33] ago, probably 10, we had a project in
the CIP to inspect our the dam uh
[1:22:40] gates out at Cane Creek. And we're we're
just going to like uh do some
[1:22:44] maintenance on them, oil them or
something. I don't remember exactly
[1:22:46] what, but when they did the work, they
noticed there was a problem and it was a
[1:22:49] million-dollar problem. We didn't have
to dip into the
[1:22:52] fiscal reserve then, but that's kind of
the purpose of it.
[1:22:56] For things like that. And we've had And
you you uh Rogerson Drive pump station
[1:23:00] was before you all, but that was a
$7 million uh an
[1:23:05] uh an emergency happened that we had to
deal with right away. So, these are the
[1:23:08] kinds of things that
that that reserve's for. The final one
[1:23:11] is called a rate revenue stabilization
reserve. Um it's to be 5% of our
[1:23:18] budgeted annual water and wastewater
revenue for fiscal year '27. That's $3
[1:23:23] million.
And it's intended to provide uh cash
[1:23:27] flow when
either
[1:23:30] expenses are higher or revenues lower
than than what we had uh anticipated.
[1:23:35] Um and this is the purpose of this one
is to is to allow some flexibility if uh
[1:23:41] so you don't have to raise rates in the
middle of the year, you know, it so you
[1:23:44] so you're not running that that tight.
There is some overlap in these in this
[1:23:49] particular set of policies. It's
probably obvious that between working
[1:23:53] capital and rate revenue stabilization.
So, without any of you asking, uh when I
[1:23:57] come back next month, we'll we'll have
some information or some analysis around
[1:24:01] this this this subject.
>> I have a question.
[1:24:05] » Yes.
>> So, in this scenario, the minimum
[1:24:10] balance is
32 million plus 6.9 million plus 3
[1:24:15] million.
>> Yeah, about What's that? 42 41 42
[1:24:19] million.
>> 42 million. Okay, thank you. So, they're
[1:24:22] all
So, it's belt two belts and suspenders.
[1:24:27] » I wouldn't characterize that way.
>> [laughter]
[1:24:31] [snorts]
>> Okay.
[1:24:32] » Uh
>> [clears throat]
[1:24:33] » Yeah.
>> All right, thank you. So, all of all of
[1:24:37] these things would have to go wrong.
>> For us to spend We'd have to
[1:24:41] » For us to use all of that that's in
reserve. All of them would have to go
[1:24:45] wrong in the same year.
>> Well,
[1:24:47] um
you know, you you
[1:24:51] Let's say that happened.
If it did, we we'd have zero balance in
[1:24:56] our reserves, and so for the next
several years we we'd be looking to
[1:25:00] build that back up. So, you know, you
really wouldn't you wouldn't it's not
[1:25:04] reasonable to anticipate that all would
go wrong, right? It's that this is the
[1:25:08] level of cash based on this, you know,
set of
[1:25:12] formulas that you would need to be able
to be prepared to deal with all these
[1:25:15] things.
>> Okay.
[1:25:16] All right, thank you.
>> You're welcome.
[1:25:19] Uh the next five of the performance
measures have to do with debt
[1:25:23] management. Um you know, debt is a
um
[1:25:28] a necessary thing, especially in a
business like ours. I think I've said
[1:25:32] this to you before, but we
you know, we're about to invest in a in
[1:25:36] an asset over at the Clearwell that
hopefully is going to last another 100
[1:25:38] years.
Um it that wouldn't make sense to pay
[1:25:42] cash for that and burden today's
rate payers with all that money. And
[1:25:45] that's you know, that you could carry
that philosophy to other examples.
[1:25:50] Um the first one on this in this bucket
is the debt service coverage ratio, and
[1:25:56] I
would submit that this is the most
[1:25:58] critical one.
The way it's calculated is it the we
[1:26:02] need to have
in net income twice what our debt
[1:26:06] service is.
So, you may recall that our budget for
[1:26:09] fiscal year 27 in debt service is 12 and
1/2 million. This means this means that
[1:26:15] our net income
revenue less operating expenses, should
[1:26:19] be 25 million.
Um and just to remind everyone, you
[1:26:22] know, off who I'm talking about income,
OASIS is a nonprofit, so what that that
[1:26:27] money that's left over after paying
operating expenses is used to fund
[1:26:31] capital improvements programs, debt
service, and uh to replenish reserves to
[1:26:35] the extent that's needed.
And the purpose of this one is just to
[1:26:39] make sure you have enough cash to be
able to pay your
[1:26:41] pay your principal interest on debt.
The next one um is debt serve debt
[1:26:47] burden to asset value, and it says that
our amount of debt should be no more
[1:26:53] than uh half of our depreciable assets
for fiscal year 27, we're at 30%, so
[1:26:58] we're you know, we're comfortably under
that limit, and this measures our debt
[1:27:02] capacity. So, theoretically, you know,
we could borrow uh more than we're
[1:27:06] borrowing now.
That would increase our debt service,
[1:27:10] which would affect that first uh issue.
Happy to explain that if that's not
[1:27:14] clear.
[1:27:17] Um the next is sufficiency of revenues
above debt requirements. This says our
[1:27:22] debt service should be no more than 35%
of our revenues, and again, we're
[1:27:26] comfortably under that, and this is
another one that's just meant
[1:27:30] for us to to make sure that we've got
enough cash to pay our debt service.
[1:27:34] Uh this one is cash financing of
capital.
[1:27:38] Over a 5-year period, this this policy
means that we'll pay at least 30% of our
[1:27:43] CIP
uh expenditures with cash. In other
[1:27:46] words, you won't borrow more than 70%.
Uh and this is just to prevent us from
[1:27:51] becoming too overburdened with debt.
And then finally, our credit ratings.
[1:27:55] The the uh policy in
uh says we should have no
[1:28:00] less than eight the
the uh
[1:28:05] ratings that are listed there, AA2, AA+,
and AA+ from three rating agencies,
[1:28:10] Moody's, Fitch, and Standard & Poor's.
We're actually slightly better than that
[1:28:14] um in two of the with two of the the
rating agencies. And this is measures
[1:28:18] credit worth- worthiness. It affects how
popular your bonds are when you go to
[1:28:22] sell them. It impacts your um the amount
of interest that you pay, but admittedly
[1:28:29] going from an AA
one to an AA2 wouldn't have a big impact
[1:28:33] on our interest rates.
[1:28:37] The final
um
[1:28:41] performance measurement has to do with
our service affordability. We talked
[1:28:44] about this in one of our budget
meetings. Karen, you may remember asking
[1:28:46] some questions about this.
The um
[1:28:50] the the
formula in our policy mirrors what kind
[1:28:55] of the industry average is for the
affordability ratio.
[1:28:58] And it's a measure of what is how how
big a percent of the median household
[1:29:03] income is our annual water and sewer
bill.
[1:29:07] So, for our policy,
if you take a year's worth of our water
[1:29:11] and sewer bills, they ought not be one
and a half per- more than one and a half
[1:29:14] percent of median household income.
So, currently, based on the
[1:29:19] budget you all just passed recently,
these are the projected
[1:29:23] um for service affordability ratios when
comparing the average bill to median
[1:29:29] household income. You know, we're
slightly above it in 2027. We get a
[1:29:32] little bit further away as we go go out
further.
[1:29:36] A few years ago,
the board asked us to start tracking
[1:29:40] instead of average bill, what's the
median bill?
[1:29:44] And so, as the but that's not what the
policy said. This is just something you
[1:29:48] all wanted us, you know, to to use.
So, um
[1:29:53] if you use the median bill compared to
median household income, you know, it's
[1:29:56] a lot less percentage of of household
income.
[1:30:00] We might feel good about this because
we're Either way, we're either almost
[1:30:04] meeting it or meeting it. Um but 20% of
our
[1:30:09] fellow residents in this community make
$25,000 a year or less.
[1:30:14] So,
uh
[1:30:16] the percentage of their annual income,
you know, our bill is a much higher
[1:30:20] percent. In fact, um it's above 5%.
So, it doesn't make sense
[1:30:27] and it's not feasible for us to lower
our rates for everyone in the community
[1:30:32] low enough to make it affordable for
folks that are having a hard time paying
[1:30:35] it. They don't, you know, make enough
money to
[1:30:38] uh
to completely pay their water bills. And
[1:30:40] this is why we have the Care to Share
program, which helps people, you know,
[1:30:44] pay their bills. And which is why we're
also
[1:30:47] uh pursuing a sustained
uh
[1:30:51] customer assistance program. The Care to
Share is meant to cover kind of an
[1:30:54] episode episode. Like, if I
am without a paycheck for a few months
[1:30:58] for whatever reason or have a big
medical bill, then this is meant to help
[1:31:02] Look, here's some money that that uh
that can help out.
