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060520 Friday Staff Report „ City Manager's Office 215 E. McKinney St., Denton, TX 76201 • (940) 349-8307 DENTON MEMORANDUM DATE: June 5, 2020 TO: The Honorable Mayor Watts and Council Members FROM: Todd Hileman, City Manager SUBJECT: Friday Staff Report L Council Schedule A. Meetings 1. Public Utilities Board Meeting on Monday, June 8, 2020 at 9:00 a.m. via video/teleconference—City Council Work Session Room. 2. Historic Landmark Commission on Monday, June 8, 2020 at 3:00 p.m. via video/teleconference—City Council Work Session Room. 3. Work Session of the City Council on Tuesday, June 9, 2020 at 1:00 p.m. via video/teleconference—City Council Work Session Room. 4. Cancelled - Mobility Committee Meeting on Tuesday, June 9, 2020 at 9:00 a.m. in the City Council Work Session Room. 5. Cancelled-Agenda Committee Meeting Wednesday, June 10, 2020 at 2:30 p.m. in the City Manager's Conference Room. 6. Hotel Occupancy Tax and Sponsorship Committee on Thursday, May 23, 2020 at 10:00 a.m. via video/teleconference—City Council Work Session Room. II. General Information & Status Update A. Pending Council Requests Work Session Topics — There are NO items scheduled for discussion during the June 9 City Council work session. Staff contact: Stuart Birdseye, City Manager's Office B. COVID-19 Testing at NursingHomes omes—The Denton Fire Department concluded testing in Denton on May 29. 746 total residents and staff were tested at four nursing facilities (both Good Samaritans, The Vintage, and Senior Care) last Thursday and Friday. Results from those tests should be received by the County Health Department and disseminated to the nursing facilities soon. Pilot Point Fire Department also requested the Denton Fire Department assist with testing the Pilot Point Care Center. This testing OUR CORE VALUES Integrity • Fiscal Responsibility • Transparency • Outstanding Customer Service was completed on Tuesday, June 2 to 103 total residents and staff. In all, the Fire Department tested 849 persons in 3 days. Staff will submit the expenses that were incurred for reimbursement. Staff contact: Kenneth Hedges, Fire C. COVID-19 Expense Reimbursement — During the June 2 City Council Meeting, staff received a question regarding the Federal Emergency Management Agency (FEMA) reimbursement submittal timeframe. To be eligible for reimbursement, expenses must be submitted within 60 days of the end of the national disaster declaration, according to the Texas Department of Emergency Management (TDEM). Staff Contact: David Gaines, Finance D. 8 Can't Wait Initiative —On May 25, George Floyd, an unarmed person of color, died while in the custody of officers of the Minneapolis Police department. This death has stirred a national debate for the need to review and improve the equitable and proper use-of-force by public safety entities across the nation. Locally, residents have led and joined in demonstration and protests to express their outrage at the death of George Floyd, expressing their concern that the use-of-force by police on persons of color across the United States has been committed in a discriminatory and disproportionate manner that has resulted in injury or death, and the desire to have such policies and practices of the Denton Police department Reviewed. On June 4, Council Member Armintor forwarded an email from a resident and staff have received other articles regarding the "8 Can't Wait" initiative by Campaign Zero. Campaign Zero examined the use of force policies of 91 of America's 100 largest cities' police departments to identify the policies that establish restrictions on how and when police use force against civilians. Out of that research, the initiative identifies 8 measures to be included in Department policy in the effort to reduce violent encounters between police and citizens. Currently, very few cities in the U.S. have reported adopting all eight measures. The Denton Police Department has very intentionally and deliberately continued to review and update all General Orders (policies) in place prior to 2018. Within these general orders,the Denton Police Department has adopted eight(8)of the measures (see attached) prescribed by Campaign Zero. The ongoing process to refine and improve the all General Orders continues today. To see an updated version of current Denton Police Department General Orders, go to https://www.cityofdenton.com/en-us/all-departments/public-safety//police and click on the link "General Orders (Updated Monthly)" under Documents and Forms. Staff contact: Frank Dixon, Police E. Loop 288 Property Virtual Neighborhood Meeting—On Thursday, June 4 at 6:30 p.m., the City hosted a virtual neighborhood meeting to discuss the proposed zoning change of 909 N Loop 288 from Suburban Corridor(SC)to Public Facilities (PF). Staff shared with the attendees an overview of the proposed zoning change and potential uses being considered for the proposed center. There was a total of 11 attendees that participated in the virtual meeting, some asked questions while others just observed. Questions included: 1) What will the City do to prevent those visiting the center from traveling through my neighborhood?; 2) What are the plans for the area between the center and 2 my neighborhood?; 3) Was there other locations identified for the proposed center?; and 4) How will the City prevent individuals that are living unsheltered from camping near the center in wooded areas or on other properties? Staff responded to all the questions and provided the attendees with a timeline of upcoming public hearings where they can provide their comments and ask additional questions. Staff Contact: Sarah Kuechler and Dani Shaw, Community Services F. Downtown Fence/Wall— Several Council Members have requested information about the temporary fence/wall at 108 N. Locust St. in downtown (former Mini-Mall). This site has remained undeveloped since the fire in December 2017, and the wood wall was put in place as a temporary solution. Since the time of the fire, staff has worked with the property owners to secure the fence when damaged/fallen as a result of severe weather. This week, staff provided several options to the property owners to provide a more permanent solution and remedy the wind damaged wall. Staff will continue to work with the property owners to mitigate the hazard. Staff contact: Scott McDonald, Development Services G. Weekly Unemployment & Business Update — Staff is working to assemble, review, and analyze unemployment and labor data each week. Staff will provide ongoing updates throughout the COVID-19 pandemic as data is made available. • U.S. Department of Labor(DOL) o DOL released its weekly unemployment report on Thursday, June 4. The full report is available here. • Bureau of Labor Statistics (BLS) i. The BLS released the May Employment Situation Summary on Friday, June 5. The full report is available here. • Texas Workforce Commission(TWC) o TWC has created a UI Claimant Dashboard to provide updated graphical representations of data and datasets for download. The dashboard is available here. o April local unemployment data was released on the Texas Labor Market Information(www.texasLMI.com) system on May 22. The next release is scheduled for June 19. o TWC also provides data on weekly unemployment claims filed and how the claim was received. The chart with data as of May 29 is below. • U.S. Census Bureau o The U.S. Census Bureau is conducting experimental Small Business Pulse Surveys to measure the changes in business conditions on small businesses throughout the country. o Data is now available for the week of May 24-30. o The results of the survey are available here. Staff contact: Jessica Rogers, Economic Development 3 Unemployment Claims Filed COVID-19 Unemployment Claims Filed Week Ending Total Internet Telephone Other 2/22 7,053 2/29 7,393 317 6,368 3/14 16,176' 2,731 1,380 1,931 3121 158,364' 141,632 13,678 3,054 3/28 276,185- 256,214 20,642 15.696 414 313,832' 321.000 20,000 20.000 4111 273,567' 221,500 14,800 10.300 4118 280,761• 283,900 21,600 19,600 4/25 254,084• 246,600 25,100 165,600 5/2 247,179• 237,400 28,300 20,200 5/9 141,672' 166,800 30,500 12,900 5116 134,381- 145,400 29,400 21,700 5/23 128,105' 136,600 27,600 20,300 5/30 106,821• 114,000 23,200 25,700 6/6 106,200 63,400 14,200 28,600 Unless indicated,numbers are estimates based on internal TWC data and are subject to revision. 'Official Department of Labor Data when available and TWC Estimates "•Breakdown Data Unavailable H. Utilities Management Study-Denton Utilities are required by the Section 12.08(o of the City Charter to conduct a management study in an interval not to exceed 10 years. The Charter specifies the study shall be conducted by a competent management consulting or industrial engineering firm and that the report and recommendations shall be made public. The purpose of conducting management studies is to provide a thorough examination of major elements of Utilities operations to ensure Utilities are adhering to processes required by the charter and organization, are being managed efficiently, and are cost effective. The last management studies were completed in 2008-2009. On July 24, 2018 the City Council adopted an Ordinance awarding a contract with NewGen Strategies and Solutions, LLC (NewGen) for a Utility Management Study for Electric, Water, and Wastewater. The study was conducted during 2018-2019, and the draft findings were presented to the Public Utility Board on Feb 24, 2020 and the City Council on March 2,2020. The draft report was then completed, although some delays occurred due to the COVID-19 pandemic. The final report is attached. Staff continues to work on initiatives to address the findings and recommendations of the report. Staff contact: Kenneth Banks, Utilities Administration I. Library Internet Access -During the May 19 City Council Meeting, Council Member Armintor requested information about how citizens can access Denton Public Library wi-fi internet outside library facilities. Library staff added information about facility wi-fi range to the library's website on the COVID-19 response page and shared the information on library social media channels on May 20. Denton Public Library also submitted a grant application with the Texas State Library and Archives Commission for the competitive TSLAC CARES Act Grant. The library's request is for funding to expand library wi-fi internet into the parking lots at all three library locations. If funded, community members would be able to access wi- 4 fi 24/7 while parked in library public parking lots. In addition, the library is requesting funding for additional mobile wi-fi hotspots for circulation. Additional mobile wi-fi hotspots would reduce wait times as the library's existing 30 hotspots are so popular and have a continual wait list of 5-15 patrons waiting for hotspot access. If Denton Public Library's application is approved for grant funding, the TSLAC CARES Grant funding would be available in July or August 2020. Library users also now can make appointments to access library computers or bring their own devices to access library wi-fi inside library facilities as part of the library's Phase 2 reopening plan, which started Monday, June 1. The first appointments began Tuesday, June 2. Staff contact: Jennifer Bekker, Library J. Wildflower Patch Mowing—On June 1, Council Member Briggs forwarded a resident concern about a wildflower patch on Sherman Dr. that was mowed over recently. This wildflower area was inadvertently mowed by a new City contractor. Staff contacted the contractor to review the map that was given to them showing the areas that should be mowed. Staff reached out to the resident to attempt to replant some seed now and will help again this fall to try to reinstitute some wildflowers in the future. Additionally, this contractor notified staff that they were not prepared for a workload of this nature and terminated their contract. These parcels will be going out to bid again and will be presented to the Council later this summer for consideration. Staff contact: Gary Packan, Parks and Recreation K. Update on Denton Women's Interracial Fellowship Monument Project — At the January 28 City Council meeting, Council Member Meltzer presented a request for consideration of a monument to the Denton Women's Interracial Fellowship (DWIF). The Council directed the item be reviewed and considered by the Public Art Committee (PAC). The PAC reviewed the item at their March 5 meeting and approved to place the project on their work plan so that they could consider funding for the project later. In May 2020, the Texas Commission on the Arts (TCA) released their applications for the Arts Respond— Cultural District Project grant program. The PAC, as the primary board for the City's cultural district, is eligible to apply for the TCA grant program. Although there are multiple public art projects in the works,the monument to the DWIF was the only current project eligible for submission by the PAC to TCA, so staff worked with the PAC and the Greater Denton Arts Council to develop an application, project budget, and narrative for submission. At the June 4 PAC meeting, the committee recommended approval of the application and requested Council approve a letter of support. A resolution approving the application and the letter of support will be on the June 9 City Council agenda for consideration. Staff contact: Jessica Rogers, Economic Development L. Hinkle Drive Roundabout — On May 19, Council Member Briggs requested that staff assess the lighting at the new roundabout at Hinkle Dr. after a sign had been run over. Staff visited the sight last week and determined short- and long-term solutions to resolve the concern. First, reflective pavement markers have been installed on the inside and outside of the roundabout lanes which will allow a vehicle's headlights to illuminate the roundabout edges when they shine on the reflectors. Long-term, Capital 5 Projects is developing a schedule with DME to install streetlights at this intersection. Staff contact: Brian Jahn, Capital Projects M. Signal Timing — On June 2, Mayor Pro Tem Hudspeth requested that staff assess the signal timing at the intersection of Locust St. and US 77/Elm St. and determine whether a flashing yellow (yield) light would be better suited for this site. Staff looked at the timing and detection of this signal and updated the timing to make it turn green sooner when opposing traffic is not present. Staff does not recommend a flashing yellow arrow for the southbound right-turning movement, as it would create an unsafe condition due to the lane geometry of the intersection. Staff contact: Brian Jahn, Capital Projects N. Upcycling Plastic Buckets—On May 29, Council Member Briggs forwarded a resident suggestion about upcycling plastic five-gallon buckets to be used for distributing DynoDirt or for use at the ReUse Store. Unfortunately, contractual and safety issues prevent the City from attempting to segregate this material from the recycling stream once it is collected. The City contracts with a third party to manage and recycle materials collected from Denton residents and commercial entities. Pursuant to the contract, our process has the exclusive right to manage the recyclable material collected. Because there is revenue involved, it is incumbent upon the City to deliver as much empty, clean, and dry programmatic material as possible. From a safety standpoint, scavenging (the search for and collection of anything usable from discarded waste) of material from within dumpsters or the working face of the landfill is extremely dangerous and contrary to industry best practices. All Landfills have an anti-scavenging policy. The solid waste industry is the fifth most dangerous profession as listed by the Department of Labor based on number of deaths. It is estimated that several people are killed each year at landfills and material recycling facilities due to the removal of objects from discarded material. The safest, and cleanest mechanism, to obtain materials for upcycling is from the generators directly. While some may have a policy that prohibits distribution, many businesses are happy and willing to segregate and distribute buckets and other items at the request of patrons. Upcycling is the reuse of discarded objects or materials in such a way as to create a product of higher quality or value than the original. Moving forward,upcycling will be a component examined as part of the upcoming Solid Waste Management Strategy. Staff contact: Brian Boerner, Solid Waste and Recycling O. Orr Street Repairs—On May 26, Council Member Briggs forwarded a resident concern that Orr Street was sinking near the intersection with Locust. The next day, May 27, a crew from the Streets Department completed a patch on the street, and staff assessed the underground utilities to verify the cause of the pavement failure. Staff used their CCTV camera down the sewer line at the intersection, and found no issues with the pipe, leading staff to believe that the issue was soil settling over the pipe, which is not uncommon for a pipe nearing 20 feet. Staff will continue monitoring the area, but do not anticipate this being a continued issue. Staff contact: Daniel Kremer, Public Works 6 P. Proposed Park Property in Rayzor Ranch East—In April of 2019, Parks and Recreation presented City Council the proposed development of potential park property located in Rayzor Ranch. The 9.86-acre parcel of green space was to be developed and dedicated to the City with both land and improvements. The presented improvements consisted of the linear trail, trees, landscaping, mounding, signage, and lighting. At this time, per the City park land dedication and development ordinance, the development, as proposed,is required to dedicate a minimum of 6.14 acres of park land as well as $311,995 for park development. During the meeting, the City Council provided feedback with potential ideas for the new park. Some of the ideas were integrated, such as spacing for food trucks, wildflower areas, trees, and shaded areas. At this time, some of the suggestions provided by Council will not be in the initial plan due to budgetary restrictions. Suggested ideas from Council include an interactive fountain, elevated stage, and terraced seating. The development group did have several conversations regarding potential opportunities with the Denton Explorium Museum. On November 19, 2019, Allegiance Hillview received a developer agreement for review and feedback. Numerous communications have been sent to the developer requesting feedback on the agreement. Since this date, it has been the desire of Parks and Recreation staff to provide the developer agreement to City Council. Staff intends to present a proposed development agreement as soon as the agreement is finalized. The developer has been working on the construction of the park and has made significant progress. The developer has already installed the grading, drainage, irrigation, sod, landscaping, trees, and the trail. Per estimates provided by Allegiance Hillview, the cost of the park is estimated at over$1,000,000. These construction costs well exceed the amount of required park development fees that the residential projects with Rayzor Ranch East would generate. Any improvement made above this amount is not eligible for any such payment or reimbursement from the City. Additionally, the developer continues to construct the parcel in good faith to provide enjoyable park space for the neighborhood and the City. Staff contact: Gary Packan, Parks and Recreation Q. Atlas Road Repairs—On May 27, Council Member Briggs requested information about the status of street repairs on Atlas Rd. Repairs on this road are anticipated to begin within the next eight months, as the construction on Hercules needs to be complete before beginning on Atlas. Atlas Rd. will be repaired by in-house crews (highlighted in red on the map below) and all other streets in the neighborhood are part of the 2019 Bond package (highlighted in blue). Staff contact: Daniel Kremer, Public Works In-House Construction Schedule • Currently Under Construction: Masch Branch, Kerely • Next on Schedule: Rockwood, Royal, Mistywood, Woodhaven • Awaiting Atmos Clearance: Edgewood Place, Northwood Terrace, Atlas PTUNE D SAVAGE DR JUPITER DR CRUISE ST M AME I R w APOLLO DR DIXON LN O R9 SVA NG OR L) A S DR PER > p � J p NO LN Z Z Z O U w� O D a 0 U-i J J ER LE N Z A O� � MEAD&LN � 4 �r gJrn o � SUN VALLEY DR C Z O RETAMA ST (P O JO J O ZS� U F � IMPERIAL Z �NDBR0 sr 1 'tA OR LAGUNA DR R. Virtual Yankee Doodle Parade—Parks and Recreation is reorganizing the annual event into an online parade video, which will premiere on Facebook on July 4. Anyone who would like to participate is asked to submit a picture or short video/animation (30 seconds or less with no music) of their version of a float. Participants are asked to have fun and be creative. There will be awards for multiple categories, including Most Patriotic Baby,Pet,Vehicle,Yard, and more. All entries must be submitted by June 14. Visit www.dentonparks.com for more information and to register. Staff contact: Keanna Stallings, Parks and Recreation S. Virtual Liberty—The 22nd Annual Liberty Run 5K and 1-Mile Walk is becoming a virtual run this year. Registration is free, or $12 for a T-shirt. Participants should complete their run or walk by July 4. Runners and walkers can share pictures of themselves in festive outfits and be entered to win$25 gift cards. For more information and to register, visit www.cityofdenton.com/virtualreccenter. Staff contact: Jennifer Eusse, Parks and Recreation III. Upcoming Community Events and Meetings A. Events All City-sponsored events and programs are suspended until further notice. B. Community Meetings All City-sponsored meetings are also suspended until further notice. 8 IV. Attachments A. Denton PD 8 Can't Wait Chart .........................................................................10 B. Denton Organizational Assessment...................................................................11 V. Informal Staff Reports A. 2020-055 Riney Road Water Site....................................................................275 B. 2020-056 Forestar-Rayzor and Drury Tract 4..................................................279 C. 2020-057 2019 Water Loss Report..................................................................283 VI. Council Information A. Council Requests for Information ..................................................................306 B. Council Calendar ...........................................................................................307 C. Draft Agenda for June 16................................................................................310 D. Future Work Session Items ............................................................................318 E. Street Construction Report .............................................................................319 9 Denton Police Department " 8 Can't Wait Chart" JDENTOnj lurr�' -nml 1 - 1G Restricts Requires Requires General Requires De- Has Use of Force Requires Warning Shooting At Exhaust All Duty to Comphrehensive Name Order#300 Escalation Continuum Bans Chokeholds Before Shooting Moving Cars Means Prior to Intervene Reporting Response to Resistance Yes(300.3.1) Yes*(300.4.2) Yes(300.4.4) Yes(300.5) Yes(300.5.1) Yes(300.4) Yes(300.2.1) Yes(300.6.1) 10 r,Y t2 1 IIIII 0 REPORTpp Utility Management Study City . Denton, aofI ' 11YJ kgg-"- & Solutions T E X A S ECONOMICS STRATEGY ltTAKEHOLDERS SUSTAINABILITY www.newgenstrategies.net Table of Contents TOPIC PAGE PROJECT OVERVIEW 4 EXECUTIVESUMMARY ................................................................................................................................................................................................................... 7 SURVEY RESULTS 13 UTILITY MANAGEMENT STUDY - KEY FINDINGS & RECOMMENDATIONS Electric 23 Water/ Wastewater 37 Shared Services 53 Communications 55 Finance 64 Infrastructure ............................................................................................................................................................................................................................................................................................................................ 93 People ...................................................................................................................................................................................................................................................................................................................................107 Process 122 Strategy ............................................................................................................................ 126 FRANCHISE & PAYMENT IN LIEU OF TAXES Electric 130 ............................... Water/Wastewater 138 COMPARATIVE ANALYSIS (BENCHMARKING) ........................................................................................................................................... 147 Electric 167 Water 215 Wastewater 233 APPENDICES Appendix A— Persons Interviewed 250 Appendix B — Documents Reviewed 252 Appendix C — Follow-up Survey 12 259 NEWGEN STRATEGIES AND SOLUTIONS, Glossary of Terms A&G Administrative & General IOU Investor-Owned Utility ACM Assistant City Manager KFA Key Focus Areas AE Austin Energy kWh kilowatt hour AMI Automated Metering Infrastructure LUS Lafayette Utility Systems APPA American Public Power Association MAOP Maximum Allowable Operating Pressure AWWA American Water Works Association MG millions of gallons BPUB Brownsville Public Utilities Board NBU New Braunfels Utilities BTU Bryan Texas Utilities NERC North American Electric Reliability Corporation CAFR Comprehensive Annual Financial Reports OPEX Operating Expenses CAPEX Capital Expenditure PILOT Payment in Lieu of Taxes CIP Capital Improvement Plan PMO Project Management Office CMO City Manager's Office PUB Public Utility Board DEC Denton Energy Center PURA Public Utility Regulatory Act DME Denton Municipal Electric REU Redding Electric Utility DRRP Denton Renewable Resource Plan ROI Return on Investment DSCR Debt Service Coverage Ratio RPU Riverside Public Utilities EMO Energy Market Operations SAIDI System Average Interruption Duration Index ERCOT Electric Reliability Council of Texas SAIFI System Average Interruption Frequency Index FCU Fort Collins Utilities SCADA Supervisory Control and Data Acquisition FERC Federal Energy Regulatory Commission SOC System Operations Center FTE Full-Time Employee SPP Southwest Power Pool GEUS Greenville Electric Utility Service TCOS Transmission Cost of Service GFOA Government Finance Officers Association TM PA Texas Municipal Power Agency GFT General Transfer Fund THE Texas Reliability Entity GP&L Garland Power & Light W/WW Water/Wastewater 13 NEWGEN STRATEGIES AND SOLUTIONS, �a s = o. Y... 7 77 O PROJECT OVERVIEW • • - & ProjectObjectives 14 PROJECT OVERVIEW NewGen Strategies & Solutions (NewGen) was retained to perform a Management Study of the City of Denton Utilities (Electric, Water and Wastewater) per City requirements every ten years. The project consisted of review of pertinent documents, interviews with Utility and City staff, CMO and PUB/Council Surveys. NewGen performed an overall Organizational Assessment to review what is working and areas needing improvement in addition to specific review and analysis of the following areas defined in the Scope of Work. NOTE: This Study was conducted utilizing data from 2017 and interviews held in 2018. 15 NEWGEN STRATEGIES AND SOLUTIONS, Scope of Work Governance Review Organizational Structure Review Financial Practices Analysis Development Policies Review Support Services Review Franchise & Payment in Lieu of Taxes Comparison and Impact Analysis Communications Review Public Relations Review Planning Review Budget Process Review — Operations & Capital Budgeting Rate Development & Administration Review Other Significant Issues Effecting Utility Management Identification and Review Significant Operational Cost Components Comparative Analysis 16 NEWGEN STRATEGIES AND SOLUTIONS, • �a s = o. Y... O 17 Executive Summary General Findings The Management Study is performed every ten years to meet a requirement of the City Charter to perform a general management review of the City's utilities. NewGen reviewed the last two reports from 1998 and 2008 and found that the reports, while apparently using the same scope of work tended to focus on certain topics more than provide a "general survey of the utilities" - a holistic view of the organization to identify what is working and what needs improvement. The 1998 report focused on electric utility deregulation and the 2008 report focused on the cost of shared services. The ten year timeframe seems to be too long between studies as much change can take place between studies. Each of the three utilities have had leadership changes. NewGen Recommendations Develop a Scope for future Management Studies that provides a general review of the utilities similar to the holistic organizational assessment approach NewGen performed for this Study. Even if conducted internally, consider performing a Management Study Interim Review every five (5) years tracking progress on the implementation of actionable recommendations from the previous Management Study; this may also provide a fresh general review of the utilities again to identify what is working and what needs improvement. 18 NEWGEN STRATEGIES AND SOLUTIONS, Scorecard AM Ifl.'o A�Z_* Ark 4t COMMUNICATION FINANCE INFRASTRUCTURE PEOPLE PROCESS STRATEGY Formal corporate Solid financial policies Best in class High caliber & well- EMO Center needs Lack of formal communication & procedures facilities trained team better technology strategic planning function Extremely strong Consistent site Lack of a dedicated to more fully process Misunderstanding& liquidity and reserves design standards rates position(s) automate its Monitor rates for process miscommunications position improve p competitive Several vacant (in progress) Community Lack of an Integrated serviceability senior positions position and awareness of DME Resource Plan GIS & Work Order deregulation value is low systems work very pressure Evaluate DEC financial well viability on on-going Substation & basis Distribution Finance reporting has engineering& ops shifted to the CFO processes appear Beneficial TCOS to be well recovery documented Debt service ratio is below Fitch guidelines 19 GOOD ATTENTION WARNING NEWGEN STRATEGIES AND SOLUTIONS, 9 Actionable Priorities — DME CRITICAL SUCCESS FACTOR • RECOMMENDATION a) Hire a GM/Assistant GM that exhibits the following qualities: 1. Hire a General Manager 0 Experience managing an electric utility ✓ INFO ■ Top tier leadership qualities 2. A Utilities rates group is a) Need long term rate plan that contemplates multiple scenarios needed comprised of with impacts from Council decisions such as rate decreases and DME and Finance staff for major capital purchases ✓ ✓ INFO the rates it charges b) Finalize the development of the 10-year financial forecast c) Review rates structure to ensure adequate fixed cost recovery 3. Communicate with a) Review financials,supply contracts,opportunities to improve the stakeholders regarding financial viability of the DEC and develop a short-term and long- INFO term mitigation plan ✓ ✓ ✓ concern over viability of INFO b) Conduct or update an integrated resource planning study Denton Energy Center c) Improve communication with stakeholders regarding the DEC a) Begin a formal stakeholder engagement process that is ongoing 4. Create a formal corporate and comprehensive ✓ INFO communication function b) Document"rules of engagement"that form the basis of governance interaction and authority limits 5. Communicate with staff a) Utility leadership must model the trust inwardly and outwardly INFO to build trust bi- and communicate the why for changes being made in a way that ✓ ✓ directionally is clear and consistent over time 20 INFO STRATEGIESNEWGEN AND • • 10 Scorecard — Water & Wastewater 4qP1 oleo COMMUNICATION FINANCE INFRASTRUCTURE PEOPLE PROCESS STRATEGY Formal corporate Solid financial policies WATER Key positions to be Processes need to Lack of formal communication & procedures Clean & well filled be inventoried and strategic planning function Extremely strong maintained Relatively new in documented process Misunderstanding & liquidity and reserves Appears to be certain Divisions Lack of system or Identify need for miscommunications Strong record of lacking some Bench Strength process automation and acquire source Lack of community communicating appropriate SCADA limits efficiency/ water to meet engagement to changes and ensuring technology Several vital effectiveness future demand educate on rate financial stability positions lackneeded backup Outsourcing/ pressures Finance reporting has contractual options WASTEWATER Organizational underutilized shifted to the CFO Lack of integrated structure needs to (mowing) Capital project technology be more clearly funding/accounting defined getting more focus Issues with cleanliness Debt service ratio is below 2.1 median Fitch One safety concern guidelines for Water 1W 40 21 GOOD ATTENTION WARNING STRATEGIESNEWGEN • • Actionable PrioritiesWater • FACTOR Wastewater CRITICAL SUCCESS • RECOMMENDATION a) Begin a formal stakeholder engagement process that is 1. Create a formal corporate ongoing and comprehensive ✓ ✓ ✓ INFO communication function b) Document"rules of engagement"that form the basis of governance interaction and authority limits 2. Communicate the execution a) Communicate and coordinate system planning methodology ✓ ✓ INFO of capital planning and goals throughout the organization a) Utility leadership must model the trust inwardly and outwardly 3. Communicate with staff to INFO build trust bi-directionally and communicate the why for changes being made in a way ✓ INFO that is clear and consistent over time 4. Develop standard a) Develop procedures and specifications that define the "Denton operations Way" of operating, maintaining the utility infrastructure and ✓ ✓ ✓ INFO procedures/technical technical specifications for any and all equipment to be INFO specifications installed 5. Develop succession plan a) Develop a formal utility wide succession plan working with City V/ ✓ INFO and Utility Human Resources staff a) Need long term rate plan that contemplates multiple scenarios 6. A Utilities rates group is needed comprised of the with impacts from Council decisions such as rate decreases ✓ ✓ ✓ INFO Utilities and Finance staff a and major capital purchases 22 INFO b) Finalize the development of the 10-year financial forecast �WIWAYALWIMWWOVE- - �a s = o. Y... 7 77 O SURVEY RESULTS City Council & Public : • . • 23 PUB and -City Council Survey In January 2019, NewGen surveyed the PUB city council -PUB and City Council. The survey asked, "What is your view of how the Utility is operated? Water Operations Answer choices and the numeric value NewGen assigned to each are below: LXcehent Good Utilities Wastewater Staff Operations Poor/ Needs Improvement Two primary observations emerged from these weighted responses. All Measures Were Better than "Good" Electric Operations The PUB consistently rated each area lower than City Council. MEN Water Operations 4.33 3.33 We recommend the City survey each group Wastewater Operations 4.60 3.67 with the same questions annually or biennially Electric Operations 4.00 3.67 for comparison purposes. Utilities Staff 4.00 3.57 24 NEWGEN STRATEGIES AND SOLUTIONS, What do you believe are the top 3-5 issues facing the City of Denton ? City Council Public Utilities Board • Managing Growth - Planning for Growth Environmental Issues Aging Infrastructure Homelessness Homelessness Affordable Housing Affordable Housing Mobility Downtown parking/streets/traffic 25 NEWGEN STRATEGIES AND SOLUTIONS, What do you believe are the top 3-5 issues facing the City of • City Council Public Utilities Board • Competitive Rates Affordability of services Environmental stewardship Meeting green energy targets Sufficient capacity for Growth affordably Replacement of aging Growth putting strain on ability to Infrastructure serve Better customer service Age of infrastructure ROIofDEC 26 NEWGEN STRATEGIES AND SOLUTIONS, 16 What is your view of how the WATER utility is operated ? City Council Public Utilities Board • Good to Excellent* - Good* to Excellent Impressive, knowledgeable Water quality good, well monitored leadership Improvements to system staying Ability to respond quickly to water ahead of growth leaks Improved communication on water Not many complaints. Effective quality achievements customer service Good balance on improvements Not enough focus on conservation needed vs. rate impacts Costs seem higher for certain Better future planning needed customer classes * Majority view 27 NEWGEN STRATEGIES AND SOLUTIONS, What is your of how the WASTEWATER utility is operated ? City Council Public Utilities Board • Good to Excellent* - Good* to Excellent Impressive, knowledgeable Recognized as leader in leadership wastewater industry Ability to respond quickly to leaks Improvements to system staying without much impact ahead of growth Facilities appear well run Utility is perceived to have no Concern over rate calculations known major issues Few hiccups recently; being proactive with info to the public is beneficial Better future planning needed * Majority view 28 NEWGEN STRATEGIES AND SOLUTIONS, What is your view of how the ELECTRIC utility is operated ? City Council Public Utilities Board • Poor to Good to Excellent* - Good* to Excellent Gas Plant is a huge financial Plan for DEC could have been liability better planned and executed Moving smartly toward 2020 100% Morale seems to be low renewable goal yet competitively Recognized as one of the best priced electric utilities by APPA Deposit policy needs to be Well managed, diversified energy evaluated sources providing low cost power; New management has performed good planning for growth well, transparent vs. closed Being managed with greater approach transparency and efficiency * Majority view 29 NEWGEN STRATEGIES AND SOLUTIONS, 19 What is your view of the UTI LITI ES' STAFF? City Council Public Utilities Board • Good to Excellent Good* to Excellent City Council had an even split of Good people concerned about losing their view of the Utilities' Staff them Staff gives good presentations and Some customer service complaints has been responsive to Board on being friendly but mostly good requests Lineman are very knowledgeable, New DME General Manager has conduct themselves well and have strong financial and operational won awards background; good at conveying complex topics in simple terms Control room staff very good Despite all the changes over last few Deposit policy needs to be years overall experience, evaluated knowledgeable and organized Energy Services group good at managing risk for the utility Hard working with intent to serve citizens of Denton but get caught in politics * Majority view 30 NEWGEN STRATEGIES AND SOLUTIONS, 20 re the top 3-5 items that can be What 1 implemented to improve the City? City Council Public Utilities Board • Continue road reconstruction and - Improve roads, congestion resurfacing Attract businesses to bring better Develop downtown Denton, Parks, paying jobs to Denton mobility and open space master Improve coordination of projects to plan complete in a more timely manner Continue strong management of Streamline/eliminate bureaucracy, fiscal resources empower staff Up to date status on capital Address homeless issue projects i.e. streets for citizens Address homeless issue 31 NEWGEN STRATEGIES AND SOLUTIONS, re the top 3-5 items that can be What 1 implemented to improve the City's Utilities? City Council Public Utilities Board • Plan for long-term water system - Improve the planning and execution needs; wastewater system needs of water and wastewater projects Communication plan for day to day Improve employees morale capital repair projects Ensure proper planning for future Continue to educate public on capacity needs financial commitments and budgets Achieve 100% renewable goal Evaluate rates and deposits affordably Encourage conservation Better communication with residents on projects Address the ROI of DEC 32 NEWGEN STRATEGIES AND SOLUTIONS, I OR UTILITY MANAGEMENT STUDY Denton Municipal Electric Study of DME Denton Municipal Electric (DME) Utility has undergone significant change in the last several years specifically related to: Personnel and process changes The addition of its own generation facilities with the construction of the Denton Electric Center (DEC); and Some trust and credibility concerns. NewGen's scope did not include an evaluation of the changes themselves, but the Management Study does evaluate the effect of these changes and the state of the Utility overall. The Utility has experienced changes in governance and senior leadership. DME continues to work through a "re-setting" stage. With clear direction from City Council and CMO, DME is redefining the "Denton Way" with its own new leadership, processes and sharing of services with the City. 34 NEWGEN STRATEGIES AND SOLUTIONS, Study of Overall, based on the documents reviewed, interviews conducted with DME and City staff, CMO, Council/PUB surveys, NewGen believes DME is operationally very well run and we did not find any "red flags" requiring immediate attention. NewGen has several findings and recommendations concerning the ongoing operation of DME which are summarized in the Executive Summary and detailed throughout the report. 