2026-10-29 - Board of Public Utilities Meeting and Retreat

00:00.45] Okay. Welcome to our regularly scheduled board meeting.

00:04.83] And then followed by that, we will take a break and work through our retreat items.

00:11.07] I'd like to call the meeting to order, and I would like to just remind everyone

00:15.24] that even though we don't see the cameras, like we did at Jordan Valley when we

00:20.07] were there for the retreat, this is being recorded.

00:23.10] We do have the microphones on, and the cameras are on recording our public meeting.

00:29.04] I will start with our mission moment.

00:32.04] This month, we reflect on City Utilities' core value of inclusion.

00:36.72] For CU, inclusion means more than simply welcoming others.

00:41.25] It's about showing up for the community, serving fullheartedly, and being there for

00:46.38] neighbors, no matter our differences.

00:49.17] Recently, Nathan Boone of our physical security team.

00:53.88] His picture is on the screen, but he is also at the back of the room, right here.

00:58.59] That's Nathan.

01:01.74] He recently demonstrated exactly what that looks like in action.

01:05.88] While on duty, Nathan witnessed an accident off CU property across the street, and

01:11.40] he didn't hesitate to help. He stepped forward as a first responder, providing

01:16.47] critical care in

01:18.99] the moments that every second mattered.

01:21.75] His response reminds us that our commitment to safety and service extends far

01:27.30] beyond the CU facilities. For physical security, protecting people isn't just part

01:32.70] of their job, it's part of who they are.

01:35.82] Their dedication not only safeguards our employees, but it strengthens the

01:40.02] wellbeing of our entire community.

01:42.48] This is inclusion lived out, seeing a need, stepping in, and caring for others

01:47.85] because they're part of the community we proudly serve.

01:51.36] So, Nathan, we say thank you today for your positive impact.

01:59.88] Our first item of business is item 1A, the 2027 board meeting schedule

02:06.09] was included in your board materials for consideration.

02:09.75] Is there a motion to approve item 1A?

02:14.43] Move.

02:14.61] Jeff makes the motion, and I saw... And Aaron will second it. Any discussion?

02:21.00] All of those in favor, please say yes.

02:23.58] Yes.

02:24.09] Any opposed, say no.

02:26.79] Okay. Our next item of business is approval of the minutes.

02:30.30] If there is no objection, the minutes contained in your board materials, items 2A

02:34.92] and 2B, will be considered approved.

02:39.30] Okay. Hearing no objections, the minutes are approved.

02:45.06] Our next item is public comments. Do we have any public comments at this time?

02:49.17] Okay. No public comments. We do not have any committee reports, and so that takes

02:53.79] us to our financial statements. At this time, I'll ask Ms.

02:57.00] Amy Dearduff to present the financial statements for board consideration.

03:01.02] Welcome, Amy.

03:02.76] Good afternoon.

03:06.12] All right. So today, we are going to be reviewing... Uh-oh.

03:09.75] I don't know what happened.

03:17.37] So I'll go ahead and... We've allocated 20 minutes, so that's one.

03:24.45] I will start over here. So we're reviewing our full 12 months ending...

03:33.09] So we're reviewing our full fiscal year 12 months end of September 30th, and our

03:38.01] September performance was in line with what we have seen so far from a fiscal year

03:42.63] to date perspective. As no surprise to anybody, September was extremely hot.

03:48.48] We talk about cooling degree days and what that means for our customers, and that

03:52.89] is the propensity to need cooling in your home or business.

03:57.15] We expected to have 196 for the month of September, and we had

04:01.74] 477. So more than double. Significantly higher.

04:06.75] Also, last year's was 238. So much, much warmer this September, and you'll

04:12.75] see that reflected in some of the statistics as we move along.

04:16.71] We continue to be very dry. We had one half inch of rain in September, and as of

04:22.71] two days ago, our lake levels were at 75%, and we did have one pump running,

04:28.95] and we are planning to turn on another pump.

04:35.16] Looking at our heating degree days and cooling degree days for the year.

