[0:05] Um, I want to give it just a minute, few

[0:10] minute or two more because Brian's supposed to join.

[0:14] » Oh, okay. >> And he's he's got the majority of the

[0:18] agenda.

[0:24] He confirmed with me yesterday that he would join. You might have seen he did a

[0:29] flurry of emails to everybody today.

[0:40] Oh, speaking of

[0:46] » Hi, Brian. >> Hey, Chuck. Sorry about that. I had to

[0:50] redownload the app here on my cell phone. How are you?

[0:53] » Oh, okay. Another Zoom Zoom issue. >> James, how are you?

[1:02] » Doing fine, thank you. Jim works. >> Good. Good, Jim. Thank you.

[1:10] » All right. So, let's see. We don't have Mr. Overheiser, looks like,

[1:17] and we don't have Mr.

[1:24] We'll [clears throat]

[1:27] put that up in case it joins. All right, let's uh we can get started.

[1:33] It's 7:03. [clears throat and cough]

[1:38] First order of business is we have um the meeting minutes from last last month

[1:44] and the month before. Can I have a motion to approve both of

[1:48] those minutes?

[1:52] » So moved. second.

[1:59] All right.

[2:03] Um, so way I've organized these notes uh

[2:08] this this month was, you know, I put all the deep related work issues together

[2:15] and then um interconnection and then, you know, some of the other issues that

[2:20] are coming along. But um

[2:25] um Brian sent around an email earlier. Uh I've integrated that into here. Um

[2:32] but there's a few other additional questions I wanted to

[2:35] » ask um while you're here, Brian. I'm not holding out much hope for this,

[2:41] but >> did any additional doc documents surface

[2:44] in from the deep file room? Uh, >> you know, perhaps our asbuilt diagram or

[2:51] anything like that? >> No, not yet.

[2:55] And um part of the notes there indicated that we're going to be working with

[3:01] Lorero engineers and part of the initial scope there will

[3:06] be geotechnical analysis. So, we'll understand what the existing

[3:12] cap conditions look like and formulate a plan and work with Deep on that plan.

[3:17] Um, all in all, I I think we'll really be able to have something submitted to

[3:23] Deep by the end of July, which would be a a pretty good effort right now based

[3:28] on where we are. um which gets us into early next year for an approval from

[3:34] Deep Q1 on their six-month timeline. >> Right.

[3:39] » So that that'd be a that'd be a pretty good result based on what we're seeing

[3:42] from deep right now to be honest. >> And we had a fair amount of discussion

[3:47] about that in our last ATF meeting. And um the question came up, you know, what

[3:52] can we as a task force or a town do to try

[3:57] um accelerate the timeline? Yeah. So, that's a great question. Um, I

[4:03] think it starts with us getting the full package submitted to Deep. Then from

[4:09] there, I think advoc advocacy from the town could certainly help. But until we

[4:15] have a package submitted and received by Deep, um, you know, there's no need in

[4:20] really trying to, uh, push them along or or rush them, you

[4:24] know. So I think once we have something submitted and obviously we'll keep you

[4:28] guys in the loop every step of the way. I think from there some outreach from

[4:32] the task force to the town would be good for sure.

[4:35] » So who would and what what form would that take?

[4:41] » Could be as simple as emails to start. Um and I will pull those individuals

[4:45] their contact information off of the email. And you got that email

[4:51] too from Darren Wright I believe at deep opd office of permit planning

[4:58] development where he summarized who was on the call and and what their roles

[5:03] were. It's the solid waste division that we submit the post closure use

[5:09] authorization to.

[5:15] We were even thinking of uh you know contacting our our state representative.

[5:22] Um I don't know if they anything like that is have you seen anything like that

[5:28] proven prove effective in the past? >> It could be. Yeah, it could be. It it

[5:33] kind of just depends on, you know, if um if that representative has any

[5:39] relationship with deputy commissioners at Deep or anyone at Deep and

[5:44] management, you know, to kind of just let them know, hey, you know, we're this

[5:47] is a project for the town and we're trying to keep it on track and when

[5:52] we're on our pre-application call, Deep mentioned they were underst staffed and

[5:56] it's going to take longer than anticipated. So, we're just trying to

[5:58] understand how to move that along. Um, the other thing, the other change that's

[6:03] going on, not sure if you guys have seen it, um, the deep commissioner is

[6:08] stepping down at the end of this month and Emma Simino is stepping in as acting

[6:14] commissioner appointed by the governor. So, that's Katie Dykes who is stepping

[6:19] down at the end of June and Emma Samino stepping into that active commissioner

[6:24] role. Um, you know, we'll see. We'll we'll see

[6:28] what that brings. I'm sure she's going to want to kind of make a statement and

[6:33] maybe things will go smoother than we expect, right? What better than as a new

[6:38] commissioner to start pushing out permits on time or ahead of schedule? I

[6:44] mean, I know that's optimistic, but that's how I'd think about it at least.

[6:49] So you're saying if we if we get something into deep by July and

[6:54] everything goes smoothly, we're looking at possibly January for an answer from

[6:58] them. >> Correct. Yeah. On the on the on the

[7:01] postclosure use authorization permit. And that's feedback directly from that

[7:07] department at deep in our preapp call.

[7:12] » All right. Stepping back a step. Is there anything that you need from us to

[7:16] get make sure we get the thing in by July? Is there anything any

[7:22] » Sorry, Tom, I cut you off. >> No, you heard the question.

[7:25] » Yeah, so not necessarily. Uh really at this point, the ball's in our court.

[7:30] Like I said, we're going to be working with Lorero engineers to put together

[7:34] the plan set that gets submitted to Deep. We just did this with them for the

[7:39] Planeville landfill and we just did about five others with a couple of other

[7:43] engineering firms. So, we have a good idea of what Deep's looking for right

[7:47] now. So, getting that package together is again squarely within our court and

[7:52] something we're working on right now.

[7:56] » And just just remind me again so we have it done. [clears throat] You're

[8:00] expecting to put in the package by when? >> By the end of July. Yeah. [snorts]

[8:07] » Yeah. So, let's see. I think I had uh I had that in the notes there. Number

[8:14] three. >> Yeah.

[8:16] » Committed by the end of July. Yep. >> I think I put it down below. Um

[8:23] » and then >> Sorry. Go ahead.

[8:27] » You're going to be using the rail then for um the engineer for all aspects of

[8:33] this uh project. coming at least within their scope

[8:38] » for for civil. Yeah, they they don't do electrical. We'll use a different

[8:42] engineer for electrical. Pure power engineering.

[8:45] Pretty big firm. We've done a ton of work with them over the years. Again,

[8:50] these these projects are pretty standard on the electrical side of things,

[8:54] especially with what we've done lately. So, no real surprises anticipated on the

[8:58] electrical side. Uh, in my last update I mentioned that we had an email from from

[9:05] Eversource indicating that the impact study was fine, no upgrades. We don't

[9:11] yet have final costs or an interconnection agreement, but that's

[9:16] the next step in what we'd expect from them to receive.

[9:20] Uh, that's a positive update. I've seen a lot of wacky things from Eversource

[9:26] lately when it comes to costs and project impacts. So, that's a pretty

[9:30] good that's a pretty good update there. Um, and then on the local side,

[9:36] obviously, we'll start that right around when we submit to deep, that'll usually

[9:42] be completed before DEP is completed. And then it's it's really you're

[9:47] effectively, you know, if you get your approval, you know, you're approved

[9:50] contingent upon receiving your permit from DEP because, you know, we could get

[9:54] our uh approval from planning and zoning as the accessory use. Um, but then

[9:59] obviously we can't go and build anything until Deep says we can. So that'll

[10:04] happen in the interim while we sort things out with DEP and get the

[10:08] postclosure authorization permit from them.

[10:11] » But does that mean the AS bill will be done by uh the end of July?

[10:17] » No. So we'll have a permit set we'll have a permit set drawing done by the

[10:21] end of July. It's typically like a 30% plan set that you use for permit

[10:26] applications. you know, if if planning and zoning in and deep is okay with it,

[10:30] then we'll move straight to 90s uh and then finals probably around the end of

[10:36] the year and go and get building electrical permits from the town for

[10:40] with construction sets and go to there. >> I should have asked that differently.

[10:45] And I'm at the asbuilt diagram for the um closure of the of the land that

[10:54] recreate. Yeah, it it could be. Um I think it could play out a couple

[10:58] different ways. If we can find what we are looking for and things are

[11:03] available, that can that can certainly occur on a much quicker and smoother

[11:08] time frame. Um but if we submit a package to deep and they ask for more

[11:14] information and more testing, then we have to we have to kind of do that while

[11:19] we're in that process. And that's something they asked of us recently on a

[11:23] geotechnical side of things as it relates to settling and looking for like

[11:29] a different [clears throat] boring in a different location of a landfill just

[11:33] depending on what it was being used for prior. U so it's it's really an

[11:39] open-ended answer because we have to see how deep comes back to us.

