EWEB Board of Commissioners — August 4, 2026

0:04 Gene one electric board to uh order. The first agenda item is a facility and safety awareness and meeting logistics briefing. I'd like to thank everybody for attending tonight's board meeting. Eb management and subject matter expert are present in the room and virtually. The meeting is being streamed live and recorded. Please speak loudly and clearly so everyone can hear you. Public testimony is welcome. Signum forms are available back at the back of the room. Visitor access is limited to the board meeting room and restrooms. Restrooms are located on the first floor through the exit right hand door at the front of the room and across the hallway. In the event of emergency such a fire or security incident, follow all instructions given by staff. If evacuation is required, please call me, proceed to the nearest safe exit as identified, directed by staff, and evacuate away from the building to the farthest points in the parking lots to allow clear and immediate access for the first responders. Okay, the first agenda item is the

0:50 agenda check. Does anybody have any corrections or additions or want to move anything around? If not then next item is the items from board members. Mindy >> anything >> I have nothing. John is to you. >> I won't say I have nothing. So good afternoon. I just wanted to touch on a couple of things. One if you can uh if you looked at the items that I had during the Oh, sorry about that. Um you know just wanted to touch on a couple things. If you notice the items I had um in terms of engagements during the past month um it was you know quite a few I think um when I looked at it I realized wow you know been getting out but it's really consistent with the

1:36 commitment that I made to you all and u making sure that I'm out engaging with the community leaders and stakeholders. Uh so um it's pretty evident that I've been getting out there doing that. I think of note I wanted to mention um that I did meet with the new GM over at Springfield um Vanessa um Barbaresi and I'm looking forward to a really good working relationship um with her. We have mutual interest. So um that meeting went well. Um also had an opportunity to um go out and meet with the um folks at the Southern Valley Innovation Corridor stakeholders. um you know again a good meeting with folks who are focused on economic development for um Eugene Springfield and Lane County. So I was

2:22 really impressed with the um leadership and the focus that they have on bringing economic opportunities to um this area and I also see Eb as being an important piece to that economic engine. So um really important meeting and engagement. And then lastly, I'll just mention that I had an opportunity to spend time with state senator James M. um and city councelor Matt Keating. Uh we provided their staff with a tour of Hayden Bridge and um I think it was very informative for the senator and look forward to further engagements with him. So um you know really important engagements there. The other thing I'd mention is just with uh the weather and the conditions that we have around wildfire. Um the recent red flag warnings um you know obviously

3:09 we take our responsibilities to the community very seriously. Um in response to yesterday's red flag warning um we stood up a warm IC and moved all circuits um within the identified high fire risk zone um to wildfire safety settings. Um so from a technical perspective these settings mean that power lines operate at a higher sensitivity um reduce the chance you know of a spark or something else really creating a fire. Uh so uh we wanted to make sure that you all are aware that as we move into this season and it seems to be one that's stacking up to be one of the worst on record. um we're doing everything we can to prepare and u prevent anything from our system um

3:55 igniting and also um doing things from a veg management perspective that protects the system itself. And then the last thing I think um you all have been aware of what's been going on um regarding the recent cyber uh attacks on water utility systems. And so just as a note to the board, we are very mindful of that. um can't really um disclose all of the things that we're doing um because there's bad actors out there and are trying to penetrate our system, but we just want you to know that we're working with um authorities and our IT team has focus on that effort. So, um just those are the items I wanted to make sure uh we made note to the board. >> Thanks. >> Thank you. I've always forget something so I forgot so I'm jumping back in. Um

4:42 downtown we I'm have an office downtown and it seems like randomly for like the last six months we e webb has been shutting down 8 and pearl the pearl to one lane and 8 they shut it down at at the berry street off ramp and it's like a six blockous route to get around and on especially on Tuesdays when they have protest Tuesday and they have farmers market it's a mess and I've got people asking me how long is this going to go on and it doesn't seem like there's a project they just set up a tent over a manhole and I I wouldn't pay you couldn't pay me enough to get down where they're doing and I know it's necessary work, but is there some way we can get the downtown um tenants to can find out when that's going to be over or what's going on? I mean, because it's they've been asking us, I don't have a clue, but it's but when they bust it down to one lane and shut 8th Avenue down totally, it's it's challenging.

5:28 >> Yeah. So, we can absolutely let that information and let you know. >> That'd be great. And then I can pass it on to DEI. Thank you very much. Anything else from anybody else? >> Not the next agenda item is yours again, John. It's correspondence. All right. So, um, we had three items on correspondence. They were pretty straightforward. So, I don't know if I need to take a ton of time going through them. I would just, um, ask if there's any questions regarding either the harvest wind update or the, um, system config configuration for billing, um, due dates or the WAMIC treatment plant communication plan. Um, the only thing I would really mention, I know what came up last week or last month was a question regarding the um, ability to change billing dates. And so as we look through it, um you can see that those are set up um you know according to

6:14 geographics. Um it does uh present some administrative challenges to be able to do that. But we do have a set of programs in place that really uh you know addresses most of the questions we get around changing billing dates um regarding um you know help or bill assistance um dealing with late fees etc. So, um, if there's any additional questions on that, um, you know, we'll be willing to entertain them, but it's it's, you know, pretty straightforward in terms of how we, um, handle those, um, billing dates. >> If not, then the next agenda item is going to be the public input. And before I open the public input session, I'll um, read the preamble. I'd just like to welcome you to the public input session

6:59 for this meeting. EW Webb is a public not for-profit organization whose charter is to deliver drinking water and electricity to our community. Although this forum is not used for an open back and forth dialogue, commissioners and staff have value hearing diverse perspectives and receiving community input. Speakers are asked to keep their testimony relevant to EW web business and request that everyone share their comments in a productive and respectful manner. Should speakers or audience members become disruptive, they may be muted and or removed from the meeting. Um when your name is called you'll have three minutes to provide your name provide your comments and public session is now open and do I have uh people online and >> one on the phone and one in person. So I'll go to the phone line first is Andrew Simron.

7:52 Andrew can you unmute yourself if you could please? Andrew's still there. >> Andrew, I see you on the line, but it looks like you're muted. So, if you could press star six to unmute. >> Can you hear me? >> Yeah, we can now. All right. Go ahead, Andrew. >> Okay. Hi. Yes. Hi, my name is Andrew Simmerman. I live in Ward 7 in the River Road neighborhood. Um I'm uh calling the uh board of commissioners uh to adopt a large tar load tariffs for uh data centers and large uh energy users. Uh we know that data centers use large amounts of power sometimes even more than industrial uh users in the area. Um, I

8:39 currently work in IT and have worked in data centers locally in the Eugene area and I know the immen immense amount of power and cooling that is needed for these things. Um, I'm trying to stay cool right now. I don't have air conditioning in my home and uh the the Mackenzie River is nice and cool right now. I love that uh we have a healthy salmon population up coming up through here and I want to help preserve that and data centers uh will increase our uh overall usage of the river system for its hydroelectric power as well as you know cooling and other water needs. But

9:24 um it would really help uh those that are energy burdened and would help the just everyday rateayers not have to bear the burden of these uh mega consumers of the power and water resources. Uh you know I get my water from a rural water district as you probably know the river water district. I don't know where I am in standing to get water. Uh but anyway, just wanted to mention that. Thank you for the opportunity to provide input. >> Thank you very much. Um the next speaker is Dylan Plamer.

10:21 Members of the U Web board, my name is Dylan Plamer. I'm here in my role as deputy director of the Sierra Club's national clean heat campaign. Sierra Club is a national environmental organization with over 80,000 members and supporters in Oregon and over 10,000 members here in Eugene. I'm also an EW Webb customer and a resident of Eugene in W 2. I'm testifying today to call on EW Webb to take actions to protect residential rateayers and to establish policies to redistribute the cost of the energy system in order to ensure that the largest users pay their fair share while reducing for lower uh while reducing costs for low-income households. In light of the boom in data center development in Oregon and the recent zoning verification request sent to the city of Eugene inquiring about the possibility of developing a data center on Willow Creek Circle, the EW board must pass a resolution publicly

11:07 opposing data center development in our community. And additionally um established guardrails to ensure that any data center developers are fairly charged for the energy and water that they use and they pay for any infrastructure upgrades required um for their development. Specifically, EW Webb should look to replicate the provisions of the recent large load tariff framework approved by the Oregon Public Utilities Commission for Portland General Electric in response to the 2025 state power act. These measures are critical to ensure that our community's opposition to these facilities made clear and that if data centers are developed in Eugene, residential and commercial rate payers are not unnecessarily burdened with increasing rates to pay for additional generation and transmission resources necessary to serve these facilities. These measures are also critical to ensure that data

11:52 center developers do not flock to Eugene as a haven to avoid the consumer protections required by the power act legislation in investorowned utility distribution areas. Thank you very much for your consideration. >> Thank you. >> Is there anybody else that would wish to address the board this evening? >> If not, then I'll close the public hearing and I'll ask for comments from commissioners. Anybody have any response? Tim? >> Thank you. [clears throat] Yeah. Uh thank you Andrew and Dylan for coming and testifying. Uh want to share with the board that the vast majority of almost exclusively all the conversations I'm having uh at neighbor associations and with constituents have been about data centers. And so it's just top of mind I think for for our community. So I want to flag that. I think it's something that uh I know is early in the

12:38 city of Eugene's process for the zone verification but uh yeah it seems very very top of mind for for us here. Yeah. Thanks. >> Anybody else? Sonia >> just wanted to appreciate coming out and talking about these you know really critical topics. So thank you. >> If not then next agenda item which is uh consent calendar approval of consent calendar A. If anybody doesn't want to pull anything or discuss it, then I would entertain a motion. >> I move to approve. >> Second. >> Okay. Discussion. Not. All those in favor signify by

13:23 saying I. >> I. Passes unanimously. Consent calendar B. >> Move to approve consent calendar B. >> I'll second that. Discussion. Hearing none. All those in favor signify by saying I. I >> opposed. Nope. Passes unanimously. Moving right along. Agenda item number eight, water integrated capital and financial plans. This is a direction item scheduled for 60 minutes.