35 NEWGEN STRATEGIES AND SOLUTIONS, What's Working at DME • Good training programs available for employees Cost savings after ERCOT settlement setup INFRASTRUCTUREDEC is running well and operated by a good team Robust ability to handle load growth ORGANIZATION One of the better organizations to work for-good people concerned about the customers • ' Good people/team capable of doing excellent work Apprenticeship Program PROCESS / CITY Working with Finance to setup ERCOT settlement process/ accounts RELIABILITY Electricity Reliability and Compliance is Good (NERC certified). COMPLIANCEDME has experienced very high levels of reliability and even on sustained significant 20 MW peak jump in the last year. The 2018 SAIDI/SAIFI ratings were good to excellent. TECHNOLOGYBest-in-class tools and technology provide protection for the system and building blocks for design and construction NEWGEN STRATEGIES AND SOLUTIONS, 26 I OR Vic, ti $ � 1,1311 "1 Jill ►'1�l Key Findings & Recommendations Denton Municipal Electric Key Issues & Recommendations Key Issue Description 1— Recommendation CEM Recommend monthly meetings with each City department the Utilities interface with to discuss the list Need to improve communication with other of outstanding items and action items for each until the Communication INFO City departments. next meeting. Once better communication is established may be able to move to bi-monthly or quarterly meetings. Formal corporate Begin a formal stakeholder engagement process that is Communication to external stakeholders has ongoing and comprehensive. � communication INFO function led to misunderstandings. Document rules of engagement that form the basis of governance interaction and authority limits. Silos/Need for Suggest internal departmental head/ manager meetings • Improved Silos exist between parts of DME internally. bi-weekly or monthly to increase collaboration and INFO INFO Coordination coordination across all levels of DME. Some of the issues may be simply personality Issues between There seems to be a disconnect between differences but suggest engineers spend more time in a Engineering and Engineering and Operations overall which is formalized field training program and operations staff INFO affecting the efficiency and coordination of work with engineering on completing O&M procedures; INFO Operations these two groups of DME. look at potential team building activities as well to improve relations. 38 Key Issues & Recommendations Keyllssue Description - • • • More Info Communication to external stakeholders has led a) Begin a formal stakeholder engagement process that is Lack of formal to misunderstanding and miscommunication ongoing and comprehensive. corporate regarding DME strategies and objectives INFO communication negatively impacting DME's reputation within b) Document "rules of engagement"that form the basis of function the community and its relationship with the governance interaction and authority limits. City. • • Concerns about council members either a) All requests from Council to utility or city staff needs to Governance Issues contacting staff members directly for go through the City Manager's office. INFO information or work to be performed. 39 NEWGEN STRATEGIES AND SOLUTIONS, 29 Key Issues & Recommendations • • Key Issue Description - • • • More • a) Review financials, supply contracts, opportunities to Concern over There continues to be stakeholder concern improve the financial viability of the DEC and develop a viability of short-term and long-term mitigation plan. INFO regarding long term financial viability of the Denton Energy DEC. b) Conduct or update a supply optimization study. INFO Center c) Communicate the results of the supply optimization study to stakeholders. A Utilities rates group is needed comprised of a) Finalize the development of the 10-year financial DME and Finance staff. It is our forecast including capability to run multiple scenarios Form Utilities understanding from staff that this is in and analyze rate impact rates group progress. The Energy Cost Adjustment(ECA) is b) Review rates structure to ensure adequate fixed cost INFO not currently being used as a true tracker of recovery fuel/energy costs. c) Decide as a body what the policy regarding ECA will be going forward. • The Utilities Financial Strategies document a) Although we understand the Utilities Financial Long-term reviewed suggest an annual 20-year pro forma Strategies document suggests a 20-year pro forma to be INFO forecasting be completed, but NewGen was unable to completed, at this time of market volatility we see no identify or review any 20-year financial plans. benefit of forecasting beyond 10 years. While DME meets GFOA guidelines, reserve Working capital targets may need to be increased to allow for a) Evaluate the need to increase target reserves. for Enterprise larger shifts in energy pricing, especially if b) Consider updating policies to address the DEC debt INFO Funds hedging strategies will involve any long payments similar to its TMPA debt reduction strategy. positions. DME has adequately planned for load growth a) Communicate and coordinate system planning Capital planning and has focused intently on planning for 40 INFO reliability in recent years. methodology and goals throughout the organization Key Issues & Recommendations • • Click for Description - • • • DME has adequately planned for load growth a) Communicate and coordinate system planning Capital planning and has focused intently on planning for methodology and goals throughout the organization INFO reliability in recent years. a) Review financials, supply contracts, opportunities to improve the financial viability of the DEC and develop a Concern over There continues to be stakeholder concern short-term and long-term mitigation plan. viability of Denton regarding long term financial viability of the INFO Energy Center DEC. b) Conduct or update an integrated resource planning study. INFO c) Communicate the results of the integrated resource planning study to stakeholders. Debt service Fitch uses guidelines to assign debt ratings in INFO coverage is below order for the Utilities to improve debt ratings a Consider changing INFO g they will need to improve debt service ) g� g policy to match Fitch guidelines INFO Fitch median of 2.1 coverage. INFO 41 NEWGEN STRATEGIES AND SOLUTIONS, Key Issues & Recommendations • • Click for Description - • • • Utility leadership must help the organization continue At the time of the survey, staff morale was low to move to a better future by establishing clear goals presumably due to changes and negative and objectives. Increase communication from DME Senior Management Morale perception of DME. However, recent INFO conversations with staff indicate that morale to all levels of the organization. Small groups or one-on-one communication in effort has improved. to qualm the uncertainty and repudiate the notion that everyone is on probation. Succession Planning is not formalized at the Succession Develop a formal utility wide succession plan working INFO Planning utility level and largely left up to each with City and Utility Human Resources staff. manager to figure out and keep up with. • • Turnover/ resource At the time of the survey, a number of Evaluate need for open positions and set timetable to eliminate or fill if needed. Suggest an overall FTE INFO allocation/ positions were open in the organization. analysis of the organization (in progress). acquisition Leadership should meet one-on-one and with Resistance to At the time of the survey the organization was departments to explain the overall strategic plan once INFO change struggling with change. developed and routinely to help staff understand changes facing the organization. - 42 NEWGEN STRATEGIES AND • • Key Issues & Recommendations • • Description - • • • The lack of trust is bi-directional and is outward a) Utility leadership must model the trust inwardly and Lack of trust looking in (other city departments, Council, outwardly and communicate the why for changes being INFO CMO) and inward looking out from DME made in a way that is clear and consistent over time. towards the same groups. Morale is low amongst staff due to changes and Utility leadership must help the organization "right itself' Morale negative perception of DME in last few years. and move on to a better future by establishing clear goals INFO and objectives. Some of the issues may be simply personality differences Issues between There seems to be a disconnect between but suggest engineers spend more time in a formalized Engineering and Engineering and Operations overall which is field training program and operations staff work with INFO affecting the efficiency and coordination of engineering on completing O&M procedures; look at INFO Operations these two groups of DME. potential team building activities as well to improve relations. Silos/Need for Suggest internal departmental head/ manager meetings INFO Improved Silos exist between parts of DME internally. bi-weekly or monthly to increase collaboration and INFO Coordination coordination across all levels of DME. _ 43 NEWGEN STRATEGIES AND SOLUTIONS, Key Issues & Recommendations • • Click for Description - • • • Need for better communication with other City a) Recommend monthly meetings with each City departments especially with the advent of more department the Utilities interface with to discuss the list Lack of of outstanding items and action items for each until the communication services being moved from the utility to City next meeting. Once better communication is established INFO departments i.e. IT, Procurement, may be able to move to bi-monthly or quarterly Transportation, etc. meetings. • Succession Planning is not formalized at the Lack of Succession a) Develop a formal utility wide succession plan working utility level and largely left up to each manager INFO Planning to figure out and keep up with. with City and Utility Human Resources staff. Turnover/ resource Turnover is up and a number of positions are a) Evaluate need for open positions and set timetable to allocation/ open in the organization that have not been eliminate or fill if needed. Suggest an overall FTE analysis INFO acquisition filled. of the organization. Overall the organization is struggling with a) Leadership should meet one-on-one and with Resistance to departments to explain the overall strategic plan once change change and not accepting either changes that developed and routinely to help staff understand changes INFO have occurred or are to come. facing the organization. 44 NEWGEN STRATEGIES AND SOLUTIONS, Key Issues & Recommendations (cont9d) Description Recommendation Click for More Info Procedures and Technical Specifications Procedures and technical specifications exist a) Review existing procedures and technical specifications need to be in various degrees of completeness focused on and assign owners to complete for operations and • new construction primarily and are not found completed, staff maintenance as well as new construction at direction of INFO trained and in one comprehensive manual. General Manager; once complete train employees and published to all ensure accessibility to procedures by all staff. parts of DME a) Recommend DME go through an externally facilitated strategic planning process to develop a roadmap for Lack of Strategic Continual need for strong leadership, better utility operations for the next 3-5 years followed by Planning/Overall communication and utility level strategic and monthly meetings to ensure the plan is being INFO Planning operational planning. implemented across the organization. b) Recommend performing formal Strategic Planning process at least every 5 years. 45 NEWGEN STRATEGIES AND SOLUTIONS, Key Issues & Recommendations (cont9d) Click for Keyllssue Description - • • • Procedures and Technical a) Review existing procedures and technical specifications Specifications need Procedures and technical specifications exist in and assign owners to complete for operations and various degrees of completeness focused on to be completed, new construction primarily and are not found in maintenance as well as new construction at direction of INFO staff trained and General Manager; once complete train employees and published to all one comprehensive manual. ensure accessibility to procedures by all staff. parts of DME a) Recommend DME go through an externally facilitated strategic planning process to develop a roadmap for Lack of Strategic Overall need for strong leadership, better utility operations for the next 3-5 years followed by communication and utility level strategic and monthly meetings to ensure the plan is being Planning/Overall INFO Planning operational planning so staff knows the plan implemented across the organization. • before taking action. b) Recommend performing formal Strategic Planning process at least every 5 years. 46 NEWGEN STRATEGIES AND SOLUTIONS, 36 - - 7;�-,mvv"�(, low UTILITY MANAGEMENT STUDY Denton Water and Wastewater Utilities Study of Water & Wastewater Utilities Denton Water and Wastewater utilities have undergone significant change in the last several years specifically related to: Personnel, organizational structure and process changes Lack of execution with respect to capital planning Large amounts of capital set aside for projects that have not been started or completed has created trust and credibility concerns NewGen's scope did not include an evaluation of the changes themselves, but the Management Study does evaluate the effect of these changes and the state of the Utilities overall. The Utilities have experienced changes in governance and senior leadership. The Utilities working through a "re-setting" stage. With clear direction from City Council and CMO leadership, the Utilities are redefining the "Denton Way" with its own new leadership, processes and sharing of services with the City. 48 NEWGEN STRATEGIES AND SOLUTIONS, Study of Water & Wastewater Utilities • • Overall, based on the documents reviewed, interviews conducted with the utilities and City staff, CMO, Council/PUB surveys, NewGen believes the water and wastewater utilities are operationally sound and we did not find any "red flags" requiring immediate attention to address. NewGen has several findings and recommendations concerning the ongoing operation of the utilities which are summarized in the Executive Summary and detailed throughout the body of the report. 49 NEWGEN STRATEGIES AND SOLUTIONS, 39 What's Working at Water & Wastewater ORGANIZATION Good place to work Loyal staff ' • ' Good people who enjoy working here • Development of Project Management Office (PMO) More data driven focus INFRASTRUCTURE Limited wastewater spills Award-winning drinking water quality 50 NEWGEN STRATEGIES AND SOLUTIONS, 40 - - M- V , how Key Findings & Recommendations Denton Water and Wastewater Utilities Key Issues & Recommendations Click for Description - • • • Formal corporate a) Begin a formal stakeholder engagement process that is Improve communication to external ongoing and comprehensive communication INFO function stakeholders b) Document "rules of engagement"that form the basis of governance interaction and authority limits • • a) Recommend monthly meetings with each City department the Utilities interface with to discuss the list Improve communication with other City of outstanding items and action items for each until the Communication INFO departments. next meeting. Once better communication is established may be able to move to bi-monthly or • quarterly meetings. Execution of The Utilities have adequately planned for a) Communicate and coordinate system planning capital planning growth and has focused intently on planning methodology and goals throughout the organization INFO for reliability in recent years. 52 Key Issues & Recommendations Click for Description - • • • Communication to external stakeholders has led Lack of formal to misunderstanding and miscommunication corporate regarding the Utilities' strategies and objectives a) Begin a formal stakeholder engagement process that is INFO communication negatively impacting the Utilities' reputation ongoing and comprehensive. function within the community and its relationship with the City. • Several complaints of council members either a) All requests from Council to utility or city staff needs to Governance Issues contacting staff members directly for INFO information or work to be performed. go through the City Manager's office. • Web Site—Water needs to tell the story better. a) Create a "Trophy Room" for achievements Could not easily locate the miles of water b) Add easily understood facts for utilities Public Relations system or source water on City's page c) Improve capital project education using information, INFO system metrics, and measures that demonstrate the need Capital Project Education for capital projects and how these projects are improving the system 53 Key Issues & Recommendations • • Click for Description - • • . • Better project definition and project Not spending a) Outcome of a formalized capital planning process is a capital set aside management needed to ensure only capital is list of projects needed for the next 3-5 years with spend INFO for projects set aside as needed for needed infrastructure by year (in process). projects. The Utilities Financial Strategies document a) Consider creating a 20-year forecast to comply with the Long-term reviewed suggest an annual 20-year pro forma City's policy and consider long-term rate strategies. INFO forecasting be completed. NewGen was unable to identify b) Update financial forecast tools and long-term rate or review any 20-year financial plans. strategies. While the Utilities meet GFOA guidelines, Working capital given its substantial capital cash funding for a) Consider reviewing how restricted and unrestricted targets for capital repair and replacements, restricted and working capital are allocated to ensure balances are not INFO Enterprise Funds unrestricted working capital should be clearly improperly committed to future capital spending. delineated. 54 X'lime • 611 Key Issues & Recommendations • • Description 1� More Info The Utilities have adequately planned for INFO Execution of capital a) Communicate and coordinate system planning planning growth and has focused intently on planning for methodology and goals throughout the organization INFO reliability in recent years. INFO Improve project definition and project a) Outcome of a formalized capital planning process is a list Improve timeliness management to ensure capital requirements of projects needed for the next 3-5 years with spend by INFO of capital spending reflect needed infrastructure projects within planning horizon. year. a) Training should be provided on the use of the financial Lack of long-term The long-term financial forecast tool available forecast modeling tools. INFO planning to the Utilities is not utilized. b) Update financial forecast tools and long-term rate strategies. Debt service Fitch uses guidelines to assign debt ratings in INFO below coverage order for the Utilities to improve debt ratings a) changing Consider chan INFO g they will need to improve debt service g policy to match Fitch guidelines INFO Fitch median of 2.1 coverage. INFO 55 NEWGEN STRATEGIES AND SOLUTIONS, Key Issues & Recommendations • • Click for Description While the Utilities meet GFOA guidelines, given its substantial capital cash funding for capital Working capital repair and replacements, restricted and a) Consider reviewing how restricted and unrestricted targets for unrestricted working capital should be clearly working capital are allocated to ensure balances are not INFO Enterprise Funds delineated to ensure no balances used to meet improperly committed to future capital spending. targets are committed for future capital spending. The Utilities Financial Strategies document a) Consider creating a 20-year forecast to comply with the Long-term reviewed suggest an annual 20-year pro forma forecasting be completed, but NewGen was unable to City's policy and consider long-term rate strategies. INFO b) Update financial tools and long-term rate strategies. identify or review any 20-year financial plans. The Utilities made efforts to save money through use of internal crews for capital Service delivery projects. When project scheduling and internal a) Consider further supplementation of internal crews to INFO backlog staff capacity allows, this has benefited City rate complete projects. payers. However, project timelines have suffered and/or projects are not completed. a) Need long-term rate plan that contemplates multiple Form a Utilities rates group comprised of scenarios with impacts from Council decisions such as Utilities rates group Utilities and Finance staff. rate decreases and major capital purchases. INFO b) Finalize the development of the 10-year financial forecast 56 NEWGEN STRATEGIES AND SOLUTIONS, 46 Key Issues & Recommendations • • or Description - • • • More Info Succession Succession Planning is not formalized at the a) Develop a formal utility wide succession plan working INFO Planning utility level with City and Utility Human Resources staff. Silos exist between water and wastewater and internally in each utility. Departments need to a) Re-instate departmental head manager meetings bi- work together better to ensure better Silos/Need for operations and reliability of services. Open weekly or monthly to increase collaboration and Improved coordination. INFO communication is needed between the water Coordination b) Institute cross training sessions "lunch and learn" to and wastewater utilities and internally within educate departments on what each other does. each utility i.e. plant personnel and distribution system personnel Need training a) Review any existing training activities and develop program geared With senior staff leaving, more formal training formal training program for all water and wastewater towards Water is needed to ensure there is no drop-off in staff pertinent to their job and the W/WW operations, INFO and Wastewater staff's ability to operate, maintain and manage maintenance and management principles overall. INFO Utility operations utilities. Fulfillment maybe through associations including and management AWWA or local Texas water/wastewater associations. Resource At the time of the survey, a number of a) Evaluate need for open positions and set timetable to allocation/ eliminate or fill if needed. Suggest an FTE analysis of the INFO acquisition positions were open in the organization. organization be performed. a) Leadership should meet one-on-one and with Resistance to At the time of the survey, the organization was departments to explain the overall strategic plan once INFO change struggling with change. developed and routinely to help staff understand 57 changes facing the organization (in process). Key Issues & Recommendations • • Click for Description - • • • The lack of trust is bi-directional and is outward a) Utility leadership must model the trust inwardly and Lack of trust looking in (other city departments, Council, outwardly and communicate the why for changes being INFO CMO) and inward looking out from the Utilities made in a way that is clear and consistent over time. towards the same groups. Silos exist between water and wastewater and internally in each utility. Departments need to a) Re-instate departmental head manager meetings bi- Silos/Need for work together better to ensure better weekly or monthly to increase collaboration and Improved operations and reliability of services. Open coordination. INFO communication is needed between the water Coordination and wastewater utilities and internally within b) Institute cross training sessions "lunch and learn" to • each utility i.e. plant personnel and distribution educate departments on what each other does. system personnel Need for better communication with other City a) Recommend monthly meetings with each City departments especially with the advent of more department the Utilities interface with to discuss the list Lack of services being moved from the utility to City of outstanding items and action items for each until the INFO communication next meeting. Once better communication is established departments i.e. IT, Procurement, may be able to move to bi-monthly or quarterly Transportation, etc. meetings. 58 NEWGEN STRATEGIES AND SOLUTIONS, 48 Key Issues & Recommendations (cont9d) Keylssue Description - • • • More Info Resource A number of positions are open in the Evaluate need for open positions and set timetable to allocation/ organization that have not been filled. eliminate or fill if needed. Suggest an FTE analysis of the INFO acquisition organization be performed. Overall the organization is struggling with Leadership should meet one-on-one and with Resistance to departments to explain the overall strategic plan once INFO � change change and not accepting either changes that developed and routinely to help staff understand changes INFO have occurred or are to come. facing the organization. • Need training Review any existing training activities and develop formal program geared With changeover in senior staff leaving, more training program for all water and wastewater staff towards Water and formal training is needed to ensure there is no pertinent to theirjob and the W/WW operations, INFO Wastewater Utility drop-off in staff's ability to operate, maintain maintenance and management principles overall. operations and and manage utilities. Fulfillment maybe through associations including AWWA management or local Texas water/wastewater associations. - 59 NEWGEN STRATEGIES AND SOLUTIONS, 49 Key Issues & Recommendations • • Key Issue IL- & iL- More Info Description - • • • Standard The Utilities need more formalized operations Develop procedures and specifications that define the operations procedures and technical specifications for "Denton Way" of operating, maintaining the utility procedures/ infrastructure to reduce reliance on the INFO technical knowledge of key individuals for such infrastructure and technical specifications for any and all equipment to be installed. specifications information. Need overall system SCADA map at each water plant Unnecessary pressure management decisions may cause and in main office which shows water plants and T&D emergency work undue stress on pipes. Pay system is not setup system network with system pressures and due to improper INFO appropriately for crews working days on end maintenance identified. Need to consider and resolve system to fix leaks. call in pay issues for emergency work through policy operations. revision or review for staff understanding. • Largely system planning is performed by the directors and outside engineering firms and We understand Denton has hired one individual to lead while there are some notable items that have up system planning and asset management group and is Lacking long term been developed i.e. Wastewater asset developing a team to perform system planning and management, fundamental day to day system modeling. Denton should also bring in experienced INFO system planning planning and modeling needs should have a consultants different from the same ones involved with more critical role in planning to ensure the Directors now to advise on critical issues in the next reliability, efficient operations, and improved 1-3 years. capital planning. 60 NEWGEN STRATEGIES AND • • 50 Key Issues & Recommendations • • DescriptionKey Issue More Info Lack of standard The Utilities did not appear to have formalized a) Develop procedures and specifications that define the operations procedures nor technical operations specifications for items being installed in the "Denton Way" of operating, maintaining the utility INFO infrastructure infrastructure and technical specifications for any and all al specifications but rely on knowledge of key equipment to be installed. individuals for such information. Unnecessary Water leaks due to mismanagement of system a) Need one overall system map at each water plant and in emergency work putting too much stress on pipes which are main office which shows water plants and distribution INFO due to improper cracking. Pay system is not setup appropriately system network with MAOP system pressures identified. system operations. for crews working days on end to fix leaks. Need to resolve pay issue for emergency work. • Largely system planning is performed by the a) We understand Denton has hired one individual to lead general managers and outside engineering firms up system planning and asset management group and is and while there are some notable items that developing a team to perform system planning and Lacking long term have been developed i.e. Wastewater asset modeling removing these duties from the general management,fundamental day to day system INFO system planning planning and modeling needs to have a more managers. Denton should also bring in experienced critical role to ensure reliability of the system, consultants different from the same ones involved with correct operations of the system and proper the GMs now to advise on the best path practically forward to mitigate critical issues in the next 1-3 years. capital planning. 61 NEWGEN STRATEGIES AND SOLUTIONS, Key Issues & Recommendations • • Description Rec• • • More Info a) Recommend the Utilities go through an externally facilitated strategic planning process to develop a Overall need for strong leadership, better roadma for utility operations for the next 3-5 ears Strategic p Y p Y communication and utility level strategic and followed b month) meetings to ensure the Ian is Planning/Overall Y Y g p INFO Planning operational planning so staff is fully informed being implemented across the organization. of the plan before taking action. b) Recommend performing formal Strategic Planning process at least every 5 years. The Utilities are operated very manually. There are numerous areas where technology could improve efficiency, data storage and a) Develop a Technology Roadmap for each Utility • Technology could access, and operations overall. No Technology including key stakeholders and IT staff to identify Roadmap currently exists and items to be • play a bigger role evaluated include: One System Control Room technology needs, priorities,timeframes and costs for INFO in the operations the next 3-5 years as a starting place; execute of the Utilities. Map linked to SCADA systems, AMR/AMI, Technology projects by priority once Roadmap is Automation Meter shop automation and complete and agreed upon. more comprehensive GIS/Asset Management Data to support system operations, planning and modeling, etc. 62 NEWGEN STRATEGIES AND SOLUTIONS, �a s = o. Y... 7 77 O SharedKey Findings & Recommendations Services 63 Key Issues & Recommendations Click for Key Issue Description - • • • a) Evaluate new Purchasing procedures for efficiencies and Delays in New purchasing procedures, some resistance to change, overworked Purchasing staff are improvements, whether additional training is needed for Purchasing Goods users and need for short-term purchasing staff INFO and Services causing some delays in purchasing goods and augmentation to get tasks completed to shave delays in services. purchasing processes. • • Fixed asset accounting problems stem from INFO • Fixed Asset general project management deficiencies in a) Review new capital projects and project management INFO planning and closing projects, and improper procedures instituted by the PMO office to see if they INFO Accounting record-keeping can significantly affect rate address these issues. INFO options. INFO INFO Concern over the Rate changes have been made recently by the INFO impact of rate City without reviewing the long-term financial a) Review and model the CAPEX and OPEX needs of the INFO changes to long- Utilities over the next 5-10 years to evaluate financial INFO term viability of forecast of the Utilities, which may affect the needs and impact to rates. INFO the Utilities. financial sustainability of the organization. INFO INFO A Utilities rates group is needed Need long term rate plan that contemplates a) Finalize the development of the 10-year financial comprised of the multiple scenarios with impacts from Council forecast. INFO INFO Utilities and decisions such as rate decreases and major b) Review rates structure to ensure adequate fixed cost INFO Finance staff for capital purchases recovery. the rates it charges 64 NEWGEN STRATEGIES . SOLUTIONS, �a s = o. Y... 7 77 O COMMUNICATIONS 65 BACK Common Thread While the Utilities are well run operationally, the areas that need improvement have one common thread. There is a lack of a formal corporate communication function which has led to misunderstanding and miscommunication regarding the Utilities' strategies and objectives that have negatively impacted the Utilities' reputation within the community and its relationship with the City. The perceived lack of transparency regarding the DEC created a lack of trust and credibility of DME with the Council and the CMO's office. The public's negative perception of the Utilities has impacted morale. 66 NEWGEN STRATEGIES AND SOLUTIONS, 56 BACK Common Th ' . • • • Silos exist Within DME (namely operations and engineering) due, in large part, to the lack of communication and coordination affecting overall efficiency of these functional areas. Between and within the Water and Wastewater Utilities due, in large part, to the lack of communication and coordination creating redundancies between the Utilities. Need for better communication with other City departments, especially with more services moving to the City, such as IT and Procurement. Overall need for strong leadership throughout the organization, better communication and utility level strategic and operational planning so staff knows the plan before needing to take action. 67 NEWGEN STRATEGIES AND SOLUTIONS, BACK Governance Several complaints of council members either contacting staff members directly for information or work to be performed . Governance policies are not separate but listed under the roles and powers of each entity involved i .e. City Council , Public Utilities Board , City Manager etc. Governance policies do not specifically spell out rules of engagement and/or communications or directives allowed between parts of City government i .e. Council , PUB, CMO's office, City staff. Recommend documenting "rules of engagement" that form the basis of governance interaction and authority limits i .e. Council , PUB cannot direct staff but must funnel all request through the CMO. 68 NEWGEN STRATEGIES AND SOLUTIONS, Governance • • City Manager has instituted rules of engagement to funnel all requests from Council , PUB through one City staff person (chief of staff) vs. Council , PUB members going to staff directly. Large amount of data requests by Council and PUB taking City staff time and attention away from daily priorities. Governance policies and rules of engagement should focus on keeping entities in their respective "swim lanes" i .e. Council , PUB-setting policy and review expenditures and CMO and staff executing those policies with sustainable strategic and tactical plans that survive regardless of changeover in Council and PUB membership. 