[1:31:06] Folks that are in this lower category
here, um it's our opinion that they need
[1:31:10] more sustained assistance. They need
help with their bill every month, not
[1:31:14] just once every now and again. So,
again, that's why we've gone to the
[1:31:16] towns to to look for money.
Uh you know, for support for the
[1:31:21] program.
[1:31:23] So,
um just to summarize, you know, I think
[1:31:27] our
our uh policy has served us well, kept
[1:31:30] us financially sound, in good shape. Um
I know people are always asking
[1:31:35] [clears throat] about debt, but I can
assure you we're um you know, not
[1:31:39] overextended.
Uh
[1:31:41] our We have really good bond ratings.
Our financial condition is well. And we
[1:31:45] we uh our bonds are usually very popular
in the market. And, you know, the terms
[1:31:49] of those are usually good. So, again, at
our next meeting, we'll talk about what
[1:31:53] some changes to any of these might mean.
Back to you for questions.
[1:31:58] » Thank you.
[1:32:01] My next question would be, are there any
public comments?
[1:32:05] Seeing none.
[1:32:08] So now we're going to facilitate a board
discussion. There's no motion for
[1:32:11] tonight.
And so I'd like to just go around the
[1:32:15] room and
have a discussion.
[1:32:17] » I have some more questions.
>> What questions?
[1:32:21] » Yeah.
>> Of course.
[1:32:22] » Sorry.
>> Excuse me.
[1:32:24] The next
set would be
[1:32:27] clarifying questions.
>> Yes. Uh
[1:32:28] » Thank you.
>> Thank you very much for the
[1:32:30] presentation. That's helpful. It's good
context. Um [snorts]
[1:32:33] I am
uh
[1:32:36] as you know, I I was looking forward to
this because I feel like we have a um
[1:32:41] the
the root of some of this is with the the
[1:32:44] projected uh
the projected increases over the next 8
[1:32:48] or 10 years that um
complying with these policies um
[1:32:53] necessitate and that is related to the
the large capital projects that we have.
[1:33:00] Um
to your
[1:33:03] was this when the when these policies
were created
[1:33:08] had OWASA seen any uh large projects oh
I'm curious, you know, it's the it's the
[1:33:16] clearwell, the hundred million dollar
clearwell that we're trying to pay for
[1:33:18] now. That's an 80-year
lifespan or the last one was 80 years.
[1:33:22] So this next one we hope will be another
80-year project. Um and it's kind of I
[1:33:28] think of it as like the um
the boa the boa constrictor that
[1:33:33] swallows the elephant. It's a big lump.
Um and has lots of kind of but sorry,
[1:33:38] setting up my question is this. Has
there ever been an expenditure as large
[1:33:43] as this that these that these financial
policies have been applied to?
[1:33:50] » Um I think this policy was original
originally adopted in 2010 and I don't
[1:33:56] know what was in place before then. I
think there probably was something it
[1:33:59] just wasn't this.
>> When was the Cane Creek waste water
[1:34:03] done?
>> Earlier than that, in the '80s.
[1:34:05] » Okay.
>> But there was a
[1:34:07] » Sorry.
>> There was a big project down at the
[1:34:09] waste water plant when it was expanded.
It was like $50 million. I don't
[1:34:13] remember
maybe somebody else will whether that
[1:34:15] was before or after 2010.
Before.
[1:34:20] So I
I think the answer to your question is
[1:34:22] probably no.
>> Okay. Because that's where my question
[1:34:25] is coming from is that are we applying
policies that were created for normal
[1:34:31] circumstances and this is an abnormal
circumstance.
[1:34:35] » So
first of all, the first thing I want to
[1:34:37] say is I think it's a good idea to to
take a look at these policies every now
[1:34:41] and then and
previous boards have talked about it but
[1:34:45] we for whatever reason haven't done it.
Um but I would argue that having a $100
[1:34:50] million
you know, facing a $100 million project
[1:34:54] is exactly why
we need these these policies. Or or you
[1:34:58] know, I'm not necessarily have to be
exactly this, it can change.
[1:35:01] Um but it's to be able to we're we're in
the
[1:35:05] one reason we're in the position we are
now to be able to deal with this is
[1:35:08] I think because of adherence to policies
like this.
[1:35:14] » Okay. Let's go to the
we'll get back to questions.
[1:35:17] » Sure.
>> Oh, sorry.
[1:35:20] No, I I have a follow-up question.
>> All right.
[1:35:24] » The um
If [clears throat] you could go back on
[1:35:26] your on your screen to the
debt coverage ratio and the bond
[1:35:31] ratings.
>> Yeah.
[1:35:33] » Yeah. What are the requirements of the
bond agencies for debt coverage ratio?
[1:35:38] » Um it
Well, it depends on what rating you
[1:35:41] want. Um
but generally for the ratings that we're
[1:35:44] in, somewhere between
Oh, I'm sorry. Bond debt service
[1:35:48] coverage or I was getting ready to say
cash cash on hand. Um what we have about
[1:35:52] two.
>> Really? Cuz the information that's been
[1:35:55] in our packets is 1.4.
Or not in our packet, I have seen
[1:35:59] elsewhere 1.4 referenced as the
um, debt coverage ratio for public
[1:36:04] utilities.
>> That may be an average, I don't know.
[1:36:09] Um,
>> I
[1:36:10] it would be helpful to know that
information.
[1:36:13] » What? The average? Or like what the
typical?
[1:36:16] » more have more references to what the
debt coverage ratio requirements are.
[1:36:21] » Okay.
>> Um,
[1:36:23] » would it
>> But
[1:36:25] » Go ahead, sorry.
>> Just it's the information that I've seen
[1:36:29] elsewhere is that it's
significantly below the 2.0.
[1:36:34] » Could could we maybe Could I ask for
some structure to this whole thing? So,
[1:36:39] what I would like to see,
um,
[1:36:42] when we have a broader discussion on
this,
[1:36:45] is I'd love to know
one,
[1:36:48] what are the actual legal requirements
for any of these?
[1:36:53] Two, what are peers doing?
Um,
[1:36:59] and then three,
uh, to what extent are we seeing
[1:37:05] overlap?
Um, if you go to the previous slide, all
[1:37:09] of these different buffer funds,
um,
[1:37:13] » Oh, oh, oh, the previous slide.
>> I I I look at the
[1:37:17] Is it
Did you want to go there?
[1:37:19] » Yeah.
[1:37:23] Um, I I kind of look at this and it's
it's like the the adage, you know, have
[1:37:28] uh,
is it six months of emergency funds?
[1:37:31] And it's like, want to have six years.
It seems to me like even the example
[1:37:37] that you gave where there was an
emergency, we didn't even use the fund.
[1:37:41] Now, I'm
absolutely for having large emergency
[1:37:46] funds, but $42 million in around money.
Um what I would love to understand is
[1:37:53] what are the costs of having this as
cash essentially
[1:37:59] relative to having it I don't know in
other investment vehicles or spending it
[1:38:05] on you know,
but what are the what are the ultimate
[1:38:08] impacts of this level of working capital
relative to
[1:38:14] um
rates.
[1:38:17] Um
the
[1:38:21] I I I think that would be very handy to
understand.
[1:38:25] Um
So, that's maybe number four. And number
[1:38:28] five, how long does it take to borrow
money?
[1:38:34] » 6 months or so.
>> 6 months. Okay.
[1:38:37] Um
I'm curious as to like
[1:38:41] you know, a lot of the
[1:38:44] you know, the uh
capital improvement line here. So, um
[1:38:49] so, unplanned CIP expenditures
I don't know what kind of like
[1:38:55] time horizon that concerns, right? So,
this is stuff that would be planned and
[1:39:00] implemented immediately.
Um
[1:39:04] is that specifically for what would be
planned and implemented immediately?
[1:39:08] » Yeah, it these they'd be like stuff
that's not in the CIP plan or it's in
[1:39:12] the CIP plan years years from now
something like that, yeah.
[1:39:15] » Okay.
It'd
[1:39:17] be useful to see when these have been
used or what they
[1:39:23] like situations where they would be
used.
[1:39:26] » Okay.
[1:39:30] Can I go to Elmar?
Thank you.
[1:39:33] There's
couple of things I can respond to you
[1:39:36] real quick. So, I don't have to
uh
[1:39:39] hold you up with the answers to that. Uh
there there is no we don't have any
[1:39:44] legal debt limits. Towns do, we don't.
Um, the
[1:39:49] regarding the debt service coverage
ratio,
[1:39:52] our policy says what it says, 2.0.
Um, it says we could go down to 1 and
[1:39:58] 1/2 if unusual circumstances and we've
done that recently in in your tenure.