04:38.43] Our cooling degree days overall were 36% higher for the fiscal year, and they're

04:44.19] 30% higher than the prior year. So as we hear about our customers having higher

04:49.68] bills than last year, part of the reason is the volumes were higher, as we look at

04:54.96] those summers. Heating degree days, which is largely driven by the heating season,

05:00.72] was 19% below our overall average and our budget.

05:07.44] We review our energy sources that are serving for CU alone.

05:11.49] And as we start from the most prevalent to the least prevalent, 35% of our sources

05:17.19] were customers were served with coal.

05:19.86] 33% were served with zero emission, such as wind generation, hydro,

05:25.92] and solar. We had 27% that came from the market and SPP, and that is a

05:31.47] combination of resources. It could be anything from solar to wind

05:37.35] to coal to natural gas or other sources.

05:40.44] And then rounded out with natural gas at 4%.

05:44.04] So pretty similar to the prior year.

05:50.85] Looking at our revenue volumes for the year.

05:53.13] Overall revenue volumes from a retail perspective in the electric segment was up

05:57.66] 5%, and overall resale volumes or off-system sales were down 33%.

06:03.96] We've talked many times that our retail sales are driven by what the market

06:08.31] commands. So that looks at what the market needs are, what our unit availability

06:14.01] is. And so the market has not called on our units as much in fiscal

06:19.17] 2026. In September, we did have, for our retail sales, our

06:25.17] customers had 22% more million kilowatt hours, our retail customers, than we did,

06:31.83] compared to budget. So again, much, much higher for our customers.

06:35.73] Overall volumes for natural gas for the year is down 10%, and our power generation

06:40.83] natural gas consumption is down 19%.

06:43.68] Again, that relates to those off-system sales and when those units are called on.

06:48.09] For water, we see 8% higher than where we planned, and that's largely due

06:54.21] to some of the drier conditions that we have.

06:59.58] Moving on to operating revenue, we are at $627 million for the fiscal year,

07:05.10] 5% above our budget. And as a reminder, this does include fuel and purchased power

07:10.47] cost that we pass on dollar for dollar to our customers.

07:14.07] So as we see higher fuel cost and higher purchased power cost, our revenues do go

07:18.90] up for that. As we look at our revenues compared to prior years, since that is a

07:24.66] greater difference than we typically see, I wanted to call that out.

07:28.89] And that's largely due to those volumes that we talked about.

07:32.19] So this summer especially, customers have used a lot more electricity, for

07:37.89] example, than they did in the prior year.

07:40.59] Also, fuel and purchased power costs were higher in 2026 than the prior year.

07:45.93] And then we also have rate increases across all three commodities, electric,

07:50.79] natural gas, and water. So looking at electric, when we see the favorability,

07:56.19] that's driven by an overall retail sales consumption is the biggest driver of

08:02.19] that when we compare that to budget for the current fiscal year.

08:05.79] Natural gas is lower than budgeted due to our volumes.

08:09.57] In transit, we were about flat with the prior year, but our ridership is up 8% year

08:15.21] over year on our bus system. Spring-NET is flat to budget, and our

08:20.88] overall volumes for water were up, and that accounts for the favorability in the

08:25.56] water system.

08:31.65] Our fuel and other production costs are $235.5 million

08:37.98] and just slightly under budget. And overall, that's driven primarily by natural gas

08:42.84] volumes being lower and then offset by our electric segment due to higher pricing

08:48.81] as well as higher volumes that we talked about on the previous slides.

08:54.97] Moving to our operating margin,

08:58.18] which is what we have available to spend for our operating expenses as well as our

09:03.79] capital and debt service. We are at $392 million, or 10% higher than budget.

09:10.06] And this is the net of the two previous slides.

09:12.97] So looking at electric retail volumes, we're the biggest driver on this.

09:17.68] We did have favorable margin when we look at our all system sales from a pricing

09:22.75] perspective. Every year when we put together the budget, we work with the energy

09:27.46] authority to put together a model that is going to put forth the best evaluation

09:32.65] that we can of what those prices are going to be.

09:35.29] But those aren't our retail customer prices that are set by our rates.

09:40.18] They are set by the market every single day.