69 NEWGEN STRATEGIES AND SOLUTIONS, 59 �a s = o. Y... O 70 Public Education and Advertorials Web Site Water needs to tell the story better Could not locate miles of water system or source water easily on City's page Capital Project Education 2019 Construction Guide Looks Great, but focuses primarily on road-driven CIP Video of Project Types , with timing and customer impacts BACK Public Relations Recommendations Create ® Illla�� • . ' • • • Achievements III ��I111I Superior Drinking WaterBest L • Water at Texas Water ,! National if ranked Wastewater Collection System Asset Jy Management Program Water • Association of Texas Sidney L. Allison • 72 NEWGEN STRATEGIES AND SOLUTIONS, LLC 62 Trophy APPA LEED ;aTON kEXCELLENCEINERTIFIED M U N I C I P A L LIABILITY CITY ELECTRIC 3 TIME SUPERIOR ASTEWATER BEST PUBLIC k DNEY L 4"It'llomm TASTING WATER DENTON WATER SYSTEM LISON WARDWARD WATER AND WASTEWATER 73 �a s = o. Y... O 74 I OR Financial Practices Denton Municipal Electric BACK Financial Practices DME needs to review the financial viability of the DEC with a view on the potential revenues needed to offset the increasing debt burden in 2019. The DEC has been a lightning rod for public discussion and consternation in the community It is a state of the art power plant but appears to be overbuilt and therefore more expensive for DME and Denton power needs Concern of the impact of rate changes to long-term viability of the Utility Suggest need for a Utility Rates group comprised of DME and Finance staff working together to assess financial needs of the organization and impact to rates • Transmission Cost of Service has a very healthy return at 28% 76 NEWGEN STRATEGIES AND SOLUTIONS, 66 Financial Annual Financial Strategies Review and Documented Path Forward Denton has done a good job reviewing financial policies annually for DME as well as Water and Wastewater Funds The utilities' Financial Strategies and Practices were compared to the best practices promulgated by the Government Finance Officers Association (GFOA) NOTES: Key policies in this section are identified in "quotes" Adherence to these policies is noted in BLACK font Comments and recommendations are annotated in RED font 77 NEWGEN STRATEGIES AND SOLUTIONS, BACK GFOA Best Practice Comparison Area: Working Capital Targets for Enterprise Funds (Policy date February 2011 ) "GFOA recommends that local governments adopt a target amount of working capital to maintain in each of their enterprise funds. Ideally, targets would be formally described in a financial policy and/or financial plan." DME meets this guidance. Reserve Working Capital 8% Operating Reserves 8-12% Operating Days 60-75 Days DME may need to consider increasing the reserve targets to allow for larger shifts in energy pricing, especially if hedging strategies will involve any long positions. DME may need to consider updating its policies to address the DEC debt payments similar to its TMPA debt reduction strategy 78 NEWGEN STRATEGIES AND SOLUTIONS, 68 BACK GFOA Best Practice Comparison (cont'd) Area: Establishing Government Charges and Fees (Policy date February 2014) • DME uses a 1 .25 debt service coverage ratio in setting rates This is a good policy and helps ensure bond payments adequately covered. Per policy, this may be supplemented by operating reserve funds to meet 1 .25 While City policy allows for this use of reserves, DME should be cautious in its application as some bond pledges may specifically prohibit use of reserves. DME meets this best practice guidance, with only the one exception below: — "Utilize long-term forecasting. . . If the charges will recover costs associated with other long-term plans, such as a multi-year capital plan, a longer-term service fee plan should be consistent, recognizing the plan may be amended to reflect changing conditions in the future." The Utilities Financial Strategies document reviewed by NewGen suggested an annual 20-year pro forma be completed, but NewGen was unable to identify or review any 20- year financial plans for DME. If not already created, this should be done to comply with the City's policy and to consider long-term rate strategies. 79 NEWGEN STRATEGIES AND SOLUTIONS, 69 BACK GFOA Best Practice Comparison (cont'd) Area: Capital Planning Policies (Policy date September 2013) • DME meets this guidance, with the few exceptions below: "To create a sustainable capital plan, the finance officer and other participants in the capital planning process need to consider all capital needs as a whole, assess fiscal capacity, plan for debt issuance, and understand impact on reserves and operating budgets, all within a given planning timeframe." Until recently, the Denton Finance Department has had limited involvement and project accounting for capital planning has been challenging. While this is being corrected, NewGen believes this historical disconnect between City finance and DME financial planning created several challenges that DME is still facing today. "Provisions for monitoring and oversight of the CIP program, including reporting requirements and how to handle changes and amendments to the plan." Uncertainty about project funding, project viability and project prioritization has damaged confidence in PUB and DME decision making. Multiple efforts have recently been made to remedy this, but the systems and practices to ensure clarity in capital project monitoring are still a work in progress. ao NEWGEN STRATEGIES AND SOLUTIONS, FBACK GFOA Best Practice Comparison (cont'd) Area: Communicating Capital Improvement Strategies (Policy date February 2014) DME has suffered significant loss in public trust by not following this practice. Examples are below "Capital programs gain from the support of the community both to ensure that capital projects will deliver expected and desired outcomes as well as to ensure there is adequate support for the investment." The Renewable Resource Plan calls for the Power Purchase Agreements needed to reach the 100% renewable goal to be completed by 2020. However, the costs and risks in delivering on the 100% plan may not have been clearly communicated and rate increases (if any) related to 100% renewable sources may or may not be well-received by DME customers. ". . .recommends that organizations develop a communications plan for public participation focused on explaining capital needs, options, and strategies and facilitating feedback in advance of any major capital program. " The Denton Energy Center became a very sensitive community issue, but only after the decision was made. 81 NEWGEN STRATEGIES AND SOLUTIONS, BACK GFOA Best Practice Comparison (cont'd) Area: Capital Project Monitoring and Reporting (Policy date October 2017) DME has a strong history of capital project management and seeing projects through has assisted in its FERC accounting and TCOS filings. DME meets this guidance, which is generally described below. 1 . Identify and incorporate legal and fiduciary requirements into capital monitoring and reporting processes." "2. Identify relevant data for external and internal stakeholder information needs." "3. Plan and design systems to collect, store, and analyze project data and to report results." 'A. Regularly monitor capital projects' financial and project activity information." "5. Reporting on project status and activities." "6. Project close-out." - "T Evaluate monitoring and reporting activities." 82 NEWGEN STRATEGIES AND SOLUTIONS, GFOA Best Practice Comparison (cont'd) Area: Creating a Comprehensive Risk Management Program (Policy date March 2009) DME has contracted with Deloitte to evaluate and set in place plans to mitigate risk throughout DME - NewGen generally concurs with Deloitte recommendations DME has already started change efforts or implementation of several recommended strategies including: Reviewing and updating the Enterprise Risk Management Policy Evaluating and planning to implement Energy Trading Risk Management system Improving clarity in boundaries in Delegation of Authority for transactions Clarifying hedge strategies, limits and quantifiable objectives Improved training for PUB members 83 NEWGEN STRATEGIES AND SOLUTIONS, GFOA Best Practice Comparison (cont'd) Area: Evaluating Service Delivery Alternatives (Policy date September 2018) • DME meets this guidance, with the few exceptions below: "Consideration must be given to how service delivery is affected by demographics, the economy, geography, citizen sensitivity and the local political environment." Service delivery alternatives for DME include the DEC. While has been mentioned previously, alternatives to DEC may not have been given enough consideration to gain continued public buy-in. "The government should establish clear expectations and standards in analyzing service delivery options. " Both DEC and EMO functions have been questioned recently. DME needs to spell out its expected financial outcomes and analyze the cost and benefits of each. NewGen recommends benchmarking each against similar market or comparator utilities to show the relative benefit of each. This analysis should be shared with the PUB, Council and the public at large. 84 NEWGEN STRATEGIES AND SOLUTIONS, BACK GFOA Best Practice Comparison (cont'd) Area: Key Issues in Succession Planning (Policy date February 2011 ) • DME needs to update its succession planning "Many governments face the challenge of ensuring continuity and consistency of service delivery due to employee turnover. " DME has undergone significant change in senior leadership. Filling key roles has been challenging and succession plans are unclear. DME needs to solidify management and support function roles "Develop written policies and procedures to facilitate knowledge transfer." DME's multiple reorganizations has also changed the nature and responsibilities for a number of roles Documenting expectations for each position is a key first step Knowledge management practices and cross training may help DME cope with any future turnover 85 NEWGEN STRATEGIES AND SOLUTIONS, GFOA Best Practice Comparison (cont'd) Area: Technology in Capital Planning and Management (Policy date October 2011 ) This best practice calls for "Capital Planning for multi-year capital forecasting that identifies needs of new items, replacement items, and major renovations." Denton clearly meets this guidance DME Tech Services 5 Year Roadmap DME has a very solid approach to fY 2017-2018 FY 2015-2019 technology in capital planning SfJtDA and Severity Genera k Refresh Genera Server Refresh Generation Lion Ge SC nera Implementation NERC CIP Audit Invenergy Infrastructure GIS Hardware/Software&Network Refresh RecoverPoint Tech Services in coordination with DME Oracle to SQL Conversion Hosted Solution f f Oracle to SQL Conversion SAN maintains 5-Year Roadmap Backupapacit merre e . . . Backup Capacity Increase VPN&VDI Solutions(Remote Access) Appllcatlom Upgrade ArcFM to ArcGIS Online(Q4) Upgrade to Utility Network This list of major initiatives, confirming funding TrilliantUpgradeto9.9.8 Lifecycle Work Lifecycle Assets(Q3) Graphic Design status and planned timelines Integrate AVL to OMS( du AVLRollout Meter Service Orders Proroduction(Q3!?) ETRM Solution AVL POC ESRI License Transition Dispatch Outage Logging System User Support Metering Laptop Refresh Field Laptop Refresh Communications Laptop Refresh System Operations PC Refresh Exchange Cleanup ' Group Policy Cleanup S:Drive Rights Management Other Initiatives& UAV(Drone)POC Renew 3 Year PS Agreement with SSP Projects Denton Energy Center NERC Audit 86 STRATEGIESNEWGEN • • 76 `Jr „ , � •'tip<, s �. A - 87 Financial Annual Financial Strategies Review and Documented Path Forward Denton has done a good job reviewing financial policies annually for DME as well as Water and Wastewater Funds Favorable AA- Bond Rating from S&P — Report from March 14, 2019 Related to Denton Utility System Revenue Debt Per S&P's Report "We consider the utility's financial management policies and practices very strong..." "Extremely strong liquidity and reserves" "Very strong fixed-charge coverage and...plans to cash fund more than half of its capital improvements plan (CIP).' • The utilities' Financial Strategies and Practices were compared to the best practices promulgated by the GFOA 88 NEWGEN STRATEGIES . SOLUTIONS, BACK GFOA Best Practice Comparison Area: Working Capital Targets for Enterprise Funds (Policy date February 2011 ) "GFOA recommends that local governments adopt a target amount of working capital to maintain in each of their enterprise funds. Ideally, targets would be formally described in a financial policy and/or financial plan." Denton Water and Wastewater meets this guidance. Reserve i Water Target Wastewater Target Working Capital 85/6 8% M Operating Reserves 25-42% 20-31% Operating Days 120-180 Days 100-140 Days Given its substantial cash funding for capital repair and replacements, restricted and any unrestricted working capital should be clearly delineated to make sure no balances used to meet targets are committed for future capital spending. Appropriable balances reported in the Budget exclude Impact Fees, but do not appear to exclude the $1 M Development Plan Line Reserve called for in the financial policies. 89 NEWGEN STRATEGIES AND SOLUTIONS, 79 BACK GFOA Best Practice Comparison (cont'd) Area: Establishing Government Charges and Fees (February 2014) Denton W/WW meets this guidance, with the few exceptions below: "Utilize long-term forecasting. . . If the charges will recover costs associated with other long-term plans, such as a multi-year capital plan, a longer-term service fee plan should be consistent, recognizing the plan may be amended to reflect changing conditions in the future." The Utilities Financial Strategies document reviewed by NewGen suggested an annual 20-year pro forma be completed, but NewGen was unable to identify or review any 20- year financial plans for Denton W/WW. If not already created, this should be done to comply with the City's policy and to consider long-term rate strategies. "State whether the jurisdiction intends to recover the full cost of providing goods and services. Set forth under what circumstances the jurisdiction might set a charge or fee at more or less than 100 percent of full cost. If the full cost of a good or service is not recovered, then an explanation of the government's rationale for this deviation should be provided." Recent rate reductions signal that the budgeting practices or strategy for cash-funding a portion of CIP has changed or may not have been consistent with the longer term financial plan. 90 NEWGEN STRATEGIES AND SOLUTIONS, 80 BACK GFOA Best Practice Comparison (cont'd) Area: Establishing Government Charges and Fees (cont'd) (Policy date February 2014) - Denton W/WW uses a 1 .25 debt service coverage ratio in setting rates This is a good policy and helps ensure bond payments are adequately covered. Per policy, this may be supplemented by operating reserve funds to meet 1 .25 While City policy allows for this use of reserves, Denton W/WW should be cautious in its application as some bond pledges may specifically prohibit use of reserves. 91 NEWGEN STRATEGIES AND SOLUTIONS, BACK GFOA Best Practice Comparison (cont'd) Area: Capital Planning Policies (Policy date September 2013) Denton W/WW meets this guidance, with the few exceptions below: "To create a sustainable capital plan, the finance officer and other participants in the capital planning process need to consider all capital needs as a whole, assess fiscal capacity, plan for debt issuance, and understand impact on reserves and operating budgets, all within a given planning timeframe." Until recently, the Denton Finance Department has had limited involvement and project accounting for capital planning has been challenging. While this is being corrected, NewGen believes this historical disconnect between City finance and W/WW financial planning created several challenges that Denton W/WW is still facing today. "Provisions for monitoring and oversight of the CIP program, including reporting requirements and how to handle changes and amendments to the plan." Project funding and significant excess transfers without a clear plan have damaged confidence in cash funding needs within rate revenue requirements for W/WW. Multiple efforts have recently been made to remedy this, but the systems and practices to ensure clarity in capital project monitoring are still a work in progress. 92 NEWGEN STRATEGIES AND SOLUTIONS, FBACK GFOA Best Practice Comparison (cont'd) Area: Communicating Capital Improvement Strategies (Policy date February 2014) Examples for areas of improvement are below "Capital programs gain from the support of the community both to ensure that capital projects will deliver expected and desired outcomes as well as to ensure there is adequate support for the investment." Cash capital has been consistently set aside, which has been seen as very favorable when reviewed by bond rating agencies. Denton W/WW has not been effective in consistently delivering on planned capital project implementation and have accumulated significant cash funding as a result. This build up of cash, following years of rate increase without clear understanding, has eroded confidence in the practice. ". . .recommends that organizations develop a communications plan for public participation focused on explaining capital needs, options, and strategies and facilitating feedback in advance of any major capital program. " Denton W/WW and City leadership are instituting a Project Management Office, which will aid in successfully meeting this best practice. 93 NEWGEN STRATEGIES AND SOLUTIONS, BACK GFOA Best Practice Comparison (cont'd) Area: Evaluating Service Delivery Alternatives (Policy date September 2018) Denton W/WW meets this guidance, with the few exceptions below: "Consideration must be given to how service delivery is affected by demographics, the economy, geography, citizen sensitivity and the local political environment." Denton W/WW has made efforts to save money through the use of internal crews for capital projects. When project scheduling and internal staff capacity allows, this practice has been to the benefit of Denton rate payers. City staff may create cost savings from internal crews, but savings and quality of service may be overstated if project timelines suffer or the project are not being completed. Denton should consider further supplementing internal crews given the volume of projects that are backlogged. "The government should establish clear expectations and standards in analyzing service delivery options. " For example, if a standard was set that employees would consistently provide the highest value possible, certain activities (such as mowing around water facilities) may be considered for outsourcing or best completed by other departments with routine outdoor maintenance duties. 94 NEWGEN STRATEGIES AND SOLUTIONS, 84 BACK GFOA Best Practice Comparison (cont'd) Area: Technology in Capital Planning and Management (Policy date October 2011 ) Denton W/WW meets much of this guidance, but could improve as outlined below. "Alignment with other organization-wide planning efforts will avoid redundant systems and will provide a greater opportunity for systems to efficiently support end-to-end business processes." - Denton W/WW has limited strategic coordination with the Tech Services function. One example that merits review is the use various fiber backbones to support SCADA and possible, while limited, information sharing for non-sensitive operations data. ". . .analyze the projected benefits, costs, and risks in moving to a new system to determine if there is a suitable business case for moving forward." Denton W/WW should reconsider Advanced Metering Infrastructure (AMI). The meter reading requirements for water is substantially more time consuming than getting electricity usage from smart meters throughout the City. Neither DME nor Denton W/WW are getting the full benefit of smart meters since the meter reading function is still required on a monthly basis. If AMI is not deployed for Denton W/WW, a review of the meter reading function may result in additional cost assignment to W/WW. NEWGEN STRATEGIES AND OLUTIOSNS, BACK Capital Planning Money has been set aside for capital projects for several years with no real plan to spend the money causing CMO and Council to question the need for the capital money, planning abilities of the utilities and ability to get projects done in a timely fashion especially in relation to public works and development projects. Both the Water and Wastewater Utilities need to develop a program to execute the Capital Plan. 96 NEWGEN STRATEGIES AND SOLUTIONS, Water Capital Project Water Water Transfers to Projects Versus Capital Spending Transfers in Excess of Capital Spending N $18 N $18 17.0 o $16 0 $16 $14 $14 $12 11.6 11.7 $12 10.5 $10 8.0 $10 $8 6.8 $8 $6 5.3 5.0 5.6 5.2 $6 4.5 $4 $4 $2 $2 1.5 kh FY15 FY16 FY17 "'"' FY15 FY16 FY17 FY18 ■Transfer Actual ■Actual Expense ■Cumulative Excess After Expense Project funding in water is building up but expenses are not keeping pace. Large projects and a total 5-year CIP of over $111 Million can create backlogs, but it was not apparent during our interviews why this level of transfers were accumulating in the most recent years. 97 NEWGEN STRATEGIES AND SOLUTIONS, Wastewater Capital Project Transfers Wastewater Wastewater Transfers to Projects Versus Capital Spending Transfers in Excess of Capital Spending $18 $18 16.6 c c 0 $16 0 $16 $14 $14 $12 10.3 $12 10.8 $10 8.6 $10 $8 $8 $6 4.1 5.5 4.4 $6 5.0 $4 3.0 2.9 $4 2.4 1.6 FY15 FY16 FY17 FY15 FY16 FY17 FY18 ■Transfer Actual ■Actual Expense ■Cumulative Excess After Expense Project funding in wastewater is also building; expenses are much less than transfers. With projects scheduled for the next 5-year CIP totaling almost $50 Million, the $16 Million may be fully assigned. Regardless, it would seem the project spending would catch up to the transfers as more construction is completed on time. 98 NEWGEN STRATEGIES AND SOLUTIONS, 88 �a s = o. Y... O 99 BACK Budget Process From interviews, we understand the budget process was not previously handled the same as other City departments This is likely related to both the role of PUB and decentralized Finance functions As of FY 2020 budget setting, DME, Water and Wastewater are now submitting budget packets similar to other departments NewGen sees this change as a very positive step in getting PUB-directed departments in sync with City-wide budgeting practices This, like most change, may create some discomfort in the first few years Similar budget review will help build confidence in budgeted expenses The typical calendar for the new budget process is detailed on the following page Better budgets will produce more accurate revenue requirements that the PUB and Council can rely on to forecast costs and set rates appropriately 100 NEWGEN STRATEGIES AND SOLUTIONS, 90 2020 Budget Process CIP submissions due to Finance Utilities Budgets Due to City Manager/ACM Finance Review of Utilities Budgets Public Utilities Board Public Utilities Board reviews changes/updates Reviews Utility Budgets to Utilities Budgets • and CIP PUB reviews any proposed Utilities Rate PUB approves Utilities Changes Budgets and CIP Council Budget Workshop(First) Proposed Utility Budgets I Provide proposed rate and CIPs submitted to increases City Council and filed Utilities contacts Public with City Secretary Communications Office to begin work on Rate Brochure Council Meeting: Budget Workshop(Second) L 101 STRATEGIESNEWGEN • • 91 Cost AlBudgeting Denton has fully allocated costs from General Fund, IT and Other Internal Service Funds Given the level of costs these represent, these allocation amounts should be reviewed and updated annually 102 NEWGEN STRATEGIES AND SOLUTIONS, 92 �a s = o. Y... O 103 I OR Vic, ti $ � 1,1311 "1 Jill � � ��►�� Infrastructure Condition Assessment Denton Municipal Electric System Condition Electric system site visits: Arco Substation Hickory Substation Locust Substation McKinney Substation Denton Energy Center (DEC) System Operations Center (SOC) Reviewed inspection and maintenance practices Reviewed system planning studies and capital improvement plans Included comprehensive 5-year Roadmap List of major initiatives, confirming funding status and planned timelines 105 NEWGEN STRATEGIES AND SOLUTIONS, 95 Arco Substation r r i Substation facilities are relatively I - records • in-service date / of - 2016Relay -1- -�. Design and construction follows best utility practice • protection schemes I SCADA systems are considered to be best in class Inspection, - • I • maintenance practices are wellabove average Overall facility condition is excellent 0. NEWGEN STRATEGIES AND SOLUTIONS, LLC 96 Hickory Substation Hickory Substation facilities are among the oldest on DME's }I �I m� records h m system; eco ds w s o some - f equipment with initial in-service date of April 1968 - Some of the Hickory Substation �� :. a facilities have been upgraded = Older substation facilities have been well maintained, but are due e� for upgrade/replacements ' � Ip# = 1N Ilk +� i it A� I1I1 107 STRATEGIESNEWGEN • • 97 Locust Substation New Locust Substation is under construction New substation design, construction, and configuration is similar to Arco and McKinney Old Locust Substation is relatively dated; records show in-service date of major equipment to be May 1980 Facilities have been well -- _ maintained, but are due for upgrade/replacement Y 108 STRATEGIESNEWGEN • • 98 McKinney Substation Substation facilities are relatively new; records show in-service , date to be June 2015 Design and construction follows utility best practice Relayand protection schemes and SCADA systems are considered to be best in class j Inspection, testing, and maintenance practices are well p M11.11Aabove average Overall facility condition is excellent 109 NEWGEN STRATEGIES AND SOLUTIONS, 99 Denton Energy Center The Denton Energy Center (DEC) is a 225MW generating plant including 12 Wartsila gas- fired engines — DEC became operational in July 2018 and provides capacity and p p Y price hedging for DME's � renewable energy program ® DEC facilities are well maintained _ and are in excellent condition Fla M 110 STRATEGIESNEWGEN AND • • 100 System Operations Center The Denton System Operations - Center (SOC) is the focal point for � L12n dailymanagement, dispatch service, Rr mana Y g p emergency response and restoration JF : y for Denton's utility systems One half of the SOC deals with the City of Denton s water, wastewater, - , ram, o and solid waste systems .,x n OWplc One half of the SOC deals with ° 0-1 DME's electric transmission and " °s°° distribution system a.� De on "y Cefli(nl ical The SOC became operational in 2012 and has undergone periodic technology upgrades ° SOC facilities are ranked to be best utility practice , NEWGEN STRATEGIES AND SOLUTIONS, Review of Periodic Inspection & Maintenance Practices Review included: Checkout summary for new construction Weekly substation inspections / reports Infrared inspection of substations and transformers Breaker testing and maintenance (15kV, 69kV, and 138kV) SF6 breaker gas analysis Substation transformer oil and dissolved gas testing Relay testing Substation battery/charger inspection and maintenance Pole inspection program Tree trimming program • DME's inspection and maintenance practices ranked good to excellent 112 NEWGEN STRATEGIES AND SOLUTIONS, 102 M M- V ,4 Infrastructure Condition Assessment Denton Water and Wastewater Utilities Water.-System NewGen reviewed water infrastructure in the field including the Lake Lewisville water plant and several water tanks. In general, water plant was clean and — appeared well-maintained. Good - housekeeping practices exist and staff interviewed seemed to understand the necessity of their jobs to produce safe, clean drinking water. Only issue was with the lack of coordination with the water distribution staff which may have caused over pressurization of water distribution system and one or more water line breaks. There needs to a shared SCADA system showing the water plants and the distribution system at the plants and in the distribution - offices as well with current system data available. Tanks were recently painted and did not exhibit any discoloration of the metal structures nor rust. 114 STRATEGIESNEWGEN • • 104 Wastewater NewGen reviewed wastewater infrastructure ' in the field including the wastewater plant and one lift station at the wastewater plant. In general, wastewater plant was not clean } but appeared to be operating in good _°_ , condition. Good housekeeping practices are not being followed, unnecessary items were left around offices and parts of the plant vs. being stored in proper places or trash being thrown away. In general, most areas were trashy and not well kept. A "temporary" area with blue sheeting covered one of the sand filters which are not in use and apparently have not nor will ' � be for some time causing a safety hazard. � Staff interviewed seemed to understand f. k, � the necessity of their jobs to produce safe, ' reclaimed wastewater not overflowing or spills from facilities. JNINO 115 NEWGEN STRATEGIES AND SOLUTIONS, 105 Wastewater (cont'd) One issue was with the lack of technology, manual process and only one operator trained on how to operate the digester solids belt press to the drying beds which makes it challenging to keep the solids from overflowing especially on - weekend and holidays. Operator has to manually check the belt press even on weekends and holidays due to the lack of _ ► ' cross-training and technology improvements. - Wastewater Plant Not Integrating on City - . S Network While we understand it is a wastewater plant and inherently is dealing with a nastier product than the water plant, we have served as supervisors and operators in other plants as well have assessed many plants and have seen pride in the staff keeping the quarters clean and tidy. 116 STRATEGIESNEWGEN • • 106 �a s = o. Y... O 117 BACK Succession Planning NewGen was not provided a written Succession Plan for the Utilities. Verbal discussion was held on some succession planning initiatives. Succession planning and employee development is largely left up to individual supervisors and managers. The Utilities are working with Human Resources to develop a Utility wide Succession Plan and accompanying Employee Development Plan for all employees. 118 NEWGEN STRATEGIES AND SOLUTIONS, 108 Human NewGen did not conduct HR interviews or an independent review of specific H R practices. Observations here were gathered from interviews and are for thoughtful consideration only. NewGen does not make a recommendation to change policies or practices outside of further review. Finding, hiring and retaining qualified staff has been difficult. Could benefit from a Utilities Career website and video, similar to Fire and Police Careers links Sick leave may be too generous. Accruing 10 hours each month up to a maximum 720 hours creates substantial liabilities and may create sense of entitlement. Perceived inequity by those who are not out sick may create moral hazard to abuse sick days. Combination of more guilt-free, general paid time off bank of hours, with backstops in catastrophic leave policy and short-term disability coverage (already offered) may improve benefit plan offering and work scheduling 119 NEWGEN STRATEGIES AND SOLUTIONS, 109 Organizational Assessment - Overview NewGen performed an overall Organizational Assessment of the Utilities which reviewed all parts of the Utilities including People, Process, Data, Financial, Technology, Infrastructure to identify what is working and what needs improvement. 120 NEWGEN STRATEGIES AND SOLUTIONS, 110 Recommended Organizational Changes City of Denton Organization Chart Updated June 05,2018 City Manager Deputy City ManageriCOO Assistant City Manager Departments Reporting to Mario Canizares the City Manager Human Resources Technology Services Utilities Transportation Police Fire Director Chief Technology Officer General Manager Director Chief Chief Parks and Recreation Library Water Airport Animal Services Community Improvement Services Director Director Wastewater Facilities Solid Waste Fleet Services Denton Municipal Electric Development Services City Secretary Economic Development Environmental Services BikeiPedestrian er Director General Manager Gas Well Inspections 9 Director Capital Projects Building Inspections Finance Public Affairs!IGR Director Planning Director Director Procurement and Compliance Engineering Streets Director Accounting Community Development Drainage Budget/Treasury Communications —Traffic —Customer Service Materials Management LMunicipal Court Consider moving under common Assistant or Deputy City Manager 121 NEWGEN STRATEGIES AND SOLUTIONS, I OR . . 1 . .� ..,.. Organizational Structure Denton Municipal Electric BACK Organizational Overall the structure is "chunky" Numerous departments and layers of management that would not seem to be needed for a utility of DME's size Structure lends to silos at the managerial level Seems to work at the "operational level" where the field work takes place NewGen recommends a deeper analysis before making any organizational changes including: Full FTE analysis Evaluation of need for open positions Management layer and span of control analysis Integration with formalized Succession Plan 123 NEWGEN STRATEGIES AND SOLUTIONS, `Jr „ , � •'tip<, s . A - _ fir._ 4� _=w• _Organizational Denton Water and Wastewater Utilities 124 BACK Organizational Organizational changes recently made to separate duties of General Managers into 2 parts 1 ) Transmission & Distribution System 2) Plants and Meter shop No one person responsible for water utility and wastewater utility Role confusion and disorganization due to new organizational chart, roles not documented nor defined clearly Staff below management level has adapted and continues to bring stability to utility operations despite changes 125 NEWGEN STRATEGIES AND SOLUTIONS, BACK Organizational Changes recently made to separate functions from each utility that can/should reside at the City level including parts or all of finance, engineering , capital projects, procurement, information systems, transportation and warehousing New procedures need to continue to be written and training provided to staff to avoid confusion going forward to develop the "Denton Way" Needed to modernize and formalize manual and historical processes that need updating and streamlining Clear communication needed to ensure smooth change management of operations and areas affected Some system planning and modeling staff needed at utility level for sustainability of operations and to assist with capital planning functions 126 NEWGEN STRATEGIES AND SOLUTIONS, 116 Organizational New organizational structure and key hires are needed for clarity, give new direction with experienced leadership Suggest organizational structure with either experienced overall General Manager for both utilities or separate GMs Move one existing position to system planning function to bring all system modeling and planning functions in house for both water and wastewater Other suggested organizational changes are shown in the following pages with key themes of consolidation and streamlining of management layers and positions and improving span of control 127 NEWGEN STRATEGIES AND SOLUTIONS, WATER ADMINISTRATION ASSISTANT CITY MANAGER GENERAL MANAGER OF UTILITIES DIRECTOR OF DIRECTOR OF [!RONMENTAL ANTDIRECTOROF DEPUTY DIRECTOR ADMINISTRATIVE WASTEWATER WATER SERVICES WATHiNVASTEWAT� SUPERVISOR System Planning& Nbdehng WASTEWATER UTILITY ENGINEERING DIVISION MANAGER ADMINISTRATIVE COORDINATOR GIS ANALYST ASSISTANT IV VACANT 1 CONSTRUCTION AC AI`IISTRATIVE ENGINEERING INTERN 11 PROJECTS MANAGER ASSISTANT 11 WATER'UTILITIES F;MI N I STRATIVE ASSISTANT 11 ENGINEERING TECHNICAL CCORDINATOR - '- MANAGER =`'GINEERING INTERN 11 ENGINEERING ENGINEERING TECHNICIAN III TECHNICIAN IV ENGINEERING ENGINEERING INTERN II TECHNICIAN 11 VACANT Move under System ENGINEERING ENGINEERING INTERN II Planning & Modeling TECHNICIAN 11 II organization 128 NEWGEN STRATEGIES AND SOLUTIONS, 118 WATER UTILITIES ASSISTANT CITY MANAGER GENERAL MANAGER OF UTILITIES DIRECTOR DEPUTY DIRECTOR OF WATER WATER d WATSEWATER System Planning&1Vbdeling WATER PRODUCTION WATER METER/CROSS CONSTRUCTION PROJECTS WATER UTILITIES WATER&WASTEWATER SUPERINTENDENT CONNECTION CONTROL MANAGER MANAGER COORDINATOR SUPERINTENDENT SCADA!REGULATORY FIELD SERVICES WATER DISTRIBUTION SUPERVISOR SUPERVISOR MANAGER LAKE RAY ROBERTS PLANT MANAGER FIELD SERVCIE SUPERVISOR LAKE LEWISVILLE PLANT MANAGER FIELD SERVCIE U PERVISOR :'vATER PRODUCTION SE%ICR ENGINEER 129 NEWGEN STRATEGIES AND SOLUTIONS, 119 ASSISTANT CITY MANAGER WASTEWATER GENERAL MANAGER CAPITAL PROJECTS OF UTILITIES DIRECTOR UTI LITI ES DIRECTOR DEPUTY DIRECTOR OF DRAINAGE OF WASTEWATER WATEWWASTEWATER SyStemPlannTng MANAGER - - - &Nbdeling GIS WASTEWATER RECLAMATION WATEPJWASTEWATER ADMNIS-RATNE ANALYST SUPERINTENDENT SUPERINTEOANT ASSIS-ANT III FIELD SERVICES ENGINEERING INTERN II WATER REC WASTEWATER COLLECTIONS ENGINEERING TECHNICAL ADMINISTRATIVE SUPERVISOR MANAGER MANAGER ASSISTANT III WATER REC- OPERA-IONS MNGR. FIELD SERVICES ENGINEERING SUPERVISOR TECH it SCADA NETWORK Consider moving SPECIALIST FIELD SER`JICE3 ENGINEERING SUPERVISOR TECH II Pretreatment ELECTRICAL Operations to ELBC.FOREMAN ENGINEERING Wastewater TECHNICIAN II organization REGTICOWJLAS MG ENGINEERING TECH N BENEFICIAL REUSE MANAGER ENG INTERN II ENG INTERN II CUSTOMER SERVICE REP. WASTEWATER UTILITY COORDINATOR FIELD SERVICES SUPERVISOR Move under System ADMNISTRATTVE ASSISTANT III 130 Planning & Modeling organization Organizational NewGen recommends a deeper analysis before making any organizational changes including: Full FTE analysis Evaluation of need for open positions Management layer and span of control analysis Integration with formalized Succession Plan (being recommended in this report) 131 NEWGEN STRATEGIES AND SOLUTIONS, �a s = o. Y... O 132 BACK Support Services Need for better communication with other City departments especially with more services moving to City departments i.e. IT, Procurement, Transportation, etc. Process changes instituted in the Procurement area by the City to develop and establish standard policies and procedures are good to see. The City should recognize the impact on DME and all parts of the City which were not accustomed to standard ways of centralized procurement. Previously, DME procured supplies/equipment themselves as needed. Implementation of new policies was disruptive and needs to be more efficiently planned for in the future. 133 NEWGEN STRATEGIES AND SOLUTIONS, System Planning & Modeling — DME DME has a fairly robust system planning and modeling function that is used to develop its capital plans. Engineers work with operations to identify areas of the system needing hardening in advance of actual need for the improvements. Focus has been on large improvements to the transmission backbone, substations and some parts of the distribution system. NewGen understands there are few areas of the distribution system that need hardening to avoid local reliability issues. Overall system reliability is good for DME with few outages of any duration. 