recording in progress Okay, I'm gonna call us to order this is the Wednesday September 28 meeting of the Great Lakes Water Authority Board of Directors. Can I please get a quorum call?
Chairperson Quadra LZ here. VICE CHAIRPERSON Hendrix Yeah, Director Brown, your directors that your and Secretary Baker and Dr. Director Walker graphy are excused from today's meeting.
Okay, so at today's meeting, we're using our regular consent agenda format. I know that there are items from the earlier legal committee meeting meeting that we are going to move into the consent agenda. Does any other member have any item they want pulled either onto or off of the consent current consent agenda? Okay, so, Bill, the items from the legal committee meeting are items
nine G through v nine words through Victor.
Okay. So we are going to move those to the consent agenda,
and they will be items three, see, Roman numeral seven through 25.
Okay, do we have a motion to approve? Do we have one other agenda change?
Thank you Madam Chair. We would like to reverse Under Item nine new business we would like to reverse items number A and B and take B before a
okay with those changes. Is there a motion to approve the agenda motion to approve I'll second. All in favor. All right. Do we have a motion and support to approve the consent matters?
do approve support
All in favor?
Aye.
Okay, so moving to New Item A Oh no, I'm sorry. We need to talk communications. Is there anyone here we give opportunity both at the beginning and the end of the meeting either in person or virtually for members of the public to address the board. Is there anyone here in person that would like to address the board? Is there anyone who has indicated on the line that they would like to address the board
and as a reminder Madam Chair, they can do that by raising their hand in the application or with their participating by telephone by pressing star nine. Madam Chair at this time, I did not see any hands raised so a final call for public comment would be an order.
Okay, so this is the final call either in person or electronically by phone or zoom for public comment. Hearing none, we will close public comment for the beginning of the meeting. And can we go on to our first item now item a
thank you and that will be a presentation on the bond transaction.
Good afternoon Niki Bateson chief financial officer and treasurer for the Great Lakes Water Authority. This afternoon. We are pleased to report to you on the outcome of our most recent plans. bond financing to fund much needed capital improvements for our water and wastewater system. On August 26. We had reported to the audit committee, the updates related to the transaction on August 31. We had the successful bond pricing which you're going to hear about today. And our closing on the bonds occurred on September 13. The market proved to be very challenging on August 31. However, given that interest rates have continued to decline to climb since then, moving forward at that time clearly was the right decision and you'll hear more about that today. Overall, though, it's important to remember that this transaction has occurred in an era of historically low financing rates. And so we were able to maintain our financial plan in alignment with our forecasts to be able to keep an eye on affordability while balancing our cash reserves and our debt portfolio. Joining us today for our presentation. First I want to give recognize Ms. Kim Garlon financial services area chief of staff who is participating via zoom and is going to be driving the presentation online today and Kim if you want to move to the first page of the presentation and I would like to introduce today joining us is Dan Hartman from PFM, our financial advisor as well as his associate Eric Brown, and also I'm pleased to announce that today we have joining us, Miss Susanne Xiang from CBRE Williamson shanku led the underwriting team and we're very fortunate that she personally participated and personally made sure that this transaction was very successful, and a challenging market. And again, you'll hear more about that. So with that, I'll turn it over to Dan. After we go through this presentation, I do have Bart Foster on the line also I've asked him to comment Bart provides a feasibility analysis for our bonds and and talk about the financial plan outcome.
Great, thank you, Nikki.
Pleasure to be here. Members of the board. I'm Dan Hartman, the CEO of PFM we've been the financial advisor to Great Lakes Water Authority since its inception and certainly pleased to be here. Today we're going to talk about two bond transactions that totaled 117 million for the water and sewer systems. That is Nicki talked about priced August 31st and close September 13, and in very successful so as you can see in the executive summary, there's a number of salient points to cover I think that are all favorable for the transaction. First of all it procured or secured funding of $225 million for both the water and sewer systems for the capital improvement program. And, and that was really the core objective. Along the way we achieve a really low cost of funds of 444 for the water system, we're 57 for the sewer system. They priced the same way there's a slightly different structure, which is why the difference in rate but as as Nicky said we still secured funding at a time where rates had been lower than much of history and in fact rates have only been lower than where they are now about 34% of the time. So still a strong market notwithstanding the headwinds in the market today, and we'll talk a little bit more than that. And certainly since the time of pricing, we have seen nothing but rates continued to rise. So the 10 year Treasury when we price these bonds was at 3.15%. Yesterday for a brief moment that went above 4%. Just a very large swing within the span of only a few weeks. So the timing is was turned out to be the correct one. Locking in rates in this challenging market. From a rating agency perspective, we continue to see progress with positive outlooks from Moody's and Fitch, continuing the path that has been that the authority has been on of trying to move back to double A category ratings at all rating agencies. And I think as we'll talk about a little bit more detail, you're really poised to do that. And that in the near term, there was an extensive outreach to investors on the transaction. A lot of one on one calls a lot of work done by Nikki and her staff to reach out to the broadest possible group and Suzanne is going to talk through a lot of that effort as well as the results including a number of new investors that helped secure this low funding. And then the finally would just you know, the structures were really done to optimize a debt service, both from a budgetary perspective, as well as there was a small refunding effort that created about $2 million of cash flow savings. And in the next budget year on the sewer system, the camp is turned to the next page won't go through these, because I talked about many I'm just in the executive summary, but it's really that we set a number of goals for the two transactions. And the team really did achieve everything that we set out to do. We acquired funding at very favorable levels. It really continued the strong results in terms of investor response in broadening the investor community for GL wa bonds. The ratings continue to be on a positive trend, as well as the authorities financial flexibility was enhanced through lower debt service as well as the the overall structure. And we we opportunistically captured debt service savings on the refunding small piece for sewer as you turn to the next page, just want to talk for a moment about the the rating agency upgrades. This has been certainly near and dear to our hearts in terms of getting back to the double A level, you know that the system had prior to the Detroit bankruptcy. What you see here is that we have already secured the double A level senior lien rating for s&p and now from Fitch and for Moody's gotten to what is an a plus or a one one step below double A and now have positive ratings or excuse me positive outlooks from Moody's on both credits, and Fitch on the sewer credit in getting these upgrades or changes in Outlook, the rating agency cited a couple of things. One was really the strength of management and the stable operations in the system. And the second one was which is something that has been
certainly intentional was lower leverage, lower amount of debt that bringing that total amount of debt down for each system. And that was particularly important for Fitch. That's the reason as well of why Seward did get a positive outlook. Water has not yet gotten there is just slightly different in terms of the debt leverage metrics for Fitch, but both systems are heading in the right territory. We certainly believe that there's a good chance of getting to that double A category in the next in the next 18 months, which is really the timeframe that a positive outlook needs to be acted upon by the rating agencies one way or the other. So with that, I'm going to turn it over to Suzanne to go through some of the investor marketing as well as the market results.
Thanks so much, Dan. And I'm Suzanne shank, President and CEO of Siebert Williams shank on page 205. If we could go to the market chart, Kim, we amplify some of the points that Dan made in terms of historical interest rates.
