* This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting. [00:00:03] ALL RIGHT. GOOD [BCRUA Board of Directors Meeting] EVENING. I WILL, UH, CALL THE 6:00 PM BCUA MEETING, UH, TO ORDER, UH, DAVIDA, IF YOU WOULD DO ROLL CALL. PRESIDENT BAKER HERE, VICE PRESIDENT THOMPSON. PRESENT. SECRETARY DUFFY? HERE. DIRECTOR ANDERSON. DIRECTOR FLORES. HERE. DIRECTOR. UH, KIRK KIRKLAND HERE. ALRIGHT. THANK YOU. UH, CITIZENS COMMUNICATION. ANY CITIZEN WISHING TO SPEAK DURING CITIZEN COMMUNICATION REGARDING AN ITEM ON OR OFF THE AGENDA MAY DO SO AFTER COMPLETING THE REQUIRED REGISTRATION CARD. ALL COMMENTS MUST BE NO MORE THAN THREE MINUTES IN ACCORDANCE BEFORE POLICY. DO YOU HAVE ANYBODY SIGN UP TO SPEAK SAYING NONE? NUMBER FOUR, APPROVAL OF THE MINUTES. CONSIDER APPROVAL OF BCRA MINUTES FOR NOVEMBER 15TH. MOTION TO APPROVE. SECOND. HAVE A MOTION TO APPROVE BY VICE PRESIDENT THOMPSON. A SECOND BY SECRETARY DUFFY. ALL IN FAVOR SAY AYE. AYE. AYE. MOTION PASSES. NUMBER FIVE, STAFF REPORTS. CONSIDER A STAFF REPORT FROM THE GENERAL MANAGER REGARDING B-C-R-U-A CAPITAL PROJECTS AND OPERATIONS. GOOD EVENING. UH, GOOD EVENING, MR. PRESIDENT. IT THIS ON? UH, GOOD EVENING. THIS IS MY FIRST NIGHT. I'M PROBABLY GONNA BE A LITTLE SHAKY. I APOLOGIZE FOR THAT. . UM, THIS, THIS ITEM IS FOR STAFF REPORTS ON THE CAPITAL PROJECTS AND OPERATIONS, AND WE'RE GONNA BREAK THAT UP INTO TWO, TWO CATEGORIES. AND AARON ARCHER WITH WALKER PARTNERS IS GONNA DO A REPORT, UH, ON ALL THE CAPITAL PROJECTS WE HAVE GOING ON. AND THEN I'M GONNA DO A VERY BRIEF REPORT ON SOME OPERATIONS, UH, MATTERS. GOOD EVENING, SIR. GOOD EVENING. DO WE HAVE THE POWERPOINT? EXCELLENT. UH, GOOD EVENING. PRESIDENT AND BOARD OF DIRECTORS, B-C-R-U-A RIGHT NOW HAS A LARGE NUMBER AND A WIDE VARIETY OF CAPITAL PROJECTS IN DEVELOPMENT. AND SOME OF THOSE PROJECTS HAVE BEEN UNDER CONSTRUCTION FOR MULTIPLE YEARS. SOME OF THOSE RIGHT NOW ARE AT THE EARLY STAGES OF DESIGN. UH, THE PURPOSE OF MY PRESENTATION TONIGHT IS TO GIVE YOU A STATUS UPDATE ON B UAS CAPITAL PROJECTS AND ALSO TO GIVE YOU A GLIMPSE INTO SOME UPCOMING ACTIVITIES. UH, HERE YOU CAN SEE LISTED THE PROJECTS I'LL BE TALKING ABOUT TONIGHT. I'LL START WITH THE PHASE TWO RAW WATER DELIVERY SYSTEM, SINCE IT'S BY FAR THE LARGEST THAT WE'RE WORKING ON, AND IT'S BEEN SINCE ABOUT, I BELIEVE, OCTOBER OF LAST YEAR SINCE WE HAD A CHANCE TO TALK ABOUT IT. THEN I'LL GIVE YOU AN UPDATE ON THE PHASE 1D WATER TREATMENT PLANT EXPANSION, UH, FOLLOWED BY THE UNDERWATER PIPELINE REPLACEMENT, THE DELIVERY POINTS PROJECT, WHICH WE'VE BROKEN INTO TWO SEPARATE PHASES. AND THEN LASTLY, I'LL GIVE YOU AN UPDATE ON PHASE TWO A, WHICH WE TALKED ABOUT AT SOME BOARD MEETINGS AT THE END OF LAST YEAR BECAUSE OF THE NUMBER OF THESE PROJECTS. WHAT I'D LIKE TO ENCOURAGE YOU TO DO IS AT THE END OF EACH PROJECT UPDATE, I'LL PAUSE FOR A MOMENT. IF WE HAVE ANY QUESTIONS OR DISCUSSION, WE COULD TACKLE IT THEN RATHER THAN TRYING TO SAVE IT TO THE VERY END. SO STARTING WITH PHASE TWO, UH, THE RAW WATER DELIVERY SYSTEM, I LIKE TO START WITH JUST A REVIEW OF HOW WE'RE LOOKING ON THE PROJECT IN TERMS OF COST AND SCHEDULE FROM A SCHEDULE PERSPECTIVE. WE STARTED THIS PROJECT IN THE SUMMER OF 2022, AND RIGHT NOW WE'RE AT ABOUT 35% OF THE WAY THROUGH OUR SCHEDULE WITH FINAL COMPLETION SCHEDULED FOR APRIL OF 2027. I'M HAPPY TO REPORT RIGHT NOW THAT THE PROJECT IS ON TIME, IF NOT MOVING JUST A LITTLE BIT AHEAD OF SCHEDULE ON A COST BASIS. THE ORIGINAL CONSTRUCTION CONTRACT WAS JUST SHY OF $225 MILLION. WE HAVE NO CHANGE ORDERS TO REPORT TO DATE, AND, UH, THE, THE CONTRACTOR HAS INVOICED AT THIS POINT JUST UNDER A HUNDRED MILLION DOLLARS ON THAT PROJECT OR ABOUT 43%. I WANT TO TALK FOR A MINUTE ABOUT THE WORK COMPLETED ON THIS PROJECT SINCE THE LAST TIME I GAVE YOU AN UPDATE. THE CONTRACTOR HAS REACHED SOME MAJOR MILESTONES THAT ARE VERY SIGNIFICANT FOR THE TEAM. UH, ONE OF THE FIRST IS THAT THE CONTRACTOR HAS COMPLETED THE MARINE INTAKE IN LAKE TRAVIS. UH, THEY HAVE DRILLED THE TWO SHAFTS FOR THE TWO INTAKES IN THE LAKE, ASSEMBLED THE 96 INCH DIAMETER STAINLESS STEEL RISER PIPES PLACING DOWN IN THE LAKE BED AND THEN GROUTED THEM IN PLACE WHERE THEY WERE READY FOR THE INTAKE TUNNEL TO BE MINED BENEATH THEM. UH, THAT WORK REPRESENTS THE MAJORITY OF THE VERY COMPLEX [00:05:01] MARINE WORK ON THE PROJECT. THE CONTRACTOR WILL COME BACK A COUPLE YEARS DOWN THE ROAD AND INSTALL SCREENS AND GATES ON THOSE INTAKE STRUCTURES. BUT GETTING THIS MARINE WORK COMPLETED WAS A MAJOR MILESTONE FOR OUR PROJECT. AND YOU CAN SEE A PHOTOGRAPH TO THE RIGHT THERE OF THEM TAKING ONE OF THESE SECTIONS OF RISER PIPE AND TIPPING IT VERTICALLY WITH THE CRANE TO LOWER IT DOWN INTO THE LAKE BED. THE CONTRACTOR HAS ALSO COMPLETED, UH, THE MINING OPERATIONS FOR THE PROJECT, MEANING THAT THEY'VE DONE THE 12,000 LINEAR FEET OR JUST OVER ABOUT TWO MILES OF 11 FOOT DIAMETER TUNNELS THAT WERE ASSOCIATED WITH THE PROJECT. AND SO MAJOR TUNNELING AND UNDERGROUND OPERATIONS AT THIS POINT ARE COMPLETE SINCE THE TUNNELING OPERATION HAS CONCLUDED. THE CONTRACTOR THEN SPENT THREE VERY DIFFICULT WEEKS BACKING UP THE TUNNEL BORING MACHINE, ABOUT 9,000 FEET FROM THE END OF THE INTAKE TUNNEL BACK TO THE MAIN WORK SHAFT WHERE THEY WERE ABLE TO REMOVE IT SECTION BY SECTION. I'VE GOT A PHOTOGRAPH ON THE LEFT THERE OF THEM REMOVING THE ROTATING CUTTER CUTTERHEAD FROM THE MAIN SHAFT BY CRANE AT THE SAME TIME THAT THEY WERE DOING THE FINAL MINING AND THEN TAKING APART THAT TUNNEL BORING MACHINE. THE CONTRACTOR WAS ALSO WORKING ON INSTALLING THE 78 INCH DIAMETER STEEL PIPELINE FOR THE TRANSMISSION TUNNEL, WHICH INCLUDED LOWERING IT DOWN INTO THE TUNNEL, PUTTING IT ON THE RAIL SYSTEM, RUNNING IT UP THE TRANSMISSION TUNNEL, WELDING IT IN PLACE. AND THEN AFTER IT WAS WELDED IN PLACE, THEY COVERED THE EXTERIOR OR THE ANNULUS WITH CELLULAR GROUT. AND SO THAT WORK HAS ALSO BEEN COMPLETED AND YOU CAN SEE A COUPLE PHOTOGRAPHS OF THEM CONVEYING THAT PIPE AND WELDING IT UP IN THE TUNNEL. UH, IN ADDITION TO COMPLETING THE TRANSMISSION PIPELINE IN THE TUNNEL, THE CONTRACTOR COMPLETED THE SMALL SECTION OF SEVERAL HUNDRED FEET OF OPEN CUP PIPELINE AND TRAILS AND ROAD. UH, THERE'S STILL A CLOSURE PIECE THAT WILL NEED TO BE INSTALLED, BUT THE MAJORITY OF THE LARGE DIAMETER STEEL PIPE WORK FOR THE TRANSMISSION SYSTEM HAS BEEN COMPLETED. AND NOW THE CONTRACTOR HAS BEEN WORKING ON INSTALLING, UH, CONCRETE DROP SHAFTS OR A COUPLE OF DRILLED SHAFTS IN THE VILLAGE OF ANTE THAT WILL BE USED TO LOWER CONCRETE DOWN INTO THE TUNNEL WHEN THEY PLACE THE LINER FOR THE INTAKE TUNNEL SYSTEM FROM THE INTAKE BACK TO THE PUMP STATION. THOSE SHAFTS HAVE BEEN DONE AND YOU CAN SEE A, A, UH, RAISED BORE MACHINE ON THE RIGHT THAT WAS USED TO CONSTRUCT THOSE SHAFTS. AND IN ADDITION TO THAT, UH, THEY COMPLETED A COUPLE COMPLEX SHAFTS FROM THE MAINTENANCE BUILDING SITE DOWN TO THE INTAKE TUNNEL. THAT WILL CONVEY INVASIVE MUSCLE CONTROL CHEMICALS INTO THE SYSTEM SO THAT ONCE WE, ONCE WE ACTIVATE THE SYSTEM AND START MOVING WATER, IT WILL NOT GET INFESTED BY ZEBRA MUSSELS. THAT'S THE KIND OF BIZARRE PHOTOGRAPH THERE IN THE MIDDLE WHERE YOU CAN SEE THE REAMER AND THE PILOT HEAD POKING THROUGH THE TUNNEL. LOOKING FORWARD, UM, SOME OF THE MAJOR UPCOMING ACTIVITIES, UH, THE CONTRACTOR IS RIGHT NOW WORKING ON TYING IN THOSE INTAKE RISERS INTO THE INTAKE TUNNEL. THE TUNNEL WENT BENEATH