[11:47] » Okay. So Brian, this is Jim, just to confirm, you've got a system impact

[11:54] study from Eversource. Then >> we do. Yeah. So we we did that study and

[12:00] we have so I should say we have an email indication from them that we can install

[12:06] the system with just a new service and a recloser

[12:10] » and avoid like major system upgrades. Yeah,

[12:13] » we don't yet have a final study report or an interconnection agreement

[12:18] » that'll come. We just we'll just continually beg uh we'll continually,

[12:22] you know, reach out to Eversource asking for that information. Once we get it,

[12:26] we'll share it with you. >> You don't have the facility study yet

[12:30] that identifies um the uh requirements for

[12:35] interconnection. >> Yeah. So, we'll probably won't have to

[12:38] do a facility study here simply because we passed C because we passed the impact

[12:44] study. >> Typically, you don't. Typically,

[12:47] Eversource does both a system impact study and a facility study. The system

[12:54] impact study um studies the in this case distribution

[13:00] system um electrically. The facility study is more specific as it relates to

[13:07] the facilities required to to interconnect and your point of

[13:12] interconnection. >> Yeah.

[13:16] » By eversource. >> Yeah. And what we've seen lately is that

[13:21] on projects like this interconnecting to a good three-phase circuit,

[13:25] » we don't we they haven't required a facility study.

[13:29] » Oh, okay. You know, for example, I've done large overbuilds before of like a

[13:32] mile plus and we've had to do a facility study so that they can get cost down to

[13:38] » what they call like a plus or minus 25% range.

[13:42] » Um, so we do we definitely don't anticipate them requiring a facility

[13:46] study on this. >> Okay.

[13:48] » But again, we don't have that final result, the final report yet. Got it.

[13:53] » Or the or the agreement. As soon as we get it, we'll, you know, send it to you

[13:56] guys so you have a copy obviously. >> Right.

[14:02] Okay.

[14:11] Oh, I think I did. So, yeah. So, just to reiterate, you've sent

[14:17] the lease or the anticipated timeline is um permitting an approval Q1 of 2027.

[14:24] He'd start construction in Q2 of 2027 and complete in Q3 2027 if everything

[14:32] goes smoothly.

[14:36] [snorts] >> Yeah. Yeah. That that's that's our you

[14:38] know that's a high level schedule right now. And I said a couple action items

[14:42] we're working on and what I'll get for the next meeting is like a more detailed

[14:47] uh development schedule or permitting schedule. It just kind of outlines our

[14:51] local and state approvals. Then we can move and get a construction schedule

[14:55] which kind of focuses on site mobilization, array construction

[14:59] starting with foundations, racking modules, inverters, then electrical. Um,

[15:04] and in that we'll include our, you know, like our mobilization plan or staging

[15:12] and parking plan that we'll work on with Matt Turnowski, make sure he's

[15:16] comfortable with it. Um what'll what'll be included in that is like number of

[15:21] anticipated deliveries uh daily vehicles on site during certain

[15:27] during certain construction activities because like you know it'll there won't

[15:31] be a lot of guys on site for the foundations install which is like

[15:35] concrete block large block gets put down then we have to build the racking mount

[15:39] the wire mount the modules and wire we'll have more we'll have more

[15:43] individual manpower on site and less big machines by At that point, all the

[15:48] deliveries will have been made. So, we'll just make sure we, you know, we

[15:52] adequately kind of demonstrate that to Matt, make sure he's comfortable with

[15:57] how we're approaching it and where guys will park and and enter and exit and all

[16:01] that.

[16:05] And I mentioned this to Brian, but the time I bumped into um Jack Kelly at the

[16:11] Strawberry Festival, he came up and talked to me and uh

[16:17] you know, he mentioned uh the solar project and asked me if Matt had been to

[16:20] any of the meetings. I said no. But um he's still concern concerned about the

[16:25] road and getting equipment in there and interfering with transfer station

[16:30] operations. You know, I told him we were

[16:33] entertaining the thought of maybe doing it on on a Monday when the

[16:37] transportation is closed, at least for a lot of the deliveries if we can.

[16:43] Um, and he seemed a little bit more relaxed about it when I mentioned that,

[16:48] but it's still something that may come up. But have you gotten more feedback

[16:53] from him in the board of finance meetings?

[16:57] » I haven't had a board of finance finance meeting. I ran into him at the

[17:00] strawberry festival, too, but I didn't talk to him at all about that.

[17:03] » Um, a board of finance meeting is I don't it's uh um a week maybe next

[17:11] Monday. >> No, another two weeks from Monday, I

[17:14] think. >> Okay.

[17:17] » And then you guys will be off for two months.

[17:20] » Yeah, then we're off for two months. So I um

[17:25] I I just think the main thing his main concern always is to make sure that

[17:31] Brian interfaces to our public works guys,

[17:35] right? And so that he's going to always mimic whatever public works says. Okay.

[17:39] So that's that, you know, you know, I think I stressed that last time, Brian,

[17:45] is that it's it's very important that every step of the way we kind of go

[17:50] overboard to interface with public works about how this is all going to work,

[17:54] right? >> Yeah, absolutely. So I think that'll,

[17:58] you know, just just as background here, we had um a wetland delineation

[18:03] completed a couple weeks back. We made sure we gave Matt heads up that he that

[18:07] we had a guy on site. I did the same thing today. We'll have a surveyor on

[18:10] property tomorrow or the next day to get the boundary done. And then I think once

[18:14] we have these data points here on like deliveries, manpower on site, you know,

[18:20] site activation and mobilization, I think I'll I'll reach out to Matt in the

[18:24] next probably in the next two to three weeks and set up a meeting with him uh

[18:28] and just like introduce that whole plan. and then, you know, we'll just we'll

[18:33] we'll talk about it and make sure we end up with something that that works for

[18:37] him in public works. So, that's that's definitely something that, you know,

[18:41] we'll be able to accommodate him on. Um, like I said, I I think I like I

[18:45] mentioned before, maybe even that board of finance meeting. Uh, almost every one

[18:49] of the landfills we've built is also at the town transfer station. So, to date,

[18:54] we haven't had any issues with traffic jams or being in the way or or holding

[18:58] up anything really of substance. So, um, you know, okay,

[19:04] » we'll definitely work through that with Matt.

[19:07] » Okay.

[19:11] » Okay. Um, so remind me again, when does our lease

[19:16] option uh expire? >> So, uh, June 25th.

[19:22] And, um, last week I traded a couple emails with attorney Kaylin. Today I

[19:28] sent uh an extension around to first selectman O'Neal. Attorney Kalin was on

[19:33] that uh email. So I'll just keep I'll just keep close eye on it. Uh plan to

[19:39] touch base with the first selectman probably by the end of the week and uh

[19:44] just see where where he's at with the town attorney um and go from there.

[19:48] » Just keep in mind that the end of the week is Thursday, not Friday.

[19:52] » That's right. Thank you. Yep. [laughter] No, thank you. because I that happens to

[19:57] me all the time. I'll slip and it's Friday morning and

[20:00] » I'll call a town hall and that's it. [laughter]

[20:02] » So >> yeah.

[20:05] Is there any difference in the language of the lease extension option than there

[20:11] was in the first go round? So, uh, the lease itself is more robust,

[20:17] but the commercial terms are really the same. Uh, decommissioning

[20:23] term and and, uh, and and payment, option period, due diligence period,

[20:29] contingency period, the whole nine yards. So, it's it's really just a more

[20:34] robust agreement meant to capture the active term of the lease, but it really

[20:39] mimics that option. Oh, no. I'm sorry. I was just clarifying

[20:44] if this second lease option extension is any different than the lease option that

[20:50] was originally signed. >> Oh, no, no. It's So, the extension is is

[20:54] something that was built into the lease option itself, right? It kind of gives

[20:59] us the ability just to extend to continue the development of the project

[21:04] while we negotiate and sign the lease so that you know we're not stuck without

[21:09] the option to enter into a lease while we're working on the permitting and

[21:14] interconnection. >> Okay.

[21:19] Well, I mean, we can see we can try and help

[21:23] keep monitor monitor that, but um you know, you'll have to take primary

[21:29] responsibility for it. >> Yeah. Yeah. No, that's no problem. Um

[21:33] obviously, Chuck, you're CC that email. If you want me to add anyone else in, I

[21:37] could do that, too. U but obviously, we'll make sure you guys are in the loop

[21:41] and I'll stay on top of it. >> Yeah.

[21:46] All right. [clears throat]

[21:50] Um, you know, I have included links to all the materials that we gathered at

[21:55] the outreach session in case you need them for your package

[22:02] with a planning commission. >> No, thank you. That'll be helpful. Uh,

[22:06] definitely part of our application package will be summarizing outreach

[22:09] work to date uh and some of the feedback from those meetings, what kind of

[22:13] questions were asked and how do we answer them, etc. So, I'll definitely

[22:16] pull from that material and we'll be able to capture capture that in our

[22:19] application. >> And then all of this stuff was from your

[22:24] email, right? Um that is being done in terms of getting the

[22:29] package together. >> Yep. Yeah. Perfect. Right. So it's the

[22:34] the the steps are kind of survey wetlands, create that base map, layer in

[22:39] the civil plan, uh work with Lorero, get the site investigations done. Uh with

[22:46] that plan, you know, we needed the boundary and wetlands done in order to

[22:51] get, you know, the proper uh survey and information to submit to planning and

[22:55] zoning. And that'll also cover what we'll need to do for the engineering

[22:58] package. So those are just two two critical first steps and those will be

[23:03] completed by the end of this week. So we'll have the base map and surveys

[23:06] ready to go.

[23:10] I mean, when we talked with Jordan a while ago, you know, he he just had this

[23:16] laundry list of things including maintenance plans, you know, how

[23:19] environmental concerns will be addressed, wildlife mobility,

[23:24] any screening along the property line and so on of things he mentioned. But,

[23:29] um, >> have you talked to him at all about

[23:33] anything else that the package should should include?