[1:40:03] Um, and then our bond order is probably
the closest thing to a legal uh,
[1:40:07] commitment that we have and it says it
needs to be 1.2. And that's pretty
[1:40:13] bare bones. I I you
I don't know how many people we feel
[1:40:16] comfortable operating there. But anyway,
that's
[1:40:20] the legal. And now, I don't know you
said something about your uh,
[1:40:23] the peers, so I'll have to look that up.
>> Sure. Just to understand
[1:40:29] like
are these right down the middle and
[1:40:33] these still totally make sense or is
this like
[1:40:36] you know, we're the only ones doing
this. They're so
[1:40:40] » Yeah.
[1:40:43] Yes, ma'am.
>> Elmira.
[1:40:44] » Okay. Thank you very much.
>> Your report is the one I understand the
[1:40:48] most. So, thank you very much for
keeping up with the state financial
[1:40:53] standards of the industry.
I did want to know, first of all, simple
[1:40:57] question. Who's giving us the AAA?
>> Um,
[1:41:01] Standard & Poor's.
>> Oh, okay. That's pretty
[1:41:04] » [laughter]
>> Uh,
[1:41:06] another one is the money the working
capital that you have that's sitting
[1:41:11] there
is invested, right?
[1:41:14] Uh, what do you got it in? Money What do
you got it in?
[1:41:17] » We're very limited in what we can invest
in. It's in something called a North
[1:41:21] Carolina Capital Management Trust and
then we're around around 3%. 3%.
[1:41:28] » I didn't even hear what you said.
>> No. Okay, so it's in the North Carolina
[1:41:32] Trust.
>> Yeah.
[1:41:35] » Yes,
we are limited to that today.
[1:41:38] » Um
>> not limited.
[1:41:40] It has to be at a bank that's and it's
got to be fully collateralized with cash
[1:41:44] and if there's just just some banking
weird banking stuff that we have to
[1:41:48] » Because of the Republic Utility
>> Yeah, we can't invest in
[1:41:52] » Korea Korea
>> AI stocks and that kind of thing.
[1:41:54] » [laughter]
>> Well, we don't want them, but okay.
[1:41:58] Thank you. That's That's all I had.
That's all I just wanted to know what we
[1:42:01] were doing.
Thank you.
[1:42:03] » You're welcome.
>> Here are the changes we're going to do.
[1:42:05] » Okay, go ahead.
[1:42:09] » [clears throat]
[1:42:12] » Uh in in addition to considering um
the policy whether it should be 1.2,
[1:42:19] 1.3, 4, 5, you know,
um how conservative it it should be to
[1:42:25] have this cash.
If we don't have the cash,
[1:42:30] uh if we then we either lower rates or
spending it on more capital improvements
[1:42:35] and we have this unique circumstance now
this $100 million clearwell. So, in
[1:42:40] setting the new policy when we have our
full conversation, I guess it's next
[1:42:44] month and we really look at all this
stuff.
[1:42:47] How much do we borrow on that? Our
conversation the other day when I had my
[1:42:50] orientation with you um the state has a
fund that we may be able to borrow
[1:42:57] against at no interest.
>> Or the
[1:42:59] » We may not be a good candidate for that
cuz a lot of people going to want some
[1:43:02] of that money.
Um is that right? You know.
[1:43:05] » Yeah.
>> And and so we're going to go out for a
[1:43:07] bond issue for anywhere up to $100
million.
[1:43:12] If that's the whatever the figure is Is
that the figure on clearwell?
[1:43:15] » Yes, but but we're only allowed to
borrow $50 million of that under the
[1:43:19] current policy.
>> Now, um if it was just that one project,
[1:43:23] we could have we could have our 70.
>> Uh-huh.
[1:43:25] » We could do what?
>> 70
[1:43:27] under the current
>> So, that that is I'm bringing that into
[1:43:30] the mix as to what we need to consider
in the policy. I don't have an opinion
[1:43:35] yet.
I'm I'm totally open to learning about
[1:43:39] this because, you know, the trade-off,
you know, do you keep more cash
[1:43:43] or do you borrow more money? And the And
you indicated the current rate for bonds
[1:43:47] at about 3.2%.
And is it a 30-year, 40-year, you know,
[1:43:53] how long is the bond, etc. And do you
You obviously need to keep cash reserves
[1:43:57] for that.
Um
[1:44:00] in regular business and in
commercial business,
[1:44:04] at those rates, you want to borrow as
much money as you can cuz that's like
[1:44:07] free money. Zero is free money and 3.2
is very, very low, as well.
[1:44:13] » It's 3 and 1/2 to 4, but
>> Oh, it's up. Okay. Um so, whatever it
[1:44:18] is. And then but in with a public
utility when you're dealing with, you've
[1:44:22] got to You've got to [clears throat]
pay. That would be if we borrowed 100%
[1:44:26] of it.
If that were our policy to borrow 100%
[1:44:29] of it, we'd be paying 3.2 million or 4
million a year interest on the bonds,
[1:44:36] correct?
Whatever the bond rate was, that's be
[1:44:40] our annual and we'd certainly have to
have those cash reserves. What's the
[1:44:44] trade-off? How does it affect the rate
payer? How does it affect the rates or
[1:44:50] the raising of the rates? And if those
are the things we're talking about, that
[1:44:54] financial planners, and they all They
have all kinds of formulas. So, I'd like
[1:44:58] to see as much of that how much because
it will help in establishing our policy.
[1:45:04] Do we not borrow enough? In other words,
if it's very low interest, let's borrow
[1:45:09] all we can. Um if it's I mean, that's
that's an assumption. And if it's higher
[1:45:16] interest, you know, we borrow less
because we have to service less. And all
[1:45:20] of that is How does it affect the rates?
How does it affect your reserves? Do you
[1:45:25] need all of that on reserve, you know,
in case of all of that happening at
[1:45:30] once? And I think that Is that not what
our consideration is?
[1:45:35] » that's where we're going on the
September 10th
[1:45:36] » Yeah, and I'm glad we're now considering
this. I You know, I've heard about this
[1:45:40] since I came that you know, the one the
first meeting I was at was at one point
[1:45:44] you know, it's one we keep
>> [clears throat]
[1:45:46] » really high. What are we at two?
At two point 2.0?
[1:45:52] » Yes. Yeah.
>> Um
[1:45:54] And so there's room, do we want to
uh have a policy to make more room?
[1:45:59] » Let's hold that to September 10th.
>> Okay. Okay, so I am sharing the
[1:46:04] conversation I had with Steven that you
the other day on all these issues for
[1:46:09] consideration.
>> That's great.
[1:46:11] Um go ahead, Steven.
>> Yeah, two quick points I'm I keep
[1:46:14] thinking of these things that someone
else has asked that I want to get to.
[1:46:18] Um first of all, and I know we talked
about this the other day, we don't we
[1:46:22] don't and we can't borrow for working
capital. It's got to be secured by a a
[1:46:27] capital improvements program.
or project. Um so that could affect I
[1:46:32] said six months. If you got everything
lined up ready to go, it takes six
[1:46:35] months.
A lot of times it depends on where
[1:46:39] projects are in the bid process and how
many do you have and can you can you
[1:46:42] bundle enough with 100 million it's not
a problem, but a lot of times we're
[1:46:46] bundling up several different projects
to make a bond issue. So that can affect
[1:46:50] the timing as also.
[1:46:53] » You know, go ahead, Karen.
>> Um
[1:46:57] it sounds like we're kind of opening up
the discussion to how do we want to
[1:47:01] benchmark ourselves in the future? And
when I think about benchmarking, you can
[1:47:04] compare yourself to your past
performance, you can compare yourself to
[1:47:07] others, and you can compare yourself to
an ideal scenario that you would like to
[1:47:11] have in the future. Um so I think
what we may not be as aware of here for
[1:47:16] context is the comparison to others. Um
and so I am curious if AWWA or IB Net
[1:47:23] might have numbers on
these specific indicators or indicators
[1:47:27] that are similar that would give us a
little bit of context to how others see
[1:47:31] it.
>> Yeah.
[1:47:31] » They might and and I was I was meant to
ask something earlier and I was afraid I
[1:47:34] was interrupting.
Um so another way to get at this is to
[1:47:39] talk to the rating agencies and and you
know, they'll tell you
[1:47:44] for a rating of this, this is what you
need to have and I've got some of that
[1:47:48] information from previous discussions
that we have. So I don't know if that
[1:47:51] would be helpful or if you know, cuz
[clears throat]
[1:47:54] peer comparisons can be a little tricky,
you know, maybe somebody else has a
[1:47:59] lower rate, but their financial
condition is is not what we would want
[1:48:02] or there's something about their system
or where they are in the process.
[1:48:06] I'm happy to get it. I'm just posing the
question.