THE INTAKE RISER PIPES, THEN THEY EXCAVATED UP AND ARE TYING IN THOSE RISER PIPES TO THE TUNNEL SYSTEM BELOW. SO THERE'S SOME ADDITIONAL STEEL WORK AND WELDING THAT NEEDS TO BE COMPLETED. AND THEN THERE'S A, A LOT OF REINFORCING THAT WILL BE, UH, ADDED AROUND THOSE TWO CONNECTIONS TO TIE INTO THE CONCRETE TUNNEL FORM WORK THAT'LL COME IN LATER. ONCE THAT HAS BEEN DONE, THE CONTRACTOR'S GONNA MOVE INTO SOME EXTENSIVE CONCRETING WORK WHERE THEY'LL LINE THE 9,000 FOOT INTAKE TUNNEL STARTING OUT AT THE INTAKE UNDER THE LAKE AND WORKING BACK TO THE MAIN SHAFT THAT I KNOW MANY OF YOU HAD AN OPPORTUNITY TO TOUR. AND YOU CAN SEE A PHOTOGRAPH OF THAT FORM WORK, WHICH IS A SPECIALTY FORM WORK THAT THEY PROCURED FROM ITALY FOR THAT CASTING SYSTEM WHERE THEY'RE ABLE TO ERECT IT, PLACE CONCRETE AROUND IT, AND THEN IT COLLAPSES INSIDE OF THE TUNNEL ON ITSELF AND THEY'RE ABLE TO MOVE IT OUT FOR THE NEXT CONCRETE PLACEMENT. SO A VERY SOPHISTICATED CONCRETE OPERATION. SO BEFORE I JUMP TO PHASE 1D, ARE THERE ANY QUESTIONS I CAN ANSWER ON PHASE TWO? ANY QUESTIONS ON THIS ITEM? UH, JUST A QUICK QUESTION FOR ME. ON THE, UH, WHEN WHEN WE WERE DOING THE, THE, I GUESS THE MORE COMPLEX WORK WATER WORK, WAS IT AN ADVANTAGE TO HAVE A LOWER WATER LAKE LEVEL TO, TO GET SOME OF THAT DONE I ASSUME OR? ABSOLUTELY. THAT WAS A REAL ADVANTAGE DURING CONSTRUCTION. [00:10:01] IT WAS ONLY A DRAWBACK WHEN THEY NEEDED TO REMOVE A VERY LARGE CRANE THAT WAS ON THAT FLOATING PLATFORM THAT THEY HAD OUT OF THE LAKE WHERE THEY HAD LAUNCHED. IT WAS NO LONGER ACCESSIBLE OH WOW. FOR THEM TO ROLL THAT CRANE OFF. SO THAT ENDED UP BEING A BIT OF A DEAL FOR THEM, BUT THEY FIGURED IT OUT. AND THEN JUST ON THE MAIN TUNNELING, WAS THERE ANY, UH, ANY HICCUPS ALONG THE WAY, ANY VOIDS OR CAVERNS THAT THEY HAD TO DEAL WITH THAT WERE NOT EXPECTED OR NO SURPRISES WHATSOEVER? THE GROUND WAS EXCELLENT AND THE CONTRACTOR HAS REMARKED MANY TIMES THAT THEY WERE, THEY FELT FORTUNATE TO DO SOME TUNNELING AND ROCK LIKE THAT. THAT'S KIND OF A TUNNELLERS DREAM TO GET IN THERE AND MINE VERY CONSISTENT IN SOFT ROCK. YEAH. SO THEY MADE SOME VERY QUICK PRODUCTION AND THEY COMPLETED SOME OF THAT MINING OPERATION A COUPLE OF MONTHS AHEAD OF WHERE THEY HAD ANTICIPATED IN THEIR ORIGINAL SCHEDULE. OF COURSE. SO SOMETHING WE WERE TALKING ABOUT DURING UH, WHEN WE DID A TOUR WAS, YOU KNOW, SOME PEOPLE THINK THAT BECAUSE WE FINISHED A LITTLE AHEAD OF SCHEDULE THAT THAT SPEEDS A TIMELINE UP, BUT Y'ALL WERE TELLING US HOW EVERYTHING'S SO SPECIALIZED FOR, FOR WHAT WE'RE DOING, THAT THERE'S, EVERYTHING'S ON A TIMELINE AND SO IT'S REALLY HARD TO ALMOST IMPOSSIBLE TO SPEED UP THE PROCESS. YEAH. EVEN THOUGH SOME OF THOSE OPERATIONS ENDED AHEAD OF SCHEDULE IT, IT WOULD BE DIFFICULT AT THIS POINT TO SAY THAT THEY ARE DEFINITIVELY AS A PROJECT WITH MULTIPLE YEARS OF WORK IN FRONT OF THEM AHEAD OF SCHEDULE BY MANY MONTHS THEY'VE DEFINITELY GIVEN THEMSELVES SOME MARGIN I THINK TO WORK WITH. THERE'S STILL ALL KIND OF DISRUPTIONS IN SUPPLY CHAIN, ESPECIALLY WHEN WE GET TO THE ELECTRICAL SIDE, WHICH WE HAVEN'T REALLY STARTED ON THIS PROJECT. THEY'RE SURPRISED IS EVERY DAY ON MOST OF THESE LARGE PROJECTS AROUND TEXAS. SO THINGS WILL COME UP, BUT THEY'VE PUT THEMSELVES IN A REALLY GOOD POSITION TO BE ABLE TO FINISH THE PROJECT ON TIME, POTENTIALLY A LITTLE BIT AHEAD OF SCHEDULE. ALRIGHT, NEXT. OKAY, SO PHASE 1D WATER TREATMENT PLANT EXPANSION. THIS EXPANSION WILL TAKE THE CAPACITY OF THE WATER TREATMENT PLANT FROM ABOUT 32 AND A HALF MGD TO JUST UNDER 42 MGD. THE CONTRACTOR WAS GIVEN A NOTICE TO PROCEED IN MAY OF LAST YEAR. SO THEY'RE ABOUT 45% OF THE WAY THROUGH THEIR SCHEDULE WITH FINAL COMPLETION SCHEDULED FOR JANUARY OF NEXT YEAR. AT THIS POINT, THE CONTRACTOR FOR THE WATER TREATMENT PLANT EXPANSION IS BEHIND SCHEDULE. THEY HAD SOME RESOURCING ISSUES WHERE ANOTHER PROJECT FINISHED LATE AND SO THEY'VE MOVED THEIR CREW OVER LATE AND WE'VE BEEN WORKING WITH THIS CONTRACTOR TO TRY TO HAVE THEM DEVELOP A PLAN TO CATCH UP, INCLUDING JUST THIS MORNING A CONSTRUCTION PROGRESS MEETING WHERE THEY'VE BEEN GIVEN SOME ENCOURAGEMENT TO MOVE MORE QUICKLY ON THE PROJECT ON A CONTRACT, UH, STATUS COST BASIS, THE CONTRACT IS JUST UNDER 17 MILLION AND THEY'VE BILLED ABOUT 2 MILLION OR ABOUT 10% OF THE PROJECT. SO THIS CONTRACTOR'S DEFINITELY LOOKING FOR OPPORTUNITIES TO ACCELERATE THEIR SCHEDULE TO GET BACK ON TRACK. SOME OF THE MAJOR WORK COMPLETED TO DATE, THEY'VE DONE THE MAJOR EXCAVATIONS FOR THE NEW TREATMENT TRAIN AND THE EXCAVATIONS FOR THE TWO LARGE RAW WATER STORAGE TANKS. THEY'VE ALSO DONE THE STRUCTURAL SLAB PLACEMENT FOR THE NEW TREATMENT STRUCTURE AND THEY'VE BEEN WORKING NOW ON PREPARING TO POUR THE WALLS AND THE WALKWAYS FOR THAT TREATMENT STRUCTURE. SO A LOT OF CONCRETE WORK, A LOT OF REBAR WORK TO DATE AND, AND UPCOMING. AND THEN THEY'LL ALSO START WORKING ON CONSTRUCTING THOSE RAW WATER STORAGE TANKS AS WELL. ANY QUESTIONS ON PHASE 1D? ANY QUESTIONS SIR? ALRIGHT. ALRIGHT, LET'S KEEP GOING. THE UNDERWATER PIPELINE REPLACEMENT PROJECT, UH, AS YOU RECALL, I KNOW WE TALKED ABOUT IT MANY TIMES, IS REPLACING A LARGE SECTION OF THE UNDERWATER PIPELINE THAT HAS BEEN SUBJECT TO MULTIPLE FAILURES. THE CONTRACTOR WAS GIVEN NTP IN FALL OF LAST YEAR AND THEIR FINAL COMPLETION DATE IS JUNE. SO THEY'RE ABOUT 65% OF THE WAY THROUGH AND THEY'RE ON SCHEDULE AT THIS POINT. THE CONTRACT VALUES ABOUT $7 MILLION AND THEY'VE BILLED ABOUT $2 MILLION. WE HAVE HAD ONE CHANGE ORDER, BUT IT WAS A NO COST CHANGE ORDER FOR SOME CHANGES THAT THEY PROPOSED. SOME OF THE MAJOR WORK COMPLETED ON THIS PROJECT INCLUDE THE DRILLING AND PREPARATION OF THE PIPE SUPPORT ON THE LAKE BED, AND THEN THE CONTRACTOR HAS TAKEN THE 36 INCH DIAMETER PIPE AND LAID IT OUT ALONG THE LAKE BED, ASSEMBLED IT WHERE THEY COULD, AND THEN PREPARED IT TO TIE INTO THE EXISTING PIPELINE AT BOTH ENDS OF THE NEW PIPELINE. THE BE SURE UA WATER TREATMENT PLANT, UH, WAS [00:15:01] TAKEN OUTTA SERVICE ON MONDAY OF THIS WEEK IN PREPARATION FOR A 30 DAY SHUTDOWN PERIOD WHERE THE CONTRACTOR WILL DRAIN THE RAW WATER LINE AND HAVE THE OPPORTUNITY TO MAKE THOSE TWO TIE-INS ON BOTH ENDS, NEW PIPE TO EXISTING PIPE. AND WHILE THEY'VE GOT THE SYSTEM DOWN, WE ALSO HAVE THEM ON TAP TO REPLACE SEVERAL RAW WATER LINE VALVE ACTUATORS THAT WE CAN'T REPAIR UNLESS A RAW WATER LINE IS DOWN. SO THIS IS AN OPPORTUNITY TO COMPLETE SOME ADDITIONAL REPAIRS DURING THIS 30 DAY OUTAGE PERIOD. ONCE THEY'VE COMPLETED TYING IN THAT PIPELINE, THE PIPELINE WILL BE FILLED AND TESTED AND WE ANTICIPATE BE SURE UUA WILL RESUME OPERATION AND START DISTRIBUTING WATER TO THE CUSTOMER CITIES AT THE END OF MARCH. ANY QUESTIONS THAT I CAN ANSWER ON THE UNDERWATER PIPELINE? ANY QUESTIONS? LOOKING FORWARD TO THAT ONE BEING COMPLETED FOR SURE. ABSOLUTELY. GO AHEAD. CAN YOU GO BACK TO THE FIRST SLIDE? I'M SORRY FOR THIS ONE. THANK YOU. UM, THANK YOU. THAT'S WHAT I NEED. ONE THING I SHOULD NOTE ABOUT THE CONTRACTOR'S WORK DURING THIS, UH, OUTAGE PERIOD, WHEN BE SURE UA WATER TREATMENT PLANT IS OUTTA SERVICE, UH, THEY ARE INTENDING TO WORK AND, AND HAVE CREWED UP TO WORK SEVEN DAYS A WEEK, 24 HOURS A DAY. SO THIS IS GONNA BE A MAJOR EFFORT ON THEIR PART. BY THE TIME THEY SUBMIT ANOTHER PAY APPLICATION AFTER THIS 30 DAY PERIOD, THEY WILL NOT BE 25% BILLED, THEY WILL BE CLOSE TO COMPLETELY BILLED. THIS IS, THIS IS THE MAJORITY