There we are,
yes, so you can see if we look back at 10 year and 30 year MMD, which is a municipal post for the market and Treasury yields you can see how you know, in the environment where we priced in 2022. You know, rates are generally pretty low based on historical terms, even though they have risen from the lows of 2020 When you were last in the market, and 2021 the overall dominant theme, however, the financial markets, both stocks and equities, as you all know, has been volatility, and that makes pricing a deal into this market quite challenging. You know, just to put it into context. You probably saw we're 30 year mortgage rates just went through 7% This week, after starting the year in the low threes. So we are dealing with huge inflationary issues, just to provide some further context on that bottom chart. It shows on the left side, the timing of your last transactions, which priced in 2020. And then where we priced you know this deal on August 31. And you can see a comparison that shows that basically our rates were you know, much higher than they were at the onset of the pandemic and that they have continued to rise. And as Dan mentioned, we looked at the market at the close of the day you priced versus the close yesterday, and 10 year rates had risen at four basis. Points and 30 year rates 61 basis points. So we were really happy to get in the market when we did moving to the next page just to illustrate the increase in volatility on the left top you see 2021 rates fluctuated by only about 55 basis points for the tenure and 48 basis points for the 30 year and contrast. On the right you see 2022 levels. Now these were as of September 15. It would be much worse if we took that through yesterday, but we needed to get you the board packet in time. Rates have fluctuated 198 basis points and 211 basis points respectively for the 10 year and 30 year so on the bottom you can also see that we've been in a market of outflows from institutional investors, people pulling out funds and putting them elsewhere. Both sort of negative trends for the market. Going to the next page. The good news is though despite these very difficult market conditions we priced and held at very attractive levels. Enough investor interest to get our transaction done and in fact, we had about 100 million of bonds unsold at the end of the order period, and we got together with your advisor PFM and Nicoletta and her team, and determined then rather than downsize the deal, which was an option, we would restructure, remove some bonds around so that we could address the interest that we did have, and then we offer it to underwrite about 37 Millions of bonds at risk because we did not want to change the integrity of the transaction. I really want to thank the flexibility of the authority team and PFM and allowing us to do that. I also want to thank the authority team for getting on nine one on ones with investors, six of whom placed orders for the bonds, that three who didn't did not do so because of credit. They were very comfortable with the credit. They just thought we weren't. Our yields were too low. We had 82 views of the POS and electronic roadshow and we identified 14 investors who had not participated in this series 2020 transaction. So you had a lot of the big name investors that dominate the municipal market BlackRock, Vanguard, T Rowe, price, et cetera buy the deal, but we were pleased to bring in Lord Abbett, us trust, scatter and a variety of other names we think will be valuable investors for the authority going forward. And I just want to say on behalf of my entire team, we had a pretty large team working on the deal that we really appreciate the opportunity to lead this transaction was our first LEED manage deal for Great Lakes Water Authority. And I have to say personally, being local, I derive more joy from these local deals than the ones we do all over the country. So thank you so much.
And I'll turn it over to Dan. Thanks, Suzanne. Can we turn to the next page just in just a wrap this up again, I think the results of $417.7 million of bonds overall, which generated 225 million for each system. For 450 million of total proceeds. The water system at 4.44% in the sewer system slightly higher because of a slightly different or more backloaded structure. A 4.57% also did issue 12 and a half million dollars a refunding bonds that generated cash flow savings of 2 million and then we also were able to release additional 8.9 million from the sewer debt service reserve fund to enhance the savings by lowering the amount of overall debt and that is a been a pointed effort of ours, both to increase to use the structure to reduce the debts of reserve fund and then release it or to achieve savings. And on a long term basis. We're by getting the ratings to the double A category from two rating agencies will be able to fully release all of the debt services or funds, which would create more cash flow savings and where you, as noted hoped to do that in the near term given the positive outlooks from both Moody's and Fitch on the next couple of pages. Just stop real briefly. I won't go through the sources and uses they're there for each of you to see I would. You can see the structure for the water system at the bottom again, leveled out the overall debt service, trying to optimize the structure to give the most flexibility and still have a lot of borrowing capacity on the long end, moving forward and that's certainly a note of the reduced leverage over that's been the effort over time and cam has moved to the sewer system. You see the same thing again. The sources and uses by each of the series is there for you to see. But the overall structure again is leveled out with a lot of capacity out long to give you financial flexibility moving forward and the use of debt. And that's really been certainly an effort that's been successful in reducing leverage and the rating agencies also recommended and then finally on the transact I just can't overstate how terrific everyone had the authority as the staff of Nikki bill to Randall everyone just this is we work with foreign tour agencies across the country and many of the largest ones. And this is certainly among the, if not the best management team. We worked with. They really paved the way for Suzanne and PFM to be successful in marketing this and as well with with Bart foster did a great job on the feasibility report and Dickinson Wright is counsel so thank you and certainly pleased to do that. I'll turn it back over to
Nick. Thank you, Dan. And Thank you Suzanne. So again, I want to underscore the challenge getting the transaction that day and if you hear me say that I want to thank Suzanne 37 million times is because that's how much and bonds that her firm underwrote for us so that we could meet our goals that day for our funding for our transaction. So again, thank you. And again, the PFM team. You know, we have a lot of very frank conversations as we're going through this. You know, it's a very legal process and certainly compliance is a key element of this. A key element of the transaction is also having somebody who issues the feasibility report because we need to demonstrate to the investors that we are in fact going to be able to have a financial plan that secures the payment and the positive credit metrics on the call. I do have Bart Foster. I've asked him just to comment on the impact of this transaction as it relates to our 10 year financial plan.
Thanks, Nikki, can you all hear me okay? Yes, we can. Okay, great. Thank you. I'm just going to briefly outline what I'm gonna try to set the table for Lisa's budget amendment on the next agenda item by talking about what we knew back in February when the the original budget for fiscal year 2023 was approved by the Board and the developments that we know today. Leading to this budget amendment, which were largely incorporated within the financial plan for the bond transaction. So back in February, we had planned on bond sales, trying conservatively trying to get them done in June of 2022. So they would have been fiscal year 2022 activity. And we were seeking financing of roughly $175 million for water and roughly $135 million for sewer. That was the plan of record. We had approved charges to support the budget. And then as we got towards the end of fiscal year 2022. There were some developments that one of those developments had to do with Highland Park and a reinstatement of the judge's order to compel payments of sewer amounts 65% of their collections. When that occurred, the board opted to take out of the charges to all of their customers, all of the member partners amounts that were in there to cover projected bad debt for Highland Park. So we lowered the revenue without amending the budget. You'll see that that's going to occur in this budget amendment, but we did reflect that in the bond sale expectations. We also reflected we had assumed no payments from Highland Park at all back in the budget. And we have purpose of the transaction assume some level of payment in alignment with our interpretation of the judge's order. At the same time between February and June was when the inflation bug really started hitting all aspects of the organization and GL wa on the sewer side put through a fourth quarter budget amendment on the operating expense for fiscal year 2022. Recognizing the inflationary impacts on the sewer operating methods 10 and a half $11 million there abouts. We have reflected in the financial plan and then the budget amendment you'll see the expectation that that higher level of expenditure will continue. At the same time we were evaluating what does this what does this inflationary pressure mean to the capital program and if you recall when the budget was approved, we had assumed a capital spend rate of 80% on water and 75% on sewer as we entered the transaction we determined it would be prudent to raise those amounts to 100%. So now we got more capital need we've got right market conditions to support a larger transaction and we see that the interest rates are likely to continue to rise in the short term. So when we went to market instead of securing 175 million for water, and 135 million for sewer, the decision was made to secure $225 million of financing for both both systems which is what Dan and Suzanne outlined in the transaction before as a result of that, obviously, more bonds, higher debt service than what we had originally budgeted. But we balanced that somewhat by the structuring options that Dan outlined when he went through this presentation so that we were able to result in level debt service for the 10 year and longer period, but not take quite so much debt service hit up front. All this was in alignment with the board's approved debt management policy. A couple more observations and I'll be done. The other thing about the rising interest rates we do WA has in the neighborhood of a quarter billion dollars in one variable rate debt instrument. It has been the cheapest debt in the GL wa portfolio for years. During last fiscal year, the interest you were paying on that quarter million dollars outstanding was seven tenths of a percent or somewhere in that ballpark. Well with the rising interest rates, that variable rate has gone quite a bit higher. And even though it's probably the best debt instrument in the portfolio, we're budgeting that at 2.6%. That's quite a significant increase in budgeted debt service which we've reflected in the plan.
And then finally, the good side of the rising interest rates is that we have worked with the investment advisors to understand expected investment earnings potential, and there's a pretty sizable increase in investment earnings that is in this forecast and that will be in the budget amendments that Lisa introduces. So that's the good side of the rising interest rates is it takes some of the revenue pressure off of charges as we start to enter the season for the 2024 budget and chargers cycle. So I'll leave it there and reiterate the comments from both Dan and Suzanne that the transaction team is extremely professional and the outcome is fantastic for the authority.