[23:37] No, not not since we had that call. Uh the end of May now. Um and what he said

[23:43] was like once you get survey and your base map done, if I had any questions,

[23:47] reach back out and we'll kind of just nail down what the full application

[23:51] package will look like. So we'll do that for sure and just make sure we have all

[23:55] the eyes dotted and tees crossed. Uh but we've got all the we've got all the

[24:00] operations and maintenance plans, decommissioning plans, everything that

[24:04] goes along to supplement an application like this.

[24:10] » And you know, they also requested that the package gets to them three weeks in

[24:15] advance. Um and the next meeting their their next meeting will be July 21st

[24:22] or the one that we're targeting will be July 21st.

[24:26] Okay. That that could be a little tight.

[24:30] » Yeah, that that could be a little tight. Um I'll try to get a better schedule of

[24:35] anticipated completion and then let you know

[24:41] where we think we'll end up. [snorts]

[24:46] But I think you said given the deep timelines uh we can be even if we miss

[24:51] the July we'll still be there's not any impact to the schedule. uh if we have to

[24:57] go for the August approval or even September, right?

[25:02] » Yeah, that's right. Because our keep in mind our our gating item on permitting

[25:06] is definitely going to be that deep approval.

[25:09] So, the goal obviously is just get planning and zoning done before you get

[25:14] the deep permit. And you know, ideally, I think we'll have planning and zoning

[25:17] done by fall at the latest. Okay.

[25:25] Um

[25:28] » and um yeah, the accessory use is the other

[25:33] issue with the planning commission. I >> Well, I don't I don't think that's an

[25:37] issue anymore, at least not after the conversation we had with Jordan. uh his

[25:42] his goal was to apply as an accessory use because the the solar is secondary

[25:49] to the primary use of the land which is which is landfill right in the transfer

[25:54] station. So that was his goal and that'll be what we're going to be

[25:58] focused on. If something changes then obviously we'll have to deal with it and

[26:02] take it in stride. Um but that's that's the plan right now is accessory use.

[26:12] So is that what planning and zoning needs for them to approve it is the

[26:17] change in accessories use? >> Yes.

[26:20] » Or is that what So it's not necessarily a deep requirement. It's a requirement

[26:24] from from us. >> Correct. Yeah. So this is strictly town

[26:29] land use where it's not necessarily a change. It's more so

[26:35] » like an update to or something or >> Well, it's just our land use permit. So,

[26:39] if this was just a raw piece of land like a green field, then if we didn't

[26:43] have the proper zoning, then we'd have to seek a zone change or a text

[26:47] amendment or something to that effect. But because there's a primary use here

[26:50] already, that is the landfill. And this project is an accessory to that, meaning

[26:56] the purpose of the land is not to host solar. The purpose is the land is for

[27:00] the landfill. That's why we're taking the the permitting approach as an

[27:03] accessory use rather than like a primary use.

[27:10] which would avoid perhaps a likely delay to try and get the zoning changed.

[27:16] » Isn't that the right interpretation?

[27:25] » Yeah. No, that that's that's correct, Chuck. Yeah. Um and in you know in some

[27:30] cases um you might not even have code like

[27:36] zoning code written for solar. So that's that's when it would get really tricky.

[27:41] Um, that's why accessory uses is definitely the best path to take.

[27:50] And I, you know, thinking about it because I've done a few of these,

[27:55] anything could happen, but I don't see why planning and zoning would have an

[27:58] issue with that. You know, like we're not changing the primary use of that

[28:02] property. So, it is a pretty straightforward argument where

[28:07] the primary use of that land is always going to be the landfill, right? until

[28:12] that changes and everything is excavated and removed if that ever happens. But um

[28:18] you know we are truly an accessory to the to the use here. So

[28:24] it's not a stretch is a long-winded way of saying this is this is not a stretch

[28:28] asking for this. >> But they it hasn't formally been given

[28:33] to the planning and zoning people yet. You're still

[28:36] » That's correct. Yeah. >> Okay. And you anticipate this by

[28:41] the end of the week next week? >> No, we're sorry. We're anticipating a

[28:46] submission in July. Um, and depending on if we get it to them soon enough before

[28:52] their meeting, maybe they'll be able to take it up in July. If we're too late,

[28:56] then it'll kick to August or September if they don't have an August meeting.

[28:59] Yeah. >> Okay.

[29:02] » Yep. But the accessory use was the recommendation of Jordan Marcino after

[29:07] speaking with him. who's the town's land use administrator.

[29:13] » Okay.

[29:17] » All right.

[29:20] » Um I want to move on to the land lease agreement. Um there were some questions

[29:26] that I had in reading through it. Um,

[29:31] you know, there's this language in here about capping

[29:36] the um what's going to be set aside the 10 cents per watt DC of installed

[29:42] capacity of the solar array. And um I know talking to Dan Colton, our finance

[29:49] director, he picked up that the array is a little bit smaller than the array that

[29:54] was originally in some of the presentations. So that the revenue is a

[29:57] little bit or that amount is a little bit lower but

[30:01] um but you know I this means that there

[30:06] would be an upper limit of seven roughly $72,000 that are set aside for the de

[30:11] decomi de decommissioning right I am interpreting that correctly. Yeah. No,

[30:18] that that's correct. Yeah. Um and on the final system size, so since we don't

[30:24] have the full engineered plan yet, that system size is not final, right? Uh we

[30:31] could be able to get all the way back up to or even just a little above what we

[30:35] had originally proposed. Uh we obviously need to just kind of do the permit set

[30:40] engineering, make sure the space and the contours and everything are as are as

[30:45] designed. So um that system size is not final yet. We'll get there through the

[30:50] permits at engineering. >> Okay.

[30:55] » So I'm trying to understand how we you know how this ends up being um protected

[31:01] from inflation over time. Um there's this whole timing of various options.

[31:08] some of them not, you know, we being that set aides aren't being even done

[31:12] until what 10 or 15 years from now um under the proposal.

[31:18] But how do we you know how how's this amount end up being adjusted for what

[31:24] the future dollars will be? So, we're we're setting that limit now

[31:31] in hopes of trying to have a clear picture of the full economic situation

[31:37] of the project. And that number doesn't include any scrap value added in.

[31:45] Obviously, there's galvanized steel, there's copper, uh aluminum frames on

[31:50] the modules. It gives no credit to what any of that value is for the array

[31:56] itself. U so that's purely like a just a removal cost and these kinds of projects

[32:03] you know we don't have any buried conduit so what we see drive up like

[32:08] removal or decommissioning costs on other ground mounts is excavation to get

[32:13] conduits out here everything is surface mounted so the the anticipation of cost

[32:18] is like I should say more predictable than other projects where you know we're

[32:24] doing earth work to remove things that were installed Here we don't have that.

[32:28] So the costs are are definitely more stable.

[32:34] » But this $72,000 is this in today's dollars or in dollars

[32:41] from some point in time in the future.

[32:45] » Oh, that that would be in today's terms. So $72,000 just based on the final

[32:50] system size, the 10 cents a watt. >> Yeah, that's what I thought. So then is

[32:56] there an inflation adjustment that gets set year-over-year or on a regular

[33:00] schedule? >> Not as it's written in now. No.

[33:06] » Should it [laughter]

[33:11] if that's a position of the town, you know, we'll certainly take it up. Yeah,

[33:15] for sure. >> I mean, do other towns have an inflation

[33:19] thing that they upgrade, you know, update every couple of years?

[33:24] » Not. No, not on this. >> Okay,

[33:27] » this is a this is a pretty uh this language is pretty standard across

[33:32] the majority of our leases uh especially those of landfills.

[33:43] I think some I think some towns have looked at the landfill project as like a

[33:48] we just keep it running as long as possible uh because because we're not

[33:53] doing anything else with it really.

[33:58] » Have you has your company had a lot of um experience in decommissioning?

[34:05] Like I mean this is is is this a best guess or you know how

[34:10] No. So what we do obviously we know the cost to install the project and

[34:16] construct it to a certain specification right that would meet final inspections

[34:22] and independent engineer evaluation. Um so then we go and get quotes and say

[34:27] what would you charge to just rip this whole thing down?

[34:30] » Right. You know we're not just taking a wrecking ball to it but it's

[34:35] » Yeah. Yeah. It's it's deconstruction rather than construction. So, it's

[34:40] deenergized. You don't need electricians to take everything apart, right? It's

[34:46] just regular laborers taking it apart. >> Um on like a on effectively just like a

[34:53] labor manhour perspective. um some some sort of equipment here to remove the

[34:59] ballast blocks, but again, no like major earth work or ripping anything out of

[35:03] the ground, for example. >> But but at at this point, your company

[35:08] hasn't had to decommission anything, have they?

[35:10] » No. No, we haven't had to decommission anything. We've removed rooftop systems

[35:15] and then reinstalled them to have roof work done and re and re- roofs, etc. So,

[35:20] we we've done work like that. Um taking it down is not the issue. putting it

[35:25] back up is because again you're reinstalling

[35:28] » to breakation. Yeah. >> Yeah.

[35:34] » Hey Brian, this a gimmick. Um long story short, I think you guys are

[35:41] severely light in decom costs 2026. you're in at 72. My estimate, and I

[35:50] didn't, obviously it's not designed so you can't uh screw it down to the last

[35:56] penny, but I'm in a 3 to 350,000 bucks to pull the thing out in $26.

[36:05] So, we're I I guess it's probably best best to say we think you're

[36:12] significantly light as it relates to your decommissioning costs.