OF THE WORK ON THE PROJECT. AND YOU SAID, UH, THE CONNECTIVITY PART OF THE PROJECT WILL BE DONE IN, IN MARCH AT THE END OF MARCH. B-C-R-U-A SHOULD RESUME OPERATION. OKAY. AND THEN, SO THE, THE PERIOD BETWEEN MARCH AND JUNE, WHAT'S THAT CONSISTING OF AS FAR AS COMPLETING THE PROJECT? YEAH, AT THAT POINT WE SHOULD RESUME OPERATIONS. SO SUBSTANTIAL COMPLETION SHOULD BE THERE. THE FINAL COMPLETION, THEY'LL HAVE SOME ADDITIONAL WORK THAT WE'RE HAVING THEM DO ON THE RAW WATER LINE AND SOME CLEANUP. BUT THE MAJORITY OF THE WORK, INCLUDING THE CRITICAL PATH WORK, WHICH ALLOWS US TO RESUME OPERATION, WILL BE COMPLETE AT THAT POINT. OKAY. THERE ARE, THERE'S TWO KEY DATES IN MOST CONSTRUCTION CONTRACTS, SUBSTANTIAL COMPLETION WHERE WE CAN OPERATE THE SYSTEM AND FINAL COMPLETION WHERE WE'VE TAKEN CARE OF ALL THE PUNCH LISTING AND ALL OF THE ADDITIONAL ITEMS. YES, SIR. SO AARON, THE, UH, THE EXISTING PIPELINE WILL JUST STAY IN PLACE. I MEAN, IT'S NOT GONNA BE DECONSTRUCTED OR TAKEN DOWN. THAT'S RIGHT. WE'RE NOT GONNA REMOVE THE EXISTING PIPELINE AT THIS TIME. THANK YOU. OKAY. NEXT. OKAY, ONWARD TO DELIVERY POINT IMPROVEMENTS. I KNOW WE'VE ALSO TALKED MULTIPLE TIMES ABOUT THE DELIVERY POINT IMPROVEMENTS PROJECT, WHICH IS TO INCREASE THE FUNCTIONALITY AND THE OPERATIONAL CONTROL OF THE DELIVERY POINTS TO EACH OF THE CITIES ON THE FINISHED WATER SYSTEM COMING OUT OF THE PLANT. THIS PROJECT WAS BROKEN INTO TWO PHASES. UH, PHASE ONE OF THE PROJECT HAS BEEN AWARDED. NTP WAS GIVEN TO THE CONTRACTOR LATE LAST YEAR. FINAL COMPLETION IS SCHEDULED FOR A SUMMER OF THIS YEAR AND THIS PROJECT IS ON SCHEDULE. IT'S A VERY SMALL PROJECT MOSTLY RELATED TO, UH, INSTRUMENTATION AND CONTROL TYPE WORK. THE CONTRACT VALUE IS UNDER HALF A MILLION DOLLARS AND UH, WE HAVE HAD NO CHANGE ORDERS TO DATE. WE HAVE NOT RECEIVED A PAY UP TO DATE. THE CONTRACTOR'S MOSTLY BEEN PREPARING AND GOING THROUGH SUBMITTAL REVIEWS IN ORDER TO GET THIS WORK COMPLETED. THE SECOND PHASE OF THE DELIVERY POINT IMPROVEMENTS PROJECT DOES INCLUDE MORE WORK IT DOES INCLUDE OF SOME PROCESS MECHANICAL WORK REPLACING OF SOME CRITICAL VALVES. UH, THIS PROJECT IS CURRENTLY BIDDING WE'LL OPEN PROPOSALS ON MARCH 6TH. AND THEN WE DO ANTICIPATE BRINGING THIS CONSTRUCTION CONTRACT BACK TO YOU ON MARCH 27TH FOR APPROVAL FOLLOWED BY THE CITY COUNCILS. UH, THE ESTIMATED COST OF THIS CONTRACT IS ABOUT $1.6 MILLION AND SUBSTANTIAL COMPLETION WHERE THESE NEW VALVES AND IMPROVEMENTS WILL BE OPERATIONAL IS SCHEDULED FOR MAY OF NEXT YEAR. ANY QUESTIONS ON DELIVERY POINTS? Y'ALL GOOD? GO BACK TO ONE SLIDE. OKAY, THANK YOU. OKAY. TO OUR LAST PROJECT THEN THE PHASE TWO, A WATER TREATMENT PLANT EXPANSION. UH, THE LAST TIME WE TALKED ABOUT THIS PROJECT, WE ARE ENTERING A PHASE IN WHICH WE INTENDED TO DEVELOP THE SCOPE FOR PHASE TWO A. IT WAS THE FIRST PROJECT WHERE WE MOVED OUTSIDE OF KIND OF THE EXISTING TREATMENT STRUCTURE AT THE PLANT SITE. AND SO WE DID AN EVALUATION WHERE WE LOOKED AT WHAT WE THOUGHT THE CAPACITY OF THIS EXPANSION COULD BE. WE LOOKED AT WATER QUALITY, [00:20:01] KIND OF THE TREATMENT HISTORY OF THE WATER TREATMENT PLANT TO DETERMINE IF CONTINUING FORWARD WITH THIS TYPE OF PLANT DESIGN MADE SENSE FOR PHASE TWO A. AND HAVING COMPLETED THAT EVALUATION, WE DETERMINED THAT IT, IT IS LOGICAL TO CONTINUE BUILDING OUT THE PLANT PER THE ORIGINAL 2008 MASTER PLAN. USING THE SAME TYPE OF TREATMENT TECHNOLOGY. AND SHOWN IN LIGHT GREEN ARE THE STRUCTURES THAT ARE GONNA BE INCLUDED IN PHASE TWO A. IT INCLUDES TWO NEW TREATMENT TRAINS AT THE WATER PLANT IN A STRUCTURE THAT'LL BE JUST SOUTH OF THE EXISTING MAIN OR CENTRAL TREATMENT STRUCTURE. UH, WE'RE MOVING THE 6 MILLION GALLON CLEARWELL INTO THIS PROJECT. THERE'LL BE AN EXPANSION OF THE DIXON INFECTION CHAMBER. WE'VE GOT, UM, SOME ADDITIONAL BOOSTER PUMP THAT WE NEED TO ADD TO CONVEY TREATED WATER OUT OF THE PLANT TO THE CUSTOMER DELIVERY POINTS. AND THEN THERE'S A NUMBER OF CHEMICAL FEED SYSTEM IMPROVEMENTS THAT WE NEED TO MAKE TO MATCH THE INCREASED CAPACITY OF THE WATER TREATMENT PLANT. WHEN PHASE TWO A COMES ONLINE, WE ANTICIPATE PHASE TWO A WILL INCREASE THE CAPACITY OF THE WATER PLANT BY 22.3 MGD. UH, THAT WILL BREAK OUT AS 11.7 MGD TIL LEANDER AND 10.6 MGD TO ROUND ROCK. AND THEN CEDAR PARK IS NOT A PARTICIPANT IN PHASE TWO A, SO NO CAPACITY ALLOCATION TO THEM WITH THE IN 2027 WHEN THE PLANT COMES ONLINE AND THE NEW CAPACITY IS 64.2 MGD, 11.2 MGD OF THAT SUPPLY WILL BE CEDAR PARK. 31.2 WILL BE LEANERS AND 21.8 WE'LL GO TO ROUND ROCK. LOOKING FORWARD ON PHASE TWO A, WE ANTICIPATE MOVING INTO FINAL DESIGN, UH, AT THE END OF MARCH. AND THAT TAKING INCLUDING FINAL DESIGN AND PERMITTING THROUGH ABOUT MAY OF NEXT YEAR, AT WHICH POINT WE'LL MOVE INTO BIDDING AND PROCUREMENT, UH, BRING BACK A CONSTRUCTION CONTRACT TO THE BOARD FOR CONSIDERATION AT THE END OF SUMMER NEXT YEAR AND THEN LAUNCH INTO CONSTRUCTION WITH A SUBSTANTIAL COMPLETION TARGET DATE OF MAY, 2027 TO ALIGN THE TWO A EXPANSION WITH THE PHASE TWO COMPLETION DOWN ON LAKE TRAVIS. OKAY. CAN I ENTERTAIN ANY QUESTIONS ON TWO A? ALRIGHT, ANY QUESTIONS AARON? NO, I THINK SO. THANK YOU. THANK YOU. THANKS . YOU GOT A FAN CLUB. WOW. FAN CLUB, SAM. ALRIGHT. YES, GOOD EVENING, MR. PRESIDENT AND DIRECTORS. I, UH, MY NAME'S SAM ROBERTS. I'M THE NEW GENERAL MANAGER. IT'S MY FIRST NIGHT AND I, I'VE GOT A LITTLE FIRST NIGHT JITTERS, BUT, UH, I WANTED TO ADD JUST A COUPLE OF SLIDES TO, TO AARON SLIDE DECK TO TALK A LITTLE BIT ABOUT KIND OF OPERATIONS AND STUFF AND WHAT'S ON THE HORIZON. UH, I FELL IN LOVE WITH THIS SHOT SINCE, UH, IT WAS SHOWN IN ONE OF AARON'S IN PHASE 1D. 'CAUSE THAT THAT'S ONLY A FEW WEEKS OLD. OH, SORRY. I WAS, I FELL IN LOVE WITH THIS PICTURE RIGHT HERE BECAUSE IT'S, IT'S ONLY A FEW WEEKS OLD AND IT'S 1D OF COURSE IT'S, IT'S A PICTURE OF 1D BUT WHAT I LIKE ABOUT IT, IT REALLY ENCOMPASSES MORE THAN THAT 'CAUSE WHAT IT SHOWS AND UH, THE NEXT SLIDE KIND OF HELPS WITH THIS, BUT I WANTED TO KIND OF MENTION THIS. THE, EVERYTHING WE DO, WELL, LET ME BACK UP. THAT SHOWS CONSTRUCTION AND IT SHOWS OPERATION AND ALL THAT TAKES A LOT AND ALL OF THAT TAKES A LOT OF MONEY. AND WHAT REALLY FASCINATES ME IS, IS WHAT THIS, WHAT DRIVES ALL THIS AND THIS, THE ENTIRE PURPOSE OF THE CREATION OF THE B-E-C-R-U-A IS DRIVEN BY THE MASTER AGREEMENT, WHICH WAS APPROVED IN 2008. AND IN THAT AGREEMENT IT SAYS THE EXPRESS PURPOSE OF THE P-C-R-U-A IS TO CREATE A VEHICLE TO FINANCE, CONSTRUCT, OPERATE, OWN, AND MAINTAIN THE SYSTEMS TO PROVIDE REGIONAL WATER SUPPLY. AND, AND THE [00:25:01] THREE THAT STICK OUT IN MY MIND, 'CAUSE THEY'RE REALLY BIG PICTURE, IT'S, WE CONSTRUCT THINGS, WE FINANCE THINGS, WE CONSTRUCT THINGS AND WE OPERATE THINGS. AND RIGHT HERE WE'VE GOT TWO OF THOSE ON CONSTRUCTION AND OPERATION. AND, AND THEN OF COURSE, YOU KNOW, Y'ALL KNOW ABOUT THE FINANCING 'CAUSE THERE'S A LOT OF THAT ALWAYS GOING ON. SO ANYHOW, I JUST WANTED TO MENTION THAT. 'CAUSE UH, 'CAUSE IT'S MY, MY JOB, IF YOU LOOK AT MY JOB DESCRIPTION, IT'S, IT'S ALL THREE OF THOSE. AND ALTHOUGH MY BACKGROUND IS REALLY, REALLY MORE CONSTRUCTION AND OPERATIONS, I, UH, I, I DABBLE OKAY. IN FINANCE AND, UH, AND, AND THEY'RE, AND THEY'RE TEACHING , UH, AND, AND THIS SLIDE. SO I WANTED TO MENTION, I KNOW I'VE SEEN THE, THE SLIDE Y'ALL BEEN USING FOR A WHILE THAT SHOWS THE, THE, THE, THE PHASING, I THINK THIS HAS BEEN CALLED THE PLANT PHASING. AND, AND, AND I'M GLAD TO SEE AARON HAS KIND OF UPDATED THAT WITH HIS, WITH THE, UH, PHASE TWO A REPORT. SO YOU'LL SEE THAT WE WILL, WE'LL PROBABLY BE PHASING OUT THE OLD PHASING CHART AND WE'LL BE USING THIS ONE AND, UH, AND KEEPING IT UP TO DATE FOR Y'ALL. SO THE 30 DAY SHUTDOWN, SO THAT, YOU KNOW, AARON EXPLAINED ALL THAT, THE SHUTDOWN, UH, TO ALLOW THE COMPLETION OF THE UNDERWATER PIPELINE. THAT'S A BIG DEAL. 