09:43.00] And so we are predicting that, and this year we predicted lower prices than what we

09:48.61] saw in the market. So again, compared to budget, we performed better in those all

09:53.17] system sales because of pricing. Overall, natural gas volumes, again, those were

09:58.15] lower impacting margin, and then Spring Net and transit are flat to budget, and

10:03.28] water is higher due to our open calls.

10:08.95] Our operating expenses are right in line with budget.

10:11.86] They're about $8 million higher, and that's primarily driven by the electric

10:16.15] segment. We had increased maintenance costs across our electric line area as well,

10:21.70] transmission distribution, as well as our power supply areas.

10:25.69] We also increased amortization that was not included in the budget, and that's

10:30.97] about $4 million, and that is on our asset retirement obligations that we have

10:35.74] recorded on our financial statements for future closure of our power

10:41.44] generation facilities. And that is something from an accounting perspective that we

10:44.71] are required to report. Natural gas, we have favorability of $2 million, but really

10:50.68] that is timing. As we will talk about at the next board meeting is our carry-in

10:55.06] budget, which many of you are familiar with, and so that favorability for that

10:59.26] particular non-cash project will be carried into the 2027 year and spent at that

11:04.96] point in time. We have our transit, Spring Net, and water that are all in line with

11:10.48] budget.

11:13.96] Coming to our operating income and loss of $106 million for the current year

11:18.97] compared to our budget of $78.7 million.

11:23.23] Electric is the largest share of this at $91 million.

11:27.22] And as part of that favorability, as we've talked about, cost for our power supply

11:32.35] and equity funding a portion of that, we have reserved a portion of those dollars

11:37.66] to fund our power supply reserve, and we'll touch more on that as we get to the

11:41.44] cash line towards the end. Natural gas is $7.2 million, just slightly

11:47.47] under budget. Transit at a loss of $14.9 million and in line with budget.

11:53.02] Spring Net,

11:55.00] in line with budget, and water, $3 million higher than budget.

12:03.34] Our change in net position is a combination of our operating income as well as

12:07.66] those items that are below the line.

12:10.12] And this year we had a little more activity in those below-the-line items that are

12:14.38] non-operating in nature. So we had $27 million favorability in operating income.

12:20.53] Interest income as a result of our construction funds that we have invested, that

12:24.88] we're using for the debt proceeds on our power supply project, was a favorable $6

12:28.69] million. We did record our FEMA obligation for our April 29,

12:34.84] 2025 storm that we had, and that is an obligation saying, "We are going to commit

12:40.51] to paying this to you, and we agree with the amount that you submitted, but we do

12:44.14] not have those funds yet." Again, that's $6 million and in line with what we

12:48.34] expected. We have favorability on our investment in TPA of $2 million.

12:54.34] We are offsetting those favorabilities with our $8 million recognized expense for

12:59.29] our Main Avenue Subsite 2 remediation.

13:02.59] So while we do expect to have funds to offset that, we don't get to recognize the

13:07.24] expected funds now. We are required to recognize the expected expenditures,

13:12.64] and the funds will not be recognized until they are technically obligated

13:18.55] by those other entities. We also have higher-than-budgeted pilot because our

13:23.65] revenues were higher, and so that was a little bit of unfavorability when looking

13:27.70] at the budget.

13:31.69] Our accounts receivable did increase pretty significantly in the month of

13:36.52] September. We went up from the previous month of $3.6 million, and we are

13:42.49] $3 million higher than budget. Our arrears continue to be in line with budget.

13:46.99] They're $4.9 million, so a little bit higher than what we have seen.

13:51.40] And again, our customer service area and conversations with them, have seen

13:55.66] increased calls with customers who have higher bills.

13:59.41] Again, that's driven largely by that consumption when it was so hot, and the air

14:05.38] conditioning units had to work so much harder.

14:07.81] So we always encourage our customers to call, work with our great staff that's

14:12.07] there to provide that service to them, and work on payment plans before it becomes

14:17.62] too late in the process where a shut-off would be issued.

14:22.54] Compared to last year, we have about 500 more customers on payment plans than we

14:27.52] did in 2025.

14:31.93] Our natural gas costs continue to remain stable, and as we look at future

14:37.63] costs, we expect a warmer winter. That is currently what the very long-term

14:43.45] forecast is, and so we do expect those prices to continue to remain stable.