[36:17] » Okay. >> All right.

[36:19] » Yeah. So, any kind of adjustment, you know, if you want to propose that if

[36:24] that has to go back to the town attorney, uh or you want me to take that

[36:27] just right now, I'll take that too and and we'll take it back and see what we

[36:32] can do. Obviously. Yeah. I mean, that's my opinion.

[36:37] » Yeah. No feel about it, but

[36:43] » yeah. No, like I said, happy to happy to entertain it and try to get to a spot

[36:47] that >> Yeah.

[36:48] » that works for the town, you know. >> And I, you know, I do think it's

[36:53] important to have some sort of inflation, you know, probably linked to

[36:56] the CPI. Um,

[36:59] » I wouldn't Chuck. I mean, Jesus, talk about um crystal balls. Stop playing

[37:07] that stupid effing game and just [clears throat] just identify him as

[37:12] $26.

[37:18] You'll get tangled around the axle, I think, if you try to tie it to CPI or

[37:23] any other damn inflation index.

[37:29] » [clears throat] >> Well, what's the what what exactly is

[37:32] the financial consequence of this number,

[37:36] you know? Um, so what it does it the financial consequence of the number is

[37:43] that when we go to decommission, if it costs more,

[37:48] then what happens? So that's on us, right? That's on the

[37:54] project. the town has no responsibility to decommission

[37:58] um per the lease, right? If if we didn't decommission on time or on

[38:04] schedule, we could be you could take legal action against us. Obviously, the

[38:09] thought of having the shity bond or the letter of credit in place is that you

[38:12] don't have to go there and you can just go straight to that financial mechanism

[38:17] uh and handle the removal itself. Now what we run into is obviously the the

[38:22] higher that number is the larger impact it has on the project economics. Uh

[38:27] obviously our lease rate is is fixed. Our revenue is fixed. Our cost to

[38:33] construct continue to rise at this point outpacing what we have built in for like

[38:40] a two to threeyear inflationary period just in construction costs. But again

[38:45] that's our problem. That's that's kind of what we're seeing as we go to

[38:50] construct projects now that you know we secured revenue contracts on in 2024. Um

[38:56] what we have modeled for like construction cost increase in that

[39:00] 24-month period uh has definitely been outpaced by what we're seeing for the

[39:06] actual cost to to build these projects. But again that's an that's an US pro

[39:11] that's a me problem really. >> Right. So, I guess what I'm getting back

[39:16] to is that this 72,000 to me is the kind of

[39:25] secondary insurance for the town if Baragy fails. Is that effectively the

[39:33] the point of the money? >> Yeah. Correct. Right. If we don't abide

[39:37] by the obligations of the lease and remove the array um you know in lie of

[39:42] taking legal action immediately you can call upon that that financial mechanism

[39:48] I think which we've provided like a shy bond or a letter of credit option.

[39:58] » Okay. So that the I guess the bottom line is though is that

[40:04] so if all goes to plan, right,

[40:12] it it shouldn't it it shouldn't cost us anything. And the number that the 72,000

[40:20] is really you it it's not like we get the 72,000, you get the 72,000. Correct?

[40:28] if we even need it. >> Yeah. If you even need it, right?

[40:31] » Yeah. So, again, it's a it's a shy bond. Uh we'll pay a premium on it on a bond

[40:36] valium on the bond value to carry that bond per the contract. Um and then

[40:41] obviously if it needs to be called upon, it's it's called upon, but the ideal

[40:45] situation is that it is never called upon.

[40:49] » Okay. And then the last bit I'm trying to get the bond value. So, you know, one

[40:56] one kind of, you know, um something against inflation, Chuck, usually is

[41:02] this is invested somewhere and pays an interest, then the interest is what's

[41:07] supposed to be offsetting the inflation of some sort.

[41:09] » Yeah, that was my next question. So, um is is that anticipated for this?

[41:17] » That's a good question. I'd have to confirm with our current bond providers.

[41:26] which I can do. I can get more detail on that.

[41:31] Let me take that down.

[41:47] Um yeah, because you know in the worst case, right, is there's there's not

[41:51] money enough and the this doesn't offset the cost, then then the town might end

[41:56] up with the decision to have the ray not fully decommissioned or

[42:02] bear the financial responsibility for decommissioning it if you know Very were

[42:08] to be out of business or you know for whatever reason couldn't cover the costs

[42:13] of decommissioning, [clears throat]

[42:16] » right? So that that's our insurance against that outcome, right?

[42:22] correct our financial insurance against that outcome.

[42:26] » Yeah. So [clears throat] um yeah and we have to come agree as you

[42:33] know from what Jim was saying we have to come to an agreement on what the the

[42:37] proper amount would be

[42:42] and if it comes in the form of an investment that's what offsets the

[42:47] inflation chuck in some sense >> right assume assuming that is and and

[42:53] it's a [clears throat] you know reasonable rate of return

[42:58] Yeah, >> inflation is a hard thing to predict.

[43:01] » No, I know. But I mean, that's that's that's what's supposed to be that's

[43:04] there for, right? >> Yeah. Really, I think it's all we could

[43:08] ask for. >> And let let me go back to Jim's uh point

[43:12] real quick. Jim, I think you said you were at 350,

[43:16] was it? Or 370? >> No, 3 to 350.

[43:20] » 3 to 350. That's right. >> Yeah. Let me let me take that down. But

[43:25] that does not in that does not um include the salvage value as you point

[43:32] out Brian and um typically my experience has been although there is value

[43:38] associated with salvage it's not included when when establishing a bond

[43:46] amount um to um

[43:53] protect an owner for the the uh the work to happen, so to speak, the

[44:01] decommissioning to take place. >> Yep.

[44:08] » And again, to be clear about this, right? So, if all goes well, the shy

[44:12] bond goes back to you, correct? >> Yeah. Yes. Yes.

[44:18] » Okay.

[44:22] So the cost to you is really time value money I guess for setting aside

[44:28] something that maybe you could cash in right away or something.

[44:33] » Yeah. Exactly. Right. Or or the carry cost of the bond for example.

[44:37] » Yeah. Um so the bond the bond premium for the duration

[44:42] uh or like if it's letter of credit setting aside the letter of credit

[44:46] obviously it's not um the letter the letters of credit are not invested we

[44:51] have to hold a lot of those for deep um okay so I have um I have feedback from

[44:58] Jim on 3 to 350 and I'll talk to the team on this

[45:05] » okay I also got very confused in clause 4K

[45:10] because now you know we're talking about a shity bond or a letter of credit

[45:16] or other guarantee you know corporate or other guarantee there's like four

[45:21] different options that you know could be chosen at the tenants's choice but I

[45:30] mean if this is an agreement it I mean shouldn't the the options be discussed

[45:35] outside of agreement and we pick one and [clears throat] you know everything all

[45:39] our conversation today has all been around this decommissioning bond which I

[45:43] assume is the shity bond we're referring to.

[45:48] » Yeah. And I think what what we've seen recently, Chuck, is that there's more of

[45:52] a lean towards that shity bond uh just because most people are familiar with

[45:56] it, comfortable with it. So what what we can do and we'd be fine with this is

[46:01] just like red line the other options just out of the agreement so that it's

[46:07] just strictly the the shity bond. Again we're we're trying to create a situation

[46:12] in some cases where say for example like uh Very gets acquired by Next Era right

[46:20] in five years like Next Era just bought Dominion. Um, would a parent guarantee

[46:24] from next error be sufficient for removal of the array? Some people might

[46:29] say yes, others no. >> But yeah, sure. I I understand. But how

[46:37] how would that operate in a [clears throat] in in a an agreement

[46:41] that we're signing today? I mean, there are four options, but we we would have

[46:46] to pick an option. yet that

[46:49] » in the clause 4K it's it says we can pick four options but there's no doesn't

[46:55] seem to be a mechanism for which one that we actually pick

[46:59] » unless I just didn't read it right >> no no again that's that's trying to give

[47:05] the tenant or the project in this situation uh like options to to like go

[47:12] forward with the most cost-effective solution

[47:14] » I think he's just trying to give us flexibility Chuck But you're saying we

[47:18] don't want flexibility. Just give us god damn it. Give us give us an answer.

[47:23] » And and that's that's fine, right? I'm as you're explaining it, I'm realizing

[47:28] now, too. Less is more. Um and if the town's comfortable with the shity bond,

[47:33] then that's the way we go, you know, and we just say that now and agree on a

[47:37] value and we're all good and that's that.

[47:41] » Well, okay. I I But I'm still getting hung up on it.

[47:46] Let's just say we keep the four options in there. Then

[47:51] how do they get actuated? What one option or another? And how do they do

[47:56] they potentially change over time? Is I couldn't find any language in there that

[48:01] kind of outlined the mechanism for how things would be done over time if we

[48:08] were to switch. >> No, the likely outcome is that it

[48:13] wouldn't change over time, right? one of those four would be chosen and then

[48:16] that's what would be used throughout the duration of the term.

[48:21] » I mean is >> I guess check saying when's it when's it

[48:24] chosen?

[48:27] » Um when's it chosen? Let me see here. >> Yeah, because it says written in

[48:33] agreement at as at tenants's choice. So does a tenant get the option to choose

[48:39] at different points in time? >> No. the the time at which it's

[48:45] it's um provided is fixed. I'm just pulling up a copy of this lease right

[48:50] now. The tenant would have the option to choose

[48:54] which mechanism of shity is provided, but the time at which it's provided is

[49:01] fixed. Let me pull that up. It >> should be written right in that section.