'CAUSE WHEN THAT PROJECT'S AT THE END OF 30 DAYS, IF ALL GOES WELL, IF THAT UNDERWATER PIPELINE'S FINISHED. AND, AND, UH, EXCEPT FOR THE ALL THE PUNCH LISTS AND STUFF LIKE THAT. WELL, DURING THIS 30 DAYS, YOU KNOW, AND I'M NOT, I'VE NEVER BEEN INVOLVED IN CRIME SHUTDOWN DOWN, DRAINING ALL THE WATER OUTTA THAT PLANT. UH, WAS WAS IT, WE TOOK A LOT OF PREPARATION AND, AND WE, WE PUT A LOT OF TIME INTO, UH, GETTING READY FOR THIS. AND IN THIS PICTURE, IF YOU LOOK, YOU CAN SEE ONE OF THE BA AT THE TOP PICTURE, ONE OF THE BASINS IS EMPTY. AND ACTUALLY THERE'S, THERE'S THREE BASINS. THEY'RE CALLED TRAINS AND LIKE BIG GIANT SWIMMING POOLS. TWO OF 'EM ARE EMPTY NOW. ONE OF 'EM, WE'RE KEEPING WATER IN RIGHT NOW 'CAUSE WE'RE USING IT FOR OTHER PURPOSES AND FOR AT LEAST FOR THE NEXT FEW DAYS. AND THEN THE PICTURE ON THE BOTTOM, THAT'S ONE WE JUST GOT THROUGH CLEANING. AND, AND THAT'S LIKE WHAT WE'VE GOT THIS LIST OF THINGS WE'RE DOING ALL MONTH OF A PRETTY ROBUST LIST OF STUFF THAT'S, UH, REALLY NEEDS TO BE DONE. AND IT'S A GOOD TIME TO DO IT. AND, AND THE REALLY FIRST THING WAS DRAINING. DRAINING THE PIPELINE, YOU KNOW, DRAINING THAT PIPELINE. IT'S LIKE SEVEN MILES LONG AND IT TOOK ALMOST 24 HOURS TO DRAIN ALL THE WATER OUT OF IT. AND THAT WAS KIND OF A BIG DEAL. AND THAT'S DONE. AND IN THE TANK, IN THE, IN THE PLANT, THE PLANT IS NOT PRODUCING WATER. WE'VE MOVED ALL THE OPERATORS EXCEPT FOR ONE TODAY'S SHIFT. SO THEY CAN ALL, WE CAN KEEP 'EM BUSY DOING ALL KINDS OF DEFERRED MAINTENANCE AND CLEANING AND ALL KINDS OF STUFF. AND I JUST WANTED TO MENTION A COUPLE, COUPLE OF THEM. WE'VE GOT SOME REPAIRS IN THE SEDIMENTATION BASIN. ONE, OR ACTUALLY TWO OF 'EM HAVE THESE SCRAPERS THAT HAVE BEEN MI MISSING FOR A LONG TIME. WE'RE REPLACING THOSE, WHICH IS REALLY NOT EASY. AND THE BASIN HAS TO BE EMPTY. AND THEN, AND THEN THE RAW WATER PUMPS AND THE HIGH SERVICE PUMPS. WE'VE GOT SOME REALLY IMPORTANT ELECTRICAL REPAIRS THERE. SO IN THE FALL WE DID A, WHAT'S A PRETTY EXPENSIVE STUDY ON THE RAW WATER PUMPS? THE ONES ON THE FLOATING BARGE, THOSE ARE BIG HIGH, WELL I THINK THEY CALL 'EM MEDIUM VULTURES. THEY'RE HIGH VULTURE, THEY'RE BIG PUMPS. AND THEY DELIVER ALL THE RAW WATER UP TO THE PLANT. AND THEY HADN'T BEEN TESTED IN A LONG TIME. SO WE DID A PRETTY EXPENSIVE TEST. AND THE TEST IDENTIFIED SOME NOT SO EXPENSIVE, BUT REALLY IMPORTANT, UH, REPAIRS AND, AND, AND GE GENERAL CARE AND MAINTENANCE, CLEANING OF ALL THESE THINGS AND REPLACING SOME CONDUCTORS AND BLAH, BLAH, BLAH. WE'RE GONNA DO THAT. SAME THING GOES WITH THE HIGH SERVICE PUMPS AT THE TREATMENT PLANT. YOU'VE GOT THESE BIG HIGH SERVICE PUMPS AND THEY TAKE EVERY BIT OF WATER THAT GETS TREATED AND PUMPS IT UP INTO THAT BIG ELEVATED STORAGE TANK. AND THOSE ARE HUGE. THOSE TWO, THOSE TWO SETS OF PUMPS ARE REALLY IMPORTANT. AND WE DID THE SAME THING WITH THAT. WE DID A, A TEST, A STUDY AND, AND IT IDENTIFIED A BUNCH OF REALLY IMPORTANT STUFF. SO WE'RE GETTING THAT DONE. THIS MUD, UH, THERE'S SOME, WE'RE DOING SOME BASIN CONCRETE REPAIRS THAT'S OLD, UH, OLD REPAIRS THAT HAD HAD NOT BEEN DONE. AND WE'LL PAINT A LOT OF, WE'RE DOING A LOT OF PAINTING. AND THEN JUST, UH, EVERY PUMP, EVERY MOTOR, UH, WE'RE GOING THROUGH. 'CAUSE WE HAVE TONS AND TONS AND TONS OF PUMPS, AL PUMPS, WATER PUMPS. I I MEAN, YOU NAME IT, THEY'VE GOT IT. AND, AND, UH, SO, SO ANYWAY, WE'RE GONNA HAVE A BUSY MONTH AND I JUST WANTED TO LET Y'ALL KNOW THAT, UH, ON THE HORIZON, UH, I THINK AARON MENTIONED THIS, THE, UH, AND WHEN I SAY ON THE HORIZON, WE'RE ALREADY TALKING MAINLY NEXT MONTH, UH, AT THE NEXT, AT THE MARCH MEETING, THE, WE'RE GONNA HAVE THE, THE PHASE TWO A ENGINEERING CONTRACT TO Y'ALL. THE OCS GOING TO THE OC HAS ALREADY [00:30:01] HAS HAS, IT'S BEEN DELIVERED TO THE OC FOR REVIEW. AND WHEN WE HAVE OUR MONTHLY MEETING IN TWO WEEKS, WE'RE GONNA GO THROUGH THAT AND, AND HAVE A RECOMMENDATION FOR Y'ALL ON THE 26TH. I BELIEVE IT'S, UH, YEAH, DELIVERY POINTS, PHASE TWO BID OPEN. AND WARD AARON MENTIONED THAT THAT'S, UH, UH, THAT'S IMPORTANT PROJECT AND THAT SHOULD BE TO Y'ALL. AND THEN, AND THESE AREN'T, I'M NOT A HUNDRED PERCENT SURE THESE ARE COMING, BUT THE PEC PERMANENT POWER AGREEMENT, Y'ALL MAY HAVE HEARD ABOUT THAT. IT'S A, IT'S A HUGE CRITICAL PATH ITEM FOR FINISHING THE ENTIRE PROJECT. AND WE, UH, WE HAVE FINISHED THE AGREEMENT AND WE THINK IT'S, IT'S IN FINAL FORM. AND, AND STEVE SHEETS IS WORKING WITH THE PDC ATTORNEY. AND WE HOPE TO HAVE THAT AGREEMENT TO Y'ALL, UH, IN MARCH. AND WE'RE TRYING VERY HARD TO DO THAT. WE ARE ALSO WORKING ON THE LAST, HOPEFULLY IT WILL BE ONE OF THE LAST BIG PEC UNITS IS THE NAMELESS SUBSTATION. YOU MAY RECALL, ONE OF THE OTHER THINGS WE HAVE TO PAY FOR TO PROVIDE POWER TO THE PHASE TWO IS WE HAVE TO HELP PAY FOR AN EXPANSION OF ONE OF THEIR ELECTRICAL SUBSTATIONS ON NAMELESS ROAD. AND, AND SO WE'VE BEEN, UH, WORKING ON, ON AN AGREEMENT WITH THEM ON THAT. AND WE, UH, THAT WILL PROBABLY NOT BE READY IN MARCH, BUT HOPEFULLY SOON THEREAFTER. 'CAUSE IT'S ALSO CRITICAL PATHO. AND LASTLY, UH, AND I , I I MEANT TO TALK TO STEVE ABOUT THAT THIS WEEK. I HAVE IT, I KNOW THERE'S A DRAFT FLOATING AROUND, I THINK YOU CALLED IT AMENDMENT NUMBER SEVEN, BUT WE NEED TO ADD PHASE TWO A TO THE MASTER AGREEMENT AS BEING, AS PART OF THE SYSTEM. AND SO IT WON'T BE A VERY DIFFICULT AMENDMENT TO DO. BUT THAT'S ON MY KIND OF TO DO LIST AND GET DONE AND GET TO Y'ALL. AND WE, UH, I'M GONNA TALK TO STEVE TOMORROW. WE MAY NEED TO HAVE IT TO Y'ALL IN MARCH TO GO WITH THE, UH, ENGINEERING CONTRACT APPROVED. AND, AND WITH THAT, THAT, THAT'S ALL I HAVE. ANY QUESTIONS OF SAM? NO, THANKS, DIRECTOR FLORES. HEY, SAM, BACK TO YOUR SLIDE ON ALL THE REPAIRS THAT YOU'VE, UH, DONE TO THE FACILITY WHILE THE, WHILE THE WATER'S OUT, IS THAT JUST CONSIDERED A REGULAR BUDGET LINE ITEM AS FAR AS REGULAR MAINTENANCE AND REPAIR? OR IS THERE SOMETHING EXTRAORDINARY ABOUT THE COST INVOLVED WITH ALL THAT STUFF? WELL, WHAT I WOULD TELL YOU, UH, DIRECTOR, IS THAT THERE'S A, THERE'S A LOT OF STUFF WE'VE BEEN HAVING TO DO. I'D CALL IT DEFERRED MAINTENANCE, THAT IT'S PRETTY EXPENSIVE, THAT, YOU KNOW, WHAT IS PROBABLY NOT COMPLETELY ENCOMPASSED IN THE BUDGET. AND WHEN WE START GOING THROUGH THE BUDGET THIS IN THE NEXT MONTH OR TWO, I, I PLAN ON LOOKING AT THAT REAL CAREFULLY. UM, YEAH, YEAH, WE WILL PROBABLY EXCEED SOME OF OUR LINE ITEMS. AND MY COMMENT TO THAT IS, YEAH, WE SHOULD AND, AND 'CAUSE WE, THIS IS A HUGE PLAN AND, AND THERE'S WITH THE, WITH THE MARKET AND THE DIFFICULTY OF HAVING OPERATORS AND I, I DON'T THINK EVERYTHING WE HAS BEEN KEPT UP AS WE WOULD'VE LIKED IT TO. UM, AND YEAH, SOME OF THESE, BUT, BUT THESE ARE, THESE ARE ROUTINE, UH, YEAH, THESE ARE DEFINITELY ROUTINE, UH, MAINTENANCE COSTS. AND SO IT JUST, I THINK WE, WE GOT A BUNCH COMING AT ONE TIME. YEAH. AND I, I DON'T HAVE ANY CONCERNS ABOUT, I MEAN, I THINK IT MAKES SENSE TO, TO GET IT DONE AND GET IT AS GOOD AS YOU CAN HAVE IT. I, BUT I