14:25 right. Good afternoon. For the record, I'm John Harrison, CEO and general manager of EW Webb. Joining me today is Deborah Hart, our assistant general manager and CFO, and Karen Kelly, our chief operating officer of the water utility. So, according to board policy SD6, um financial policies in Oregon statutes require staff to prepare balanced utility budgets for board approval by the end of the calendar year. Um the electric um capital improvement plan or long-term financial plan was presented separately last month. Tonight uh we're seeking the board's direction on the water system investments that we're planning to make. We plan to discuss the investments priorities behind the water capital

15:10 improvement plan, the tradeoffs and u what's being deferred, the financial pressures uh this plan puts on the utility and the levers available to manage those pressures. U the topics are covered in detail in the memo included in your board packet and posted u to the public on our website. Now shown on this slide is a rendering of the new water intake on the Wamtt River. The Wamtt treatment plant is the largest um project in the water utilities uh I would say recent history as a minimum. Now, I want to begin by providing some context and situational overview for the board and the public. Um, first, EW Webb's water rates are not in line with

15:56 the um cost of service that we're projecting. Um, since 2016, the water specific consumer index um CPI measures has risen u 55%. That's the chart in the upper right. Um e webb rate increases for water services over the same period u were about 40%. Now staff and um the board worked um pretty diligently to keep water rates low for customers including 5 years of no rate incre increases between 2017 and 2021. However, the scale of the capital investment required means uh we need to increase our revenues to support the needed investments. Now these increases will impact our customers and as you can see here um many other utilities have

16:43 already increased the rates to account for the required um water system investments. Now um I would like to say that we need to play some catchup but obviously you still want to keep your rates low. So we want to make the right investments at the right time to achieve our um our intended goals. Now, this slide illustrates um some of the competing pressures that we're facing um as the utility. Um we shared a similar slide with this at last month's discussion um with the electric capital plan, but it it really bears repeating and some of the um challenges that we're facing with the water system, I would say, are unique. Um, as we discussed last month, EW Webb needs to establish a

17:30 second source of water to overcome uh water system challenges. And most importantly, we need the ability to be able to take our existing plant offline for u required maintenance. And we are also coming up with big deadlines related to water rights and permitting. And they are putting timeline pressure on our actions. across the industry. Project costs are escalating due to larger um economic factors outside of our control. Uh risks to the system are growing uh which compel us to act I think a lot quicker than probably we would like and but it's necessary. Additionally, I think it's worth emphasizing that federal support for um generational projects like this has faded away over the uh past few decades.

18:17 federal capital funding um is down uh from about 50 to 60% in the 1970s and 80s to just about 7% today. Um this is putting more pressure on local communities than ever before and all this is happening against the backdrop of a need for affordability. Now our core responsibility is to keep the power on and the water flowing. Our customers are consistently ranking affordability and reliability as their top priorities, but there is an inherent tension between the two. Now, we know that every dollar of investment eventually shows up on our customer bills, and we must consider um the community's realistic ability to

19:02 afford what we're asking them to pay. Now, this year's electric and water plans include deferring about $und00 million in large infrastructure projects um spreading out or delaying work where it's safe to do so. Um specifically to soften the impact or the rate impacts to our customers. Now, while the water utility has deferred um where they can, the Wamid treatment plant is an investment that we cannot um avoid. It is something that we absolutely have to do. Now I like this slide because when it comes to the water um capital improvement plan um the wignment treatment plant is really something that

19:48 is outsized. U it represents roughly twothirds of the budget for the next decade and the costs are concentrated in the first five years. Now, last month, staff presented a detailed comparison of four different treatment plants ranging from 10 to 30 MGD capacity um including preliminary construction estimates um that and and that's really the con the preliminary construction estimate is in step one. Now, following an in-depth discussion, the board provided preliminary direction to the staff to pursue the 30 MGD plan. Now since then um staff has taken the next step in the process um completing a more detailed cost analysis incorporating overhead inflation consulting time and other

20:33 costs to arrive at a total project cost estimate as depicted in step two. Now the numbers we're sharing tonight while significantly more refined than last month's um are still not final. Uh final cost won't be known until we complete our work with the design engineers, the CMGC and owner's rep. Um a process expected to take around 18 months. Um at which point the board will have a guaranteed maximum price. And as the process moves forward um we expect numbers will uh be refined but uh but not fundamentally change from what you see today. Now, as um we've discussed last month, commissioners will have a decision stage gate in 2027 or early

21:19 2028 to approve the guaranteed max price. Now, that said, uh we feel it is important to have cleareyed view of all the potential costs as we dig into budgeting, rate trajectories, and the impacts to the financial health metrics of the water utility. Now shown on this slide are total estimated project costs for two treatment plant capacities 19.4 MGD and 30 MGD. Now last month we presented preliminary construction costs in today's dollars for different treatment plant options shown as um as the first row in this table. The um 337

22:04 million u for the 19.4 4 MGD and the 392 million for the 30 MGD. Now, those numbers have not changed since last month. Our updated numbers account for inflation, overhead, and the cost of e-web and consultant labor to develop conservative all-in project costs of 431 million for the 19.4 MGD and 498 million for the 30 MGD. Now, as noted, overhead is an existing e-web cost that is already part of our budget. Now, per policy, overhead is allocated to this project. Um, the same way it would be for any other of our capital projects. And as you can see, um, there is over a

22:50 100 million in contingencies and inflation assumptions in both estimates. And this is a buffer for uncertainty in the scope estimating accuracy um in case the actual costs are more than currently estimated. And consistent with prior years in standard practice, the budget and the long-term financial plan are built based on total estimated costs. Now, prior to this meeting, uh we completed an initial evaluation of financial health metrics for both the 19.4 for MGD and the 30 MGD plants uh which both meet project goals. Uh what we found is that both plants will create a strain on the water utility but the 30 MGD plant strains them more. That's

23:36 because the strain is driven by the amount borrowed. The larger the project, the greater the borrowing required. Now this slide reflects a series of cautions related to financial health resulting in significant investment in a new water treatment plant. And these metrics are important to monitor as you can see in the 30 MG plant stresses some of these factors to an extreme level. Now, additionally, it is important to understand that the risk is a factor of the cumulative effect of all of these flags, not any one single flag. Now, these financial metrics are um essentially able to get us to our ability to borrow responsibly and to cover what we owe. Now, I think um of it like buying a house. Uh a bank might

24:23 approve you for a million-doll mortgage. Um but just because you qualify doesn't mean you should tax yourself um you know to purchasing a house of that amount. Doing so would leave you out the room to handle anything like a job loss, uh medical bills, a new roof. And I think really the the same principle applies here. um is it's really a choice of whether we want to mortgage um our future ability to meet um maybe unseen needs or unforeseen needs. But the 30 MGD plant would put the water utility at the very top. Even though we can still afford them both, it still puts us at the very top of our borrowing limit, giving us uh less flexibility for other capital needs, including an emergency or

25:08 cost um that we can't predict yet. Now with that in mind, considering the total cost of their impact on EWE's financial metrics, staff has recommended pursuing the 19.4 MD option as it is the most prudent investment to meet the project goals. Now, this recommendation reflects priorities we know that are at the top of mind for the board, affordability and the long-term financial health of the utility. And tonight we're bringing this recommendation to the board for discussion and direction. Now with that situational overview and recommendation in mind, management tonight is um is really seeking the board's direction on the topic shown on

25:54 this slide. Now the capital investment plan directly determines how much e webb needs to collect from customers. So, we want to know if you support the priorities and tradeoffs included in this plan. Now, the capital plan includes investments in the 19.4 MGD plan, but staffs staff are prepared um to further discuss the 30 MGD U plant if requested by the board. We will present an initial illustrious view of the debt issuance and rate trajectory schedule for the water utility reflecting a baseline set of assumptions. A full developed optimized financial strategy will be presented in at the October meeting reflecting guidance received from the board this evening on financing

26:40 strategy and priorities for the water treatment plant. As you can see, we're looking at the 2027 revenue requirement of 19.75%. Um, tonight we want to roll up our sleeves and walk through the options to optimize the rate trajectory with your guidance. um there are tradeoffs u when it comes to the financing options for the water treatment plant and the uh overall capital improvement plan. So we want to make sure we get the direction from you before we move forward on developing specific scenarios. Um there is also a lot of complexity to financing or financial modeling. Uh so we want to come up uh with a plan before we actually begin digging into the modeling

27:25 aspects of this project. also shown um for the board and the public a reminder of the rate setting process um at which we are at the first step. Now this slide I think covers the process and timeline in more detail. Uh the capital improvement plan goals are the same um the board has seen in the past years with one addition. Um this year we included manage financial constraints reflecting the deferral and tradeoffs um covered in the memo and represents a direct effort to manage rate impacts to customers. Now there are several touch points for the board and the public to engage in the um budget and rate setting process up to and

28:11 including the December public meeting at which the board will be asked to approve the final 2027 budgets and rates. And with that, um, I will turn it over now to our chief operating officer of water, Karen Kelly, to discuss the capital plan and and what's included in it in more detail. Thanks. >> Good evening. Uh, the water utility 10-year capital plan reflects a deliberate source totap approach to system resilience. The top table shows I'm sorry. [laughter] Okay, now you can follow along here. The top table shows the capital plan and dollars needed to keep the drinking water system in a good state of repair and the most critical near-term projects needed to ensure safe, reliable water

28:57 continues to flow even as critical infrastructure ages and new challenges arise. The memo you received ahead of tonight's meeting presented the capital plan based on the 30 MGD investment. To give you a complete picture for this discussion, we're showing that alongside the staff recommended 19.4 for MGD option. Investing in water is not just a cost to bear. It is a tangible opportunity to strengthen the our community's quality of life, public safety, and economic vitality. Every dollar spent upgrading pipes, treatment plants, and distribution systems reduces the likelihood of costly main brakes, oil water advisories, and service outages that disrupt lives and cost millions. Regardless, we know increases will impact our customers. So, we have

29:42 paired back as much as we could without compromising system integrity. Balancing reliability and affordability can require difficult choices and some of the trade-offs are shown here on this slide. The plan includes 36 million in projects that are deferred 3 to 5 years. This required careful consideration of how projects interconnect and are sequenced. For example, since the new Wamit treatment plant will allow EW Webb to deliver water to base level reservoirs without crossing a river, we were able to push out two river crossing projects to later in the plan. This is the kind of trade-off staff have worked through project by project. The plan isn't based simply on what can be delayed, but what we can responsibly delay given how the whole entire system

30:28 functions together. Still the deferral of some of these high-cost projects, including the river crossings especially, will impact appropriate renewal and replacement cycles for our water assets uh later in the plant. We have said this before, but it bears repeating. The WAMIT treatment plant is the single most important investment that we can make for the water utility to defend against future risks. And that is why we are recommending allocating the bulk of the funds in the 10-year CIP for its completion. This investment will impact rates, but it will also bring immense value to our community, and it is an investment worth making. Here is the value our community can expect as a

31:13 return on this investment, which includes defense against extended water outages that could have a devastating impact on our community and local economy. And we can do this by providing a redundant source of water and treatment plant and in having a way to get base level reservoirs water without crossing river. It also keeps our largest and most critical water asset, the Hayden Bridge filtration plant in reliable service. We cannot plan and execute necessary repairs until we have a second plant to replace its production. The new plant will give us flexibility to start planning and executing strategic improvements to get the most out of that facility. And now I'm going to hand it over to Deborah to talk about the initial rate trajectories and financing options moving forward.