[49:06] » I would have assumed it's at the point we signed the agreement.

[49:15] Well, it's not going to be at the point we sign the agreement because we could

[49:18] sign this lease on July 1 but never end up building the project because of

[49:23] permitting or or other issues. >> Yeah. When sorry when it becomes

[49:27] operational.

[49:36] So Chuck, I mean, my attitude is keep them all in there until the last

[49:40] possible moment. [laughter] It's just optionality for us, right? I

[49:45] guess unless you think it's going to drive us nuts explaining it to Board of

[49:50] Finance and everybody else.

[49:56] » Well, I certainly can't explain it the way it is because I don't understand how

[50:00] it actually works. Yeah, I' I'd probably

[50:06] if it was me, I'd probably cut some of that back and stick with just the shity

[50:10] bond in the decommissioning bond format rather than have those other options in

[50:16] there. The more and more we discuss it and, you know, kind of being in that

[50:21] board of finance meeting a couple months ago and having done a few of these, I

[50:26] think less is more. So if it's if it's cut and dry, it's the shy bond. It's

[50:32] this value. Um this is a common mechanism that's used in this state and

[50:36] other states. I think it's pretty straightforward.

[50:40] » Yeah. Well, that that would make it a lot easier to explain for sure.

[50:43] » Yeah. Okay. Let me take that down as a note.

[50:46] » But are we equally protected? Are we, you know, by doing this, are we setting

[50:51] ourselves up for any future >> problem? Chuck, this is this is this is

[50:54] your problem from working in GE or something. You want to figure the you

[50:58] want to figure the option of the option of all of these four different things.

[51:01] And should we That's why I was saying if I was just uh playing my max ar, I would

[51:07] just hold the options off to the last possible moment to figure out the max

[51:11] value of which option, right? But if you do that, you're going to drive we're

[51:16] going to drive oursel nuts, I think. So I feel like we should choose the choose

[51:21] one and and get on with it. Unless you can unless

[51:26] you know one of the you know shorty but I mean we should I I I like

[51:32] seeing examples so let's let's see what other towns have done I guess.

[51:38] » Do we need to have a lawyer weigh in on what option would protect us more?

[51:43] » Yes. >> Yeah.

[51:46] » Absolutely. >> But I I don't know. My sense of these

[51:50] things is the lawyer don't know. He knows a little bit but doesn't know a

[51:53] lot. It's going to be one of those things where you need a, you know, uh,

[51:57] complicated options trader with lots of experience and some sort of trading to

[52:02] say this one is marginally more better than the other one. And I I feel like

[52:06] the amount of time we're going to spend on it, unless we can look at examples,

[52:10] um, the amount of time we're going to spend on it, it's going to drive us

[52:13] cuckoo.

[52:19] » Yeah. Because at the end of the day, Tom, um there's no financial impact to

[52:23] the town, right? The the the town's >> Well, there is, but it's a second it's a

[52:29] secondary option. It's a it's a it's like a it's you know and unfortunately

[52:35] Chuck and I have spent a lot of our lives looking at this kind of secondary

[52:39] option but >> I don't want to spend this part of my

[52:43] life looking at this this secondary option y

[52:46] » when I I don't really think it matters that much but um but yeah Chuck let's

[52:53] you know if we can find Brian do you have examples so of all these four

[52:57] things do you have towns and using them or do you is is that almost every town

[53:01] just used the shity bond. >> So we've what what we've done with other

[53:05] towns is kind of narrow it down to the shity or the letter of credit. Um

[53:11] and what we see broadly across the market is more shy bond, right? Like

[53:18] more decommissioning bond type structure that's been developed to satisfy this

[53:24] this requirement across other projects across other states. For example,

[53:30] And a letter of credit would come from a bank or somebody would what would uh

[53:35] » yeah letter of credit would come from us issued through a bank. Uh right now we

[53:40] issue our letters of credit through Mnt. >> Okay. And Okay. And it would be like

[53:48] financially in the same it would be a similar similar number whatever the

[53:54] number is going to be. >> Correct. 72,000 or 350,000 to Jim said,

[53:59] [laughter] you know, whatever the number is going to be. It would be the letter

[54:02] of credit wouldn't have a different number than the shity bond. Okay,

[54:06] » that's correct. >> Yeah,

[54:08] » the letter of credit, you know, to Chuck's point, I guess I

[54:13] have to remind myself about again since I asked about the shy bond. Well, that's

[54:18] » letter of credit would have to have some sort of adjuster

[54:24] for inflation or something in it to be equivalent if the insurance bond paid

[54:29] interest, right? I don't know. You know, like there's got if there's if there's

[54:33] some if there's some inflation, we have to look and see if there's an inflation

[54:39] adjustment of mechanism of some sort built in

[54:42] either of them, like an assurity bond or the letter of credit. Yeah. So, how the

[54:47] letter of credit works right now is that if the value changed, we'd have to

[54:51] reestablish it. Um, that just that would create like

[54:56] it's not a big it's not a big uh like just administrative burden, but it would

[55:03] be there. Ideally, we'll set the value now, right? Like if we agreed to 200,000

[55:09] in today's terms and then we inflate inflated out over time to

[55:14] 280,000 or 300,000 just again totally random numbers then we just go with that

[55:19] number and put that in and that's where we're at. Mhm. So I guess the question

[55:25] is can you build? So what what is the mechanism either for interest or or

[55:33] um change in you know in the value of the

[55:37] letter of credit over time? I mean, can you build that into the original um into

[55:43] the original um statement of whatever the thing is?

[55:48] Um or is it something that needs to be adjusted over time if if it if it

[55:55] doesn't work? I mean, if it seems like it's not working

[55:58] » based on my limited knowledge, it would be the latter where today we could set a

[56:04] letter of credit for a specific value. But then again, if that has to go to a

[56:08] different value at some point in the future, we have to go get a new one and

[56:12] deposit more money into that letter of credit. Uh, that I could be wrong.

[56:18] That's based on my limited understanding of of doing these for Connecticut.

[56:22] » Just giving my given my kind of sense of some sort of to me the shity

[56:28] bond might be better Chuck I would but I have to look at the details of the shity

[56:32] bond.

[56:36] » Yeah, this is outside of my area of expertise.

[56:42] Um

[56:46] but I I was also very confused about how these options get funded. There was some

[56:51] language in the in the agreement, but I thought it was very vague.

[56:56] Um, it seemed to me that, you know, just a

[57:00] yearly schedule of funding and value, you know, whether it's inflation

[57:05] protected or not, you know, it could be laid out as a yearly schedule and then

[57:09] it would be very apparent how much money is being funded and when it's being

[57:14] funded.

[57:20] I mean, >> okay, let me see what I could get. Let

[57:22] me do this. Let me spend a couple minutes with my finance team, try to

[57:27] pull an example shity bond and then get like a

[57:32] get like a schedule built out. Um, but the more and more we we talk about this,

[57:38] I think just like establishing and agreeing upon a value and setting that

[57:42] value either inflation adjusted uh or on a schedule is probably our best way to

[57:47] go for ease of explanation to board of finance.

[57:53] » Yeah. And >> the the the really would make everything

[58:00] clearer for me would just be that give an example like you said just give an

[58:04] example and >> you know um

[58:08] » and show how it works right >> and if I've read it right this bond

[58:13] isn't even being established for the first 15 years

[58:20] which you I can understand. Well, you know, the

[58:25] project has a good deal of time before we're going to have to decommission it,

[58:30] but it seems like we're completely unprotected for those first 15 years.

[58:35] You know, I'll be at a secondary protection.

[58:40] Um,

[58:44] » yeah. So, the language as it's written, the bond gets established in year 15.

[58:48] Um, and you're not, it's not that you're unprotected.

[58:52] The the over the overarching goal of these projects is that they operate for

[58:57] their entire contracted period, right? And we've seen assets, solar assets,

[59:02] come through bankruptcy proceedings before. We've bid on them. We've never

[59:06] won any. Um the most recent and probably largest in the solar space recently was

[59:13] Pinegate that went bankrupt and that that went through a bankruptcy

[59:17] proceeding. Uh but at the end of the day there are operators and financeers who

[59:23] are going to buy these assets at different stages in bankruptcy and

[59:26] operate them through them through their terms. So the goal is always that they

[59:31] operate for their useful life.

[59:37] And there's always going to be someone who's looking to capitalize on that,

[59:41] especially when you have a fixed price contract with an investment grade

[59:44] offtaker like like Eversource.

[59:49] » So in essence, you're saying we could just use the use the funding from the

[59:54] asset. We we would get the asset. We use the funding from the asset to pay for

[59:59] the decommission.

[1:00:03] Well, you just let the you just let the asset operate.

[1:00:07] » Yeah, it's just going to pass to a new owner. We wouldn't we wouldn't assume

[1:00:11] control or ownership of it. >> Well, but the So the but what's the So

[1:00:17] we have to negotiate with the new owner about I mean so the new new owner has to

[1:00:20] take on you're saying the decommission >> the the agreement. Yeah. The agreement

[1:00:25] as written. >> Okay. Yeah. So so new owner has to take

[1:00:27] on the decommission as written. >> Okay.

[1:00:31] Well, what if it happens in year 10?

