Longmont City Council – Study Session – September 6, 2022
Note: The following is the output of transcribing from a video recording. Although the transcription, which was done with software, is largely accurate, in some cases it is incomplete or inaccurate due to inaudible passages or [software] transcription errors. It is posted as an aid to understanding the proceedings at the meeting, but should not be treated as an authoritative record.
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Unknown Speaker 8:01
Good evening, everyone. Progress for CES 2022 long months City Council study session to order. As a reminder, this meeting can be viewed on the livestream at www Longmont. colorado.gov and to view that go to Longmont, colorado.gov and the city’s YouTube channel at www Longmont public media.org You can also watch it on Comcast channels eight or eight ad. Can we have the roll call please?
Unknown Speaker 8:34
Mayor Beck present councilmember Dalgo faring.
Unknown Speaker 8:38
Councilmember Martin roselands Mayor Pro Tem Rodriguez, Councilmember waters, Councilmember Yarbro. Mayor, you have a quorum. Thank you. Councillor Hidalgo. Ferring. is absent tonight.
Unknown Speaker 8:54
Yep, stand for the pledge. Thank you, Don.
Unknown Speaker 9:01
I pledge to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all.
Unknown Speaker 9:17
Do we have any motions to direct the city manager to put items on future agendas?
Unknown Speaker 9:24
Seeing none, we’ll go directly to the public invited we heard you have three minutes to speak it please list your name and address when you come up. The first one on the list is Buzz Feldman.
Unknown Speaker 9:53
Good evening my name is Buzz Feldman. I live at 3135 Lake Parkway.
Unknown Speaker 10:00
I’m here tonight to talk to you about pickleball. I was here a few weeks ago, talking a bit about it, and it’s a new sport. It is new in the country. So I wanted to update you and new in Longmont. I want to update you on some recent developments. It’s the fastest growing sport in the country. And also here in Longmont. Estimates are that there are currently more than 1800 participants of the sport here in Longmont and that’s growing daily.
Unknown Speaker 10:38
Last month, the Longmont pickleball club became a member supported organization. We have in just three short weeks have more than 200 dues paying members actively supporting pickleball in Longmont.
Unknown Speaker 10:56
Longmont pickleball club is conducting many events within the city. We give free lessons every week for members. We give numerous We have numerous open play days when anybody can show up and play. We are in the planning process for tournaments for next month. And we have social events planned for the near future also.
Unknown Speaker 11:23
Pickleball has a
Unknown Speaker 11:25
stigma that it’s an old person sport and it isn’t.
Unknown Speaker 11:30
elementary schools in town are very interested in adding it to their
Unknown Speaker 11:36
physical education curriculum this fall and Longmont pickleball club is helping to facilitate that
Unknown Speaker 11:45
little about what it takes. Courts for pickleball are the same size as badminton courts, so quite a bit smaller than tennis courts.
Unknown Speaker 11:55
In the space of two tennis courts, we can fit six to eight pickleball courts so we can get a lot more people playing the sport
Unknown Speaker 12:05
and being active.
Unknown Speaker 12:08
And I’m not advocating for removal of any tennis courts. Currently, we only have six permanent pickleball courts, in Longmont that courts they’re dedicated specifically to pickleball with permanent nets for about 1800 players.
Unknown Speaker 12:28
We also have eight shared use courts that are shared with tennis and also roller hockey. There are six other courts that require the use of portable nets to be put up and then taken down after plays finished. Because the city just didn’t have the funding to create permanent dedicated courts.
Unknown Speaker 12:50
So what I’m here for is to ask you to consider in your as you come talk about your budget for the coming year to consider funding, permanent dedicated pickleball courts
Unknown Speaker 13:03
info on the cost.
Unknown Speaker 13:05
Thank you. Thank you bus.
Unknown Speaker 13:08
The next person is Jamie SEMO.
Unknown Speaker 13:17
Jamie cmo 517 Independence drive. Good evening. I’m here tonight representing Stan with our st brain Creek a citizen action group dedicated to protecting long months riparian areas and the wildlife that lives there. As you know our current priority is protecting the nesting banks while as at Rogers grove. As we mentioned when we spoke with you last month, we have been collecting postcards signed by residents who have asked that you protect our threatened banks while a colony as flood mitigation within the overreach of the same green corridor proceeds. Tonight we have formed an 85 postcards to present to Mayor PAC, people care about our natural areas and wildlife and want to see them respected and protected. These postcards titled SOS save our swallows read. Rogers Grove nature area is home to one of the only known nesting banks while colonies in Boulder County and is the site of the only colony on long lock protected lands. Thanks Swallows Nest and riverbanks with a very specific soil type and slope. due to habitat loss there are rare and declining species and are noted as being a species of special concern in long lines wildlife management plan. The favorite option for long runs flood mitigation project in the vicinity of Rogers Grove will almost certainly wipe out this rare nesting habitat. Therefore I asked before flood mitigation proceeds in this area. City staff come up with a plan to protect the banks while a colony stand supporters are pleased and encouraged by the city’s expressed commitment to restoring this habitat. And by a recent follow up meeting slash discussion we have with natural resources. Time will tell but at this time things seem to be progressing well. Thank you for listening, talk and stick to your constituents. Thank you Jamie Lance Whitaker.
Unknown Speaker 14:55
My name is Lance Whitaker. I live at 1750 Collier street
Unknown Speaker 15:00
You’re in Longmont, Colorado been resident for two years. And like to remind mayor and council today is
Unknown Speaker 15:11
coffee flavored ice cream day. So everybody enjoy coffee flavored ice cream today.
Unknown Speaker 15:19
I also would like to address a couple of issues on Keaton stone Park, I heard you guys talking in the budget that you already had 150,000 budgeted for that park. And to make Keystone Parker, a safer place, I feel that the city should consider Filling in the gap over on Sixth Avenue, so that the police can properly patrol that area. Also, there’s a lighting issue in that park. So if you could maybe figure out some lighting in that park. Also, there is no access to parking in that park. And that if you put some access or found a way to access that park, from Ninth Avenue and put in some parking in the back of the parking,
Unknown Speaker 16:23
that may be that might be an idea. And for future, I would love to see you guys make it a small bike park, to where kids who have uncertainty on bikes can learn the rules of the road. And also maybe become more familiar in a safe environment. And because that’s more or less a park for flood mediation, more than playgrounds, you know, you wouldn’t run the risk of destroying any of the play works or whatever, if we just put in a whole bunch of small bike paths. And, you know, like fun little activities for, you know, kids to find certain paths and find, you know, emblems or whatever on the sidewalk in that area.
Unknown Speaker 17:28
So, just some solutions that you may want to consider.
Unknown Speaker 17:35
My thank you for your time. And remember, coffee flavored ice cream for all? Thank you have a nice day. Thank you let’s
Unknown Speaker 17:48
so is there anybody in public that would like to come up and comment?
Unknown Speaker 17:54
One more, come on up, state your name and address please, you have three minutes.
Unknown Speaker 18:00
My name is Ryan Forbes and I met 303 Kaufmann
Unknown Speaker 18:05
Unknown Speaker 18:07
I’d like to say that
Unknown Speaker 18:09
you know, Longmont is home of a fiber ring. And, you know, you have you guys are talking about planning a, you know, the sound regulations keep track of, you know, where, you know, you can track noise pollution, and be one of the first places in the country to really track that and do it at least on this side of the country. And we’re also home to like one of the biggest
Unknown Speaker 18:35
community makerspaces in the US as well. And I know all of that, because of Longmont public media. And I think it’s a valuable resource. I go there and I produce my own content, I make my half a podcast that I wouldn’t be able to do otherwise. And I’ve met people from the community.
Unknown Speaker 19:01
Because Because of law, I’m on public media. And I just wanted to come here today and just say what value it is to me to have that Makerspace and to be able to use it. And also that I feel that it is
Unknown Speaker 19:18
it’s also one of the things that makes Longmont one of a kind to have like a media Makerspace where people can go can go in basically all week long and
Unknown Speaker 19:29
just make their own content, have access to a cereal have access to a place where they can actually make videos and actually put it up on TV and put it up on online. There’s not a lot of places. I’ve never heard of that anywhere else until I came here. And I would have never even thought to look for it even when I was trying to set up my own podcasts on my own content. Before knowing about Lamarr public media
Unknown Speaker 20:00
Unknown Speaker 20:02
because of that, not only do Do I have a voice, but there’s people in the community that do. And there’s also like my friend, I do the podcast with he he wouldn’t be able to otherwise. And there’s, there’s also, um, there’s voices I would have never heard of my cat. I’ve recently like, learned about finances and things like that from from there as well. And I just wanted to come today and say that I think that’s a great helps make Longmont unique. I think it’s incredibly valuable. And I just wanted to show my support here today. Thank you so much. Thank you Ryan.
Unknown Speaker 20:45
Seeing Noel no one else in the queue. I’m going to close public invited to be heard.
Unknown Speaker 20:51
And now the next thing on our agenda tonight is
Unknown Speaker 20:56
special reports. Do we have any special reports done and no presentation? So we’re gonna go on to our study session items, which is the 2023 budget discussion.
Unknown Speaker 21:09
Unknown Speaker 21:12
officer Jim golden.
Unknown Speaker 21:24
Bear counsel, we’re going to and I can’t read this
Unknown Speaker 21:30
is it this one, Jim.
Unknown Speaker 21:33
We’re gonna start out with compensation. So I have a Gina
Unknown Speaker 21:39
Unknown Speaker 21:42
Sorry, I didn’t get that one.
Unknown Speaker 21:51
Good evening, Madam Mayor, Members of Council. I’ve seen you a couple times Gina Perino, benefits and compensation manager for the city.
Unknown Speaker 21:59
And tonight I am going to present
Unknown Speaker 22:03
the compensation piece of the 2023 budget.
Unknown Speaker 22:07
First off just a couple of things our compensation philosophy, the city’s compensation philosophy states that the city will try to pay competitive and prevailing market rates. In 2017, as previously discussed with council, the philosophy began, the city began moving towards the philosophy of paying at 102% of market. Unfortunately,
Unknown Speaker 22:30
at this point in time, we have not been able to actually afford that. So we have not made that goal yet.
Unknown Speaker 22:38
The philosophies that we applied to 2023 Were we were able to use benchmarks for the positions, whether they be from a survey or internal studies. All ranges we have moved by at least 6% as a minimum and they have stopped at a maximum of 12%. We are recommending to continue to pay at 101% of market and 2023 and the exceptional PE budget is going to continue for employees that exceed exceptional service.
Unknown Speaker 23:11
Some special position recommendations for our collectively bargained or CVA positions. Step positions increase for police is going to be 4%. The fop open range increases will be 6%. And fire step progression is also 4%. And those are their negotiated rates within their contract. LPC step positions will increase a minimum of 6%.
Unknown Speaker 23:39
The benefits for 2023 This is actually a really great year for benefits, as we saw flat renewals for both our dental insurance and our EAP provider. And we actually received a 4.61% rate decrease for our medical insurance through Kaiser. So we actually got a savings on our benefits this year. No other plans renewed. So we will be looking at the rest of the plan starting in 2024. When they come due. I can also report that for 2024 Kaiser has given us a rate cap of no more than 5% of an increase. And we’ve actually received a two year rate cap for Delta Dental for 2024 and 25 for a 5% rate cap so we can receive no more than that. So it was a really great year for the city’s benefits. We saw some great savings and some great flat renewals there.
Unknown Speaker 24:33
As far as future direction, I think the big thing that’s unique this year is the compensation study that we have on the horizon. And I would like to give counsel a little bit of history on kind of where we started with that and where we’re at today. So one thing we started realizing pretty early on was that we weren’t competitive. And the data that we were using was not sufficient for things such as under reporting. We saw
Unknown Speaker 25:00
lot of cities similar to the size of Longmont, there were no longer reporting, which was causing problems with getting actual reputable market for our positions. So when we started looking into doing the compensation study, we put out an RFP and we received some responses which we went through. The one thing that was really common amongst all these responses is that they came from smaller companies that provided a very cookie cutter approach to doing a compensation study, they use one specific type of data. And you basically got a delivered product out of the box, there wasn’t a lot of room for changes or for making it specific to the city or really trying to gather what we needed. So in looking at that, and realizing we just weren’t getting what we wanted. And also realizing that we absolutely were not competitive with our cities around us, which we’re losing employees to, we reached out and ended up contracting with Mercer, who’s one of the big three, there’s three large companies that do compensation studies.
Unknown Speaker 26:00
And Mercer is one of them. So what we’re getting from Mercer is not only a look at the city’s compensation, in essence, a deep dive of where we’re at with our positions. And the fact that we’re actually going to be paying at market value and be leading the market as opposed to trying to catch up, which is where we’ve been using insufficient data. The second thing we’re going to be able to do with Mercer is we’re going to be able to look at what is the future look like? How do we stay competitive in the future, not only with our compensation, but really the question, what is the benefits package of the future look like? What you know, what is total rewards going to be? It’s no longer just health, dental and vision that is driving people and what are we doing to retain people? And what does that look like going forward? So Mercer is going to be able to give us all of those things and provide a great tool for the city going forward, to be competitive, not only in retaining our staff, but also attracting really good quality applicants to come in.