31:59 Thank you and thank you for advancing. >> I did. I learned my lesson. As is typical at this stage of the budget and rate setting process, we're presenting the long-term financial plan based on total estimated capital project costs. This slide presents our long-term financial plan based on a 19.4 MGD plant. It shows how the capital investments we've just reviewed, including our bond issuance schedule and resulting debt, translate into revenue requirements over the next 10 years. For this plan, we ran the rate calculation to show the rough impacts of financing a

32:44 19.4 4 MGD plant using bonds in a typical financing pattern. Because con construction is condensed in the first five years of the plan, significant increases are needed to raise revenues to cover debt service. This financing method is a good place to start um for us because it's a typical financing method for e webb and it um appears to result in the lowest overall cost. However, it would require rate increases that are larger than what e webb has implemented in the past. As noted on the slide, we've identified a re revenue

33:29 requirement increase of 19.75% over each of the next three years and the revenue requirement remains elevated through 2031 before dropping off sharply in 2032. This slide also shows the projected residential c customer bill at 9 kg gals of consumption. Um, now I've lost my um, and based on the overall revenue requirement. Uh, it's important to note once again that the next step in the rate setting process is allocating that revenue requirement across our customer classes. That hasn't been completed yet. So, the specifics for each class

34:17 may differ from this projection. And for the individual consumer um rate design will also play a role. The investment in the second treatment plant also strains some of the overall financial health metrics that are critical for us to continue monitoring. Uh John talked about those earlier in the presentation. As noted in the board memo, management is committed to evaluating financing tools, operating efficiencies, and cost savings opportunities informed by board direction on financing strategy priorities. Uh we look to bring this rate as low as practical by the October board meeting.

35:04 However, we do need additional guidance from the board on the direction that we should pursue to lower that rate impact. Before we switch to board discussion, we would like to spend a few minutes addressing the important issue of rate impacts on affordability. As noted, the WAMIT treatment plant is a critical legacy investment for this community that requires rate increases be beyond what e webb has implemented in the past. However, it is important to reiterate general manager Haristen's earlier point that e webb rates are artificially low as we have not kept pace with the rate of inflation in uh in the industry. If e webb rates had

35:50 mirrored inflation, we would be at $53 today, $8 higher than where we're at. Additionally, e webb's water rates are currently among the lowest in the region. The average residential customer you using 9,000 gallons per month, which is typical of a single family home with moderate outdoor usage, pays approximately $1.50 a day for water. Lower use customers, such as those living in an apartment with no outdoor water use, pay about a dollar a day for water. Most of the utilities in our regional comparators have already invested in multiple sources and their

36:35 rates reflect those investments. As shown in the graphic at the end of the 10-year CIP, the average single family household would pay approximately $3.40 for 300 gallons of water a day, about a penny per gallon. And for our final slide on rate impacts, uh we recognize that most of our customers pay for both electricity and water. And so it makes sense to look at the total bill impact. As noted last month, EW made deliber deliberate deferrals and is committed to future efficiencies and savings on the electric side to arrive at a rate trajectory that is more in line with the board's rate

37:20 guidance. As a result, the 2027 electric revenue requirement is three and a half percent. Because the water um utility makes up a smaller share of the average customer's total utility bill, even a large percentage increase on the water side translates to a more modest impact when the two bills are combined. The combined bill increase for the average residential customer using 9,000 gallons of water and 1,600 kilowatt hours of electricity is projected to be approximately 6.2%. There are some levers that the board can use to improve financial metrics and

38:06 influence the rate trajectory. The first is pursuing the 19.4 4 MGD plant option to reduce total overall project costs. As noted earlier in the presentation, total estimated costs for the smaller plant are 431 million compared to 498 million for the larger 30 MGD plant. There are also ways that we can structure financing to influence the rate trajectory. Long-term tax exempt bonds are our traditional approach and would likely remain the foundation of any funding strategy, but locking in long-term debt um means less flexibility if our needs or market conditions change. WIFIA,

38:52 which is a federal low interest rate loan program, offers long-term cost certainty and a longer window before repayment begins. But it comes with higher financing costs and added complexities with federal compliance and administrative requirements. Short-term capital financing tools can offer flexibility during construction, potentially lower near near-term borrowing costs, but they do introduce risk to interest rate changes, uncertainty around market access, and the need for active ongoing management. There isn't uh there isn't a single funding strategy that avoids trade-offs entirely. So the question becomes which

39:39 trade-offs make sense given the board's priorities. Ultimately the right approach may involve a mix of funding tools guided by the financial priorities that the board identifies here tonight. >> [clears throat] >> So this slide presents some example uh some example financing strategies priorities that the board may wish to consider in order to guide staff in developing the rate trajectory options that reflect the board's priorities and support eb's long-term financial resilience. Do want to note that they're not to scale. They're meant to be illustrative of the kind of rate trajectory um that we could drive

40:24 towards in our financing strategies. Option one is um essentially traditional revenue bonds with a level repayment schedule. Rates will need to rise sharply to meet the debt service requirements. And so this results in higher near-term impacts to the rate player. [snorts] uh but typically will provide the lowest overall cost. Option two would be a pattern of more gradual rate increases over time to get to the required revenues to meet the debt service. Lower interest short-term products and or deferring principal payments are the tools that we would have available to accomplish uh something similar to that.

41:11 The trade-off here though is likely higher cost overall and a longer period of relatively large rate increases. Then we have option three, which is a a more predictable and stable series of increases. The trade-offs here are similar to number two in that we would use short-term borrowing and deferring of principal payments to level and spread out the rate increases. And the likely outcome again would be overall an overall increase in financing costs. And then option four is borrowing less by deferring the construction to enable the utility to build some cash. Uh this

41:56 though delays perfecting our water rights and additionally exposes Zeb to more inflationary risk. So, with this context, we're really looking for your guidance. And so, I'm going to turn it back over to General Manager Haristen, uh, to tee up that discussion. >> All right. Thank you. Thank you, team. And so, um, at this point, uh, we are wanting to, um, you know, entertain any questions that the board may have. Um but in terms of just the guidance that we've um or the recommendations we've provided um obviously we came in to this with the direction from the board to vet a 30 MGD plant from last um the last

42:43 board meeting. We've done so. Uh we have identified some challenges that we wanted to bring to your attention and uh make a recommendation we felt was better in line with where we thought we needed to go as a utility. So uh with that uh we are looking for input from you on not only the direction on the size of the plant but also some of the um financing um strategies that we've uh presented today. >> Thank you. So this is we've got 60 minutes total. We got 30 left. There's five of us. Do the math. So we'll go one round of three minutes each and then we'll go the second round because I imagine some of you are going to have some comments and some questions. So I'll open the queue. Sonia.

43:36 >> Well, uh, at our last meeting, I was cautious around moving to the 30, um, as well. So, I'm, you know, with the change in the costs and the additional um, look, which I appreciate that staff went back and did. I know that these are massive projects and this isn't something that we've done in a very long time and um I I appreciate the full picture and I expect that you know this is not the end all. It will change as we get more information throughout. Uh but I am supportive of moving to the uh 19 over the 30 especially because um what I've what I noted last time as well was that the um we have we don't know if we can get

44:21 water rights for the 30 and we don't know what those costs are either. So that you know if we stayed with the 30 that's also not baked into this. So, I appreciate the um the opportunity to be more conservative and go with the the 19. Thank you, >> John. >> Thank you. Um yeah, I think that uh the discussion we had last month was was uh a responsible discussion and I think that with the information that we had and and uh looking forward for what the what might be best for our community, the 30

45:07 million gallon was was an option that presented itself as something that long- term term would have would have been good. I think now that we've seen more of the actual financial impacts and some of the other information that we've gotten, um I also agree that I think 19.4 for is probably the the direction that we should go. And I think it it shows our rateayers and our community that we are looking out for the long-term stability of our community's water system and trying to do everything that we can. And last month we we thought that we could really reach for the stars and and do what was best for the community. upon further look, we realize

45:53 that okay, that isn't oba obtainable at us at this point. So, um I I wish we could I I really do wish we could build the 30 million gallon ones and try and pursue the the water rights and all of those things, but the way that it's presented to us, I don't think um we'll be able to at this point. So, I would move forward with building the budget on 19.4 million gallons. Um, as far as the uh financing strategy, I do have a question. Um, if we go with option one where we make in 19.75 for the next three years and do it with with traditional financing, we have a fairly steep drop off in after year five. Would that

46:39 allow us to um rebond some more? uh cuz what was presented was that there are other big projects down the road. We saw some of them, the the river crossings, but also the Hayden Bridge project is is going to be coming up. Um and so if we go with that first one, does that free up a little bit more of that bonding capacity because our rate impacts will be lower and we might have an opportunity to maybe go from 1% to 3% and be able to fund Hayden. So it reduces our overall leverage with a smaller plant and that does provide for future borrowing capacity as we find

47:24 needs that arrive. So yes, it would allow for future borrowing. >> Okay. Um and so these are 20-year bonds that we probably be going out for. >> Um we could consider uh 30 is what we typically do. We can consider as long as 40 as a way to spread costs out further. >> All right. Thank you. >> Thank you. Um on slide five, I believe it was uh it's the um slide with the total estimated cost. I just want to confirm just verbally that's uh uh one slide before um hold on. Where am I? you want the uh >> total estimated cost uh which is one

48:11 after the fund triangle one. Perfect. Great. Thank you. Uh I just want to confirm this is uh considering as much as we can of what is the expected costs um that this is uh not just the treatment plant construction but the total project itself. Right. >> Okay. Thank you. I just want to confirm that make sure that we have that understanding. Um I at our last board meeting I remember bringing up uh a conversation of or I remember bringing up off ramps of uh going with the 30 megawatt gallon and I didn't expect it to come one month later uh of what a potential off-ramp looks like but I agree with uh with uh commissioners Barski and Carlson. I think um you know we we're seeing uh

48:56 what it looks like to build a a project uh that is resilient, is looking to help support our community for future environmental impacts and and natural disasters and also being prudent with what we're spending today. Um, I think that we uh I I also see that last conversation as a positive thing and us moving in this direction as we're acknowledging the importance of the water treatment plant. We're putting our faith and support in staff and uh you know putting our full force into staff and I think that uh that's exactly what we're doing right now as well if we move forward with the 19.4 four is that we're still putting our faith in you um in

49:42 completing this project in considering all the options that are there. Um so I would support the 19.4 moving forward. I think it makes sense to me. It is upgradable in the or uh can be developed in the future uh just to add on once we get to that point of being able to uh continue uh moving towards a 30 megawatt. Um, yeah, I think we're we're all rowing in the same direction here. And, uh, that's that's how I see this conversation. So, thank you. Uh, and I'll comment on the other two questions on second round. >> That's fine, Vindy. >> Um, thank you. I really appreciate the staff's ability to quickly get us updated budget numbers because oftentimes it takes a while to do that. We wait many months. And I know this