134 NEWGEN STRATEGIES AND SOLUTIONS, BACK System Planning & Modeling Water/Wastewater NewGen was not provided current written Master Plans based on hydraulic modeling for the water system that is tied to a capital plan. The wastewater utility has an asset management plan which is very detailed in procedures and technologies used to risk rank the wastewater collection system. A high level 5 year capital plan is included in this annual report as well as historical info for the year provided initiatives but a list of capital projects was not seen. System Planning has largely been performed by the former managers of each utility using outside consultants to perform the actual modeling and planning studies, if done. Both the Water and Wastewater Utilities need to develop in-house expertise of utility staff working with engineering to perform system modeling and planning on an on-going basis to formally produce an annual master plan that is tied to a capital plan for the each budget year, next 3 years and a 10 year horizons. If outside consultants are used at some point, the work should be bid with other consultants who currently do not work for the City and their role should be as an extension of staff with staff owning the process. 135 NEWGEN STRATEGIES AND SOLUTIONS, e ,Opr*-Im aw Ole O STRATEGY 136 126 BACK Strategic PlanningDME NewGen was not provided , Strategicwritten Plan for Verbal discussion was held on • - strategic initiatives. NewGen suggests that DME go through a Strategic Planning Legend process reviewing the existing Single Certified state, issues to be aTriple Cerfified and future state needed ddressed Dual Certified �•/?ri(� � Yid • �i�lu�►� 11R(iv�'2�� desired to produce a r• , �I.... guide decision making, priorities and capital road map should also include a plan to recognize the competitive nature of multi-certified areas 137 NEWGEN STRATEGIES AND SOLUTIONS, LLC 127 BACK Strategic Planning NewGen was not provided a written Strategic Plan for the utilities. Verbal discussion was held on some strategic initiatives. Both the Water and Wastewater Utility need to go through a Strategic Planning process reviewing the existing state, issues to be addressed and future state needed and desired to produce a roadmap to guide utility decision making, priorities and capital expenditures. 138 NEWGEN STRATEGIES AND SOLUTIONS, �a s = o. Y... O 139 I OR Franchise & Payment in Lieu of Taxes Denton Municipal Electric Current Computation of Franchise Fees Return on Investment ( ROI ) Computation of Franchise Fees 5% of Gross Revenue excluding: ECA Revenue Denton Energy Center Revenue TMPA Coverage Revenue Interest Other Non-Utility Revenue ECA Franchise Fees limited to $.03/kWh sold Computation of ROI Essentially treated as a Payment in Lieu of Taxes (PILOT) Current computation is 3.5% of Gross Revenue with no exclusions Effective Rate on Total DME Operating Revenue Franchise Fees effective rate from 2013 through 2017 — 4.30% ROI effective rate from 2013 through 2017 — 3.01 % Use of Franchise Fees and ROI Based on the FY 2018-19 Budget, approximately 24.4% of total franchise fees will be transferred to the General Fund and the remaining 75.6% of the franchise fees will be transferred to the Street Improvement Fund All ROI related fees are transferred to the General Fund. 141 NEWGEN STRATEGIES AND SOLUTIONS, Comparison to Other Texas Municipal Electric Power Providers Typical Computation Based on Percentage of Revenue Majority Compute Based on a Percentage of Gross Revenue Specific Computations AE computes a general fund transfer (GIFT) GFT includes both franchise fees and PILOT (ROI) Set at no more than 12% of non-fuel revenue Set a floor of annual recovery of $105 million DME effective total of Franchise Fees and ROI for non-fuel revenue is 11 .17% from 2013-2017 Lubbock computes a franchise fee based on 5% of gross revenue Lubbock PILOT is 1 % of gross revenue BTU computes a per kWh charge for franchise fees PILOT is computed based on a percentage of the approved rate of return used in the TCOS However, a percentage of 7% of gross revenue has been set as a cap on these two computations Currently BTU is at approximately 6.5% of gross revenue for the combination of franchise fee and PILOT CPS computes a combined GIFT similar to AE with a 14% of gross revenue Revenue related to schools and hospitals is excluded 142 NEWGEN STRATEGIES AND SOLUTIONS, Comparison to Other Texas Municipal Electric Power Providers (cont'd) Typical Computation Based on Percentage of Revenue (cont'd) GEUS is similar to Lubbock Franchise Fee are 5% of Gross Revenue, as adjusted for: Fuel for off-system sales PILOT is 1 % of Gross Revenue, as adjusted Goes to Greenville Board of Development Garland Power & Light only charges an ROI Approximately set at $19.5 million per year Equates to an approximately 7% of total operating revenue in 2017 San Marcos Water and Power charges a franchise fee of 8% Georgetown Utilities charges a 3% franchise fee and a 7% ROI in its electric rates 143 NEWGEN STRATEGIES AND SOLUTIONS, National Municipal General Fund Transfer for I - Fees and/or • Based on a 2016 survey conducted by the American Public Power Association that included 171 respondents: Over 79% (136 respondents) have some form of PILOT Approximately 26% compute the payment based on a percentage of electric operating revenues, with a notable percentage (13%) based on a flat annual amount Only 10% reported use of a charge per kWh sold Based on the regional variations, the West South Central respondents, which includes public power operations in Texas, Arkansas, Louisiana and Oklahoma, remitted the highest median percentage of electric operating revenues (12.6%) based on 36 responding utilities Based on all respondents, payments made to state and local governments by public power operations produced a median percentage of 5.6%, with utilities over $100 million in revenue at 6.2% 144 NEWGEN STRATEGIES AND SOLUTIONS, Comparison to Municipal Charges to IOUs Electric IOUs in Texas are charged franchise fees and property taxes separately The majority of electric IOUs are charged franchise fees based on a $/kWh as prescribed by the Public Utility Regulatory Act (PURA) §33.008. Municipal property taxes vary by location 145 NEWGEN STRATEGIES AND SOLUTIONS, Comparison to Municipal Charges to IOUs Non-ERCOT IOUs remit franchise fees based on the following paradigms: Entergy — Based on negotiated $kWh charges with each municipality charges rangings from $.00053/kWh to $.0015908/kWh." El Paso Electric — Current rates have a 4% franchise fee embedded in the tariff and an additional 1 % payment (5% total) to the City of El Paso. This is an additional 0.75% (4.75% and 5.75%) charged for revenue received by El Paso Electric for broadband services over powerlines. SWEPCO — Current rates have franchise fees embedded in the rates at $.0005528/kWh plus riders to collect the amounts over by municipality. The latter comprise approximately 55% of the total franchise fees. The total amount is approximately 1 .78% of total revenue, both from incorporated and unincorporated service areas. SPS (Xcel Energy) — Current rates have an embedded amount of 2% in the customer service rates with any additional percentage by municipality included as a line item on the bill. For example, the City of Amarillo has an additional 2% above the embedded 2% included in rates. The City of Post has an additional 3% of gross receipts charged on customers' bills based on a 2017 franchise agreement. 146 NEWGEN STRATEGIES AND SOLUTIONS, 136 Conclusions DME Franchise Fees and PILOT ( ROI ) Texas Utilitio%e- Comparisons National Comparisons • DME's fees based on a % of gross revenue is similar The vast majority of electric utilities are charged to other municipal electrics computations and non- franchise fees by the franchising authority ERCOT Texas IOUs The median national percentage franchise fee DME has a capped franchise fee on commodity charged to public power is approximately 5.6% of revenue where other have excluded this revenue in gross revenue the computation of franchise fees Public power with revenue over $100 million reported A 5% franchise fee is within the range of fees charged an average percentage of 6.2% by other Texas municipal electrics Public power operations in Texas, Arkansas , A 5% for franchise fees is equal to or slightly higher Louisiana, and Oklahoma reported higher than fees charged by non-ERCOT Texas IOUS. percentages than other areas within the US A 3.5% ROI is within the range of ROls charged by DME is slightly lower than national median Texas municipal electrics The vast majority of public power utilities also has a A 3.5% ROI appears low in light of returns approved PILOT charged by the franchising authority for TCOS filings On a national basis, IOU electrics are charge a Texas municipal electrics vary in whether the fees are franchise fee varying in percentage, but generally termed as franchise fees, PILOTs or ROI and ranges noted to be between 3% and 6%. from 6% to 14% when added together 147 NEWGEN STRATEGIES AND SOLUTIONS, - - M- V low Franchise & Payment in Lieu of Taxes Denton Water and Wastewater Utilities Current Computation of Franchise Fees & Return on Investment ( ROI ) Franchise Fees Computation Water Services 5% of Gross Revenue Excluding: Interest Income Water for Resale Water Impact Fees Wastewater Services 5% of Gross Revenue Excluding: Interest Income Wholesale Wastewater Services Wastewater Impact Fees Drainage Fees ROI Computation Water and Wastewater Services Essentially treated as a Payment in Lieu of Taxes (PILOT) Current Computation is 3.5% of Gross Revenue with Same Exclusions as Franchise Fees 149 NEWGEN STRATEGIES AND SOLUTIONS, 139 Current Computation of ROI & Return on Investment ( ROI ) • • Historical Effective Rates Based Franchise Fees Effective Rate from 2013-2017 Water Services — 4.79% Based on CAFR Operating Revenue Wastewater Services — 4.72% Based on Adjusted Gross Revenue Use of Franchise Fees & ROI for Water and Wastewater Based on the FY 2018-19 Budget: Approximately 24.4% of Total Franchise Fees will be Transferred to the General Fund Remaining 75.6% of the Franchise Fees will be Transferred to the Street Improvement Fund All ROI Related Fees are Transferred to the General Fund 150 NEWGEN STRATEGIES AND SOLUTIONS, 140 Comparison to Other Texas Municipal Water & Wastewater Service Providers Typical Computation Based on Percentage of Revenue Majority Compute Based on a Percentage of Gross Revenue Specific Computations AE Computes a General Fund Transfer (GFT) GFT includes bother Franchise Fees and PILOT (ROI) GFT Reflects Approximately 8.2% of Water/Wastewater Fund Revenue Services Effective Total of Franchise Fees & ROI Denton Water is 8.13% of Operating Revenue from 2013-2017 Denton Wastewater is 8.03% of Adjusted Operating Revenue Lubbock Compute a Franchise Fee Based on 5% of Gross Revenue for its Water & Wastewater Utility Services PILOT is 1 % of Gross Revenue 151 NEWGEN STRATEGIES AND SOLUTIONS, Comparison to Other Texas Municipal Water & Wastewater Service Providers (cont)d) Typical Computation Based on Percentage of Revenue City of Bryan Computes a Right of Way Payment Fee 5% of Total Water Operating Revenue, Exclusive of: Interest Income Water Tap Fees Transfer in from Other Funds Non-operating Revenue Gain on Sale of Assets 5% of Total Wastewater Operating Revenue, Exclusive of: Interest Income Sewer Tap Fees Transfer in from Other Funds Non-operating Revenue Gain on Sale of Assets City of Greenville is Similar to Lubbock Based on 2019 Budget: Franchise Fees are -4.45% of Total Water/ Wastewater Operating Revenue PILOT is -4.45% of Total Water/ Wastewater Fund Revenue 152 NEWGEN STRATEGIES AND SOLUTIONS, Comparison to Other Texas Municipal Water & Wastewater Service Providers (cont)d) Typical Computation Based on Percentage of Revenue City of Garland Charges Franchise Fee & PILOT Franchise Fee is Based on 5% of Operating Revenue PILOT is Computed Based on Applying the Property Tax Rate to the Value of the Water/Wastewater Assets Water PILOT = -2.67% of Operating Revenue Wastewater PILOT = -7.33% of Operating Revenue San Marcos Water and Power Charges a Franchise Fee of 8% Georgetown Utilities Charges 3% Franchise Fee 7% ROI in its Water/ Wastewater Rates 153 NEWGEN STRATEGIES AND SOLUTIONS, National Municipal General Fund Transfer for I - Fees and/orPILOTS Research shows a franchise fee charge by municipal water and wastewater utilities appears reasonably common and identified separately on a customer's bill Where included, the franchise fees are primarily based on a percentage of the gross revenue Noted ranges for the computation based on a percentage of water and wastewater revenue was 2% to 6% with separately identified franchise fees Several instances were noted where franchise fees were collected based on a fixed charge for each meter size. These appeared to be based on a certain required revenue stream established by the municipality Such computations do provide for more certainty in franchise fee collection when compared to the percentage of a customer's usage of water and sewer services PILOT computations vary nationally, but are primarily based on two methodologies A percentage of water and wastewater revenue; or An application of the local tax rate times the value of the water and wastewater investment Use of this methodology will produce widely varying results among utilities based on the reported asset balances in each operation. 154 NEWGEN STRATEGIES AND SOLUTIONS, Conclusions Water Franchise Fees and PILOT ( ROI ) Texas Water Utilities Comparisons National Comparisons • Denton Water fees based on a % of gross revenue • Water rates reported for operations outside of Texas are similar to other municipal water computations and showed that franchise fees are a typical component Texas water IOUs of the charges to customers • A 5% franchise fee is within the range of fees charged • Fees are general based on a percentage of gross by other Texas municipal water operations revenue like Denton Water • A 3.5% ROI is within the range of ROls charged by • Denton is within the noted range of 2-6% for water Texas municipal electrics related franchise fees • Some Texas water operations charge a single • PILOT (ROI) computations showed wide variations percentage which is comparable to the combination among water operations with some based on a of Denton Water franchise fee and ROI percentage of revenue and other based on property • There is less variability in the total fees charged by tax rates times value of assets. Texas municipal water operations than Texas municipal electric operations 155 STRATEGIESNEWGEN • • Conclusions WW Franchise Fees and PILOT ( ROI ) Texas Wastewater Utilities Comparisons National Comparisons • Denton Wastewater fees based on a % of gross • Wastewater rates reported for operations outside of revenue, but exclude wholesale wastewater services Texas showed that franchise fees are a typical and drainage fees component of the charges to customers • A 5% franchise fee is within the range of fees charged • Fees are general based on a percentage of gross by other Texas municipal WW operations revenue like Denton WW • A 3.5% ROI is within the range of ROls charged by • Denton is within the noted range of 2-6% for WW Texas municipalities related franchise fees • Some Texas wastewater operations charge a single • PILOT (ROI) computations showed wide variations percentage which is comparable to the combination among wastewater operations with some based on a of Denton Wastewater franchise fee and ROI percentage of revenue and other based on property • There is less variability in the total fees charged by tax rates times value of assets. Texas municipal wastewater operations than Texas municipal electric operations 156 STRATEGIESNEWGEN • • 146 �a s = o. Y... 7 77 O COMPARATIVE ANALYSIS (BENCHMARKING ) PURPOSE • D• • 157 Benchmarking Introduction City of Denton (Denton) sought to gain insight from benchmarking the operations of its electric, water and wastewater systems with other comparable utilities and industry statistics. NewGen was retained by Denton to conduct the Benchmarking Study (Study) as part of an Organizational Assessment Study. NewGen is providing analysis of data gathered from publicly available sources for selected benchmark comparison utilities. Utilities were selected for this analysis based on factors such as number of customers, annual electric revenue, or distribution system similarities. This Study collected information from municipal electric utilities and business units of combined utilities related to operational and financial measures. Data sources included publicly owned utilities' annual reports, their respective city's Comprehensive Annual Financial Reports (CAFR), utility financial reports, budgets, websites, the American Public Power Association (APPA) Selected Financial and Operating Ratios of Public Power Systems, 2015 Data and American Water Works Association's 2017 AWWA Utility Benchmarking. The APPA "Southwest" Region included in this report includes 19 participating APPA members in the Southwest Power Pool (SPP) and Texas Reliability Entity (TRE), which in 2015 included the states of Kansas and Texas and parts of Arkansas, Louisiana, Missouri and New Mexico. This report presents results and findings from an analysis performed by NewGen using publicly available information, as well as information provided by Denton related to its operations. 158 NEWGEN STRATEGIES AND SOLUTIONS, Benchmarking Introduction (cont'd) Attempts were made to collect data across all measures from publicly available sources for the following electric utilities: Brownsville Public Utilities Board, Texas (BPUB) Bryan Texas Utilities, Texas (BTU) Fort Collins Utilities, Colorado (FCU) Garland Power & Light, Texas (GP&L) Greenville Electric Utility Service, Texas (GEUS) Lafayette Utility Systems, Louisiana (LUS) New Braunfels Utilities, Texas (NBU) Redding Electric Utility, California (REU) Riverside Public Utilities, California (RPU) 159 NEWGEN STRATEGIES AND SOLUTIONS, 149 Benchmarking Introduction (cont'd) Attempts were made to collect data across all measures from publicly available sources for the following water and/or wastewater utilities: Brownsville Public Utility Board, Texas (BPUB) City of Bryan, Texas (BTU) City of Garland, Texas (Garland) New Braunfels Utilities, Texas (NBU) Frisco, Texas (Frisco) Round Rock, Texas (Round Rock) McKinney, Texas (McKinney) Grand Prairie, Texas (Grand Prairie) Greenville, Texas (Greenville) 160 NEWGEN STRATEGIES AND SOLUTIONS, 150 Benchmarking Purpose and Methodology The purpose of the Benchmarking Study was to compare strategic and tactical performance measures observed at the operations of Denton with the same parameters at other municipal electric, water and wastewater utilities or departments as well as tracking Denton's performance over time. Although there will never be perfectly equitable utility-to-utility comparisons, benchmarking can be a useful tool for system improvement. Each of the utilities used in the comparisons have their own mix of cost factors that determine the nuances of a given utility's performance indicators. Differences such as the ownership and operation of assets need to be kept in mind while reviewing results. Strategic-level parameters addressed include: Revenue per unit of commodity Liquidity Operating income Tactical parameters addressed include: Operations and Maintenance expense ratios Administrative and General (A&G) expense ratios Uncollectible accounts Usage per customer Accounts per Employee 161 STRATEGIESNEWGEN • • Profile of Benchmark Electric Utilities . of No. of Full-time EmployeesElectric Retail Total Equivalent utility/City Customers MWh Sales Electric Revenue (Electric) Denton 51,915 1,449,585 $ 172,027,080 191 Brownsville PUB, TX 48,726 1,320,697 $ 170,631,405 280.5 Bryan, TX 57,940 2,072,312 $ 234,288,951 189 Fort Collins Utilities, CO 72,523 1,499,036 $ 130,655,363 131 Garland,TX 69,929 1,887,188 $ 280,452,721 251 Greenville, TX 16,434 506,087 $ 62,371,543 128.5 Lafayette Utility System, LA 66,860 1,980,653 $ 174,888,543 215 New Braunfels Utilities, TX 38,867 1,512,675 $ 100,006,812 95 Redding, CA 44,233 744,607 $ 165,123,848 180 Riverside Public Utilities, CA 109,274 2,198,000 $ 366,100,000 472 162 STRATEGIESNEWGEN • • Profile Utilities . of Total . of Full-time EquivalentNo. of Water Wastewater 11 Water/Wastewater • . Utility/City Customers Customers Revenue (Water/Wastewater) Denton 34,714 32,618 $67,283,583 151.5/111.25 Brownsville PUB 50,153 50,329 $50,246,097 323.5 (combined W/WW) Bryan 23,223 22,907 $26,540,053 32/37 Garland 69,929 Not available $108,305,941 65/ 102 New Braunfels Utilities 36,140 26,294 $27,528,212 44/39.5 Round Rock 34,179 33,186 $51,980,615 93/35 Frisco 54,261 50,212 $84,647,008 97 (combined W/WW) McKinney 56,512 Not available $78,491,464 103.1 (combined W/WW) Grand Prairie 66,075 Not available $72,668,796 120.5 (combined W/WW) 163 NEWGEN STRATEGIES AND SOLUTIONS, �a s = o. Y... 7 77 O Benchmarking SUMMARY OF : RECOMMENDATIONS 164 Rf, Vic, ti $ � 1,1311 "1 Jill ►'1�l Electric Benchmarking SUMMARY OF FINDINGS & RECOMMENDATIONS Electric Benchmarking — Key Takeaways • EFFECTIVE RATE In terms of effective rate (revenue per kWh) across all retail customers as well as for each customer class, DME should strive for a balance between reasonable rates for customers and sufficient revenue for the utility to sustain itself financially. In addition to monitoring this measure, DME should review its rates structure to ensure adequate fixed cost recovery given the nationwide trend in the growth of customer-sited distributed energy resources. EXPENSES For Administrative & General expenses, DME exhibits higher cost ratios, especially on a per mile of distribution basis. LIQUIDITY DME appears to be operating the utility in such a manner as to have the reserves necessary to pay its short and long-term obligations. To support future Revenue Bond financings, DME should continue to monitor measures such as Days Cash On Hand and Debt Service Coverage Ratio that rating agencies rely on. UNCOLLECTIBLE ACCOUNTS DME showed a substantial drop in uncollectibles per revenue dollar from about 7 cents in 2016 to approximately 3 cents in 2017. If DME instituted a new policy to reduce bad debt in 2017, it appears to be working effectively. If not, DME should investigate what procedures have caused the decline so that it can continue this downward trend. LOAD GROWTH TRENDS DME has experienced a decline in kilowatt hours sales over the period covered in this Benchmarking Study (2015 — 2017). Across the industry, the trend also appears to be in load decline due to a drop in energy intensity. Real estate development in the DME service territory has the potential to overcome decline in energy intensity 166 NEWGEN STRATEGIES AND SOLUTIONS, 156 Financial Performance Measurement How DME Compares • Other Information ■ Lower ratio typically means more affordable rates Revenue per kWh 0 Middle of Comparators ■ Customer mix, load factor,and commodities contribute to differences in ratio Effective Rate Higher than most Comparators and APPA ■ Customer mix, load factor,and commodities contribute to Southwest Region statistics differences in ratio ■ Lower than Comparator average and DME's 2.4-3.7 3-year ratio suggest ability to meet short-term Current Ratio slightly lower than APPA data obligations ■ Lower than 7 Comparators and APPA DME's DSCR is 1.71 Debt Service Coverage Ratio averages DCSR> 1.0 generally means the utility has sufficient funds to pay its (DSCR) 0 Higher than DME's required coverage current debt obligations level ■ Lower than Comparators average Debt to Total Assets 0 Higher than APPA statistics for similar 0 Longer term measurement of liquidity sized utilities Days Cash on Hand ■ Above Comparator median and average In 2017, DME has enough cash to cover 119 days of operating expenses Uncollectable Accounts per Higher than APPA statistics and Suggests DME may want to review its account receivables and Revenue Dollar Comparator median, but lower than the deposit policies average Operating Income to Total Higher number indicates a smaller portion of revenue is going to Revenue ■ In alignment with Comparator median pay operating expenses 167 0DME is earning—$0.08 for every dollar of sales revenue __Tt0TGEi'% STRATEGIES \ D SOL.111TIORS, Operational Performance Administrative & General (A&G) and Customer Expenses A&G expenses are those costs not allocable to power costs, distribution, or customer accounting. Items typically include compensation for executives, office supplies, professional fees, property insurance and claims, and pensions and benefits. DME's ratio of A&G expense per circuit mile is higher than the comparator's average and median. DME's A&G expenses per customer are higher than the average and median, but in line with NBU and APPA statistics for similarly sized utilities. These ratios are subject to each utility's accounting practices and utilities that share A&G expenses across several utility services may exhibit lower cost allocations to its electric operations. The Customer Accounting, Service, and Sales ratio measures the utility's customer-related expenses incurred relative to each customer served. Customer expenses typically include customer service center, meter reading, billing, key accounts, credit and collections, and uncollectable accounts. This ratio is subject to each utility's accounting practices and if services are shared across multiple utility services. DME's ratio is below that of three of the four comparator for which data was available as well as in line with APPA data. 168 NEWGEN STRATEGIES AND SOLUTIONS, Operational Performance (cont'd) Kilowatt-hours per Customer The kWh per customer ratio reflects the average annual usage for all customer classes served by the utility; it is impacted by the distribution of the types of customers served, as well as factors such as energy efficiency measures and the level of customer-owned distributed generation. DME's ratio is slightly above the comparator's average and median. The downward trend in DME's ratio of kWh per customer is not surprising, as it reflects a trend in lower usage seen across the country. Productivity Measures DME's ratios for Customers per Employee and Megawatt hours per Employee are in alignment with the comparators and industry averages, an indication that it is efficiently operating the electric utility. Electric Reliability In 2018, DME's measures for System Average Interruption Duration Index (SAIDI) is substantially better than that of APPA Region 4 utilities and similarly sized utilities. In 2018, DME's measures for System Average Interruption Frequency Index (SAIFI) is similar to APPA Region 4 utilities. • Energy Losses - The Energy Loss percentage is a measure of how much energy is lost in the utility's electrical system and indicates the efficiency of the system. The losses include physical losses occurring in the distribution system, as well as metering and billing losses. DME's ratio is slightly higher than most comparators and APPA averages. NEWGEN STRATEGIES AND SOLUTIONS, • o how Water & Wastewater Benchmarking SUMMARY OF FINDINGS & RECOMMENDATIONS Water & Wastewater Benchmarking Key Takeaways • EFFECTIVE RATE In terms of effective rate (revenue per MG) across all retail customers for both Water and Wastewater operations, Denton should continue to work toward attaining a balance between reasonable rates for customers and sufficient revenue to achieve financial sustainability. LIQUIDITY Denton appears to be operating the Water and Wastewater utilities in such a manner as to have the reserves necessary to pay its short and long-term obligations. PRODUCTIVITY Several of Denton's efficiency measures have indicated lower than average productivity. While climate and water conservation measures have an impact on the water delivered per employee ratio, the seemingly lower levels of productivity should be investigated further. However, this measure is impacted by how services are shared across a municipal organization. For some water and/or watewater operations, activies such as customer service and billing are staffed outside the utility, which would lead to higher productivity indices. 171 NEWGEN STRATEGIES AND SOLUTIONS, 161 Financial Performance Measurement How DME Compares • Other Information Revenue per MG Water 0 Higher than Comparator average for Customer mix and commodity costs contribute to differences in delivered Water,except Garland ratio Revenue per MG Water 0 Higher than Comparator average Customer mix and commodity costs contribute to differences in collected Higher than all Comparators operating ratio wastewater systems in Texas Current Ratio 0 Lower than Comparator average Water's 2.6-5.0 and Wastewater's 3.5-6.1 3-year ratios indicates the ability to meet short-term obligations is more than adequate Debt Service Coverage Ratio 0 Lower than Comparator median for 0 Water's ratio ranged from 1.6 to 2.3 between 2015 and 2017 (DSCR) Water 0 DSCR> 1.0 generally means the utility has sufficient income to pay ■ Above Denton's required coverage level its current debt obligations ■ At Comparator median but slightly lower Debt Ratio than AWWA statistics for Water 0 Water's debt ratio is 32%and Wastewater's is 21% ■ Substantially lower than Comparator and ■ May indicate that Water and Wastewater are not highly leveraged AWWA statistics for Wastewater Operating Income to Total Just below Comparator median for Water ■ Denton is earning—$0.09 for every dollar of Water revenue and Revenue $.018 for every dollar of Wastewater revenue • 172 STRATEGIESNEWGEN AND • • Financial Water/Wastewater Revenue Retail revenue per retail million gallons of water delivered for Water operations and per millions of gallons (MG) of water collected or treated for wastewater operations generally demonstrates the magnitude of water/wastewater rates charged. Customer mix and commodity costs contribute to differences in this ratio. Denton's revenue per MG of water delivered for all retail customers is higher the comparators' average as well as higher than all comparators except for Garland. Denton's revenue per MG of water collected or processed for all retail customers is higher the comparators' average as well as higher than all comparators operating wastewater systems in Texas. 173 NEWGEN STRATEGIES AND SOLUTIONS, 163 BACK Financial Performance - Liquidity (cont9d) Water/Wastewater Liquidity The Current Ratio (current assets compared to current liabilities) is a measure of short-term liquidity. While Denton's results are lower than the benchmark group average, its ratio in the 2.6 to 5.0 range for Water operations and between 3.5 and 6.1 for Wastewater operations over the three years of this Benchmark Study indicates that its ability to meet its short-term obligations is more than adequate. Another short-term liquidity measure is Debt Service Coverage. The Debt Service Coverage Ratio (DSCR) is a measure of cash flow available to pay current debt obligations. This ratio is typically influenced by the utility's financial policies. A ratio greater than 1 .0 generally means that the utility has sufficient income to pay its current debt obligations. Debt obligations such as bond covenants often require specific levels of this ratio, with a DSCR of 1 .0 typically a requirement. For Water operations, Denton's DSCR ranged from 1 .6 to 2.3 from 2015 through 2017 and was lower than the comparator group median. However, it is well above Denton's required coverage level of 1 .25. Debt Ratio is a longer term measure of liquidity; it is the ratio of long-term debt plus current and accrued liabilities to total assets. The target level of this ratio is also generally influenced by the utility's financial policies. For Water, at 32%, Denton's debt ratio is at the comparators' median, but slightly lower than the AWWA statistics. For Wastewater, Denton's debt ratio is 21 %, which is substantially lower (better) than the comparator 75t" percentile and AWWA statistics. This indicates that for both its Water and Wastewater operations, Denton is not highly leveraged. 174 NEWGEN STRATEGIES AND SOLUTIONS, 164 Financial Performance — Operating Margin Water/ Wastewater Operating Margin Denton's ratio of operating income to total Water revenue is just below the comparator's median. A higher number is more favorable as it indicates that a smaller portion of revenue is going to pay operating expenses. Its operating margin indicates that Denton is earning approximately 9 cents for every dollar of Water revenue and 18 cents for every dollar of Wastewater revenue (before debt service and in lieu of franchise fee and return on investment payments). 175 NEWGEN STRATEGIES AND SOLUTIONS, 165 Operational Performance Million Gallons per Customer The MG per water customer ratio reflects the average annual usage for all customer classes served by the utility; it is impacted by the distribution of the types of customers served, as well as factors such as water conservation measures. Denton's ratio is slightly below the comparator's median, but is among the highest usage among the Texas Water utilities. Denton's ratio of MG collected or processed per Wastewater customer is on par with comparator utilities and varied little over the past three years. Productivity Measures Customers per Employee — For both Water and Wastewater operations, Denton's level of productivity as measured by the number of customers serve per employee is well below that of both comparators and AWWA statistics. Million Gallons per Employee — For both Water and Wastewater operations, Denton's level of efficiency as measured by the number of gallons delivered, collected, or processed per employee is well below that of both comparators and AWWA statistics. 176 NEWGEN STRATEGIES AND SOLUTIONS, 166 I OR Vic, ti $ � 1,1311 "1 Jill ►'1�l Benchmarking — Detailed Findings Denton Municipal Electric Financial Performance The following graphs illustrate financial ratios and comparisons, including: Revenue Liquidity Operating margin 178 STRATEGIESNEWGEN • • •: Revenue per kWh All Retail Customers • On a revenue per kWh basis 0,222 —AVnds-Wc40 across all customer classes, ......Med,aa DME's ratio of 11 .3 cents is slightly lower than the average 0.167 and median for the „ lay comparators. 0.15 3 I U 1„ APPA statistics show values ......�:� �... .. ..... ...................... . ........ .... ......................... 8BI well below DME and the comparison group average. O.10 oos, 0.099 0.092 0085 00e3 While revenue per kWh is a 0.056 reflection of the magnitude of 0.05 electricity rates (the effective rate paid by customers), the customer mix, load factor, and 0.00 1 W commodity costs contribute to , 04J � Q � �' ���01 0 �` �yt & differences in this ratio. � • �L �r� qa For this ratio, DME should P° strive for a balance between reasonable rates for customers and sufficient revenue for the utility to sustain itself 179 financially. NEWGEN STRATEGIES AND SOLUTIONS, 169 Revenue per kWh All Retail Customers 3-Year Trend $0.24 ■2015 0 2016 W 2017 Across all customer classes, $0 22 DME's ratio of revenue per kWh shows a moderate $0.20 increase over the previous $0.18 three years. Several of the comparators (BTU, RPU, and $0.16 FCU) exhibit a similar trend. $0.14 I Since variations in revenue per customer can be attributed to Y $0.12 , several factors, including the $0.10 load factor and commodity costs, slight variations over $0.08 time are not a major concern. $0.06 DME's rates have risen slightly over the past three years, $0.04 which has impacted this $0.02 measure. Future increases may require $0.00 - - further analysis to ensure that Denton GP&L BTU GEus NBU BPUB RPU REU FCU rates charged to customers are tracking with power costs. 180 NEWGEN STRATEGIES AND SOLUTIONS, 170 Revenue per kWh Residential 2017 $0-2" 0.185 At approximately 11 cents, $0.18 DME's revenue from residential 0.161 —Average ......Median customers per kWh sold to this $0-16 class is similar to many $0.14 comparators (with the 0.123 exception of the California $0.12 a.��o 0.109 utilities — RPU and REU), the = 0.103......0.105......E ............. ... .. ......... .... .........'... ......... ... ............ o.io50.104 0.106 median value Of the ....... � $0.10 0 091 6.D96 H 0.084 comparator group, and the $0.08 APPA data. $0.06 $0.04 $0.02 $0.00 `or �v Jy @, • QJ �J LJ Jy J`� �y� `a� �ycoo�L r� Alp 7 you PRe PCQP� PQQP 181 STRATEGIESNEWGEN • • Revenue per kWh Residential 3-year Trend $0.20 ■2015 02016 Y2017 As with the slight increase in revenue per kWh across all $0.18 customer classes, DME's revenue from Residential $0.16 customers per kWh sold $0.14 exhibits a small rise over the I past three years. $0.12 ` All the comparators have only slight changes in this ratio over $0.10 the last three years. $0.08 Among the comparators, only Garland Power & Light shows $0.06 M a decline in revenue per kWh ` h ` over the time period. $0.04 I I $0.02 $0.00 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU 182 NEWGEN STRATEGIES AND SOLUTIONS, Revenue per kWh Commercial • "0.22 DME's measure of revenue 0.201 $010 from commercial customers per Average Median$D.I8 kWh sold is 9.9 cents and is 0.160 lower than the comparators $0.1� group average, but slightly $0.14 higher than the median. $0.12 As with this measure for 0.107 0,107.