14:50.92] And speaking of winter, our natural gas storage volumes are poised and ready for

14:55.15] the heating season. We have 2.1 million deck therms and our storage that holds 2.4

15:00.22] million, and we do leave some headroom in there.

15:03.13] And so as we plan each day for those volumes of natural gas that we need, if we

15:08.71] have excess natural gas, if it's a warmer day than what we think we're going to

15:13.24] have, we will inject those additional volumes into our storage for our customers.

15:20.68] Our coal volumes continue to remain steady at 149,000 tons and at a burn rate

15:26.59] of 4,000 tons a day. This gives us 37 days of coal that we have on the ground at

15:31.63] our John Twitty Energy Center.

15:36.28] So evening things out, our cash position, we have a working capital amount of

15:43.06] 112 days of cash, and that is more than budget by seven days.

15:49.45] And so those dollars, and we talked through this last year, but it's been a year,

15:54.43] but many of those dollars will be used for our carry-in projects.

15:59.02] So as we don't spend dollars for capital, typically because of timing or

16:04.36] circumstances a little bit outside of our control, we have a process and

16:09.94] policy that next month where those dollars are allowed to carry forward to the next

16:15.82] fiscal year. And so the unspent cash will be used to fund those dollars in the next

16:21.16] fiscal year. This is also net of those power supply reserves that I mentioned

16:26.56] earlier that were set aside to equity fund the portion of the power supply

16:31.39] construction for the McCartney combustion turbines that are being installed, as

16:35.89] well as the battery power supply.

16:40.66] Lastly, we have our community dividend, and we have $42.1 million this year

16:45.94] compared to $39.6 million in the prior year.

16:50.23] So the biggest mover in that, as you'll see in the top, was the city received an

16:54.37] additional $1.8 million in payments in lieu of taxes.

16:58.54] So from a cash perspective, utility services, so those free services that our

17:03.37] customers pay for that are provided to the city at no charge, were at $13.7

17:08.77] million. Our right-of-way fee, which I skipped right over, is $800,000.

17:14.29] And then our public transit services subsidy that is paid for by our electric,

17:18.34] natural gas, and water customers was $9.7 million.

17:22.36] Going below that, those relocations and other community services, we have $3

17:26.50] million this year, and that of course aligns with those projects that we work on

17:32.17] with the city, and we did not have as many of those this year from that

17:35.95] perspective. And then we had outside of city expenditures of $4 million that could

17:41.92] be relocations or any other type of service.

17:46.66] With that, that concludes my remarks, and I would be happy to answer any questions.

17:52.30] Are there any questions for Amy at this time?

17:54.25] Quick question.

17:54.79] Yeah.

17:55.30] We mentioned accounts receivable lagging. Can you repeat the reason?

18:00.62] Our customers, those are more customers that are liking-

18:03.47] So, we have 500 more customers this year-

18:06.74] 500

18:07.16] ... that are on than they had the prior year.

18:10.13] So not as high as I would've expected, given the amount of how much the bills

18:16.28] went up, as well as the really hot, really hot months that we had.

18:20.27] And you're-

18:20.75] Some of those bills are

18:23.18] being received now, though, for that usage in September.

18:26.66] Thank you.

18:27.98] Any other questions for Amy? Steve.

18:29.81] Can you expand a little bit on market purchase as it relates to electricity?

18:33.89] Does that come from SPP?

18:36.17] Yeah. So anytime we make a market purchase, that comes from our Southwest Power

18:40.01] Pool. And so every day,

18:43.37] we tell the market, "These are the generating resources that we have." And every

18:48.53] day we tell the market, "These are the megawatt hours that we need every hour,

18:53.45] every five minutes to serve our customers." And then the market dispatches

19:00.92] those units to us. And so if the lowest cost units available are our

19:06.74] units, then those are going to be dispatched first, and so they typically are, and

19:10.43] that would be our two coal-fired units at the John Twitty Energy Center.

19:14.27] And then typically, that would be followed by market purchases, which could be more

19:20.60] cost-effective than our combustion turbines that we have.