Unknown Speaker 27:03
So some specific things that we’re looking for with the compensation study, is we would like them to review our approved pay plan that we use today and provide recommendations that they feel would better track market that they feel would be better, and also track market competitiveness. You know, what are we doing now? Is it still sufficient? Do we need to look at a different different pay plan. Secondly, we want him to conduct a total compensation study utilizing reputable and reliable comprehensive data, which means actually going out to the market and using large scale surveys. That, you know, we know that we have similar sized organizations reporting into so that we know that we’re actually getting competitive data and not comparing to smaller towns or in some cases, all counties. Third, we want them to analyze data received to determine how our salaries should be adjusted to achieve the market competitiveness that we’re actually looking for. And to make those recommendations going forward so that we can look at
Unknown Speaker 28:03
staying where we want to be in this current marketplace. This is a unique year for compensation. I think the market is moving faster this year than I have ever seen it in the 20 years that I’ve been in human resources. It’s literally moving so fast that we have had comp providers from large places say hold on tight, we don’t know where this is going to end. So um, it’s definitely been unique. This is this is something that I think not a lot of people have seen possibly since 93.
Unknown Speaker 28:35
In looking at the Employee Benefits, we want them to review our total rewards package now and include recommendations for ancillary benefits or other additional employee benefits that maybe we’re not offering. You know, maybe it’s something we haven’t thought of,
Unknown Speaker 28:49
you know, what are other municipalities doing to attract staff? You know, what is their engagement look like? We also are going to have them review our leave plans. Currently, we’ll have them look at the amounts of leave and design of the plans, and also evaluate a benefit for a parental leave program as to whether or not that would be a benefit to the city employees.
Unknown Speaker 29:11
102% definitely remains our goal and hopefully we will be able to get there to pay at 102% of market.
Unknown Speaker 29:21
That was a lot of information in a short amount of time.
Unknown Speaker 29:27
Do we have any questions or discussion from counselors on this presentation?
Unknown Speaker 29:33
Unknown Speaker 29:36
Let me first check. Are we going to get more Is this the sum total of what we’ll get on compensation from this? We’re going to move on to something else? Yes, so this would be the time for anything compensation related? Yes. So So I do have a few questions.
Unknown Speaker 29:52
Maybe just a general observation, just kind of q&a on on your last observations about
Unknown Speaker 29:59
Unknown Speaker 30:00
What we’ll get from this compensation study, what kind of what resonates as I, as I listen to how we’ll think about positions, and what are the kind of rewards is the the other side of that is value both both to the employees and to the organization. So I hope in the compensation study,
Unknown Speaker 30:20
that as we’re looking at positions, and they’re going to be however we classify them and think about compensating them. Part of that part of the equation, or the algorithm, or the I don’t the metric is the value that a position adds to the city’s mission. We got 1000 great people doing great work, I don’t question that. Not every position, at every level adds the same value. And I understand there is a relationship between value and compensation, right.
Unknown Speaker 30:51
But compensation doesn’t always reflect value. And so I think that’s just going to be an important part of this. If I’m in this, I’ll be in the conversation a year from now, as we go through this. I’m going to be really curious about that part of this. Can I go on with, with a relationship between what we do with compensation in the workplace and workforce of the future? Study? I think the first I don’t know how back in December, maybe it was the first meeting in December. Joanne was sharing with us the work you were doing on a work the workplace of the future, and I think slash workforce of the future. We’ve not heard anything about that sense.
Unknown Speaker 31:31
So when we as we are looking at compensation for 2023, I can’t think about recommendations here without and without reflecting on Hmm, what have we learned in the last 11 months or 10 months, however long it’s been about? What we’re what we’ve asked our staff, and others, I assume we might be going outside the organization as well. About about what the work what to expect, what to envision as a workplace in the future.
Unknown Speaker 32:00
About the work force of the future, and how what we’re doing tonight, or will do, as we approve this budget reflects the status of that we’re understand it’s not finished, but this out to reflect something that we’ve learned, could you connect
Unknown Speaker 32:15
the philosophy, long term has been to get to 102%, I’ve been supportive of that I you know,
Unknown Speaker 32:23
but to some degree that, that 102% ought to be informed as well, or whatever, wherever we end up by what we’ve learned about the work so far, and where it’s headed in this relationship between compensation reclassification, which we saw in the enclosure, and with the workplace of the future. And I don’t mean that as a setup, I just we haven’t heard anything since. And that’s the context for understanding what this recommendation helps to advance I think I
Unknown Speaker 32:50
think there’ll be a few of us to jump in on some Can I add one more, and then I’ll be quiet.
Unknown Speaker 32:56
Somewhere in all of that conversation, is workforce of the future compensation, etc. Accountability is the overlay, right? And what does accountability specifically? Because if we’re going to compensate, we’re compensating based on value add based and there’s an accountability, what does accountability look like?
Unknown Speaker 33:18
As we envision at this point in the workplace of the future? And how does this compensation measure up against what we’re expecting? And how we’re going to measure what we see in terms of measures of value added? Right, on the part of the individual? And in work you work unit contribution.
Unknown Speaker 33:39
This makes Does that make sense? Yeah, it makes sense. So we’ll start off with the value add, or we’ll start with the parameters for this. So obviously, in terms of exceptional pay, we have that built in for those that are nominated by their supervisors or their co workers for exceptional pay. I think what we do is when we say market, and
Unknown Speaker 34:04
and we’re going to compensate you at market, you have to be performing and meeting your expectations. And so the reality is, is that if you’re not performing, or you have issues, the supervisors actually have the ability to say, we’re not going to put you at 101% of market, we’re going to put you here. So if you’re on a PDP, which professional development plan, then you’re not eligible for that market salary. Or if there are issues that we had during the year then when we review it, and we, because of all the new regulations and laws, we’re doing multiple reviews on this. And so we have to do equity checks, we have to make sure that we’re not only consistent among the departments that were consistent organizationally. And so when we go in and review, the exceptional pay, the final review goes to Joanne and myself and we sit down and meet with all the directors.
Unknown Speaker 34:56
We have the same review on those that are it’s just
Unknown Speaker 35:00
same spreadsheet where we see he’s getting moved up to market. And
Unknown Speaker 35:06
to give you a sense, there have been times in the review process where
Unknown Speaker 35:11
we’ve seen someone that may not have been exceptional pay that we go, Well, what about this person? There’s been times we’ve seen people that removed a market. And we said, Didn’t this person have an issue during the year and we had to push it back. So there is that accountability piece, in that you have to be performing your job and meeting expectations to move to market? I don’t know if that answers your question.
Unknown Speaker 35:39
To some degree,
Unknown Speaker 35:41
that would be that would be the link between compensation and whether or not somebody’s fulfilling everything in their job description and that they’ve had an issue and
Unknown Speaker 35:51
and whether or not there’s some threshold, right that people pass to get 202%. For me, I’d be more. The really the real question is, what are those thresholds not for holding people back? But But how do we approach what do we what do you see? Or what do you expect to see in the in the interest of accountability? If somebody’s going to go to 102%? Or wherever we’re going to end up with this?
Unknown Speaker 36:20
What do they what do they bring? Where do they start? And what do they bring to the supervisor to say I killed it this year? And, and I ought to be eligible for that. Right? Not catching them something doing wrong, catching them doing something wrong, catching them doing something, right, right, in terms of what their aspirations were going into the year. So Joanne can go over the
Unknown Speaker 36:40
part of the criteria, I don’t have the form in front of me. But you know, one of the things that we built into this, and this was really born out of the work that the organization put together, not me, not my leadership team, the organization. And, you know, the first threshold you have to meet is really living or cultural attributes that we want, as an organization. You can produce, and you can produce something big. But if you’re not living those attributes, which are really embodying creativity, teamwork,
Unknown Speaker 37:12
there’s a list of them, you can do great things. But if you’re not doing this, then you haven’t met the baseline criteria. So it’s really identifying those that are living the cultural attributes that we want. That’s the first piece. JOANNE What are the rest of the pieces? I’m drawing a blank.
Unknown Speaker 37:30
Mayor pet councilmember waters, the additional things we would do once somebody’s met those cultural attributes is, are they working on a very large project that is really adding value to the organization? Or are they adding value in their everyday work. So you may have somebody that works in a department and doesn’t have a large project, but they’re really adding value on a daily basis. So we’ve seen some departments where we’ve gotten commendations from residents, you know, over and over about the same employee, that’s going to be somebody that we want to recognize as well within that exceptional pay program. And it’s evolved to teams to because we know we had issues where it was hard to distinguish one person versus a team so you can nominate teams, you know, we really let people, the only thing I don’t want is where you just unilaterally give everyone a 2% increase to utilize a 2%. We’ve allowed that though, on a couple of occasions. And one that I’ll use as an example that came before me was actually when we converted our fleet into a new building. And Bruce came and he said, I can’t distinguish on this, because here’s the work that we did. And when he laid it out, what you really saw was a team initiative, and we’re like, okay, we can do it in this case. Thank you, Jim.
Unknown Speaker 38:44
So, Jim, sitting right there. Exactly. So we have outstanding achievement on the job, extraordinary effort to complete a job or handle heavier than normal workload, volunteering for and or working on special projects performing extra duties beyond those normally assigned
Unknown Speaker 39:04
exceptional contributions toward the effectiveness and efficiency of operations. Actions that contribute to the maximum utilization of department or resources such as, use and implementing of technology information resources, work practices, standard operating procedures or equipment that achieves more efficient and effective operations, making or implementing creative suggestions at the same time that save time or money. We then go in outstanding service to direct team members, other city employees, residents and or diverse populations,
Unknown Speaker 39:37
doing things for others that are far beyond job requirements performing in an exceptionally courteous and cooperative manner, particularly in the face of difficult
Unknown Speaker 39:45
of difficult citizen or co worker operations. Taking responsibility for promoting team success assessing whenever needed or requested, making a special effort to recognize excellence and other team members valuing differences among
Unknown Speaker 40:00
Other team members,
Unknown Speaker 40:01
Unknown Speaker 40:04
Am I the only one who is interested in the relationship between these recommendations in the workplace of the future? I can follow up with Joey. And if I’m the only one.
Unknown Speaker 40:16
I’m interested in it. But I’m wondering if we would get more of that information as we go on. As to how that relates? Is there anything more in this presentation that we’re going to be getting that would relate to just focusing on the compensation? Are we doing that on 20?
Unknown Speaker 40:34
Unknown Speaker 40:36
Next week, are we gonna we can include some of that next week? In the HR? What I will tell you are there some there are some things that we’ve enacted that didn’t, that were in our administrative regulation. So one that we recently worked through was called back pay. That was a significant issue for folks in the sense that how we were compensating folks on call back and Joanne, what did we adjust there.
Unknown Speaker 41:06
So in that particular case, we added hours, so we are compensation compensating for more hours as a baseline for those callbacks and on call pay. And that’s different on calls when Jim’s on call, and he can’t do anything for the day that he’s on. And so that was something that we were seeing where people were being
Unknown Speaker 41:24
Unknown Speaker 41:26
we needed to adjust it, they are currently looking at and they just I think the vacate the data on the vacation hours. And that one’s a little more difficult for us to do if you remember we talked to council about the ability to hire individuals in with vacation that’s commensurate with experience versus years of service with the city. We’re working through a couple of components on that. And, and specifically, one of the things counsel said is how do we address it for individuals who have been hired and recently, and they’re working through some nuances in that? I wish it were less complicated, but we’re running into some interesting complications on how do you operationalize that. So they’re, they’re working on that piece. The other one that what’s the other one that’s coming forward? Joanne,
Unknown Speaker 42:18
what’s a 30
Unknown Speaker 42:20
inclement weather was another that we, we were working on in terms of how we compensate individuals, because we have a lot of folks that come in, and those were all things we were hearing from the organization.
Unknown Speaker 42:35
Part of it that interesting in this is,
Unknown Speaker 42:40
you know, there’s things that we’re seeing that you’re seeing connected into this that are directly related to it. You know, I’ve talked a little bit in my first presentation in terms of
Unknown Speaker 42:50
the police take home vehicles, that is connected to this. And it’s it’s, you have the issue of recruitment and retention embedded in this. But there’s also this component of of having your office there versus having to constantly move it. Obviously, we’ve been pretty aggressive in terms of work from home, and how we utilize that and we’re continuing to evolve and learn
Unknown Speaker 43:16
Unknown Speaker 43:19
They there’s a few other pieces as well. And you’ll see some of these see them, I think embedded throughout the presentation for budget. So for example, the Human Resources coordinator, that’s a project that Harold’s been spearheading with st train, to be able to bring in about 125 high school students to be able to start to train them in different areas that they’d be interested in in expose them to the city.
Unknown Speaker 43:42
Work From Home and also flexible scheduling, what we’re seeing in some of our competitors is that they’re both starting to roll that back, which is a great advantage for us. I think if we don’t do that, because it’s an interest for many of our applicants. And that may be something that we can use as a hiring advantage. So different pieces throughout, we may be missing a couple of things I know I’m Sandy just met with the whole workforce of the future team, which is kind of spread throughout the whole city. And we had a huge list of accomplishments that had come through and also some pieces that we need to work on next. So we can present them as we go through the rest of it, it just be helpful to highlight those these What is this is what we are learning or what we learned from and how it shows up in budget recommendation so it doesn’t get lost. Given the presentation we had 10 months we can we can add that on the 13th. And the one thing I want to do is give some really big kudos to the workforce of the future team and what you’re going to hear.
Unknown Speaker 44:38
This is a diverse group of individuals that represent all of our operational areas, or most of them. And so these are the folks where the rubber meets the road and really happy with what I’m seeing and they’re definitely challenging us, organizationally, which is good to see. I actually like it. It’s fun.