Guide. Thanks, Bart. So as Bart outlined, we had a lot of changing conditions over a short period of time. My thanks to the audit committee who sat through meetings going through our updated exhibits and forecasts and plans as all of this played out and to this board for their due diligence and reviewing documents that led to this transaction. So with that, that is the conclusion of our report to you on the 2022 bond transaction.
Thank you, Nikki. Does anyone have any questions for Nikki or Suzanne or for Dan or for BART? No question. For me. Well, on behalf of the board I we said this at the Finance Committee meeting but I will say it again on behalf of the Board. Thank you everybody for I am scared to say one of the most challenging that we'll face because God will just say thank you for an extraordinary result under really tough circumstances. So
Madam Chair, I got the impression from just listening to the report and and feedback that I've gotten from your audit committee. This one was a little I guess, on the extrordinary side, given the economic circumstances in which we were out trying to get this transaction to take place and so I think that is is that a fair? Okay. And so I want to say thank you to for the everyone involved in this team that got got this up, got it going. Had a couple of hiccups along the way it would have been easy to just go to pack up our tent and say, well, we gave it our best shot. Let's reconfigure this thing and call it a day but that didn't happen. You all got your heads together and figured out a way of pulling it together and getting it done. 100% And so I really appreciate everybody in Baroda I appreciate you especially. I appreciate you even more of I saw you in person. It's been so long since I've seen you and you know we got people coming to work every day. We got this whole team in here and if you got reasons that you can't be here, I'll be the first to say stay home. But uh, it'd be nice to see you in here every now and then. Okay. And one of those nice suits that you wear, so but thank you for your report.
I'm working on a premium. Thank you. All right.
Okay, so are we in motion to receive and files. Okay.
All right. So move forward.
All in favor. Thank you very much. Well done. Okay, Naveed we are going to hear from you on our resiliency improvement update. Pepperidge was Suzanne shun
you were right there making it happen. Thank you will ask that you've been working in five years trying to get in here? Well, she didn't give up
yeah to get upgrades we got reserves released we got CEO and president this pic Lee. Right Yeah, yeah. Yeah,
I'm gonna
Exactly.
It's up on mine.
Oh, it's focused on BART. They just gotta adjust that you can see this.
So why is BART
has got this person okay. Right now they can see exactly what no worries. is not one here. Exactly what they can see during our project and having
Okay, perfect. Good afternoon, Madam Chair and now the muram chief operating officer for wastewater operations. Today we're going to do a presentation and really an update on the NG LW as resiliency strategy. Going forward, as in response to the June and July events and some of the reports that were done, started last year finished up this year, and we're going to really focus on those to start off with some background and the screens here will be updated shortly. But the online individuals will be able to see the presentation. So there we go. Now we're rocking and rolling. So GLBA tributary area 944 square miles of service area that we have about 76% of that is separated and 24% is combined. The graphics here kind of shows the representation of the entire tributary area and area and then the hatch shows the separated area. So this graphic really gives you a high level of the sanitary system assets that GL WA is responsible for and operates. Specifically, we have three major interceptors, but a combination of a total of 190 miles of sewer interceptors combined. We have one water resource recovery facility one of the largest treatment facilities in North America, five combined sewer overflow facilities, three screening and disinfection facilities, nine sanitary pump stations some are combined sanitary and storm water pump stations 17 in system storage dams, these are basically if you can imagine large balloons that are within the pipe that allows us to inflate them or deflate them to allow flow to move. Out of that 1711 of them are which are used for flow management and water quality allowing us to capitalize on the in system storage what we refer to which is keeping the water in the pipe as long as we can before we release it into ideally to the treatment facility but if the system is overwhelmed to the to the outfalls to 200 and I want to emphasize this 230 level sensors throughout our collection system. That's a lot with respect to just monitoring assets that are buried with the underground that our team maintains 39 out falls along the Detroit River and 17 outfalls along the Rouge River and these outfalls are gravity type outfalls that come on the come online as the system. Water levels rise in the pipes and it either the sewers are full and they're not able to convey to the to the water resource for treatment facility or as a combined sewer of facilities. Those facilities come online and discharge to the receiving waters. So what happened 2021 As we all know on June 25 26th event, storm began at 3am June 25 and and 24 hours later concluded on June 26 peak intensity as went up to up to 15.5 inches per hour over five minutes of duration maximum accumulation experience was 7.8 inches, over 12 hours and 8.1 inches over 24 hours and then on July 26. Similarly we had a large event started at 6am and completed by 6pm over 12 hours with a peak intensity of 11.8 inches per hour over five minutes and then a maximum accumulation depth of 4.7 inches over 12 hours. I think it's important to highlight here that the accumulation of water that we experience in our 24 hours for the June 25 26th event, equated to about 24% of our total annual accumulation that we experienced over a year on average. So typically we experience close to 3334 inches of rain. Sometimes we have reached 40 inches of rain but this this was pretty intense amount of water that we received.
So I think this highlights that a little bit more. saw this in an article be extrapolated here on in a slide but shows although we unfortunately experienced that in 2021 the country in the world is experiencing and a lot in 2022 A couple of the sites that I want to highlight St. Louis morning of July 26 experience 7.8 inches of rain that fell over six hours. total accumulation logged over the for the day was about 8.64 inches. So with them they experienced about 34 inches of rain annually. So for them it was about a 25% of their annual precipitation. Eastern Kentucky on July 27. They experienced two inches of rain in an hour. Eastern Illinois night of August 1 experience eight to 13 inches of rain over a 12 hour period. Eastern Illinois very similarly experienced is about 45 inches of rain 22% of the precipitation they experienced annually. Although the number of volume for Death Valley California is very low. 1.48 inches of rain. But to put it to perspective, they typically receive about 2.2 inches of rain annually. So So again, in every one of these cases, I think it's so important to note that the system was overwhelmed with the amount of water that they experienced. And it resulted in the level of flooding that each one of these areas of experience and just as much as early as September 11 This month, northeast Chicago as you may have read on experienced approximately four to seven inches of rain as high as nine inches of rain in at some points and at as high as three inches per hour experience in northeast Chicago. So to me in the in the responsibility that I have for this organization to me those are near misses. We got lucky that that type of precipitation didn't hit us because again, each one of these the volume and intensities that these areas are experiencing outside of California really would have exceeded our capacity just as much as it did there's because our system is not designed to handle this level of water nor is there's the preceding the June 25 26th event and July event and internal and independent investigation was completed. The investigation really looked at our pump station operations or vulnerability assessments, electrical testing and coordination, reviewed the sewer modeling to assess to determine what what occurred. A review of the total collection system was done with the through through several data points and several reports were created. As as requested this board that report was consolidated under one and it was published by a cop and and so so this is really all that have happened since the event in June 25 26th I know the screen is a little bit crowded, but I think it's also important to note the amount of work that GL WA has done since this event has occurred. You will know that the green highlighted items are activities that are that initiated and completed within the collection system, most of them around the PLD conversion, how our monitoring to give us some advanced notification with respect to our power qualities. A couple other items that I want to highlight at the top of the screen you'll see several meetings that have occurred with our Eastside member partners at Westside number partners. Although we have regular meetings with them, these are the ones that we want to highlight that where we talked specifically around level of service. We talked about operational strategies. We talked about coordination opportunities for phone calls and coordinating the contexts that need to be notified in the event of an emergency. Couple other items to note here are we did submit an extreme event operational strategy to Eagle many of which are just to be able to ensure that our team has all the tools they need to be able to take all actions necessary to