[1:48:09] » Is that a
>> I just have so many questions about how
[1:48:12] these things
ripple,
[1:48:15] » [clears throat]
>> you know, how they one one affects you
[1:48:17] turn you turn a knob and you move a
lever and multiple things can happen. If
[1:48:21] you do both or one or the other,
different things happen. Um
[1:48:26] I'm thinking about things like
as
[1:48:30] as this
[1:48:33] given the parameters that we have that
we are growing our budget significantly
[1:48:38] so that we can eat this great big
swallow this big elephant that is the
[1:48:42] hundred million dollar
uh
[1:48:46] clear water critical infrastructure
uh piece of equipment that's going to
[1:48:50] last 80 years, we hope. Okay, so we're
going through all of these rate
[1:48:54] increases to make this
to be able to swallow this big thing.
[1:48:58] And then once that's done, we've
established rates that are really high
[1:49:04] and we don't have the capital needs
after that.
[1:49:07] » Now, I
>> Or are you expecting that we're going to
[1:49:11] have hundred million dollar projects
moving forward?
[1:49:13] » So I I we do do 15-year financial plan.
So we're looking 15 years out in the
[1:49:18] future and you know, that's a lot of
estimates in there. So, you have to
[1:49:21] consider that. But, um if you look at
the
[1:49:26] I I showed you 10 years in the budget
process and at some point towards the
[1:49:31] end of that 10-year period, we come back
to where we're 3 or 4% 4% I think rate
[1:49:36] increases.
Um when you get into the years 11
[1:49:40] through 15, it's around the 3%. Um so,
you know,
[1:49:46] there are other that that the CIP
pipeline doesn't go away. There's still
[1:49:50] things in there, not $100 million
projects, but um
[1:49:53] it's not a situation where we've raised
rates so high, we're going to be sitting
[1:49:56] on all this cash and we're going to not
know what to do with it or have to lower
[1:50:00] the rates or anything like that. It's
just that's not the way this works.
[1:50:04] » There are also two components here that
Thank you. That that is helpful. And if
[1:50:09] we were to
um
[1:50:13] And we're Well,
we'll get into that later cuz we're
[1:50:16] talking about policy right now. The um
it seems that there are two parts here.
[1:50:21] That there's this these this working
capital or this these reserves that you
[1:50:25] need to have in the bank, okay?
And there's the debt coverage ratio in
[1:50:30] the budget that is um
And I Are those two I'm trying to figure
[1:50:37] out how those two are related to each
>> Sure.
[1:50:39] » Cuz they seem independent to me.
>> No, they're very they're very related.
[1:50:42] And in fact,
the the debt service coverage ratio this
[1:50:46] is not 100% true,
but if you
[1:50:50] hit what your target is there,
almost all these others fall into place.
[1:50:56] Not not always. The reserve sometimes
doesn't doesn't work out, but those
[1:51:00] other ones the other debt ones the fit
you know, no more than this or that for
[1:51:05] these. If you get the debt service
coverage right here,
[1:51:08] you're pretty much going to be okay on
everything else.
[1:51:11] » Our
biggest year ever
[1:51:15] how close were we to the having
to
[1:51:19] take on the a project of this size in
the biggest year ever in your in your
[1:51:24] time here. Have we ever come close to a
hundred million dollar project?
[1:51:27] » Mhm.
No.
[1:51:29] » Okay. And so these these policies have
been applied
[1:51:34] in
uh
[1:51:36] in a world in which we were not taking
on a project of this size.
[1:51:41] » Yes.
But I'd like to add that I
[1:51:45] these numbers are pretty agnostic uh
to stuff like that. I mean
[1:51:50] they they scale up and down, right? So
whether you're
[1:51:54] um
[1:51:57] Let me qualify that a little bit. So a
couple of years last year or year before
[1:52:03] um I recommended that we not meet the
2.0 debt service coverage ratio. I think
[1:52:08] we budgeted it one and a half.
Um because
[1:52:12] everything else looked good, our
reserves looked good and uh
[1:52:17] we were we would have been raising rates
just to meet that debt service coverage
[1:52:21] ratio.
Um
[1:52:24] I'm not sure where I was going with that
I but I just do want to point out, you
[1:52:26] know, it's not something that we've
rigidly or or must rigidly stick to, but
[1:52:30] it was something we need to be smart
about if we want to take an exception.
[1:52:33] » Okay.
I agree.
[1:52:36] The fifth the fifty million dollar
project back in before 2010 is
[1:52:41] comparable almost to I mean it's close
to a hundred million dollar project now,
[1:52:45] but that's before this policy. So, you
know, it's just it's a different price
[1:52:50] tag, but proportionately it was serious.
Yes, and were there financial problems
[1:52:56] that that it
that were created because of that that
[1:52:59] perhaps led to this policy? I because
we're we're looking at this policy in a
[1:53:04] vacuum that it was created in at some
point and
[1:53:07] » I mean these are
I think what you'll find and I'll
[1:53:11] give you some information about it or
they're pretty
[1:53:15] mom and apple pie type things. You know,
you might tweak with a different, you
[1:53:18] know, formulas and all that kind of
stuff, but the elements are pretty
[1:53:22] common.
Um
[1:53:25] There were I mean you're you're you are
mentioning something that did happen
[1:53:30] when
right about before this policy went into
[1:53:33] place and this is where that rate
revenue stabilization fund came from and
[1:53:36] a lot of utilities did that still have
it is that's when people was doing
[1:53:41] conservation. You remember that graph
that I show you guys of
[1:53:44] the water sales when it started heading
down a lot of utilities
[1:53:49] couldn't predict the conservation that
was coming so they were missing their
[1:53:52] revenue targets every year.
So this was one of the reasons
[1:53:56] that these went into place.
>> That was right after the major drought
[1:54:00] of 2007-2008.
>> I remember it.
[1:54:02] » Don't
So maybe I can clarify what I asked for
[1:54:06] before.
I would like to understand
[1:54:13] legal requirements and peers
on
[1:54:18] these figures. Right? What are what are
their like working capital and
[1:54:23] you know, general what what are their
goals? What are their
[1:54:26] Do we have legal requirements on this?
Um and then I would like to understand
[1:54:33] the effect of this working these working
capital goals on rates. So how is this
[1:54:38] affecting our decision making?
>> Okay.
[1:54:40] » Um
[1:54:44] I mean I look at this you know, 20% of
next 3 years uh CIP budget.
[1:54:49] So all of a sudden our CIP budget is
spiked
[1:54:52] quite a bit. I mean so how is that
affecting working capital which is
[1:54:56] affecting rates
>> [snorts]
[1:54:58] » when maybe
like I think that would be very useful.
[1:55:02] Um, I'd also like to understand how
these might overlap.
[1:55:09] I mean again, it's it's the question of
are we being double triple conservative?
[1:55:15] And this cuz all of this money is not
beating inflation. If it's sitting there
[1:55:20] at 3% in this I mean we're losing money
with with this much cash essentially on
[1:55:26] hand, it seems like.
Um, I'm not saying we shouldn't have
[1:55:30] cash. It's just I I I got to ask if it's
wise to have $40 million in the other.
[1:55:36] Um,
and then I guess it's it's
[1:55:40] if we were to change the policies on
this reserve piece,
[1:55:46] how does that then affect
so you know, the the second slide, all
[1:55:51] of these different indicators of that.
I guess um,
[1:55:56] I I don't get a sense of how much these
actual indicators change
[1:56:01] the
board the the policy.
[1:56:04] So like, you know, oh okay, this is
going to be the investment, this is
[1:56:07] going to be the rates. Here's how the
indicators play out.
[1:56:13] » I'm not sure I follow that last.
>> So,
[1:56:16] we're going to have X rate, X borrowing,
and our debt service ratio is Y.
[1:56:25] Okay, we're we're we're allowing it to
go low enough, you know, lower than it
[1:56:29] was in another year. It's a it's a
internal goal.
[1:56:34] The question is are we actually then
changing rates or changing CIP goals in
[1:56:39] service of the metric? I can't remember
the paradox. It's when the metric
[1:56:44] becomes the goal,
>> Yeah.
[1:56:46] » then it's a bad metric.
>> That's what we're doing.
[1:56:49] » And that's I think that's the fear,
right? Is
[1:56:52] um, to what extent are these metrics the
the next slides this metrics, actually
[1:56:57] determining
you know, what gets prioritized, the IP,
[1:57:01] what gets I mean, cuz I think that's the
thing we want to stay away from. I don't
[1:57:05] know if it's implicit or explicit.
>> If I could begin to wrap up
[1:57:10] just uh
and just you know, to the point that um
[1:57:14] suggest we might want to consider moving
on and
[1:57:17] um
and the question would be have you
[1:57:21] gotten enough information at least to
lead us on the temp and the direction to
[1:57:27] answer the questions and Susanna, you
raised your hand.