Unknown Speaker 44:58
Can I add the juxtaposition
Unknown Speaker 45:00
So councilmember waters, you were talking about how does the compensation play with the workload fate plays to the future. And what we’re finding is that it’s the combination of both right? Paying fairly, which is our compensation philosophy is making sure that we’re paying fairly to the market. And then in combination with flexibility and work from home options, or if you can’t work from home the option to have an inclement weather vacation day, if you’re the one that has to come in, and Snowplow, if you’re the one that has to be on call, that we’re paying additional for those kinds of services, if you take that piece, and then you also have our traditional benefits, which as you can see from what Gina said, pretty good as well. And we’re able to keep those steady as well. So if you have your traditional benefits, and now we have these workplace of the future benefits, and even includes things like ensuring that the workplace is very clean, you’ll see some of those kinds of things in this in this budget to make sure that people are staying home when they’re sick, that they have that flexibility, that ability to either work from home or flex their schedules. It’s really that whole package that we’re going for when we talk about total compensation, it really is total rewards, which is something that Gina has mentioned that I hadn’t thought of before. But it’s part of it compensation is one bit, but you combine that with the recommendations from the workforce of the future, which most of them have already been accomplished, we found out during our meeting as we check them off. And then you add the traditional benefits. And hopefully we have just a really stellar workplace for people to thrive in.
Unknown Speaker 46:22
Unknown Speaker 46:25
I think we’re ready for the next part of this presentation. So there’s a couple of things that we wanted to touch on.
Unknown Speaker 46:34
So we can go back
Unknown Speaker 46:43
to what you just did.
Unknown Speaker 46:47
So Jim and I were going to talk about this this section because
Unknown Speaker 46:52
obvious questions is, it’s different. This was negotiated last year during the collective bargaining process with police and fire. I wanted Jim to do just a quick refreshing on what was involved in this with city council. Because as you will remember, again, kind of taking the total compensation in total rewards. There were other things that were associated with this. And the biggest was really the movement into giving both our police and firefighters the option of moving into the FPA retirement plan, which is different than the plan that we had. So Jim, do you want to just quickly
Unknown Speaker 47:37
Unknown Speaker 47:50
Okay, so we’ll just jump around on this slideshow, but Mayor pack members council. So
Unknown Speaker 47:56
what last year we did negotiate a three year contract with both police and fire unions.
Unknown Speaker 48:05
Part of that key and part of that and key in us being able to get a three year contract was the addition of the opportunity for the active participants at that point in time to join FPA. They’re statewide fire and police pension Association, which has offers both a defined benefit plan which is like a pension and a defined contribution plan, or a hybrid plan, actually, which is similar to what the city maintained was a defined contribution plans for the for those members, that
Unknown Speaker 48:43
the results of that I’m going to go take you through right here. But the cost of that was more expensive than what the city’s plan was from a city contribution perspective. We were contributing 10% to their defined contribution plan. The 22 budget budgeted all of the those eligible employees at 13.7%. And by the way, any new employees after that point in time have to then go into the defined benefit plan for FPGA. So what we did at that point is really in a sense as we closed off participation in the city’s police and fire defined contribution plans.
Unknown Speaker 49:27
So the employee contribution requirement, previous to this year was 10%. That moved up to 12%. In all of these plans, yep. EPA in the city plan. The results of those have the votes to get in individual selections I should say on whether to go in or to NPPA or not. We’re in police. We had 109 members stay in the cities plan. 19 entered the FCPA defined benefit plan and another 19 entered the FCPA hybrid plan.
Unknown Speaker 50:00
In the fire 36 members stayed in the city’s defined contribution plan 18 entered the FCPA defined benefit plan. And then 37 entered the hybrid plan.
Unknown Speaker 50:13
So the contributions for 2023 for these plans, they’ve some of them a slightly changing, and we’ll change each year with a PPA. For all new employees, it’s a nine and a half percent city contribution, which is less than what we were putting in, in the old system each year, that’s going to go up a half a percent until it reaches 13%. And who knows beyond that that point, but that’s what they’re guaranteed through 2030
Unknown Speaker 50:40
reentry employees, these are the ones who were able to make the choice to go back out to go into FPGA in a defined benefit plan, the city’s contribution there is 11.4%. So again, greater than what we were are putting we’re putting in a 10% before and then in that hybrid plan.
Unknown Speaker 51:00
And as well as for the city’s defined contribution plan, because we want it to be competitive and match what their defined contribution option was. That is moving up or has will move is at 13.7 this year, and will be as well again next year at 13.7%. So you can see that the city was making a much greater
Unknown Speaker 51:23
commitment to pension contributions. Regardless of which of these selections those active members went into, it’s going to shift a bit after the first two years. So after 23 the FPA is charging us an additional contribution to
Unknown Speaker 51:42
kind of fun their defined benefits until they get a sense of, of what they’re really going to cost the PPA. And so they’re charging them a 1.7% premium and the hybrid plan and a 1.9% premium and in the defined benefit plan. And the city’s paying that in the first two years in full. Whatever that ends up being in year three and beyond we’ll we’ll share that with the employees. So these percentages will drop, probably in in 2024.
Unknown Speaker 52:17
We’re just wanted to show that that’s part of the reason why we’ve got set
Unknown Speaker 52:23
compensation amounts within the CBA for police and fire for both 23 and 24. Because we did get a three year contract, which both parties were willing to agree to add that
Unknown Speaker 52:38
because of the addition of the pension opportunity with a PPA, which, which was a big one on their part. So we just wanted to point out that being a additional benefit beyond their their 4% increase in a 23 budget.
Unknown Speaker 52:58
So anything else you want to talk about comp. Okay, are there any more questions?
Unknown Speaker 53:06
I think a couple of things I just want to throw in, if I can. So everything that we’ve just talked about as far as the compensation system, the 101, the exceptional pay. That’s all today. And we have no idea whether we’re still here next year, or whether we’re looking at a totally revamped system because we are asking these consultants to ship to show us what are the best practices out there. And we know that there are the entities that have much wider
Unknown Speaker 53:38
ranges than the city of Longmont does, and way different ways of moving people through their their ranges. And we’re open to looking at everything. And who knows what we’ll come back with next year. So that you may not we may not be calling it one on one on one or two next year or something like that. I think theoretically, that’s actually a great point, Jim. As we were talking to them, we actually had special sessions where we would jump in and essentially the request is this.
Unknown Speaker 54:08
Read the crystal ball, predict what’s in the future. Tell us where we need to be. Not what the traditional answer is, is here’s your benchmarks. Here’s your standard plan, here’s what you need to do. And so that’s really I think we can’t understate why.
Unknown Speaker 54:25
Really looking at trying to get a big three to come in and do this was important for us.
Unknown Speaker 54:31
In most of our funds are in the general fund 70 72% of our 71 Isn’t now
Unknown Speaker 54:41
feel that 70% 70% of our expense in the general fund is our people, it is the most important and then even when you look at the other funds, it is the most important asset we have as an organization. And that’s why we want to really look at this and look to the future. So
Unknown Speaker 54:59
if and when this one
Unknown Speaker 55:00
Hold hits us again, we’re gonna be in a great position.
Unknown Speaker 55:03
And then the final thing I wanted to add to I think you heard a little bit about this last week from the city manager with his comments about about, you know, hiring and trying to to chase the market. You know, we think we’re hoping that what we’ve gotten here with a 6% increase is what we’re, we’re calling it market, but we that’s based on the best data we have available. And we don’t think that that’s very strong data. So we don’t know if, if we’re really paying one on one, we just know, it’s 101 of what we have said as as market. And what this study will also do for us, hopefully is tell us did we come up ahead or behind or AT market, there is extra dollars, that are budgeted in the city managers contingency, if we have extreme situations where some positions may be way behind market, that we need to make adjustments sometime next year. So that we’re, you know, dealing with the retention issues that that we’re facing with compensation moving as fast as it is it this was,
Unknown Speaker 56:08
in the 10 years that I’ve been here, and seven or eight, or whatever it was in the previous city. So probably been the hardest year for compensation. And it’s because the world was moving so fast on us, even as we’re trying to figure out where it is we’re seeing holes developing the organization. And we’re doing real time benchmarks. And
Unknown Speaker 56:31
you know, for example, in our I think it was our level two engineers, we had to review that real time and had to make, I think it was a 10% adjustment real time. Because that’s how fast the market moves. We were seeing this in multiple places. So as we were looking at the data and coming in, and we talked about this a little bit in the opening, we heard 4%, we saw 4.1, we started going we need to do our own surveys, city started talking about some combination of 6%. And so the 6% was cities doing mid year adjustments, and then did projecting next year adjustment. And we’re like, well, that six and the city saying this and there were surveys going out for multiple, I think there was one on the financial side where they were asking HR was asking everyone was moving around trying to figure out what’s going on.
Unknown Speaker 57:23
We’re a little difference. And we’re different, because we have to give you a balanced budget on
Unknown Speaker 57:29
before the first of September. So we were taking this data, some of the numbers that we were getting from some of the organizations, they don’t necessarily have to do that. And the number they may come up with may be a little bit different as they’re moving through their budget processes. This is something we were talking about today trying to
Unknown Speaker 57:49
to wrap our mind around this. But what we’re saying is based on what we saw, we think this is it. Now to put it in perspective, I think this is the largest increase that we’ve seen in compensation and
Unknown Speaker 58:00
how many years
Unknown Speaker 58:03
I can’t remember
Unknown Speaker 58:07
it and we’re sitting there going,
Unknown Speaker 58:11
we’re pretty sure this we hope this is good. And in, we’re going to bring the experts in to tell us and we’re putting more money because that’s how fast the world is moving. And,
Unknown Speaker 58:22
and so I just wanted to give you all that perspective, because that delayed us to at least two weeks in the budget process, putting it together, just trying to get our arms wrapped around the compensation piece.
Unknown Speaker 58:37
And actually did have one final memory that I needed, we wanted to put out there that we do know that we have some errors in the proposed pay plan that was presented to you last week as part of this. So we’ll get those corrected.
Unknown Speaker 58:54
We just found some today. But our intention is to have in the final budget, the corrected amounts for that. So we’ll probably be bringing that to you towards the end of the month.
Unknown Speaker 59:06
So with that, unless you have other questions on pay, I’m going to jump into the pension the rest of the pension benefit presentation. So I do have one question. And just when you’re talking about 101% of market value, when we’re looking at new hires to fill some of the positions that are very difficult to fill, are we are we offering market value for those employees or you know, as a incentive or above market value to get some of those positions filled.
Unknown Speaker 59:37
So we above above market is exceptional pay so we can move up to market and we have a pretty this is what Jim was saying we have a pretty narrow range. It’s what 99 D 290 to 108. And so when we hire someone based on their skills and expertise,
Unknown Speaker 59:57
we can move them up to more
Unknown Speaker 1:00:00
If it’s somebody that’s coming in with a pretty robust skill set, or you can say we’re not, you know, depending on the skill set, then this is really getting into the individual, sometimes you can go, we want to start you at 95. And six months, once you get out of probation, you get up to a 5% Bump. So then you can go from 95 to 100 youth, with special permission from the City Manager, you can move up to market. And so we’re really looking at that as on an individual basis. And so there are times when someone is hired, where they do bring them in at market based on that skill set and to be competitive with,
Unknown Speaker 1:00:36
you know, the world around us. Okay, thank you. And if I could just add to that, we have had very exceptional cases where we needed to go over 101 If there was a critical need in the organization, but it’s, it’s rare. Okay.
Unknown Speaker 1:00:51
I guess whatever it takes.
Unknown Speaker 1:00:54
Alright, so I’m going to move into our defined benefit pension plans.
Unknown Speaker 1:00:59
This is a reminder, we have three defined benefit plans. Two of them are all closed plans for one for police, one for fire, have less, I think nine or less in each of the two plans, either retirees or beneficiaries remaining in those plans. We do have a study, an actuary study done on each of our defined benefit plans each year to see where we’re standing. And what what our unfunded liability is if one exists, and whether we need to change our comp contributions to those plans or funding. So those are done during the year as of the first of that year. So our last study was as of the first of 22, two in January 1 22. And we received the results of that last month from our actuary receive it actually during the budget process, but the board actually receives the the report in their August meeting. So we have for the two old hire plans that will hire police plan has a negative unfunded liability, which then senses a surplus of $182,000. That’s 117% funded, the old hire fire plan has a negative unfunded liability of 536,000, which is means it’s 121.4% funded. So those both grew over the last year, or through the end of 21, I should say. And 2020 and 2021 were very strong investment returns for our defined benefit plans.
Unknown Speaker 1:02:46
So there’s no city contribute bution required for either one of these plans.
Unknown Speaker 1:02:52
The general Employees Retirement Plan, of course, this is an active plan. So we have new employees coming into it, the amount of the the
Unknown Speaker 1:03:03
participant base changes over time, there’s a whole history of this within your budget message, I’m not going to take you through the whole detail. I will say that and it’s it had a history of being fully funded until 2009 After the
Unknown Speaker 1:03:20
economic downturn of 2008. And so since that time, we’ve been trying to do what we can to try to move it towards being fully funded. Whereas at the same time, you know, we’ve we’ve increased contributions over the years. But we’ve also made changes in in the plan benefits to try to bring back down on costs. But additionally, just last year, we made some changes in assumptions that, in a sense, increased our unfunded liability, but were more realistic assumptions. And so something with them, the plan was kind of behind the curve on putting those assumptions in place as far as our discount rate and mortality rates. So
Unknown Speaker 1:04:05
key here with the current plan is that it has not had a benefit increased cost of living increase since the since 2009. And since the point in time where it went on funded, and we used to do that, usually every three to five years. So haven’t had it in quite some time and can’t under Tabor unless it’s fully funded. So we’ve been trying to aggressively move it to fully funded. These are some of the changes I talked about. So I’ll jump through that. Our funding policy is that we’re amortizing the unfunded liability over 24 years from January 1 2021 kind of rolls up each year. But in the sense we’re looking at 2045 before this plan is fully funded, so it’s not an ideal situation.