GUESS THIS HASN'T, WE HAVEN'T HAD THE OPPORTUNITY TO DO THIS SINCE THE PLANT WAS PUT IN PLACE IN 2008. IS THAT, IS THAT A FAIR COMMENT? WELL, WELL, NOT ENTIRELY, BUT, BUT THIS IS A GOOD OPPORTUNITY TO DO IT. AND, AND HAVE YOU BEEN ABLE TO PUT MORE WATER IN THE LAKES FOR US? ? I WISH I HAD A MAGIC WAND TO DO THAT. OTHER QUESTIONS THE SAME, AND I'LL, I'LL ECHO THAT STATEMENT. I, I'D BE VERY SUPPORTIVE OF SEEING A, A ROBUST MAINTENANCE PLAN AND US INVESTING IN THE MAINTENANCE OF THAT PLAN. IT'S, IT'S VITALLY IMPORTANT TO ALL OF US. SO IF, IF IT'S NOT THERE, IF YOU WANNA BRING US SOMETHING TO CONSIDER, PLEASE, PLEASE DO. ABSOLUTELY. I HAD, I HAD JUST A CURIOSITY QUESTION. YOU MENTIONED, YOU KNOW, YOU HAD YOUR WHOLE LIST OF THINGS THERE. AND AS FAR AS CLEANING, I GUESS YOU CALL THE TRAINS OR, OR TRAINS AND BASINS THE SAME THING. AM I USING, ARE THOSE INTERCHANGEABLE? WELL, THOSE AT, YEAH, THAT, THAT, THAT BIG SWIMMING POOL, THAT'S, THERE'S THREE OF THOSE. AND THAT'S REALLY PART, THAT'S THE TRAIN. OKAY. THERE'S THREE TRAINS. HOW OFTEN DO THEY NEED TO BE CLEANED? JUST OUTTA CURIOSITY, YOU KNOW, NOT IN PROBABLY EVERY THREE TO FIVE YEARS, YOU KNOW. YEAH. NOT THAT FREQUENTLY. AND, UH, SO, AND YOU CAN ONLY, YOU CAN DO 'EM IN THE WINTER. YEAH. WE, WE CAN DEWATER ONE OR TWO IN THE WINTERTIME. SO IT'S, IT'S NOT THAT DIFFICULT, ESPECIALLY NOW THAT WE KNOW HOW TO DO IT. 'CAUSE THERE'S NOBODY AT THE PLANT THAT'S EVER BEEN THROUGH A FULL DEWATERING. SO IT'S BEEN KIND OF FUN, BUT IT'S COMMON FOR PLANTS AND REFINES THE WINTER AT LEAST AMOUNT. THAT'S WHEN YOU GET YOUR LIST OF WINTER MAINTENANCE [00:35:01] CALLED WINTER MAINTENANCE. OKAY. GOOD. ALL RIGHT. ANY OTHER QUESTIONS? SO I, I JUST, UH, TO COMMENT AND ADD ON WHAT YOU SAID. IT'S GOOD THAT WE'RE STARTING TO WORK ON THESE, THESE POLICIES AND, AND WHEN DO CLEANINGS AND MAINTENANCE AND EVERYTHING ELSE THAT WE HADN'T HAD BEFORE, AND WE'VE HAD TO DEFER MAINTENANCE UNTIL IT ALL BUILDS UP AT ONE TIME. SO, UH, THIS IS JUST AN IMPORTANT PART OF THE PROCESS. SO THANK YOU VERY MUCH FOR SETTING THIS UP. ABSOLUTELY. AND I LIKE THE FACT THAT YOU MENTIONED THAT, YOU KNOW, IT WAS AN OPPORTUNITY TO GIVE VITAL TRAINING AS WELL, BECAUSE SOMETIMES WE CAN'T ALWAYS CREATE THE SITUATION WHERE SOMEONE NEEDS TO, YOU KNOW, BUILD A SKILLSET. AND I THINK THAT'S IMPORTANT. YEAH. BECAUSE WE DO KNOW THAT THAT HAS BEEN A CHALLENGE, I THINK, TO FIND THE RIGHT TALENT TO, TO BRING IN AND WE YEP. JUST CAN KEEP FOSTERING AND GROWING. I THINK THAT'S IMPORTANT TOO. GOOD. WHEN DO YOU ANTICIPATE BRINGING THE MAINTENANCE SCHEDULE BACK TO US? WITH THE BUDGET? WITH THE BUDGET? OKAY. MM-HMM. , THANK YOU. ALL RIGHT. THANK YOU. APPRECIATE IT LEADS US OR LEADS US TO, UH, ITEM SIX PRESENTATIONS. CONSIDER A PRESENTATION REGARDING THE FISCAL YEAR 2020 2 23 FINANCIAL AUDIT AND ACTION APPROVING THE SAME. GOOD EVENING. SORRY ABOUT THAT. SO WE NEED TO, WE NEED TO UPLOAD ON THIS. YES. Y'ALL CAN READ IT. CAN Y'ALL HEAR ME? I DON'T KNOW IF I CAN SCROLL THROUGH THE LETTER AND HAVE THE MICROPHONE. SAME. YEAH, TRY TO, TRY TO DO BOTH, JUST SO IT'S, THE VIDEO CAN PICK YOU UP. OKAY. UM, WELL, THANK YOU FOR HAVING ME. MY NAME IS REBECCA DARLING. I'M WITH, UM, WEAVER. WE ARE YOUR EXTERNAL AUDITORS FOR B-C-R-U-A. SO HAPPY TO BE HERE TONIGHT. UM, I THINK I HAD A SCHEDULING CONFLICT FOR YOUR JANUARY MEETING. SO WE DID ISSUE THE AUDIT RESULTS FOR THE 2023 FISCAL YEAR 2023 AUDIT FOR B-C-R-U-A. SO WHAT I WILL DO BRIEFLY TONIGHT IS JUST GO OVER WHAT I CALL MY REQUIRED COMMUNICATION. SO THAT'S IN A LETTER FORMAT. UM, AND THEN WE'VE ALSO ATTACHED THE AUDITED FINANCIAL STATEMENTS THEMSELVES FOR THE YEAR END, 9 30, 20 23. SO I DON'T PLAN TO GO OVER ALL OF THOSE NUMBERS FOR YOU GUYS, BUT I WILL TOUCH ON JUST SOME FINANCIAL HIGHLIGHTS AND CERTAINLY I CAN ANSWER SOME QUESTIONS IF YOU ALL HAVE THEM. UM, THE LETTER PROVIDED IN FRONT OF YOU IS, IS DIRECTED TO THE BOARD. AGAIN, THAT'S MY REQUIRED COMMUNICATION. SO WE AUDITED THE FINANCIAL STATEMENTS OF B-C-R-U-A, AS OF AND FOR THE YEAR ENDED SEPTEMBER 30TH, 2023. SO WE ISSUED OUR REPORT IN JANUARY 12TH. THAT'S OUR TYPICAL TIMELINE. WE TYPICALLY DO, WE, UM, YOU KNOW, OBVIOUSLY ALLOW MANAGEMENT TO CLOSE THE BOOKS AFTER NINE 30. WE DO MOST OF OUR AUDIT WORK IN A TWO, TWO WEEK PERIOD, UM, END OF NOVEMBER, RIGHT AFTER THANKSGIVING. AND THEN IT TAKES A LITTLE WHILE TO GET THE REPORT WRITTEN AND, AND EVERYTHING ISSUED. SO THAT'S KIND OF THE TIMING. UM, WE HAVE AN ENGAGEMENT LETTER THAT'S DATED IN OCTOBER. UM, SO OUR RESPONSIBILITY IS, UH, UNDER PROFESSIONAL STANDARDS IS TO FORM AND EXPRESS AN OPINION ON THE FINANCIAL STATEMENTS, UM, THAT THEY ARE FREE OF ANY MATERIAL MISSTATEMENTS. UM, IT DOESN'T RELIEVE MANAGEMENT IF THEIR RESPONSIBILITIES MANAGEMENT HELPS PUT THE, THE RESPONSE HELPS PUT THE FINANCIAL STATEMENTS TOGETHER, OF COURSE, WITH OVERSIGHT OF THE BOARD. THAT SECOND PARAGRAPH UNDER OUR RESPONSIBILITY, UM, JUST TALKS ABOUT HOW WE PLAN AND PERFORM THE AUDIT TO OBTAIN A REASONABLE ASSURANCE, BUT NOT ABSOLUTE. SO OBVIOUSLY WE CAN'T LOOK AT EVERY SINGLE TRANSACTION, UM, THAT GOES THROUGH THE YEAR. UM, FOR THE, FOR B-C-R-U-A, WE DO HAVE A MATERIALITY THRESHOLD. WE LOOK AT KIND OF WHAT'S MATERIAL AND WHAT WE THINK THE READERS WOULD REALLY, UM, SUBSTANTIALLY CARE ABOUT, RIGHT? IN TERMS OF DOLLAR AMOUNT AND ACTIVITY. UM, WHILE WE DON'T PROVIDE AN OPINION ON INTERNAL CONTROL, WE DO LOOK AT INTERNAL CONTROL. SO OF COURSE I'M TALKING ABOUT THE FINANCIAL STATEMENTS, INTERNAL CONTROL, SO HOW, UM, FOR INSTANCE, HOW, UM, REVENUE GETS RECORDED, HOW EXPENSES GO OUT THE DOOR, UM, THINGS LIKE THAT. HOW FINANCIAL STATEMENTS GET CLOSED EVERY MONTH AND THINGS LIKE THAT. SO WE WANNA MAKE SURE THAT THERE'S APPROPRIATE SEGREGATION OF DUTIES THAT, UM, MAN MANAGEMENT, APPROVALS, AUTHORIZATION, THINGS LIKE THAT. SO WHILE WE DON'T PROVIDE AN OPINION ON INTERNAL CONTROLS, IF WE WERE TO FIND SOMETHING DURING THAT PROCESS, LIKE MAYBE WE DID THINK THERE WAS APPROPRIATE SEGREGATION OF DUTIES OR MANAGEMENT AUTHORIZATIONS, WE WOULD COME TO THE BOARD AND TELL YOU GUYS. SO WE DIDN'T FIND ANYTHING LIKE THAT. WE'RE RESPONSIBLE FOR COMMUNICATING ANY OTHER SIGNIFICANT MATTERS. SO NONE THERE. THE PLAN, SCOPE AND TIMING OF THE AUDIT, I TOUCHED ON THAT. WE DO MOST OF OUR WORK IN OCT IN, UM, LATE NOVEMBER, EARLY DECEMBER, AND THEN ISSUE IN JANUARY. IN TERMS OF ETHICAL REQUIREMENTS REGARDING INDEPENDENCE AS YOUR INDEPENDENT AUDITOR, [00:40:01] WE ARE REQUIRED TO HAVE, UM, NO AFFILIATIONS WITH B-C-R-U-A. UM, SO WE DO GO THROUGH THAT KIND OF INTERNAL CHECKS AND BALANCES EVERY YEAR. JUST MAKE SURE THAT THERE'S NO ONE ON THE TEAM THAT HAS ANY AFFILIATIONS WITH MEMBERS OF MANAGEMENT OR THE BOARD. THE TOP OF PAGE TWO, IT TALKS ABOUT SIGNIFICANT RISKS IDENTIFIED. PART OF OUR DUE DILIGENCE ON THE AUDIT PROCESS IS ALWAYS TO LOOK AT WHERE YOUR SIGNIFICANT RISKS ARE IN YOUR FINANCIAL STATEMENTS THEMSELVES. SO NOT NECESSARILY OPERATIONALLY, BUT FINANCIAL STATEMENT WISE. AND SO, UM, IF WHEN YOU SAY, I KNOW SOMETIMES WHEN YOU SEE SIGNIFICANT RISK, IT RAISES A RED FLAG. IT SIMPLY MEANS THAT WE DID OUR DUE DILIGENCE. UM, AND PART OF THE, UM, THE PROCESS IS REALLY IDENTIFYING, OKAY, WHERE COULD THE FINANCIAL STATEMENTS BE MISLEADING? UM, AND WHAT ARE SOME OF THE COMMON SIGNIFICANT RISKS IN FINANCIAL STATEMENTS? SO WE ALWAYS LOOK AT REVENUE RECOGNITION, UM, JUST BECAUSE THERE IS