to be able to respond to an extreme event. More importantly, it's not much different than what our team does on a day to day basis. It was just more of making sure our regulators are on the same page as us so our operators can continue doing what they're doing. The other other items are the legislative effort regarding the flooding study. See Oh coffee has been talking on this a lot. This is an effort that is needed for for this area to be able to get a real real effort towards towards a high level solution for us. This item has been approved by the Senate and the House and through the Water Resource Development Act. We are hoping that I believe it is teed up for the fall conference and expected to pass by your app. So we are hopeful for this. This will really be able to expedite many of the efforts in taking a look at a whole whole regional system strategy for flood mitigation. And then finally some some on site. Reviews of the Chicago tunnel and reservoir project was done. I think this was a partnership with Detroit DWSD and GL wa to walk that facility this was an Army Corps project to see if you know what type of methodologies could be applied to mitigate. Keep in mind that this project I believe was a CSO control project, not necessarily a flood resiliency project, but it is it is good for us to be able to determine all the technologies that are out there and strategies that have been used in the past. And then finally, I am proud to announce that the in system storage devices and remote valve operations were all put into operations. By 2022 By August 24 2020 So this was really assets that were working that did what they were supposed to do but we identified some some challenges with level sensors some some areas where the system blinded and all those that the operation and maintenance team really champion those and got them up to working conditions and reliable conditions. So that that is also another exciting new so a lot has happened since a couple things that are not on the screen. The 230 level sensors I referenced they all have been officially calibrated and completed so that they are in working order. However, as part of this assessment process, because we didn't just go out and calibrate on VSS them to determine if there's more needs. We determined that 78 of them were in good constellation status they were good, they were operational, they will continue to stay in their current status. However, unfortunately 152 of them be determined that although they worked, they were calibrated. They did what they were supposed to. We need to relocate them because when we get extreme events and water levels rise beyond levels of design capacity, we go blind what we refer to which is the sensor gets buried of water. We have to relocate the sensors to higher points so that we can monitor during extreme events. So it's not a defect. It's more really now we have a new bar we have to try to measure and we have to figure out a different strategy to do that. So that is one of the task items that the team is on is underway with additionally, five additional sensors were identified by the member community communications and finally on a on a another great note DTE we have been reimbursed for all the PLD conversion of a total of $845,000. As of today, we have been we have received payment for all that effort. That went underway. So resiliency delivery team so how are we going to get done what the report recommended, evaluating and and make taking action on those different activities. So again, another lot on the screen but we can spend some time no reason to flick through slides and just was just talking about content. So I'll start from the upper left and work to the lower right on responsibilities and activities that are going to be done. First off, as at this point, I will be championing as your program manager moving this initiative forward to respond to all the recommendations that were provided by the AECOM report. The
as you can see, the first box directly to the direct reports are different team members that are going to be responsible for championing many of the activities that are listed. The to start off Sarah Ann will be as our general counsel will be responsible for making sure that we document accurately all the effort that we're going to be doing in response to a comm report to make sure that it's all documented so that in a few years from now, when another extreme event occurs, we're able to reference this document and ensure that all the activities that we have done have been in line with a common recommendation and if we didn't do it, why we didn't do it and why the recommendation was not moving forward. So Sarah Ann will be tasked with assigning in addition to our tasks, she will be working with the communities. This one is important because it's really far outside of GL who reach this is really OS as part of the recommendation to be a coordinator and assist as a resource not necessarily be responsible for community programs such as flood prone areas. Working with the communities to manage flood prone areas, potentially working towards apologize. It's even too small for me to community programs, community and enrollment to National Flood Insurance programs and updating their FEMA maps. Again, this is something that the communities will be doing, what we are just basically going to have be a resource for them if they have questions or if they want us to engage our insurance agency to be able to help them. As it relates to public education, communication, one thing we learned is the more we can educate the better our our communities will be in an event like this because again, this will happen again. As we have seen across the country in 2022. So Michelle send ASCII. Michelle will be sorry, I can't never get your last name I'm sorry. The will we will be conducting the public outreach. This really concludes community meetings, education, material development, program communications, progress updates with communities and any town halls that we may want. We may need to do to be able to help the communities to understand all of our efforts that we are moving forward. Real quickly, we do have a technical advisor team. These are our very experienced team members that are within our field and operations. very in tune with all the activities that are going on, but because we still have to operate there they are going to be functioning in a technical advisory role and assisting the team to make sure that you are following track appropriately. So now getting into the details of the project. We will be assigning a detail engineer to be able to navigate some of the technical requests that were directly identified. Some additional electrical upgrades to all the pump stations evaluating the pump stations to see what opportunities there are to maximize the flexibilities and redundancies and reliability. We are going to look at the Conner creats sewer system vacuum priming system and seal water system upgrades. And then I'll talk more in depth about the Conner Creek vertical turbine pump alternative in a little bit here, but that will be another project that was recommended that we are going to evaluate some projects that the team have had the forest sites and have been on the way our field engineering will be completing the continuing forward the projects of Conner Creek Sewer Cleaning and rehab. This This contract was before the board recently and approved.
The CIP for the in system storage devices and outfalls. This is actually overhaul of assets within that system. CIP for fruit and storm pump station rehab this project is in final phases of design and soon to be expected to be out for bids and then also and new fruit sanitary pump station for for managing the low flows and allowing us to isolate the fruit pump station as we have kind of talked in the past fruit pump stations are workhorse and we want to make sure we focus on that and get that going as quickly as possible. A couple of operational tactics that were recommended in the report some were identifying different ways to start the pumps, different sequences to be taken into consideration. This is different than what our team has done. And it's not something we would just roll out. Operation of these pumps are very tactical, because if they don't, if we try to do it during a storm event, it could potentially it could backfire on us. So we have to come up with strategies to test these strategies and see if it makes sense for us to proceed. In addition to that, there was some additional recommendations for for our generator operation during storm events. I think there's some high level concerns in those areas that we have to review, but this will be handled by our operational and maintenance technical leads. Our system planning will be really championing some of the foresight items that were identified in the report level of service dynamics system operations. The feasibility of us going to 100 year storm, comprehensive flood solution. So some of these things and this is why you'll see on the schedule GL wa totally in total is looking to strategize this and how the Army Corps project will move forward. If the Army Corps project moves forward, several of these bullet points may be able to be captured by that so we don't have to have dual efforts going forward. But we are identifying this as if that Army Corps project doesn't pan out. We still have to do all of this because it is important to make sure that our member partners understand what level of service they should expect from us. And then finally, research and innovation team will be leading the the kind of doing a national survey like DWSD and GL wa did was Chicago and just to make sure to see if there's other strategies that have been have been considered nationally that could be deployed here in southeast Michigan. So that's our team. We're very excited to move this effort forward. This, I believe allows us a focus point of accountability, to be able to make sure that things do not fall off and we continue this effort forward.
This is really the schedule that you're committing to some of them as you can see are far out and and and I'll kind of highlight a specific one here vertical pump alternatives, as we talked about. So this is very similar to the bullet points you saw in the boxes before by whose champion but you can see the vertical pump alternative kind of goes out to 2027. The challenges with many of these projects our verdict has has multiple dependencies and touchpoints. So for us to develop design will likely take us close to 12 months for the manufacturer to procure this, our manufacturer to construct the pumps will likely take us about two years. For the for the contractor to install will likely take us about a year. And then finally we want to make sure we tested and validated before we go forward with implementing the rest of the recommendation. Because this is for example in this case, the recommendation from AECOM was let's evaluate two of the eight. So we will put two pumps in place make sure works. If it's feasible, then we will move forward. I also want to highlight here that for this specific item I have a meeting scheduled tomorrow with entire technical team. I have now two reports to some extent contradicting each other one from our technical team that saying this is not a feasible option. And I have one from the AECOM team says that this is a feasible option. I think there's different things that both parties looked at and they both have valid points and we're going to have a nice conversation tomorrow for about five hours to determine what is the right thing for him to do for GL wa because it is very creative. I will say from my perspective that requires and validates us spending the time to determine if it makes sense to move forward or not.