Unknown Speaker 1:04:57
When looking at at our gains and losses
Unknown Speaker 1:05:00
Obviously, last couple of years. And you know, over time, you’ll you’ll see all sorts of volatility and returns, you’re certainly under, you’re aware of what’s going on in the market here in 2022. So we’ve had two strong years that preceded 2022. And all the data that I’m giving you now is through those two strong years, and doesn’t include anything that’s happened here in 2022. But you can imagine it’s, it’s not going to certainly put us in a better position. But we put that those losses if we stay in the last position, I’ll keep your fingers crossed over the next four months. But if we stay in that position, then that will be smoothed out over five years as well.
Unknown Speaker 1:05:45
So we reached an unfunded liability of 30 point 6 million at the beginning of this year, which was down from 37 point 2 million, and we reached 86.3% funding. Again, of course, the goal is to get to 100%. Our contribution requirement decreased from 15.85% to 14.86%. of compensation. This year, we’re not changing our contributions in the budget of the city is still going to contribute at 9% employees contribute at 6.6%. If they were here anywhere in time before 2012 and 5.6%. For employees subsequent to then those are, since we made changes in the in the benefits for for new employees, they make a less of a contribution as a result.
Unknown Speaker 1:06:41
So this is what we talked about already about the police and fire. And then you already heard about the health benefit fund changes, or at least our benefit changes from Gina from the fun perspective, overall, our experience with Kaiser
Unknown Speaker 1:07:03
with the 4.61% decrease that we’ll be seen next year, we’ve had a 3.72% aggregate blended premium increases since we joined Kaiser, which is really a good performance. Good experience for the city along map our contributions to the health benefit fund in this budget, as a percentage of pay the city contributions are going to drop from 16% to 15% of pay that and that will in doing so we will still maintain about a $9 million fund balance in our health benefit fund. Besides paying for the claims for medical and dental and the other benefits that Gina went through. Some of the smaller benefits that we pay out of this fund include some wellness costs at 32,000 is a projection of how much that might be next year $50,000 For police and fire physicals and another 50 for public safety counseling. So again, in your packet for tonight at the show to pro forma that shown our projections of what’s going to happen with this fun in in 2022 and 2023. And again, we should be maintaining even with a decreasing contribution will be about a $9 million fund balance which is which is why we are reducing the contributions because we don’t need this to build up higher so
Unknown Speaker 1:08:31
and I think that’s it for our presentation and we unless you have questions for me on any of that
Unknown Speaker 1:08:42
seeing no questions
Unknown Speaker 1:08:46
Councillor Martin Are you
Unknown Speaker 1:08:53
okay, we have one more budget presentation, but it’s up to you all.
Unknown Speaker 1:08:59
Do what what would you like do Okay, let’s take a three minute break
Unknown Speaker 1:09:05
Unknown Speaker 1:09:31
Sure, gonna get it on
Unknown Speaker 1:12:55
We’re ready to resume the meeting
Unknown Speaker 1:13:06
you got that? And I get this. Yes, Valerie, can you hear me? I can. Can you hear me?
Unknown Speaker 1:13:14
Okay, it’s not showing, Oh, give me just a second. I can see it on my end
Unknown Speaker 1:13:25
I’ve got beautiful charts. I hope they can see them
Unknown Speaker 1:13:39
she can hear you now if you want to ask her to
Unknown Speaker 1:13:47
just say when
Unknown Speaker 1:13:54
we’re ready for you, Valerie. All right, thank you, Mayor. So Mayor Pat Peck and city council members, Valerie Dodd, Executive Director of next fight. I am here remote today because I am, I think a little infectious and not in the good way, the bad way. And I am thankful for workplace flexibility. So thank you, Dallas and team for accommodating me remotely today. So we will start with what I like to do is the really the current situation so you are free to advance Dallas, if you can. All right, thank you. So the current situation really helps us understand what we’re trying to achieve and accomplish as we look toward the next budget year. And where next slide is sitting today is that we have good sales, we have good revenue, but things are starting to slow. We’re starting to really finish our initial build. We’re at 91% build of the community. We have over 60% Penetration over 25,000 customers. So we’ve done most of the hard work, but you know what? I don’t think I’ll be happy to
Unknown Speaker 1:15:00
We have 70% penetration. And I also know that there’s about 8000 households in this community that have never had an X light service. And I just think that’s really a shame. We have, you know, free service for income qualifying households. And we have terrific speeds on the high end now offering 10 gigabit. So we certainly have a little bit more headroom, but I want to make sure we realize that. The next is we do have those new services I just mentioned, 10 gig. So that’s a new service, we have new Wi Fi, six and some other things that we really want to make sure that we promote to our existing customer base so that they have all the solutions they need. And also, I want to make sure we promote those so that we can continue to grow. Additionally, our competition is getting, I think, pretty desperate in the marketplace, and is throwing out a lot of aggressive offers. And so I want to make sure that we are competitive in that space as well.
Unknown Speaker 1:15:52
The network is in great shape, by far the best network in town, but it does require a lot of maintenance. Also, we have to continue to keep our bandwidth and our capacity at adequate levels to future proof the network, we also need to continue to expand with the city. I think we all know the city has grown at about 1% a year. And we’ve got a lot of NVQs, or multiple dwelling units in the hopper. And so that means a lot more apartment buildings forthcoming that we’re going to need to build into as well. And then lastly, I think we all know as we’re probably most of us are Amazon consumers or Nordstrom shoppers. And we all know that the customer experience is continuing to become more automated, more simplified, more intelligent, and we need to keep up with customer expectations of their experience in their interactions with Next slide. So next slide. Given the current situation, what is really our focus for 23, it’s the same as it’s been for the last seven years. But it’ll continue to be the same how we approach it will be different from year to year. But the focus is really to attract and delight customers. And the difference with satisfying and delighting customers is delighted customers will tell their friends and neighbors and help sell for you. So that’s certainly what we plan to do, we plan to do that with a more sophisticated marketing plan than we’ve had in the past, a little more investment on the marketing front. also continue to invest in our highly reliable and fast network. And then lastly, really ensure that we’re being customer centric in all decisions and transactions. And that means implementing a new software platform called CRM, which stands for customer relationship management. So next slide, and I’ll go into a little more detail about those three key categories of focus for us from a sales and marketing perspective. As I mentioned, we need to do a little bit more, because we have more customers still to get, we don’t want things to slow too much. And we also have cool new products that we want to market to our existing customers. So for one, we’re going to be doing quarterly acquisition campaigns to our existing customers, as well as to new customers, we want to make sure everyone has access to great value. Also, we recognize a lot of people are coming in and out of town. And so believe it or not, not everyone knows who next slide is. So we are trying to invest in a little more brand advertising. And you may have seen some outdoor boards on the outskirts of town lately.
Unknown Speaker 1:18:14
On the fast, reliable network, nothing too particularly new here. But this is just my investment because again, it’s bandwidth. It’s backhaul, it’s the connection to the internet, it’s the redundancy to ensure if there is a fiber cut that we do have a way to reroute the traffic. And then lastly, the customer experience. I alluded to that CRM platform, Salesforce is the platform we will be using, it is the best out there. And it has a ton of capability that we will be initially using for the purpose of next slide and our marketing efforts. But down the road, we think we can expand that to the balance of the city. So that we have a unified database that really helps us understand our customers in the transactions and an interactions we’re having with them.
Unknown Speaker 1:18:59
Next slide, please. So price tag, what’s all that going to cost me? So I talked about some of our key focus areas. So the marketing probably going to spend about $500,000 in marketing. In the past, we’ve spent probably $400,000 And the general gauge in this marketplace for not marketplace, but this I guess market space rather, is to spend three to 5% of your recurring revenue on marketing. We are just under that 3%. So I feel like the $500,000 investment is certainly well suited for us. The fast reliable network three to $4 million. So it’s a big ticket item but again, it’s our long haul. It’s our transport it’s redoing some of the fiber plant that may not be as staying up to the standards we so wish and also it’s undergrounding some of the areas that we have where we have a fair number of rodent chews causing some onesie twosie outages. And then lastly on the customer experience front
Unknown Speaker 1:20:00
That CRM platform has been partially funded this year and then partially funded next year, a lot of the expense is the upfront fees, and then also the carrying cost of those licenses. And then we have in the budget, just one new incremental FTE and it’s for a digital navigation manager. And that position really is there to help us further penetrate our broadband further penetrate our Wi Fi six and making sure that people are using the Wi Fi six application to help manage all of their smart devices within their home. So it’s really about enabling the, I guess, the smarter technologies that connected home concepts. So that person will help do that. And they may also serve as a project manager over some of the smart city initiatives, not just smart home initiatives. So I know Dr. Waters is gonna say, Valerie, what are you going to give me for that FTE. I do not have hard in specific numbers. But we will know it was wisely invested when we have an increased penetration of broadband into some of those households that haven’t typically had broadband at home. Believe it or not, there’s about 11% of Longmont households that still do not have a connection at home. And so knowing that we can provide free service to many households, that’s going to be a real focus. And then also making sure that we have good adoption, again, of the Wi Fi six complementary service that provides a whole home solution, and then helps people manage really the technology within their home.
Unknown Speaker 1:21:29
So okay, that adds up to roughly $5 million, right? Well, my budget I’m asking for is $20 million. So where am I spending the rest of this budget. Let’s go to the next slide and see. So this excludes the CIP I’m treating that separately. So we’re spending roughly $17 million at cross generally equally across the three categories of personnel went in, and then capital and non operating. So on the left hand side, you can see on the personnel, if you follow the big blue bar down salaries and wages, no huge surprise, operating and maintenance, that is mostly on repair and maintenance, which is really again, the bandwidth, the backhaul, a lot of that colocation expense with actually having the infrastructure of our network, and then we have some Pro Services, which would be maybe our billing system or our advertising agency, etc. And then when you look at the capital of non operating the vast majority, or majority, or $5 million of that is for debt. And then you have a little bit around machinery and equipment, which again, is just really helping us maintain the network in the infrastructure of that. So what are the trends looking like in these categories, we will flip to the next slide and see. So first, let me explain I had three categories. on the earlier slide, I combined the last two categories, because we did have some shifting of expense. And I wanted to normalize that so that you can see how it came out in the wash. And so while I’m speaking about that, the Oh nm and the capital non operating, when you look, over the course of the few years, we’re really looking at flight expenses, over 22. And then when you look at the total personnel, there’s just a slight bump up again, you just heard about the 6% increase in salaries, and then also the one additional FTE, so that’s causing a little bit of incremental expense in the personnel category.
Unknown Speaker 1:23:26
Next slide, please. So now we’ll talk. I’m sorry, no question. Okay. So we’ll talk about capital very briefly, because Dennis covered this last week. But just a reminder that we are spending almost $4 million in capital it is down from last year. And most of that is going towards fiber installation and fiber construction, when we’re putting in a brand new fiber drop into a household that is considered capital. And so we still have lots of households we still need to sell into. And so that carries with it some some big expense, but it’s a one time investment. And then on the construction side that mostly relates to the new apartment builds, and then maybe the occasional road move or other capital projects outside of our area. And then what’s the trend on Capitol next slide, I already alluded to it, it’s down just a little bit favorably.
Unknown Speaker 1:24:21
And so again, you see how the dollars are split across the categories, its construction and new installs, and the trend has been coming down. And that is due in large part to the fact that we’re not building out like we used to be we’re your seven and 91% built, as I mentioned earlier, so we don’t have nearly as many brownfield or Greenfield new builds as we have in the past.
Unknown Speaker 1:24:44
So next one, please. So okay, I just spent $20 million. What do we get for that investment? It’s an important question. And we will go to the next slide to answer that. We’re gonna get customers, we’re gonna keep customers and we’re gonna gain customers. So we were
Unknown Speaker 1:25:00
hoping to end 2023 with 27,000 customers. And so today we’re sitting at 25,000, I think 83 customers. And again, we will be adding several 1000 in order to net, the roughly 1500 customers to get us to 27,000. And so, for one, we’ll be doing that with our bulk MDU agreements that we have. And that is where we will sign up and apartment or condominium, will sign up with the management agency provide a discounted rate, if they sign up all of their 100% of their units with us and include that in the rent or the HOA fee, or what have you. And let me make sure people understand that we’re not keeping other carriers out. So if a resident of any of these apartments wants to sign up with Sir, for service with another carrier, they are free to do so. But we’re just providing an incentive and an added value to that particular apartment, or building facility to include a really great discounted rate for one gigabit internet.
Unknown Speaker 1:26:03
Excuse me. So on the chart on the right, you see that blue bar, that is our customer account, as I mentioned, it’s going to go to 27,000. And then it’s basically going to flatten out as we continue to really hit really high penetration numbers. The red graph shows our growth rate. So we’ve been growing at a really high clip 8% plus year after year, but we know that that’s starting to slow and we wanted to make sure we factored that into the budget.
Unknown Speaker 1:26:32
So that we didn’t get into
Unknown Speaker 1:26:35
an unforeseen situation financially. So we’ve been conservative in our approach about the growth. And we still have wonderful financials, which you’ll see in just a couple slides. Also, no sorry, okay, tickle.
Unknown Speaker 1:26:48
Also know that our customer account will be growing at a higher rate than our revenue. And that’s because we’re continuing to bring in more customers on the low end, which have a lower ARPU, which is average revenue per unit. And so many of those income qualifying customers, we’re getting maybe $30 For instead of a 50, or 60.
Unknown Speaker 1:27:08
And that’s a good thing. So we’re happy, happy to have those customers. Also, when we get these indie book deals, we get 100% of those customers, which is great, but at a lower cost. And so that’s why you’ll see the revenue not quite keeping up with the customer growth. But that’s a good thing, because we want to sell into all households, regardless of their ability to pay for a $70 gigabit service.