A LOT OF LATITUDE SOMETIMES WHEN YOU CAN RECOGNIZE REVENUE FOR B-C-R-U-A, IT'S PRETTY STRAIGHTFORWARD BECAUSE MOST OF YOUR REVENUE COMES FROM THE CITIES AND IT'S BASED ON BUDGETED EXPENDITURES. SO WE ALWAYS LOOK AT THAT, BUT WE WANNA MAKE SURE THAT THERE'S PROPER CUTOFF AND THAT YOUR REVENUE FOR THE YEAR IS APPROPRIATE FOR THOSE 12 MONTHS. SO WE LOOK AT THAT. UM, WE ALSO LOOK AT WHAT WE CALL MANAGEMENT OVERRIDE OF CONTROLS. SO WHILE THERE COULD BE GOOD CONTROLS THROUGHOUT THE YEAR, IF YOU HAVE, YOU KNOW, MANAGEMENT IN TERMS OF CLOSING THE BOOKS, IF THERE'S ANY, UM, OVERRIDE OF CONTROLS, MEANING SOMEONE COMES IN AND BOOKS A JOURNAL ENTRY, UH, FOR AN ESTIMATE OR SOMETHING LIKE THAT. SO WE ALWAYS LOOK AT THOSE KIND OF YEAR END ENTRIES, MAKE SURE THAT THERE'S NO OVER WHAT WE WOULD CALL OVERRIDE OF CONTROLS IN THERE. SO WE DIDN'T FIND ANYTHING LIKE THAT. BUT THAT'S JUST TO SAY THOSE ARE KIND OF SOME OF THE KEY AREAS WE LOOK AT IN TERMS OF SIGNIFICANT RISKS. AS FAR AS QUALITATIVE ASPECTS OF THE ACCOUNTING POLICIES, UM, THAT'S TALKED ABOUT IN NOTE TWO TO THE FINANCIAL STATEMENTS. UM, THERE WAS ACTUALLY NO INITIAL, UM, APPLICATION OF ANY NEW ACCOUNTING POLICIES THIS YEAR FOR B-C-R-U-A. NOTHING THAT WAS APPLICABLE. SO YOUR FINANCIAL STATEMENTS AND, AND NOTES LOOK PRETTY SIMILAR TO LAST YEAR IN TERMS OF SIGNIFICANT ACCOUNTING ESTIMATES. EVERY FINANCIAL STATEMENTS USUALLY HAVE SOME TYPE OF ESTIMATES. SO REALLY FOR BCR UUA, WE LOOK AT, UM, THE DEPRECIABLE LIVES OF YOUR FIXED ASSETS AS ONE OF THE THINGS BECAUSE YOU DO HAVE SUCH A LARGE DOLLAR VALUE OF ASSETS. AND ONCE THOSE ASSETS GET OUT OF, UM, CIP OR WIP AND GO INTO AN ACTUAL, UM, PROJECT THAT'S BEING USED FOR ITS INTENDED PURPOSE, IT STARTS THE DEPRECIATION PROCESS IN TERMS OF FINANCIAL REPORTING, RIGHT? AND SO IN ORDER TO DETERMINE WHAT, HOW FAST THAT ASSET DEPRECIATES, YOU HAVE TO GIVE IT A USEFUL LIFE, WHICH IS AN ESTIMATE. AND SO WE WANNA MAKE SURE THAT ANY, ANY TIME YOU'RE ASSIGNING AN AN ESTIMATED USEFUL LIFE, THAT IT'S APPROPRIATE JUST BASED ON THE ASSET ITSELF, BASED ON, UM, HISTORICALLY WHAT OTHER ENTITIES ARE DOING. AND JUST THAT, YOU KNOW, BASED ON HISTORICAL KNOWLEDGE. AND SO WE LOOK AT THAT EVERY YEAR. WE DIDN'T FIND ANYTHING UNUSUAL IN TERMS OF, UM, USEFUL LIFE OF THE ASSETS. AND THEN ONE OF THE OTHER ESTIMATES WE LOOK AT IS JUST THE REVENUE TRUE UPS. EVERY YEAR. THERE'S, WE GO THROUGH THE PART OF THE FINANCIAL STATEMENT CLOSES JUST TO MAKE SURE THAT THE REVENUES BETWEEN THE CITIES ARE TRUED UP, UM, BECAUSE THE, THE STATEMENTS IN THE BACK EACH CITY USES TO REPORT IN THEIR OWN AFR. AND SO THEY WANNA MAKE SURE THAT THEIR CONTRIBUTIONS ARE CORRECTLY, UH, PRESENTED. AND SO THERE'S A LOT OF TRUE UP BACK AND FORTH THERE. AND SOME OF THOSE ARE ESTIMATES JUST BASED ON EXPENDITURES AND THINGS LIKE THAT. SO WE ALWAYS MAKE SURE THAT THOSE ESTIMATES, UM, ARE CORRECT. SO AGAIN, ESTIMATES IN THE FINANCIAL STATEMENTS, WE DIDN'T FIND ANYTHING UNUSUAL. THOSE, AND WE, WE DETERMINED THEM TO BE REASONABLE. SO THE NEXT, THE NEXT PART JUST TALKS ABOUT ANY SIGNIFICANT UNUSUAL TRANSACTIONS. TYPICALLY, IF THERE WERE THOSE, WE WOULD'VE BROUGHT THOSE TO YOU AHEAD OF TIME. WE DIDN'T HAVE ANYTHING LIKE THAT, NOR DID WE FIND ANY SUSPECTED OR IDENTIFIED FRAUD, NO DIFFICULTIES ENCOUNTERED DURING THE AUDIT ITSELF OR WITH MANAGEMENT. SO THAT'S ALWAYS NICE. UM, IN TERMS OF UNCORRECTED AND CORRECTED MISSTATEMENTS, THERE IS A SCHEDULE IN THE BACK THAT HAS A COUPLE OF JOURNAL ENTRIES THAT WERE BOOKED. REALLY, THE MAIN TAKEAWAY THERE IS WHEN WE DID COME IN TO DO THE AUDIT, THE BOOKS WERE, UM, SUBSTANTIALLY COMPLETE. WE DIDN'T HAVE ANY SIGNIFICANT JOURNAL ENTRIES THAT WE FOUND THAT THAT MANAGEMENT MISSED. THERE ALWAYS ARE SOME, UM, LIKE I SAID, TRUE UP ENTRIES OR THINGS THAT JUST TO CLEAN UP THE BOOKS A LITTLE BIT, BUT NOTHING THAT INDICATED THAT MANAGEMENT WASN'T APPROPRIATELY BOOKING, UM, YOU KNOW, ENTRIES THE WAY THEY NEEDED TO. SO NOTHING LIKE THAT. SO YOUR INDEPENDENT AUDITORS REPORT LOOKS PRETTY STANDARD. THERE WERE NO OTHER CIRCUMSTANCES THAT AFFECTED THAT REPORT. WE DO THAT REPRESENTATIONS REQUESTED FROM MANAGEMENT. WE DO ASK MANAGEMENT TO SIGN WHAT WE CALL A MANAGEMENT REPRESENTATION LETTER EVERY YEAR. THAT'S BASICALLY JUST MANAGEMENT TAKING RESPONSIBILITY FOR THE FINANCIAL STATEMENTS THEMSELVES. UM, THEM TELLING US THAT THEY DID PROVIDE US, UM, TRUE AND HONEST ANSWERS. THEY DIDN'T WITHHOLD INFORMATION, THINGS LIKE THAT. THE [00:45:01] TOP OF PAGE FOUR, NO MANAGEMENT CONSULTATIONS WITH OTHER ACCOUNTANTS, NO OTHER SIGNIFICANT MATTERS OR FINDINGS OR ISSUES. UM, IN TERMS OF MODIFICATION TO THE AUDITOR'S REPORT, WE ALWAYS HAVE WHAT WE CALL AN EMPHASIS OF MATTER PARAGRAPH IN THE AUDIT ITSELF, WHICH BASICALLY JUST TELLS THE READER, HEY, THESE FINANCIALS THEMSELVES ARE HEAVILY DEPENDENT ON THE THREE CITIES, RIGHT? BECAUSE THAT'S WHERE YOU GET YOUR, YOUR CONTRIBUTIONS. SO I THINK ANYBODY LOOKING IN THE FINANCIAL STATEMENTS COULD PROBABLY GATHER THAT, BUT WE PUT THAT UP FRONT AND SAY, HEY, YOU KNOW, THERE IS, UM, FINANCIAL DEPENDENCE ON THESE CITY OF LEANDER, CEDAR PARK AND ROUND ROCK. AND THEN THESE ARE JUST SOME OF THE ENTRIES THAT WE BOOKED AT YEAR END. THERE WAS, UM, YOU KNOW, ONE OF THE THINGS WE, I SAY WE STRUGGLE WITH, NOT REALLY STRUGGLE WITH, BUT YOU KNOW, ON THE FINANCIAL STATEMENT SIDE, UM, AND THIS IS WITHIN ANY, SOMETIMES THE FINANCIAL STATEMENT SIDE IS A LITTLE DISCONNECTED FROM OPERATIONS, RIGHT? AND SO WHEN YOU HAVE BIG ASSETS THAT ARE BEING CONSTRUCTED, ONE OF THE KEY, UM, COMPONENTS IS MAKING SURE THAT WHEN THOSE ASSETS ACTUALLY GET OPERATIONAL, THAT THEY MOVE FROM CIP TO FIXED ASSETS. AND SO WE DID HAVE JUST A RECLASS OF SOMETHING THAT WAS ACTUALLY PUT INTO, PUT INTO USE AT YEAR END, AND SO NEEDED TO BE MOVED OUT OF CIP INTO INFRASTRUCTURE. AND THAT'S IMPORTANT AGAIN BECAUSE YOU START DEPRECIATING THAT ASSET WHEN IT'S BEING USED. AND THEN A RECLASSIFYING JOURNAL ENTRY JUST FOR REPORTING PURPOSES. SO MOVING, UM, PAYABLES OUT OF TRADES PAYABLE, WHICH IS USUALLY A THIRD PARTY PAYABLE INTO A PAYABLE THAT'S DUE TO A PARTICIPANT BECAUSE WE SEPARATELY IDENTIFY ANYTHING THAT'S DUE TO THE SISTER CITY SINCE THEY'RE ACTUALLY PARTICIPANTS IN THE B-C-R-U-A. AND THAT LAST ENTRY WAS JUST THE DEPRECIATION THAT HAD TO DO WITH THE ASSET THAT MOVED OUT OF CIP TO, UM, FACILITIES. SO I KNOW THAT NUMBER LOOKS BIG, BUT TO BE HONEST, IT'S NOT MATERIAL TO THE FINANCIAL STATEMENTS, UM, IN TERMS OF DEPRECIABLE BALANCE. SO THAT'S REALLY MY REQUIRED COMMUNICATION. I HOPE I DIDN'T GO TOO QUICKLY, UM, BUT I WILL JUST TOUCH BRIEFLY ON THE AUDIT REPORT ITSELF. . SO THE FINANCIAL REPORT, IT'S GONNA BE KIND OF HARD TO TO SCROLL, BUT I'LL JUST GO THROUGH IT IN. UM, IN TERMS OF THE FINANCIAL REPORT, IT'S SET UP VERY SIMILAR TO LAST YEAR. SO IF YOU LOOKED AT IT, THE FINANCIAL STATEMENTS, THE TABLE OF CONTENTS LOOK VERY SIMILAR. UM, WE PRESENT B-C-R-U-A AS A WHOLE, AND THEN IN THE BACK THERE'S SUPPLEMENTAL SCHEDULES THAT, THAT ARE FOR EACH CITY. UM, LIKE I SAID, THERE'S A CLEAN OPINION IN THE FRONT. THERE'S ALSO AN OPINION IN THE BACK, UM, THAT'S A GOVERNMENT, WHAT WE CALL GIST OPINION, BECAUSE, UM, YOU HAVE, UM, OR SORRY, THERE ISN'T A GIST OPINION, UM, OR THERE IS IN THE BACK. SO THOSE, BUT THAT IS, IS, THAT'S A REPORT OVER, UM, COMPLIANCE AND OTHER MATTERS BASED ON FINANCIAL STATEMENTS UNDER GOVERNMENT AUDITING