[1:00:37] » Well, what he's saying is that they still have to take off the commission in

[1:00:41] year 15 if they buy when they buy it. >> Correct. Yeah. the sooner it happens, if

[1:00:46] if it were to go to if the asset goes to bankruptcy in year two, that's just even

[1:00:50] more incentive for a new asset owner to come in and want to operate that project

[1:00:54] because you have 18 more years of contracted revenue at at fixed prices,

[1:01:00] right? Then you have, keep in mind that like the backside of this is uh once you

[1:01:05] have your 20-year operating period of the ever the NRES contract, the curves

[1:01:10] right now just show the price of electricity continuing to escalate far

[1:01:14] beyond what it is today. So the anticipation is that asset owners are

[1:01:20] going to operate these projects for as long as they can. You know, like that's

[1:01:23] the goal. If they were to get kicked off the property, then you're kicked off the

[1:01:27] property. But the goal is to continue to operate these projects and sell

[1:01:31] electricity for as long as possible. Even if in 35 years you're operating at

[1:01:36] uh you're only producing 82% of what you did in year one. Uh it's modeled in and

[1:01:42] it's factored. So that's the goal is to operate these and if they're going to

[1:01:47] continue to operate and abide by a lease and pay lease payments, then you know

[1:01:51] why not?

[1:01:56] I mean, I guess the thing the this is another kind of moving part in

[1:02:01] this contract, I guess. And so, if I were a fly in the wall and I was a

[1:02:06] really good lawyer and I looked at the 10 contracts you've done with every

[1:02:09] town, is every town accepted the 15 years or somebody bumped it up to 10 or

[1:02:14] five? >> Um, I don't know off the top of my head.

[1:02:18] the 15-year is is definitely our standard and where we start.

[1:02:25] Um, I'd have to confirm. I'd go as far as to

[1:02:29] say couple of the contracts we have right now don't have a decommissioning

[1:02:35] shity bond built in. Um, again, a landfill property. Some the

[1:02:41] position of some towns has been that they'd like this to operate and produce

[1:02:45] revenue for as long as possible.

[1:02:51] Well, this the shy bit the timing of the shity bond has nothing

[1:02:58] to do with that, does it? I mean, when the you know,

[1:03:04] I guess from our perspective, ultimately we'd love to have the shity bond as soon

[1:03:08] as possible. We not no matter how long you have it, right?

[1:03:12] » Yeah. Correct. And from our position, that's just going to cost us more money

[1:03:15] over the >> Exactly.

[1:03:17] » over the term, right? It's it's an additional expense for us for longer,

[1:03:21] » right? And so, I don't know, it's like one of these things like when we used to

[1:03:25] negotiate about credit default swaps and things like that, there's all these

[1:03:30] little micro terms in there that could make a difference in these things,

[1:03:35] right? And >> it's better if they're all standardized

[1:03:39] because which which because then everybody accepts the standard, right?

[1:03:44] It on the other hand, if I find out, I don't know that one of your other

[1:03:48] people, you find out one other people negotiated with you and got five years

[1:03:51] instead of 15 years, then we all feel like idiots. Okay. So, um um I guess

[1:04:00] that's the question is to what degree is I mean if

[1:04:09] if I thought this was standard, I might leave it. If I thought it was if I

[1:04:13] thought it was something that you push hard on it, you give us five years

[1:04:17] instead of 15, then I negotiate, right? >> Yeah. And I think um it's it's an

[1:04:24] interesting one because we're in a tough spot. Um we're in a spot where I've

[1:04:31] spent a considerable amount of money developing and advancing the project. Um

[1:04:35] and if if the town were to come back to me and say, "I'm not signing this lease

[1:04:39] unless you give me the shity bond at year five or year one." And again, just

[1:04:44] to be completely transparent here, do I shelf uh $150,000 of spend to date and

[1:04:51] say no, or do I agree to that and keep moving forward? Right? So, again, I like

[1:04:58] cards on the table. I'm in a tough spot. Um because I don't have an ability to

[1:05:04] move forward and build the project with the contract I have with the town

[1:05:07] currently. I have a considerable amount of uh spend at risk

[1:05:13] » and and a and a desire to get a contract with the town that I could actually

[1:05:17] build and then get a permit from deep and then get a permit from the town. So,

[1:05:22] » okay. Um >> I'm effectively at your mercy.

[1:05:26] » No, I I get all that. I guess my question is convince me that 15 years is

[1:05:30] standard and maybe I'll >> or is there another mechanism that you

[1:05:35] know is more of a win-win for both? like maybe an escrow account, right? That

[1:05:41] isn't going to cost you um like a shity bond would

[1:05:46] kind of a hybrid approach.

[1:05:50] » Yeah, in that situation it could be, but it would just be splitting hairs really

[1:05:55] probably the amount of escrow versus the the carry cost for the bond. Um

[1:06:00] we could run the numbers on an escrow that starts earlier on.

[1:06:09] But I think really you have the security of whether it's Varigy or uh James

[1:06:17] Templeton Enterprises. The the idea is to operate these projects for as long as

[1:06:22] possible, right? It's not that Very goes bankrupt in two years and then nobody

[1:06:26] wants to touch this project. Uh there will be a new operator looking to come

[1:06:31] in there because they think it's a distressed asset and there's money to be

[1:06:34] made, right?

[1:06:40] So, because somebody's willing to come in, if you I feel bad like we're telling

[1:06:45] you your company is going to go bankrupt, but if your company should go

[1:06:48] bankrupt, it's not like we would rip it out because you're saying somebody would

[1:06:52] come in and then we just create a contract with them so we don't have to

[1:06:56] worry about ripping it out. >> No, really, the the contracts stay in

[1:07:00] place. So, the revenue agreement continues.

[1:07:02] » Yeah. But they but they just they just they just pick up the

[1:07:07] Okay. Correct. >> Yeah. They pick up the same contract.

[1:07:10] That's what it's pointed, I think, Kathy. So, that they they would still

[1:07:14] » So, we wouldn't necessarily decommission it because somebody else is just going

[1:07:17] to pick up the contract. >> Well, correct. And and Right. Correct.

[1:07:20] That's one thing. And the other thing is that they're still in the contract to

[1:07:24] put up the bond after 15 years, but then maybe it's 10 years or something. they

[1:07:29] still have they still have the obligation to put up the bond for

[1:07:33] decommission in 10 years or whatever that is.

[1:07:39] » Okay. I think um one of the things that might

[1:07:44] make the town feel you know more comfortable about this is um can we get

[1:07:50] updated certified financial statements um

[1:07:57] from you

[1:08:01] uh maybe yeah let let me talk to let me talk to our accounting team

[1:08:07] um maybe I think the easier way really is just to agree on a shy bond value

[1:08:14] that you know you're comfortable with and that the town attorney is

[1:08:17] comfortable with and we agree on when that will be established and move it

[1:08:22] forward. Again, I'm I'm just trying to think of

[1:08:25] like ease of >> Well, why would we need a financial

[1:08:30] statement, Chuck? Because we're not we're getting the same amount of money

[1:08:34] per year for renting the land. So, why would we care what the

[1:08:37] » No, no, no, no. But Ch what Chuck wants is a financial statement of Verarajy,

[1:08:41] » right? >> He he wants to make sure that Varagy is

[1:08:44] sound right now. >> Oh. Oh. Oh. Oh. I thought we had easy

[1:08:48] math on our side. Okay. >> All right.

[1:08:51] » Uh but um >> yeah, I guess

[1:08:56] » the main thing to me about the 15 year is 15 years is convince me that it's not

[1:09:01] something you put up and then give other towns 10 or five for some reason.

[1:09:09] Yeah. And I'm trying to think. Let me go back and look through some leases

[1:09:13] because what I did was put together a chart for attorney Kalin and I sent that

[1:09:18] to him just with like the the contracts we had with other towns. Let me put that

[1:09:24] together and um send it over to you. I'm I'm almost confident that the year 15 is

[1:09:33] like our our standard, but I don't want to misspeak on that.

[1:09:37] » Okay. >> And again, so not not to belabor it, but

[1:09:40] how we how we just financed a batch of these projects is through a sale lease

[1:09:45] back with uh Mnt Bank. We did a sale lease back with First Source prior to

[1:09:50] that. So we'll we'll group these assets and then

[1:09:55] effectively sell it to the bank Mnt Bank for purposes of them capturing the

[1:10:01] investment tax credit we lease it back as the operator. So if the as the

[1:10:08] operator if we were to default on our financing agreement with Mnt Bank, they

[1:10:14] step in and take ownership of the project. like they might then choose to

[1:10:21] find a new operator, right? Or they would just own it and hire companies to

[1:10:27] do the asset management and operations and maintenance. Um, so that's that's

[1:10:33] like the most likely financing mechanism. That's how we will finance

[1:10:38] this project again because we have to find a way to monetize that federal tax

[1:10:44] credit which is typically done by the banks and the sale lease back is the

[1:10:48] most common method right now uh that a lot of folks are financing these

[1:10:52] projects. >> Yeah. No, I I get all that. And so the

[1:10:58] key things to me are what Kathy was just speaking about, right, is we go through

[1:11:02] that process, this contract stays in place, including the shy bond in year

[1:11:07] 15. >> And um the second thing to me is that I

[1:11:12] just want to >> um

[1:11:15] I want to, you know, I don't want to feel like you've been duped. In other

[1:11:18] words, you come out with 15 and then if you're a really savvy town, you get 10,

[1:11:23] right? Yep. Yeah. Let let me put that together again. I don't want to misspeak

[1:11:27] on that. Um I definitely know we've done 15 before, but let me add that to the

[1:11:34] chart and I'll send it over to you.