Unknown Speaker 1:27:33
Next slide, please. So those customers, we love having customers, but we also love having the revenue associated with them. And the preponderance of that revenue comes from a gigabit residential internet, no surprise, you see that there in the pie chart on the left. And then on the right hand side, as I just mentioned, that the revenue is declining, has been, you know, in excess of 8%, we’re really estimating just about a 3% revenue growth year over year. So again, thinking that we’re being conservative, but also putting a stretch goal on ourselves to make sure we continue to drive for growth.
Unknown Speaker 1:28:07
Okay, next slide.
Unknown Speaker 1:28:11
Okay, so I spent $20 million in expense, I’m promising $20 million in revenue. So what does it look like together, and on the next chart, you’ll just see, what I love is a waterfall chart. So you can kind of see what’s coming in and what’s going out. So you see that revenue in the green on the left, and then you see the chunk of salaries coming out. And then that network and marketing, most of that is networking. So don’t think, again, we’re only spending $500,000, not 5 million on marketing. And then you see the debt, which is a huge chunk of our expense. And then the CIP in the bottom right hand corner of roughly $3.7 million. So it’s a balanced budget. And we didn’t really have to manipulate anything. To get to this, we did have to cut a few expenses and back off some of the testing tools that we had on the network side. But we were able to bring this in and feel confident with the numbers.
Unknown Speaker 1:29:05
So next slide will show what it looks like for the next 10 years. And I love this chart, I’m really going to love it and seven years. So let’s start at the top, the blue line, the blue line is really the revenue, which I just mentioned, is going to kind of grow a little bit and then flatten out. That’s great. The orange is our operating expense, which will kind of continue on pace until we pay off that $5 million a year expense. And so you’ll see the large drop there in the Orange Line, which is great. And then the gray at the bottom is the CIP expense that will slowly decline over time as we continue to reinforce fortify and rehab our network. And then the probably most important chart or part of this chart is that yellow bar, which is the bottom line, the Indian working capital and you see that obviously spike hockey stick on the right, and 2029 again after we retired
Unknown Speaker 1:30:00
The debt. And then if you look further to the right, you see that there’s a bunch of
Unknown Speaker 1:30:05
cash coming in, that we will reinvest in the network as well as back into the city.
Unknown Speaker 1:30:11
So next slide is my summary. And all in all things are good. But we aren’t going to take that for granted, we’re going to continue to fight for new customers and fight to keep our existing customers but really investing in a great customer experience.
Unknown Speaker 1:30:24
Really, I think a lot of the things are starting to scale in the business. So those expenses are coming down. And I don’t know that we’ll have to reinvest or grow too much more to maintain the operation that we have for the next 10 years or so. And obviously, once we pay the debt off, we’ll be in really good shape. And we are, you know, making sure, though, that we’re spending the right amount of money to again, strengthen the network to ensure that is future proof so we can continue to provide the quality service that we do today. So thank you, and I look forward to any questions you may have.
Unknown Speaker 1:31:02
Any questions? I don’t see any. Thank you very much, Valerie. That was a great presentation. I like your waterfall graph as well. It’s easy to understand. Yeah, it’s my favorite chart. And it’s a click on Excel. It’s a wonderful thing. Thank you, Mayor. Thank you, council members. I appreciate your support. Thank you.
Unknown Speaker 1:31:27
So Harold, where are we on the budget? This is it for budget. The next item, okay.
Unknown Speaker 1:31:38
Are there and that’s our utility rate studies. proposed rates. Is there any more? Is there any questions on budget or anything council wants us to bring back the
Unknown Speaker 1:31:49
you thought about since last week’s presentation and then this week’s
Unknown Speaker 1:31:56
I think just the things that Councillor waters wanted more in depth on the future work force or workforce of the future. That’ll come next week Great.
Unknown Speaker 1:32:38
Good evening, mayor and council. We’re here to talk about the next step in the rate proposals that we spoke about initially in in June have provided some information about
Unknown Speaker 1:32:51
the cost drivers that have occurred since then. So we’ll go through the proposed rates for both electric and wastewater and then look for your feedback.
Unknown Speaker 1:33:11
Good evening, Mayor Peck members of council. My name is Brian McGill utility rate analyst with strategic integration. And as Becky just mentioned, back in June, Raven gave a presentation informing counsel that staff was performing cost of service studies for both the electric and wastewater utilities. And tonight rave and I are here to present the results of those in the proposed rates associated with those costs of service studies.
Unknown Speaker 1:33:44
So this is our agenda for tonight. I’ll start off the presentation by reviewing the electric rate proposals, then I’ll hand it off to Raven for the majority of the presentation. And she will start with the wastewater costs of service results and proposed rates and then she’ll move into how these rate proposals will impact the average residential utility bill on a monthly basis. And then she will also discuss the assistance programs that are available for our customers to take advantage of including the Longmont cares monthly rebate program. And she will also be presenting the changes for that program associated with the electric and wastewater utilities.
Unknown Speaker 1:34:31
Then she’ll talk about the community outreach efforts that we are performing and then we’ll finish up the presentation with council discussion questions and direction for staff to move forward with rate proposals.
Unknown Speaker 1:34:48
Okay, so before I get into the electric utility, I just wanted to note that in 2021, staff did perform a cost of service study for the electric utility and can
Unknown Speaker 1:35:00
So approved electric rates for 2022 and 2023. And rate proposals that I’m presenting tonight will be in addition to those rates that have already been adopted.
Unknown Speaker 1:35:13
So the first two items on the slide have to do with rate structure and the rate philosophy behind that structure. And so currently, our electric customers, every rate has a monthly customer charge, as well as a per kilowatt hour energy charge. And a few of our rate classes do have a per kilowatt demand charges well, and then all of our self generation customers do have a rate element for our generation credit. And they receive that credit for all the kilowatt hours that they produce and push back on to our electric grid. And currently, that rate is set at the retail rate. So they get paid back the same amount that they pay for the energy they pull off of the grid. And so we’re not proposing any changes to those rate structures. Oh, another element that we have for all of our residential and commercial customers is a seasonal rates. And so how that works is during the for summer months, June, July, August and September, the electric rates are higher than they are for the non summer months. And the reason behind that higher summer rate is so that way we can recover the increased costs associated with generation and distribute distribution of the higher energy that’s demanded during those four summer months. And so again, we’re not proposing any changes to the rate structure at this time.
Unknown Speaker 1:36:43
And then what I mean by rate structure philosophy is, in 2021, when council approved and adopted the rates for 2022, and 2023, the way we applied those increases was we put 100% of the increases into the energy charges for the customers. And we left the monthly customer charge at the 2021 rate. And by doing so, we’re trying to give our customers as much control as possible over the actual percentage increase that they would see on a monthly bill. And so the way that works is if if a customer is able to use less energy than the average customer for their rate class, and they would actually see a lower percentage increase than the average customer would by controlling the amount of energy they’re using on a monthly basis. And so we’re proposing to do the same thing, this time to add 100% of the increase into the energy charges and leave the monthly customer charge flat.
Unknown Speaker 1:37:48
Okay, then I’m going to talk about the major factors contributing to the electric rate increase.
Unknown Speaker 1:37:55
And then we’re also proposing an increase to the monthly electric rebate through the Longmont cares program. And Raven will talk about that. When she gets to that section of her presentation, we are proposing a significant increase to that rebate on the electric side. And the goal there is to try and cover the majority of the projected average monthly increase for our residential customers to qualify for that program.
Unknown Speaker 1:38:28
Then I’ll finish up the electric portion of the presentation by talking about the future electric rate analysis plans.
Unknown Speaker 1:38:39
Okay, so now I’m going to talk about the major factors that are driving the increased revenue requirement for the electric utility. There’s two major factors contributing to this increased revenue requirement, the first being an increase of the wholesale energy costs from Platte River Power Authority. And you’ll remember that last month, PRP a staff came and gave a presentation and they talk to you guys about this. And so what we’re what PRP is proposing is an actual 5% rate increase for 2023 as opposed to the 3.2% increase that we used when we did the cost of service back in 2021. And so there’s couple factors going into that increase from 5%. Yeah, from 3.2% to 5%.
Unknown Speaker 1:39:31
One of the major factors is the
Unknown Speaker 1:39:35
the change in the resource plan, when they had originally done that they had
Unknown Speaker 1:39:42
to meet our 2030 renewable goal they had proposed bringing on all the renewable sources in 2030. However, when they have updated that plan, now they are projecting to bring those renewable sources on two years earlier and 2028. And so
Unknown Speaker 1:40:00
We’re actually in 2027, as well.
Unknown Speaker 1:40:03
By doing that, they’re giving themselves the opportunity to
Unknown Speaker 1:40:10
make sure that the operational experience is the way they think it will be prior to actually closing the coal fired generation facility at Rawhide.
Unknown Speaker 1:40:21
And then the other factor going into the increased wholesale energy rate from Platte River is the inflation that the entire country is experiencing. So as you can see, the increase from 3.2% to 5% is contributing
Unknown Speaker 1:40:39
almost one and a half million dollars to our increased revenue requirement. And then the other major factor is just the inflation that Longmont power communications itself is experiencing, we’re seeing higher contracted labor equipment material costs all the way across the board. And that’s, that’s requiring an additional slightly over half a million dollars worth of revenue requirements.
Unknown Speaker 1:41:04
So if you look at the chart, you can see the total additional revenue requirement for 2023 is slightly over $2 million,
Unknown Speaker 1:41:13
which equates to an average rate increase additional rate increase of 2.3%. And I’ll get into the rate class by rate class breakdown in a couple of slides.
Unknown Speaker 1:41:27
Okay, so I pulled this slide straight out of the presentation that Platte River gave, it’s just a visual representation of the changes that they’ve made to the resource plan. You can see the purple line shows the original plan included adding all those renewable sources in 2030. Whereas now the blue line shows adding about half those and 27 and then the remainder of those in 2028. And another benefit of doing this though, besides the ability to get the operational experience is it actually increases the reduced cumulative carbon emissions by approximately 5.5%.
Unknown Speaker 1:42:14
Okay, this is just a slide showing how Platte River, how Platte rivers wholesale rates compared to the other regional providers.
Unknown Speaker 1:42:23
And based on this chart, Platte River has 18% lower rates than the next lowest regional provider. And by us being able to purchase our power from Platte River us and the other owner communities, which include Longmont, Fort Collins, Loveland, and Estes Park, all for those utilities. Because of the low wholesale energy cost, you’re able to keep our rates among the lowest in the state of Colorado.
Unknown Speaker 1:42:54
Okay, so this chart shows the actual percentage increases by rate class. And so in the previous slide, they said the average was 2.3%. As you can see, it varies rate class to array class. And that’s all based on how much each of the array classes contribute to the overall city peak demand and as well as how they actually use the distribution system. And so the top three rate classes are residential classes, and you can see that we’re proposing an additional increase of 2.1% for the residential classes. And then the next three classes are a commercial classes, and the proposed increases there vary from 2.2% to 2.6%. One other note on here is the bottom to the general fund classes. You see those are only 1.8%. And that is because based on municipal code, the general fund electric rates are designed only to recover wholesale energy costs. And so that 1.8% is the difference between the 5% and the 3.2%.
Unknown Speaker 1:44:05
So then, there’s a class I just want to talk a little bit about the residential energy class, the top one because that encompasses 92% of our total customer base, by far and away the largest class that we have. And you can see there the 2.1% for an average customer who uses 700 kilowatt hours a month, that’s going to equate to a average monthly increase of $1.61. Again here though, is by putting all that charge into the energy charges, if a customer is able to use less than that 700 kilowatts in a month, then they will see a lower than dollar 60 Charge and which would equate to a less than a 2.1% increase.
Unknown Speaker 1:44:58
Okay, then I’ll finish up the electric Porsche
Unknown Speaker 1:45:00
To know the presentation, just by talking about future electric rate plans. The one thing I know for sure is that in 2023, staff will be completing a cost of service study to set rates for 2024. Due to changes in wholesale energy and operational costs, we might be potentially doing annual studies for the next couple of years. There, the thing that we’re going to be working on is gathering usage data from the AMI implementation to inform future rate structure changes. And then the final item here is
Unknown Speaker 1:45:38
the electric Community Investment fee. Staff is hoping to bring back updates in either October or November for that.
Unknown Speaker 1:45:48
That was another thing that Raven had talked about at her June presentation is bringing back changes to our system development fees for water, wastewater, storm drainage and electric. And so this ECF, that’s the electric system development fee. And so the system development fees are fees that are charged to the developers and they pay those
Unknown Speaker 1:46:12
as new and redevelopment happens within the city. And the reason we charge them a fee for that is because then we’re able to keep those type of expenses for expanding the system to handle that new development out of our customers rates. And so that’s the philosophy behind that is development pays its own way.
Unknown Speaker 1:46:35
Okay, now I’m gonna pass it to Raven to talk about the wastewater utility. Thank you.
Unknown Speaker 1:46:51
Good evening, Mayor Peck and members of council I’m Raven Martin, Business Analyst with strategic integration. In the previous council presentation for the rate study for wastewater, we provided information on the current state of the fund and discuss the primary drivers necessity necessitating performing a rate study.
Unknown Speaker 1:47:11
In this presentation, I will discuss the revenue requirements for the sewer fund provide additional information about the primary cost drivers, as well as how PNR Pw and our staff created a prioritization matrix for this rate study to identify the highest priority projects and discuss funding sources for capital projects including grants and debt service options. This presentation is only about the wastewater rate schedules, the system development fees is a separate independent rate study which I will be presenting in the upcoming months.
Unknown Speaker 1:47:51
PW nr is proposing a rate increase using a three year rate schedule, and I will be presenting for rate alternatives as well as information on rebates for qualifying residents.
Unknown Speaker 1:48:08
After the last presentation in June, Pw and our staff met to take a detailed look at the projects that are the highest priority for funding in the next five years. We looked at updates to costs due to inflation, as well as determine which projects could be delayed. The result of this prioritization matrix was a list of projects determined to be the highest priority, and the total is represented in the following slide for revenue requirements. Primary among the infrastructure costs for wastewater is digester number four, a new anaerobic digester to increase capacity and redundancy of the existing process.