19:24.53] So the market, every day, we work with to determine what is the lowest dispatchable

19:30.23] cost for our customers, and that comes from our overall Southwest Power Pool

19:35.24] footprint.

19:36.71] Thank you.

19:39.38] Ryan.

19:40.82] You mentioned transit. Ridership was up 8% this year.

19:44.12] Why do you think that's happening? That's a sizable jump.

19:49.40] So I'm going to ask Kelly Turner to be prepared for that question.

19:53.60] So,

19:55.73] we have somewhat recently made those service changes, hours,

20:01.28] routes, and fares with fare reduction.

20:04.37] So we really believe that is in large part due to that continued adoption of that.

20:09.11] We do expect that'll plateau, but typically about a two-year or so period where

20:13.55] that all kind of settles in, and then eventually we think that'll plateau.

20:16.13] But then combine that with higher gas prices, so that's another thing that I think

20:19.82] certainly boosts that a little bit.

20:22.34] Thanks. Anybody else? Questions for Amy?

20:28.79] Okay. Is there a motion to approve the financial statements included in item 5A?

20:35.00] Motion.

20:36.38] Jeff will make the motion, and Ryan Hoover will second it. Is there any discussion?

20:43.55] All those in favor, please say yes.

20:45.53] Yes.

20:45.77] Yes.

20:46.34] Any opposed, say no.

20:49.01] Thank you, Amy. Up next, we have the President's Report.

20:53.12] Dwayne will present and has a couple speakers.

20:56.12] We have allocated 40 minutes for this section. Welcome.

21:00.89] Thank you, Chair Leonard. Good afternoon, everyone.

21:03.41] As always, or as typical, I have several employee recognitions to start off the

21:08.39] President's Report. First of all, on September 25, the day after the last board

21:12.41] meeting at the Springfield Tech Council's Excellence in Technology Awards, Lauren

21:16.52] Gooden, our IT Business Intelligence and Analysis supervisor, was named the Small

21:21.65] Team Technology Professional of the Year.

21:24.59] Lauren and her team continue to advance the way CU uses data, analytics, and

21:29.06] technology to solve challenges and deliver value for our customers.

21:33.47] We are grateful for their dedication and impact.

21:36.53] In addition, our Business Intelligence and Data Science team was a Technology Team

21:40.85] of the Year finalist, our GIS department was a Technology Transformation Award

21:44.99] finalist, and SpringNet was a finalist for Top Exhibitor Booth at STC Squared.

21:53.12] Our IT Business and Intelligence and Analysis team was also recently named a

21:57.50] finalist for a Utility Analytics Institute Excellence Award in its Best Innovative

22:02.93] Utility Analytics Team category.

22:06.05] Competing alongside organizations the size of Southern Company and New York Power

22:09.71] Authority underscores an impressive accomplishment and a meaningful recognition for

22:13.85] the innovative work happening at City Utilities.

22:16.79] Reaching the finalist stage is a testament to the outstanding work the team

22:20.84] continues to do. On October 8, Marsha McClanahan, Director of Energy Services and

22:26.81] Renewables, was honored with the Missouri Public Utility Alliance Honor Award for

22:30.95] her outstanding service to our municipal utility.

22:34.04] Marsha has been a valued employee at CU for 33 years, dedicating much of her career

22:38.54] to helping customers with energy, water, and money.

22:42.11] Most recently, she played a key role in launching our Peak Rewards program.

22:46.43] Thank you to Marsha for her outstanding contributions throughout her career.

22:53.06] This month, we have seen on our social media, we celebrated our customer service

22:56.93] representatives during Customer Service Appreciation Week.

22:59.96] Our customer service representatives make a difference every day.

23:03.50] They are problem-solvers, patient listeners, and reassuring partners, often

23:07.58] providing comfort and clarity when issues arise.

23:10.58] We're deeply appreciative of their commitment to making sure our customers feel

23:14.15] heard and appreciated.

23:17.69] This week, our operating areas participated in safety workdays, engaging in

23:21.62] training and discussions centered on our core value of safety.

23:25.25] In fact, it's our number one core value.

23:27.41] The safety team continues to design meaningful learning experiences that keep

23:31.67] health and safety at the forefront.