[1:57:31] » I feel like we're not going to have
um
[1:57:34] I I don't I feel like we've been
presented this information and we're
[1:57:37] going to come back in a month and we're
going to say do we want to keep them the
[1:57:40] same or do we want to move them
different?
[1:57:42] And I feel like we're going to need
information, we're going to need to
[1:57:44] understand scenarios and concept risks
and consequences and all of those things
[1:57:49] in order to know whether anything and
and benefits as well, whether these are
[1:57:53] worth reconsidering.
Um without without
[1:57:58] turning the knobs and moving the levers,
we don't know whether there's any
[1:58:02] benefit to changing the policy or what
the risks might be or how that affects
[1:58:07] the rates and that's the whole reason
we're having this conversation to begin
[1:58:10] with.
>> Sure.
[1:58:11] » So
>> What can I make one comment?
[1:58:13] » Sure.
>> This is the industry standard across
[1:58:17] not just public utilities but across
government.
[1:58:20] The stuff that he's presenting with
regard to with these rates at the end of
[1:58:24] the reserves is industry standard. It
doesn't have to be a public utility, the
[1:58:28] university has the same similar
standards as far as reserves and so does
[1:58:32] most other public organizations.
>> [clears throat]
[1:58:35] » I mean, it's just normal it's bi- it's
just business as usual. This is not
[1:58:39] exceptional.
That's probably why they got voted in
[1:58:43] years back. People have I'm just saying,
it's just industry standard.
[1:58:47] » Do we know that?
>> I know it, he knows it and you can
[1:58:50] probably look it up in the financial
planning book and try the same thing
[1:58:53] out.
>> So, if I could come back to your point
[1:58:56] since if
>> I'm just saying.
[1:58:58] » What Yeah, I hear you. And I think we
all do. So, what what how would we get
[1:59:03] to where you want where we need to be?
With your thought process. Todd, and and
[1:59:09] I'm not trying to
diss you. I'm just trying to say how do
[1:59:13] we
How do we get to where you guys want to
[1:59:15] be?
>> Well, I guess I I'm asking for the for
[1:59:17] information. Um it's basically since
>> sensitivity analysis.
[1:59:21] » Yeah, it's what I It was what I would
love to see.
[1:59:22] » And then I think if we get that and I
don't know before the next meeting, then
[1:59:27] then we'd have the information to make
decisions.
[1:59:29] » Well, that's helpful.
>> I I agree. That's That's exactly what it
[1:59:33] what where it comes from. It's that
well, let's say
[1:59:37] And again, each of them are different
components to it, but if if you go to a
[1:59:41] 1.4, if you aim for a 1.4 as your
standard debt coverage ratio, what does
[1:59:47] that do to the you know
>> looking for models, financial models.
[1:59:52] » Yeah, sensitivity analysis.
>> I'll put it in the models.
[1:59:54] » Yes.
>> [laughter]
[1:59:55] » Yes, exactly.
>> Which is a lot of work, but it we need
[1:59:58] to have the input and some assumptions
made.
[2:00:02] That which is modeling.
>> Yeah, so my [clears throat] plan was to
[2:00:06] come back next time with
may not meet your expectations, but with
[2:00:12] attempting to meet those expectations.
Sitting here tonight and having this
[2:00:16] conversation, I've become a little
skeptical that it can be done in
[2:00:19] one meeting, next meeting, but um let's
get as far as we can and see what
[2:00:24] questions remain.
>> Would there be an opportunity that you
[2:00:28] could provide us requested some
information to consume
[2:00:33] for the board to consume before the next
meeting?
[2:00:35] » Um well, you'll for sure have it in the
as in the a week ahead in the budget
[2:00:40] package. And if I can get some stuff
together beforehand, I don't I sure
[2:00:43] don't mind sharing it. I
I Sitting right here, I'm not sure
[2:00:48] I can promise that but
>> Okay.
[2:00:52] Board?
[2:00:56] » Can I have Can I have a show of hands
that we can
[2:00:59] » Oh, I just want to move on to the next
item. I wanted to make a comment
[2:01:03] if I may shift Mr. Chairman.
See, in taking from for staff to take a
[2:01:10] look if we spent more money on capital
improvements to in preventative
[2:01:16] maintenance, how much longer could we
keep some of the equipment going and all
[2:01:20] those kind of things is in part of the
planning. And so do we want to increase
[2:01:25] capital improvements every year?
I have you know cuz
[2:01:29] constantly need work.
So it's it in the modeling that
[2:01:36] It's okay.
In the modeling, I mean well that's a
[2:01:38] consideration for me. Um
you know, you keep stuff pieced together
[2:01:43] but this is an old system that has been
>> And that's what our capital improvement
[2:01:47] plan takes into account for.
>> Right.
[2:01:50] » That that our staff has done a
remarkable job in in in evaluating and
[2:01:55] planning out the capital improvement
plan over time. I don't think anyone is
[2:02:00] questioning that.
>> Okay.
[2:02:01] » The what we're asking about what I'm
asking about what I hope others are
[2:02:05] considering is whether
given the circumstances that we have
[2:02:10] with this large this large 80-year
project
[2:02:15] project coming on board whether it is
worth making an exception to these
[2:02:21] policies or changing these policies so
that it has a lesser impact on our
[2:02:26] ratepayers.
>> That is the point.
[2:02:29] » Yes. It's not I
that I agree. They have a capital
[2:02:32] improvement plan that that staff has
done a remarkable and and detailed job
[2:02:39] not kicking the can down the road.
>> But they in consideration of that plan,
[2:02:43] they're always using this as the
measurement how far they can go. Would
[2:02:47] they go further if these numbers were
different?
[2:02:51] And that's what the modeling is.
>> Um sorry, I just want to point out I I
[2:02:56] think we're unfortunately going to be
losing you at the end of the year with
[2:02:59] your retirement. And so um
it may not be the best timing to go to
[2:03:04] sort of a very technical um fancy
solution um at this point. So I'd love
[2:03:09] to just hear your perspective on that at
the next meeting, too, on whether you
[2:03:13] think any proposed changes are going to
be
[2:03:16] sustainable and recommended given the
staff transition as well.
[2:03:19] » You mean right now do I think that?
>> You don't have to answer now.
[2:03:22] » Um well, I think that there's um
some duplication in the reserve area and
[2:03:29] I would
you know
[2:03:32] I think it's worth taking a look at,
yes.
[2:03:34] Um
[2:03:37] So
>> I don't anticipate anti- uh being
[2:03:41] uh in favor of making drastic changes,
but um
[2:03:45] tweaks, yeah, I think I think that's
possible and and could be warranted.
[2:03:48] » Thank you.
>> Let me see if we can have a show of
[2:03:51] hands about moving on to the next item,
please.
[2:03:57] Thank you.
>> I had so much more to say.
[2:04:00] » [laughter]
[2:04:03] » All right, team. Thank you very much.
Um
[2:04:08] we're [clears throat] going to do a
section where uh Mr. Taylor is going to
[2:04:10] review the board work schedule.
>> Yes.
[2:04:13] » Request.
>> Yes.
[2:04:18] What happened to number two?
>> Is it time for requests?
[2:04:21] » Is it time for what?
>> Requests.
[2:04:23] » No.
>> Yes.
[2:04:24] » What happened to number two?
>> Requests from board members.
[2:04:27] » Okay.
Um
[2:04:30] » The policy review is not happening.
>> Excuse me.
[2:04:36] I'm sorry, Joe. Picking it up in my
ears. Say again.
[2:04:40] » 82
>> Thank you, Mr. Woods.
[2:04:44] » That was the bid process.
You're already there.
[2:04:50] » [snorts]
[2:04:56] » We're on F1, correct?
>> We are on
[2:05:00] on What do you say?
F1 what?
[2:05:03] » Um the board work schedule.
>> Yes.
[2:05:07] Review for
board work schedule.
[2:05:09] » Okay.
Okay, so I would like to formally
[2:05:12] request that the board approve
development of an informational memo by
[2:05:16] the Owasso staff prior to our discussion
and action item that's scheduled for
[2:05:21] September 10th, 2026 titled review draft
developer reimbursement policy.
[2:05:26] And the following winter 2025 the Owasso
board and staff co-developed a memo
[2:05:29] template to be used in future instances
of requests for new or expanded
[2:05:33] services.
The draft policy proposes creating a new
[2:05:36] financial management service to be fully
implemented and overseen by Owasso staff
[2:05:40] as well as levying substantial fees on
newly connected customers moving forward
[2:05:44] to reduce the financial burden on
housing construction companies that
[2:05:48] install new water and sewer pipes in our
area.
[2:05:51] In line with the agreed upon procedure,
I have requested an informational memo
[2:05:54] to accompany the draft developer
reimbursement policy via our internal
[2:05:59] written correspondence on June 4th,
2026.