Unknown Speaker 1:48:48
This project at the wastewater treatment plant will allow existing infrastructure to meet the changing needs of the community and protect protect the and protect and conserve long months Natural Resources and Environment. The estimated cost for digester number four is over $19 million.
Unknown Speaker 1:49:06
Then there may be the option for additional debt service for this project in 2025. With voter approval
Unknown Speaker 1:49:13
on a proposed bond issuance of 19 million to complete improvements to digester number four. Annual debt service payments for this bond proposal would be approximately $1.5 million.
Unknown Speaker 1:49:26
Another major factor is increased regulation. The state enacted regulation 85, which calls for more stringent water quality standards for total inorganic nitrogen and total phosphorus, which require new or modified treatment processes. This includes the design of a new chemical removal system and designed for this began in 2021. With can construction anticipated for 2023. The city’s 2018 discharge permit is currently on a compliance schedule and is set to expire in September.
Unknown Speaker 1:50:00
of 2023. However, as regulations are becoming more stringent, we are anticipating additional compliance regulations which are currently evolving.
Unknown Speaker 1:50:09
Improvements to the wastewater treatment facility will meet water quality standards, extend the life of the plant, improve operations and reduce operating costs.
Unknown Speaker 1:50:19
And another major factor is the significant inflation occurring across all sectors, which has impacted the cost of providing utility services. Due to increased costs. For wastewater there has been a significant increase in the cost of treatment, chemicals, fuel and metals essential to providing the service. Also, the city’s wastewater collection master plan presented to council last year determined that approximately 8% of long months sewer lines are undersized for existing growth. The priority list includes a $17 million investment in asset management of wastewater infrastructure between 2023 and 2025.
Unknown Speaker 1:50:58
With digester number four, it will be covered by debt service payments as mentioned above, the city’s current wastewater rates were adopted in 2017 on a three year rate schedule, and have remained at the same rate since 2020.
Unknown Speaker 1:51:14
This has been insufficient to cover the costs of needed maintenance since then, and operating costs or satisfy the infrastructure needs for future growth. There are also significant risks associated with delaying replacement of key wastewater system assets. And a rate increase will allow the wastewater utility to continue work to improve and maintain our wastewater drainage system.
Unknown Speaker 1:51:47
In addition to generating revenue through rates and system development fees funding is also available through other funding sources. With voter approval, utilities can issue debt to spread the cost of infrastructure improvement over time. However, council has the authority under Section 10.2 of the charter to issue revenue bonds in an amount up to one half of 1% of the assessed valuation of the city without going to a vote. There is also federal funding and state grants such as the inflation Reduction Act and the bipartisan infrastructure law. Funding for these is becoming available over the next several years, and staff is actively looking for funding opportunities as they arise. One recent example of a grant received through the Colorado Department of Public Health and Environment for P FOSS also known as the forever forever chemical, which will assist in testing ground surface and water treatment infrastructure for these chemicals.
Unknown Speaker 1:52:50
This slide outlines the total proposed funding of the wastewater fund for 2023 through 2025, including operating expenses, existing and proposed bond payments, capital expenses, and change in fund balance. This table demonstrates our plan to use existing fund balance towards funding projects to offset the increases that our customers would pay. revenues generated through potential rate increase would be used only to fund projects identified with the highest priority. Staff is proposing a $19 million issuance of additional debt to help cover the cost of digester number four construction. And this is illustrated in year 2025. A bond election would be required for that and would increase the revenue requirement by just over $1.5 million each year beginning in 2025.
Unknown Speaker 1:53:48
All right alternatives that I will be presenting will sufficiently achieve the desired revenue to fund those high priority projects previously mentioned. Currently, metered water users are charged a monthly service charge plus a volume charge. Alternative one will maintain the current rate structure, but increases the rates only in in the metered volume charge which is highlighted in blue.
Unknown Speaker 1:54:18
Alternative two will also maintain the current rate structure but rate increases are seen in both low monthly service charge as well as the metered volume charge. Both rate alternative one and alternative two will sufficiently achieve the desired revenue. But alternative two is recommended because the increased rate amount in the monthly service charge could be offset by a potential addition of a wastewater rebate to the Longmont cares program.
Unknown Speaker 1:54:51
As mentioned previously, council has authority under Section 10.2 of the charter to issue revenue bonds in an amount up to
Unknown Speaker 1:55:00
One half of 1% of the assessed valuation of the city. This slide outlines the total proposed funding of the wastewater fund for 2023 through 2025, including the $6 million bond issuance authorized by council and includes the 441,000 bond payments that would begin in 2023, as well as the proposed bond payments of 1.5 million for digester number four beginning in 2025.
Unknown Speaker 1:55:32
Alternative three, therefore includes both the volume and monthly service charge increase for wastewater as well as reflects the decrease in the total amount due to the issuance of that bond for Section 10.2.
Unknown Speaker 1:55:54
Alternative four will also maintain the current rate structure, but rent rate increases are seen both in the monthly service charge as well as in the metered volume charge.
Unknown Speaker 1:56:10
long months utility bills all provide excellent value 2022 rates are low compared to other Front Range communities, and a broad range of reliable services are provided. electric rates in particular are currently among the lowest in the state, which contributes to the overall affordability of utility bills in Longmont.
Unknown Speaker 1:56:33
The next several slides show the total bill impact for the proposed rate increases for all utilities including all previous rate increases as well as the proposed increase for electric presented today.
Unknown Speaker 1:56:46
For wastewater the rate increases occur only in the metered volume charge, the amount increases and the percentage increases for alternatives are shown on the right columns for comparison.
Unknown Speaker 1:57:03
This table represents the proposed rate increases for alternative two for all utilities, but for wastewater the rate increases, the rate increase amounts are shown in the monthly service charge as well as the metered volume charge.
Unknown Speaker 1:57:20
This table represents the proposed rate increases for alternative three with the wastewater rate increase occurring only in the metered volume charge and including section 10.2.
Unknown Speaker 1:57:33
And finally, alternative four represents the amounts for Section 10.2 But the wastewater rate increases occurring only in sorry in the monthly service charge as well as in the metered volume charge.
Unknown Speaker 1:57:50
The all those charts basically
Unknown Speaker 1:57:53
are illustrated here in this one comparison table, which is a side by side table showing the different alternatives and how the average monthly wastewater charge what the average monthly wastewater charge would be for each alternative for each year based on the average monthly wastewater amount of 5000 gallons.
Unknown Speaker 1:58:18
The city of Longmont offers residents opportunities to lower their bills by using energy and water more efficiently. Programs such as efficiency works assist customer assist homeowners and businesses and identifying options for efficiency upgrades, as well as rebates and discounts available for more efficient appliance solutions. LPC is a participant in Colorado’s affordable residential energy program or care, which is available to income qualified residents and provides free home energy audits and energy efficiency upgrades to reduce energy usage and make homes more comfortable. Several partner agencies are able to provide assistance each year for utility payments, including federal assistance through for heating costs through leap or crisis assistance through the our center. Residents may also qualify for the income Qualified Income Based Assistance Program, long month city assistance and rebate system or long my cares.
Unknown Speaker 1:59:20
Through Longmont cares residents receive rebates on the following items, sales tax, property tax or rent parking, Greenway maintenance fee, electricity, storm drainage and water. This program has seen significant increased enrollments since it began in 2019. And the city is continuing to increase the number of participants through outreach efforts. There are an estimated 1800 residents that are eligible to receive these monthly rebates. Currently, the electricity electric rebate refund is $9.20 23 LPC is proposing to increase the monthly rebate amount to $10.50 and increase
Unknown Speaker 2:00:00
Use of $1.50 per month will cover 93% of the average residential customers monthly increase. This chart displays the financial impact of the proposed increases in the rebate amount.
Unknown Speaker 2:00:16
Wastewater rates are not currently a part of the Longmont cares program. Therefore, Staff recommends extending a rebate to qualifying residents for rate alternatives to and for the amount of the rebate is the entire amount of the proposed rate increase in the monthly service charge. This chart shows the financial impact of the proposed increases in the total rebate amount at the target program participation amount of 1800.
Unknown Speaker 2:00:44
There are a number of opportunities available to engage the public around utility bills. The Sustainable Business Program connects businesses to partners and programs for reducing electric and water consumption. Their quarterly newsletter focused on water and offered tips for how to reduce consumption and save money. Messaging for electric is broadcast through a variety of city channels including city line, city talk, LPC next slides more power to you blog,
Unknown Speaker 2:01:13
social media, and the social and the city’s website. outreach activities during community events. And information regarding potential rate changes is also available in both English and Spanish on a city webpage as well as through city wide locations that have high contact with residents.
Unknown Speaker 2:01:34
Council is asked to provide direction to LPC on preparing electric rate ordinances for the proposed electric rate increase, as well as the increase in the amount of electric rebate for the Longmont cares program. Council is also asked to provide direction to pw nr on a wastewater rate option and preparing rate ordinances based on that option. Also, Council is asked to provide direction to pw nr. In preparing an ordinance to amend the Longmont cares rate section to include the wastewater rebate as part of the Longmont cares program.
Unknown Speaker 2:02:13
Please let us know if you have any questions, or if you would like any further information. And thank you for your time this evening. Thank you, Councillor Martin.
Unknown Speaker 2:02:24
Thank you, Mayor Peck. Yeah, I have two questions about the bond issues and the adjuster number four. So I was clear up to the point of we’re in 2025, we’re going to have a ballot measure about question that’s going to ask for a bond issue to pay for LED jester number four.
Unknown Speaker 2:02:49
Where what I don’t completely understand is two things. One, where does the 10.2 bond issue come in? Does that also pay for digester number four? Or is it just to generally lower rates or what because I didn’t hear that part.
Unknown Speaker 2:03:08
Councilmember Martin, that section 10.2 would be for the short term projects for 2023 and 2024, and is not related to digester number four payments. Okay, and what happens if we don’t issue the 10.2 bond issue, then we would have to fund it through other means. And that would mean, we would have to have
Unknown Speaker 2:03:38
sorry, for going back to the slides, you can see it. And it would be included in the rate schedule that we collect the the revenue that we collect through just the right the increase. However,
Unknown Speaker 2:03:52
the prioritization matrix identified the various projects that were the highest priority, and so we would go through that list and ensure that whatever is highest on that list would be taken care of first. Okay, so if we don’t do the 10 point to bond issue, then some of the work that is on the to do list doesn’t get done. That is correct. And we have identified which ones could be delayed if necessary, or which ones are the lower priority. And so then, if the 2025 bond issue does not pass, that means that the adjuster number four is not funded. And do we live without jester number four? And if so, what are the consequences of that? We think we need to back up a little bit. Yeah. So I would say that a little bit differently. I think if we don’t issue the 10.2 You know, bonds that are 10.2 then that just limits your options set here to alternatives one and two. So you know, it’s short term and you know, within that next three years, potentially higher rates, but you know, long term probably lower costs because there’s, there’s no it’s okay faster, so we will raise rates rather than not doing necessary repair.
Unknown Speaker 2:05:00
Sure, right. Okay. Then the gesture number four gesture number four, I may invite Bob to come up and talk about that a little bit. But there are definitely operational and regulatory consequences to not implementing that project over the next five years. And Bob, will he’s Yes, nodding that I said that correctly.
Unknown Speaker 2:05:23
Bob, do you want to add to that?
Unknown Speaker 2:05:29
Mayor and Council, the easy answer to that.
Unknown Speaker 2:05:32
The easy answer to that is that we would haul the biosolids mostly is liquid for probably a couple of million per year. So you’d you’d pay for your digester pretty quickly by building it rather than doing that.
Unknown Speaker 2:05:49
So we just have to explain that to the voters.
Unknown Speaker 2:05:53
Yeah, I think the issue is you don’t have a choice, you have to do it. And if you don’t involve you can step here. If you don’t build the digester, you still have to get rid of it. And getting rid of it operationally is a higher cost.
Unknown Speaker 2:06:07
Okay, thank you. That’s what I needed to know.
Unknown Speaker 2:06:11
Unknown Speaker 2:06:14
Thanks for your back. Let me just follow up on councilmember Martin’s question.
Unknown Speaker 2:06:21
If could you go to slide 12?
Unknown Speaker 2:06:25
Just so I understand the timing.
Unknown Speaker 2:06:31
So this shows the proposed bond payment
Unknown Speaker 2:06:34
in 2025 of a bond question in 2025. How in the heck do you get how do you generate $1.5 million between November whatever the election date is, in the end of in the end of the year to make a $1.5 million bond payment in 2025?
Unknown Speaker 2:06:53
Mayor Pat, Councilmember waters we would recommend going into election in 2024. For that issuance. Well, that’s that’s that’s an important consideration.
Unknown Speaker 2:07:04
Is is so the plan is a 2024 bond question not a 2025. Bond question for 25. issuance. Yes.
Unknown Speaker 2:07:14
Say that again for issuance of the bonds in 2025. Correct for this is specifically then fight for digester number four. Correct. All right.