= 0.099 0.100 o.loo residential customers, D M E's $0.10 0.092 0.091 0 088 0,091 0.o88 effective rate for commercial . .................................. . ....... $0.08 0.074 0.067 0.)84 customers is similar to the $0.06 APPA data for similarly sized utilities and is much lower than $o.oa for the two California utilities $0.02 included in this benchmarking. $0.00 AGJy` r��5� �o'o O ��O oJti QQP QQP�p QQP P P P 183 STRATEGIESNEWGEN • • Revenue per kWh Commercial 3-year $0.24 ■2015 M2016 u2017 DME's revenue from $0.22 Commercial customers per kWh sold exhibits a relatively $0.2o flat trend over the past 3 years. $0.18 While number of kWh hours $0.16 sold to DME's commercial customers decreased by $0.14 approximately 7% from 2015 to t S0.12 2017, on a per customer basis, Y the revenue exhibits little $0.10 change over that time period. $0.08 GP&L, GEUS and NBU show f$0,06 slight declines in commercial 1 revenue per kWh sold over the $0.04 three years reviewed. $0.02 $0.00 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU 184 STRATEGIESNEWGEN • • Revenue per kWh Industrial 2017 At 7.8 cents, DME's revenue $o 1r per kWh sold to industrial 0.147 —Average Median customers is above the $0.14 comparator median as well as slightly higher than the effective $0.17 D.116 rate reported by APPA across the U.S. and for similarly sized $0.10 utilities. OD78 0.084 Several of the comparator N $0.08 0.074 D.075 0.074 utilities do not serve industrial $0.06 o.oss customers or do not report 0.048 0.050 sales to industrial customers $0.04 separately from commercial, hence data was not available $0.02 for this graphic. Reports[&I Reports[&I Reports M Combined Combined Combined C"P ,ti� PQQ �Ph� QQP P 185 NEWGEN STRATEGIES AND • • Revenue per kWh Industrial 3-year Trend $0.18 DME's revenue per kWh sold 0201S 02016 92017 to industrial customers shows $0.16 a very small downward trend over the past three years. $0.14 DME's kWh sales to industrial $0.12 customers rose by approximately 3% from 2015 to $0.10 2017. However, on a per kilowatt hour (kWh) basis its revenue from this customer �'$o.os class decreased in 2017 s0.06 compared to the previous 2 years. $0.04 Several comparators (GP&L, and NBU) exhibit a similar $0.02 downward trend in effective ReportsC&1 ReportsC&I ReportsC&I rate for Industrial customers; $0.00 Lj LJ lbd Combined Combined Combined which is frequently an Denton GP&L BTU GEUS NBU 6PUB kFit, REU FCU indication of declining commodity costs. 186 STRATEGIESNEWGEN • • 176 Average Residential Monthly Electricity Bill & Usage Comparison - 2017 1,400 5140 • Average monthly usage and resultant bills based on current electricity rates are shown for $107 1,300 $114 $111 $114 Denton and the Texas $101 comparators. DME's average residential Y 1,200 $86 monthly bill based on average U 1,146 I $80 m monthly usage among DME 1,156 Y customers is similar to bill ,r 1,100 1,1z� amounts for the other Texas c0 ,` 1,114� y / $60 utilities. > Although average monthly > l,000 1,008 $40 residential usage varies substantially, from a low of 848 kWh (GEUS) to a high of 1 ,156 900 kWh (NBU), with the exception of NBU, the average bill is 848 within 15% range. 800 --� Denton GP&L BTU GEUS NBU BPUB �Bill -Usage 187 NEWGEN STRATEGIES AND SOLUTIONS, ELECTRIC Current Ratio — 2017 • The Current Ratio is defined as 16 current assets _ current liabilities 14.39 .,„ , „„ and measures the utility's short-term liquidity. Current assets typically 14 include cash, marketable securities, accounts receivables, and inventories. Current liabilities 12 usually include accounts payable, short-term notes, and accrued to expenses. A ratio below 1.0 may be indicative of cash flow issues, while a ratio of—2.0 or higher suggests s efficient management of working capital. 6.30 • DME's Current Ratio of 2.4 is similar 6 to APPA averages and lower than 4-44 V 4,68 the comparators group median and a 4.02 average. It indicates that the utility 3.32 ssz has sufficient funds to cover short- ...., 2s9_._................_................. _. . i.. 57 2.68............ .......... ' 2.75 2.84 term indebtedness. 2.40 2.15 . 2 2•01 • In order to accommodate paying for expenses with cash (or other reasons for holding significant o — balances in short-term reserves), q4 �J �,S J 5 y� 5� �` some utilities will have higher than CiQ � uk t'Q 0QJ 4� Q4' 4c. �J �6`� ray to` a moo a,� QQ4 average Current Ratios. ¢QQP° pQQP P • Risk management policies may dictate analyzing the level of this measure to ensure liquidity if access to debt financing is limited. 188 NEWGEN STRATEGIES AND SOLUTIONS, ELECTRIC Current Ratio — 3-Year Trend 18 ■2015 2016 Y 241T The Current Ratio for DME ■ declined slightly in 2017 16 compared to the previous two years. 14 The Current Ratio for the 12 majority of comparator utilities _ varies only slightly 10 year-to-year over the past three years. This is an indication that each utility is s adhering to its risk 6 management or other financial policies regarding desired 4 levels of liquidity. 2 0 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 189 STRATEGIESNEWGEN • • 179 BACK ELECTRIC Debt Service • 10 The Debt Service Coverage Ratio (DSCR) is the ratio of net income 8� —Average Median to total long-term debt service for the year; it measures the utility's s ability to meet its long-term debt obligations. z 6.97 At 1 .7, DME's DSCR is lower than for seven of the eight comparators and the APPA E 6 averages. However, it is higher than its 1 .00 DSCR requirement. 4.,;, This ratio is typically influenced o by the utility's financial policies a with a ratio greater than 1 Z 300 meaning that the utility has sufficient income to pay its _.� z 09 current debt obligations. Debt 2 1.71 1.94 2so obligations frequently require f- specific levels of this ratio, with 0.90 bond covenants often requiring a 0.42 DSCR between 1 .0 and 2.0. 0.00 These ratio is also greatly ° influenced by the structure of the mod`• Qom\, m'�J 4,Jy ��J Q,0 �QJ piJ �LJ yJ�' GJ`'� �yw. `a� v �4 � utility with wires-only electric utilities frequently exhibiting PgRV, pQQP higher DSCRs than those utilities with generation assets. 190 NEWGEN STRATEGIES AND • • 180 BACK ELECTRIC Debt Service e — 3-Year Trend 12 02015 02016 Y2017 Since DSCRs may be dictated by bond covenant's and/or fiscal policies, it is not 10 surprising that they do not vary significantly over time. Large increases typically would B occur in years when new debt z is issued; conversely refund or retiring debt could lead to substantial decreases in this measure 0 4 2 INN Hd [J Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 191 NEWGEN STRATEGIES AND SOLUTIONS, ELECTRIC Debt t • Total Assets — 2017 Debt to Total Assets is the ratio of 0.80 long-term debt plus current and —Average ......Median accrued liabilities to total assets. 030 0•709 It is normally Y l) influenced b a utility's financial policies. 0.60 o.s8a At 0.24, DME's ratio is lower than the comparator's average, and the APPA average for utilities in 0.50 0.477 0.474 the southwest U.S., and across An o.4aa ........ 0."4 0.410 the country, but is similar to the 4 0.40 0.300 0.408 ratio for NBU. A 0.331 While low or no debt offers a 0.30 0.286 0.291 certain advantages, debt o.240 financing is often used as a o_2o financial management tool to 0.162 amortize large, long-lived infrastructure costs over the long- 0.10 term (e.g., 20 to 30 years). This 0.023 aligns the cost of the assets to 0.00 their useful lives. Limiting or 041 to 410 100 101 vJl `4� �,.4. �o_1` foregoing debt financing may �¢ A- �r P�Q� result in less predictable rates for 4QQp`�� �QQP customers due to changes in supply costs or high capital costs for major infrastructure projects. 192 NEWGEN STRATEGIES i• SOLUTIONS, ELECTRIC Debt to Total Assets 3-Year Trend 0•80 For most utilities, Debt to Total ■2015 ■2016 0 2017 Assets is a relatively stable 0.70 number; although substantial changes may occur when new 0.60 debt is issued or debt is retired. From a risk perspective, lower 0.50 ratios are considered better r debt ratios (<0.4), while higher debt ratios (0.6+) may make it 0.40 more difficult to borrow money. A D For 2016 to 2017, DME's ratio 0.30 doubled from 0.12 to 0.24 due to the issuance of $$214.9 0.20 million of utility revenue bonds in May 2017. 0.10 ill 0.00 - Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 2015 data not available for NBU 193 NEWGEN STRATEGIES AND SOLUTIONS, ELECTRIC Days Cash Hand 2017 —Average ......Median Days Cash on Hand is another 400 measure of liquidity that rating 360 agencies are typically 350 interested in. It is a measure of how much cash the utility has 30o in relation to its operating 250 expenses. 200 DME has enough cash to cover 119 days of operating ° 150 140 expenses, which is higher than E119 z 93 9, 105 95 both the comparator group 100 median and average. 52 93 50 23 Days Cash on Hand is typically _ IJ ® influenced by the utility's Denton GP&L BTU E 5 NBU BPUB RPU REU FCU LUS financial policies and should (50) promote a balance between maintaining adequate reserves 4ioa) -s8 while also prudently operating (150) the utility. 194 NEWGEN STRATEGIES AND SOLUTIONS, ELECTRIC Days 400 As with other financial metrics, ■2015 ■2016 A 2017 Days Cash on Hand for 350 municipal utilities generally does not vary significantly 300 year-to-year. DME's number of 2so Days of Cash on Hand ranges from a low of 119 to a high of 200 175 over this three year period. N In 2017, GEUS experienced a v iso negative unrestricted cash net E position related to impairment i 100 of prepaid electric costs associated with TMPA , which so results in a negative measure 0L L IOU for Days Cash on Hand. Denton GP&L BTU GE S NBU BPUB RPU REU FCU LUS -50 2015 data not available for NBU -100 195 NEWGEN STRATEGIES AND SOLUTIONS, ELECTRIC Operating Margin — 2017 25% Operating margin is a measure —Average - Median of the proportion of a utility's revenue remaining after paying 2 °Z% °% operating expenses. DME's ratio is similar to the 274`' comparator's median, as well as higher than five of the nine 1546 comparators. Its operating v margin of 7.7% indicates that 11.6% 11.3% DME is earning almost 8 cents °% for every dollar of sales E °% revenue before debt service, °O 7.7% 7.6% ................... ...................................... .......... . ............... ........................... 7.6% capital projects, and transfers 5.8% to the City for return on 5% 4•9% investment and franchise taxes. LJ C�:•nta: GII&L BTU GEUS NBU BPUR RPU REU 1.U5 -1.996 -595 196 NEWGEN STRATEGIES AND • • ELECTRIC Operating 25% DME's Operating Margin has declined from 2016 levels, with a similar trend for BTU. 20% Other Texas utilities have seen a declining over the past three years, including GP&L, GUES, 15� NBU and BPUB. d Modest annual changes in this measure are not typically a 0 1°�° concern; however, trends such 10 as continued declines or substantial drops in the margin 5% over time may highlight rising costs that are not being adequately recovered by rates °� and might warrant rate Denton GP&L BTU GEUS NBU BPUB RPU REu �= '. '�`J increases or conducting a cost of service study. -596 197 NEWGEN STRATEGIES AND SOLUTIONS, Operational Performance The following graphs illustrate operational ratios and comparisons, including: Expenses Kilowatt-hours per customer Reliability 198 NEWGEN STRATEGIES AND SOLUTIONS, 188 ELECTRIC Uncollectible Accounts per Revenue Dollar — 2017 $0.010 —Average ......Median Uncollectable Accounts per $0009 0.0089 Revenue Dollar measures the portion of each revenue dollar $0.008 that will not be collected by the $0.007 0,0070 u t i I i ty. DME's ratio is similar to the $0.006 average for comparators and 0,005i w $DA05 slightly higher than the APPA statistics. $0.004 0.0032 0.0032 0.0035 $0.003 0,0025 0.0020 0.0019 $0.002 _... .... .. ... 0.00115...... ...... ..................._........--- 0.0020 0.0017 0.0015 $0A01 0.0006 $0.000H U 4 Off' J,�r QP QeP�O �QP � P 199 NEWGEN STRATEGIES AND SOLUTIONS, 189 ELECTRIC Uncollectible Accounts DME's ratio of Uncollectible $0008 ■toes ■Zoi6 otos� Accounts per Revenue Dollar $0.007 shows a decline over the three years of 2015 through 2017. $0.006 $0.005 $0.004 $0.003 $O.00Z $0.001 $0.000 Lj LA L,Lj L, LJ Denton GP&L BTU GEUS NBU SPUB RPU REU FCU 20150ata not aval lab le for NBU or REU 200 ELECTRIC A&G Expense per Distribution Mile — 2017 $18,000 The Administrative & General —Average ......Median (A&G) expense per circuit mile of $16,iaz$16,000 distribution ratio measures the utility's A&G expense incurred $14,000 relative to each mile of distribution. A&G expenses are $12,00 $12,073 those costs not allocable to power costs, distribution, or $10,0oo $9,604 $10,009 customer accounting. Items A $8,685 typically include compensation for '"$8,000 Ss,.�at executives, office supplies, ' professional fees, property $6,000 insurance and claims, and >>. , pensions and benefits. $4,000 $3,322 DME's ratio is higher than comparator's average, as well as $2,000 $1128 �1'812$842 higher than all other comparators. ar This ratio is subject to each $- Denton GP&L BTU GEUS Nei RPU REU utility's accounting practices and . i' for multi-service utilities such as BTU, BPUB, RPU, FCU and LUS, A&G expenses may be lower as the costs are shared across 201 electric and water operations. STRATEGIESNEWGEN • • 191 ELECTRIC A&G Expense per Distribution Mile — 3-Year Trend $18,000 DME's ratio of A&G expense per mile of distribution is $16,000 ■2015 ■2016 O 2017 trending upward over the time period of 2015 through 2017. $14,000 $12,000 a $10,000 - $8,000 $6,000 $4,000 $2,000 Flu low UU �1 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 2015 Data Not Available 202 NEWGEN STRATEGIES AND SOLUTIONS, 192 ELECTRIC A&G Expense per Customer — 2017 The A&G expense per $200 customer ratio measures the —Average ......Median utility's A&G expense incurred $600 $604 relative to each customer. A&G expenses are those costs not allocable to power costs, $500 distribution, or customer accounting. Items typically ` $400 include compensation for executives, office supplies, professional fees, property w $300 $253 $243 insurance and claims, and 227 pensions and benefits. $200 $169 DME's ratio is above the group _ $16� 5179 $1�° $16y average and the APPA 1� $106 averages. ............................................... .......... . ..$�a............. $1a6 $57 $43 $aa This ratio is subject to each 1 utility's accounting practices $' ell, �' and for utilities such as BTU C�Q4ty 0�J C9�Jy ��`� �J ��`� 4LJ � �C,�S �� '�o�a ' ,ter Q� RPU and MID, A&G expenses may be lower as the costs are MID data excluded Irom the Average and Median as 11 indudes transmission O&M costs P shared across electric a n d water operations. 203 STRATEGIESNEWGEN • • 193 ELECTRIC A&G ;S ou DME's ratio of A&G expense per customer is also trending upward over the past 3 years. Further increases in A&G expense ratios may warrant ti606 additional analysis. ti o a E N $400 V $300 $200 $100 imi I�j lid III 1 IJ Denton GP&L BTU GEUS NBU BPUB RPU REU FCU 2015 Data Not Available 204 STRATEGIESNEWGEN • • 194 Customer Accounting/Service/Sales Expense per ELECTRIC The Customer Accounting, Service, and Sales ratio $160 —Average ......Median measures the utility's customer- $143 related expenses incurred $140 relative to each customer served. Customer expenses typically include customer service center, $120 meter reading, billing, key $106 accounts, credit and collections, $100 $99 and uncollectable accounts. This $96 $92 ratio is subject to each utility's $93 accounting practices and if $80 services are shared across multiple utility services. $60 lities may $52 $60 be able tola'chie achieve economies of $47 scale. $40 At $52, DME's ratio is well below the comparator's average and $20 median, but similar to the APPA statistics for like-sized utilities and Cot—enp—. the U.S. overall. $ ::ot reoarrcd y� y a� Being below average in this �Q ' �° �� �� expense can be a false economy ° ti PQQP if customer-facing services are rated low by customers. Many of the comparator utilities do not report their Customer service expenses. 205 STRATEGIESNEWGEN • • 195 Customer Accounting/Service/Sales Expense per Customer — r Trend ELECTRIC DME's ratio of Customer $180 Accounting, Service, and Sales ■ S57 $- $- $tsa S-.. $16o expense per customer is exhibiting an downward trend $140 from 2015 through 2017. $120 a $100 E 0 u $80 $60 $40 $20 Customer ..Pens..nor Customer expenses not reported Customer expenses not reported reported $ Denton GP&L BTU GEUS NBU BPUB RPU REU FCU 206 NEWGEN STRATEGIES AND SOLUTIONS, 196 ELECTRIC Kilowatt per • 2017 45,000 The kilowatt hour (kWh) per —Aecragc �,eb customer ratio demonstrates 40,000 38,919 average annual usage for all 35,767 customer classes served by the 35,000 utility. This is typically a 30,795 reflection of the distribution of Z9,6Z4 30,000 27 g2z 27,10S the types of customers served. z6z�,�za.. ........... .... ......,... .... .......... ... ........... ... ........................................................... .. At almost 28,000, DME's ratio 25,000 27,105 is slightly above the 20,115 20,670 comparator's average and 20,000 16,834 median. 15,000 10,000 5,000 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 207 STRATEGIESNEWGEN • • 197 ELECTRIC Kilowatt Hours per Customer — 3-Year Trend 45,000 DME's ratio of kWh per ■2015 U 2O16 v 2O1i customer is trending downward 40,000 over the time period of 2015 through 2017. 3 5,000 Most other utilities (with the 30,000 exception of BPUB and RPU) also show a downward trend in 25,000 electric usage per customer. Across the U.S., the trend is Y 20,000 toward declining load growth even in the face of expanding 1.5,0OO customer base. • From 2015 to 2017, DME saw 10,000 a 3.7% growth in the number of accounts served, but only a 5,000 3.0% growth in kWh sold. Hi lu - ILUJU Denton GP&L BTU GEUS NBU BPUB RPU REU FCU 208 NEWGEN STRATEGIES AND SOLUTIONS, •: ELECTRIC Residential KWH per Residential Customer - 2017 At approximately 16,OOD 12,000 kWh sold in 2017, —Average ......Median DME's ratio of kWh sold per 14'OW 1346A 13753 13869 13,369 residential customer is slightly .:: ....................................... ............... ................................................................... 13,365 above the comparator's 12,d93 12,000 average, but below the median. - 11.51. 1 0 9,637 The average amount of 10,0W electricity sold per residential t customer is typically impacted Y 8,000 7.497 7,612 by the housing mix (single 600o family vs. multi-family), size of homes, number of members 4,WO per household, as well as solar installations and energy 2,000 efficiency measures enacted. Denton GP&t BTU GEUS NBU BPUB RPU REU FCL. 209 NEWGEN STRATEGIES AND SOLUTIONS, 199 ResidentialELECTRIC per Residential Trend ■2015 0 2016 u 2017 DME's ratio of kWh sold per 16,000 residential customer is declining slightly over the time 14,000 _ f period of 2015 through 2017. Annual variations can occur 12,000 based on extreme weather conditions (such as an 10,000 unusually hot or cold summer) or changing housing trends 3 8,000 such as increased energy efficiency measures or roof-top 6,000 solar. 4,000 2,000 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 210 STRATEGIESNEWGEN AND • • 200 ELECTRIC Commercial KWH per Commercial Customer - 2017 130,WO At approximately 165,sn 53,000 kWh sold in 2017, 160"o DME's ratio of kWh sold per 146,338 Commercial customer is below 140,000 the comparator's average and 1z2,Z39 median. 120,000 102,323 However, several utilities report 500000 combined commercial and Y RRS. industrial customer numbers and usage (GEUS, BPUB and °°° -- -- -- -- - - --- -- ----�, 7-- — E3Sna LUS). The average usage 53,Z20 without those 3 utilities is 40,669 4°,000 - displayed on the graph 20,160 (-64,000). 20,000 Usage by customer class is _ I impacted by how each utility Denton GP&L BTU GEUS Ngu BPU8 RPu REU defines its classes. —Average ......Median Average without combined Commercial/Industrial 211 NEWGEN STRATEGIES AND SOLUTIONS, 201 CommercialELECTRIC Commercial KWH per i Trend ■2015 LA 2016 LA z017 DME's ratio of kWh sold per 180,000 Commercial customer, as well as the ratio for most 160,00o comparators is little changed 140,000 over the time period of 2015 through 2017. 120,000 100,000 s 80,000 60,000 40,000 20,000 11 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 212 NEWGEN STRATEGIES AND SOLUTIONS, 202 ELECTRIC Industrial KWH per Industrial Customer — 2017 510.000,000 Med{an—�Avers®e At over 4 million kWh sold in ��•��� 47 2017, DME's ratio of kWh sold 45,000.000 per Industrial customer is well 40.000,000 40 Q9 33 3�,996i23] below the comparator's average and median. 35,000,000 As previously noted, how each utility classifies customers impacts these customer class .... ................................................................- . . ......_ . . . . . . ratios. Several of the Y �s,aaa,000 comparators that show high �p,00e, levels of usage on a per customer basis only classify a 1s,00a,aoo few (<20) customers as 13,507,385 "Industrial." 1o,aaa,000 51000,000 4,194,384 ... 1.145.578 945,12A Aerer�[vnimd LLt B ® mn�[m..kd[81 Denton GP&L ..•u NBLI 8P116 RPU FlEII FCiI LI15 213 NEWGEN STRATEGIES AND SOLUTIONS, 203 IndustrialELECTRIC r Trend i 02015 M2016 U2017 DME's ratio of kWh sold per 50,000,000 Industrial customer, as well as 45,000,000 the ratio for most comparators is little changed over the time 40,000,000 period of 2015 through 2017. Large changes to this ratio 35,000,000 typically occur if large industrial 30,000,000 customer with high load factors either enters or leaves a serve 3 25,000,000 territory. 20,000,000 15,000,000 10,000,000 5,000,000 Re Aeport minds Reports cvmined ed C&I .mined C&I comined C&I Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LU5 214 NEWGEN STRATEGIES AND SOLUTIONS, 204 ELECTRIC Customers Served per Employee Average ---Median DME's ratio of number of 600 554 customers served per employee is lower than the 500 comparator average and 456 median, but higher than the 409 APPA averages. This ratio is a 400 measure of workforce LL productivity. 307 31J. 31r, 307 This ratio is influenced by the 261 232 227 mix of customer types and C population density. It is also 200 174 f 170 169 influenced by the extent that 128 employees are shared with 100 other (non-electric) departments or operations. 0�1 4J� le e QQPh� PQQP P 215 NEWGEN STRATEGIES AND SOLUTIONS, 205 ELECTRIC Retail Megawatts Hours Sold per Employee Another measure of 16,000 15,923 productivity is amount of electricity sold per employee. 14,000 Average ———Median DME's ratio of number of megawatt hours of electricity sold per employee is in line 12,000 10,965 11,443 with the comparator average and median. 10,000 9,21 7 This ratio is influenced by 589 0 customer mix and load factors. 7 8,000 , For example less than 1 % of Y NBU's customers are industrial 6,000 (13 customers), but their usage v 4,708 4,657 is over 40% of megawatt hours 3,938 4,137 4,000 NBU sells. I L� I L-- j i, 2,000 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 216 NEWGEN STRATEGIES AND SOLUTIONS, 206 ELECTRIC Energy • The Energy Loss percentage is 8.0% the ratio of total energy losses 7.Zz�'' to total sources of energy; —Average -n is,+�,„ It 70�° measures how much energy is 6.0% lost in the utility's electrical system and indicates the 4.97% 4.99;5, efficiency of the system. The �'0% losses include physical losses N 4.08% 3.72% occurring in the distribution 4.0% 3.71% o ' 3.4S% 3.58/ system as well as metering and ........... .. ......... ........ .......... ......................... . 3.32% 3.0% 2.74% 3.45% r-11 3.00% billing losses. z34°", 3.320 o At approximately 5% DME's 2.°�° ratio is above the comparator's 1.63'0 median and average, as well 1.0% as higher than the APPA statistics. 0.0% Li Ll This level of losses warrants a loss study to determine the source(s) of these losses. 217 NEWGEN STRATEGIES AND • • 207 ELECTRIC Energy Loss — Trend DME's ratio did not vary 18.0% significantly over the prior 3 ■zais ©zo>t� a zoi� 9 Y years. 16.0% Of the utilities included in the study, only BPUB shows a 14.09�o significant difference year-to- 12.0% year. 10.0% a 8.0% 6.0% 4.0% 2.0% Lj Denton GP&L BiU GEUS �-JW. BPUB RPU REU F[U LUS 218 NEWGEN STRATEGIES AND SOLUTIONS, 208 System Reliability The following graphs illustrate reliability indices, including: SAIDI (System Average Interruption Duration Index) SAIFI (System Average Interruption Frequency Index) 219 STRATEGIESNEWGEN • • 1• SAIDI & SAIFI — Calendar Year 2018 SAIDI 900 For 2018, DME's SAIDI index is substantially better than that of APPA Region 4 utilities and similarly sized utilities comparators; while its 7Q0 SAIFI index is similar to APPA comparators. 600 5Q0 SA I F 2 400 300 1"08 213.6 2Q0 1 0 100 56.2 _ U.`t 0 Ci.65 Denton Utilities in Region 4 Same Customer Size Utilities -` 0.h 1 1 0.7 0.0 Utilities in Region 4 Same Customer Size Utilities Note: The 2018 comparators differ from those in previous yeA�s NEWGEN STRATEGIES AND SOLUTIONS, SAIDI Calendar Year 2017 DME's SAIDI measure (number 70 Average (Mean) of minutes of system average ••••• Median interruption duration index) for 60 60.12 58.78 2017 is higher than its comparators. 51.20 50 45.99 45.00 40 38.80 38.8 3 36.4 30 22.37 20 15.00 15.95 10 4 I 0 _ Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 221 NEWGEN STRATEGIES AND SOLUTIONS, SAIDI 3 Year SAIDI Age of infrastructure, the 80 3-Year Trend utility's level of emphasis on regular maintenance and vegetation policy as well as 70 percentage of underground distribution lines typically impacts these reliability indices. For example, FCU's distribution system is over u 90% underground which maybe reflected in its low 30 SAIDI results. 20 10 f 0 W! W W BTU GEU5 NBU BPtI'. ■2015 m1016 02017 222 NEWGEN STRATEGIES AND • • SAI Calendar Year 2017 1.2 —Average(Mean) ——— Median - DME's SAIFI measure (number 1.089 of times of system average 1.031 interruptions) is considerably 1.0 0.960 0.990 higher than the comparators. 0.8 CV E f0.6 u 0.500 0.523 —————————————— —————— — D.490 04 0 0.4 0.330 0.256 0.279 ji 0.2 0.`08'1 0.0 Li Li L-1 Denton GP&L BTU GEUS NBU BPUB RPU REU FCU LUS 223 NEWGEN STRATEGIES AND SOLUTIONS, SAIR 3-Year DME's SAIFI measure (number of times of system average interruptions) is considerably higher than the comparators. f a.o , Denton GP&L BTU GEUS NBU BPUB RPLJ RtU LJ ■2015 it 2016 rJ 2017 224 NEWGEN STRATEGIES AND SOLUTIONS, `Jr s ruNlllll�l�� low � 1-F o- _� fir._ 4� _=w• _�'=- Benchmarking Detailed Findings Denton Water Utility 225 Financial Performance Water The following graphs illustrate financial ratios and comparisons, including: Revenue Liquidity Operating margin 226 STRATEGIESNEWGEN • • • WATER Revenue per Million Gallons of Water Sold - 2017 25viPs�Hr ----Mddm 75thPernm6w. On a revenue per million 510,000 9,677 gallons (MG) basis across all customer classes, Denton's 59,wo ratio of $5,705 is higher than S8,000 7,467 the 75t" percentile of the C S7,000 $6,311 comparators. 3 S6,000 $5,705 While revenue per MG is a ,6,000 4,916 5�1?3 reflection of the magnitude of J water rates (the effective rate 4,481 Sa 000 __�3- --- __ _ ____ ---3,409--- ____ _ ____ _ 3 741 paid by customers), the >3,000 '409 customer mix and commodity $2 000 costs contribute to differences in this ratio. S1,000 Greenville's revenue value is for combined water and a ,� �� QJ �� `,� 2�. wastewater operations. d 0` For this ratio, Denton should look to achieve a balance 1=Owns Wastewater Treatment only between reasonable rates for Greenvtlle reports combined revenue for Water and Waste-waster services,so u 2,Owns Water Production and Wastewater Treatment NOt included in the median) 3-Owns WaterProduuron Only customers and sufficient 4-Does notOwn Water Production or Wastewater Trearment revenue for financial sustainability. 227 NEWGEN STRATEGIES AND SOLUTIONS, WATER Revenue per Million Gallons Sold - Trend Across all customer classes, $io,000 Denton's ratio of revenue per $9,000 MG shows a moderate $8,000 increase over the previous three years. Several of the 9 0 $7,00o comparators (Greenville, $6,000 Frisco, and McKinney) � $5,000 exhibit a similar trend. s $4,000 f Since variations in revenue per customer can be $3,000 attributed to several factors, $2,000 including commodity costs, $1,000 slight variations over time IN III III III III III III III Ili are not a major concern. OP \,�� \tip `�� `tip \tiz �ti� \A� `�� ��,, Future increases may oer ``a�� ���-� �;`e ��J �QJ� ¢off i`s�o \��e� `�;� require further analysis to ensure that rates charged to customers are trackingwith 1.Owns Wastewater Treatment orh 2=Owns Water Prooucnon and Wastewater I reatment water supply costs. 3-Owns WaterProducWn Only 4-Does not Own Water Production or Wastewater treatment ■2015 ■2016 0 2017 228 NEWGEN STRATEGIES AND SOLUTIONS, WATER : Average Residential Bill for 7 , 500 Gallons Usage • For residential customers served by a S7�Y�RPS1YIlTiafRillt4f4"Y��40POfV �M(RR�1NSPIV4P7JMfpP'RP:+IPIIT3I14�•'fiCllr �7SmPP!(PttTIn'���Merllan �752hPeTtPgfdr 3/4-inch service connection, Denton's $60 87 water bill for 7,500 gallons of usage is $60 - higher than for six of the Texas-based comparators as well as above the �47.13 47.44 $48.45 AWWA Region IV average. However, city of Garland residential bill for usage $40 $3s 72 of 7,500 gallons is over 25% higher than $33.70 $33.36 $35.70 Denton's. 3 S� 29.Oi 27.65 24.43 s=9.o1 All the Texas water utilities in this study offer incline block tiered rates for at least s20 part of year, but the size of the blocks 16. Sls.na _ . r 51�.sz sl"'' s1 and associated rates vary widely. $lfl 7.6 Lowest Tier Rate Highest Tier Rate $° Denton $ 4.15 $ 10.90 CA Ne- �p�, d Gar a n a e a Q $ 4.77 $ 9.22 BTU $ 2.76 $ 3.50 Greenville $ 3.45 $ 4.37 P� N B U $ 1.55 $ 5.43 BPUB $ 1.98 $ 4.08 Round Rock 2.56 5.77 Frisco $ 3.92 $ 6.78 McKinney $ 4.40 $ 6.60 229 Grand Prairie $ 4.04 $ 7.24 STRATEGIESNEWGEN AND • • 219 WATER Current Ratio - 2017 18 17.6 The Current Ratio is defined as current assets = current 16 liabilities and measures the —25th Percentile ----Median - — 75th Percentile 14 water utility's short-term 12 liquidity. Current assets �,v typically include cash, 10 marketable securities, accounts s B receivables, and inventories. J 6 5.8 Current liabilities usually 4.2 4.0 4.8 include accounts payable, 4 ----- ---- ---- ---- 4,0z short-term notes, and accrued 5 2 1.7 2, expenses. A ratio below 1 .0, � may be indicative of cash flow ° issues, while a ratio of —2.0 or Q\ �ti� Qti� 0 eA e higher suggests hi h efficient ,bJ J� o�� Cr `�� < e4A �Q a�- �`' � Qua management of working capital. Denton's Current Ratio of 4.2 is 1=Owns Wastewater Treatment Only 2=Owns WaterProduction and Wastewater Treatment slightly higher than the median, 3=Owns WaterProduclton Only a.Does not Own WaterProducnon or Wastewater Treatment and it indicates that the water utility has sufficient funds to cover short-term indebtedness. 230 NEWGEN STRATEGIES AND SOLUTIONS, 220 WATER Current Ratio - Trend 30 The Current Ratio for Denton declined slightly in 2017 25 compared to the previous year. The Current Ratio for the majority 20 of comparator water utilities varies only slightly year-to-year over the past 1� three years. This is an indication that each utility is adhering to its 10 risk management or other f financial policies regarding E desired levels of liquidity. v C However, McKinney saw a significant decrease in its Current 0 Liabilities from 2015 to 2016, o� QVI `�� �S\ leading to a substantial increase �� 0QJ rya°` ���`'`' c�\� Q,T`` in its Current Ratio. In order to accommodate paying for expenses with cash (or other 1=owns wastewater Treatment Only reasons for holding significant 2=Owns WaterProductlon and Wastewater Treatment ■�ois ■zoi6 ozei� 3�Owns Water Produriton Only balances in short-term reserves), 4-Does not Own Water Produmon or Wastewater Treatment some utilities will have higher than average Current Ratio. 231 NEWGEN STRATEGIES AND SOLUTIONS, BACK WATER Debt Coverage Ratio 2017 10 The Debt Service Coverage $,74 Ratio (DSCR) is the ratio of net income to total long- term debt service for the —25eh Pereenl(le - Med Eon 75th Percentile year; it measures the utility's ability to meet its E G long-term debt obligations. 9 5.24 m m At 1 .99, Denton's DSCR is 4 �.04 3� �� lower than the 25t" 3.29 323 percentile of comparators, 2.57 but above the AWWA Zia 2 1.99 1.84 overall average (mean). Additionally, it is higher than 0.93 the water operations' 1 .25 0 DSCR requirement. Demon Garland 12) BTU(2( Greenville 121 NBU(2) BPUB{2) Round Rock lidsco)4) McKinney(41 Grand Prairie AWWA Overall AWWA- M (3) Kegion IV 232 NEWGEN STRATEGIES AND SOLUTIONS, BACK WATER Debt u Since DSCRs may be dictated by bond covenant's and/or 10 fiscal policies, it is not surprising that they do not vary z significantly over time. a 8 m 0 This ratio is typically influenced by the utility's financial policies 6 with a ratio greater than 1 z meaning that the utility has 4 sufficient income to pay its current debt obligations. Debt obligations frequently require Z specific levels of this ratio, with bond covenants often requiring o a DSCR between 1 .0 and 2.0. Denton Garland(1) BTU(2) Greenville(2) NBU(2) BPUB(2j Round Rock(2) Frisco(4) McKinney(4) Grand Prairie (3) 0201S O2016 -2017 a-noes eao.a ware.v�mumo�orwazz..arerireavnen� 233 NEWGEN STRATEGIES AND SOLUTIONS, WATER Debt Ra - 20 •-25th Percentile ---•rAcmiln 75th Percentile The Debt Ratio is defined as 60% total liabilities = total assets 53% and measures the utility's level 50% 48% of indebtedness. The higher the debt ratio, the more 40% 35% 37% 39�D 37% dependent the water utility is 32% - __ _ 37`•� on debt financing. -- --------- ------ j 2$ p� Denton's Debt Ratio of 32% is 30% 25 22% • 20% close to the benchmark 20% median, not as low as the 75t" percentile of comparators. It is 10% also lower than the AWWA--- --- averages (mean). This 0% indicates that the Denton water 0 �J13" J0\S\ �w`�� °`°� Q.,tA� `''� �s'� ,a,�, utility is not overly leveraged. O a�� � ens e� �Q dP ,�� �t�a Qua �� �Q�<� ��°� �` ,,,,�a P ,F_ • Additionally, according to the 2018 AWWA study, Denton's I=Owns WastewaterIreatmentOnly debt ratio is slightly better than 2=Owns Wa ter Production and Wastewater Treatment 3=Owns WaterProduclton Only the median based on 50 water •_Does not Own Water Production or Wastewater Treatment utilities who participated as • 25 th shown in the table. PercentilePercentile 32% 20% 53% 50 234 STRATEGIESNEWGEN • • WATER Debt - Trend 60% The Debt Ratio for Denton declined in 2017 compared to 50% the previous years. The Debt Ratio for the 40% majority of comparator utilities varies only slightly 300,;., year-to-year over the past three years; which is typical except in years in which new debt is issued or debt is refunded. Due to its stable cash flows, utilities frequently operate 0% with a debt level of JQIN �ti� J��\ �`' �`ti� ���� ��p' approximately 40%. However, some municipal utilities elect to either forgo 1=Owns Wastewater Treatment Only issuing debt or use limited 2-Owns Wa ter Productlon and Wastewater Treatment debt financin , which results ■2015 ■2016 ■2017 s-Owns Water Pruduuton Only g •=Does not Own Water Produmon or wastewater Treatment in very low debt ratios. 235 NEWGEN STRATEGIES AND SOLUTIONS, WATER Operating Margin — 2017 • Operating Margin is a measure Z50r Percelttlle ----Median —75th Percentile of the proportion of the water 40% utility's revenue remaining after paying operating expenses. ro /° 3' 30.5% • Denton's ratio is higher than the 30% comparator's median. Its 25% 24.0% operating margin of 9.1% i indicates that Denton is earning Z0% just over 9 cents for every dollar #,39� 1A,6°� of sales revenue before debt 15% service, capital projects, and 9.1% 5.9% 8.9% 8.59� s.�� 10% ______ ____ ___________ ____ transfers to the City for return on 4- Not investment and franchise taxes. 5% Available 5.5% • Operating margin for Greenville 0% (shown as blue bar) is based on ° �o� ��� `tip ��1 `:P QIN �� �a� `'` combined water and wastewater -5/o oe�� �ac� ��J ���� ��J QJ0 Q.�`� �.`�'o �re� �X` operation financials. ac �r 0 Q� -10% vie Aos ' % �`act� • The Frisco water utility shows a negative operating margin as it had negative operating income 1=Owns Wastewater Treatment Only 2=Owns WaterProductlon and Wastewater Treatment (loss) that appears to be due to s-Owns WaterProduclton only non-cash transactions. 4-Does not Own Water Production or Wastewater Treatment 236 STRATEGIESNEWGEN • • 226 WATER Operating 50% Denton's Operating Margin has declined from 2015 levels, with a similar trend for Frisco and Grand 40% Prairie. Modest annual changes in 300/6 this measure are not i typically a concern; however, trends such as a 2090 continued declines or substantial drops in the E margin over time may 10% highlight rising costs that are not being adequately recovered by rates and 0% Not d might warrant rate Available increases or conducting a o�JQI\ �`ti� ���� Q �`�� ��ti, cost of service study. a�a �J �� -1096 �� ' The Frisco water utility shows a negative operating 1=Owns Wastewater Treatment Only 2.Owns Waterproducw and Wastewater Treatment margin in 2017 as it had ■2015 02016 o2017 3=Owns WaterOroduoton ONy negative operating income 0-Does not Own Water Pmduchan a Wastewater Treatment (loss) in that year. 237 NEWGEN STRATEGIES AND SOLUTIONS, Operational Performance The following graphs illustrate operational ratios and comparisons, including: Customers per employee Million gallons delivered per employee 238 NEWGEN STRATEGIES AND SOLUTIONS, WATER Million . • per • 2017 —25th Percentile .......Median 75th Percentile 0.25 At approximately 156,000 gallons sold in 0.203 2017, Denton's ratio of 0.20 0.186 million gallons sold per 0.174 0.174 1 0.177 customer is slightly 0.1% higher than the o.ia9 0.141 comparator's median y Y.1�.�............ 0.131 and below the 75t" percentile. U 0.101 The average amount of water sold per customer is typically impacted by 0.05 the mix of customer classes, as well as water conservation 0.00 ' — measures enacted. Denton Garland BTU(2) Greenville NBU(2) BPUB(2) Round Frisco(4) McKinney Grand (1) (2) Rock(2) (4) Prairie(3) 1=Owns Wastewater treatmern Ord/ 2.Owns Water Pl dudw and Wastewater Ireament 3.owns Water ertcki n ONy a.Does not Own Water nrowlw.a Wastewater treatment 239 NEWGEN STRATEGIES AND SOLUTIONS, 229 WATER Million Gallons per Customer — 3-Year Trend Denton's ratio of MG per customer has remained relatively consistent over the time period of 2015 through 2017. - Several other Texas water U 15 utilities have exhibited an increase in per customer usage (Garland, BTU, BPUB, 0.10 Round Rock and Grand Prairie), while others 0.05 (Greenville and Frisco) show a downward trend in water usage per customer. 0.00 - - Denton Garland BTU(2) Greenville NBU (2) BPUB(2) Round Frisco (4) McKinney Grand (1) (2) Rock(2) (4) Prairie(3) 1.0wns Wascewacerlreatmmt Only 2=0wns Water Pmdulvon and Wastewater Treament 32 Owns Waters wo "n Onry At Does not Own Water Production or Wastewater Treatment 240 NEWGEN STRATEGIES AND SOLUTIONS, 230 WATER Retail Customer Accounts Served per Employee - 2017 15o1 Pa—I— ---*%IaJ 75th Pffmmtilc The customer per employee ratio 1,200 demonstrates productivity, with 1,043 higher numbers of customers per 1,000 employee indicating more efficient operations. However, this `1 measure is also a reflection of goo �`' 726 how services are shared across a municipal organization. For some e 600 559 548 548 LL Z. ___ _________T_ _______________ ___ _ ___- S45 water utilities, activities such as customer service and billing are 400 358 368 374 394 staffed outside the utility which 0 would lead to higher productivity zoo 155 indices. • Denton's ratio using the adjusted _ number of employees (to remove `0 `S �til ��� 1� `tip �ti� �a1 ��� ��� �a�l ��� shared services staff counts, FTE o�� `ca �,�� `JN,e J ��- y�o ��� ��e ore = 97) is to just under the 25tn v� ��e� °`��•a ��� `��Q �ysP �?' percentile and the AWWA averages (mean). It Owns WastewaterTreatmerrt Only For the utilities shown as blue I-Owns Wa ter Productlon and Wastewater Treatment bars, this ratio is based on to the 3=Owns Water Produclton Only 1-Uoes not Own Water Production or Wastewater Treatment total number of FTEs in both Water and Wastewater operations. 