STANDARDS. SO BECAUSE YOU ARE A GOVERNMENT ENTITY, YOU HAVE THAT SEPARATE REPORT AND IT'S JUST AN ADDITIONAL LAYER OF WHAT WE DO DURING THE AUDIT. I TALKED ABOUT LOOKING AT CONTROLS, AND SO THAT'S PART OF, UM, THAT AUDIT WHERE YOU GET SCRUTINIZED JUST A LITTLE BIT MORE BECAUSE YOU ARE A GOVERNMENT ENTITY. UM, I WILL POINT OUT IN THE AUDIT, IN THE, UM, FINANCIAL STATEMENTS THEMSELVES, THE FINANCIAL STATEMENTS ARE A SINGLE YEAR PRESENTATION. BUT I DO ALWAYS LIKE TO POINT OUT, IF YOU LOOK AT M-D-N-A-M-D-A GIVES A GOOD, UM, KIND OF PICTURE OF YEAR OVER YEAR OR BUDGET TO ACTUAL. UM, SO IF YOU LOOK AT THE MANAGEMENT DISCUSSION AND ANALYSIS, WHILE THAT SECTION OF THE PORT OF THE REPORT TECHNICALLY IS AN AUDITED, WE DO LOOK AT THAT. WE GIVE THAT TO MANAGEMENT TO FILL OUT IN TERMS OF THE STORY THAT THEY WANT TO TELL, BUT WE LOOK AT IT AND MAKE SURE THAT THE NUMBERS COINCIDE WITH THE AUDITED NUMBERS THAT ARE IN THE, IN THE FINANCIAL STATEMENTS. UM, BUT THAT GOES OVER PHASE BY PHASE, WHAT HAPPENED DURING THE YEAR. UM, IT GIVES THE NUMBERS PRIOR YEAR TO CURRENT YEAR. SO YOU CAN SEE HOW YOUR NET POSITION INCREASED, DECREASED, HOW YOUR DEBT INCREASED, DECREASED. UM, SO AGAIN, THAT'S, AS, THAT'S COMPARING 9 30, 20 22 TO 9 30, 20 23. UM, ANY QUESTIONS ON THAT OR ANYTHING YOU'D LIKE ME TO SHOW YOU IN PARTICULAR ON THE AUDIT REPORT? DR. FLORES? I DON'T KNOW IF IT WAS IN THE AUDIT REPORT, BUT JUST A QUESTION. ARE YOU GUYS ENGAGED? ARE Y'ALL DOING THE 24 REPORT FOR US, THE 24 AUDIT FOR US? OR IS THAT SOMEBODY ELSE, OR, I BELIEVE WE'RE ENGAGED. UM, I THINK OUR CONTRACT, I LOOKED TO ERIC, I THINK IT'S MAYBE FOR TWO OR THREE YEARS. OKAY. SO I THINK, I THINK WE ARE WELL, UH, SO I WAS JUST KIND OF CURIOUS QUESTION, BUT GIVEN THE FACT THAT WE HAD A, UM, SWITCH IN GMS, LIKE FOR THE 24 REPORT, WHOEVER DOES THE REPORT FOR 24, IS THERE KIND OF A STATEMENT OF FACT IN, IN THE REPORT THAT, YOU KNOW, GM LEFT THIS STATE AND NEW GM STARTED AT THIS STATE TO KIND OF PROTECT BOTH OF 'EM AND KIND OF GIVE 'EM A CLEAN BILL OF HEALTH THAT UP TO THIS POINT EVERYTHING WAS GOOD [00:50:01] AND THEN FROM THIS POINT IT WAS A NEW LEADERSHIP. SO WE DON'T DO ANYTHING IN PARTICULAR FOR THE AUDIT REPORT FOR THAT. NOW I DO SAY WHEN WE ARE IN THE THICK OF THE AUDIT, I MEAN, SAM WAS IN TRANSITION, UM, AND SO, YOU KNOW, WE TALKED TO BOTH HIS PREDECESSOR AND HIM DURING THE AUDIT JUST TO MAKE SURE THAT, UM, WE UNDERSTOOD WHAT THAT TRANSITION LOOKED LIKE, WHY THE REASON FOR THE LEAVE OF COURSE WAS, YOU KNOW, NORMAL RETIREMENT. UM, SO IT IS PART OF OUR, WHAT I WOULD CALL RISK ASSESSMENT. ANYTIME YOU, YOU HAVE A KEY MANAGEMENT, UM, PERSONNEL LEAVING, WE WANNA KNOW, HEY, WHAT'S GOING ON? UM, HOW, WHAT WAS THE VETTING PROCESS? WE ALWAYS TALK TO THE OLD, THE, YOU KNOW, PREVIOUS PERSON AND THE NEW PERSON IN THE POSITION. BUT IN TERMS OF THAT BEING IN THE FINANCIAL STATEMENTS, IT'S REALLY NOT, NOT THERE. YEAH. 'CAUSE A LOT OF TIMES THOSE HAPPEN, YOU KNOW, THIS IS AS OF 2023, SO A LOT OF TIMES THOSE SWITCHES HAPPEN MIDYEAR AND THINGS LIKE THAT. RIGHT. UM, UM, BUT IT IS DEFINITELY SOMETHING WE CONSIDER. WE'VE HAD, WE'VE HAD, YOU KNOW, WHEN YOU HAVE, ESPECIALLY WHEN YOU HAVE FINANCIAL, UH, KEY FINANCIAL PEOPLE LEAVE IN THE MIDDLE OF THE YEAR OR DURING THE AUDIT, IT CAN CAUSE UH, YOU KNOW, SOME HICCUPS. SO, , THANK YOU. YEAH, GO AHEAD. I WAS JUST GONNA ASK MR. ROBERTS, IF YOU COULD, ON THIS, UM, MANAGEMENT DISCUSSION UNDER SEPTEMBER, CAN YOU JUST CONFIRM THAT THIS NUMBER IS RIGHT? I DON'T KNOW WHY IT'S THROWING ME OFF UNDER THE PHASE TWO A, UM, WHAT PAGE ARE YOU ON? IT'S 12. I DON'T KNOW IF WE WERE, THIS WAS JUST THE ESTIMATE OR WE HAVE TO BE EXACTLY ACCURATE. SO THAT'S WHAT I WAS ASKING AT THE BOTTOM OF TWO A WHERE IT SAYS THE 67 MGD, I JUST WANT TO CONFIRM AGAIN THAT THAT WAS THE RIGHT NUMBER. IT'S ON 12 AT THE BOTTOM. SO YOUR QUESTION IS, YOUR QUESTION IS, IS THE, UH, OH, IS THE, IS IT 67 OR MGD? YES. OR IS IT, I THINK IT'S 64.2 IS WHAT YOU HAD. I I WASN'T SURE IF IT HAD TO I WAS GONNA SAY 65, BUT THAT'S A GOOD, THAT'S A GOOD POINT, NICOLE. OKAY. I JUST WANTED TO MAKE SURE THAT I WASN'T MISSING SOMETHING. NO, THIS IS, THAT'S FINE. YEAH. YEAH, THAT'S FINE. OKAY. I MEAN, YEAH, AS I SAID, THE, THE MDA REALLY COMES FROM MANAGEMENT AND I KNOW SOMETIMES THAT INFORMATION IS, IS CHANGING, IS CHANGING. YES. UM, SO, YOU KNOW, WE, WHILE WE DO LIKE TO PROVIDE IT, SOMETIMES THERE'S NOT A DIRECT LINK BETWEEN THE FINANCIALS, BUT IT'S, IT'S GOOD INFORMATION TO HAVE. OKAY. SO THAT'S A GOOD POINT. THANK YOU. THANK YOU. GOOD QUESTION. ANY OTHER QUESTIONS? THE, THE AUDIT ADJUSTMENTS THAT YOU SPOKE TO MM-HMM. KIND OF JUST CLEANING UP AND TRUING UP. I DIDN'T SEE THAT IN OUR COPY, BUT THAT, THAT WAS, YOU SAID THAT WAS NOT, NOT MATERIAL. THAT WAS JUST YEAH, THERE'S, THERE ARE TYPICALLY ALWAYS SOME ADJUSTMENTS THAT COME, YOU KNOW, WE, WE COME IN AND, AND WE HAVE TO, YOU KNOW, THE, THE MANAGEMENT USUALLY HAS TO HAVE THE BOOKS EITHER CLOSED OR NEAR CLOSED. AND SO, UM, BUT USUALLY THERE ARE ADJUSTMENTS THAT HAPPEN. UM, REALLY, YOU KNOW, FOR INSTANCE, YOU KNOW, WHEN YOU START DIGGING IN, YOU MAY THINK THE FINANCIAL STATEMENTS ARE CLOSED, AND THEN IF YOU DIG IN A LITTLE BIT MORE, YOU SEE, WE SAW, YOU KNOW, ONE PROJECT THAT DIDN'T HAVE A LOT OF ACTIVITY THAT, THAT TECHNICALLY WAS IN, IN OPERATION DURING THE YEAR. SO MOVED IT FROM CIP TO FIXED ASSETS. UM, AGAIN, WE DON'T, IF IT WAS A HUGE, HUGE DOLLAR AMOUNT, THAT MIGHT'VE BEEN SOMETHING THAT WOULD'VE BEEN A RED FLAG. BUT, UM, I THINK MANAGEMENT, WE DIDN'T FIND ANYTHING WHERE MANAGEMENT WASN'T DOING THEIR DUE DILIGENCE. ANYTIME YOU'RE GONNA HAVE AUDITORS COME IN AND SCRUTINIZE A LITTLE BIT MORE, YOU KNOW, YOU'RE LIKELY TO FIND SOMETHING. UM, BUT OUR JOB IS IF WE FIND SOMETHING REALLY MATERIAL THAT INDICATES THAT MAYBE MANAGEMENT WASN'T DOING THEIR JOB, WE WOULD BRING THAT TO YOU GUYS. UM, BUT WE DO LIKE TO PRESENT THE, THE ADJUSTMENTS THEMSELVES ANYWAY, JUST SO YOU, YOU HAVE 'EM AND, AND KNOW, AND, AND I'M SORRY, JUST A FOLLOW UP QUESTION ON THAT. WHEN YOU, YOU'VE MADE THAT COMMENT A COUPLE TIMES THAT YOU WOULD BRING IT TO OUR ATTENTION THAT THERE WAS A CONCERN OR THERE WAS SOMETHING GOING ON, WOULD THAT BE IN THIS FORUM OR WOULD, WOULD THAT BE PRESENTED TO THE GENERAL MANAGER, HEY, WE NEED TO TALK ABOUT THIS? OR HOW WOULD WE KNOW AS A BOARD KNOW THAT? YEAH, IT DEPENDS ON, IT DEPENDS ON WHAT IT IS. USUALLY WHEN WE FIND SOMETHING DURING THE AUDIT, UM, WE USUALLY ASK MANAGEMENT, IS THERE SOMEONE AT THE BOARD THAT YOU WANT TO BE, YOU KNOW, IS THAT, IS THE SPOKESPERSON? SO WE MIGHT START WITH SAM IN TERMS OF THE GENERAL MANAGER. UM, BUT IF IT'S MORE OF A FINANCIAL MATTER WHERE WE'RE GONNA REPORT SOME TYPE OF DEFICIENCY OR SOME TYPE OF FRAUD, THEN USUALLY, YOU KNOW, I WOULD GO TO THE PRESIDENT OF THE BOARD OR THE DIRECTOR AND SAY, HEY. AND SO USUALLY WE'D REQUEST A CALL BEFORE THE PRESENTATION, JUST SO YOU KNOW, THERE WOULD BE NO SURPRISES. OKAY. THANK YOU. THANK YOU FOR THAT. YEAH. ANYTHING ELSE? ALRIGHT. THANK YOU. THANK YOU GUYS. I DO WANT TO, TO THANK YOU KNOW CEDAR PARK FINANCIAL TEAM. I KNOW IT'S, IT'S ALWAYS, UM, A JOB ON TOP OF YOUR NORMAL JOB TO HANDLE THE AUDIT. SO, UM, YOU KNOW, ERICA AND KEVIN AND THEIR FINANCIAL MANAGEMENT TEAM DID A GREAT JOB OF GETTING US EVERYTHING WE NEEDED, UM, AND REVIEWING THE REPORT AND, AND FINISHING EVERYTHING. SO WANTED TO, TO GIVE KUDOS