[1:11:40] Okay. [clears throat and cough] Well, yeah, you can tell there's a

[1:11:46] couple of guys on this on this um task force that spent a

[1:11:51] career in risk management with financial services.

[1:11:55] » This is kind of the bread and butter of not so much what I did, but probably

[1:12:00] more so what Tom did. I was more in the things. You get exposed to it um whether

[1:12:08] or not you're actively working in that group or not. Yep.

[1:12:13] » No, I get it. I get it. >> Usually all the money is in how you

[1:12:16] argue. All the money is in the options that people don't see

[1:12:20] » or think about. >> Correct. Yeah. If if you guys are

[1:12:24] golfers, you've probably heard that every match is won and lost on the first

[1:12:28] te. [laughter]

[1:12:31] » Right. So, anyway, let's get let's go on, Chuck, though. Let's beat they beat

[1:12:35] this to death. Yeah, I think I think we're done with the update. Um I have

[1:12:42] like small amount of other things I want to talk to to the task force about, but

[1:12:48] um yeah, I haven't set up anything with the fire marshall yet. Um I don't see

[1:12:53] that as critical path yet, but um let me know Brian if it becomes critical path

[1:13:00] and we can move that up. >> Yeah. No, good good point, Chuck. I

[1:13:03] think what's best once we have like an initial site plan draft from our

[1:13:08] engineer and definitely prior to going to planning and zoning, we'll meet with

[1:13:12] the fire marshall and just give them the rundown. Definitely want to do that

[1:13:15] before we submit anything to P&Z, but I want to have a little more detailed plan

[1:13:19] than I have right now. So, probably in a few weeks would be good time and I'll

[1:13:24] make sure you know you and I are connected on that.

[1:13:27] » All right.

[1:13:34] Okay. >> Okay. No, thank you for your time.

[1:13:38] » Great great to speak with you all. >> I hope

[1:13:42] » Trying to watch the kids in the backyard here. So, sorry for the noise.

[1:13:45] [laughter] >> All right.

[1:13:47] » Go do that. That's more important. >> Have a good night.

[1:13:50] » We'll talk to you. Bye. All right. Thank you. Bye.

[1:14:00] All right. Well, what do you guys think?

[1:14:07] Well, again, the thing that drives me nuts about these things is

[1:14:14] I've seen lots of situations where you put out a template with six things that

[1:14:20] if you can get, you get, you know, um if nobody argues, you get it. If somebody

[1:14:27] argues, then you give in and give them something better. But um I don't know if

[1:14:33] that's this kind of situation or not. Right.

[1:14:37] I mean and and most of the options are around the

[1:14:42] margin anyway. We're talking about like secondary options which for them is

[1:14:48] generally big could be big money but for us it's probably not as big a deal as

[1:14:54] unless something really you know outlying stuff happens right.

[1:15:00] But it's good to um it's good to see what we can get up front. And I be

[1:15:05] definitely

[1:15:09] we do we know who So we have the list of other towns he's doing this for now or

[1:15:14] has done it for? >> He's going to give us a list, but um

[1:15:18] » Okay. Yeah. >> Yeah. We don't Apparently the attorney

[1:15:21] has. I haven't seen it. >> Right. So, I'd like to see if the other

[1:15:26] any other towns have gotten better terms. That's my that's my biggest kind

[1:15:31] of concern with this stuff. >> Yeah. I just want to make sure we're

[1:15:36] adequately protected. Something goes up. I just I worry a little bit because

[1:15:41] they're doing a lot of projects and, you know, they're obviously selling this.

[1:15:45] They're not holding it. They're selling it all, right? Um, so,

[1:15:50] um, that smacks a little bit of securization to me and you know that's

[1:15:55] that's that's a tough hole to yourself. >> It does, but on the on the flip side of

[1:16:00] that, as he says, it gives MNT Bank or somebody else the the kind of desire and

[1:16:09] motivation to make sure it keeps running, right?

[1:16:14] » Yeah. We almost need a financial statement from them.

[1:16:21] Um, well, no, I don't know. I think it gives the opposite side of the the the

[1:16:28] equation uh skin in the game for us, right? So, um,

[1:16:34] » yeah, >> that that's probably a good thing.

[1:16:38] » Yeah. >> Yeah, I'm a little more comfortable

[1:16:42] um with that. And then, you know, it really isn't quite like securization,

[1:16:46] but just um I mean, salary specs are pretty

[1:16:51] common, right, in the financial world.

[1:16:59] In general, solar developers want their money out of these projects as quickly

[1:17:04] as they can get them. >> Yeah.

[1:17:06] » They can get it. I mean, and so that's the kind of the mo the mode that the PV

[1:17:12] solar guys use. Whether it's res, commercial,

[1:17:17] utility, scale, doesn't matter. It's all the same.

[1:17:22] » Yeah. I think they're probably just spreading their yourself financially

[1:17:24] thin, right? >> Yep. Yep.

[1:17:27] » Um, >> but what I'm saying is that they

[1:17:30] understand these options a lot more than we do,

[1:17:33] » right? You know, they've got it. I'm sure they've got a very, you know,

[1:17:38] extensive analysis of what it means to do 10 years versus 15 years or what it

[1:17:43] means to do to do 72,000 versus 300,000, right? And so, um, they got a guy

[1:17:51] sitting back there who can give a put a number to that really quickly, I'm sure.

[1:17:56] » Yeah. >> But, um, now,

[1:18:00] you know, does it matter that much to us? I'm not sure.

[1:18:04] I think what you're trying to do in this case is just protect the town as it

[1:18:09] relates to getting rid of the ship at the end of life. Um, and I'm not sure

[1:18:15] it's any more complicated than that. To me, the answer is go to a shity bond and

[1:18:23] don't complicate it. But I mean, I think chase it, pull on the string, see where

[1:18:29] it goes, let him do his his due diligence on it, and get back to us.

[1:18:35] » Yeah.

[1:18:38] Um,

[1:18:42] so some of the other recommendations I've seen are about adding

[1:18:45] decommissioning triggers um such as the project ceasing operation

[1:18:51] for 12 months, bankruptcy, abandonment or end of fuseful life um to the

[1:18:57] contract. Um I don't know. Have you seen that kind of

[1:19:02] language, Jim? >> Mhm. Yep.

[1:19:06] » You think we should? But as he point as he points out um

[1:19:12] if even if these things are chugging along at 80% efficiency after 15 or 20

[1:19:20] years or 30 years um there's value in it

[1:19:26] » and somebody will buy somebody will buy it and try to extract that value um for

[1:19:33] as long as they can. I know. But this is the flip side of it,

[1:19:37] right? This is, hey, the project's not in operation anymore or there's been

[1:19:42] abandonment, right? >> Yeah, fair enough. I understand.

[1:19:48] » And you know, we should we should be specific.

[1:19:52] » Well, go ahead. >> That's different than bankruptcy.

[1:19:56] » It is. That is

[1:19:59] » um >> Well, that I I know. So, the So, yeah.

[1:20:03] So Chuck, the the real danger to me seems to be and this the biggest danger

[1:20:08] for us seems to be 2027.

[1:20:13] [laughter] Um you know that if they get half into

[1:20:18] this or get you know you know build half the thing or

[1:20:26] » or if they don't finish it. Yeah. >> Don't finish it. what um you know and

[1:20:32] then they go bankrupt or pull out for some reason then what do we do

[1:20:38] » or if we or there's a trade embargo and we can't get parts.

[1:20:43] » I think they already have the parts. >> They do have all the parts. Okay, that's

[1:20:47] » I don't know if they have them all but at least the panels and so on they say

[1:20:50] Harvard. So they told me um to preserve the federal tax credit they had to do.

[1:20:57] Well, I know, but if they go in bankruptcy, then people are going to go

[1:21:00] after the parts, right? [laughter] >> They'll have a tag sale.

[1:21:05] » You betcha. [laughter]

[1:21:11] » So, yeah, but nursing this through to get to end of 2027 is going to be to me

[1:21:16] the trickiest part in some ways. >> Yeah. Well, we got to walk that line

[1:21:23] between and I think they're going to push back, right, on a [clears throat]

[1:21:27] lot of the stuff we asked for tonight. >> Well, yeah. And their leverage is Yeah.

[1:21:31] that they they can in essence walk if they want to,

[1:21:36] » right? And it's not the first time he's mentioned this when we start to push him

[1:21:41] on things. No, >> I know. I know. And well, we knew that

[1:21:45] all along. So, that's that's his leverage. He can if if the thing doesn't

[1:21:49] really meet his specifications, he can in

[1:21:54] essence walk.

[1:21:58] And but I'm hoping that we both have get gradually got enough skin in the game

[1:22:04] little by little that he won't and we won't unless under really nasty

[1:22:10] circumstances. Do you think that $150,000

[1:22:16] number that he mentioned is is uh is real in terms of what their spend has

[1:22:22] been to date?

[1:22:27] » Who knows? Who knows? Nobody knows this crap. Like, you know, um we're sitting

[1:22:32] in this waste thing and you know, so we got a grant for 17,000.

[1:22:38] I think 17,000 in most companies buys you uh a coffee hour in a meeting with

[1:22:46] with with [laughter] half the people >> with Danish.