50:29 item was slated to be on the agenda anyway, but it seems like it was very timely that you were able to get us kind of an updated picture. And I know that's not easy. So, thank you for the work that went into that. >> Um, I also um support going for the 19 um capacity plant for all the reasons that have already been said. Um, in terms of the financing strategy priorities, I support the one number one I think because that seems to me, tell me if I have this correct or not correct, but it's more of like the pay as you go kind of model instead of like pushing things out. And I feel like we have in the past made a lot of decisions

51:14 um because we don't want to burden customers with increasing rates and things like that. and then we kind of get in trouble, but we it ends up not being so great for us because then we have to play a lot of catchup later and um I don't want to do that with this project. Um so whichever the the best kind of pay as you go and um that that's what I support. So I will stop there for now. >> Okay. I support option one 19.4. Now my question Karen, you said if we don't harden the crossings in the river, we can still serve everybody with Wamut treatment. I live north of the river. I represent everybody north and east of

52:00 the river. We get our water from 40th and Patterson and College Hill. So if we don't harden those crossings, what why are we so vulnerable? Because if we have this catastrophe, everybody north of the river, how are they going to get their water? We're not going to harden those casings. >> We are We are not not hardening them. We are just pushing that out further. >> That's what I mean. You're putting You're putting 28,000 people at risk of not having water because we don't want to do either Nicker or the one on the ground and everything else. And I we represent geographic portions of the city and I got to go to bat for everybody in WS four and five and I'm going to bat for I to me that's not

52:45 acceptable because I don't think we should be put at a much greater risk than 80% of the rest of the community that everybody south Eugene and South they get they get their new treatment plant and they get water and they get resiliency and we don't. So how do we work through that? Um, >> I'm just planting that seed because it's going to come up again and and I I don't I I I think about equitability and everybody else and how do I tell the people in WS four and five that sorry our water lines are all broken because we didn't fix them because everything has to cross the river. >> Are you um are you referring to a sequencing issue because I mean my understanding we're we're still yeah >> going to get it done but it's just when we get it done. So um you know it if

53:32 it's it's not it will happen um the first piece of it. So you know your concerns about the hardening we will harden those systems. Um but we have them pushed out just to be able to manage some of the costs that we have budget-wise but it will get done. >> All right. And then um on your uh summary of water, your long-term financial plans, we have the 19 and a half 1975 rate increase for three years and we dropped down seven and everything. Is that just to finance this project or is that financing this project and operations? It >> it's everything >> correct? >> That's everything. >> That is everything. That's this project, any other capital work, and our ongoing operations and maintenance. Then why

54:18 after 5 years do we go to 1%. Because that's not even inflation. We're going backwards. >> Um it's because the large rate increases necessary >> surplus money >> because I mean if inflation's three 3% or 5% which we make into our assumptions and our rate increases are only 1%. How are we going to run this operation if we're if we're only raising rates 1% and inflation is 3%. How are we not going to get back in the same problem? Well, eventually that is true that not keeping up with inflation uh would uh but here what is happening is that based on the information that we have today and the need per our board policy to have two

55:05 times uh debt service coverage, we actually have the rate increase to support our financial metrics. That's what it's doing. It's not strictly funding operations. So there's a time period unless we find other things. So there's where your capacity is in the years after we do this work is in those years when uh when the rates to fund our debt service or to support our debt service are more than sufficient to cover our operations. >> Thank you. Second round. Sonia, nothing. John,

55:50 >> them first. >> Go to them first, Mindy. >> Yeah, I just have a couple questions. So, um, with the deferred work, we're deferring $36 million worth of work. Do we have an estimate of what that will end up actually costing us? Because everything costs more, right? Every every time we defer. So, I'm just curious. Just do we have an idea of how much more that will cost >> just based on inflation? >> So inflation in the inflation in the plan is looking at back row to see if they're going to flash me hand signals. Next year is five the assumption then it goes to four and then another four and

56:36 drops off to three. Thank you Alicia for that. And so that applied to whatever the costs today are to which I would look to engineering that that is the rate at which we would expect those costs to increase. So I guess I'm just going to I'm just going to trust that or I'm going to ask that these deferred projects you like it's worth it to defer them even though the cost will go up. um than to that into our capital plan now or not cap but do them now like it's that it's that makes that much of a difference.

57:22 >> So I think that that is a good consideration for staff and particularly to look in that time period right after um we've finished the second treatment plant. Kids take that as a as a go back Yeah. So I, you know, I will say a lot of it has to do with what we think the rate sensitivity will be for our customers. Um, you know, we've talked internally, for me, it was important that we try to stay under that 20% range. Um, if we do blend in additional projects, we're going to go over that. Uh so it's it's you know a combination of looking at what we think the affordability u the p perception of our

58:09 customers will be um having to go above that 20% range for a number of years versus um staying slightly under that deferring projects that we've looked at that we believe we can defer without any real um big impact detriment to the system. But we have to do them and we will do them. But nonetheless, if we can push them out um dampen the rate impact u that's what you know we were considering when we sat down and went through these things. But but I think yes there will be additional costs. You have those trade-offs um as you go further out um materials, labor, all those things cost a little bit more. >> Okay. And then one other question. Is the plan still that when we have the new treatment plant that we're going to be

58:55 mixing the water with the water that we take that that's all staying the same? >> Yes. >> Okay. That's it. Thank you. >> Thank you, President. Um I and hearing where my fellow commissioners are on the options that are uh uh presented. I do want to pitch. I support option two. And the reason that's top of mind for me are the uh is really the economic volatility that we're seeing at this moment uh especially from the federal government that's making its way down here to the state. Um it's beginning to stabilize in many different ways. But we're also I know the Oregon legislature right now is facing a huge crisis on the Medicare Medicaid that they're obligated

59:41 to pay that there's a huge funding gap. um that's also in line with some of the other economic issues that have come forward with grocery prices, affordability, and housing. Um and so right now with low-income families in mind, uh having that high ask now is something that I find concerning. Um, I think that uh us a a smoothing over time, uh, scaling up rather than scaling down, uh, has the ability to also help support families that are on those low-inccome programs like SNAP and LIE HEAP and others that are able to, uh, approach those, but also those who are on social security that don't get their um, uh, fixed income updated multiple

1:00:26 times in a year or uh, multiple times, you know. So, I want to put my support behind option two. I see the the pull the band-aid uh effort behind option one of just getting it out there and trying to drop off as quickly as possible. But um I think that and I recognize that both of these have big risks. Uh but um that's where I am thinking at the moment. >> Thank you, John. >> Thanks. Um just a quick question on the deferred three to fiveyear projects. Is that deferring them past this 10year CIP or are they still in this CIP?

1:01:11 So let's just take the John's River crossings that is on a deferred 3 to five years. Does that mean that we're what that what would have been in this 10-year plan? Now you're saying that that's going to be deferred till either 13 to 15 years from now or is it in the out years of the plan? >> In the out years of the plan. >> So it's still baked in the the So how do you get the savings then if it's in the if it's in the CIP >> by borrowing less over time >> because of the compounding factor. Is that how it works? piece of it is the compounding factor. And then in the back half of the plan, we do have more cash because we needed

1:01:57 to raise rates to cover uh the debt service for that peak uh debt service load that we had about midway through the plan. >> Okay. So, it's still in the plan. They'll be built with it probably start working on those in year five. And for me, it kind of makes sense that if we do the river crossings, you do it, you know, you bring the pipe up to it, then you go go across the river. But um to uh Tim's comment about one or three, I really think that um [clears throat] a combination is going to be used here. You know, that's just that's just the the nature of the beast. you know, when

1:02:42 you when you have to bond out for hundreds of millions of dollars, you might need some of it upfront and quick and easy, and that might be short terms and and those types of thing. I think it's more of a uh uh trust our financial staff to look at the best way to maximize our our debt portfolio um when it comes to construction. So, um I think the question that they're asking us is do we want to build in this is 19 is 19.75% palatable uh for three years. So that's $9 the first year, $10 more the second year, $13 more the third year, and then

1:03:27 it drops down to $7 the fourth year after that. So basically, we're talking $40 in four years increase to it. So that's almost doubling our water rates in four years. So that's that's the question that I look at and and am am I comfortable with that? No. Sometimes things aren't comfortable when we're sitting in these chairs and we have to balance our community's needs against, you know, two different things. you. I absolutely understand the affordability and the people that this is going to affect the most and yet I also know that there's 200,000

1:04:13 people that are going to need water in this community for the next hundred years. And so ba making that balance call is really tough. Um, I lean into, um, the idea that, yeah, you, you know, 19% sounds a lot. $9 doesn't quite sound as much, but to somebody who's only got $8, $9 is a lot. That's just where I'm landing. And I I still am probably with scenario one. but giving giving our finance staff the the most flexibility to look at it and realize the best way to to put our debt into the market. So,

1:05:04 >> going back to the the question of you know option one, two, three or four on option um on each of the options. [clears throat] Do the bars that are in that graph kind of roughly relate to the actual years or is that just a a diagram for demonstration? So that it actually does decrease um in that year four or the year what six on option one. So in the option [clears throat] in option one rates due in year six that's really the the model that was displayed on the slide and yes that is uh that is a an expectation that rates

1:05:50 drop off sharply in 2032. Okay. In so given that in the other ones the other options then that are not modeled um do we build at a different rate? I'm assuming that we borrow more in those earlier years. Um sometimes when we borrow we don't spend >> um immediately right because if there are any supply chain issues or other disruptions um we have staffing we run into a regulatory issue things like that do we run the risk of overbaring early and not matching the costs that we have and then having to kind of overburden our

1:06:37 customers in that model. So in in any of the models we would have our eye on how much we needed to borrow and in what time frame we and then we balance how many times uh we go out to borrow because you are pointing out something that we could experience which is borrowing more than we need for the next two years and then there's interest due on that. That's one of the places where we might look into or where we will look into uh the flexibility that could come from a line of credit that would then be converted to long-term financing. So that's one of

1:07:22 the strategies that we could use. Line of credit one year, the next year borrow with a long-term bond and then lean into a line of credit again. So we'll be looking closely at how the spending pattern is projected will be really important to uh to that funding but we are watching that the only one that slows down the construction would be option number four which is and the risk associated with that is is uh our permitting our water rights and then of course inflationary risk. But in any of those options, we would look to minimize cost to cost to our

1:08:09 rate payers. >> Okay. Okay. Thank you. I I mean I both option one and two were appealing for different reasons. Um, I mean obviously overall I'd like to cost our or have our community pay less overall which it seems like we can achieve potentially an option one especially if you implement some of these other um financing tools to make sure that we're not over borrowing in times of delay which these projects always have times of delay. I it maybe not. I I have seen we have seen the uh water um storage tanks come in under budget and on time which is a miracle in this day and age