[2:06:02] No board members raised any objections
at that time. The proposed subheadings
[2:06:07] included alternative approaches, the
overlap with existing policies, examples
[2:06:11] from other locations, estimated
implementation costs and fees, impact
[2:06:16] projection including pros and cons, and
ethical considerations, and a monitoring
[2:06:20] strategy.
Following extensive conversations with
[2:06:23] the Owasso staff, thank you Monica and
Fishman who's not here, um I believe
[2:06:28] that the limited information consisting
of the draft policy itself and the
[2:06:31] endorsements that we've received today
um have been incomplete and balanced and
[2:06:36] potentially misleading in a few of these
categories.
[2:06:39] So, I would briefly remind the board
that we have all sworn an oath to fairly
[2:06:42] represent the interest of current and
future WASA ratepayers when taking
[2:06:45] decisions, and I don't believe that we
can achieve our common value of robust
[2:06:49] and defensible processes to ensure
community confidence in our
[2:06:52] decision-making without having access to
the supporting evidence.
[2:06:56] My request is that the members of the
board make the collective will of the
[2:06:58] board known at this time by verbally
indicating their support or their
[2:07:01] reasons for declining support for the
memo preparation. Thank you for your
[2:07:05] consideration.
[2:07:11] » So, I think you're asking us
to show of hands
[2:07:16] to support what you're proposing.
>> What what are you asking for?
[2:07:20] » I'm asking for the staff to prepare an
informational memo prior to the
[2:07:23] discussion and action item at the next
meeting.
[2:07:29] » That includes
the your
[2:07:33] That sounds like a simple request. The
detail that you've just discussed sounds
[2:07:36] like a lot of information.
>> Yeah. There's some categories in the
[2:07:39] memo just like the other memo templates
that we adopted previously.
[2:07:46] » [clears throat]
>> Can you go through the line items in the
[2:07:49] memo you're requesting?
>> Yes.
[2:07:50] » I think you're I think your request is
fair. I just want to enu- if you
[2:07:54] enumerate what you're asking for.
>> Okay. So, alternative approaches to this
[2:07:59] specific policy. So, this policy um
being compared to other alternatives
[2:08:03] that might be available.
>> Do you Do you know of other
[2:08:06] alternatives? I mean, I'm just asking.
>> Yes. So, alternative could be the status
[2:08:10] quo that there is no new policy. Another
alternative could be a coalition among
[2:08:14] developers that works on creating
private contracts. So, there are several
[2:08:18] other alternatives that need
>> Didn't we vote that we were going to
[2:08:22] have this new policy? That they were
going to work on the reimbursement
[2:08:25] policy, and we were going to We've
already voted I think.
[2:08:28] » No, the vote failed.
>> Oh.
[2:08:29] » Huh?
>> The vote failed.
[2:08:31] » No, the prior vote is to
there was a
[2:08:35] previous vote
that we adopted a reimbursement policy.
[2:08:40] » No, we did not.
>> We didn't adopt the actual policy, but I
[2:08:45] thought we voted on
>> to proceed into draft one. That's what
[2:08:49] we voted on.
>> the the go ahead to staff
[2:08:52] » to draft one.
>> to to redraft it and
[2:08:54] » So, we didn't include in that
alternatives. We just said come up with
[2:08:58] a policy that meets what we passed in
our motion.
[2:09:01] » Yes, so we received a draft policy and
we received endorsements from specific
[2:09:06] people. We haven't received a memo that
analyzes the effects of the policy.
[2:09:14] Do you want me to go through
>> Yeah, go ahead. I'd like to. Thank you.
[2:09:17] » So, alternative approaches, the overlap
with existing policies, so specifically
[2:09:22] um
the excess capacity credit policy that
[2:09:24] we have in place right now.
Uh examples from other locations,
[2:09:29] estimated implementation costs and fees,
the projection of the impacts, the
[2:09:33] magnitude of the impacts including the
pros and the cons, ethical
[2:09:36] considerations, and a monitoring
strategy.
[2:09:39] » See, I thought that's what we discussed.
All of these
[2:09:45] that you're talking about were part of
the conversation should we have a
[2:09:48] reimbursement policy? That was the
initial threshold question I thought.
[2:09:53] And we decided we should if a developer
down the road, you know, was there going
[2:09:58] to be
mechanism for a reimbursement to them.
[2:10:04] Okay, and and I think what we had asked
them to come up with is a is the
[2:10:08] mechanism, but we already approved
prior what failed was their proposed
[2:10:15] mechanism I thought.
I could be very confused. Council, do Do
[2:10:20] what I'm talking about?
>> Yes, I do.
[2:10:22] » Thank you. Somebody does.
>> [laughter]
[2:10:26] » The board has decided
to
[2:10:31] task the staff with coming back with a
reimbursement policy.
[2:10:37] That
that decision by the board
[2:10:40] I think was based on a judgment that
there should be a reimbursement policy.
[2:10:46] The specifics of that policy were were
not set out in that vote.
[2:10:50] » And that's what failed.
>> that's why the
[2:10:55] the staff was tasked with
going out and bringing you back a draft
[2:10:59] reimbursement proposal that would
include the things the staff understood
[2:11:05] the board agreed about.
And the staff has been hard at work on
[2:11:10] that, and there is such a document that
would would come before the board.
[2:11:16] I understand that Karen is asking for
further analysis of the impacts
[2:11:23] and the alternatives
before the board votes on
[2:11:28] the
the draft that the staff has been
[2:11:31] working on.
And
[2:11:33] you know, that more information is
certainly always beneficial. It's up to
[2:11:37] the board as to whether you want to do
that or whether you want to
[2:11:40] proceed to consider the
the
[2:11:44] draft from the staff. I assure you
that in conjunction with general
[2:11:48] counsel, the staff has worked very hard
to come up with a draft that
[2:11:53] incorporates what
I'm going to say we
[2:11:57] understand the board
has said they approved.
[2:12:01] Uh
and with that said, uh I absolutely
[2:12:04] agree that the
things that Karen is asking
[2:12:08] be done further before the board votes
would be helpful to the board's analysis
[2:12:13] of the issue.
Is that fairly stated?
[2:12:17] » So, let me ask staff.
>> Mr. Taylor,
[2:12:21] do you think that's achievable?
>> Not in a month.
[2:12:25] » It
requires considerable research.
[2:12:29] » All right, Mark.
>> How much research are you envisioning?
[2:12:34] » Well, Monica, do you want to speak to
that? I know we've had several
[2:12:37] conversations about
your previous requests.
[2:12:42] That information may not be as readily
available as you would think.
[2:12:48] » So, Monica Dotson, Deputy Executive
Director. Um
[2:12:52] we've done research on similar policies
uh for uh water and sewer utilities and
[2:12:59] we've looked at other towns' policies.
What we haven't done is look at have
[2:13:04] done conversations with them about the
application of it. Um you know, what's
[2:13:09] the success rate of it? You know, have
there any been any other unintended um
[2:13:14] consequences to the policy or again,
what's been the success rate? So, we
[2:13:18] would need to reach out to towns and the
other agencies to get more of that more
[2:13:22] in that information.
Um
[2:13:26] the effects of the policy. So,
for the alternatives analysis, it would
[2:13:30] definitely be helpful
uh
[2:13:33] to understand what other alternatives
that the board's aware of. Um we looked
[2:13:37] at
other ways that the mechanisms that we
[2:13:41] looked at meet the growth pace for
growth principle. So, um if there other
[2:13:46] mechanisms that the board wants to
pursue us or other alternatives that you
[2:13:51] want us to look at within that, we know
we can certainly do that. So, you said
[2:13:53] that sound like you said there's like a
status quo. There's partnerships with
[2:13:58] other developers. I guess maybe when we
do our research, we can we can also see
[2:14:02] if there's other ways that that towns or
cities are accomplishing this, but um we
[2:14:07] weren't readily aware of any other
alternatives. So, to answer the
[2:14:11] question, I think we're going to have to
do more research on uh what other
[2:14:15] alternatives might be out there.
Certainly, do some more extensive
[2:14:19] research with the application of the
policy within
[2:14:22] towns and
and other water and sewer utilities.
[2:14:29] Yeah,
I didn't get all of the things that
[2:14:32] you're looking for in that. So, I think
what what I would want to do is take
[2:14:36] some time to kind of go through that,
better understand if this is something
[2:14:39] the board would like to pursue, what
would the board members want to see out
[2:14:44] of that so then we can give a better
estimate. So,
[2:14:47] based on what I see now, I don't think
we could do it within a month. But, I
[2:14:50] would want to make sure that whatever we
did met all the board members'
[2:14:53] expectations.
>> So, I think
[2:14:56] what we need to do as a board is to
agree to go ahead
[2:15:01] with Harris' proposal
to defer it past the September 10th
[2:15:07] meeting.