[1:22:49] » You put you put the right people in the room at 17,000 in a in a two-hour

[1:22:53] meeting. Okay. Um so I who knows what the spend is, you know, those kind of

[1:22:58] things are like way up in a kind of um um

[1:23:03] » supposedly they bought all the panels for the project. So we could do a

[1:23:06] computation on that or Chim might even have a you know off the cough answer. Um

[1:23:12] you know >> a watt

[1:23:16] » but in in theory though he could just use that for something else if he walks

[1:23:21] go someplace. >> Absolutely. Yeah.

[1:23:24] » So >> um

[1:23:26] » you know than that he's done some engineering but it's not too detailed

[1:23:30] yet. Um I don't know. I don't you know

[1:23:36] maybe an opportunity cost, but maybe not real cost. I don't know.

[1:23:45] But um anyway, let's keep trying to nurse it. I

[1:23:50] mean, I I guess what I want to see is that you know what I don't want coming

[1:23:55] back to me is five years they go bankrupt and Planeville says, "Oh, I got

[1:24:01] five years out of them. Oh, I I got 350,000 out of them. Oh,

[1:24:06] and you guys are just duped.

[1:24:12] Um, I think we should be specific about what

[1:24:16] needs to be what decommissioning means. Um, you know, this is the list that I

[1:24:22] came up with, but um, you know, removal panels, racking,

[1:24:28] foundation, wires, transformers, you know, yada yada yada. But is there stuff

[1:24:33] in here that we should take out or add? >> Me, I'd approach it from the other

[1:24:39] perspective. Return it to its current condition.

[1:24:45] Don't try to delineate everything, Chuck.

[1:24:49] » But I'm not I'm not the attorney in the crowd and have no desire to be the the

[1:24:56] the attorney in the crowd. >> Well, you know, there was something in

[1:24:59] the agreement about take it back to the

[1:25:04] there was some tricky language in there. I thought I got to go back and refresh

[1:25:07] myself on it, but it wasn't I wasn't sure they were actually saying they

[1:25:12] would actually take it back to its present condition. I think they

[1:25:17] I think they said they'll take it back to the condition that it was at at the

[1:25:22] end of construction or something like this. you know, it did,

[1:25:27] but uh I would, you know, urge you to read through it um and help me sort it

[1:25:33] out.

[1:25:40] » Um yeah. Do we need an engineer prepared

[1:25:45] estimate of the value of the thing over time?

[1:25:50] » To what end? Well, I just saw that recommendation somewhere with no

[1:25:55] justification.

[1:25:58] » I better run it by you. >> I think it's a waste of money and time

[1:26:03] unless there's a specific need for it. But if you're referring to what the demo

[1:26:08] demo costs are, what a waste of time. >> Yeah.

[1:26:17] Okay. Well, that's pretty much it of things that I thought about.

[1:26:24] » Yep. Your last bullet. I agree. I mean, the contract is in force

[1:26:31] um if it gets sold. I mean, subject if they I mean, the new owner may come and

[1:26:37] try to renegotiate it, but you know, that stands on its own. Um Yeah. I mean,

[1:26:43] contracts in force. >> Yeah. No, that that that one's

[1:26:48] important. I think that's and he agreed to that, I thought, today.

[1:26:51] » Yeah. >> Yep. That's right.

[1:26:53] » Yeah. So, we should write it in the the agreement.

[1:27:00] I don't think it's in there, but it could be.

[1:27:04] » You know, I get lost in some of the lang legal language or impatient with trying

[1:27:08] to sort through it. >> Right. I don't see why he I don't see

[1:27:12] why he should object to the last point. >> Um, no. the he now Mnt Bank might object

[1:27:18] to the last point. I don't know. That's that's what's why that's the problem

[1:27:23] when you're doing this whole in between stuff and and the standards, right? And

[1:27:27] that's why I was asking about the standards too is that you know Mnt Bank

[1:27:32] and they're going to read through this and they're going to require certain

[1:27:36] things too, right? And so, um, they don't might not like the last point, but

[1:27:42] we've got to I think we have to push hard on the last point.

[1:27:46] Yeah, I think that's fine.

[1:27:52] » All right. >> That's that's a function of the

[1:27:54] agreement between Very and Mnt or whoever is financing the thing,

[1:28:01] » right?

[1:28:08] All right. Well, that's that's all I have for tonight.

[1:28:13] Um, >> if we adjourn,

[1:28:18] [laughter] >> anything else before we close?

[1:28:22] » Nope. >> I'm good.

[1:28:24] » All right. >> Yeah. Thanks everyone. Thank you

[1:28:28] everyone. >> Thank you. One one quick thing is this

[1:28:31] this so when when is the timeline of get getting this

[1:28:36] thing signed

[1:28:39] » is this I'm trying to understand whether >> you know he he said he said June 25th

[1:28:45] didn't he >> he hoped to have it but now that's

[1:28:49] that's the point of the lease extension now because it it means the lease option

[1:28:53] extension right so you know in the event that we can't negotiate this by the 25th

[1:28:59] it then we're going to just extend the current option that we have.

[1:29:06] That's why I asked him if the language is any different than what we already

[1:29:09] have. >> Right. But I don't know. I'd like to Has

[1:29:13] anybody talked to Have you talked to the lawyer? Have you talked to um to um you

[1:29:20] know >> to Tim or anybody about what's going on

[1:29:23] on our side on this? I copied Tim on all all these concerns when I sent sent it

[1:29:29] to Dan and um Dan called me to yesterday I think and um

[1:29:37] you know he said I think we should go for the bond and um you know try to get

[1:29:42] the full amount and he he was concerned that maybe they can't get anybody to

[1:29:47] underwrite that amount for the bond but um but notwithstanding that. But he did

[1:29:55] mention that, you know, it he would discuss some of this stuff with the with

[1:30:00] the um with the lawyer and he said, "I might rope you guys into it." And I

[1:30:05] said, "Please do." Right. >> Okay. I just I guess I don't want to

[1:30:12] extend extend extend indefinitely because

[1:30:16] » um you know, >> it just costs everybody money.

[1:30:19] » It costs everybody money. And um but lawyers tend to do that if they if

[1:30:25] they're given the time, you know. Um so I'd like to see if we can get a real

[1:30:31] let's let's set a real deadline and stick to it.

[1:30:36] » Yeah. No, I'm fine with that, but not at the cost of, you know, material

[1:30:42] risk. >> I agree. But I mean I I I agree. So

[1:30:47] let's keep let's keep doing that. But um doing I just

[1:30:53] it's costing us in other ways to extend I think.

[1:30:59] » So um you it would be good to have in the conversation with the lawyer. Um are

[1:31:05] you going to California anytime soon or anywhere else?

[1:31:09] » Yes. [laughter]

[1:31:14] » Um >> he just decided at this moment

[1:31:17] » [laughter]

[1:31:20] » No, but it's not. Well, it's the or anywhere else and giving you a list of

[1:31:25] where they are would be would take would take take another [laughter] half an

[1:31:28] hour. So, um um but um I'll be back and forth and play and

[1:31:34] around at different times. Not the rest of this, not the rest of this week. Um

[1:31:40] but um yeah, >> next week.

[1:31:45] » Are you here next week? next week on um Monday and Tuesday,

[1:31:55] » international man of mystery. >> Well, I that used to be that. This is

[1:32:01] more just I got, you know, the busy life of a retired guy in the [laughter] in

[1:32:07] the go in the go- go period, not the not the slowgo period or the whatever they

[1:32:12] call it beyond that. the off [laughter] >> there's a very good chance I'm going to

[1:32:18] end up in Mississippi soon um for an unknown amount of time but um

[1:32:27] it's very dynamic but I don't think it's going to occur before

[1:32:32] the end of next week

[1:32:36] based on conversations we had today. Well, is everything still zoomable?

[1:32:43] » Yeah, I think so. We probably could. I mean,

[1:32:49] if we need to

[1:32:53] » Okay. Anyway, so figure out. So, how long's the extension for?

[1:33:00] » I I'd have to go look.

[1:33:04] So when we so call enact I' I'd just like to see I'd like to get

[1:33:10] our lawyer focused on finalizing this at some date

[1:33:19] um soon. Um I don't want to I don't want to give up on things that are are we

[1:33:26] think are really bad negotiating things, you know, that we should just give it

[1:33:30] in. But um I don't want to just let it drag

[1:33:35] forever.

[1:33:39] » Y here's the agreement. Uh it's actually

[1:33:43] very short. >> Um hang on. I got to share again.

[1:33:57] I haven't read this just now.

[1:34:02] year. >> 12 months. Yeah.

[1:34:04] » Yeah. >> So, I don't want to be

[1:34:08] debating about this this time next year. >> Oh god. No. [laughter]

[1:34:14] » No. Definitely. >> I mean, I would have pref I would have

[1:34:16] loved it if it said uh August 25th. [laughter]

[1:34:21] Um >> Well, we could we could make the

[1:34:23] recommendation to change it. [clears throat]

[1:34:26] » I don't know. I mean, again, that's a discussion between Tim and the lawyer

[1:34:30] and stuff, but I feel like what's what's our town lawyer's downside

[1:34:36] to spend lots of time on trivial stuff on this and charges for it?

[1:34:40] » Yeah, he's a contract lawyer, right? [clears throat]

[1:34:47] » All right. Well, >> yeah,

[1:34:49] » we'll talk I'll get up with Dan.

[1:34:55] » Have a good evening. Yeah. Good night to car. Thank you.

[1:34:59] » Good night. >> You guys, we'll see you. Y

[1:35:04] night.

Energy Task Force Meeting - June 16, 2026

Transcript