Would you
say that again? Maybe which part? Sorry, you said you're going to have a discussion correct with
so we the parties that will be attending here will be a comms technical pump experts Arcadis national pump experts, Clemson our physical modeler. University will be on site U of M will be there. And Brown and Caldwell national pump experts will be there so every punch pump expert in the US likely will be here because these are there's not too many of these guys that are out there that design this size pump so we have the right people in the room to make a determination what's the right direction to go. Again, some more scheduled here before you for your reference. And you can see some of them are very long. Some of them we have a lot of control over and are shorter. So we hope to be able to, as part of this really provide quarterly updates to the board on our progress with respect to these schedules. And keeping you informed as we advance forward. Finally, some success factors. These are some of the success factors that I look to the program team to deliver on implementing the short term two to four year recommendations. Maintaining a reliable operation of our center pump stations, maintaining power reliable ability, while ensuring flexibility. So this is right. We do that we do many of these today. But what this is with the lens of integrating those recommendations to be able to maintain that type of flexibility that we don't have today. Maintain operational readiness for large intensity storms. Developing a real roadmap for the concrete pump station. This is this is specifically referenced at tomorrow's meeting and our strategy going forward. Evaluate system awareness and condition assessment of our entire sewer assets complete and accurately document the progress of this effort. Because this is what we're going to be held accountable for and for our team to be able to reference after all of us are out here. So and then maintaining a consistent communication and operation of our
sewer system
through our public affairs. This point, I will thank you for your time. I'll take any questions.
Just I'm sorry.
I saw Jack hand up. No the general way.
Thank you. Thank you very much. Oh can you talk to us a little bit about what you've learned in Chicago. You mentioned in Chicago, that a team from Detroit water and sewer and yourselves went? What did what did you find out in that tunnel? Project?
I'll let Miss coffee for sure. Happy
happy to I think good question. So Chicago. implemented this long time ago when they determined their CSO control strategy. So as Naveen said, that's a little bit different. But one thing we learned large diameter tunnels partnering with the Army Corps, that can happen and it can happen in a way that we can hopefully procure some federal funding significant funding. This is one of the reasons why we're doing this. So we can do large studies. But when the Army Corps does a large study, there's a lot of confidence in their ability to execute that work and do it well. So when we go back to the federal government, which is how word of works this Water Resources Development Act incrementally to seek funding, it positions us in a way that we're going to be in a better position than had we done it ourselves. So, so the practicality of going this route with Army Corps because when we went so so director Brown went, I went, several of us went, we did we did so with the Army Corps, and had the Chicago project engineer walk us through so so deep tunnels yes, that work for them. Parts of what they did, we might not implement they had some large when I say large i It's hard for me to I have to explain, like exceedingly large quarry size, open tap reservoirs. So if you drive to Chicago, you may have seen these, they're empty, they look like a quarry and they fill with combined sewer flows during rain and then they discharge them back to their treatment facility. So similar for me, the biggest thing is the fact that this is this can be done it can be done successfully, and in their case, a 65% match from the federal government on the construction dollars. So it's just the beginning of exploration of options. But our partners in Chicago and our partners with the Army Corps, have an excellent example for us to follow. So So for us, I think as Naveed said this is the first probably of many tours that we will do around the country to look at different options. So for me, it helped make it real, not just this idea that someone may have that that's kind of out there and you know,
theory land you have a calm with you or Wade trim or just
we did not we did not we went we went out and talked really practically, you know, how did this get constructed? What is it like to operate? What is your level of service? What kind of issues did you have as you went through this? They've been working on this for more than 20 years. So it's been a long process for them and they're not done. They're still working.
And after this technical meeting takes place tomorrow and perhaps there'll be follow up meetings to it, et cetera. Will you be able to brief us on what what is covered? When you said you have a pro and con kind of situation I'm always interested in how these outcomes workout.
Yeah, I think that's a really good question. So I see this as well. No, that's so I see this as a to several steps. Absolutely. This board will be updated as part of our progress update or I can provide additional updates as necessary through communications. One of the things that I want to make sure that we also do there was a lot of effort during the value engineering of this project, and we have our member partners involved. So after we get through the technical phase portion of this discussion, I will likely engage some of the member partners that were involved before to bring them up to speed after we get through the nitty gritty of the of the effort to bring them up to speed about what the outcomes have been to make sure that we're all walking forward in the locks lockstep with the decision we will make. So it's not going to be the final decision. I don't anticipate tomorrow, right. I'm just hoping that we will be able to get to a point where everybody can wrap their arms around a direction forward that they all can agree to technically, then we can take that to next steps and engage your member partners and make sure that they are in lockstep of the decision.
Thank you. Freeman and then
it's a good presentation of Eden is a lot of information to digest. And, and I'll spend some time looking at this in more detail. And if I have questions, I'll certainly know who to bring them to. I guess sued to them. This is basically a question for you. Does any aspect of this project involve? I guess, restructuring or reorganizing the overall structure of the authority in terms of assignments, where things are being assigned and so forth?
Yes, it very likely well, okay, are very likely well, so we're not quite at a point to roll that out to you. But it is something we've been talking about since the initial recommendations came along. What we really are focusing on today is we want to make sure that you understand that we we heard you when you when you made the comment about this has to be a living thing. This cannot be a report that you put on the shelf. So we'll roll it out incrementally I would expect in the next three month update. So quarterly, we're going to update you lots of detail. You now see the framework that Naveen is working through so that's a big piece of it. We've assigned Naveed and assigned specific people to elements of the recommendations, but in terms of the organizational structure, you'll see some changes. Yes, we have some very good ideas that we've been walking around for for a few months now. But we haven't quite landed. We're close but yes,
so and the reason I bring that up again, because that's since that. I remember in the early months of this year, where you kind of opened up and asked various folks their thoughts about the organization responsibilities, where emphasis needed to be and so forth. And I've talked to colleagues on the board and I mentioned to you at the time, that one of my biggest I guess concerns on the heels of the flooding, the manner in which it was perceived that we didn't respond properly. And that from a structural standpoint, what are we doing organizationally, to put pieces in place? So that there there are individuals sitting atop the organization on the lookout if you will, monitoring, interfacing with meteorologists, I mean doing all the things. And at the same time we have folks like Naveen and like Cheryl, who get up every day and do the work that they've been tasked to do for as long as they've been here. But when we get these 1000 year, storms every two years, we've can't very well expect them to carry out the responsibilities that they do every day 24/7 And then also be on point in a manner that is going to satisfy our ratepayers and the general public that we're responding quickly enough. That's kind of the conversation that you and I had. And I was implying in there is there's some restructuring that makes sense where a box is added somewhere where staff is added somewhere because to do all of these things. Everybody's budget conscious and I know you are because you know that we are but to for me to expect that we can add these additional pieces that are so necessary, and then layered them on top of the people who are already to me seemingly parently overworked might be asking a bit too much. So when I look at the structure and I look at who's who's got the staffing under them and how many boxes are sitting under each of our executives, adding more here Are we are we just moving chairs on the deck of the ship? Or are we actually bringing additional resources to bear so that we can spread the responsibility in a way that we're prepared, and we're also doing the work that we're asked to do every day. If I've jumbled that up
that's okay. I think and I think it's a good question. So last year when we weren't went through budget time it was post storm. So we had identified you know, yes, we need to add people, right people make this go. Right. We have great, great talented team members. So we did have a provision for us to be able to add talent as we were able to restructure to some degree and so I do think a structural change will drive the change that you're talking about. We did put some or had some allocations in our budget to be able to expand in that area last year. So in the budget we're in right now. So that we're now able, as the talent presents itself, and that's where the pieces is challenging, because we know that we need to be able to add more talent to the team, but we're also in historically tight labor market. So we have our eye on it. And we believe and have resourced so that we can add when the talent comes along. You might have noted in in one of the orange shirts or the orange shirt that Naveed went through, he had a TBD under a lifecycle project manager. That's one of the reasons right we know that we can't get all this done without additional resources. So there's kind of a combination. Some of that might be able to be done by contracted eight cam supports us in a way that provides some project management for us. But we really do in our proceeding with adding what we call lifecycle project managers to our team. Naveed has added some of those recently I think we have three so we are doing both as fast as we can but it's a challenging market to do it. But you're exactly right. We can't expect we're going to have something different if we don't change something structurally,
if there are individuals within the organization, that merit being moved up. I mean, that I think is something that many board members if not all of us, prefer to see us promote from within those who are talented, experienced and are ready to take on additional challenges. It's easier to feel from the bottom up than it is to find somebody to put in at the top and so I think you answered my question I just you know as we sit here as a board, there are certain things we just won't be involved in, nor is it appropriate for us to be down in the minutia. But these are real, real important and everyday decisions that affect the people who are in the organization. At every level. And they all have very strong opinions and I'm trusting that the manner in which the dialogue takes place. That there's the inclusion of everyone and hopefully the honesty amongst staff member, again, at every level can put it out there and if they don't believe something is the right thing, or if they disapprove that they're free to voice that and that it's, you know, it's discussed, and it's talked through and that the answer that we ultimately come out with is really in the best interests of everybody involved, because there's going to be give and take, and there's going to be some folks gonna have things taken away and some people are going to have things added and they're going to be places where we're going to create something totally new. But what comes out at the end, again, hopefully is is something that's going to work best for the authority and for our ratepayers.