241 NEWGEN STRATEGIES AND SOLUTIONS, WATER Million Gallons per Day Delivered per Employee - 2017 —25th Percentile ----Median — 75th Percentile The ratio of system throughput to number of 0.50 employees is a common high- 0.45 0.43 level measure of productivity. However, this measure is also 0.40 a reflection of how services 0.35 are shared across a municipal 0.35 organization. For some water 0.28 utilities activities such as 0.30 0•27 0.28 customer service and billing 0.25 0.23 oz3 O.Z3 are staffed outside the utility 0.20 - 0.20 which would lead to higher 0.15 productivity indices. 0.15 Denton's water utility 0.10 0.08 0.08 productivity of 150,000 f gallons per day delivered per 0.05 iJ the adjusted number of employees (FTE = 97 - after removing shared services Q\` `tip Qti� N31 `�� ��, �'' �a� ` staff Is slightly below the �N¢ �J J� ��- L0 �� ��e Je �� ) g Y r, aka e", h � Qt0\ aP ��� comparator 25 percentile and lower than the below AWWA averages (mean). This measure may also be 2-Owns Wastewater I reatment Only impacted by climate and 2-Owns Water Production and Wastewater Treatment water conservation measures 3:owns water Produciton Only implemented. A-goes not Own Water Produc�ion or Wastewater Treatment 242 NEWGEN STRATEGIES AND SOLUTIONS, -,; low -- -Am- MOO � 1 Benchmarking — Detailed Findings Denton Wastewater Utility Financial Performance Wastewater The following graphs illustrate financial ratios and comparisons, including: Revenue Liquidity Operating margin 244 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Revenue per Million Gallons - 2017 25th Percentile ......•Median —75th Percentile • On a revenue per million $9,000 gallons (MG) of wastewater $8,000 $7,669 collected or processed basis across all customer classes, $7,000 Denton's ratio of $5,653 per $6,000 $5,653 million gallons is higher than $4,995 776 $4,849 the 75t" percentile of $S,CIGG .......:................... ....... ...... .......... comparators. $4,000 $3,573 • Revenue per MG is the effective rate paid by $Z,s54 customers; however, it is $2,000 impacted by the customer mix and commodity costs. $1,000 Not Not Available Available • For this ratio, Denton should $� balance reasonable rates for 0��\ ,�� �` � `��3� customers with achieving �Q ��� ,�s Qca sufficient revenue for the �`aca utility to sustain itself entO 1=Owns WastewaterTreatm * financially. 2=Owns Wa=roduct,or+ and Wastewater treatment 3=Owns_WawProducxon Only 4�Does not Own Water Production or wastewater treatment 245 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Revenue per Million Gallons Processed - 3-Year Trend Across all customer classes, $8,000 Denton's ratio of revenue ' per MG shows a slight $7,000 increase over the past three years. $6,000 Variations in revenue per y customer can be attributed 3 $5,000 to several factors, hence small changes over time are $4,000 not a major concern. Denton a $3,000 adjusted its wastewater rates in October 2017, which $2,000 likely accounts for the increase. $1,°00 Not Future increases may Available Nal Available require additional review to $ Denton Garland BTU (2) NBU (2) BPUB (2) Round Frisco (4) McKinney confirm that rates charged to {1) Rock(2) (4) customers are aligned with 1-owns Wastewater 1 reatment Odu nty wastewater costs. 2015 Y 2016 y'017 z-Owns WaterProcwn and wastewater treatment 3=Owns WaterProducrton OnN 4=Does not Own Water Production or Wastewater treatment 246 NEWGEN STRATEGIES AND SOLUTIONS, 236 WASTEWATER Average Monthly Residentialfor 11 Gallons Usage2017 Monthy Service Charge 25thPercentile ---Median 75thPercentile $70 65.64 For residential customers, Denton's average monthly $60 wastewater bill for 7,500 gallons of usage is $39.50 $51.48 which is slightly higher than the $50 $46.08 �1 25t" percentile and lower than $47.43 O $ 9 the median among $4Q,3a______-- _ ---- 40.95 $39.50 ---------------- -" s42.39 comparators. It is also similar $40 $38.11 $38.70 $38.55 to the AWWA average bill for Y $33.37 Region IV. 3 $30 The fixed cost recovery 25.44 component of the wastewater $20 `� rates varies from a low of $6.55 $15.31 $16.52 $16.60 for Garland, to a high of $25.44 1= �1 for Frisco. As with the overall $10 $11.00 U$7.88 bill, Denton is again in the $6.55 $7 48 middle of the range with a $o customer service charge of Denton Garland BTU NBU BPUB Round Frisco McKinney Grand AWWA $11 . Rock Prairie Region IV 247 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Current Ratio - 2017 —25th Pe►centile ......•Median — 75th Percentile The Current Ratio is defined as 20 current assets = current liabilities 18 17.6 and measures the water utility's short-term liquidity. Current 16 I assets typically include cash, marketable securities, accounts 14 receivables, and inventories. 12 Current liabilities usually include accounts payable, short-term 10 9.8 notes, and accrued expenses. A ratio below 1 .0, may be indicative $ 6.1 �dL of cash flow issues, while a ratio 6 of -2.0 suggests efficient 4.0 management of working capital. ...............3:r.......... ........... .......... ..........4.84 41 4 Denton's Current Ratio of 6.1 is L9 2 higher than the comparator median and close to the 75th 0 percentile; it indicates the water or �11:> `ti1 �ti� ��� �ti� �a� �� �1 utility has sufficient funds to cover ,�J �J J� `o ea short-term indebtedness. 3�OD �' �Q a�cf' ��`y � <a` Ratios for NBU and BPUB are for the entire utility operations (electric, water, wastewater), ratios for Round Rock, Frisco, 1=Owns Wastewateructlon and Only McKinney and Grand Prairie are 2=Owns Water Production and Wastewater Treatment 3=OwnswaterProduuton Only for the combined water and 4=Does nat Own WaterProducaan or Wastewater Treatment wastewater operations. 248 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Current Ratio - 3-Year Trend The Current Ratio for Denton 30 increased each year from 2015 to 2017. 25 The Current Ratio for the majority of comparator 20 wastewater utilities varies only slightly year-to-year over the is past three years. This is an 1 t indication that each utility is 10 adhering to its risk management or other financial di S policies regarding desired e levels of liquidity. a ° In order to accommodate paying for expenses with cash a J J �� �J �QJ ° �..•`' Qua`` (or other reasons for holding o� �a significant balances in short- ' c�`3 term reserves), some utilities I.OwnsWastewater Treatment only will have higher than average ■ 2=Owns Water Production and Wastewater treatment 3-Owns Water Produciton Only Current Ratio. A=Does not Own Water Production or Wastewater treatment 249 NEWGEN STRATEGIES AND SOLUTIONS, 239 WASTEWATER Debt - 20 25th Percentile ......•Median 75th Percentile The Debt Ratio is defined as 60% 6%/o 44 total liabilities = total assets 4.8% and measures the wastewater 50�a � r_i utility's level of indebtedness. aa� The higher the debt ratio, the 40% 33% 34%0 more dependent the 30% 29°0 299/628% wastewater utility is on debt 30% ........ .. ....................... . ...................... .. ...... 21 % u 28% financing. , I j 20/a 20% Denton's Debt Ratio of 21% is better than the 75t" percentile 10% as well as below the AWWA averages (mean). This 0% � indicates that the wastewater Q� `�� `�� `�, °� A`°� c�, e�lb °ca utility is not overly leveraged. � P 2=Owns Wastewater Ireatment Only 2=Owns Water Production and Wastewater 1 reatment 3�Owrn Water Produciton Onry 4=Does not Own Water Production or Wastewater treatment 250 NEWGEN STRATEGIES AND SOLUTIONS, 240 WASTEWATER Debt The Debt Ratio for Denton's 50% wastewater system declined in 2017 compared to the previous years. 40% The Debt Ratio for the majority of comparator water utilities 30% varies only slightly a year-to-year over the past ,E three years; which is typical 3 20% except in years in which new debt is issued or debt is refunded. 10% Due to its stable cash flows, utilities frequently operate with 0% a debt level of 40%. However,Denton Garland(1) BTU (2) NBU (2j BPUB (2) Round Frisco (4) McKinney some municipal utilities elect to Rock(2) (4) either forgo issuing debt or use 1:Owns Wastewater 7reatmento* limited debt financing, which 2 owns Wate1Production and Wastewater Treatment results in very low debt ratios. 3=Owns WaterProducrton Ordr 4=Does not Own Water Producbon or Wastewater treatment 251 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Operating Margin - 2017 25% Operating Margin is a 21.996 measure of the proportion of 25th Percentile .......Median —75th Percentile 20% 18.2% the wastewater utility's revenue remaining after 16.3% paying operating expenses. 15% 3.1�"�;, Denton's ratio of 18.2% is 1 above the 75t" percentile. Its r u 10% ....... ................... .8:�%...... ...............8.9�9b.......... �o z�, operating margin indicates a e.3% that Denton is earning just over 18 cents for every CL 5% dollar of sales revenue 0 y 8.5 before debt service, capital 0% projects, and transfers to "ot the City for return on Oc \,� \�� Table \`�+ �� �Q �� �c'� �a `0 �a e investment and franchise 0 -5% O Ga`a 0 �' aQ �a�� ���h ��� aQ�3� taxes. The Frisco wastewater utility -10% shows a negative operating -9.9% margin as it had negative 1r Owns Wastewater I reatment Only operating income (loss) that 1.Owns Water Production and Wastewater treatment 3-Owns WaterProduuton Only appears to be related to 4-Does not Own Water Production or Wastewater treatment non-cash transactions. 252 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Operating 30% Denton's Operating Margin has exhibited only slight variations 25% over the past three years. Modest annual changes in this 20`Y° measure are not typically a concern; however, trends such 15% as continued declines or substantial drops in the margin c over time may highlight rising 10% - costs that are not being adequately recovered by rates al 5 Not and might warrant rate Available ' 6 L increases or conducting a cost 0% o of service study. Denton Garland BTU (2) NBU (2) BPUB (2) Round Frisc ) McKinney ° (1) Rock (2) (4) The Frisco wastewater utility �5°�° shows a negative operating margin in 2017 as it had negative operating income I=Owns Wastewater treatment Unly 2=Owns Water Production and Wastewater treatment (loss) in that year. ■2015 ■2016 N 2017 k Owns Water Produciton only 4-Does not Own Water Production or Wastewater treatment 253 NEWGEN STRATEGIES AND SOLUTIONS, Operational Performance The following graphs illustrate operational ratios and comparisons, including: Customers per employee Million gallons delivered per employee 254 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Million • per • 2017 035 At approximately —25th Percentile .......Median 75th Percentile 168,000 gallons in 2017, 0.30 0.304 Denton's ratio of MG per wastewater customer is 0.25 slightly higher than comparators' 75t" percentile. v 0.20 The average amount of 0.168 0.156 wastewater collected or u 0.15 0.156 processed per customer is L\7 typically impacted by the 0.10 0A93 0.092 0.093 92 mix of customer classes as well as weather events such 0.05 as heavy levels of rainfall. 0.00 Denton BTU(2) BPUB(2) Round Rock(2) Frisco(4) Grand Prairie(3) I-0=Wan2w Tma -t only 2<Owns Water orpd artl Watt-- treat—, 3=Owns Water 11W11 Nn 0" 4-0——0—Water croG—d Wastewater Ireatmem 255 NEWGEN STRATEGIES AND SOLUTIONS, WASTEWATER Million • per • mer — 3-Year Trend 0.35 Denton's ratio of MG per wastewater 0.30 customer has remained relatively 0.25 consistent over the time period of 2015 0.20 through 2017. a E 0 +r u 0.15 0.10 U.U5 0.00 Denton 6 T U (2) BPU6 (2) Round Rock (2) Frisco (4) Grand Prairie(3) 1+Uwn5 Wastewater Treatnem Only 1.Owns Water Preducnon and Wattewater Treatment 3=[hyns Water Pmdu lion Only E 2015 0 2016 V 2017 4-Does not Own Water Production or Wastewater Treatment 256 NEWGEN STRATEGIES AND SOLUTIONS, 246 WASTEWATER Retail Customer Accounts Service per Employees - 2017 25th Percentile ----Median -75th Percentile The customer per employee ratio 1000 948 demonstrates operational efficiency. Higher numbers of 900 customers per employee indicate •• higher levels of productivity. soo However, this measure is also a 700 666 reflection of how services are fill - , 654 613 shared across a municipal 600 ----- __-- --------_-- ---�g----------- 584 511 organization. For some wastewater utilities, activities E soo 525 such as customer service and a s 400 366 billing are staffed outside the utility which would lead to higher 9 300 productivity indices. 200 155 At 366, Denton's ratio using an _ adjusted number of employees to ioo ' `�ab�°ot Not remove staff providing shared "la Available services (FTE = 89) is below the 0 - comparator's 25t" percentile as o� `�� `tip �ti� `tip `tip `� `a� �s,� `a�� `� well as lower than the AWWA o w o A �e. e averages (mean). oe a �� �� QQJ This measure may be impacted by how the wastewater operation allocates for shared services as 1=Owns Wastewater Treatment Onw well as whether or not 2-Owns Water Production and Wastewater treatment maintenance crews maintain 3�Owns Wateroroduoton onty lower-lateral sections of the 4=does not Own Water 1Rnduction or Wastewater Treatment sewer line (from the customer cleanout to the collector). 257 STRATEGIESNEWGEN • • WASTEWATER Million Gallons Processed per Employee - 2017 25th Percentile ----Median — 75th PercentilE The million gallons processed per employee ratio demonstrates 0.60 average annual usage for all 0.52 customer classes served by the 0.50 wastewater utility. However, this measure is also a reflection of 0.41 how services are shared across a 0.40 0.33 0.39 municipal organization. For some LL wastewater utilities, activities 0.30 such as customer service and ---- ----------------- ------------------- 0.23I 0.2 billing are staffed outside the - utility which would lead to higher o.zo o.i o Y g 0.13 0.14 productivity indices. 0.10 �J 13 The ratio of system throughput to Not0•� rwt number of employees is a o.00 Available Available common high-level measure of `�� `�� \� ��� \�� \�� \Q� `�� `\� productivity or efficiency. �a �J 0J J� �� � �`e, ,�a `o��� Denton's wastewater utility o A�Km 0 �Q a4 ��� .� Q`a• P �o� productivity of 160,000 gallons Q �.� �� a�� P processed per adjusted number q c,� P �� of employee (to remove shared services staff numbers, FTE _ 1-Owns Wastewater treatment Only 89) is higher than the 25t" 2-Ow,s Water Production and Wastewater treatment 3=Owns WaterProducitvn Only percentile of gallons processed, 4=Does not Own Water Production or Wastewater treatment but slightly below the AWWA averages. 258 NEWGEN STRATEGIES AND SOLUTIONS, �a s = o. Y... O 259 Appendix A Persons Interviewed Kenneth Banks General Manager of Utilities Smith Day Regulatory& Risk Division Manager George Morrow General Manager of Denton Municipal Electric Stephen Johnson Market Operations Manager Brent Heath Executive Manager of Energy Delivery Mary Dickinson Business Manager Toni Puente Finance Director Kathy Brooks Electric Budget Manager Rusty White Electric Safety&Training Supervisor David Gaines Assistant Finance Director Jason Brown Power Plant Manager Jose Gaytan Energy Analytics Manager Brad Watts Operations Line Superintendent Kyle Thompson Power Plant Maintenance Supervisor Jerry Fielder Engineering Div Manager- Distribution Mike Wilson ERCOT Settlement& Rate Administrator JR Richardson Metering Superintendent Elizabeth Ruiz Energy Programs& Key Accounts Admin Fara Emadi Engineering Services Manager Kevin Griffin Power Plant Operations Supervisor Jerry Looper System Operations Manager Minh Tran Compliance Officer Sam Bridges Substation/Transmission Superintendent Michael Looper Electric Distribution Foreman Chuck Sears Engineering Div Manager-Transmission Bobby King Electric Distribution Senior Lineman Rowdy Patterson Distribution Line Superintendent 260 STRATEGIESNEWGEN • • 250 Appendix A — Persons Interviewed (cont'd) David Clark Water Production Superintendent David Brown Wastewater Collections Manager Kirt Behrens Water Meter/Cross Connect Control Manager P. S. Arora Wastewater Director Susan Croff Process Control/QC Auditor Brian Smith Water Plant Manager Daniel Parish Water Utilities Coordinator Kent Conkle Superintendent Water/Wastewater Alberto Lopez Construction Projects Mgr Todd Estes Capital Projects Casey Bowles Water Distribution System Mgr Tony Puente Utilities Finance Administrator Tim Fisher Water Director Cassandra Ogden Director of Procurement and Compliance Tyler Dawson Field Service Technical Manager Frank Pugsley Deputy Director Water/Wastewater Frank Pugsley Deputy Director Water/Wastewater Melissa Kraft IT Director Rusty Willard Wastewater Reclamation/Beneficial Reuse Mario Canizares Assistant City Manager Nick Vincent Utility Business Manager Todd Hileman City Manager Tiffany Sherrane Wastewater Utility Coordinator Bryan Langley Deputy City Manager 261 NEWGEN STRATEGIES AND SOLUTIONS, 1 Appendix B - Documents Reviewed 2015-GEUS-Audited-Financial- GEUS 2017 Annual Rpt.pdf 16 FY 17-18 Budget&CIP.pdf Exhibit 3-Contract.pdf FY-2014-15-1st-Quarter-Financial- Statement.pdf GPL2015AnnuaI Report.pdf 2012-13-Budget.pdf Expenditure Actuals for Five Years Report.pdf 2016-2017 Approved Budget GPL2016AnnuaI Report.pdf 2012-13-CAFR.pdf 2013-2017.xlsx FY-2014-15-2nd-Quarter-Financial- GreenvilleTX GPL2017AnnuaI Report.pdf 2013-14-Budget.pdf FF and RO1 Actuals-FY 2013- Report.pdf 2016-2017 CAFR-City of Greenville 2015 CAFR.pdf 2013-14-CAFR.pdf 17.xlsx FY-2014-15-3rd-Quarter-Financial- Greenville Greenville 2016 CAFR.pdf 2014-15-Budget.pdf Franchise Fee Memo 091318.docx Report.pdf 2016-GEUS-Audited-Financial- LCG_2017_CAFR.pdf 2014-15-CAFR.pdf FY 13-17 CIP Budget&Actuals.xlsx FY-2014-15-4th-Quarter-Financial- Statement.pdf NBU CAFR 2017 FINAL.pdf 2015-16-Budget.pdf FY15-164th-Qtr-Report- Report.pdf 2018-19-Utility-Rate-Denton.pdf NBU_2018-Consumer-Confidence- 2015-16-CAFR.pdf electronic-copy.pdf FY-2015-16-1st-Quarter-Financial- 2018-2019 PROPOSED Report Water.pdf 2016-17-Budget.pdf FY16-17 2nd-Quarter-Financial- Report.pdf BUDGETGreenvilleTX.pdf Redding_CAFR_FYE 2015.pdf 2016-17-CAFR.pdf Report.pdf FY-2015-16-2nd-Quarter-Financial- BPUB_FY2017_2018 Budget.pdf Riverside_2017_Financial 2017-City-of-Denton-CAFR.pdf FY16-174th-Quarter-Financial- Report.pdf BPUB2017_CAFR_FINAL.pdf Report.pdf Adopted-Cover-Page-and- Report.pdf FY-2015-16-3rd-Quarter-Financial- BrownsvillePublicUtilitesCAFR_20 Attachment 2 Electric Water WW expend itu res.pdf FY16-17 Website-3rd-Quarter- Report.pdf 16.pdf Funds.pdf AIS FINANCIAL STRATEGIES 2017 Repo rt-Aug-24.pdf FY-2015-16-4th-Quarter-Financial- Bryan_TX_FY_15_CAFR.pdf Copy of DME Vehicle Data FINAL 012417.docx FY17-18 1st-Quarter-Financial- Report.pdf Bryan_TX_FY_16_CAFR.pdf 12.19.18.xlsx Attachment 1 Solid Waste Report.pdf FY-2016-17-1st-Quarter-Financial- Bryan_TX_FY_17_CAFRv2 Copy of Historical Actuals 12 to Fund.pdf FY17-18 2nd-Quarter-Financial- Report.pdf City of Garland 2016-17 Adopted present 08-01-18.xls Attachment 2 Electric,Water,WW Report_1.pdf FY-2016-17-2nd-Quarter-Financial- Budget.pdf 2017 Safety Awards of Excellence Funds.pdf FY17-18 3rd-Quarter-Financial- Report.pdf City of Garland 2017-18 Annual Annual Report Form(002).pdf Budget Instructions FY 18-19 12- Report.pdf FY-2016-17-3rd-Quarter-Financial- Operating Budget.pdf DME SAFETY INCIDENT RATES.xlsx 11-17.doc FY-2012-13-1st-Quarter-Financial- Report.pdf CityofReddingCAFRFYE2016.pdf Electric Denton Benchmark data City-of-Denton-2018-19-Proposed- Report.pdf FY-2016-17-4th-Quarter-Financial- CityofReddingCAFRFYE2017.pdf 20181120.xlsx Budget.pdf FY-2012-13-2nd-Quarter-Financial- Report.pdf Denton 2014-15-CAFR.pdf Q17 DME long rept091308. City-of-Denton-Annual-Program- Report.pdf Revenue Actuals for Five Years Denton 2015-16-CAFR.pdf ppt.ppt of-Services-FY-2017-18.pdf FY-2012-13-3rd-Quarter-Financial- 2013-2017.xlsx Denton FY17-18 3rd-Quarter- 2018 DME Historical Peak Loads City-of-Denton-APoS-FY-2016- Report.pdf Exhibit 1.FY2016-17 UTILITIES Financial-Report.pdf Since 1960.PNG 17.pdf FY-2012-13-4th-Quarter-Financial- FINANCIAL STRATEGIES,FINAL, Denton_2015-16-CAFR.pdf 2018-19 CIP Listing.xlsx Debt-Report-09-30-13.pdf Report.pdf 060316.docx Denton_2017-CAFR.pdf 2019 CIP Feeder Imp Debt-Report-09-30-14.pdf FY-2013-14-1st-Quarter-Financial- Exhibit 2.FY2017-18 revised FY15 City Of Garland CAFR.pdf 20180412.pdf Debt-Report-09-30-15.pdf Report.pdf UTILITIES FINANCIAL STRATEGIES, FY16 City of Garland CAFR.pdf Construction Report 20180830.pdf Debt-Summary-Report-17-46- FY-2013-14-2nd-Quarter-Financial- 012417.docx FY17 City of Garland CAFR.pdf Copy of System Studies& 022117.pdf Report.pdf Exhibit 3 Financial Strategies Garland FY 2018-19 Proposed Analysis.xlsx Debt-Summary-Report-18-47- FY-2013-14-3rd-Quarter-Financial- PRESENTATION Final 020117.pptx Budget.pdf Final 2019 CIP RCA Map.pdf FINAL.pdf Report.pdf 01 FY 18-19 Organizational Chart Garland Texas-Water Rates.pdf 16 Exhibit 3-FY 2017-18 Electric DME 2014 Rates(2).pdf FY-2013-14-4th-Quarter-Financial- 071818.ppt Garland Texas-Water Utilities.pdf Revised CIP.pdf DME-Financial-Overview.pdf Report.pdf 01 FY 18-19 Organizational Chart 262 071818.pptx STRATEGIESNEWGEN AND • • Appendix B - Documents Reviewed (cont'd) 01 FY 18-19 Organizational Chart 2017 and 2018 DME Area TM CB 16SSWG_2018_SUM1_U1_Final_1 16SSWG_2022_SUM1_U1_Final_1 17SSWG_2023_SUM1.sav 0718181.pptx Operation Summary.pdf 0152016_DME_FERC715_DEC.sav 0152016_DME_FERC715_Load_SE 17SSWG_2023_SUM1_Load_SEN.r 01 FY 18-19 Organizational Chart 2017 Outages.xlsx 16SSWG_2018_SUM1_U1_Final_1 N.raw aw 0718182.pptx 2017 Reliability [FINAL V2_31.pptx 0152016_DME_FERC715_DEC_SP 16SSWG_2022_SUM1_U1_Final_1 17SSWG_2023_SUM1_Load_SEN.s 01 FY 18-19 Organizational Chart 2017.12.05 final Denton N.raw 0152016_DME_FERC715_Load_SE av 0718183.pptx Renewable Resource Plan 16SSWG_2018_SUM1_U1_Final_1 N.sav 17SSWG_2024_SUM1_28SUM- 11-14-06 DME Salaries TO T v1.4.docx 0152016_DME_FERC715_DEC_SP 16SSWG_2023 SUM1_U1 Final 1 DEC OFF.raw Edgar.xls 2018 Outages(1st Qtr-Clean).xlsx N.sav 0152016_DME_FERC715_2027.sav 17SSWG_2024_SUM1_28SUM- Comments-Distribution 7-19-18 369MW peak.pdf 16SSWG_2018_SUM1_U1_Final_1 16SSWG_2023_SUM1_U1_Final_1 DEC_OFF.sav Engineering.docx Comments-Transmission 0152016_DME_FERC715_Load_SE 0152016_DME_FERC715_2027O.r 17SSWG_2024_SUM1_28SUM.raw Copy of Distribution Project Engineering.docx N.raw aw 17SSWG_2024_SUM1_28SUM.sav Tracker-MasterNewest.xlsx Council Presentation-September 16SSWG_2018_SUM1_U1_Final_1 17SSWG_2019_SUM1- 1-FERC Form 715 Report Denton DME.doc 19,2017.pdf 0152016_DME_FERC715_Load_SE DEC_OFF.raw Transmittal Letter.pdf DME draft ppt report 072708.ppt DME system outage report N.sav 17SSWG_2019_SUM1- 2017 DentonOneLine.pdf DME draft ppt report 072708.pptx 2017.doc 16SSWG_2020_MIN_U1_Final_10 DEC_OFF.sav 2017_DME_FERC-715_Breaker DME Executive Summary(V3)- EIA Reliability_2015.xlsx 152016_DME_FERC715.raw 17SSWG_2019_SUM1- Rating Adequacy with previously surveyed EIA Reliability_2016.xlsx 16SSWG_2020_MIN_U1_Final_10 DEC_OFF_LOAD_SEN.raw Assessment_Final_03302017.docx organizations.pdf Exhibit 1-Agenda Information 152016_DME_FERC715.sav 17SSWG_2019_SUM1- 2017_DME_FERC-715_Breaker DME Executive Summary(V4a)- Sheet.pdf 16SSWG_2020_MIN_U1_Final_10 DEC_OFF_LOAD_SEN.sav Rating Adequacy without Austin and CPS.pdf Exhibit 2-Resource Planning and 152016_DME_FERC715_Load_SEN 17SSWG_2019_SUM1.raw Assessment_Final_03302017.pdf DMECAM.doc Power Supply Strategy Report 10- raw 17SSWG_2019_SUM1.sav 2017_DME_FERC715_Report_wor FY 18-19 Organizational Chart 24-17.pdf 16SSWG_2020_MIN_U1_Final_10 17SSWG_2019_SUM1_Load_Sen.r king_Final_03302017.docx 071818.pdf Exhibit 3-Presentation.pdf 152016_DME_FERC715_Load_SEN aw 2017_DME_FERC715_Report_wor Summary Sept 29 2017 with Feeder loading data on Peak sav 17SSWG_2019_SUM1_Load_Sen.s king_Final_03302017.pdf Historical Market Delta(Incld.AE 2018.xis 16SSWG_2022_SUM1_U1_Final_1 av 2017_July-System Topology.pdf and CPS).pdf FY17-18 ESTIMATE DEC Monthly 0152016_DME_FERC715.raw 17SSWG_2021_MIN.raw 2018 DentonOneLine.pdf Summary Sept 29 2017 with Proforma.pdf 16SSWG_2022_SUM1_U1_Final_1 17SSWG_2021_MIN.sav 2018 FERC Onelines-DME.pdf Historical Market Delta(WITHOUT Outages 2016 V3.xlsx 0152016_DME_FERC715.sav 17SSWG_2021_MINLoad_SEN.raw 2018 FORM 715 Submission.pdf AE and CPS).pdf Peak Loading Analysis 2018.docx 16SSWG_2022_SUM1_U1_Final_1 17SSWG_2021_MINLoad_SEN.sav 2018 July OneLine.pdf by-18-denton.tx-start#2-E7-TCEQ- Transformer loading data on Peak 0152016_DME_FERC715_DEC.raw 17SSWG_2023_SUM1- 2018 July Topology.pdf Report.pdf 2018.xis 16SSWG_2022_SUM1_U1_Final_1 DEC_OFF.raw 2018 July Topology-DETAIL A.pdf 09-11-17 DME Savings Model 04_050115.doc 0152016_DME_FERC715_DEC.sav 17SSWG_2023_SUM1- 2018 July Transmission System Review-Final.pdf 16SSWG_2018_SUM1_U1_Final_1 16SSWG_2022_SUM1_U1_Final_1 DEC_OFF.sav Topology.pdf 12-11-17 DME Report-Flnal.pdf 0152016_DME_FERC715.raw 0152016_DME_FERC715_DEC- 17SSWG_2023_SUM1- 2018 July Transmission System 2016 Distribution System 16SSWG_2018_SUM1_U1_Final_1 SPN.raw DEC_OFF_LOAD_SEN.raw Topology-Detail A.pdf Reliability Study.pdf 0152016_DME_FERC715.sav 16SSWG_2022_SUM1_U1_Final_1 17SSWG_2023_SUM1- 2018_DME_FERC715_Report_328 2016 EOY Reliability Report.pdf 16SSWG_2018_SUM1_U1_Final_1 0152016_DME_FERC715_DEC- DEC_OFF_LOAD_SEN.sav 2018.pdf 0152016 DME FERC715 DEC.raw SPN.sav 263 17SSWG 2023 SUM1.raw 2020 Jan.DentonOneLine.pdf STRATEGIESNEWGEN AND • • Appendix B - Documents Reviewed (cont'd) 2021 DentonOneLine.pdf Appendix B-Maximum Deviations APPENDIX F- APPENDIX H- Denton Area Substation 2021_July-System Topology.pdf -Flatstart Run.pdf PLOTS_2020HWLL_LOAD PLOTS_2024SP_BASECASE.pdf Relays.pdf 2022 DentonOneLine.pdf Appendix C-ERCOT Planning SENSITIVITY.pdf APPENDIX H- Denton Area System OneLine-7- 2022 July OneLine.pdf Guide.doc APPENDIX F- PLOTS_MITIGATION_2024SP_BAS 6-2018.pdf 2022 July Topology.pdf Appendix C-TPL-001-4.pdf PLOTS_MITIGATION_2019SP_LOA ECASE_CCT.pdf DME-Phase I Report-Final Draft 2022 July Topology-Spencer Appendix D-2018HWLL-Dynamic D SENS_CCT.pdf APPENDIX H- Rev 3.pdf Area.pdf Events.xlsx APPENDIX F- PLOTS_MITIGATION_2024SP_BAS DME E&OT Strategic Plan V2-4 2027 DentonOneLine.pdf Appendix D-2018SUM-Dynamic PLOTS_MITIGATION_2019SUM_L ECASE_OOS.pdf (final).pdf 2-FERC Form 715 Introduction- Events.xlsx CAD SENS_OOS.pdf Appendix I-2023SUM.pdf DME_Surround_15DSB_2018SUM Cityof Denton.pdf Appendix D-2018SUM_GENSENI Appendix G-2018SUM-GEN Arturo Guardado-Load Analysis _P2-P4.con 3- -Dynamic Events.xlsx SENSITIVITY CASE- (VALUES).xlsx DME_Surround_15DSB_2020MIN_ 2018_DME_FERC715_Report_328 Appendix D-2018SUM_GENSEN2 1_3Ph_P4+P5_CCT.pdf CEII P18SP.raw P2-P4.con 2018.docx -Dynamic Events.xlsx Appendix G-2018SUM-GEN CEII P18SP.sav DME_Surround_16SSWG_2018_P 3- Appendix D-2022SUM-Dynamic SENSITIVITY CASE- CEII P19SP.raw 1-ERCOT_1-P7.con 2018_DME_FERC715_Report_328 Events.xlsx 1_P4+P5_SLG.pdf CEII P19SP.sav DME_Surround_16SSWG_2018SU 2018.pdf APPENDIX D-Events_2019SP.xls Appendix G-2018SUM-GEN CEII P20MN.raw M_Extreme_Events.CON 4- APPENDIX D- SENSITIVITY CASE- CEII P20MN.sav DME_Surround_16SSWG_2022_P 2017_DME_FERC715_Stability_Re Events_2020HWLL.xls 1_P4+P5_SLG_CCT.pdf CEII P20SP.raw 1-ERCOT_1-P7.con port_Final.pdf APPENDIX D-Events_2024SP.xls Appendix G-2018SUM-GEN CEII P20SP.sav DME_Surround_16SSWG_2022SU 4- Appendix E-2018HWLL.pdf SENSITVITIY CASE-1-1.pdf CEII P21MN.raw M_P2-P4.con 2018_DME_FERC715_Stability_Re Appendix E-2018SUM.pdf Appendix G-2018SUM-GEN CEII P21MN.sav DME_Surround_17SSWG_19_P1- port.pdf APPENDIX E- SENSITVITIY CASE-1-2.pdf CEII P21SP.raw N-1-1_First.con 5-2018_DME_FERC-715_Breaker PLOTS_2019SP_BASECASE.pdf APPENDIX G-PLOTS_2019SP_GEN CEII P21SP.sav DME_Surround_17SSWG_19_P1- Rating Adequacy Assessment.docx APPENDIX E- SESITIVITY.pdf CEII P22SP.raw N-1-1_Second.con Aaron Woods-Commercial Load PLOTS_2020HWLL_BASECASE.pdf Appendix H-2018SUM-GEN CEII P22SP.sav DME_Surround_17SSWG_2019_P Analysis.xlsx APPENDIX E- SENSITIVITY CASE-2-1.pdf CEII P23SP.raw 1-ERCOT_1-P7.con Appendix A- PLOTS_MITIGATION_2019SP_BAS Appendix H-2018SUM-GEN CEII P23SP.sav DME_Surround_17SSWG_2019SU DWG_Procedure_Manual_Revisio ECASE_CCT.pdf SENSITIVITY CASE-2-2.pdf CEII P24SP.raw M_Extreme_Events.CON n_10.doc APPENDIX E- Appendix H-2018SUM-GEN CEII P24SP.sav DME_Surround_17SSWG_2019SU Appendix A- PLOTS_MITIGATION_2019SP_BAS SENSITIVITY CASE- CIP Map 2019-2023 Landscape M_P2-P4.con DWG_Procedure_Manual_Revisio ECASE_OOS.pdf 2_3Ph_P4+P5_CCT.pdf (1).pdf DME_Surround_17SSWG_2021MI n_10.pdf Appendix F-2018HWLL- Appendix H-2018SUM-GEN CIP Schedule Summary.xlsx N_Extreme_Events.CON APPENDIX B- LOADSEN.pdf SENSITIVITY CASE- CityofDentonStrategicPlan.pdf DME_Surround_17SSWG_2021MI MaxDeviationsv33_2019SP.pdf Appendix F-2018SUM- 2_P4+P5_SLG.pdf Cody Tenorio-Load Analysis.xlsx N_P1-N-1-1_First.con APPENDIX B- LOADSEN.pdf Appendix H-2018SUM-GEN Copy of Transmission and Fiber DME_Surround_17SSWG_2021M1 MaxDeviationsv33_2020HWLL.pdf APPENDIX F- SENSITIVITY CASE- Inventory List.xlsx N_P1-ERCOT_1-P7.con APPENDIX B- PLOTS_2019SP_LOAD 2_P4+P5_SLG_CCT.pdf Denton Area Circuit Breaker DME_Surround_17SSWG_2021MI MaxDeviationsv33 2024SP.pdf SENSITIVITY.pdf 264 Nameplate Data.pdf N P2-P4.con STRATEGIESNEWGEN AND • • Appendix B — Documents Reviewed (cont'd) DME_Surround_Single_Transform Short Circuit ADMIS Owner ID Supplement.pdf City of Denton TX OB GTY(EEI) EDF EEI.pdf er_20168UM_A-1+N-l.con Report_181NR0013_Final_010420 ADMS Confidentiality (06.19.14)XD(06.19.16).pdf EDF Guarantee.pdf DME_Surround_Single_Transform 17.pdf Agreement.pdf City Secretary Certificate- EEI Master.pdf er_2019UM_A-1+N-1.con Small Area Study 2017-For Jerry Arbitration.pdf CONFIDENTIAL.pdf Electronic Trading Disclosure.pdf DRAFT_2018 FORM 715 of (VALUES ONLY).xlsx Authority to Transact- Clevest Trouble WorkOrder tickets F Arco Substation Infra Red ERCOT.docx Stability_Report_18INR0013_1216 CONFIDENTIAL.pdf from distr PM patrols r.pdf Inspection.pdf Entire GIS Assets Inventory 2016_Final.pdf B Cooper Creek Substation COD W9.pdf First Amendment FINAL 06152010 20180829.xlsx Stability_Report_181NR0013_1216 Checkout Summary G2ETC.doc Collateral Annex.pdf Signed .pdf ERCOT Planning Guide- 2016_Final_Updated.pdf Bluebell II PPA.pdf ConocoPhillips.pdf FW ADM Clearing Account 04_050115.doc Steady_State_Study_Report_181N Bluebell Power Purchase Controller Identification Paperwork.msg ERCOTDD.xIs R0013_11232016_Final.pdf Agreement.pdf Supplement.pdf FW First Amendment To Guaranty Final_2017 FORM 715 of ERCOT Substation Transformer Data 8-27- Broker Agmt DME Amerex Cover Letter to James Lierman 6 3 -Nextera.msg cover letter.pdf 2018.pdf FINAL.pdf 2016.doc FW_Denton-NewGen Final-Substation and Transmission Substations Operated by DME 8- Broker Agmt DME Atlas FINAL.pdf Cover Letter to Linda Cole 118 Request.pdf CIP 2019-2023 RevAHE.xlsx 27-2018.pdf Broker Agmt DME BGC Financial 2018.doc G Arco 15kV 220 and 221 Breaker Future 2022 July Transmission System Map.pdf FINAL.pdf Credit Support Annex.pdf Testing and Maint.pdf System Topology.pdf Transmission Lines 8-27-2018.pdf Broker Agmt DME Bosworth Customer Account Application.pdf Garland EEI Master.pdf Future 2022 July Transmission 138kV TM Line Vegetation Mgmt FINAL.pdf Customer Agreement.pdf GIS Distr Device Inspections 7-23- System Topology-Detail A.pdf Inspection Woodrow to Broker Agmt DME BTU FINAL.pdf D Woodrow Substation Building 2 12.xis Load Analysis.xlsx McKinney.pdf Broker Agmt DME ICAP FINAL.pdf Battery Charger Testing.pdf Hedge Account Oak Area StudyDocl.docx 2014 CONTROLLER Broker Agmt DME TFS FINAL.pdf DENTONFINAL4.20.09.pdf Representation.pdf OAK GATEWAY AREA PLAN- IDENTIFICATION-1.pdf Bryan EEI Master.pdf Designation of Signature.pdf Howard Martin Photo ID.pdf 36x36.pdf 2014 CONTROLLER Bryan Langley Photo ID.pdf Distribution ATO monthly I SF6 Substation Breaker Gas plots_bind_BF_2018HWLL+DEC.pd IDENTIFICATION-2.pdf C McKinney Substation Building 1 logsheet inspection r.pdf Testing r.pdf f 2014 CONTROLLER Batteries Testing.xls DME EEI Collateral_para 10 ICE OTC Participant Agreements- plots_bind_BF_2018SUM+DEC.pdf IDENTIFICATION-3.pdf CC McKinney Substation Building 3 v2.0.docx ORIGINAL AGREEMENTS.msg plots_bind_N11_2018HWLL+DEC. 2014 CONTROLLER Batteries Testing.xls DME EEI Master v2.0.docx IFUS Participant Agreement pdf IDENTIFICATION-4.pdf Centrica Guarantee DME Enforceability Legal 8.12.16(DME 3.10.17).pdf plots_bind_N11_2018SUM+DEC.p 2014 CONTROLLER Agreement.pdf Opinion.pdf III Substation Transformer Oil and df IDENTIFICATION-5.pdf Citigroup Energy Collateral DME MSCG Collateral Annex.pdf Dissolved Gas Testing r.pdf plots_bind_NC_2018HWLL+DEC.p 2014 CONTROLLER Annex.pdf DME MSCG EEI Master.pdf Infra Red Transformer and 600A df IDENTIFICATION-6.pdf Citigroup Energy EEI.pdf DME_TrailStone Group CA TBody Inspection r.pdf plots_bind_NC_2018SUM+DEC.pd 2017 COD TAX EXEMPT Citigroup Energy Guarantee (Revised TrailStone Comments Inspector Tabular Screenshots.doc f FORM.DOC Agreement.pdf 6.16.17).docx ISDA Master Agreement.pdf plots_bind_remedial_BF#9_2018H A Weekly Substation Inspection City of Denton SENA and STRM DTE Final Contract.pdf J Relay Testing.pdf WLL+DEC.pdf Sheet Samples.pdf Certificates.pdf E Woodrow Substation Building 2 Janet Granger Letter 3-20-18.doc plots_bind_remedial_BF#9_20185 ADMIS Customer Account City of Denton SENA Guaranty Batteries Testing.pdf K RDW Building 3 Battery UM+DEC.pdf Application.pdf Final 12-6-17.dc pdf EDF Collateral Annex.pdf Discharge Testing.pdf STRATEGIESNEWGEN AND • • Appendix B — Documents Reviewed (cont'd) Keira Kazmerski Cover Letter 8-12- Santa Rita Executed Contract.pdf 07 Condemnation-Project 20 Construction-Substation ERM Procedure CR-03 Credit Risk 2016.doc SCOA Guaranty_City of Denton Execution Process Part 1_II-Rev Project Execution Process-Rev Calculations.pdf LCRA EEI Master.pdf dba Denton Muni Elec_102915.pdf 3.pdf 1.pdf ERM Procedure CR-04 Credit LCRA-W9-Form.pdf SENA Collateral Annex.pdf 08 Closing-Project Execution 2018 DME Black Start Plan Version Portfolio Administration.pdf List of Items DME Routinely SENA Master Agreement.pdf Process-Rev 1.pdf 1.doc ERM Procedure GC-01 Approved Inspects in Substations.pdf Shell Trading Risk Management 09 Relocation-Project Execution 2018 Emergency Operations Plan Transaction Types.pdf NAESB Contract with Enterprise- W9 2018.pdf Process.pdf (5).docx ERM Procedure GC-02 Transaction FINAL.pdf Special Entity Schedule.pdf 10 Planning-SUP-Project Control Center Backup Plan Approval Process.docx NAGP EEI 7-14-14.pdf Tenaska Confidentiality Execution Process Substation-Rev 2018.docx ERM Procedure GC-02 Transaction NAGP EEI Master Signed 7-14- Agreement.pdf 2.pdf Copy of DME DG PV Unit Approval Process.pdf 14.pdf Tenaska EEI CS+Collateral Annex 10027065-HOU-R-01-0 Report Listing.xlsx ERM Procedure GC-03 Model NextEra Second Amendment to 07 01 2015.pdf Final.pdf CPI-Contingency Plan 2018.docx Validation Change Control.pdf PPA FINAL EXECUTED.pdf Tenaska Guarantee.pdf 11 Planning-SWPPP,Clearing& DME AssetLife Workflow.pdf ERM Procedure MR-01 Market Noble Credit Risk Position 1-8- Tony Puente Photo ID.pdf Grading Permit-Project Execution DME Load Shed Plan Report-2018 Risk Exposure Methodology.pdf 16.xlsx Trading Disclosure-2.pdf Process Substation-Rev 3.pdf Final.docx ERM Procedure MR-02 Forward Noble Guarantee Agreement.pdf Tree Trimming Circuit Feeder 12 Planning-Fence Permit- DME Processes List.pdf Price Curves.pdf Northern States Power Company Yearly Progress.xls Project Execution Process DME Switching Procedure ERM Procedure MR-03 Portfolio Collateral Annex.pdf Updated Transacting Authority Substation-Rev 3.pdf 2016V3.pdf Risk Exposure Limits.pdf Northern States Power Company Memo.docx.pdf 13 Planning-Building Permit- DME System Operations Process ERM Procedure MR-04 Risk EEI.pdf Utility Special Representation Project Execution Process docx Models and Metrics.pdf Online Account Access Letter.pdf Substation-Rev 4.pdf DME System Peak by Substation ERM Procedure MR-05 Non- Application.pdf 01 Purchasing-Project Execution 14 Planning-Preliminary Plat- Transformer 2018.tif Standard Product Valuation.pdf Ordinance 2014-060Authorizing Process Substation-Rev 2.pdf Project Execution Process DME_WorkflowlnterfacesDiscover ERM Procedure MR-06 the Energy Risk Management 02 Site&Route Selection-Project Substation-Rev 2.pdf y_vl.pdf Transaction Risk Limit.pdf Policy FINAL.pdf Execution Process-Rev 9.pdf 15 Planning-Minor Plat-Project EMO Procedure 01 Position ERM Procedure 5E-01 ERCOT Ordinance 2018-017.pdf 03 AIS-Site Selection-Project Execution Process Substation-Rev Balancing Methodology.pdf Settlement Process.pdf Pole Assembly Trans Inspections Execution Process Substation-Rev 3.pdf EMO Procedure 02 Load Forecast ERM Procedure 5E-02 Bilateral 4-26-12.xlsx 1.pdf 16 Planning-Final Plat-Project Methodology.pdf Settlement Process.pdf PSE Collateral Annex.pdf 04 Land Acquisition-Substation Execution Process Substation-Rev EMO Procedure 03 Estimate Executive Dashboard Packet 7-31- PSE Master Cover Sheet.pdf Project Execution Process-Rev 3.pdf Available Resources 18.pdf R2013-036Investment Policy.pdf 10.pdf 17 Planning-Conveyance Plat- Methodology.pdf FY2019 GS Manual.pdf RD Wells to Hickory.pdf 05 Land Acquisition-Transmission Project Execution Process EMO Procedure 04 Review MeterPingLogic.pdf RE Denton Municipal Electric- Line Project Execution Process Rev Substation-Rev 1.pdf Position and Perform Deals RPT.2018 ERCOT Black Start ACTION REQUIRED FOR 7.pdf 18 Design Electrical&Structural- Methodology.pdf Plan.pdf UNINTERRUPTED ACCESS TO IFUS 06 AIS-Land&Easement Substation Project Execution ERM Procedure CR-01 Master Santa Rita Operating (IFUS PA).msg Acquisition-Project Execution Process-Rev 2.pdf Agreement Negotiations.pdf Procedures.docx Risk Disclosure Statement.pdf Process-Rev 2.pdf 19 Design Relay-Substation ERM Procedure CR-02 Substation Loading at 2018 Sales and Use Tax Certificante.pdf Project ExecuticOOrocess-Rev Counterparty Evaluations.pdf Peak.tif STRATEGIESNEWGEN AND • • • Appendix B - Documents Reviewed (cont'd) Tailboard-Job Briefing Studies-DMU Management Citizen Connection NOV 2017.pdf Resident Update_Dec Jan FY17-18 WW Mini Budget Procedure.pdf Study.pdf Citizen Connection SEPT 2017.pdf 2018_Final.pdf Book.pdf Visio-Joint Use Process.pdf UMGHR final report-Aug 1 Citizen Connection SEPT 2018.pdf Resident Update-Feb March FY18-19 WW Mini Budget Book DME