1:08:54 and that's part of the reason why I think we were so gung-ho about trying to support getting this project done um with with current staff and the capabilities that we have. Um but option two is also appealing to me because of the kind of slower ramping up the um points that Commissioner Morris made about you know just the the impacts that our customers are currently facing. um that option two doesn't um do do we have any sense of how much of a higher cost option two has versus option one over the life of the project? So in some of our earlier

1:09:41 running through the model, we saw as much as maybe 15% in the overall compounded rate trajectory. And uh although I I hate to sign folks up for a lot of scenarios, I I think that it's reasonable that we listen to what you have to say here tonight and we maybe bring you back a couple of things to look at in October. The decision that we'll need in October is what are we doing in 2027 um specifically, but we we could share some financing strategies for further consideration [clears throat] at that point. And the other and the other way that we accomplish uh any of

1:10:27 the smoothing strategies is by deferring principle. Uh and that's pushing that out into the future. And I think I'm generally hearing not a not not so much interest in deferring payments out to the future, but seeing what we can do with the tools that we have today to minimize borrowing until we absolutely need it and reduce financing costs in as much as we can while generally keeping up with what we need to serve our debt >> and meet our water rights deadline. that match our water rights deadline. >> Yeah. And I think that's important. Um, you know, we'll we'll tether to those financial principles that we've got, but

1:11:13 the other thing that um through conversations over the past month, um, you know, the staff really honed in on the fact that, uh, we would jeopardize um, water rights, um, permitting and those types of things if we were to try to begin to slow down the, um, the build up front. uh because I did ask those questions I think you know just in a spirit of trying to figure out if we could smooth um those rates and you know borrow and build less and then ramp up to it. But when you um slow down just focus on intake for example um you run the risk of yeah you can build it maybe cheaper but then by the time you ramp up on the other stuff you may run into those um deadlines around water rights etc which is you know 2033 is looming

1:12:00 fairly quickly. All right. So from us you need option one two three or you can bring back another option but we do need to vote on the trajectory of the 19. >> So correct for tonight. I I just need to understand that I heard you all correctly about your priorities as we go back and work on funding strategies and uh not jeopardizing the timeline. uh trying to avoid pushing too many costs out in the future, balancing and looking for flexibility where we can obtain it at a at a reasonable financial cost. I I

1:12:45 Good luck. Yeah, I I know. Um so, we'll take that back and we'll come back with a couple of things for your consideration. The point at which we really would need to understand what what you were comfortable with would be in October for what's necessary for 2027. >> Um so um I I still in with number one, but I I will pull the board on seeing where we go to give you more direction. But I would just like to say we're talking about the financial impact here with no state or federal assistance. I we got a we got a legislature and leadership now

1:13:30 that is trying to spend $350 million put new seats in a basketball arena. And to me that's not a priority. And I would like to you know we talk about communities getting behind things. If our community got behind this to our elected officials and said we need help because this is a huge lift no matter if we go with option one or option two. This is the type of thing that I think community support needs to get behind. It's not a coincidence that our state senator just went through our water treatment plan. I'm good kudos to James and uh but we need help and we need to cut some of these costs down because for me I could care less what the seats in the motive center are like. I I could care less. I I I'm really concerned about whether or not we have a second water source and whether or not we protect this community. So hopefully

1:14:15 Jason, you're listening and we need to we need some heavy lifting with with our elected officials and community support to get behind this thing because this is going to affect every one of us no matter whether it's option one or option two. It's going to hurt. People are not not going to water lawns. The consumption's going to go down. MWMC's rates are going to go down because they're we're not going to be dumping all the water into their system. The whole thing's going to go down. and uh and we we have fixed rate commodity. As you know, it costs so much to pump up 10 million versus 20 million. It's going to cost us more. And so I I'm hoping that we can get behind our legislature and our elected officials to get us some help. And I don't care if it's 5 million or 50 million or, you know, whatever, but I think we need an effort to do that. So that's it. So with that, I'm done off my soap box. I' I'd like to

1:15:01 just pull the board. Um, is everybody, you know, do you do you as staff and and and John, do you have enough from us what you need to move forward or do you want more definitive on option one, option two? I think the 19.4 is a given, >> but yeah. So, I I think the 19.4 >> um it's you're going to pull regarding the financial strategies, the priorities, but >> I I thought it would be good to give you direction. You got four options and I think you've heard. >> Yeah, I think um you know the 19.4 assuming what the um number one option one >> and then I think as long as we're comfortable with the 19.75 on the rate trajectory. I think that's

1:15:46 >> that's what I'm going to pull. John wants to go ahead. Well, I I was just going to say before I could give you a definitive I mean I I can say probably for 2027 I I'm fine with not going over 19.75. I think I don't have no problem with not going over 20% for 2027. But you know all we saw was a bar graph there. We didn't see we didn't see the the how it looks right on on these other options. So for me to give you absolute direction saying yes I want number one over number two without it even modeled even a little bit I don't feel comfortable doing that. I do feel comfortable building no higher than 19.75y.

1:16:32 >> Yeah. Well, I don't want to speak for you, Deborah, but I think what I heard is that uh people either lean towards option one or two, and Deborah mentioned that perhaps she'll come back with another option taking those perspectives uh in account. That correct? >> That is correct. >> Thank you. >> Y thank you. Yeah, I I'll answer the question of uh option three is cool, but uh I think uh it's it there's much better trades off uh for the other options. And then I'm not interested in option four at all. I think one of the biggest issues we're trying to resolve our water rights and so option [clears throat] four puts that at risk. Um and I agree with Commissioner Barski. I'm sure 19.75 not to exceed that. I

1:17:18 think that sounds good. So, I'm I'm hoping to answer those questions for you as uh question one, question three, uh that you have a definitive answer and then um to uh come back with uh what option one and option two looks like um in terms of the actual rate impact. Um I think that's where just the point of contention is right now [clears throat] with the >> Okay. So, I think a consensus is that three and four are dead and one and two are coming back with more definitive numbers and 19.4 or is it for for the capacity at this time? That it >> that's it. No, really appreciate it. >> Thank you very much. I appreciate it. >> All right. Thank you. >> Next agenda item is going to be the alternative uh use of the CMGC contract

1:18:04 and we're going to get an overview from Karen and Laura. >> Good evening, commissioners. Again, I'm Karen Kelly, chief water operations officer, and with me is Laura Farthing, our principal engineer, and also our project manager for the Wamut treatment plant. Uh, we are going to just do a very quick overview of what the CMGC is all about. It is an alternative project delivery method where a contractor provides advisory services during design and can later transition into the general contractor once the design is complete and a guaranteed maximum price is agreed upon. It is widely used for complex infrastructure and public works

1:18:49 projects to reduce costs and mitigate risks. We have found this method to be effective in managing large construction projects with unique scheduling scopes and regulatory constraints as has been done with our Carmen Smith project. The contract will be procured [clears throat] through a competitive request for proposals process taking into account the firm's qualifications, project approach, experience, price, and references for similar work. Some of the key benefits you can see here, early budget certainty. The contractor and owner negotiate a guaranteed maximum price before full-scale construction begins at a 90% design phase and prevents cost overruns. Early collaboration is another. The builder, designer, owner's agent, and project owner work together during the design

1:19:35 phase. This allows for constructibility reviews, catching potential problems early. We also have reduced project times by utilizing early work packages. Construction can begin while the rest of the design is being finalized. And risk mitigation. The risks are identified, evaluated, and planned for collaboratively during the design phase. Reducing change order potential during construction. And last but not least, uh it does result in fostering innovation. Contractors can suggest better construction methods or material alternatives during the design phase which can save time and reduce cost. So we did want to show you this slide again which we did last month but there are several checkpoints here in which the board can have some oversight on the

1:20:20 CMGC process. Uh so this is much like a design bid build but I do want to call this out. The first decision is what we're asking for tonight. authorization to procure the CMGC and an owner's agent. We will then bring that contract to you early next year for review and approval. In this model, the board will receive updates on costs at key 60% and 90% design milestones. The board will then be asked to approve the guaranteed maximum price for the treatment plant in late 27 or early 28 before any construction begins. With that, uh, we can entertain questions. Laura is here to answer all the technical ones and um or move to a hearing. >> You got any questions before I open the

1:21:05 public hearing? >> You can open the public hearing and then get >> questions. Okay. I'm going to open the public hearing. Is anybody signed up to speak? >> Well, then I'm going to close the public hearing >> comments. Um now the next agenda item is going to be action item. uh whether or not we move forward to Sonia >> um with the alternative procurement process how I mean generally speaking with bidding process the idea is that you have competition and that because they know there are other you know biders out there that they're going to be competing against they'll give us a good rate. How do we ensure that we're getting a good rate in this process? there will still be competitive bids.

1:21:50 So, we will go with a method that will um require the contractor to have basically an open book and show what the bids are and what the prices came in as. That if that answers your question. So, it does still have some competition involved in it. >> Okay. Thank you. >> Any other questions, Mindy? Yeah, with that competitive bidding, do we we're fairly certain that multiple companies will bid on it >> for well, so for the CMGC itself, we are confident that multiple companies will bid on having that contract and then the way that part of this is how we're going to break it up and then how those will come out. But yes, we are confident. This is a big project. There is a lot of

1:22:36 interest in it. Um, one of our main goals is to make sure that we and continue to make opportunities available for local contractors that we've used. And so that's one of our main sort of things. So the whole we haven't written the contract yet. We're still going through that process. But, you know, how we there's ways that we can write it so that you know we specify how much can be self-performed by the CMGC and how much has to be bid competitively. So, we're still working through that, but yes, we are confident there will be much interest in this. >> Great. Thank you, >> Jim. >> Are you sure? Uh there's an open book process. Can you expound on that? >> I can for what I know. So, um, it's basically the way that we'll write the

1:23:21 contract and it's part of the guaranteed maximum price is that we have the rights to see what is happening behind the scenes. Unlike a lump sum bid, which would be another option you could do for this. So, when you do a low bid, you just sort of get the number and that's what you've got. This gives us flexibility to look into what is happening behind the scenes and behind that guaranteed maximum price. >> So, in a way almost more transparent than normal process. Yes. Great. Thank you. And more collaborative. We're more of a part of how those bids come together rather than it just happening with a group of contractors all going for the lowest price possible. This gives us a better value and um offers us more control and more transparency. >> Thank you. >> You have any questions?

1:24:07 >> Go ahead, John. >> Um so a couple questions. First off, last time last month when this was presented, there was talk of breaking the contract up into different parts. Um, and and I know that a a project of this size has very a bunch of complexities that are different than than what we've dealt with in the past. You know, we've got inwater work. inwater work is a lot different than just pouring concrete on a on a basalt mountain. Um so what at this what parts of this are we actually committing to CMGC?