I appreciate that. That's certainly our intent.
Gary, did you have a question?
Yes. Just briefly, not so much a question but just a comment. First of all, I appreciate it and thankfully will let me tag along to the Chicago trip. It was much more valuable having gleyber engineers there that were asking questions that I got a chance to, to hear the responses to them for me to go without out that team so I appreciated one take away two weeks before we got there South Florida, South Florida, South Chicago flooded. The the project that we looked at, as was said was not a flood mitigation project. It was a CSL project, but be that as it may in today's dollars, it cost $9 billion to do it. It got started in 1970. It was supposed to be done in 1985. Still not done. Just to put it in the context nobody's I don't think anybody's sitting into to Jefferson and Chalmers $9 billion to resolve any flooding issues. You know you could buy, you could buy all the houses and relocate all the people for a fraction of that cost. So it needs to be put in perspective and there were a lot of things in that project that we might be able to utilize. So I think it was a very valuable trip. I appreciate being asked to go and have he talked about the 30 230 sensors that have been calibrated and are now not working. My assumption is those sensors are there to buy us some time upstream before so that the people that are watching the instruments can can make decisions and so I hope that along with the 230 census that are calibrated that we move forward making sure that the people that are actually there and going to use the data are equipped with the knowledge and training and those types of things and I'm sure that that's that's in the making. I'll say the communication peasy. You know, we've been meeting with Jefferson Chalmers for every two weeks. The mayor has a major meeting on the 11th of October. I think it would be good for us to have a separate meeting. I don't think people are looking for us to say that. We want to be a resource to them. They're looking for us to be the experts and tell them how they can get out of the floodplain because they can't get insurance because they're in a FEMA designated floodplain. That's what they want. They want to be out of the floodplain Great Lakes Water Authority can't make that happen in and of itself. But at the same time, we don't want to go in saying that we're here to be a resource. They're looking for us to come in there with answers on how we're going to fix the problem. And and so I'd like to have a separate meeting and maybe share with you some of the things that we've learned over the last two weeks and make you more valuable in being that resource in these future meetings. So I'll leave it there. We'll talk on the top on the site.
Interviewed I want to thank you very much for doing exactly what we had asked. We said we don't want this to be a one and done study. I think everybody was probably independently very clear on that. And really appreciate the effort that you have all put into making sure that that doesn't happen. So I thank you very much. And John, you had a brief comment
real quick, real quickly. I'm very happy I'm sure the rest of the board has to about all the things that you've done already with the power issues and and you haven't been getting these air these sensors checked out and you're gonna have to move some of them you said to higher ground and and all I wonder is there in the Jefferson Chalmers or in that area. Looking at this map on page 180 of our packet is there are some areas there, open space areas. kind of piggybacking what you just spoke about in terms of our Suzanne spoke about in terms of Chicago, where some excavation could be done. And some of these some of this water could be diverted to these places. I know you've got to get approvals and that kind of thing, but I know there's a lot of vacant land in Detroit. Where there's been houses removed and businesses removed. Maybe that would be a short term solution.
Sure. And so I think there's it's twofold. One, the the resiliency study that's being discussed is really going to champion stuff like that. If there's opportunities, rain gardens, and those things are sometimes not the ideal even even because it's just not going to be
a garden so people don't get in there accidentally,
right. Yeah. And then most of those areas fall within the local systems right to be able to to store that type of volume because it's more manageable on the local system side of things then on the regional side, but at the regional level. Our expectations would be that those kinds of consideration if there is if there's a need for reservoirs off the regional system, for this army corps study, or this more holistic review of the region could identify if there's capabilities of storing space. I don't know if anybody else from the executive leadership team has more insight they would like to share on that.
I was just gonna, gonna say that there's a big difference. So first of all, we weren't in Chicago, we were in Burridge. We're about flux is about 45 miles southwest of Chicago. So it is it is a very, it's a very rural area. And so they were doing air drying of solids. And they had these large lagoons the scale of that CSO, which gave Chicago frankly the same same capacity that we currently all enjoying this metropolitan area is untold. So I don't think that you're likely for a number of reasons to find an urban an urban location that would would accommodate something like that. So at least as one participant in the trip, what came back is that we need to look at a slightly different approach as we look at what is what is appropriate for for Detroit and I think at some point, we probably will look at other communities like a walkie that also has a deep tunnel, like use a slightly different so there are other other models out there. The final thing that was particularly valuable, at least to me, was spending time informally with the Army Corps and just finding out what their thoughts were on the study and how we could help move it, move it forward. So I just wanted to add that in response to your question we built
and I get a motion to receive and file I think we should move along motion, support. Second, all in favor, aye. All right. Thank you. All right, we are on to Nicki resolution to approve our fiscal 2023 First Quarter budget amendments.
Madam Chair, I know C and D require an affirmative vote of five members of this board. I have checked but I do not get to five I've done it several times during the meeting. Both just did. So the question the question to the board members are do you wish to pass it to your to your next meeting or do you want to discuss it and then move it to the consent calendar for your next meeting at Roll Call is not we just traditionally do it but it is not required. And if you think about consent matters, have an affirmative support of the entire body. Mr. Baker obviously has participated in audit and we can do an individual briefing for Dr. Walker graffia if you want to go through it today if you want to pass it to a future meeting, that's fine as well. But we wanted to give you those alternatives. That view
is if we go through it right now we're going to have to go through it with Baker again.
So I'll make the motion to move it to consent. I I agree with Bill that Mr. Baker heard a lot of it at the audit committee and can get a briefing separately
and okay, we should move it to the next meeting. Okay, you want us to go through it now and then move it to consent if you the rest of you are willing, because I think we're saying we should just move it because we're gonna have a Mr. Hendrix and Mr. Zack haven't heard any
talking about is your motion, Gary to move it to the works study meeting in October or to the board meeting
next Monday where we have five Yeah, at least five members, five members Yeah,
well, either one, but I'm okay with moving into October. Okay. Okay, that causes any heartburn for Tiki?
Or are we moving into that meeting on the consent calendar or on the items for discussion, in your view, Mr. Zack, because I think we now have three views.
I don't mean to confused the subject.
I thought that we were going to move it to the regular agenda because we're going to have to have it discussed. For the next meeting. No,
we will do that. Thank you. That will be item CNDP.
Yes. Okay, so she II that's not one of the ones that we kicked to the No, that was not okay. So, Bill, I guess this is you and or Randall?
Sure. Madam Chair each year, under public act 152. We are asked to consider how we will pay for health care. And as you know, there are several options available. There's a hard cap. There is an 8020 where the organization puts in 80% of the cost the employees put in 20 Many municipalities in Michigan enjoy 9010 I think we've talked to the board and with your direction are still trying to seek a legislative sponsor to put us in that 9010 group but this is a resolution that would allow us to continue the 8020 arrangement I do want to note for the board that unlike prior years, in this year 8020 is slightly more expensive than the hard cap number. But we still recommendation is still to do that just given the labor market that we are in to continue the 8020 and I also will note that as as we've gone through some of the collective bargaining agreements when the initial collective bargaining agreements with some of our unions were put in place, they enshrined at 20 for the members of that union. So for those reasons, we would recommend a continuation of the 8020 cost sharing for healthcare.
Any questions on that?