public communicaiton 2016.pdf DWW 2014 poster.pdf 2018_final.pdf 09-21-18.pdf paths.docx Denton_Plan_2030.pdf Dyno Decal.pdf Resident Update-June July Wastewater 5 Year Exp.Rev.xlsx DME Tree Trimming Program.pdf Purch Flowchart_Change Dyno Dirt brochure_Rev0118.pdf 18_final.pdf Wastewater 5 Year History CIP.xIs door hanger.bmp Orders.pdf Dyno Dirt_2018 Campaign.docx Resident Update-Oct Nov Wastewater 5 Year Rates.xlsx Electric Outage Communication Purch Flowchart-Greater Energy Conservation Tips Flier.pdf 2017_Final.pdf Wastewater 5 Year ROI and Plan jr.docx $50K_CoOp_Revised2.pdf FW_Management Study-Public Reverse Litter Banner 2x4.pdf Franchise Fees.xlsx GreenSense Energy Rebate Flier Purch Flowchart-Greater Relations.msg Water Conservation_handout.pdf Denton,city of_001 EPA 1017.pdf $50K_Revised2.pdf FW_Management Study-Public Auto and Property claims EK.xlsx permit.pdf Learn to Conserve Workshop Purch Flowchart-Greater Relations.pdf Copy of Utilities-Workers Comp Denton WWCS AMP Thermostat 0216.pdf $50K_SS_Revised2.pdf Grease Interceptor Maintenance claim summary 10-01-2014to 09- FY17_180205.pdf 2016 Innovation Plan.pdf Purch Flowchart_OR to Brochure.pdf 30-2015.xlsx Equipment Criticality List DME TS 5-Year Roadmap PO_Greater Than$50K.PDF Grit Traps Brochure.pdf Copy of Utilities-Workers' (final).xlsm v2018.6.docx Purch Flowchart-OR to PO-Under Grow Zone Sign_2018_print.pdf Compensation claim summary 10- Wastewater Collections 2018-125 CO Bond Sale and Rating $50K.PDF Learn To Conserve Multi Family 01-2015 to 09-30-2016.xlsx Performance Metrics.docx Reports.pdf 14 Public Relations.pdf Handout 0316.pdf Copy of Utilities Workers' WW Collections Risk Rating.pdf Appropriable Fund Balance used 2017 Citizen Update_Final2.pdf Learn To Conserve Multi Family Compensation Claims 10-1-16_9- WW Plant Critical Equipment.docx for the 2018 beginning budget 2017-18 Utility Rate Brochure.pdf Handout_Spanish.pdf 30-17.xlsx WW Plant Process and Equipment 6_12_17 TP 120517.pdf Annual Report 1617_final.pdf Learn to Conserve Workshop Copy of Denton requested Criticality List(final).xlsx Complete 2017-007 Informal Staff Citizen Connection APRIL 2017.pdf Sprinkler Use 0116 print.pdf Benchmark data.xlsx nv.xlsx MasterplanExisting.pdf Report on 2017 Utility System Citizen Connection APRIL 2018.pdf Learn to Conserve Workshop_DIY 16 FY17-18 Final Budget MasterplanLongTerm.pdf Revenue Bond Sale.pdf Citizen Connection AUG 2017.pdf Drip Irrigation_0416.pdf Binder.pdf MasterplanShortTerm.pdf 1997 Management Study- Citizen Connection AUG 2018.pdf Maintain Your Drain Can Lids.pdf B&A 2015 Denton Water Utilities Denton SCADA MP Scope of Governance.pdf Citizen Connection DEC 2017.pdf Maintain Your Drain-Truck Cost of Service&Rate Design Work_FINAL.docx 3 Turnover.pdf Citizen Connection FEB 2017.pdf Wrap.pdf Study Revised Report.pdf 2017 Award Notification Letter- City Charter and Ordinance Citizen Connection FEB 2018.pdf Maintain Your Draun-Web Banner Budget Process.xlsx Ronald B Sieger Biosolids Excerpts.docx Citizen Connection JAN 2017.pdf 160x600.pdf 01 FY17-18 Final Budget Management.pdf Copy of Terms 8.1.15 to 8.24.18- Citizen Connection JAN 2018.pdf Maintain Your Draun-Web Banner Binder.pdf Award Notification Letter-Sidney for Electric Water and WW.xlsx Citizen Connection JULY 2017.pdf 300x250.pdf Wastewater dashboard, Allison-PS Arora.pdf Navigant water cs report draft Citizen Connection JULY 2018.pdf Maintain Your Draun-Web Banner 020217.pdf Award Notification Letter-Munc 100308.ppt Citizen Connection JUNE 2017.pdf 728x90.pdf FY14-15 WW Mini Budget WWTP of the Year-Cat 3.pdf Navigant water cs report draft Citizen Connection JUNE 2018.pdf Resident Update_April May Book.pdf Award Notification Letter-Sidney 100308.pptx Citizen Connection MARCH 2018_final.pdf FY15-16 WW Mini Budget Allison-City of Denton Collection Navigant water cs report draft 2017.pdf Resident Update_Aug Sept Book.pdf System.pdf 1003081.pptx Citizen Connection MARCH 2018.pdf FY16-17 WW Mini Budget PSArora Papers Presented.docx 2018.pdf 267 Book.pdf STRATEGIESNEWGEN AND • • Appendix B — Documents Reviewed (cont'd) Texas WET Article Denton FY18-19 Water Mini Budget Book Q6 Denton SCADA Master Plan- 0.Denton LLWTP-Low Lift Pump 6 Spill and Emergency Response- AMP.pdf 09-21-18.pdf FINAL.PDF Station O&M_Final.pdf revised.doc Texas WET Article PCWRP.docx Internal Service Payments-Debt Tx Water Development Board- 0.Denton LLWTP-Raw Water By 7 Operator Education and Training Texas Wet Issue 1.2018 Service and Transfers.xlsx 2017 State Water Plan.pdf Pass EOM_Final.pdf -revised.doc Phosphorus Real Time Control.pdf Wastewater Org Charts.pdf Water GIS Assets List.xlsx 0.Denton LLWTP-Variable Speed 8 Records-revised.doc Wastewater Org Charts Water 5 Year Exp.Rev.xlsx Water System Map.pdf Flocculators EOM_Final.pdf FW_Question about major claims 20190312.pdf Water 5 Year History CIP.xIs WM SOP METERING.doc 0.Denton LLWTP-Ozone System involving utilities.pdf Infrastructure Leakage Index Water 5 Year Rates.xlsx 2017 Water Quality Report 0&M_Final.pdf FW_Question about major claims Comparison-Region C.PNG Water 5 Year ROI and Franchise Denton_final.pdf 0.Sodium Hypochlorite and LAS involving utilities2.pdf Non Revenue Water Comparison- Fees.xlsx 2017 Water Quality Report Feed and Storage Facilities FW_Retirement Info-Sensitive NTX.PNG Water Org Charts.pdf Denton_Spanish.pdf OM_Final.pdf Data.pdf 5 Year Exp.Rev.xlsx Water,Wastewater Accounts.xlsx 0.Denton LLWTP-Backup 1 Introduction-revised.doc LRRWTP SOP.doc FY14-15 Water Mini Budget Denton Water Utilities Cost of Disinfection Plan EOM_Final.pdf 2 Major Treatment Components OM TOC-revised.doc Book.pdf Service&Rate Design Study 0.Denton LLWTP-Biologically and Processes-Revised.doc Retirement Eligiblity 12-31-2017- FY15-16 Water Mini Budget Revised Report Active GAC Filters OM_Final.pdf 3 Chemical Feed Systems- for Utility study.xlsx Book.pdf 6_3_2015_FINAL.pdf 0.Denton LLWTP-Chemical revised.doc FY16-17 Water Mini Budget Water Org Charts 20190312.pdf Systems EOM_Final.pdf 4 Laboratory Equipment and Exit Interviews for 80 Individuals Book.pdf Water.WW.Drainage.Bonds.xlsx 0.Denton LLWTP-Filter Air Scour Procedures-revised.doc FY17-18 Water Mini Budget 5 Year Break History.xlsx and Backwash O&M_Final.pdf 5 Maintenance-revised.doc Book.pdf Water Loss Audit.xlsx 268 STRATEGIESNEWGEN AND • • �a s = o. Y... O 269 Scorecard Af COMMUNICATION FINANCE INFRA5TRUCTURE PEOPLE PROCE55 5TRATEGY Starting Scores 4.1 3.7 3.9 4.3 4.2 - 4.3 Survey Results Surveys of remaining original participants were conducted in October 2019 to assess how each area has changed. Each area was evaluated from 1-5 with 1 being Worse, 3 as No Change and 5 Better. Most scores were near 4 which ranked as Somewhat Better. The average relative change score for each is shown below the original study light indicator. • 270 WARNING ATTENTION GOOD STRATEGIESNEWGEN • • 260 Utilities Management Survey Electric ■Worse ■Somewhat Worse u Same ■Somewhat Better ■Better 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Communication Finance Infrastructure People Process Strategy Employee Morale Community Perception PUB Leadership City Council Leadership L Surveys of remaining original participants were conducted in October 2019 to assess how each area has changed. Each area was evaluated from 1-5 with 1 being Worse, 3 as No Change and 5 Better. Most scores were near 4 which ranked as Somewhat Better. 271 NEWGEN STRATEGIES AND SOLUTIONS, 261 Scorecard — Water & Wastewater with Updated Change Values OD COMMUNICATION FINANCE INFRASTRUCTURE PEOPLE PROCE55 STRATEGY Starting Scores 4.1 3.7 3.8 4.2 4.0 4.1 Survey • � • Results Surveys of remaining original participants were conducted in October 2019 to assess how each area has changed. Each area was evaluated from 1-5 with 1 being Worse, 3 as No Change and 5 Better. Most scores were near 4 which ranked as Somewhat Better. The average relative change score for each is shown below the original study light indicator. 272 WARNING ATTENTION GOOD NEWGEN STRATEGIES AND SOLUTIONS, 262 Utilities Management Survey Water Wastewater ■Worse o Somewhat Worse a Same ■Somewhat Better ■Better 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Communication Finance Infrastructure People Process Strategy Employee Morale J Community Perception PUB Leadership City Council Leadership ` IL Surveys of remaining original participants were conducted in October 2019 to assess how each area has changed. Each area was evaluated from 1-5 with 1 being Worse, 3 as No Change and 5 Better. Most scores were near 4 which ranked as Somewhat Better. 273 NEWGEN STRATEGIES AND • • Utilities Management Survey Shared Services ■Worse o Somewhat Worse u Same ■Somewhat Better ■Better 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Changes Communication -_ - Finance People - Process — — Strategy Employee Morale Procurement Process PUB Leadership City Council Leadership r - Surveys of remaining original participants were conducted in October 2019 to assess how each area has changed. Each area was evaluated from 1-5 with 1 being Worse, 3 as No Change and 5 Better. Most scores were near 4 which ranked as Somewhat Better. 274 NEWGEN STRATEGIES AND • • Date: June 5, 2020 Report No. 2020-055 INFORMAL STAFF REPORT TO MAYOR AND CITY COUNCIL SUBJECT: In late May, Council Member Briggs forwarded a request to city staff to host a community meeting for the Denton University Park HOA. A number of residents inquired as to the recent activities (flags, markings on the ground) around the vacant land next to the elevated storage tank between Santos Drive and Riney Road. DISCUSSION: The Water Utilities Department began the preliminary design and site layout phase of a Booster Pump Station project to be located on the southwest corner of the property. The flags and markings on the site are for the survey work that is required for the preliminary design phase. The tentative project schedule predicts construction to begin in September 2021, approximately 15 months from now. Detailed design of the architectural look of the building and required architectural security features (fencing/wall) have not begun. This facility is necessary to support the new Denton High School and development in the area by providing additional water supply to the elevated storage tank(water tower)at Loop 288 and IH35. This will improve the City's water delivery and quality in that portion of our service area. Site access will be from Riney Road, as it is currently. The only access to Santos Drive will be one driveway required for emergency vehicles. Staff is preparing a letter with additional information to be mailed to the HOA and residents in the vicinity next week. In the Spring of 2021, staff will schedule a community meeting to receive feedback and involve residents regarding input on the appearance of the facility during the detailed design phase. 275 Date: June 5, 2020 Report No. 2020-055 Figure 1 —Aerial Photograph AL - — ,ner.�� •un ��ry e � 276 Date: June 5, 2020 Report No. 2020-055 Figure 2—Preliminary Engineering Site Plan o NOJN84 NivW No�SSIWsNVal 1181HX3 1f10AVl c R S a3ivm isaMHiaoN 1 s 311S NOIlV1S dWfld uaoHK<i(a WE '. ''i NO1N34�O AlIO V I p � i �I x o I RW Ilk <. e. ' r —L 277 Date: June 5, 2020 Report No. 2020-055 STAFF CONTACT: Frank Pugsley Director of Water Utilities 940-349-8086 REOUESTOR: Council Member Briggs PARTICIPATING DEPARTMENTS: Water Utilities STAFF TIME TO COMPLETE: 2 man-hours 278 Date: June 5, 2020 Report No. INFORMAL STAFF REPORT TO MAYOR AND CITY COUNCIL SUBJECT: Provide a project status update regarding the Forestar/Rayzor and Drury Tract single-family residential developments located at the northwest corner of Roselawn Drive and Roselawn Drive. BACKGROUND: Forestar Group, Inc. is under contract to purchase approximately 236.8 acres of land located at the northwest corner of Roselawn Drive and Roselawn Drive for a proposed residential development consisting of 770 single-family detached lots, open space, amenity center, parkland, park trails, and connections to adjacent Borman Elementary and nearby Denia Park. In August 14, 2019 Development Services received a preliminary plat application (Project No. PP19-0019) from Forestar Group, Inc. for a 723-lot single-family subdivision. The preliminary plat was approved by the Planning & Zoning Commission (P&Z) February 5, 2020. Subsequent to this preliminary plat submittal, Forestar Group, Inc. conducted a pre-application meeting for an adjacent property to the west of Forestar/Rayzor known as the Drury Tract(outlined in pink in the Attachment) proposing an additional 64 single-family lots. An overall Traffic Impact Analysis (TIA) for both developments (Project No. TIA20-0001) was submitted March 31, 2020 and an Alternative Environmentally Sensitive Area (AESA) plan (Project No. AESA20-0003) are currently under review by staff. DISCUSSION: The subject property is zoned Residential 4 (R4)which permits the proposed use of single-family residential by right. The developer proposes 770 single-family detached lots,providing 70.4 acres of open space within common area lots and preserved Environmentally Sensitive Area (ESA) water-related habitat. An additional 15.1 acres of ESA designated upland habitat is proposed for preservation as well. No further applications have been received to-date although multiple meetings have been held between the development team and various city staff including: Planning, Engineering,Water and Wastewater Utilities,Parks,Water Administration/Watershed Protection,Traffic Engineering,and Capital Projects. The development will result in future roadway connections for Parvin Street and Highland Park Road, and the reconstruction (elevation) of Roselawn Drive. Some tree removal will be required for grading adjacent to but off-site from the Roselawn Elevated Water Storage Tank. All minimum tree preservation requirements will be met by the overall development and some minor encroachments into the designated ESA water-related habitats are anticipated for stormwater outfall locations. These encroachments will be addressed through the submitted and consideration by City Council of an AESA plan (Project No. AESA20-0003). Parks Department staff has 279 Date: June 5, 2020 Report No. discussed possible parkland dedication to the city and trail connectivity to Borman Elementary and ultimately nearby Denia Park. The development's next steps include preliminary plat approval for the Duruy Tract, and civil engineering plan(CEP) and final plat approval for each phase. It is staff s understanding that the Parvin Street connection and reconstruction of Roselawn Drive adjacent to the project's frontages will occur with the first phase of this overall development. CONCLUSION: This ISR has been provided for informational purposes. ATTACHMENTS: Forestar/Rayzor—Drury Tract Concept Plan STAFF CONTACT: Richard Cannon, AICP Director of Planning and Deputy Director of Development Services (940) 349—8507 Richard.Cannonegcityofdenton.com 280 v•`�. i 1^ t Vr a`• � is nk it, r �s fps mot i- r i.. fa.•tc�y>-� - L ir. Sol ry ++�'.. }. �.«•. r rat MA ' 'A Sol At �lll � r _ 1 rX pw d1111��1�16 �IIIIIIIIIIIi. # � � IICIIIZI � '� �,,�Iinnnlin� ,�, ,�o i i��•�rl' , Land Use Acreage Summary 01 L ✓ aD_ � _ r.- -� Open Space(Including ESAAreas) 70.4 - .•,� T - •a !' Y- Tree Preservation Area(ESA-Preserved Upland Habitat) 15.1 �Z a S r Rrsp �, 1 F U' (• z ` '• O Residential Lots/Residential Rights of Way 166.4 zz O Total 236.8 WILLOWWOOD STREET (Open Space Acreage Summary -1- -1�-._-; ,I - - �• - - - - - - - -- - - _ Open Space 70.4 Total Percent Open Space 129.7% _ ��...,._. Lot Type Summary ' �.• - - - \�- - •I - \ c. F 52'x 115'(Rayzor) 706 �kl ID_ WILLOWCREST LOOP J •III - - -• Q Y�� '—{I - 55'x 130'(Drury) 64 �I I of, I Total 770 d T > v" I k Density Summary(Units per Acre) QI _ of ✓ ---- I- I Gross(Rayzor) 3.3 I -J = I I - - i = � I a " Gross(Drury) 2,g - WILLOWCREST LOOP MARGARET A.YOUNG J _T_ — EXISTING r ROD. O.017-3428 ❑ VIRGILitN 9M Sr ! -AVLOR PAHK CHURCH HIGHLAND PARK 1 = -IL OWWO OWES OR.DCT. Z THE BRAOLEVFAMILVTRUST SHAIf. SMITH • OF THE NAZARENE RENAME TO ALLEY I AB B. G.13 W DOL.NO.1997-60fi33 III T p R p Do - Y O.R.D C T. DOC.NO.19955241 t DOC.NO.2005-35385 II k — �.,, R�-�.r-� o.R.D c.r. o.R.D.c.T II I I U - AURE�T. dI t °A6'A� DUDLEY ST. 10 1 1 1H a LU - #�lUo ?PHASE2A W :DE 1A [=]iPHAS HASE1B c uJA 3 - --- J-.c�.- r AS6 2As 2. .. Si OPEN L III— SPACE II q LORR PARK = IVI � • . s AMENITY _ � II oaLoc T. � - CENTER // 4 PR.D OT. ' ��k - - - PARVIN STREET -- 1 __ r JA I I / -_ _ _ _PARVIN ST. — — �— / .y EXTEND ROAD AS 24'SECTION PHASE 2B y„ } 100-YR FLOODPLAIN (STUDIED) DENTON INDERENDENT SCHOOL o1DISTRICT VOLV D.RD.C.T,� y r`- � // / EXISTING oST / ,/17 "V"INLET CITY OF DENTON VOLo514,PO.579 c.r. BALTAZAR MESTA I-D DOC.NO.20U-57002 = AR.D.C.T. PHASE 3A - OBSERVED r + I STREAM BUFFER I� / / sE 1 Iii j ROAD STUB-OUT / 1 WATER RELATED HABITAT I / O � / N, PHASE 4 _ OPEN I SPACE .,. ft-n - 1\\ UPLAND HABITAT - - es 111,N1,1000,8-,ICIl �j f ry I TREE PRESERVATION Z Ll AREA 0 I I �/ LOT 1.BLOCK A ` III o l ROSELAWN ELEVATED - I O PHASE 3B ' CO STORAGE TANK ADDITION 1 - cAB.Y.PG]]] PR.DC. T- � I ESA - - FLOOD PLAIN -- - - zl I I p m — Q / J_ ) 0.r THOMAS A.GARBACIK U AND MARY JOANN GARBACIK DN 994-1091 Y z O VOL..R.D PG.151 566, DO NO O.ROLC.T. 'S DR.D.GT. /� / • A -- AWN DRIVE _ 5 TRACT iI - I( LOT 3, LOT 1 ROSELA NACRES LOT 2 TED C.MEADOR MARC S. LOT 2, LOT 1, PART OF PITNER FAMILY LIMITED =__ - SORREL SECTION 11.TRACT ONE \ PARTNERSHIP MCBRIDE ACRES ADD ION DOC.NO. CULP SORRELLS- SORRELLS- DOC.NO.2013-]0]62 CAB.U,PG.1 6,P.R.D.C.T. 2001_5374 DOC.NO. MCBRIDE MCBRIDE ACRES RAYZOR INVESTMENTS,LTD. O.R.D.0 T. 2001-3928 ACRES CAB.x,PG.749 VOL.1]96,PG,601 ) �' `• ,^.R.D.0 T. O.R.D.0 T. P.RZ,C.T. D.R.D.C.T. / y 1 GRAPHIC SCALE IN FEET 1=200 @ 2436 CONCEPT PLAN Forestar Kimley )) 4rn Denton, Texas 13455 Noel Rd.,Two Galleria Office Tower Suite 700 June 2020 Dallas,Texas 75240 972-770-1300 State of Texas Registration No.F-928 �ASTSAEo ­746- R.�o 6ENEHTOFASN 282 KooMADTA�TNTH Date: June 5, 2020 Report No. 2020-057 INFORMAL STAFF REPORT TO MAYOR AND CITY COUNCIL SUBJECT: 2019 Water Loss Audit EXECUTIVE SUMMARY: Water Utilities staff completes a water loss audit annually in accordance with Texas Water Development Board(TWDB)regulations and industry best practices. This year's audit identified water losses similar to recent years and identified opportunities to improve these metrics in the future. BACKGROUND: TWDB requires the completion of water loss audits annually by all water utilities serving more than 3,300 customers. Beyond State requirements, a water loss audit program presents opportunities for better resource conservation and improved fiscal responsibility. For many years, staff has executed water loss audits to standards over and above TWDB minimum requirements in pursuit of a healthier water utility. Water loss audit standards within the industry have continued to evolve, which provides ongoing opportunities for the improvement of individual audits and has led TWDB to refine their water loss audit framework. DISCUSSION: As a primary function, Denton's water loss audit separates water use into three categories: (1) authorized consumption, (2) apparent loss, and(3) real loss. (1) Authorized consumption consists of all water that has been authorized for use by the utility and its customers. Authorized consumption includes, but is not limited to, water used for residential and commercial uses, firefighting, municipal landscape watering,pipe flushing, city offices, and water treatment facility use. Authorized consumption is all the water the utility gave permission to a business, individual, or itself to use. Staff previously identified an opportunity to improve water volume estimations for new pipe flushing and is implementing new methods accordingly. (2)Apparent loss represents water that was not accurately measured and/or not recorded at a customer meter and therefore not billed due to meter inaccuracy, theft, and billing waivers. This category represents a loss in revenue, and since customer meters hold customers accountable for their water use, it also represents a detriment to water conservation efforts. The water meter maintenance and replacement program works to offset this loss and maintain reasonable accuracy in customer meters. 283 Date: June 5, 2020 Report No. 2020-057 (3) Real loss represents water that left the water distribution system without serving a purpose. This is largely a result of leakage. Staff estimates water lost through known main breaks and leaks, and the remaining unaccounted-for volume is assumed to be undiscovered leakage. The city implemented programs to repair known leaks and search for undiscovered leaks. To the extent that this program is financially offset by the value of water saved, staff can continue to reduce real loss through leak detection and repair. The waterline replacement program in Water Distribution also plays a large part in this figure, as they aim to replace the pipes which are most likely to break. Staff identified an opportunity to improve water volume estimations on known water main leaks and breaks and is implementing new steps accordingly. In a benchmarking study of real and apparent loss, Denton sits near the middle of Region C utilities in both per connection and per capita measurements as shown below. Real and Apparent Loss per Connection Across Region C ■Real loss Apparent loss 140 120 100 — G d a `0 80 G c 0 v `w 60 n c 0 t7 40 20 pF � O c le �o q4 a a 4oc �c 284 Date: June 5, 2020 Report No. 2020-057 Total Loss per Capita Across Region C 45 40 35 G V 30 G a 25 0 1; c 0 20 V v a 0 15 10 5 0 s4"A, "'0 Pe Pl � `1 ' t .�clnc�r g 'PJO 0 "'P 6 a aor ae1P0 4a F a ciL�s� O � �c The water loss audit framework also includes calculation of the Infrastructure Leakage Index (ILI), which is a measure of real loss adjusted for the size of each utility. This metric is useful for benchmarking due to its size considerations. ILI compares real loss to a theoretical unavoidable leakage unique to each utility based on their size. A value of 1 would suggest a utility has avoided all possible leakage. There is no upper limit to this metric. Denton's ILI in 2019 was 2.13, which places us in the top 40% of Region C utilities as shown below. 285 Date: June 5, 2020 Report No. 2020-057 Infrastructure Leakage Index (ILI) Across Region C 10.00 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 I I boa S°o y¢ � �.r c� ti` moo jai �6 p¢ ¢A Q do �r � �P2S P G°c �50 0' p� �0 g� s� Qo�o a��a �� P�¢aa��O�j°0�ac °ra c� a`'�g s`° t yJ ,Fcc¢ ��aS Qua Ja'A'`�`a p9 O \. 0 Cg �a QP oa 4 or a o 5'c¢Qe 6� o`ac yea P �c In the 2019 Water Loss Audit, staff verified existing concerns with the accuracy of large water meters at Denton's water production plants. Such accuracy errors have inflated the total amount of water produced, causing losses to appear to rise over time. Out of the four affected meters, two have been replaced, and one of the remaining two will be replaced in 2020. Staff is implementing steps to validate the accuracy of these meters and improve water accounting within the water production plants. Improved accuracy of these meters will likely result in reduced estimations of water loss in future audits. CONCLUSION: Denton has continued to maintain a competitive water loss management program and has implemented new steps to continue to improve the program. ATTACHMENT(S): Water Audit Presentation 2019.pdf(pptx as pdf) STAFF CONTACT: Tyler Dawson, Manager of Asset Management 940-349-8944 Tyler.Dawson(cr�,CityofDenton.com 286 1 Wate oss Au d it a 47, J U N E 81 2020 PUB20-103 1 Water Loss Audit Authorized Consumption + Apparent Loss + Real Lose Total Water Supplied Residential Billed Authorized Water Consumption commercial Produced Water Supplied Fire Protection Unbilled System Operations Meter Inaccuracy Apparent Loss Unauthorized Consumption Water Loss L Systematic Data Error Main Breaks Real Loss PUB20-103 MA?- Unaccounted Rea I Loss Real loss is water lost through distribution system leakage and excessive pressure Main breaks and leaks Undiscovered leakage Background leakage Other unidentified losses Effects of Rea I doss Real losses are indicators of system health These losses should be minimized within economic reason Real losses are priced at the marginal cost of water acquisition and treatment Denton FY 2019: 607.20 MG/ 9.40% Apparent Loss Apparent loss is water that was not read accurately by a meter Water meter inaccuracy Unauthorized consumption Systematic data errors Effects of Apparent Loss Apparent losses are indicators of fiscal health Inaccurate meters and theft reduce revenue Apparent losses are priced at the retail volume cost of water Denton FY 2019: 197.42 MG/ 3 .09% Unbilled Authorized Fire Protection is provided as an unbilled service Fire sprinkler systems Fire engine use System operation often requires flushing water mains Cleaning new pipes after installation • Removing old water from low flow pipes • Flow rate testing and water quality sampling Residential 2,628 Billed LM Authorized 5,515 FV Water Consumption Commercial Produced Water 5,593 2,887 6,476 Supplie hL 6,398 Unbilled Fire Protection 1 78 System Operations 77 Meter Inaccuracy 176 Water Loss Apparent Loss 19 Unauthorized Consumption 16 Systematic Data Error 5 805 Main Breaks 40 Real Loss 607 PUB20-103 Unaccounted 567 Cost of Water Loss Real Loss - $209,487 / 607.20 MG Real loss is priced at the variable cost of treating 1,000 gallons of water: $0.35 Cost of real loss will increase in the future when Denton acquires additions to the water supply Apparent loss - $947,621 / 197.42 MG Apparent loss is priced at the average retail cost of 1,000 gallons of water: $4.80 This amount is offset by our proactive meter replacement and calibration program Benchmarking Data Points Real Loss System Health Apparent Loss Fiscal health Infrastructure Leakage Index ( ILI ) Comparison to theoretical minimum leakage Benchmarl< ing Considerations System Size • Growth • Water Quality / topology Infrastructure Age Audit Validation Real and Apparent Loss per Connection Across Region C ■Real Loss ■Apparent Loss 140 120 100 a 0 v a 0 80 v 0 U a 60 H _ O a c� 40 20 0 • , e\`oa Otto e\�et tteO \\� \e`` J`o�O \o�J °c J t�eA reo5 ��r zA `y°o ��°o Gaon \aoa yo�o a\t�e rah` air t��� `y°o .e� oar �eJ Sao ay°o \ago ��,A °oe eat c `��e �e tto Qo� �t Lo ��0 P Jr Qo Q� Lo Ito Paa Oe °ty fat Oe aQt Ooo yQ,t eaa OP o \�� Q 0 tP 5ata ��a� mate �t Fates a� �- 0o O ,ot 0 1 1 Total Loss per Capita Across Region C 45 40 35 0 a 30 a 25 a a 20 a a 15 10 - 5 0 �\\et �\a�w \\�o� ate\\ \o�J \\ems S�eJ ;\\e moo �r ewe -`�J °�o a� \eJ a� a�a \i`e a�a �\\ ter \\�a a°o y°o \\J �eJ �` y°� �e �o Matto �e r Lo P Qo �e��5 �e� Lot Qwr r° oeh �o�r �to� 5rettc Oat\ �aQty`� �eaat o J�° C.� Q� `rota � t rtoo�a Qa\\ae haa`y� Qa t e� 0 1 1 Infrastructure Leakage Index ( ILI ) Calculated as total real losses over theoretical minimum leakage An indicator of a utility's effectiveness in managing leaks Theoretical minimum of 1 Denton FY 2019: = 2. 13 AWWA Infrastructure Leakage Index (ILI) Across Region C 10.00 9.00 8.00 7.00 6.00 5.00 4.00 — 3.00 - 2.00 - 1.00 0.00 NO e o -A Paa`yo� �arye P�e� �r o�5`oa�a �o�\e�� ol- Jar°i A J \e Fot�eAeJ ret�a� ea�C5 Q\a�o tJ`\`�� ata�o� 0 011 e� 0 Infrastructure Leakage Index - Technical Performance Indicator 1.0— 3.0 3.0—5.0 5.0—8.0 > 8 302 ' 1 1 Water Leak Data Capture Length of Break 4)4 �. av Break - F--1 Gallons Lost t . 0 rDiameter _ i Lea Time Implementation Steps ✓Continue meter replacement program Continue leak detection program with improved technology Continue use of improved main break water loss estimates o Improve volume estimates for new line flushing o Create and implement Mass Balance Worksheet for plants DENTON� Water Utilities Questions Comments Council Requests for Information Council Member Requestor Date Summary of Request Staff Assigned Department Comments Council Member Briggs 02/03/20 Would like to request council discuss a citywide public health study. Balthrop Mendoza City Manager's Office Request will be presented during a future Pending http://www.austintexas.gov/sites/defaulVfiles/files/Health/Info_to_Post/He Request work session a epo -in a .p Like this 2 Council Member Briggs 05/17/20 Can staff look at a light to brighten the traffic circle on Hinkle Estes Capital Projects Information will be provided in June 5 Friday Report Council Member Davis 05/19/20 Disconnected fragments of streets that share the same name(i.e. Estes/McDonald Capital Projects/Development Information will be provided in a future Friday Report Westgate,Riney,etc.)cause considerable confusion. I'd like to make a Services 3 very surface level catalog of these streets and see if there aren't some easy fixes we could make.For example,the East-West part of Westgate is an easy switch,while East Oak is not. Council Member Briggs 05/24/20 Request for speed study,permanent reducing speed ideas on Hercules. Jahn Capital Projects Information will be provided in a future Friday Report 4 Maybe a flashing digital sign to show speed?Is there a way we could put this on PD enforcement list rotation for awhile? Council Member Briggs 05/26/20 1 would like to set up a staff meeting with the University Park Cox Public Works Information will be provided in the June 5 Friday Report 5 neighborhood.They are curious about what we are doing and have some suggestions, comments. 6 Council Member Briggs 05/26/20 Can staff check on the asphalt/road at Orr St.and North Locust? Estes Capital Projects Information will be provided in the June 5 Friday Report Constituent says it has sunk. Council Member Briggs 05/27/20 Can staff assess Atlas Dr.and update on any construction efforts? Estes Capital Projects Information will be provided in the June 5 Friday Report 7 Resident says that construction began 2 years ago by utilities,and now road is in bad shape 8 Council Member Briggs 05/29/20 Would Solid Waste be able to upcycle five gallon buckets? Boerner Solid Waste and Recycling Information will be provided in the June 5 Friday Report 9 Council Member Briggs 06/01/20 Can someone check on who mowed the wildflower patch on private Packan Parks and Recreation Information will be provided in the June 5 Friday Report property at 915 E Sherman Dr.? 10 Mayor Pro Tern Hudspeth 06/02/20 Can staff check on the signal timing at the corner of US77 and Locust Jahn Capital Projects Information will be provided in the June 5 Friday Report 11 Mayor Pro Tern Hudspeth 06/02/20 Have we contacted the property owner to address the fence downtown? McDonald Development Services Information will be provided in the June 5 Friday Report Please let me know the plan. 12 Council Member Briggs 06/03/20 In the light of recent events and calls from the community, I would like Dixon Police Request will be presented during a future Pending ask for a Work session on police review/oversight board Request work session Council Member Davis 06/03/20 1 would like to see a summary of the improvements Chief Dixon(and Dixon Police Information will be provided in a future Friday Report Chief Howell before him)have made in community relations and officer training that are helping prevent police violence in Denton.This could be an ISR.But I would also like to see a work session where the Chief could 13 respond to some of the things BLM and the protesters are asking for.For example,a police oversight board,a more granulated use of force continuum,disallowing certain types of holds,etc.The average citizen doesn't know a lot about these kinds of things,and hearing the Chief's perspective could be very helpful. Council Member Meltzer 06/03/20 When the smoke clears,I would like to see an informal staff report on the Dixon Police Information will be provided in a future Friday Report 14 viability and desirability of the items in the attached agenda from the NAACP,excluding the item requiring State action,although an opinion on that would be welcome as well. 15 Council Member Meltzer 06/04/20 Can staff provide an evaluation of feasibility and desirability of the 10 Dixon Police Information will be provided in a future Friday Report recommendations provided? Council Member Briggs 06/05/20 There have been many task forces and groups convened by city over the Information will be provided in a future Friday Report 16 years where poc were asked to serve to address race and racial injustice (Ex. Diversifying the fire dept)can city research and create list of these groups and identify reports/recommendations? 306 June 2020 Sunday Monday Tuesday Wednesday Thursday Friday Saturday 1 2 3 4 5 6 Cancelled - 11:30 am 1:00 pm CC Work Cancelled - 2:30pm Cancelled-8:30DEDC Councilluncheon Session Agenda Committee Cancelled-COE 1:30 6:30 pm CC Re gula r 1:00 Public Art Committee Cancelled-Traffic Session Safety Commission i 5:00pmP&ZWorkSession 5:30 pm 6:30pmP&ZRegularSession 7 8 9 10 11 12 13 PUB 9am 1:00 pm 2nd Tuesday Cancelled - 2:30pm HOT&S Committee Session Agenda Committee 10am HLC 3:00pm Cancelled-Mobility Committee Meeting 9:00 am 14 15 16 ' 17 18 19 20 2:00 pm CC Work 5:00pmP8zZWorkSession HOT&S 9:00 TBD Session 6:30pm P&Z Regular Session 6:00pmCotru itteeon 6:30 pm CC Regular Persons with Dis abilities Session HABSCO 4pm 21 22 23 24 I25 26 27 PUB 9am loam Council Airport HOT&S 9:00 TBD Committee 5:30PM Board of 2:00 pm 4th Tuesday Ethics Session 28 29 30 ZBA 5:30pm No Council Meeting 307 July 2020 Sunday Monday Tuesday Wednesday Thursday Friday Saturday 1 2 3 4 8:30DEDC 411 of July 4:00 Public Art Committee Holiday 5 6 7 8 9 10 11 I No Luncheon Meeting No Council Meeting 11:00EDPB COE 1:30 2:30pm Agenda Committee Traffic Safety 5:00pm P&Z Work Session Commission 5:30 pm 5:30 Airport Advisory Board 6:30pm P&Z Regular Session 12 13 14 15 16 117 18 PUB 9am No CouncilMeeting 2:30pm Agenda HOT & S 9-11 Mobility Committee Committee 6:00pm Committee on Meeting 9:00 am Persons With Disabilities HABSCO 4pm 19 20 I21 22 23 24 25 2:00pm CC Work 12:00 TIF Board(TIRZ) Session 2:30pm Agenda 6:30 pm CC Regular Committee Se ssio n 5:00pm P&Z Work Session 6:30pm P&Z Regular Ses s ion 26 27 28 29 30 31 PUB 9am loam CouncilAirpon 2:30pm Agenda 5:30PM Board of ZBA 5:30pm Committee Committee Ethics 2:00 pm 4th Tuesday Session 308 August 2020 Sunday Monday Tuesday Wednesday Thursday Friday Saturday 1 2 3 4 5 6 7 8 11:30 am Council 2:00 pm CC Work 2:30pm Agenda 8:30 am Council Budget Luncheon Session Committee Workshop 6:30 pm CC Regular 5:00pmP&ZWorkSession 8:30DEDC COE 1:30 Session 6:30pmP&ZRegularSession 4:00 Public Art Committee Traffic Safety Commission 5:30 pm 9 10 11 12 113 14 15 PUB 9am 2:00 pm 2nd Tuesday 11:00EDPB Session 2:30pm Agenda Mobility Committee Committee Meeting 9:00 am 5:30 Airport Advisory Board 16 17 18 19 20 21 22 2:00 pm CC Work 2:30pm Agenda 6:00pmCommittee on Se ssion Committee Persons With Disabilities 6:30 pm CC Regular 5:00pmP&ZWorkSession HABSCO 4pm Se ss io n 6:30pm P&Z Regular Session 23 24 25 26 27 28 29 PUB 9am 10am CouncilAnport 5:30PM Board of Committee Ethics 2:00 pm 4th Tuesday Session 30 31 ZBA 5:30pm 309 Cityof Denton City Hall 215 E. McKinney St. Denton,Texas 76201 www.cityofdenton.com DENTON Meeting Agenda City Council Tuesday,June 16,2020 2:00 PM Council Work Session Room WORK SESSION BEGINS AT 2:00 P.M.IN THE WORK SESSION ROOM REGULAR MEETING BEGINS AT 6:30 P.M.IN THE COUNCIL WORK SESSION ROOM Note: Mayor Chris Watts, Mayor Pro Tem Gerard Hudspeth, and Council Members Keely Briggs, Jesse Davis, John Ryan, Deb Armintor and Paul Meltzer will be participating in the work session, closed meeting, and regular meeting via video/teleconference. REGISTRATION GUIDELINES FOR ADDRESSING THE CITY COUNCIL Due to COVID-19 precautions, members of the public will not be able to attend the June 16, 2020 City Council meeting in-person. To accommodate and receive input on agenda items, citizens will be able to participate in one of the following ways (NOTE: Other than public hearings, citizens are only able to comment one time per agenda item; citizens cannot use both methods to comment on a single agenda item. Public comments are not held for work session reports.): • Virtual White Card — On June 12, the agenda was posted online at www.cityofdenton.com/publicmeetings. Once the agenda is posted, a link to the Virtual White Card, an online form, will be made available under the main heading on the webpage. Within this form, citizens may indicate support or opposition and submit a brief comment about a specific agenda item. Comments may be submitted up until the start of the meeting, at which time, the Virtual White Card form will be closed. Similar to when a citizen submits a white card to indicate their position on the item, these comment forms will be sent directly to City Council members and recorded by the City Secretary. City Council Members review comments received in advance of the meeting and take that public input into consideration prior to voting on an agenda item. The Mayor will announce the number of Comment Cards submitted in support or opposition to an item during the public comment period. Comments will not be read during the meeting. The City Secretary will reflect the number of comments submitted in favor/opposition to an item, the registrant's name, address, and (summary of) comments within the Minutes of the Meeting, as applicable. OR • By phone — Citizens wishing to speak over the phone during this Council meeting, may call (940) 349-7800 beginning 30 minutes prior to the meeting start time. Comments by phone will be accepted until the item is opened for discussion by the Council. When the call is initially received, a staff member will receive the caller's information and either: 1) offer to call the citizen back when it is time for them to speak, or 2) record the caller's information, support or opposition, and comment. If the caller chooses to record their support or opposition, rather than speaking during the meeting, the Mayor will announce the number of comments submitted in support or opposition to the item. If the caller wishes to receive a call back, the voice of each caller will be broadcast into the meeting during the public commenting time of their desired agenda item. Individuals will be able to comment once per agenda item,no matter the method. Page 1 Printed on 61512020 310 City Council Meeting Agenda June 16,2020 • At regular meetings only, citizens can speak on any topic that is not on the agenda (Open Microphone). Alert the call taker if you wish to speak under the Open Microphone category. If you would like to give a public report, see the information below. After determining that a quorum is present, the City Council of the City of Denton, Texas will convene in a Work Session on Tuesday, June 16, 2020, at 2:00 p.m. in the Council Work Session Room at City Hall, 215 E. McKinney Street,Denton, Texas at which the following items will be considered: WORK SESSION 1. Citizen Comments on Consent Agenda Items This section of the agenda allows citizens to speak on any item listed on the Consent Agenda prior to its consideration. Each speaker will be given a total of three (3) minutes to address any item(s). Any person who wishes to address the City Council regarding these items may do so by utilizing the "By Phone" registration process as referenced under the REGISTRATION GUIDELINES FOR ADDRESSING THE CITY COUNCIL detailed at the beginning of this agenda. Registration is required prior to the time the City Council considers this item. Registrants may call in and remain on hold or receive a call back at the time the Work Session is called to Order and are encouraged to ensure they remain accessible to accept the call. 2. Requests for clarification of agenda items listed on this agenda. 