Unknown Speaker 2:07:28
You’ve partially answered the only other question, I guess I would have Harold. And that is the cost of maybe two questions. The cost of not doing this is is not just
Unknown Speaker 2:07:40
the however many millions of dollars a year we would spend to haul the liquid waste away, right that we would be able to process through digester number four. That’s, that’s an that’s an obvious calculable cost on an annual basis. But there’s a bigger cost here across the board, not just wastewater of all the infrastructure related projects here. The implications or the cost of not doing this to Longmont residents. And I just think, every time when this conversation I think we need to reinforce for us and for the community and maybe for us so that we can in conversations with the community, remind people of what the implications are, if we don’t do this, I will read about myself in the TEC line and other parts of the, you know, on social media about the Be reminded the idiot I am. Because I’ve been told you know, I’ve read it how many times I’m one of the idiots up here. With all due respect. I don’t think anybody up here is an idiot. I just read it from the public about raising rates again, don’t we get it? Don’t we understand how the cost of living in this town and we’ve done it again, and we do it over and over again. I was I left a social activity
Unknown Speaker 2:09:00
this afternoon that was organized by my church. And as I’m walking out the door, saying goodbye. Somebody says Oh, remember, don’t raise rates. That was the last comment. I didn’t have time to say let me tell you what it’s going to cost if we don’t. But But remind us what’s it going to cost if we don’t? Here’s the bigger related question.
Unknown Speaker 2:09:22
We’ll probably can’t do it tonight. But it would be helpful to get an estimated cost of up upgrading or updating our infrastructure across the board. Right. Harold in an earlier conversation even this evening, you you you pointed out
Unknown Speaker 2:09:40
that much of the infrastructure that exists in Longmont was paid for by developers. The comment the development pays its own way, right. Initially, the rest of us pay for that cost over the next 50 years. So I’ve asked the question when we’ve seen annex
Unknown Speaker 2:10:00
ation applications and we get a 30 year analysis, I’d say, Can we see the 50 year analysis? Because that’s the lifespan of the infrastructure. And if we go back to this to the systems we’re talking about now we’re talking about the bill is coming due now. It’s just starting, and it’s gonna run for a while to cover the cost of, of infrastructure upgrades. That’s why we got to the federal legislation. But long monitors need to understand if we don’t want to become Flint, Michigan, in Jackson, Mississippi and fill in the blank.
Unknown Speaker 2:10:31
What’s it going to cost us in the short term, so we’d well and on an ongoing basis, so we don’t ever become Flint, Jackson, or, you know, the rest of the parts of the country that we read about in are aghast at how the hell their municipalities could let that happen. So big questions, I’ll be quiet. So what I would say is, I would point everyone to a great article in the Wall Street Journal, I called it up just now. And for everyone’s a reference, it’s called Jackson water crisis forces cities to confront their own aging infrastructure issue. utilities say the situation in Mississippi’s Capitol is a wake up call to problems with a nice nation’s aging pipes and pumps. So you got to start there.
Unknown Speaker 2:11:16
And I think when you look at Flint, Michigan, Newark, New Jersey, Jackson,
Unknown Speaker 2:11:21
they profile areas in Southern California. This is not new.
Unknown Speaker 2:11:27
There’s an interesting paragraph in here that says, unlike bridges and roads and subway lines, clean drinking waters isn’t primarily funded by taxes, more than 90% of the average utilities revenues come directly from constituents water bills, those bills are soaring along with the cost to fix problems. Homeowners water and wastewater maintenance bills across the country are up an average of 46.6%. Over the past 10 years.
Unknown Speaker 2:11:54
What’s happening is the it’s time to pay the piper based on if you’ve had a location in an area where you haven’t made incremental improvements to the infrastructure, and it has now aged out, you’re buying a lot of problems. I think the number that they’re releasing now with Jackson is $2 billion to replace the system.
Unknown Speaker 2:12:20
And what you look at, in in Bob knows this about me, I’m kind of hypersensitive to water leaks. And when I start seeing my call, I mean, go what’s going on? Why am I hypersensitive when you start seeing multiple boil water notices, you start seeing multiple water leaks, what you read, it’s too late at that point.
Unknown Speaker 2:12:40
The problems are there, and you have to fix it. And it’s much more costly to do it at that point than if you take a a really focused incremental process steps into rebuilding the infrastructure and it costs money, it is incredibly hard to look the community in the face and say we need to raise your water bill 5% or 10%.
Unknown Speaker 2:13:02
Think about those communities that have to look at their residents and say, We have to raise it 20% or 25%. Even with the federal dollars coming down, when you read the articles, there is not enough money to deal with these issues. And they’re going to have to deal with the most severe issues throughout the country.
Unknown Speaker 2:13:23
And so I think what I would say is, this is not a cost we can avoid. This is a cost that will hit us at one point in time. And if you deal with it on the front end, while it may be a little bit painful, it’s going to be much more affordable than waiting until it blows up on you because it will and we’re seeing that across the nation in cities, cities that are having one major water line run from their water supply source to their treatment plan. Think about that for just a second. And now they’re having to figure out how do we build this. And if you say if you would have built it 1520 years ago, what would the cost difference be in the price of adding additional waterline? Hundreds of millions of dollars in this. And so what I would say is we are in a good position in terms of Walmart today.
Unknown Speaker 2:14:12
I talk about it in terms of where our infrastructure is based on where we’ve seen the bulk of our development in our community. We’re at that point where we’re entering the replacement cycle, look to the other cities, and don’t miss that opportunity to start proactively replacing, because it may not cost me more. But it’s certainly going to cost someone who comes out 30 years after me more and give them a really big problem to deal with. And I don’t know how else to say this other than you can read multiple articles. I can talk about my personal experience. That’s the world. And I don’t know if that answered your question, but you know, that’s what I’m seeing.
Unknown Speaker 2:15:01
Unknown Speaker 2:15:03
Thanks, it answers. First of all, I get the rationale, I think we ought to amplify what you just said, We got to take advantage of every opportunity to amplify what you just said.
Unknown Speaker 2:15:16
Because people are going to it’s just going to be a glancing, you know, message and, and people are gonna look at their bill, and then we’re going to read about it, I think we just need to continue to remind people of what the implications are, if we don’t do this, the costs are much greater. I’d still like to go back at some point, not tonight. But I think at some point, we ought to have we ought to have this, the Gestalt, what’s the big picture over the next decade or two, whoever sits up here, right to be reminded as candidates to be reminded in forums, in their willingness to make the hard decisions, unpopular decisions to keep Longmont from ever having to ask the federal government to socialize our
Unknown Speaker 2:16:00
unwillingness to make the investments that we have to make and with that,
Unknown Speaker 2:16:05
so what that estimated cost would be and I it’s going to be a certain a gross ballpark, but I think it would be really helpful. And there’s probably no way to do what I’m going to ask about now. But But I wish there would be that
Unknown Speaker 2:16:20
the Cares Act
Unknown Speaker 2:16:22
Unknown Speaker 2:16:24
not Cares Act, the cares program,
Unknown Speaker 2:16:28
allows those who are really pressed financially to get some relief from these rate increases, but that we’re going to socialize that I mean, others or others are going to pick people that cost because of what we’re doing with with rate increases, right.
Unknown Speaker 2:16:44
It’d be nice if we could some way scale, that socializing that cost. So those who are on the upper level of the income spectrum in Longmont to absorb more of this, because those who are just on the edge who don’t qualify for cares, but are going to pay the same rate increase as somebody making multiples of what they make annually, right in terms of their rate increase. And through our billing system there. I don’t know if there’s a way to do it. But it just it’s hard. It’s harder to sell to somebody who’s on the edge than somebody who for this is this, this doesn’t matter, they’ll won’t even recognize it. Right from month to month, in terms of the impact on their ability to buy food or gas or pay for rent or whatever, if there was a way to somehow scale that and no, that’s all it means testing for a few dollars a month probably doesn’t make a lot of sense. But if there was a way to do it, we ought to do it. My opinion.
Unknown Speaker 2:17:43
Counts. Councillor Martin.
Unknown Speaker 2:17:45
Thank you, Mayor Peck. I just wanted to say, you know, even though it may not be perfect in terms of being perfectly progressive, but I wanted to commend the array calculation process for automatically putting the increase in the Karis at I’m sorry, there we go. Again, the cares rebate. When we originally had a good sized electric rate increase, the council had to remind the staff of, of the necessity to do that. So I really appreciate that being rolled in.
Unknown Speaker 2:18:29
In terms of communication,
Unknown Speaker 2:18:32
it was really nice to see that stacked bar chart of the other Front Range communities. And
Unknown Speaker 2:18:41
overall, how big they’re built that well, that one, go back, go back that one. Yeah. And it’s nice that we are so close to the low end, but it would be even better. What I’m thinking is, especially in terms of the you know, the skinniness of some of those bars, it would be really good to know, in the about the cases where Longmont is actually providing services at a higher level or providing services that are not provided at all by some of those other municipalities. Because I think you will find that we stack up even better than what it looks like
Unknown Speaker 2:19:24
when when you look at it that way. So I don’t know how you’d represent it, whether you’d break unstack them and have a different graph for each one so that you could see that, you know, our Vatta isn’t giving you as much for your dollar in terms of waste diversion, for example. Not that I know I’m just making that example up.
Unknown Speaker 2:19:46
But it’d be great for people to understand that not only are we paying at the low end of rates or near the low end of rates, but we’re getting more value for those rates than other municipalities give
Unknown Speaker 2:20:00
If that’s possible, just a suggestion.
Unknown Speaker 2:20:09
I just have one comment. Can you tell him
Unknown Speaker 2:20:12
on film here? What a digester is, as people are watching this, what does this mean to them?
Unknown Speaker 2:20:22
will solve your time as Bob comes down? Okay, an anaerobic digester is yes.
Unknown Speaker 2:20:31
It does the same thing your stomach does.
Unknown Speaker 2:20:35
That’s, that’s the quick answer.
Unknown Speaker 2:20:38
Solids are generated in the wastewater process. And they can be reduced in in mass overall by digestion, and then hauled away at a much lower cost or land applied, because it’s much more stable than if you don’t do the digestion process. So it is one of the processes where we have other options, like hauling the liquid, which is much more expensive, some of the process improvements we need, we don’t have other options, and we have to do them because of the regulations. So that’s a garbage disposal. It’s so to speak. It takes it down to something that my last year till the director I worked with, he called it pancake. It’s it’s a really dense material. It does just what your stomach does, and you can use all your imagination. Thank you very much. So one of the
Unknown Speaker 2:21:36
Yeah, so I think
Unknown Speaker 2:21:38
we need direction on whether to move forward with the increase in electric in terms of the wastewater, you can see the four options here.
Unknown Speaker 2:21:50
The to address the question in terms of how do you
Unknown Speaker 2:21:56
if you look at those that are able to afford it more for those are more able to afford it. Unless you’ve seen something different, typically, what people do is really hit the volume on that side, because that the volume gives people the ability to
Unknown Speaker 2:22:13
deal with that issue.
Unknown Speaker 2:22:16
And so that would be option one,
Unknown Speaker 2:22:19
in this case, and so you wouldn’t almost need to pick a volume increase or a monthly volume increase. That’s your first decision point. And then your second decision point is, do you just do the increase? Or do you utilize section two point 10.2 of the charter?
Unknown Speaker 2:22:42
So I this is open to discussion. Do we have any comments from counselors on which one you would prefer?
Unknown Speaker 2:22:52
This is a lot of information thrown at us.
Unknown Speaker 2:22:56
Unknown Speaker 2:22:59
I’ll start it off. I think that
Unknown Speaker 2:23:03
Unknown Speaker 2:23:10
I’m having a hard time digesting this all as well, to be quite honest.
Unknown Speaker 2:23:20
Unknown Speaker 2:23:24
Okay, Mayor Pro Tim.
Unknown Speaker 2:23:30
Thank you, Mayor Peck. Could you explain why alternative three appears to be the cheaper option?
Unknown Speaker 2:23:38
Sure, Mayor Peck, Mayor Pro Tem Rodriguez. So in alternative three, we’re making use of Council’s ability to authorize the issuance of debt without a vote of the public to pay for capital improvements in that three year period using debt. So you know, kind of reducing the overall
Unknown Speaker 2:24:02
revenue requirement within that three year period by $6 million. So that’s, that’s what’s going on there as we’re decreasing the amount that we’re taking in over that period. So it ends up kind of lower
Unknown Speaker 2:24:15
at the end of the three years. Sure. But alternative four also utilizes the same tool, but it’s slightly more, right. So similar to how so alternative one is parallel to alternative three in terms of like, what the so you can see how alternative one is slightly lower than alternative two.
Unknown Speaker 2:24:34
And then alternative, two and four are similarly
Unknown Speaker 2:24:39
parallel. And so what what we’re seeing here is where all of the increase is happening in the volume increase in, in one in three. It’s keeping the overall increase lower for people who are on the lower end of use, so people who are higher users will absorb more of the increase
Unknown Speaker 2:25:00
So, okay. Yeah, that’s Claire’s that clears it up for me. I believe in the council comments said staffs recommendation was alternative one.
Unknown Speaker 2:25:08
Was that not accurate? I do not recall whether we
Unknown Speaker 2:25:13
whether we made a recommendation. Okay. For some reason I thought it said in the council comment, they recommended options, one for both items. Oh, I think I think we were differentiating between option one, which is, you know, to provide direction to, you know, bring forward changes, and, you know,
Unknown Speaker 2:25:36
having that different from the alternatives, which are the rate alternatives? So, yes, we think, you know, and option and option one, for, you know, the cares thing is that we should bring forward changes to the cares program to include wastewater and to increase the electric rebate. Okay, so then Just a quick follow up on 10.2, in the sense that that is a debt mechanism.
Unknown Speaker 2:26:02
What is the repayment term? Is it similar to our normal bond? Yes. So we’re talking about 20 plus 20 years?
Unknown Speaker 2:26:14
Yeah, I mean, it cost you more over time. Yeah. It’s just doesn’t have the same rate impact?
Unknown Speaker 2:26:24
Unknown Speaker 2:26:27
It’s a tool in the toolbox. It’s a tool toolbox.
Unknown Speaker 2:26:32
I probably tend towards alternative one personally.
Unknown Speaker 2:26:44
Unknown Speaker 2:26:49
You did? I’m back on now. Thank you. Thank you.