Just a quick one bill, how does that compare to 9010? You said you're trying to find a sponsor. What's the
goal if it would mean that the cost we would pick up an additional 10% and the employer would pick up 10% less of those costs? So it depends on whether it's a single family or multiple but it isn't a large dollar amount, but for is we're looking for operators, we're looking for people that are coming from the public sector and one of the things that we've heard is that where they are they get 9010 on their health care, and it's 8020 here. It's like gasoline. It's one of those, one of those things that's very sensitive because people feel that cost every month but it probably would be it would probably be less, I think at this point than $500 a year to to the employee but it's one of those things I think that is important
rather than 10 Miles asleep three cents of gel. Correct. Having done it I understand that did you send we're trying to find we need a sponsor in Lansing. In order to get that through.
We need a sponsor. Yes. And so one of the challenges is that pa 152 was part of the emergency manager package. And as you might imagine, there is some concern on both sides of the aisle about reopening that package and so we're trying to get a very limited change in place but certainly I think you know, the 8020 Alright, wouldn't be appreciated or you
know, it's you need a motion. I do. So move taking on the 8020.
All in favor. Hi. Hey. IMF discussion regarding the board meetings.
Yes, thank you Madam Chair. You have received in your packet, a proposed calendar for the next calendar year for 2023. Just wanted to make sure that you're aware of it if every board member would take a look at it. Hopefully next month, we can come back see if any of you have conflicts that we need to address in scheduling. The other thing that I do want to make the board aware I was that we are not planning to continue a practice that we had one time as a board of community meetings. Other than that, we are still looking for an opportunity where health and others will allow us to go to Flint. That's a commitment that we made. And we will we will ultimately add that for the future. And the final question is, is really public participation right now. We we allow the public to participate remotely. I think there is there are further amendments, the over music going through in Lansing I think that is going to be but I know that several public parties have said you need to appear in person if you wish to give public comment. So my question to the board today is is there any reason that we want to change our procedures that we that we've utilized this past year regarding public participation?
I personally would like to make it as easy as possible for your public to communicate with us.
That's what we we assume? Yes. All right. And then so with that, if you would just pass it, pass it for the day, and everyone take a look at their personal calendars and then be prepared. When next we gather to we'll bring it back under old business to see if there are any conflicts or if you've identified conflicts today. Just let us know so we can start to look at is
this significantly different from what we have this year bill? No, sir. Okay.
Thank you. Okay. So we will pass that on the agenda and we will all commit to make sure we don't have major conflicts.
Thank you, Madam Chair.
So we are I think we're in this everything else is on consent. So
everything else has been approved through consent. I think you are now
have any reports.
We have no reports. Madam Chair.
Do we have any remarks?
I just have a memo that I want to give to staff because we were asking that a matter be referred to operation and Resource Committee to be handled there.
Okay. We're on to our CEO.
Thanks very much. Thank you very much. Yes. So I would like to start with a brief update on the status of the water main break that occurred right we had 120 inch diameter water transmission main break on August 13. And I know the report says September that's obviously a typo there. But so in August, we've been dealing with this for a while Miss Porter is our incident commander. She has been expertly navigating us through this and I'm pleased to share that the physical repair the main has been completed. So the main is repaired and we had a number of important milestones to hit. Those milestones have been hit, and the 26 miles of pipe are refilled. Excuse me with water from our Lake Huron water treatment. Plant. So we began working with Eagle to implement flushing and disinfection. And flushing and disinfection have been progressing. We are working toward it's very technical process and really, for us, this is not something that is an everyday matter and it's not something that's an everyday matter for Eagle this large size pipe and the long length of the pipe that needs to be flushed and disinfected. Is is something that had we had to work through and we we have successfully worked through that and we are working through now. Water quality testing to put that that pipe back in service and really move the operations of the system back to a normal state. So we're working through that right now. And we still do have updates three times a week with an Emergency Operations Center, where we briefed all of the impacted parties on the status of this and when we have had very good communication. I want to thank everyone for their patience as we've been navigating through this situation. And we know that extending the timeframe, back to normal operations is inconvenienced a number of our member partners and I want to make sure that the residents and the member partners understand that we appreciate that what we have asked is that the originally identified 23 communities restrict outdoor water use. That certainly has been an inconvenience, we saw a significant operational benefit when when that started to happen immediately. So it allowed the pressures to be higher for the seven communities that were most negatively impacted by this so we appreciate their cooperation. We understand its inconvenience and we hope to be returning this system to normal. The target date that we have been identified as October 5. I hope that we are able to do it sooner. We certainly have all hands on deck and and I can't stress enough how proud I am of the team that has been working on this emergency. This is an unprecedented emergency for us. And the team is just outstanding. We have a very talented and dedicated team of individuals and at some point in time in the near future when we are past this. We certainly want to bring them in front of you and in all congratulate them for their efforts and it's it's varied. Lots of different technical expertise to make this happen. A lot of dedication and our team's teams pretty tired but they're they're gotten it through and they're gonna see it through because that's what they do. So I certainly want to congratulate them on the work they've done so far and and hope that we'll be out of this emergency soon.
So I did write in the report, the excellent news and the band transaction. You heard a lot of that I'm not going to go back over it today. Nikki's team are our financing team, our partners, just an excellent outcome for the organization and I can't thank the team enough for the work that they've done and you saw them here today and we certainly appreciate them. And if you have a chance to thank them personally I would appreciate that. I certainly am doing that because they've done a just an excellent job. So moving on to a four you know with the focus on affordability, our Capital Improvement Planning Team, along with our wastewater and water engineering teams recently completed an extensive review of our capital improvement projects. So we've been talking about this ever since the inflationary increases really hit home. Right. This is not something that's going to happen in the future. It's something that's happening now. And they have spent a tremendous amount of time aligning our capital improvement plan with our financial plan, which is what we do and which is what we need to do to be financially responsible and responsible in the system. The CIP team held multiple water and wastewater what we call alignment sessions. So we put all the projects out there we certainly have a plan that has projects in them and every year there are some more projects that come along and and we have to update you know cost estimates and things like that, but then we take a significant amount of time to do that alignment. And it's not just a one year budget, we do a five year capital improvement plan with a 10 year outlook. We also do the same thing on the financial side. So we have to work through the nuances of all of that. And we have been working through that and some really difficult decisions to prioritize our systems needs have been made. And so I just wanted to let you know that that was going on. I know that we talked about the fact that it was going to happen, I want you to know that it has been happening. And we absolutely are committed to doing the right thing for the region and really threading that needle and how it is that we're going to move forward with our with our capital improvement plan. As you know, the last several years, we have made a concerted effort to build relationships with our state and federal federal legislators to help ensure that we're considered as discussions occur about drinking water and clean water policy. And appropriations. As part of that effort, Bill Wilson, Randall Brown and I recently traveled to Washington DC to meet in person with several of our federal legislators. So we haven't done this before certainly won't be the last time that we did it. Over the course of two JAM PACKED days we met with a total of eight legislators on both sides of the aisle. We discussed a broad range of topics. P FOSS was something we talked with every single legislator about is certainly important and policy and rulemaking as that that important topic moves along through the EPA. We talked about our aging workforce and opportunities for programmatic funding. To address it, because that's something that's that's certainly affecting us all, as well as our ongoing requests for funding for that Army Corps study that you were just talked so much about when NaVi gave his update. So as I said, it was the first time we have done it but won't be the last time it certainly is part of a program. You've heard us talk that we have met with other legislators we had had a government relations program that we stood up and worked through and had dozens of meetings with state legislators earlier in the year. I also made appearance myself and Walter Davis, our Director of Emergency Preparedness presented to the Macomb County Board of Commissioners on September 14. The main purpose of that visit was to share information about how we follow the Incident Command System. The request was, you know, how do you call GL wa How do you coordinate in emergencies with the county? I think it's great question right. So we were able to talk about that. And we were also able to give them a good update on the on the main break. So that was that was very well received. We appreciated that I would tell you that every opportunity I have to talk to our elected officials. I'm taking every opportunity that I have for us to get in the media. I'm taking right I think it's really important that we get who we are out there. People know and understand who we are and when there are things that occur that are emergencies are certainly an opportunity for us to make sure that we we broadly communicate not only what we're doing but who we are and what what we need as a region and what and really the values of JL WA. Since I mentioned workforce development, in conjunction with our our visits to Washington I want to share with you two important updates regarding this subject. First, I'm proud to tell you that a new CT a cohort of EIC T eyes these are electrical instrumentation control technicians with an instrumentation focus that's a title we have