>> Yeah.
[2:15:10] » So, again.
>> I'm sorry. I'll wait till you're done.
[2:15:11] I'm going to ask respond to what you're
saying.
[2:15:14] » Okay, great. Um
>> Mr. Chair, normally requests and
[2:15:18] petitions from
board members would follow a process
[2:15:24] where you all decide if
So, it would take five members to decide
[2:15:28] you want to advance that request and
then it's referred to staff to do
[2:15:32] exactly what Monica
suggested, which would be to to try and
[2:15:37] determine how long it would take us to
address the request. So, I think the
[2:15:41] first item is to determine if there is a
majority of the board that wants to
[2:15:47] pursue the request.
>> Exactly where I was going, but thank you
[2:15:50] for saying it better than I did.
Appreciate that. So, that's where I was
[2:15:54] going to go. I was going to suggest now
we have a vote and see
[2:15:59] from the board members that are here
>> Well, there's no second Is this a
[2:16:02] motion?
It's a request.
[2:16:04] » Okay.
>> If If I respond to that, we have
[2:16:08] already, in my opinion, said that we're
going to have a reimbursement policy.
[2:16:13] Considering alternatives or considering
status quo is opposite to what we've
[2:16:18] already agreed to move forward. What And
I think more information is great. I
[2:16:23] don't oppose that. But but
the how expansive it is is making an
[2:16:28] assumption that we would actually
reverse what we have already decided to
[2:16:32] do, which is to create a reimbursement
policy and not maintain the status quo.
[2:16:37] So, I would oppose those portions of it
that you're requesting that are so broad
[2:16:42] to because
we have a development community. Our job
[2:16:48] is to Our job is to represent the
ratepayers, not the developers,
[2:16:53] not the town of Chapel Hill or Carrboro,
the ratepayers in the 22,000 people uh
[2:16:59] uh accounts and the people involved.
That's our job.
[2:17:03] And they're paying a lot of money, and
I've asked the question many times, if
[2:17:08] we have more ratepayers, we certainly
have the capacity, can we uh if we have
[2:17:13] more development, are there more people
to share in these rates and to pay the
[2:17:18] bills? Cuz that's our only source of
money. And we, based on the
[2:17:22] conversation, we passed the threshold
issue. So,
[2:17:28] I think that delaying this is not fair
to the ratepayers, nor to the developers
[2:17:34] who are sitting there wanting to spend
tens of millions of dollars to bring
[2:17:39] utilities. How do they get fairly
reimbursed? How do other towns, other
[2:17:44] communities deal with it? And that was
the mechanism we've asked the staff, and
[2:17:50] we voted on to have the staff pursue for
us. We did when we did the threshold
[2:17:54] issue. So, I'd like to keep that moving
forward. I don't represent developers.
[2:18:00] I am represent taxpayers, and things get
stalled here so long with so much study
[2:18:06] and then looking for counter and
counter. You voted against
[2:18:10] moving forward with any mechanism and
I'm respectful of that. But I don't want
[2:18:15] this
recommendation
[2:18:18] to be a way to stall the process cuz I
don't think that's fair. There were four
[2:18:22] votes for, it would have passed but we
needed five. By September there will be
[2:18:28] five votes is my guess. And it will pass
under some mechanism that's recommended.
[2:18:33] And I'm just saying I I'm for some of
your proposal and others I oppose
[2:18:37] because it's down a rabbit hole we've
already decided not to go.
[2:18:42] » All right.
How many of us would vote to move
[2:18:45] forward with Terrence's recommendation
and allow the staff time to
[2:18:51] do some more research.
I'm likely not meet the September 10th
[2:18:55] deadline and bring it back.
[2:18:59] » [snorts]
>> Show of hands, please.
[2:19:03] » To
What what are we voting on exactly? Like
[2:19:06] the problem is
>> The The request that the staff have
[2:19:08] permission to prepare a memo.
>> Right, but you read off like there's
[2:19:12] like 20 points on the memo.
>> There are not 20 points. There's seven
[2:19:16] subheadings which is similar to the memo
template we've already adopted last
[2:19:20] fall.
>> So so are we talking about all seven of
[2:19:22] those that we're voting on including the
the status quo?
[2:19:27] » Judy has suggested that she does not
want to consider any alternative
[2:19:30] approaches besides this policy or no
policy. She She believes those are the
[2:19:34] only two approaches we need to be
considering.
[2:19:35] » I think we are
>> I think she was not saying that. I think
[2:19:38] she was saying
um
[2:19:40] a pol- this policy or another policy,
but no change in policy has already been
[2:19:44] voted on.
>> What's wrong with asking providing
[2:19:49] clarification? What's the problem?
Oh, there's what's the problem with
[2:19:53] getting clarification?
>> Yeah, none. For a decision for a
[2:19:56] decision that we not have been made
later.
[2:19:58] » Well,
>> cuz that's what she's asking for.
[2:20:00] » I've I've objected to including in that
the status quo or alternatives. We've
[2:20:06] already decided on a policy. So, why
would we
[2:20:09] » We decided to move forward with a
policy. That doesn't mean this specific
[2:20:12] policy is the only policy that could
exist.
[2:20:14] » Well, the we did say we do a
what is it called? A reimbursement
[2:20:19] policy. We voted on a reimbursement
policy, not an alternative and not a
[2:20:23] status quo. A a a moving forward
establishing a mechanism. That is what
[2:20:29] we voted on in my recollection or
maybe my memory's gone.
[2:20:34] » There's no room for this policy to
change at this point.
[2:20:36] » can't No, no, we have no policy as far
as
[2:20:39] what the mechanism is. That's what we've
asked them to do is come back with lots
[2:20:44] of information. What's the mechanism
that is fair that we proposed to the
[2:20:49] developers and they came in with various
things that had to do Did it include
[2:20:53] interest? Did it include a variety of
things? And we looked at it and we said,
[2:20:58] "Go back, you know, talk to all these
stakeholders and come back with a
[2:21:02] mechanism that we can then address and
vote on."
[2:21:07] And so,
an alternative to it that mechanism for
[2:21:11] reimbursement or
status quo having no mechanism is not it
[2:21:17] would be going backwards to asking for
something we've already that isn't on
[2:21:21] the table.
[2:21:24] » There there's no guarantee of approval
of this.
[2:21:27] Though, I I have to point that out. So,
the status quo is a future possibility.
[2:21:31] » I I would say that when we voted for a
mechanism,
[2:21:35] more than five people voted and and we
we know that developers want to put
[2:21:41] infrastructure in at their expense with
a reimbursement policy, a mechanism to
[2:21:46] be reimbursed.
>> Wait, if you believe there's no
[2:21:48] information in the world that exists
that could possibly change your mind
[2:21:51] about what's in that policy.
>> What I know in the world Oh.
[2:21:55] I I don't need to use AI and I know
there's not an alternative or a status
[2:22:00] quo that will work for
putting in infrastructure and
[2:22:03] reimbursing
>> Okay, that's how you feel. That's fine.
[2:22:06] » That's how I feel. Now, the other
>> for the future and that's all
[2:22:09] » No, yeah, and I don't think we we're
reversing That would be reversing it, in
[2:22:13] my opinion.
Those two particular points. The other
[2:22:16] information, let's research it.
>> So, we have
[2:22:20] multiple polar perspectives.
[2:22:24] » I I don't understand
We aren't talking about voting. We're
[2:22:27] talking about getting information.
>> Correct. That informs our ability to
[2:22:32] make a decision.
>> Moving forward
[2:22:34] » Yeah.
>> with the request
[2:22:36] » Yeah.
>> for more information
[2:22:40] to thereby defer
a vote on September 10th.
[2:22:45] So, the
>> What's the rush?
[2:22:47] » I We've
>> I could do it like rappers say, "What's
[2:22:49] the rush?"
>> We've had a single memo
[2:22:51] without any memo informing our
discussion. And I've had to ask for
[2:22:54] hours conversations
questions to Monica over and over
[2:22:58] because we have not had a well-prepared
memo going into a discussion yet.
[2:23:02] » But, they're going to give us one next
>> I would like this not to be wasting my
[2:23:05] time, either.
>> But, okay.
[2:23:08] It is interesting that the people who've
already voted no against having any
[2:23:12] policy are for stalling this and
delaying it. And I think it's a delay
[2:23:17] » accusation, but it's not an attack.
>> I'm actually I spent years studying
[2:23:22] evidence-based policy and I don't think
that's what we're doing here. And and I
[2:23:25] have an issue with it and that's my
ethics and that's my values that I have
[2:23:28] to uphold for myself. So, I don't
appreciate that.
[2:23:30] » And I'm respectful of that.
>> You're not.