1:24:53 Uh have you thought have you talked about which parts are going to be broken out? After looking at it, we had originally um thought about breaking out the transmission main, but I think it keeps the project cleaner to keep it all in. So, for the CMGC process, which gets us to the guaranteed maximum price, we're going to keep it all as one package. That just makes it easier administratively. It allows us to admin um manage less contracts. There's, you know, time and cost associated with each contract and how we manage it. And then it doesn't it still allows us flexibility if we want to um once we get to certain stages of it we can still pull those work items out. This also allows us to have the contractor better time and sequence things. The intake is

1:25:39 a good example. Uh we could do the intake inwater work but once you start building the pump station you get some issues around when you put in say mechanical equipment. You don't want your pumps to sit there for three years because we wanted to do some early work while the treatment plant's being built and your warranty runs out. So, this just gives us a better way to sequence it. >> And and I'll lean into you people on this. Absolutely. But I I guess the question that I would have is I'll just put a scenario out there. We give CMGC to somebody bids it out there, right? And then then they go out and rebid the different parts of that, right? And so they may bid somebody that may if we

1:26:24 were to if we were to do a competitive bid on the intake, they may have picked somebody that we thought wasn't as good. Do we have an opportunity to say, "Hey, wait a second. This what for whatever reason that they're not as local. they're they don't have the expertise. We're saying you've got the whole contract and we're going to look at your expertise, but then they're look then they go out and say, "Well, no, I think this guy's got enough expert expertise to do this." How do we do that checks and balance if it's if they are the ones managing the contract? >> This does allow us the ability to get to the best value. So, we have more input into how those bids occur. uh unlike a

1:27:09 design bid build, you know, they would have say a um sub that would do that and we would ask for minimum quals and they may pick somebody that meets the minimum quals that we don't think will be as good but we have zero say in it at that point in time. This gives us the ability to work with the CMGC and to collaborate on what's important for us and then how we work through that process. Okay, next question is when we put the RFP out, does this board have any input as to go looking at the RFP as to what values that we hope to achieve when we're putting a half a billion dollars into our economy and saying yes, we would love to have that, but but leaning into

1:27:56 local contractors when when they are is appropriate. I I don't want to just say you get it because you're across I5 from us. I want the best possible people. But if there's if there's an opportunity for somebody that's here and somebody that's low I mean do we have the ability to weigh in on to our values that we would like to see on this half a billion dollar contract. And the second thing is are these all going to be prevailing? Are these all going to be prevailed? It will all be prevailing wage. Uh size of the project dictates that. Uh we are involving you know the general manager and the assistant general manager in the RFP process and in review. So we could definitely get your input through that

1:28:42 to make sure that it's captured in the RFP basically. I think there's ways that we can do that. >> Okay. and we should I mean it is a very large project so we want to make sure that what we find valuable is included >> and and that's what I would hope I would hope that that's something that that the people who are putting the RFP forward lean into us as as the community's voice into this board when we when we're when we're talking about a $20,000 contract to to pave Burlesson that's one thing when we're talking half a billion dollar project that affects this community for the next hundred years. I I will definitely want to have at least some form of of a touch point.

1:29:28 >> Um I have a question about your owner's rep. Um so that's basically going to be our our advocate to keep costs down and they're going to take issue with the contractor and say we're not going to have a change order and we're not going to do this. So things like So this is going to be a city of Springfield billing permit, correct? Okay. and things like SDCPs. I can't imagine we would get a penny in SDCPs because we're not putting any demand on the systems. We're not putting demand on water, on sewer, on anything. And so when we have that conversation, is that something that the that our owners rep is going to push back on? Because my experience dealing with municipalities and SDCPs, they're going to just absolutely tell you when to put your hands down unless you push back. And and I'm concerned that we're, you know, we're going to

1:30:13 have those conversations. Karen, you're smiling. >> That is a a totally separate conversation. But there there is um ability for us to to include this project in our SDC project list, but we would have to revisit what our policy is on SDC's. >> When I'm I'm talking about the city charging us SDC fees, >> not not using ours. not using ours, but because we're in a different municipality in the state, city of Springfield saying we owe them $3 million for SDC fees. >> We actually have just just recently uh my supervisor and I just discussed this and so we have plans to sit down with the city of Springfield and talk about

1:30:58 what the permitting fees are going to be and how they're going to assign those. And then you know there will be discussions that are had after that whether it's the owner's rep that does that or if it's uh the internal project team. I find that sometimes working with other municipalities it's a it's better to bring in you know the local people that work with them all the time because we already have those relationships. Um, and then yes, the owner's rep will be a separate contract and it'll be our advocate that we hire and they'll help us through not only the constructibility and the construction management piece, but they'll also help us with design reviews and um the technical components of the project. >> Thank you. Anything else for for a motion?

1:31:43 >> An action item. I move to approve the use of a construction manager general contractor for the Wamit treatment plant. >> Is there a second? >> Discussion. No discussion. All those in favor signify by saying I. I. >> Passes unanimously. Thank you very much. Now we're um 40 minutes ahead of schedule. And uh we next agenda item is 15 minutes. We can either take that as just a report from um Sonia and I and John about our our meeting with the city or we can go to break. What's the preference of the group? You want to do the 15-minute one and get it out and then go break. Okay, we'll do that. Okay, Sony, you want to take it? John, >> our meeting our recent meeting with the city.

1:32:30 >> Okay, you go. >> Yeah. So, um, you know, as President Brown said, we recently met with the city officials, the mayor, deputy, um, um, or the city manager and deputy city manager, and I think, u, I want to say the mayor's chief of staff. Uh, the meeting was very productive. I think for me it was an opportunity to begin to establish relationships with the broader team. Uh, one of the things that I'd mentioned to them is the idea that um, at some point um, in the near future, we'll be embarking on our strategic plan. So, um I would certainly want to engage them and see where there's opportunities for them to understand what we're doing strategically for us to also engage with them. Um from what I could see in my um preliminary discussions with the mayor, um the city

1:33:16 manager and the deputy city manager, there's a lot of um consistencies what we're trying to do um strategic at least. I didn't see any um you know um anything that was mutually exclusive. So I think um you know for me it was an opportunity to just begin to lay the groundwork for further engagement. I know a couple other topics came up uh but you know for the most part I thought it was productive >> talked a little bit about um fire hydrants and then I quite a bit more about the WAMIT treatment plant and some of the impacts that we would see on rates and um I think we also slightly um conjectured what would happen with the climate recovery fee and how that would work but you know that's all um

1:34:02 conjecture at this point So mostly we talked about the strategic plan, the Wamut treatment plant and rate impacts and um how we were trying to mitigate the impacts to customers and how we would communicate with uh the city around that work as well. >> I did bring up the fact that we've identified if we take over fire hydrants, there's may be as much as $2 million in deferred maintenance. are are they going to hand us that bill or are they going to hand us a system that's up I mean is because that's $2 million out of the water budget and and is that going to be on us and that's a decision that you know we all have to deal with or address because if they hand us over maintenance of the water you know because I think community would not like to know that the fire hydrants aren't

1:34:48 being maintained and they're in such terrible condition but do we do we do we as a as a utility absorb that $2 million cost or I mean how do we get a credit for silt and they could pay us back gradually to to fix the system or what? So I we we planted that seed and it's in there and I kind of they didn't really kind of give us a definitive answer. I think where they kind of said why did you ask this but you know me. Um so anyhow we we did that but because I think you know couple million bucks in the water is a couple million bucks. So um that that's it. So that's and I think everybody else has summarized everything else. So, if that uh nothing else, I think I'll uh call a break at 7:05. We'll we'll re engage at 7:15.

1:45:28 I'm going to reconvene the um uh e webb meeting of August 4th and the next agenda item is the quarterly strategic and operational report Q2. General manager Haristen. >> All right, good afternoon or good evening. For the record, John Haristen, um, EW Webb CEO GM. I'm here to present the quarterly operating update for 2026 Q2. Uh, so, um, just in general, this is my first, um, quarterly report to the board since joining E Web in May. Um over these few [clears throat] a few past months uh my priority has been really to get out and meet with the uh in a workforce uh meet with stakeholders. Um as you probably saw from the GM items the the list that I

1:46:15 had it was pretty u long in terms of the visits I've been making. But you know one of the things that I've taken pride in and continue to move towards is meeting every single um e webb employee shaking hands with them. So made some substantial progress with that in the early months and going to continue to move towards that. Um I've also um I think of note been able to introduce weekly alignment meetings across the organization. Um I've also instituted a weekly message to make sure that we're keeping our workforce u connected to leadership and and and connected to the things that we're doing organizationally. Um, as I look ahead, I'm going to continue to be con, you know, committed to being transparent, um, particularly with the decision- making that we're making, um, staying

1:47:01 consistent with the e-web core values of safety, reliability, affordability, environmental stewardship, um, as well as community. And, um, as we move forward, we'll continue to sharpen our approach to cost management. Um, and I'm hoping that um you're beginning to see that um even with the prior discussion that we had regarding the water treatment plan and the um long-term financial plan. Uh so turning our attention to the financial side of things for Q2, as you can see with this slide, u we've got a number of um strategic focuses that we've undertaken at the utility. Um but of note both the electric and water utilities entered the second half of the year in stable financial condition with the year-to-ate performance tracking on target against

1:47:48 budget. Uh the electric utilities revenues are tracking slightly below budget largely reflecting moderate uh weather earlier in the year and softer wholesale market pricing. Now that same uh pricing environment however has kept uh purchase costs um you know um our largest basically our largest operating expense um favorable to budget. Now nonoperating revenue have benefited from the McKenzie Valley territory sale and the water utilities operating revenue is slightly favorable to date uh with the strongest consumption still ahead in the uh third quarter. Now, operating expenses are currently running above budget due to timing of capital project

1:48:33 activity, which is expected to normalize um as the construction seizes um progresses through summer and into fall. Um both utilities completed bond financing in June u strengthening cash positions to fund capital investments while increasing long-term liabilities. And the debt metrics um are expected to trend back towards policy targets as capital projects are placed into service and scheduled debt payments are made. Now, in terms of um some major milestones we'd like to to share, I'm pleased to report um I think you're aware, but you know, the completion of the multi-year effort in transferring the Mckenzie uh Valley Electric distribution territory to Lane Electric

1:49:21 Co-op, um including customer accounts, assets, um and data. Now, while this really effectively took place May 1st, uh this transfer is now substantially complete with remaining operational work on target and final regulatory approval pending before the Oregon PUC. Um concerning the second source effort, uh permitting and land use approvals are largely in place for um the second plant on the Wamtt River. Um this is a major multi-deade investment. Um and as discussed um I'm committed to ensuring that the um financial planning and rate impacts of this project are transparent um to the board and our customers as we design and fund strategy um development.