apprentice that there is a new cohort this new cohort is scheduled to launch in January 2023. is in support of this announcement our organizational development group scheduled information sessions with insterested interested candidates beginning the second week of this month. And I think it's important to state this was the first apprenticeship program we stood up and we hired 19 of the 20 people that went through the first cohort. So this is a second cohort and this is certainly a regional need. Next I'm sure you're all aware that there are currently very competitive job markets. We've been talking about that both locally and nationally. And we've experienced certainly challenges in recruiting qualified candidates and hard to fill positions. And I am happy to share with you that we've launched a new program called 123. Come work with me this is the first ever team member referral program. So what we're really doing with this program is encouraging our team members to become in help in recruiting for talent, they know people, right they know people who are looking for jobs, right so what can we do to encourage that really it's the program at its core, allows team members to earn up to $600 for every candidate that comes in and is selected and works with GL wa so this is a program it's just starting. It's part of how do we creatively really turn ourselves into the talent business in addition to the water business because that's what it's going to take for us to get through this tight labor market. There's no doubt about it and our team members are our best folks, people. I mean, they really are so happy to see that's going on stain on the recruitment and retention theme. I'm excited to share with you that we had a new recruitment video that was created by our public affairs team in partnership with organizational development featuring Candice Hudson. This is an link to this as on page 21. And I say this every time and I I really mean it sincerely, you should watch this video. So Candace Hudson she is an exceptional team member. We have lots of them. She works at the northeast water treatment facility and she started at DWSD as an intern while she was still in high school, and now has worked her way through the ranks to become a team leader for us. So she has a great story about how this is a career. Right? This is not just a job. This is a career and it's a career with purpose. And if you really want to contribute to the community, this is a good place to do it. So I encourage you to go take a look at that video. I want to share with you how team members are sharing their knowledge and best practices with other utilities. This is another piece of our employee employee value, improving the employee experience and employee value helping them feel valued. We had a number of team members present at the American Water Works Association Michigan sections annual conference that was just last week or the week before up in Traverse City we had a manager Pete from presented on replacement or rehabilitation in a project related to cast iron sluice gates. We had engineer Victoria Hogue, who presented on our ongoing corrosion control study. You've heard much about that. We had management professional Nicholas Hoffman gave a talk on innovative rehabilitation efforts underway in the raw water 20 tunnel, leading to the northeast water treatment facility. We had management professional Nicole say Jack who presented on proactive stress testing of treatment facilities for harmful algal bloom readiness and COO Cheryl Porter spoke on how GL WA is increasing system resiliency by strengthening relationships, very strong showing as we should as a large utility in the state with our water professionals. So we're so proud of our team, in addition to all that work that we've been talking about that they need to do to keep the system running every day for them to go and represent JL WA and it really educate and work with and in network with other professionals in the state is is exactly who we want to be and where we want to be. So lastly, our apprenticeship program and our one Water Institute were recently featured by EPA as a case study for other utilities. As a result of this feature on September 21. Deirdre Weir, OD training director and Pat Butler od manager presented on these initiatives during EPA recent creating the water workforce of the future webinar. So you've heard an awful lot about what it is that we do in different ways. But these are some really great accolades that tell you that we're not just doing good things here in Michigan, but it's being recognized nationally, and what we're doing for workforce development. So I'm really proud of our team. I can't say that enough. We have a great and talented team and so with that I will be happy to take questions.
I just got a couple of Sue. You know as you know, I sit on this committee with EPA and and I just sent you a voided you a memo that we're making recommendations on retention and and streamlining certifications and recruitment and things some of the things that you're doing so if you take a look at it, and if you think there's some things that we're doing here DL wa that I could put into this letters recommendation, I'd be more than happy to make it I know they're they're looking to fund some of these new initiatives that they could tell around the country. So this might be an opportunity to get some funding. That's number one. Number two, going to Washington as you did is is a great thing to do. I think that if you're planning future trips, it might be a good opportunity to invite somebody from Wayne County, Oakland County, Macomb County, the City of Detroit they all all four entities have relationships there also it might be a way to broaden the base and, and help those entities as well as GL WA. And then finally, it's my understanding that that 120 inch pipe is complete can't be put back in service until the disinfect. Disinfection takes place. That's not going to happen to October 5. I guess one of my concerns is a reversing some of the things that were done in order to get water to the northern region of GL wa as well as to Macomb County. My assumption is those things will have to be reversed. And if there's any, I guess you can't predict unintended consequences but things that the communities that those pipes go through should know and ought to be looking out for. Once the pressure comes back down. I'm assuming that the pressure will come back down. It would be good to know that I had a time and that's what the memo speaks to that I'm sending to resource resource and the Resource Committee to to investigate. So
yeah, so I've got ideas. Miss Porter has very detailed SLP return the system back to its normal operations and is communicating while she's sitting here. And so we certainly take take your take your comments into consideration and we're going to methodically Yeah, carefully
and Thanks for Thanks for all the help that your team has been giving my team and trying to work through some of the issues. We truly do appreciate the collaborative effort that's been formed to try to resolve some of the issues.
Any other comments? Yes, I was gonna just kind of piggyback on on Gary's comment about your trip to Washington. Which I agree with our our lot. Our lobbyists in in Washington
to talk about handles both state and federal lobbying for this utility. And so I assume they're different teams planning for this trip.
We got with them you guys went sort of hand in hand, right? Yep. That's Yes, that's
exactly right.
Yeah. I also agree very much with Jerry's point about it. I don't know. You know, where you go. Whether it's Oakland Macomb, Wayne County or Detroit. But a lot of these relationships are very personal. They go back a long way, both with our Senate delegation, as well as the congressional delegation and these personal relationships when you leave Washington made some requests of the representatives there. And you're hoping that from those requests, some action can actually be taken as opposed to just being sort of a feel good meeting where they took time and they met with you and then you leave and then that's that's the end of it. Having some folks go go and be a part of that delegation, I think can be very helpful sometimes, especially if you're going to target specific lawmakers who are very much involved in some of the things that we need to have done get from the warrior suit perspective. So I think it was great. I don't know who suggested it, but I'm glad you did it. And hopefully you can make it a regular kind of outreach. Yep.
Yeah, that's certainly our intent. Thank you,
and suddenly gonna get it. Alright, so we will look in the future for other opportunities. But as you know, this was get to know us. As an organization,
we do motion to receive and file. So second, all in favor. Hi. Okay, closed session.
Yes, Randall brown general counsel for the Great Lakes Water Authority. There's actually three closed sessions. That I'll just run through really quickly, and it does require complete for all of them a two thirds roll call vote. The first one is a closed session on DWSD versus Highland Park and Joe wa versus Highland Park. This honorable buddy can go into a closed session. If discussing a little litigation or settlement strategy would have a a financial detriment to the authority. I do think having a discussion of this litigation in open session could have that impact and requesting that we go into a closed session to do so. In addition, we have a personnel evaluation, closed session. This honorable body can go into a closed session at the request of an employee to discuss a personnel evaluation in a closed session. We do have a letter from CEO coffee requesting that and that's the reason for going into that closed session. Finally, this honorable body can go into a closed session to discuss materials that are exempt by federal or state law. I have an attorney client communication that I'm requesting that we discussed in a closed session. Again these recall this requires a roll call vote to go into a closed session.
Can I get a motion for closed session on the Highland Park Manor? Move second. Roll call vote please.
Chairperson quadro Z. Yes, Vice Chairperson, Android's director Brown. Yes. Directors. Yes.
Can I get a motion to go into closed session on the personnel evaluation? Tomo report? Roll call vote, please.
Chairperson Quadra? LZ Yes. VICE CHAIRPERSON Hendrix Yes. Director Brown. Yes. Directors that Yes.
And can I get a motion with a third item I'm sorry, Randall health session for the closed session was the attorney client communication attorney client communication. So move second. Roll call vote, please.