TO THEM. YEAH. THANK YOU. THANK YOU FOR BEING HERE. ALRIGHT, I'LL ENTERTAIN A MOTION, UH, TO ADOPT THE 2022 2023 FINANCIAL AUDIT. SO MOVED. SECOND. HAVE [00:55:01] A MOTION BY A SECRETARY DUFFY, A SECOND BY VICE PRESIDENT THOMPSON. ALL IN FAVOR SAY AYE. AYE. MOTION PASSES. THESE IS, UH, NUMBER SEVEN, RESOLUTIONS. CONSIDER RESOLUTION ACCEPTING THE B-C-R-U-A QUARTERLY INVESTMENT REPORT FOR OCTOBER 1ST, 2023 THROUGH DECEMBER 31ST, 2023. THANK YOU, MR. PRESIDENT, MEMBERS OF THE BOARD. FIRST, LEMME SAY THAT I HATE FOLLOWING GOOD PRESENTATIONS, AND YOU'VE HAD THREE SO FAR, SO, UM, MAKE IT FOUR. HERE WE GO. BELIEVE IN YOU. WE BELIEVE IN YOU. UH, THIS IS THE, UH, QUARTERLY INVESTMENT REPORT AS, AS MENTIONED FOR THE, UH, PERIOD OCTOBER THROUGH DECEMBER, 2023. UH, THE, UM, BEGINNING BOOK VALUE IN OCTOBER WAS 125 MILLION, AND THE ENDING BOOK VALUE OF CASH AND INVESTMENTS WAS 150 MILLION AT THE END OF, UH, DECEMBER. INVESTMENT EARNINGS DURING THE QUARTER WERE $1.6 MILLION, AND THE AVERAGE YIELD, UH, TO MATURITY FOR ALL THE INVESTMENTS WAS, UH, JUST UNDER 4.8%. UM, THE WEIGHTED AVERAGE MATURITY OF THE INVESTMENTS, UM, THE WHAM, UH, DECREASED FROM 67 DAYS TO 45 OR 44 DAYS. UH, THAT'S INDICATIVE OF, UM, INVESTMENTS THAT, UH, WERE PLACED, UH, IN THE, IN THE PAST YEAR TO TWO YEARS THAT HAVE COME, UM, HAVE MATURED AND, UM, UH, EITHER HAVE, UM, REMAINED AT TECHSTAR, WHICH IS OVERNIGHT INVESTMENTS OR THEY'VE BEEN REINVESTED IN SHORT TERM MATURITIES. UM, IN TERMS OF, UH, LOOKING, UM, FORWARD IN THE, THE NEXT SEVERAL MONTHS, UH, CEDAR PARK, UH, FUNDS ARE, ARE STAYING FAIRLY, UM, STAGGERED IN TERMS OF, UH, UH, INVESTING OUT A LITTLE BIT LONGER THAN, UM, UH, OR TRYING TO MATCH THE CONSTRUCTION, UH, SCHEDULE. LEANDER IS KEEPING THE REMAINING REMAINDER OF ITS FUNDS, UH, LIQUID THROUGH THE END OF THIS YEAR. UH, AND THEN IN NOVEMBER OF, OF THIS YEAR, UH, LEANDER WILL TAKE OUT THE THIRD AND FINAL TRANCHE OF, OF OUR WATER DEVELOPMENT BOARD LOAN ROUND ROCK'S FUNDS THAT WERE, UH, DRAWN DOWN IN, UH, NOVEMBER OF 2023, ALONG WITH SOME ADDITIONAL FUNDS BY CEDAR PARK. UH, THOSE REMAIN IN ESCROW PENDING, UH, THE PAPERWORK NECESSARY TO, UH, WORK THROUGH THE WATER DEVELOPMENT BOARD STAFF TO GET THOSE FUNDS RELEASED INTO, UH, CONSTRUCTION ACCOUNTS. AND THEN, UH, I BELIEVE THE INTENT IS FOR A MAJORITY OF ROUND ROCK'S FUNDS TO BE, UH, PAID BACK TO ROUND ROCK FOR, UH, PREVIOUS CASH FUNDED, UM, UH, UH, ROUND ROCK, UP TO THIS POINT HAD BEEN CASH FUNDING, UH, THIS PROJECT. SO, UH, THAT IS SHORT AND SIMPLE. UH, HOPEFULLY, UM, HAPPY TO ANSWER ANY QUESTIONS. ALRIGHT, ANY QUESTIONS ON THIS ITEM? YEAH. ALRIGHT. ENTERTAIN A MOTION TO APPROVE ITEM SEVEN A MOTION TO APPROVE. AND NOW SECOND MOTION BY VICE PRESIDENT THOMPSON. SECOND BY SECRETARY DUFFY. ALL IN FAVOR SAY AYE. AYE. AYE. THANK RESOLUTION PASSES. IT LEAVES US TO SEVEN B. THANK YOU. UH, SEVEN B CONSIDER RESOLUTION AUTHORIZING THE PRESIDENT TO EXECUTE SUPPLEMENTAL CONTRACT NUMBER THREE WITH WALKER PARTNERS FOR ENGINEERING SERVICES FOR THE DELIVERY POINT AND RAW WATER VALVE IMPROVEMENT PROJECT. THIS, UH, THIS ITEM, SUPPLEMENTAL CONTRACT NUMBER THREE, UH, IS FOR ADDITIONAL SERVICES TO PROVIDE GENERAL ADMINISTRATION CONSTRUCTION CONTRACTS THAT OTHERWISE WE, WE, WE REFER TO IT AS CONSTRUCTION PHASE SERVICES, WHICH IS NOT CURRENTLY INCLUDED IN ANY OF THE ENGINEERING CONTRACTS THAT WE HAVE PREVIOUSLY EXECUTED. THE, THE, UH, , THE, IF YOU LOOK IN THE, UH, IN THE CONTRACT THAT'S THE SERVICES ARE DESCRIBED. I'M SORRY, I KEEP FORGETTING TO TURN THAT ON. THE SERVICES ARE DESCRIBED IN DETAIL IN, IN THE, YOUR, THE ATTACHED CONTRACT IN YOUR PACKET. AND THEY'RE, THEY'RE QUITE ROBUST, BUT THEY'RE KIND OF HIGH LEVEL AS THEY, THEY INCLUDE A RESIDENT PROJECT REPRESENTATIVE, RPR, UH, TO INSPECT AND ENSURE, TO INSPECT AND ASSURE THAT THE PROJECTS ARE BUILT ACCORDING TO THE PLANS AND SPECIFICATIONS THAT WERE DESIGNED AND APPROVED. AND IT IS A REALLY IMPORTANT PART OF THE, UH, PROJECT. 'CAUSE IT, [01:00:01] YOU COULD HAVE THE BEST DESIGN PROJECT IN THE WORLD, BUT IF IT'S NOT INSTALLED PROPERLY, UH, THAT'S NO GOOD. AND, AND IT, IT ALSO INCLUDES A LOT OF, I CALL 'EM ENGINEERING SERVICES. UH, THERE, THERE'S A, UH, THE ENGINEER THAT DESIGNED THE INSTRUMENTATION AND CONTROLS WITH INC FOR THAT PROJECT, WHICH THERE'S A LOT OF, BECAUSE IT'S, IT'S A BUNCH OF ELECTRICAL STUFF. UH, HE, UH, IS GOING TO BE OUT ON THE JOB A LOT, UM, INSPECTING AND MAKING SURE THAT EVERYTHING IS INSTALLED PROPERLY. AND, AND THEN LASTLY, UH, COMMISSIONING, COMM COMMISSIONING OF THE, OF THIS PROJECT IS, I, I KNOW Y'ALL, I THINK Y'ALL TALKED A LOT ABOUT THIS PROJECT A LOT IN THE, IN THE LAST YEAR SINCE WHEN I WASN'T HERE. I HEARD THAT THERE, YOU KNOW, THERE WERE SEVERAL ITEMS WHEN Y'ALL GETTING TO THE POINT OF APPROVING THE PROJECT, THE, THE CONCEPT AND NOW THE, WE GET TO SEE IF IT'S GONNA WORK. 'CAUSE YOU KNOW, WE HAVE, THERE'S, THERE'S SEVEN DELIVERY POINTS, UH, VALVES AND, YOU KNOW, EACH DELIVERY POINT IS A VALVE AND IT'S GOT A CONTROL ON IT. AND IT'S GOT ALL THESE, YOU KNOW, IT'S GOT IT'S CONTROLLED ELECTRONICALLY AND THEN BY SCADA AND BY ALL THIS STUFF THAT WE'RE INSTALLING. SO THE COMMISSIONING OF THAT IS REALLY IMPORTANT TO MAKE SURE IT, IT'S, IT WORKS, RIGHT. AND BECAUSE ALL IT, IT ALL GETS CONTROLLED AT THE WATER TREATMENT PLANT IN THE SCADA CONTROL ROOM, THE SUPERVISOR CONTROL AND DATA ACQUISITION, THE ROOM WITH ALL THE SCREENS ALL OVER THE WALLS. AND SO ANYHOW, UH, WE'RE, I, I WAS VERY HAPPY TO SEE THAT WE BROUGHT A REALLY THOROUGH, UH, CONSTRUCTION PHASE, UH, SERVICES FOR THIS CONTRACT. 'CAUSE WE REALLY NEED IT. AND, UM, AND THAT'S WHAT THIS IS. UM, OTHER THAN THAT, I'D, I'D BE HAPPY TO ANSWER ANY QUESTIONS. THE, UH, THE RESOLUTIONS ARE IN THE PACKET AS PREPARED BY, UM, SHEETS AND CROSSFIELD. AND, AND THE OC HAS HAS, YOU KNOW, THEY'VE BEEN, THEY REVIEWED THE CONTRACT. WE ACTUALLY KIND OF WELDED IT DOWN A LITTLE BIT AND, UH, TO TRY TO, TRY TO BE A LITTLE, UH, TO BE EFFICIENT WITH IT. AND WITH THAT I WOULD, I WOULD, UH, OPEN IT UP TO ANY QUESTIONS. ALRIGHT. ANY QUESTIONS FOR SAM? ALL RIGHT. SEEING NONE, I'LL ENTERTAIN A MOTION TO APPROVE RESOLUTION. ITEM SEVEN BI MOVE TO APPROVE. SECOND. MOTION APPROVE BY SECRETARY DUFFY, SECOND BY VICE PRESIDENT THOMPSON. ALL IN FAVOR SAY AYE. AYE. AYE. RESOLUTION PASSES. THANK YOU, SAM. ALL RIGHT, THAT BRINGS ITEM NUMBER EIGHT, DIRECTOR CLOSING COMMENTS REGARDING ITEMS OF INTEREST. I WILL START TO MY RIGHT. UH, DIRECTOR FLORES. UH, GOOD NIGHT. THANK YOU, DIRECTOR KIRKLAND, THANK YOU FOR ATTENDING. GOODNIGHT, UH, SECRETARY DUFFY. THANK YOU. THANKS FOR ALL THE UPDATES. UM, APPRECIATE THAT. GOOD TALKING POINTS. IF PEOPLE HAVE QUESTIONS WHERE WE ARE. THANK YOU VICE PRESIDENT THOMPSON. GOOD NIGHT. AND I'LL JUST CLOSE BY SAYING, UH, CONGRATULATIONS, SAMS ON YOUR FIRST MEETING. IT'S OUTTA THE WAY NOW IT'S ALL DOWNHILL FROM HERE. UH, GOOD JOB. GOOD JOB. UH, AND I JUST WANNA SAY THANK YOU ALLALL FOR, UH, BEING HERE. I KNOW WATER'S GONNA BE AN IMPORTANT TOPIC GOING INTO THE SUMMER, AND, UM, WE APPRECIATE Y'ALL, UH, Y'ALL DO A GREAT JOB FOR US AND TAKING CARE OF OUR REGION. SO THANK Y'ALL FOR BEING HERE. UH, AND WITH THAT, UH, WE ARE ADJOURNED. * This transcript was created by voice-to-text technology. The transcript has not been edited for errors or omissions, it is for reference only and is not the official minutes of the meeting.