1:50:08 Now I also want to note that our Karman Smith hydroelectric rellicensing costs have grown substantially since the project's original scope. Um, current cost projections are now around $300 million, up from the initial 139 million budget. Now, this reflects expanded regulatory requirements, site conditions, and inflation. And I want our board and community to understand that these cost pressures um clear clearly as we um continue this work. Now, this year, our conservation programs have um helped customers save over 4,500 megawws uh megawatt hours of energy with meaningful participation u from limited income

1:50:54 households who represent 44% of our incentive dollars. Now, we're tracking below target at midyear, which is typical, and intend to finish 2026 um as we've planned. Now, on the assistance side, EW Webb customer care delivered over 900,000 in build bill assistance in the first half of the year, and our program has run um without interruption since early May. Um even as our federal funding um has faced some gaps. [snorts] All right. So, looking at our core work and operations, u reliability remains strong across both systems this quarter. Um, electric outage frequency stayed below um, our 5-year average and outage

1:51:41 duration was within normal range. Uh, water outage durations u remained below the industry benchmark um, even as crews responded to a handful of unplanned main uh, breaks and repairs. Now, I want to also highlight um that our water system earned a outstanding performance recognition from the Oregon Health Authority this quarter. um reducing our regulatory inspection frequency from every three years to every five. Um I've kind of um tried to tease a little bit our um our water team. I've asked Mike Masters, is this kind of the equivalent of the um Oscars for water? U he he didn't comment on it, but I I'll I'll stick with that. All right. Um let me see.

1:52:29 So, also want to note that our crews responded to an unplanned um incident in May uh when a truck accident released milk and diesel fuel near um Trail Bridge Reservoir. Uh thanks to the fast action of our teams and coordinated response um we didn't see any fish kills um or they were not observed and there weren't any um real major impacts to the river. Most of those impacts were minimal. Um also want to note that um our mass deployment of AI AMI meters on the water side was completed in June. We have achieved 96% of deployment for water. Um the Bartlesen annex um has open for use right out there. Um I was

1:53:14 able to go out and and tour that with some of our staff and and see it beginning to um you see us begin to utilize it for um excess inventory. Uh and then on the customer side, uh customer service average um speed of answer uh for Q2 was 79 seconds. Um lower than the less than 90 second target with a year-to date of around 99 seconds. Um call volume was 23% lower in the first half um compared to 2025 um reflecting continued u customer adoption of digital and self u service channels.

1:54:02 All right. So, to our strategic goals um and and progress being made there. U nine of 12 goals are on track as of the end of Q2. Um of the three that are not on track, the primary driver has been um a lot of the um resources being um focused early on on the Mckenzie Valley transfer. Um now that we've got that completed u we'll refocus those resources on supporting these goals. However, we do have three um that aren't on track at this time. Um those three are the limited income energy efficiency program enhancement um the scalable data warehouse goal. Goal number four and goal number seven um the preparation of the BPA contract implementation. I would say with goal number seven, we expect that to u catch up and be on on on

1:54:48 target u by the end of the year. Um just in terms of um other um items of note, u we do have targets that are either completed or ahead of um pace. U goal number one, maturing eb's business management systems is um ahead of pace. Um that really includes us beginning to initiate or central part of that's us beginning to initiate work on our strategic plan which um I begin to work with our strategy team um to lay out the steps and the goal is to have a strategic plan ready to go by the beginning of 2028. So more to come there as we have that discussion in September. Um the other is the second source um board decision package. Uh we've been making good progress as you've heard on

1:55:34 the land use approvals by Lane in Springfield. Um and receiving board guidance has allowed us to continue to make I think ahead of schedule progress on that. And then the last one as I mentioned the Mackenzie Valley transfer territory transfer has been completed. So with that um you know looking ahead um you know as I settle into uh kind of this role I'm looking forward to being able to build I think what is will be a strong foundation organizationally um being able to work with our employees to make sure that we're um maintaining the strategic focus that we should for this organization and meeting our customer needs. So, I am um

1:56:19 ready for any questions that you might have. >> Hey, I'll open the queue. Questions. >> Sonia, you always have a question. Good for you. >> You probably don't know the answer to this. I'm sorry that I didn't provide it um earlier, but I noticed in one of the um one of the topics it was talking about our uh energy efficiency modeling and the fact that we you know how how much we had hit and it noted that LED lighting was a big one of the projects. And I I'm bringing that up because I'd love to hear I thought that we ended the um subsidies for LED lighting. And so I was curious why we were um why we're

1:57:05 noting that as one of our savings if that's not something that we're supporting or maybe we are supporting it but in a way that I don't understand. So if somebody could just follow up with me after this um I'd love to understand that a little bit more. >> Okay. We'll make sure that happens. >> Otherwise um great work. Uh I I can completely understand why there are certain areas. I would like to note that the fact that I barely heard I didn't really see anything in the news. It was not a big uproar. The fact that the Mckenzie River territory just seamlessly transitioned without any fanfare uh was no less a miracle to me. So if any of these are slightly behind, it's because those people did a lot of work to make that very smooth. So thank you for that

1:57:51 effort. It's brilliant as far as I'm concerned. Other questions or comments, John? >> Yeah, thank you. Um, [snorts] and it's always interesting, you know, I go through and I look at the little I I look at them as gas gauges because I don't have an electric vehicle, so when I see those gauges out there, it reminds me of a gas gauge. But um one of the ones that kind of stuck out to me and it and it's really stuck out because there's smoke in the air and stuff like that and it had to do with our vegetation program that we were a little bit behind schedule and it it seemed a little bit

1:58:40 out of place to me for a couple of reasons. one I I recall last fall we we changed and and changed our tree trimming service to a different service. Brought them on board and they added a truck and then the majority of our obligation was up river. And so to see that that part go away and a new crew coming in that we fell behind. I I don't know if it's just a timing issue because I mean the amount of work that we're going to be have that we have to do is significantly less than what we would be doing before and yet it is increasingly important when we look at you know what's out there as far as smoke and our our liability with with our our vegetation

1:59:26 management. So, I just it it just kind of seemed strange to me those three or four things inter interacting and and that we were below below par on our vegetation management. >> Yeah. No, actually that caught my attention and that's something that we'll follow up on because I know we have um my understanding is that we had met um our veg management targets um you know to date. So, I wanted to make sure that that was correct, but um we can circle back with the actual verification on that. >> And [clears throat] again, it probably was a timing thing, you know, that we were looking at the quarter that was right during the transfer or something. So, we had still had all of the >> the uh requirements of up river. Anyhow, I just that's the one that stood out to

2:00:12 me. Thank you. >> Anything else? I I like to back up on that too, John, about the tree tree trimming because the way I read it, it looked like in 2025, we're two and a half miles behind and then but when we g gave up the up river, we had three crews up there and we laid one off and we transferred two down here and now we have 10. So I I'm thinking and so but now I think the way I read it, we're caught up in in tree trimming in in the two and a half mile. We have a five mile window and a two and a half mile window. we're caught up. But I would just like to emphasize, thank you if that's true and the way I read it, but also more importantly that I think it's really really important given what we're seeing outside right now in the South Hills and

2:00:57 Eugene. I mean, I you know, uh we got to stay on that and not ever let it get behind again if we can. >> Yeah. No, that's a central central component of our wildfire prevention program. So, um, certainly it is top of mind, but I I'm pretty sure we're in good shape there in terms of the target. So, I I just need to follow up on that. >> Well, then we're going to move right along. >> Well, actually, I got the thumbs up from Tyler, so yeah, we're good. >> Yeah, I guess I can explain that it was supposed to be a success story that we beat all the backlogs at this point is kind of the punch line. >> Yeah. Yeah. So, thank you. Real time. Okay. Well, the next agenda item is you're going to stay up there, John.

2:01:42 It's we're going to Dedrew is going to join you. Process and evaluation criteria for the general leathers 2026 performance review. Uh good evening commissioners. So the purpose of our uh conversation today is to seek board guidance on the 2026 performance evaluation process and

2:02:27 evaluation criteria for the general manager. Right. You may recall this. Um I think we last uh covered this back in the March time frame. Um in the March time frame, we confirmed the process, timelines, and goals that will be used for evaluating the GM's process in 2026. Um subsequent to that, um general manager Haristen joined us, had his own ideas of what, uh how we could refine and improve that process. Um you'll notice that the time frames remain the same. Um but as I mentioned, we are uh we are coming back to you today um to um uh [clears throat] incorporate some new formal leadership executive um competencies to round out

2:03:14 the 2026 framework. All right. So what are we talking about? Um, as part of this month's meeting materials, um, you all did receive background information, um, that contained the detailed leadership competencies, um, the five that are represented on the left side of the screen. Um, and a refreshed uh, direct report survey for review. Um, the competencies, there's five of them. um they are really focused on establishing clear objective behavioral benchmarks um grounded in the GM's position description and in what uh we believe uh e webb and the board should be looking for in executive leadership. Um we

2:04:02 additionally anticipate rolling out similar leadership competencies for the full executive team. Um so all ET team members and um general manager manager Harrison will be looking to comply to these competencies. Um we also modernized the staff survey. It had been out for a little while and these things you have to refresh every once in a while. They get dated. Um so we realigned them. If you look in there you'll see two or three very targeted questions tied to each competency. Um we um slightly refined the uh rating scale taking a 0 to5 allowing a little more nuance in the results there. Um and added three um very targeted qualitative questions around um specific action

2:04:49 specific behaviors that um could improve e webb performance. Uh moves the survey away really from broad feedback to specific observable leadership behaviors. John, is there anything that you wanted to add? >> Uh, yeah. So, um, you know, the the idea behind the leadership competencies is that, you know, there's a, um, a core set of, you know, resultsdriven type targets that, you know, we should lay out and say, okay, these are the things that we need to drive the utility towards and achieve um, during that year. But these other competencies really like business acumen I think focuses on things like the discussion we

2:05:34 just had regarding the water treatment plant making big decisions for the utility making them sound and on um sound financial um basis. Um the other piece is you know building internal coalitions. So, you know, I've always said the only way I'm successful by myself after day one, um, you know, is depending on everyone else. Otherwise, you know, it's it's going to be a royal failure. So, um, having to build those internal um, coalitions, the trust, being able to get work done throughout the organization is something that I think the board should expect me to do and to really thrive at. um building external coalitions, um being a big part of the community. I need to be out there um meeting with folks, making sure that

2:06:20 we're building partnerships, um allowing the utility to be successful within the community, u being a a solid partner, and then um leading the organization u whether it's um leading people um building relationships with the workforce, creating a work environment that's conducive for us to do our best work, or really um leading change. So as we do things strategically um different um I need to be you know really capable in demonstrating the fact that I'm leading this organization in the right direction in bringing folks along with the things that I'm thinking are important for us to be successful. So, you know, those competencies, I think, you know, there's a number of things throughout the year and engagements that will feed into demonstrating those. And then we've got the element there for

2:07:06 driving results, the key targets that you think we need to hit um and that I need to lead us in hitting um during the year. And as Dedra said, this is going to be important um you know, for us organizationally. These are the expectations I have for my executive team and the executives as they function. um within this environment and you know um I think it's also important to know what's expected of you and you know currently uh we don't have a formal review process put in place or performance agreements with our executives and and that's something that we're going to have in place fairly soon.