Unknown Speaker 2:26:54
So what I heard you say Harold must respond to my question about some kind of means testing, is that the volume is the way you get at that, that
Unknown Speaker 2:27:07
or the approximation of it. So, so opt alternative number two, or anything with volume in it? The assumption is, or presumption is that those who are not stressed by the cost here, likely are going to pay more for the cost of this because they’re because they’re going to be volume users, right?
Unknown Speaker 2:27:31
So the related question for me is on 10.2.
Unknown Speaker 2:27:36
How many times do we get to go to the well, or go to the bank? One time until that debt service one time, if you get one shot, if you got any debt created, that way, your hands are tied until you’ve got that debt service. So no council would be able to use 10.2 in the charter for 20 years, or until the debt service.
Unknown Speaker 2:28:00
Is that correct? I’m looking for Mayor Pac Man, and I’m looking for councilmember waters. My understanding is that we could we could issue additional additional debt up to that one half of 1%. And that that would change as the assessed valuation. So you know, you have relatively small increments.
Unknown Speaker 2:28:17
Yeah, but it wouldn’t be much. So
Unknown Speaker 2:28:20
what is what’s our timeline on this? We need to you need a decision by when?
Unknown Speaker 2:28:25
Tonight? Soon. So if you Yeah, if you need additional information, you know, we can come back probably to the next meeting with it. I’m just thinking about, there’s this there’s this other conversation on quality of life, and and how that may be a factor in that one as well. But we should not think of this in relationship to other kinds of decisions. No, I think when we talked about this, you know, we I guess the question is, you know, I said, Well, why didn’t we? So we’re looking at issuing $90 million of debt and 25. And, and I said, Well, what happened here?
Unknown Speaker 2:29:04
Well, what happened was, is we had a plan to cashflow,
Unknown Speaker 2:29:08
inflation and everything else that we’ve been talking about, just hit those projects. So we had a gap in funding based on the world that we’re in. And because, you know, we have to have the vote, we can’t go to a vote to issue the debt and time for us to get the projects done that we need to and we put this in to give you all your options. So, so alternative three has the smallest impact on ratepayers over the long term. Assuming that we it’s not a lot but it’s appears to be in these numbers over the small over the but over our 20 year period of time.
Unknown Speaker 2:29:56
Because that’s the length of time we would be issuing or servicing that there.
Unknown Speaker 2:30:00
Unknown Speaker 2:30:02
using the charter option. So, mayor, Mayor Peck councilmember waters, I’d actually say that there’s probably a larger impact over the 20 year time period, because you’re also paying the interest on whatever bonds you’ve issued with there is a smaller impact to rates in the three year period. Because just in terms of what we’re seeing here, right, so what does that look like? Can you run that out? So that was that. So that’s a bet that based on interest rates, and whether it’s based on interest rates, you know, it’s going to be roughly double. So if we’re looking at 6 million, you know, we’re paying 12 million over 20 years,
Unknown Speaker 2:30:37
you know, but we’re paying one and a half million in this three year period instead of 6 million. So what are the out years look like? For alternative two?
Unknown Speaker 2:30:46
There is no additional rate pressure based on what’s included here, there’s the you know, we’re covering the debt service requirements for digestor. Number four, with this, so would it be nice to look at what the 2000 if when 2025 to 30, or, you know, with, with whatever current district interest rates are, in order to get an idea of what those costs are ratepayers would be in the years beyond 2025? I was ready to settle on one of these, but no, I’m not sure. Okay, we can bring that, we can bring that back to you where you can see it.
Unknown Speaker 2:31:26
You know, rule of thumb is when you cash flow, when you cash when you cash fund it, it is cheaper over time, but you have to hit it really hard in order to generate the cash. And then when you pay it off, that then helps create capacity for other capital projects that you can flow into it. And so it really is, it’s more of that immediate issue
Unknown Speaker 2:31:48
that hits but over time, I will say it’s a little bit more level versus when you issue the debt. It’s moves you into it, but you’re paying it out over a longer term.
Unknown Speaker 2:32:03
Counselor water, I mean, I’m sorry, mine.
Unknown Speaker 2:32:07
Thank you, Mayor pick up. So on the 10.2 issue. I if if the assessed value occurs us valuation of the city is in there. I missed it. So
Unknown Speaker 2:32:23
how, how many wishes would we have left? If we issued the 10.2?
Unknown Speaker 2:32:34
Unknown Speaker 2:32:37
Yeah, we modelled using $6 million worth of that capacity, and the actual capacity is somewhere in the neighborhood of eight. Okay, so if we don’t have much of a wish, left, okay, so that that makes me against doing it, because we could have a bigger emergency in the future. Good. Okay. Thank you.
Unknown Speaker 2:32:57
So my question is, we are going after any grants, federal funds, etc. If we raise these rates rates now and we get federal funding, perhaps for the digester, or enough to eliminate the total cost of that? How does that affect our rates? Do they stay where they are? Or do we say we got money to pay for this there for because I know rates never come down? electric rates, water rates or whatever. And in 2026, we’re going to come back for another rate increase, you can bet on it.
Unknown Speaker 2:33:37
So that’s what’s really difficult for me to get my head around sometimes is that we do go out for these funds, but it doesn’t affect us, if we get them. I mean, I’m sorry, it doesn’t affect the residents in their monthly pay. I think it would affect the long term because you would treat it as a stabilization for you would treat it as stabilization. So as you’re moving in with your normal inflationary pressures in the future, or other capital projects, so let’s say you’ve got $5 million to offset a digester. Well, that $5 million dollars carries forward and you can use it on other projects down the road or to absorb some of those inflationary pressures. So it probably lowers future rate increases, based on how you’re able to do it. I’ve seen some people reduce them, but then you just end up increasing it over time. And so I would look at it as anything you’re able to bring in from a grant fund perspective as you almost treat it as a stabilization into the future. So you can minimize future increases that are the result of inflation or other things. The wastewater utility has benefited from the FEMA funding for flood recovery, I want to say probably about between five and 10 million, probably in the five range of that, you know, overall $55 billion allocation for the for
Unknown Speaker 2:35:00
Recovery went to the wastewater fund to replace pipes that were damaged and things like that. So, so we have seen a benefit.
Unknown Speaker 2:35:08
You know, that’s kept our rates from having to go up much over the the, you know, in the recent past, we’ve had we have very small increases in 2018 19, and 20, no increases in 21 or 22. And now, because you know, inflation and these other factors have come in, we are needing to seek these increases. But we may look forward to something like that, where we have sub inflation rate increases for a period of time if we are successful in that grant funding. Search.
Unknown Speaker 2:35:47
Unknown Speaker 2:35:50
Thank you, Mayor Peck.
Unknown Speaker 2:35:52
I’m not entirely sure what forms stabilization can take. So I was thinking, would an example of
Unknown Speaker 2:36:02
minimizing the city’s overall indebtedness is an important thing. So if we got that $5 million for the digester in time, we could then lower the amount of the bond issue, that would be an example that everybody would understand. Yeah, so if it was 20 million, and you got a 5 million grant, it could be 15 million, or 15 million in debt. Yeah. Okay. Thanks. That helps. And just to say it out loud, that is our plan related to the storm drainage bonds that we’re currently seeking, is, uh, you know, if we are successful in receiving FEMA funding for that project, we would reduce the bond issuance? We would not, you know, continue with the bond issuance and,
Unknown Speaker 2:36:46
you know, do something different. Yeah. Perfect. Thank you. So you do want direction on this tonight? So let’s go with each counselor and tell what it is you’re thinking, I can see that there’s with the questions, that there’s a lot of
Unknown Speaker 2:37:04
there’s just a lot of questions about how we should do this.
Unknown Speaker 2:37:09
And how we educate the public on doing it.
Unknown Speaker 2:37:13
Unknown Speaker 2:37:15
So, Councillor Yarbro, we haven’t heard from you.
Unknown Speaker 2:37:23
Thank you, Mayor Peck. Well, I had to
Unknown Speaker 2:37:27
get confused and get on fews. Net and get confused again. So what I see what I think, personally, from listening to all the conversation, the alternative number one, will be the most equitable decision. The volume increase will be where, you know, our residents will use whatever they use, that’s what they pay, and hopefully they make good decisions. And, you know, look at their bills and say, Oh, I could turn you know, water off, instead of just letting them run or whatever.
Unknown Speaker 2:38:06
For me, it will be alternative one. That’s my perspective, because alternative two is also increasing. Not just volume, but extra muffling increase, right. Is that correct?
Unknown Speaker 2:38:21
They are pet councilmember Yarborough, that is correct. But we are proposing to offset the increase in that monthly service charge by including that in the carrier’s rebate.
Unknown Speaker 2:38:31
So little from Column ala from column B.
Unknown Speaker 2:38:36
It goes to the point earlier, it’s more of those on the margins.
Unknown Speaker 2:38:42
Your point applies on so if you’re just above the threshold, the gatekeeper to your to receive cares funds.
Unknown Speaker 2:38:50
Your point applies on on alternative one
Unknown Speaker 2:38:54
Unknown Speaker 2:38:56
That is correct. And we do still have the option to implement the cares rebates at the amounts that we’ve proposed regardless of the option selected.
Unknown Speaker 2:39:09
Mayor Pro Tim
Unknown Speaker 2:39:13
I think I did state earlier that my preference was alternative one for basically what was just stated about the folks on the margins and the monthly service charge. The folks that do not qualify for the cares rebate. So still is alternative one.
Unknown Speaker 2:39:27
Unknown Speaker 2:39:30
I agree. I think can’t option one is the most equitable and thriftiest in the long term.
Unknown Speaker 2:39:39
Counselor waters. Just let me just clarify.
Unknown Speaker 2:39:44
All these are predicated on the all these rates or the costs are predicated on a successful bond question in 2024.
Unknown Speaker 2:39:55
What are the where do we stand in at this time in 2000
Unknown Speaker 2:40:00
25, if that are in 2024, in December 2024, if it fails
Unknown Speaker 2:40:09
your pet councilmember waters as as with any financial plan, you don’t get yes moving forward. Without that that bond in place would require recalculation or changing the the project plan, you know, the capital plan that was funded. So the council, these council members in 2020 20, the fall of 2024, will be looking at a different set of rate recommendations. If a bond election fails, most likely, yesterday. Number four, Bob is just coming in to say, you know, the cost would shift into your operating budget, which would require a lower but still an additional probably rate increase, or we would look at running it again and 25 and fill in the gaps, understanding what people’s issues were, it would either have to run again in 25, or we’d have to dump it in operation. Yeah. Yeah, I’m, I agree with alternative one, given everything we’ve learned and not tying the city’s hands and Future Councils hands on, do whatever they might want to do with 10.2 in the charter. So
Unknown Speaker 2:41:17
thank you, everybody. So your direction is alternative one.
Unknown Speaker 2:41:21
And we have direction on the electric utility to bring that back with the increases that Brian talked about.
Unknown Speaker 2:41:31
Thumbs up or down and direction on the cares program? Both great, we’ll bring you ordinances Thank you very much.
Unknown Speaker 2:42:01
Unknown Speaker 2:42:07
it in what is it December, January and February? i When my kids were at home, I would yell at them about their link to their showers.
Unknown Speaker 2:42:22
Thank you, Mayor Peck I think I’ve we already let all the people go. But these are actually the even though this is wastewater, it’s based on people’s water meter consumption flow, right. The winter monthly averaging. Yeah. And so
Unknown Speaker 2:42:41
you know, the city is simultaneously doing things to encourage people to reduce their water consumption, like there’s a Zero Escape incentive program going on? Are we going to cut off our noses to spite our face by what happens if the city really gets into water use reduction? So it’s December, January, February, right?
Unknown Speaker 2:43:08
Or mixing a different place? November, June? November, December, January usage as build up December, February. Okay, so probably won’t make much difference. Because most outdoor irrigation, you’re you’ve already blown your sprinklers and you’re not able to do it. So I will say,
Unknown Speaker 2:43:27
due to changing temperatures, we are seeing more irrigation in those months than we have expected in the past.
Unknown Speaker 2:43:35
But that works in the favor of funding these issues. Yes, yes. But you’re right, overall declining usage and you know,
Unknown Speaker 2:43:47
you know, lower use fixtures and things like that do do affect the billable volume here. So you know, that’s also a little bit of a part of the increase in the volumetric charges. Okay, thank you.
Unknown Speaker 2:44:09
So we’re back to the agenda, and it’s the mayor and council comments. Do we have any comments from anyone? I think we made a lot of comments tonight. Actually, I do have a comment in that we are having the we all got the email about the Northern Arapaho anniversary. So anybody who wants to go up to Wyoming in October, I’ll have to pull up that date, but we do have it on our emails.
Unknown Speaker 2:44:35
Unknown Speaker 2:44:37
So it’s over the weekend. It’s only going to be two days actually I think. So you can email
Unknown Speaker 2:44:46
that lady who’s raising her hand back there? Sandy cedar, if you would like to go?
Unknown Speaker 2:44:53
City Manager hell do you have any comments? Now that’s Mayor council, city attorney Eugene
Unknown Speaker 2:45:00
Mayor and Council, the fun is just beginning. Just want to remind you we are going to continue the public meeting to go into executive session to talk about gun safety ordinances. So I’ll see you over in the study session room. Okay. So can I have a motion to adjourn this meeting?
Unknown Speaker 2:45:18
And a motion to continue and executive reconvene in Executive Session.
Unknown Speaker 2:45:24
Second, okay. So we have a motion from a counselor Martin, a second vice mayor pro Pro Tem Rodriguez to adjourn the city council meeting and reconvene in an executive session about gun safety.
Unknown Speaker 2:45:43
Yes, all those in favor raise Your Hand
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