[2:23:32] » But, I am saying the two things you said
>> There's a proposal
[2:23:37] uh
before the board and you asked for votes
[2:23:40] and I think people started to vote.
But, uh I suggest that
[2:23:46] arguments at this level are not useful
and that you go ahead and vote and see
[2:23:51] if there five votes for
proceeding
[2:23:56] uh
with Karen Turkquist or not. If they are
[2:23:59] not then the matter is not still on the
table.
[2:24:04] » Let's proceed with the vote.
All in favor of Karen's request, raise
[2:24:09] your hands, please. Say aye.
>> Aye.
[2:24:13] » Three
Three votes for it.
[2:24:15] All opposed, say nay.
[2:24:19] Three votes against. So, Karen, it did
not pass.
[2:24:22] » Mhm.
[2:24:25] » Thank you for suggesting it.
[2:24:27] Pat Taylor is now going to review the
board work schedule.
[2:24:30] » Yes. Uh reflecting back on the board's
earlier discussion about the um
[2:24:36] effective governance training that was
canceled for today
[2:24:40] um and trying to determine
what needs to happen next
[2:24:45] with the August 27th. I would like some
direction
[2:24:49] from the board on whether we're
proceeding with a training on August
[2:24:54] 27th or we pursuing [clears throat]
other dates. And I would remind you all
[2:24:59] that
uh we also have to coordinate those
[2:25:02] dates with the consultant uh to be able
to have their availability as well.
[2:25:10] » I think that if it is important for
these three sessions to happen in order
[2:25:16] that uh you just have to go back to the
drawing board and ask the consultants
[2:25:20] what the next three dates are for
um if they don't have to be in order
[2:25:25] then
you know, the 20 then poll the
[2:25:31] the rest of the board for whether
they're available on the 27th or not. Um
[2:25:36] » Well, we can all we know several board
members will not be available. And the
[2:25:40] requirement for non-board members to be
there is going to present a
[2:25:46] » It's going to be a challenge regardless.
>> That is almost insurmountable.
[2:25:50] » Well, that's what the chair said.
>> I'm sorry, say it again, please.
[2:25:53] » You said it. All nine people had to be
there.
[2:25:56] » I think that I I cannot understand
moving forward with a series like this
[2:26:01] without all nine board members.
>> So, that there isn't a rule?
[2:26:05] » Say again?
>> I said that's the rule then, right? I
[2:26:08] nine nine of nine.
>> I would gently push back on that. I mean
[2:26:11] » Push back?
>> I I'm not going to be on the board after
[2:26:14] a year. So, like I mean we're we're
we're spending months making, you know,
[2:26:18] doing workshops. Like I I'm term limited
out. So, like we're nine board, you're
[2:26:23] going to have a new board eventually.
So, I think it we we could relax that
[2:26:27] requirement. I mean, I can't remember
the last meeting where all nine people
[2:26:30] were here.
>> [laughter]
[2:26:31] » How do you all feel about
>> I think it's unrealistic to to try to
[2:26:36] schedule three events with all nine
board members.
[2:26:40] » Okay.
>> And I think that it that we just need to
[2:26:43] get this we need some training, we need
some materials, and and we need to
[2:26:49] collectively move forward. So, I would
encourage you not to have that as your
[2:26:53] bar.
>> Okay, I would accept the encouragement.
[2:26:56] What's the minimum threshold?
[2:27:00] » Majority rule. I Well, I would
>> [laughter]
[2:27:03] » I would say goal the goal would be
seven.
[2:27:06] Um seven of nine seems like a
a significant amount. The goal would be
[2:27:11] seven.
I'm not saying that's a hard fast rule,
[2:27:15] but um you know, if you get less than
six, then you know, you really are
[2:27:20] dwindling in terms of the ability of the
organization of the of the board to
[2:27:25] to gain knowledge and work together and
learn how to be more productive.
[2:27:29] » Okay,
I I accept that.
[2:27:32] » Oh.
[2:27:35] » So, between the six of us,
we'll set a threshold of
[2:27:42] » [laughter]
>> seven? Six.
[2:27:45] » Right.
[2:27:48] I'm I'm just kidding.
Cuz we could have had the meeting today.
[2:27:52] » Yep.
[2:27:57] » Help me with this and stay on schedule.
>> I I would
[2:27:59] » Seven.
>> Seven.
[2:28:00] » Seven.
>> Aim for seven. And if you can't get
[2:28:03] seven, see if six will I mean, it's just
like with this many people
[2:28:08] » We'll get what we can.
>> You get the most you can. And if it's
[2:28:12] important for those three things to
happen in order, then
[2:28:16] the 27th could be one of the dates
or
[2:28:20] move onward.
>> Okay, can you also video it so that the
[2:28:24] people that miss can go back and see
what happened?
[2:28:27] » I think the material I don't know. I
don't know. I I was
[2:28:30] » If If you really care about them
learning it,
[2:28:33] why not video and let them see?
>> I would defer that to others. I wouldn't
[2:28:37] make that
>> I would say participation
[2:28:39] would be
critical in the actual conversations
[2:28:44] rather than just observing.
>> But some knowledge is better than none.
[2:28:48] » [laughter]
>> I mean, it wouldn't be a bad idea to
[2:28:49] have it videoed if we could, just even
for memory.
[2:28:52] » We can do that.
>> So, Todd, I think we have marching
[2:28:56] orders.
>> So, August 27th,
[2:28:59] we will see if we have seven board
members available for that date and then
[2:29:05] go from there.
>> The 27th of August.
[2:29:08] » Yes.
>> Yeah, I'm trying to be Fs.
[2:29:11] » [laughter]
>> Just kidding.
[2:29:14] » Thanks.
>> Um September 10th, we do have uh quite a
[2:29:19] quite a lengthy agenda there. As was
discussed earlier,
[2:29:23] uh we will uh move the um
the uh
[2:29:28] galvanized service line replacement item
to that agenda for further discussion
[2:29:33] and bring back the information if board
asked for.
[2:29:36] At that same meeting we also have the
just talked about the draft development
[2:29:41] reimbursement policy. We'll continue the
discussion on the financial management
[2:29:45] policy.
We also are going to have a review for
[2:29:49] you all on University Lake extension of
services policy. And just briefly on
[2:29:54] that we do expect that we're going to
receive a petition from the
[2:29:58] state. There are some billing wells out
in the
[2:30:03] area of the old
Towers gas station out on 54 that have
[2:30:08] become contaminated from some of that.
And we do expect that the state
[2:30:12] approaching us about extending services
out there. So we're thinking that might
[2:30:16] be coming in October. And I wanted to
give you all an overview of the policies
[2:30:21] that dictate
extension of services in that area.
[2:30:26] » And who pays for them?
>> Yes, this would be a state funded
[2:30:30] project, but there are specific policies
we have on development out in the
[2:30:35] University Research Park.
So we have that on there. We'll have an
[2:30:38] update on our developer community
engagement.
[2:30:43] And then
12-month calendar if you all look ahead
[2:30:47] having questions on that it's in your
packet as well.
[2:30:50] » Okay.
[2:30:54] Any questions from board members about
the schedule?
[2:30:58] If not summary of our board meeting on
your schedule.
[2:31:02] » Yes, I I mentioned one about moving on
the gallon service line replacement to
[2:31:07] the next meeting. We also had a request
to schedule board presentation on
[2:31:11] professional services procurement. And
we will look for an appropriate time to
[2:31:17] get that scheduled as well.
[2:31:21] » I don't think you missed anything.
Thank you.
[2:31:24] If there are no other business for the
board,
[2:31:28] are there any other business for the
board?
[2:31:30] If not,
without objection, the board of
[2:31:33] directors will be in a closed session to
discuss confidential information
[2:31:37] regarding cybersecurity in accordance
with NC General Statutes 143-318.11.a.9.
[2:31:47] Following the closed session, we will
reconvene in open session
[2:31:50] after completing any other business.
The board was planning to enter a second
[2:31:55] closed session to discuss personnel
matters. However, I'm going to suggest
[2:31:59] we cancel that on the fact there's just
not enough board members here tonight to
[2:32:05] have a conversation.
[2:32:07] I think we need more than six.
[2:32:12] All right.
[2:32:15] So, we're going to enter closed session.
>> Yes.
[2:32:17] » Excellent.
>> Thank [clears throat] you.
[2:32:19] You're going to stick around and
Tim and you're going to be here for the
[2:32:24] This is the cyber
>> I'm sorry. I'm glad I missed that. Yes.
[2:32:31] » This is closed session on cyber?
>> Yes. Closed session on cyber security.
[2:32:34] Do you want to stay?
>> Yes, so you'll stay.
[2:32:35] » So, me, Monica, and Stephen will stay as
well as Tim and Simon.
[2:32:39] » Great.
>> I need a shirt.