2:07:53 seeking sorry staff is seeking concurrence from the board that the proposed leadership competencies and the refresh survey should be adopted for use within the 2026 evaluation cycle. Um deval defining the evaluation criteria for the GM is rest entirely within the board's discretion as part of board policy BL5 um and allows the board to provide guidance or request adjustments without requiring a rigid formal motion. Um if upon consensus, should we receive it, um we'll work forward to finalize these instruments for administration in early uh 2027 um to deliver to you um in the March time frame. >> Okay, I'll open up for questions or

2:08:39 comments. Mindy, >> well, I I [clears throat] won't be here for this year's performance review, but um having sat on seven, eight others, um I think [clears throat] this looks great. I think that whatever um kind of hard data that you can give us to help um facilitate this performance review is fantastic because we interact with the general manager but we don't know how the general manager really like interacts with all the other employees executive team all of that. So this looks really great to me because um there are some uh very targeted questions. I like the rating scale. I also think that it is um great that it

2:09:24 will be used amongst the whole leadership team so that it's kind of institutionalized and everybody's working kind of from the same um assumptions for what the the criteria is. So looks great to me. >> Any comments? >> Good. Sonia >> just had a couple of just minor thoughts. So the questionnaire that is there so all of the leadership team would be given this or would others within the organization be given the um the questions? >> Historically it's everyone that would report to general manager Haristston. So think of the executive team and his his

2:10:09 office um you know uh Jason Jason an etc. Um and uh as well as uh um any other individuals that general manager Harrison designates. Um for example, last year it was managers and supervisors were also included. So that would be sort of the the range of folks I would be looking at. >> Okay. So they would um they would all fill out this form and then it would be >> aggregated >> aggregated together and then we would get this information as another tool to use as we're evaluating and then we have our own >> question do we go through and answer this question as well or is it I mean the questions are not

2:10:54 >> really geared to us. >> Uh these questions are not geared to you. Um there was a separate survey very high level that the the uh uh board of commissioners answered in the prior year. Um I anticipate we'd use that again. >> Oh, we would use that again. Okay, got it. And so the um these are all gear I mean they all literally say John in them but I'm assuming those are all geared for each staff member and um so so the leadership team has have they provided any feedback on this process as well? So for clarific clarity's purpose um we um what I'm talking about today is for the general manager. Okay. We have not discussed rolling this out this the survey approach out lower down in the

2:11:39 organization. >> No that's fine. I just meant did they have any feedback on the kinds of questions that were in here to evaluate the general manager. Um, we did not seek full staff feedback on this. >> I would just be curious because there might be other, you know, questions or things that they think back in the time of, you know, obviously very limited time with you so far, but you know, just in in general in their experience like what do I wish I had been asked and and is it would it be covered in this process? I appreciate that we're going to have this process and get that feedback. We've tried several different things over the time that um I've been a commissioner. So, I'm more than happy to to to try this out. I just also wonder if you know if we're really um covering

2:12:26 all the bases and I'd love to hear if there's some additional, you know, things that that maybe staff see that we don't because we're not in it dayto-day. >> I appreciate that insight. >> Um oh, and then uh one last little note, this is minor, but it says, "How many years have you worked with a general manager?" I just wonder if that outs some people who have been, you know, with the organization if we're really trying for anonymity. That might be a a factor that can change that anonymity. So, I don't know that it's really that necessary. I mean, maybe it is, maybe it's not. I don't know how you all feel, but I don't feel particularly strongly about that other than I think it might reduce some of the anonymity. Thanks.

2:13:12 >> Thank you. Um, one of the things that stuck out to me when I was going through and looking at the general manager performance evaluations for me was I I I could see it woven in, but I didn't see it called out. The general manager's relationships with the board, interactions with the board, how is he interacting with the board? Is there good communications with the board? Those types of things. You can kind of read into it in some of these, you know, building internal coalitions and stuff. But for me, if I'm evaluating the one employee that I have that I have uh purview over, his or hers or theirs um interaction

2:14:03 at the board level is something that that I need. That's that's the main thing that I'm evaluating, right? And and I don't see it in here called out. >> So that's something direct reports. >> No, this is his >> this is for him, >> right? >> You mean how we feel he interacts with the board? >> Just just I mean you're putting things in here that leadership behavioral competencies, right? To me, the way that he interacts with the board is something, you know, if if I've got a general manager that's detached from us and is is not doing one-on- ones and is not communicating, that's something that I would want as as part one of my benchmarks for evaluating him.

2:14:49 >> So, I guess my question, sorry, I'm jumping in here. Are you talking about what >> what the other people who are filling this out, you're talking about for us? for us this >> I think that's part of the survey that Sonia was saying the board will get our own survey >> we we don't fill this out we will get our own survey that talks about that >> I guess what I'm saying is that if you go back go back a couple slides okay and this is this is what we're looking at when we're evaluating the general manager okay is he hitting business acuments yes is he hitting building internal coalation for part somewhere in one of those bullets is I would like to have interaction.

2:15:36 Does he interact well with the board? Right? How is his interaction with the board? And can I factor that into his evaluations and and is he tracking that as something that he is trying to make sure he's hitting the benchmarks of? Do you and do you see that that might be lacking in those? It's an export point. It's kind of built between if you look at internal and external, it's in there, but you're you're correct. It is not um specifically called out. And that's a a wonderful point. >> And again, and that was just something I never saw the word relationships in any of the in any of the evaluation criteria. Y >> and to me if I that's that's what that's

2:16:23 the one that I have the most that's the one that I have the most information on how well did he interact with the board that's the one that I have the most the other ones are the ones that I'm going to be gleaming from these other reports but if if he's not looking in his goals of this is what I'm going to be evaluated on and it's not even listed in there on how he interacts with the board that's that to me that's problematic. So, that's just one of the things that I saw and took away from it. >> I appreciate that. >> Hey, Sunny, you wanted to comment? >> I just wanted to note that I think it would be helpful to see the actual survey that you're picking um that that we've filled out in the past. that would be what we're evaluating just to bring it top of mind again and look at it with

2:17:08 the lens of how does that play into these new um you know criteria because if it's it it I didn't see it spelled out in here so I think that would be useful. Thank you. >> Okay. And I'll wrap it up. I'm good with what we have but I I'd also like to comment just about this little interaction we had across talking and everything. That's exactly what we're trying to get more of and thank you for doing that. I I I don't it's not disruptive. It's it's very productive, I think, to for for for allow us to cross communicate with each other rather than just us to you. And so, thank you. And hopefully we can do more of that. So, I'm good with what what we have what you presented. And unless anybody else has anything else, we're done with this agenda item and we're going to go to future board agendas. We you got what

2:17:54 you have need from us? I I'm assuming direction is to make a few small tweaks that were suggested here and then go ahead and move forward with implementing and then share um reshare the commissioner survey for review. >> Sounds good. >> Thank you. >> Ready to go. Yeah, you're good. >> All right. So, future board agendas. I think there's nothing really remarkable in terms of changes to the um um future agendas at this time. I think um just a reminder that we're going to be covering the legislative update as well as the annual strategic plan review in

2:18:40 September. Um the only question I have for the board is um would um do you think you need or we would need a um a planning session or working session in August and September? Looking at the calendar, there are current um conflicts for the board in August and then there's a a conflict for myself in September. So, just wanted to see if there was a desire to um maintain the working session for those two months on the calendar. >> I I think the only thing I would say on that is in the past when we did midmon

2:19:25 work sessions, it was for a specific project that that needed a deeper dive. And if there's not if there's not one that's been identified, I'm fine with with not going with them. I am too. Tim, you good? >> Yeah. >> Sonia, we're good. All right. >> It's very good. Thank you. All right, the uh next agenda item is going to be the board wrap-up. I'll start around with Mindy. Anything for the good of the order. Tim, Sonia, John. >> Yeah, I do have one thing and it's probably not I'm probably in the wrong spot for it, but I keep forgetting to bring it up. In the past in our emails there was an opportunity the GIS outage

2:20:11 is a line on our on our emails and we haven't been getting those for months and months you know so when when the uh when the lights go out across the street or in my in my ward somebody calls up and says hey what's going on in the past I could go to the GIS outage part on my phone and it would say this this many things and I would now I have kind of go into the public portal and stuff like that. So, I don't know why it's not coming up on my email, but if you could ask uh it if that could get loaded back in, that would be helpful for me. Um, >> verifying question, is it just the electric outage notifications that you're not getting or have you not been seeing the water ones? Also,

2:20:56 >> I don't when I go to GIS, nothing populates the outages. Yeah. Um, I assume all commissioners want to see those. So, I'll make sure everyone is on both current lists for water and electric. >> And then, and then finally, uh, I I appreciate the weekly updates that we we that you send out to the whole staff. It's it's nice getting that and being able to read that. So, I really appreciate that those are going out and I think that that that's a positive thing for the organization and and to be able to read what's going on in in your head, John. >> Yes. Go ahead. >> So small, but I'd mentioned this to John is that sometimes when we eat dinner at the board meeting, it's very awkward in

2:21:42 here where we're trying to shovel food in our mouths and um but there's people watching us. So, um, I just asked if it was possible perhaps before the meeting if there was a place where we didn't all have to bring our food in here and eat. So, I don't know how everyone else feels about that, but as a possibility, >> we'll find one. >> Yeah, we we can make that happen. >> That that would be easy. >> As soon as we have a prime dinner, >> the legacy of Britney Schlash. >> So, I do I do have one thing to pull the board. Um I I think at least four of us are going to go to the nuclear uh facility and you saw the travel um options and I assume that that to go up

2:22:27 and back in one day is not an option because of the timing. You know we we would arrive there at 10:00 and the tour starts at 11 and it's a 30-minute drive given you know there could be a smoke delay or whatever. So, we're going to have to go up on on I think on a Tuesday and then spend the night and then we don't get back till midnight the next night. And is everybody okay with that itinerary? >> Be Monday night. >> Monday night, Tuesday. Yeah. >> Did we get a >> yet? Oh, okay. >> Yeah. But I'm I but I given the short notice. I mean, it's only two weeks. It's the 18th and we would leave the 17th and uh fly up to Tri Cities, I guess, Pasco Tri Cities and then spend the night and then go through the

2:23:12 nuclear facility the next day and then fly home but we won't be back until midnight. >> And and I looked at flights and it was like you could do it at 4:00 or 5:00, four o'clock flight gets in at 6 at night and then basically a six o'clock flight coming back with a delay in Seattle for a couple hours. dinner. >> Okay, everybody, you know that that that's just coming. I just want to make sure because there's a one day option, but it's it's not really an option. So, >> done that one day before that was >> just making it there. >> Okay, we're good with that. Well, with that then I'm just going to adjourn this meeting and say everybody enjoy your evening Paul.