3. Work Session Reports A. ID 20-965 Receive a report,hold a discussion,and give staff direction on the Green Tree Estates. B. ID 20-945 Receive a report, hold a discussion, and give staff direction regarding an update to the City of Denton's COVID-19 response. C. ID 20-888 Receive a report, hold a discussion, and give staff direction regarding the proposed prioritization and implementation of the City's Capital Improvement Projects. D. ID 20-1067 Receive a report and hold a discussion regarding plugged gas well issues, including risks and public protections from plugged wells, current inspection practices, setback distances in Denton and other area cities, and zoning incentives such as density bonuses that could encourage plugging wells in areas of new development. E. ID 20-673 Receive a report, hold a discussion, and give staff direction on pending City Council requests for information. Following the completion of the Work Session, the City Council will convene in a Closed Meeting to consider specific items when these items are listed below under the Closed Meeting section of this agenda. The City Council reserves the right to adjourn into a Closed Meeting on any item on its Open Meeting agenda consistent with Chapter 551 of the Texas Government Code,as amended,or as otherwise allowed by law. 1. Closed Meeting: -- PLACEHOLDER IN THE EVENT A CLOSED MEETING IS NEEDED; OTHERWISE, WILL BE DELETED. — Page 2 Printed on 61512020 311 City Council Meeting Agenda June 16,2020 Any final action, decision, or vote on a matter deliberated in a Closed Meeting will only be taken in an Open Meeting that is held in compliance with Texas Government Code, Chapter 551, except to the extent such final decision, or vote is taken in the Closed Meeting in accordance with the provisions of Section 551.086 of the Texas Government Code (the `Public Power Exception'). The City Council reserves the right to adjourn into a Closed Meeting or Executive Session as authorized by Texas Government Code, Section 551.001, et seq. (The Texas Open Meetings Act) on any item on its open meeting agenda or to reconvene in a continuation of the Closed Meeting on the Closed Meeting items noted above, in accordance with the Texas Open Meetings Act,including,without limitation Sections 551.071-551.086 of the Texas Open Meetings Act. NOTE: Any item for which a formal action at the Regular Meeting has been taken by Council may be subject to a request for a motion for reconsideration at any time during the meeting, at the Concluding Items Section, or after the meeting. In order to comply with the Texas Open Meetings Act, a request for a motion for reconsideration made during, at the end of, or after a Council meeting will be placed on the agenda and considered at the next official meeting of the City Council. REGULAR MEETING OF THE CITY OF DENTON CITY COUNCIL AT 6:30 P.M. IN THE COUNCIL WORK SESSION ROOM AT CITY HALL, 215 E. MCKINNEY STREET, DENTON, TEXAS AT WHICH THE FOLLOWING ITEMS WILL BE CONSIDERED: 1. PLEDGE OF ALLEGIANCE A. U.S.Flag B. Texas Flag "Honor the Texas Flag—I pledge allegiance to thee,Texas,one state under God,one and indivisible." 2. PROCLAMATIONS/PRESENTATIONS 3. PRESENTATION FROM MEMBERS OF THE PUBLIC A. Review of procedures for addressing the City Council. B. Reports from members of the public shall be received through the following two (2) methods. A total of up to seven (7) speakers are permitted to provide public comment and may include any combination of prior registration and open microphone speakers. 1) Pre-registration. This section of the agenda permits any person who has registered in advance to make a citizen report regarding a public business item he or she wishes to be considered by the City Council. Each speaker is allowed a maximum of four (4) minutes to present their report. At the conclusion of each report, the City Council may pose questions to the speaker or may engage in discussion. If the City Council believes that a speaker's report requires a more detailed review, the City Council will give the City Manager or City Staff direction to place the item on a future work session or regular meeting agenda and advise staff as to the background materials to be desired at such meeting. 2) Open Microphone. This section of the agenda permits any person who has not registered in advance for a citizen report to make comments about public business items not listed on the agenda. Such person(s) shall have registered using the "Virtual White Card" or `By Phone" process outlined by the City on its website or meeting notice. Page 3 Printed on 61512020 312 City Council Meeting Agenda June 16,2020 During open microphone reports under this section of the agenda, the Council may listen to citizens speak. However, because notice of the subject of the open microphone report has not been provided to the public in advance, the Texas Open Meetings Act limits any deliberation or decision by the Council to: a proposal to place the item on a future agenda; a statement of factual information; or a recitation of existing policy. Council Members may not ask the open microphone speakers questions or discuss the items presented during open microphone reports. NOTE: If audio/visual aids during presentations to Council are needed, they must be submitted to the City Secretary 24 hours prior to the meeting. 4. CONSENT AGENDA Each of these items is recommended by Staff and approval thereof will be strictly on the basis of the Staff recommendations. Approval of the Consent Agenda authorizes the City Manager or his designee to implement each item in accordance with the Staff recommendations. The City Council has received background information and has had an opportunity to raise questions regarding these items prior to consideration. Listed below are bids, purchase orders, contracts, and other items to be approved under the Consent Agenda (Agenda Items A — N). This listing is provided on the Consent Agenda to allow Council Members to discuss or withdraw an item prior to approval of the Consent Agenda. If no items are pulled, the Consent Agenda Items will be approved with one motion. If items are pulled for separate discussion, they may be considered as the first items following approval of the Consent Agenda. A. ID 20-866 Consider approval of a resolution of the City of Denton supporting the Michaels Development Company I, LP's 4% housing tax credit application to the Texas Department of Housing and Community Affairs for proposed new construction of Mayhill Road Apartments in Denton to provide affordable rental housing; and providing an effective date. B. ID 20-974 Consider adoption of an ordinance of the City of Denton authorizing a memorandum of understanding between the City of Denton, Texas, the Emily Fowler Library Foundation, and the Rotary Club of Denton, Texas #1779, for improvements to Quakertown Park; accepting donations of $40,000 from the Rotary Club of Denton and its members via the Emily Fowler Library Foundation and $15,000 from the Emily Fowler Library Foundation for improvements to the Quakertown Park; approving a plan for improvement of Quakertown Park and authorizing expenditures in furtherance of the plan; providing for an effective date. C. ID 20-1037 Consider approval of the minutes of June 2,2020(Regular and Emergency). D. ID 20-1058 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the City Manager to execute a contract with FCx Performance Inc. dba Instrumentation Services, for predictive maintenance testing services for the Water Reclamation Department's treatment plant and lift stations; providing for the expenditure of funds therefor; and providing an effective date (RFP 7300- awarded to FCx Performance Inc. dba Instrumentation Services, for three (3) years, with the option for two (2) additional one (1) year extensions, in the total five (5) year not-to-exceed amount of$118,200). The Public Utilities Board recommends approval Page 4 Printed on 61512020 313 City Council Meeting Agenda June 16,2020 E. ID 20-1059 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the City Manager, or his designee, to execute a contract with Holt Caterpillar Inc. through the Sourcewell Cooperative Purchasing Contract Number 032119, for the acquisition of one (1) New Caterpillar model D6XE Track Type Dozer for the Solid Waste/Landfill Department; authorizing the expenditure of funds therefor; and declaring an effective date (File 7376- awarded to Holt Caterpillar Inc., in the not-to-exceed amount of $469,401.38). The Public Utilities Board recommends approval F. ID 20-1061 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the City Manager to execute a contract with JDK Associates, Inc., for the installation of a gravity retaining wall in the Brinker Substation; providing for the expenditure of funds therefor; and providing an effective date (RFP 7316- awarded to JDK Associates, Inc., in the not-to-exceed amount of $755,296.68). The Public Utilities Board recommends approval(-). G. ID 20-1062 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the City Manager, or his designee, to execute a contract with Tymco Inc., through the Houston-Galveston Area Council of Governments (H-GAC) Cooperative Purchasing Program Contract Number SW04-20, for the acquisition of one (1) Tymco model 600 Regenerative Air Sweeper for the Drainage Department; authorizing the expenditure of funds therefor; and declaring an effective date (File 7294- awarded to Tymco Inc. in the not-to-exceed amount of $239,185). The Public Utilities Board recommends approval(-). H. ID 20-1063 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the City Manager, or his designee, to execute a contract with Rush Truck Centers of Texas LP through the BuyBoard Cooperative Purchasing Network Contract number 601-19, for the acquisition of one (1) 2020 Peterbilt model 348 truck chassis with hoist and two (2) emergency generators for the Water Reclamation Department; authorizing the expenditure of funds therefor; and declaring an effective date (File 7367 - awarded to Rush Truck Centers of Texas LP, in the not to exceed amount of $634,703.94). The Public Utilities Board recommends approval(-). 1. ID 20-1064 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the City Manager to execute a contract with Centricity GIS, for the continuation of the services for utility line locates for the Water Distribution Department, Wastewater Collections, Water Metering, and Denton Municipal Electric Department provided by Texas 811, which is the sole provider of these commodities and services, in accordance with Texas Local Government Code 252.022, which provides that procurement of commodities and services that are available from one source are exempt from competitive bidding, and if over $50,000 shall be awarded by the governing body; and providing an effective date (File 7336 - awarded to Centricity GIS, in the five (5) year not-to-exceed amount of $300,000). The Public Utilities Board recommends approval(-). J. ID 20-1065 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal Page 5 Printed on 61512020 314 City Council Meeting Agenda June 16, 2020 corporation, authorizing the City Manager to execute a Professional Services Agreement with Teague Nall and Perkins, Inc., for consulting services and to develop a master plan for Southwest Park for City of Denton as set forth in the contract; providing for the expenditure of funds therefor; and providing an effective date (RFQ 7170 - Professional Services Agreement for consulting services awarded to Teague Nall and Perkins, Inc., in the not-to-exceed amount of$198,800). K. ID 20-1066 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the City Manager to execute a contract with DFW Printing Services, LLC, for printing services for resident updates and construction guide printing and mailing for the City of Denton; providing for the expenditure of funds therefor; and providing an effective date (RFP 7317- awarded to DFW Printing Services, LLC, for three (3) years, with the option for two (2) additional one (1) year extensions, in the total five(5)year not-to-exceed amount of$325,000). L. ID 20-1068 Consider adoption of an ordinance of the City of Denton, approving an agreement with the Denton Independent School District and the City of Denton, Texas to work collaboratively to enable students in DISD to have greater access to Denton Public Library resources through a DISD Student Account at the Denton Public Library; authorizing the City Manager or his designee to execute the Agreement; and providing an effective date. M. ID 20-1105 Consider approval of a resolution of the City of Denton adopting an integrated pest management plan as policy for City-owned property; and declaring an effective date. 5. ITEMS FOR INDIVIDUAL CONSIDERATION A. ID 20-916 Consider adoption of an ordinance directing the publication of Notice of Intention to issue $27,250,000 in principal amount of Certificates of Obligation of the City of Denton for General Government projects; and providing for an effective date. B. ID 20-917 Consider adoption of an ordinance directing the publication of Notice of Intention to issue $37,120,000 in principal amount of Certificates of Obligation of the City of Denton for Electric, and Wastewater System projects; and providing for an effective date. 6. PUBLIC HEARINGS A. ID 20-994 Hold a public hearing inviting citizens to comment on the 2020-2022 Consolidate Plan for Housing and Community Development and 2020 Action Plan. B. PD20-0001 c Hold a public hearing and consider adoption of an ordinance of the City of Denton, Texas, regarding an initial zoning of Planned Development (PD) District on approximately 131.94 acres and for a change from Residential 6(R-6) to a PD District on approximately 14.19 acres, for a total of approximately 146.14 acres of land generally located south of Allred Road and west of South Bonnie Brae Street and Fort Worth Drive in the City of Denton, Denton County, Texas; adopting an amendment to the City's official zoning map; providing for a penalty in the maximum amount of $2,000.00 for violations thereof, providing a severability clause and an effective date. (PD20-0001c, Sagebrook, Hayley Zagurski). STAFF IS REQUESTING THAT THIS ITEM BE Page 6 Printed on 61512020 315 City Council Meeting Agenda June 16, 2020 POSTPONED TO A DATE CERTAIN OF JULY 21,2020. C. PD19-0005d Hold a public hearing and consider adoption of an ordinance of the city of Denton regarding a change in the zoning district and use classification of 10.49-acres from Planned Development-MR (PD-MR) zoning district and use classification and 1.523-acres from Mixed Use Neighborhood (MN) zoning district and use classification to a Planned Development (PD) zoning district on approximately 12.02-acres of land generally located on the southwest side of the intersection of the southbound I-35E service road and Buc-ee's Boulevard, in the City of Denton, Denton County, Texas; adopting an amendment to the city's official zoning map; providing for a penalty in the maximum amount of $2,000.00 for violations thereof, providing a severability clause and an effective date. The Planning and Zoning Commission recommended approval (6-1) (PD19-0005,Buc-ee's Outparcels,Cindy Jackson) D. CA19-0001b Hold a public hearing and consider adoption of an ordinance of the City of Denton, Texas, regarding a Comprehensive Plan Amendment from Business Innovation Future Land Use designation to Regional Mixed Use Future Land use designation. The site includes 3 tracts for a total of approximately 98 acres: Tract 1 includes one acre generally located at the northwest intersection of South Loop 288 and Shady Oaks Drive; Tract 2 includes 72.76 acres located at the southwest corner of South Loop 288 and Shady Oaks drive; Tract 3 includes 24.14 acres located on the south side of Shady Oaks Drive, approximately 1900 feet west of South Loop 288, in the City of Denton, Denton County, Texas; adopting an amendment to the City's Comprehensive Plan; providing for a penalty in the maximum amount of$2,000.00 for violations thereof, providing a severability clause and an effective date The Planning and Zoning Commission voted (6-1) to approve the request. (CA 19-0001b, Canopy Trails,Julie Wyatt). E. Z20-0002b Hold a public hearing and consider adoption of an ordinance of the City of Denton, Texas, regarding a change in the zoning district and use classification on approximately 98 acres from Light Industrial (LI) and General Office (GO) to Mixed-Use Regional (MR). The site includes 3 tracts: Tract 1 includes one acre generally located at the northwest intersection of South Loop 288 and Shady Oaks Drive; Tract 2 includes 72.76 acres located at the southwest corner of South Loop 288 and Shady Oaks drive; Tract 3 includes 24.14 acres located on the south side of Shady Oaks Drive, approximately 1900 feet west of South Loop 288, in the City of Denton, Denton County, Texas; adopting an amendment to the City's official zoning map; providing for a penalty in the maximum amount of $2,000.00 for violations thereof, providing a severability clause and an effective date The Planning and Zoning Commission voted (6-1) to approve the request. (Z20-0002b, Canopy Trails,Julie Wyatt). 7. CONCLUDING ITEMS Page 7 Printed on 61512020 316 City Council Meeting Agenda June 16,2020 A. Under Section 551.042 of the Texas Open Meetings Act, respond to inquiries from the City Council or the public with specific factual information or recitation of policy, or accept a proposal to place the matter on the agenda for an upcoming meeting AND Under Section 551.0415 of the Texas Open Meetings Act, provide reports about items of community interest regarding which no action will be taken, to include: expressions of thanks, congratulations, or condolence; information regarding holiday schedules; an honorary or salutary recognition of a public official, public employee, or other citizen; a reminder about an upcoming event organized or sponsored by the governing body; information regarding a social, ceremonial, or community event organized or sponsored by an entity other than the governing body that was attended or is scheduled to be attended by a member of the governing body or an official or employee of the municipality; or an announcement involving an imminent threat to the public health and safety of people in the municipality that has arisen after the posting of the agenda. B. Possible Continuation of Closed Meeting topics,above posted. CERTIFICATE I certify that the above notice of meeting was posted on the bulletin board at the City Hall of the City of Denton, Texas,on the 12th day of June,2020 at CITY SECRETARY NOTE: THE CITY OF DENTON'S DESIGNATED PUBLIC MEETING FACILITIES ARE ACCESSIBLE IN ACCORDANCE WITH THE AMERICANS WITH DISABILITIES ACT. THE CITY WILL PROVIDE ACCOMMODATION, SUCH AS SIGN LANGUAGE INTERPRETERS FOR THE HEARING IMPAIRED, IF REQUESTED AT LEAST 48 HOURS IN ADVANCE OF THE SCHEDULED MEETING. PLEASE CALL THE CITY SECRETARY'S OFFICE AT 940-349-8309 OR USE TELECOMMUNICATIONS DEVICES FOR THE DEAF (TDD) BY CALLING 1-800-RELAY-TX SO THAT REASONABLE ACCOMMODATION CAN BE ARRANGED. Page g Printed on 61512020 317 FUTURE WORK SESSION ITEMS MATRIX As of June 5, 2020 Meeting Date Currently Slated Work Session Items Urban Forset Master Protest and 6/9/2020 COVID-19 Update EV Charger Upgrade Sustainable Denton Plan Plan Demonstration Update Start @ 1 p.m. 20-944 20-732 20-521 20-426 20-111 Business Utilization of Parking Spaces IRO to COVID-19 Update Green Tree Estates Extend Outdoor Seatin Gas Wells CIP Update Council Requests 16-Jun 20-945 20-965 20-1102 20-1067 20-888 20-673 Audit-Grants Denton Development Eagle Substation Solar Rebate Program Audit-Water Loss Management Audit-Customer Service Code Amendments Council Requests 23-Jun (+Closed Meeting) 20-996 20-1009 20-1078 20-1079 20-1024 20-674 Special- Budget Workshop FYs 19-20 and 20-21 @ 1 p.m. Budget Updates 6/30/2020 20-806 6,7& 14-Jul No meetings-Council Break Drop-Off Recycling COVID-19 Update Green Tree Estates Centers Denton Development Council Requests July 21 21-Jul 20-1046 20-966 20-768 Code Amendments 20-847 COVID-19 Update Green Tree Estates Council Requests July 28 28-Jul 20-1047 20-967 20-848 23-J u I (Thursday) Budget Workshop Accessory Dwelling Units, and Screening Construction Code Group Home Code Library Master Plan DCA19-0011 Review (TBD) Delegated Authority Amendment 20-526 Aug 3- Luncheon i Q) Municipal Broadband Right of Way Ordinance Council Requests Aug. 4 20-556 Plugged Gas Wells Public Art Follow-up Stormwater Master Plan 20-1048 a m r 2020 Mobility Plan •0 4.0 TIF Grants for Update' CA Q Accessibility 20-245 Aug 6- Budget Workshop f� Council Requests Aug. 11 O 20-1049 0 ----- -------------------- Council Requests Aug 18 20-1050 Council Requests Aug 25 20-1051 Work Session Requests Veteran Source of Determined by Council Community Public Art Income Housing and Community Tree Ethics Ordinance Small Cell Lawsuit Discrimination Date TBD Grants Revision Participation Tree Ordinance Review Ordinance 318 Street Closure Report IMPROVING �l of Upcoming Closures a L�r) DENTON Week of June 8, 2020 -June 14, 2020 Tq Street/intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact Bonnie Brae IH 35E Scripture 06/15/20 03/01/21 North South Water Main Phase Engineering, Direct business contact (940) 349-8938 3 Water Water Distribution will be Cherrywood Ln Woodland St Roberts St 06/15/20 07/29/20 installing a new water main and Water N/A (940) 349-7278 water services. 135E northbound service 500 ft west Wastewater Improvements road located of Bonnie TBD TBD (Temporary Lane Closures) Wastewater (940) 349-8909 Brae Robson East Side of 35W TBD TBD Wastewater Main Install Wastewater (940) 349-8909 RR (Temporary Lane Closure) Rockwood Ln. Royal Mistywood TBD TBD bundle Engineering this will be part of bundle Door Hangers Drainage and Roadway Roselawn Dr. Bonnie Brae Kansas City TBD TBD Construction Engineering Part of Bonnie Brae Ph. 1 (940) 349-8910 Southern RR Bonnie Brae Phase 1 Capital Project (One Lane traffic control) Royal Ln. Royal Rockwood TBD TBD bundle Engineering this will be part of bundle Thomas St. Panhandle Oak TBD TBD Streets Construction Capital Projects Part of 2019 Street (940) 349-7104 Bundle Windsor E. Sherman Nottingham 06/15/20 08/01/20 This closure is to install Engineering NextDoor (940) 349-7426 underground utilities in this area Cherrywood Water Distribution will be Woodland St Frame St Ln 06/15/20 07/29/20 installing a new water main and Water N/A (940) 349-7278 water services. Total 8 Upcoming Closures 319 Street Closure Report IMPROVING =- "' Current Closures DENTON Week of June 8, 2020 -June 14, 2020 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact Concrete Sidewalk Repair. The process starts with Barricading Broken Arrow Dunes Old Orchard 05/11/20 06/12/20 the failed sections of concrete Streets N/A (940) 349-7146 sidewalk, remove , and install new concrete. Curb and Concrete Repair. The Broken Arrow Dunes Burning Tree 06/03/20 06/26/20 process starts with Barricading Streets N/A (940) 349-7146 the failed sections of, Curb remove and install back. Wastewater collections will be Brown Dr Roberts St Woodland St 02/10/20 07/10/20 installing a new wastewater Wastewater N/A (940) 349-8909 main line and services Concrete Sidewalk Repair. The Hickory process starts with Barricading Chaucer Hemingway Creek 05/11/20 06/12/20 the failed sections of concrete Streets N/A (940) 349-7146 Sidewalk, remove, and install new concrete Northwood Wastewater collections will be Cherrywood Ln Woodland St Tr 02/10/20 07/10/20 installing a new wastewater Wastewater N/A (940) 349-8909 main line and services 3201 Private Development: Drainage, Public Works Colorado Blvd Brinker Rd Colorado 02/17/20 06/12/20 Water, Sanitary Sewer, and Inspections, NextDoor, Direct (940)205-9230 Blvd Pavement for Fire Station #8 Private business contact Development 450 Feet This project will be removing the The project sent out a Colorado Blvd Loop 288 north of 05/18/20 06/26/20 left turn lane on the northbound Floyd Smith mailout and door (940) 349-7104 Loop 288 side of Colorado Blvd into the Concrete hangers when the first Mall. phase started in April. Concrete Sidewalk Repair. The Broken process starts with Barricading Dunes Arrow Windsor 06/03/20 06/26/20 the failed sections of concrete Streets N/A (940) 349-7146 Sidewalk, remove, and install new concrete Elm Hickory Prairie 05/11/20 06/19/20 PEC 4 Utility Project Engineering Direct business contact (940) 349-8938 City of Watch TXDOT message FM 2181 Denton/Cori Lillian Miller 11/18/19 TBD Street Widening TxDOT boards for local street (940) 349-8425 nth City closure updates. Ana Site Construction: Public Works Hickory Inspections, FM 2499 Pine Hills Creek Rd 03/27/20 07/01/20 Private NextDoor (940)205-9230 Water and Sewer Bore FM2499 Development Current Closures 320 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact Wastewater main replacement. Projects extents, Emerson from Emerson Circle to Foxcroft. Emerson Circle from Emerson Foxcroft Cir Emerson Ln Emerson Ln 01/30/20 07/17/20 to End Wastewater N/A (940) 349-8909 Foxcroft from Emerson to Northcrest Foxcroft from Old North to Emerson Water Distribution will be Foxcroft Cir Emerson Ln Emerson Ln 03/09/20 09/17/20 replacing the water main and Water N/A (940) 349-7278 water services. Ft. Worth Dr. (US 377) IH 35E Mission St 10/17/19 11/27/20 Infrastructure Safety Upgrades TxDOT (940) 349-8938 (temporary closures) 0.26 mi Street Widening Ft. Worth Dr. (US 377) IH 35E south of FM 12/03/18 12/12/20 (Temporary Lane Closures TxDOT 10/08/19 (940) 387-1414 1830 during non-peak traffic) Installing Valley Gutter across Greenwood at the intersection of Kayewood. The process Greenwood Kaywood Crestwood 06/15/20 07/03/20 starts with barricading then Streets N/A (940) 349-7146 remove pavement and subgrade and install new concrete Valley Gutter. Completed removal and replace E. Sherman Huntington 06/04/20 07/31/20 of Hercules Lane in conjunction Public Works Email Notification, Door Hercules Lane Dr. Dr. of the added turn lanes for the Inspections hangers (940) 391-6299 Sherman Crossing project. Concrete Sidewalk Repair. The process starts with Barricading Hickory Exposition Bradshaw 06/08/20 06/26/20 the failed sections of concrete Streets N/A (940) 349-7146 Sidewalk, remove, and install new concrete Intersection back of Intermittent closures of this NextDoor, Email Hidden Meadows Trail with Vintage Vintage blvd 03/16/20 07/03/20 intersection for construction Engineering (940) 349-8938 Blvd right of way activities Notification Tennyson Water Distribution will be Hollyhill Ln Longridge Dr Trl 03/06/20 06/12/20 replacing the water main and Water N/A (940) 349-7278 water services. Current Closures 321 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact Construction is continuing thru COVID- 19. Please respect workers efforts in the field and always maintain social distancing. 6/3/20 - New work near Bonnie Brae and US 377/Fort Worth Drive is underway. Work will be Install approximately 14,000 in the ROW but may Southwest linear feet of 24-inch and 30- impact shoulder and John Paine Road Pump Johnson 01/06/20 07/31/20 inch water main along Old John Water occasional travel lanes NextDoor (940) 349-8925 Station Road Paine and Allred between the for equipment/material Southwest Pump Station and deliveries. South Bonnie Brae. 5/12/20 Update - Partial Opening Goal: John Paine from Johnson north to Allred/John Paine near IH 35W may be ready to re-open End of May. John Paine Road from Johnson Road south will remain closed but is still scheduled to re-open July 31. Install new storm drain from the Johnson St. Smith St. Daugherty 05/18/20 07/02/20 intersection of Smith and Drainage NextDoor (940) 349-7197 St. Johnson to the intersection of Johnson and Daugherty. Kerley Street Duncan Shady Oaks 02/05/20 07/31/20 Street Reconstruction Streets (940) 349-7146 Street Drive 5/28/20 - Contractor Locust St. Oak McKinney 04/13/20 06/13/20 Sidewalk Improvements Engineering delayed due to weather (940) 349-8910 and COVID related work slowdowns. Storm drain improvements as part of Pec-4 Ph 1&amp;2 Locust St. Warren Ct. Maple 03/09/20 06/19/20 Project. West side lane closure Engineering Direct business contact (940) 349-8938 until May 12th Changing to Eastside lane closure until May 29th. Concrete Sidewalk Repair. The process starts with Barricading Mantan Calvert La Fonda 05/11/20 06/12/20 the failed sections of concrete Streets N/A (940) 349-7176 Sidewalk, remove , and install new concrete We will be reconstructing Direct business contact, Masch Branch U S 380 Jim Crystal 02/17/20 07/17/20 Masch Branch from 380 to Jim Streets Door hangers (940) 349-7146 Crystal. Current Closures 322 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact Intersection back of Intermittent closures of this Email Mockernut Rd. with Vintage Vintage 03/16/20 07/03/20 intersection for construction Engineering NextDoor, (940) 349-8938 Blvd. Blvd. right of activities. Notification way Concrete Street Panel and Sidewalk Repair. The process Moss Creek Ft. Worth Dr. Bent Creek 05/11/20 06/12/20 starts with Barricading the failed Streets N/A (940) 349-7146 sections of concrete pavement, remove the pavement, and install new concrete. Public Works N. Bell Ave Texas College 02/28/20 07/01/20 Building out west side of Inspections, NextDoor (940) 205-9230 building Private Development Concrete Street Panel and Sidewalk Repair. The process N. Carroll W.Oak McKinney 06/08/20 08/28/20 starts with Barricading the failed Streets N/A (940) 349-7146 St. sections of concrete pavement, remove the pavement, and install new concrete. Prairie Elm Pierce 06/01/20 06/19/20 PEC 4 Utilities Engineering NextDoor, Direct (940) 349-8938 business contact Prairie Locust Wainwright 06/01/20 06/19/20 PEC 4 Utilities Engineering NextDoor, Direct (940) 349-8938 business contact Storm drain improvements, as Prairie St. Locust St. Elm St. 03/23/20 08/28/20 part of Pec-4 Ph 1&amp;2 Engineering Direct business contact (940) 349-8938 Project. Street closed to thru traffic. Cherrywood Wastewater collections will be Roberts St Bell Ave Ln 02/10/20 07/10/20 installing a new wastewater Wastewater N/A (940) 349-8909 main line and services. Roselawn Bonnie Brae Bernard 05/12/20 06/12/20 Bonnie Brae Phase 1 Engineering NextDoor (940) 349-8938 The 2019 Street Reconstruction project consists of the reconstruction of roadways listed above. This Thomas reconstruction shall include new NextDoor, Email Scripture Street Street Malone 03/16/20 06/30/20 curb and gutter, ADA compliant Engineering Notification (940) 349-7426 ramps in sidewalks, asphalt or concrete roadways as well as upgraded drainage, water and wastewater facilities intersection back of Intermittent closure of the NextDoor, Email Shagbark Dr with Vintage Vintage Blvd 03/16/20 07/03/20 intersection for construction Engineering (940) 349-8938 Blvd right of way activities. Notification Current Closures 323 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact North South Water Phase 2 - Installation of 42"Water Main: Bonnie Brae is closed for South Bonnie Brae FM 1515 Walt Parker 06/05/20 06/10/20 pavement restoration efforts Engineering Email Notification (940) 349-7713 between FM1515 and Willowwood Street. Part of ongoing closures as street restoration is performed. Concrete Sidewalk Repair. The process starts with Barricading the failed sections of concrete Vista Verde Montecito Intersection 06/08/20 06/26/20 Sidewalk, remove, and install Streets N/A (940) 349-7146 new concrete Also installing Valley Gutters across Vista Verde at the intersections Warren Ct. Wainwright Locust St. 12/16/19 07/31/20 Drainage Improvements as part Engineering Closed to thru traffic Direct business contact, (940) 349-8938 St. of Pec-4 Ph 1&2 Project door hangers Installation of sewer and water Windsor Drive North Locust Stuart 05/11/20 07/01/20 facilities. Engineering NextDoor (940) 349-7426 Windsor Drive - Closed EB - Open one Way WB Cherrywood Wastewater collections will be Woodland St Brown Dr Ln 02/10/20 07/10/20 installing a new wastewater Wastewater N/A (940) 349-8909 main line and services Total 43 Current Closures 324 Street Closure Report IMPROVING 4colt", Completed Closures TIL� DENTON Week of June 8, 2020 -June 14, 2020 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact Concrete Street Repair. The process starts with Barricading 941 Precision Airport Rd W. Oak St. 04/20/20 05/12/20 the failed sections of Streets N/A (940) 349-7146 pavement, remove the pavement and subgrade, and install new concrete pavement. Public Works Ave. C 1-35 Eagle 04/28/20 05/29/20 Garage completion and tear Inspections, NextDoor (940) 205-9230 down of crane on private Private Development Concrete Street panel and Sidewalk repair. The process starts with barricading the failed Bent Creek Kappwood Spring Creek 01/06/20 04/24/20 sections of concrete pavement, Streets N/A (940) 349-7146 remove the pavement and subgrade, and install new concrete pavement. PEC 4 1&amp;2 Drainage and West bound Traffic Eagle Elm Locust 03/30/20 05/29/20 Utility Improvements Engineering being detoured down NextDoor, N/A (940) 349-8938 Locust to Maple to Elm. From 1/13/20 to 3/8/20, City's Contractor will be clearing trees and vegetation along the south side of Hickory Creek Rd., from the west property line of McNair Elementary School to the Riverpass Dr. intersection. This will Hickory Creek Rd. Teasley Riverpass TBD TBD Street Widening Engineering not involve any lane Phone call to McNair (Temporary Lane Closures) Elementary Principal (940) 349-7112 closures, but construction zone signage will be put up to warn motorists. Atmos still needs to relocate their facilities east of the Montecito intersection before our Contractor can fully deploy to the project. Completed Closures 325 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact 5/20/20 Update - Project is still on schedule to re-open Johnson Road on May 31, 2020, Ideally sooner if weather/work permits. 3/25/20 Construction is continuing thru COVID-19. Please respect workers efforts John Paine Just west of in the field and always maintain Johnson Lane Road first driveway 01/06/20 05/31/20 social distancing. Water NextDoor (940) 349-8925 Road closure is for the installation of new water main along Old John Paine Rd. and Allred Rd. between the Southwest Pump Station on John Paine Rd. near Parkplace Dr. and South Bonnie Brae St. Atmos Energy is relocating/ Direct business contact, Daughtery replacing existing gas mains Atmos Energy to Johnson Street; Smith Dallas Drive Street, at S 04/06/20 07/31/20 Atmos and services for upcoming distribute door hangers, Street Locust reconstruction of Smith Street; place sign boards, and (940) 268-7285 Street including gas main crossing notify residents in Johnson Street at Smith Street. person Sewer main improvements, as Locust St. Highland St Eagle Dr 03/09/20 05/29/20 part of Pec-4 Ph 1&amp;2 Engineering Direct business contact (940) 349-8938 Project. West side lane closure. Longridge Woodbrock Hollyhill Ln. 04/20/20 05/08/20 Emergency repair of drainage Drainage N/A (940) 349-7197 St. system This project is to install a drive 225 west of approach at the Golden Triangle Engineering, Floyd Smith concrete will Loop 288 Colorado Colorado 03/16/20 05/15/20 Mall as part of the Colorado Floyd Smith resume work on this Direct business contact (940) 349-7104 blvd Blvd and Loop 288 intersection Concrete project April 6th 2020. improvements. Water Line improvements, as Maple St. Elm St. Myrtle St. 02/24/20 03/06/20 Part of Pec-4 Ph 1&amp;2 Engineering Direct business contact (940) 349-7112 Project. Alternating lane closures. Installation of new storm City PM will contact Montecito Dr. Hickory Buena Vista TBD TBD drainage line. Full street Engineering McNair Elementary (940) 349-7112 Creek Rd. Dr. closure. Principal again on 2/7/20. Water Distribution will be Old North Rd Chebi Ln Emerson Ln 05/18/20 06/05/20 replacing the water main and Water N/A (940) 349-7125 water services on Foxcroft. Completed Closures 326 Street/Intersection From To Closure Closure Description Department Upcoming Public Other Department Start Date End Date Info/Notes Meeting Communication Contact Curb and Gutter Repair. The process starts with Barricading the failed sections of, Curb and Pembrooke Chasewood Long Ridge 04/20/20 05/29/20 Gutter remove and install Streets N/A (940) 349-7146 Curbs. Also Mill and Overlay section of Street that was impacted with the curb repair. Installation of new storm Hickory Marble Cove TBD TBD drainage line. Intersection Rushing Springs Dr. Creek Rd. Ln. closure. Traffic will be detoured Engineering N/A (940) 349-7112 to Serenity Way. Water main improvements Alternating East and Direct business contact, S. Elm St. Prairie St. Eagle 03/16/20 05/29/20 along Elm St. as part of the Pec- Engineering West side lane closures Door hangers (940) 349-8938 4 Ph 1&2 Project. S. Locust St. Warren Ct. Maple 12/16/19 05/08/20 Drainage Improvements as part Engineering West side lane closure Direct business contact, (940) 349-8938 of the Pec-4 Ph 1&2 Project. Door hangers The 2019 Street Reconstruction project consists of the reconstruction of roadways listed above. This reconstruction shall include new curb and NextDoor, Email Thomas Street W. Oak Panhandle 03/16/20 06/15/20 Engineering Notification, Direct (940) 349-7426 gutter, ADA compliant ramps in business contact sidewalks, asphalt or concrete roadways as well as upgraded drainage, water and wastewater facilities PEC 4 Drainage project. Road Eastside Lane closure Wainwright Highland ct Warren ct 04/27/20 05/29/20 Reconstruction Engineering for pavement repair only. N/A (940) 349-8938 Total 19 Completed Closures 327