23:34.22] Thank you to all employees who participated, and especially to the safety team for

23:38.18] their ongoing leadership.

23:42.44] The latest edition of CU at Work is out now, spotlighting former general manager

23:48.05] Robert Rountree's legacy, our Energy Services department's 20th anniversary,

23:52.82] SpringNet's impact on businesses across the community, and more.

23:56.63] A link to this edition of CU at Work is on the screen and available to you in

24:01.01] BoardDocs. It's my honor and privilege to wear Robert Rountree's old lapel pen,

24:06.80] given to me by Jeff Berzoli, who received it directly from Mr. Rountree himself.

24:11.87] So it reminds me every day of the weight and responsibility of this role.

24:17.15] Next, I'd like to invite Kelly Turner, our Vice President of Customer Operations

24:20.69] and Communications, to give us an update for in those areas.

24:23.57] And directly following him, Katherine Thompson, our Senior Legal and Regulatory

24:27.89] Counsel, to give us an update on the large load task force.

24:40.37] Thank you, Dwayne. Good

24:41.96] afternoon. Good afternoon.

24:44.84] It's great to get another opportunity to share with you some of the things that we

24:48.41] are doing in customer operations and communications.

24:51.77] So I'm just going to briefly touch on a few items of interest today from some of

24:55.40] these areas.

24:59.12] First, I want to talk about a couple of customer reporting tools that have been a

25:02.87] partnership between several different areas across the company, customer

25:06.71] experience, customer services, communications, IT, and some of our operating areas

25:12.38] play a role in this as well. We have a new streetlight reporting tool available

25:16.31] through our website. You might, may or may not be surprised to know that

25:20.33] streetlights are something that our customers pay a lot of attention to, and they

25:23.60] want to make sure that we get those back in service when there's issues.

25:26.69] And so we frequently get reports about streetlight outages or damages.

25:30.74] And customers would previously report these in a number of different ways.

25:36.26] It wasn't always clear how to do that, and it was a pretty manual process then on

25:40.64] the back end for us to get that work assigned.

25:43.85] And so that process would present an opportunity for confusion between us and the

25:48.71] customer. So now with this tool, customers can use an interactive map.

25:53.90] They can specifically select the streetlight that they want to report the

25:58.31] information about. They can even get information about if that streetlight's

26:01.91] already been reported and where that might be in the repair process.

26:05.90] It also helps streamline our process on the back end.

26:09.23] This is already in use on the website with good success, and we are excited about

26:14.00] the improvements for our customers and our operation going forward.

26:18.20] Similarly, on the other side of the screen, there are other things that our

26:21.56] customers want to report to us that might not be urgent.

26:25.67] Not a power outage, not a natural gas smell, but things like a leaning

26:31.31] utility pole, a leaky fire hydrant, maybe a damaged bus stop.

26:37.01] We are working on what we are calling a spot and report tool, where customers can

26:41.27] again use an interactive map. They can note or identify the asset or the

26:47.21] location that they want to report information to us, and there'll be some type of a

26:50.96] free-form dialogue box where they can input that concern that they have, and it'll

26:55.70] get reported to us. It's not yet live, but we are working towards completion and

27:01.52] optimizing for external customer use. We hope that you'll see that before too long.

27:08.78] It'd be difficult to go through a day of presentations without talking about AI in

27:12.29] some form or fashion. So I want to give you just an update on some of our progress

27:16.61] on some AI tools that we are incorporating into our customer services contact

27:20.84] center. First, the virtual trainer.

27:23.96] As you might imagine, our customer service representatives have a very large

27:27.41] training manual, and with the help of our customer experience team, our customer

27:32.06] service team, the IT team has developed an AI agent that's a virtual trainer for

27:37.37] our CSRs. So rather than when they have a question after they've completed their

27:41.54] training, rather than searching through that large manual, they can simply ask the

27:46.61] agent, just like you would your favorite AI tool,

27:51.86] and it would give them that answer.

27:53.33] So it might be something like if a CSR wants to know, how can a customer avoid

27:58.94] paying a utility deposit? They can just ask the agent.

28:02.67] It'll give that answer along with the reference in the training manual where they

28:06.26] can verify that if they'd like to. So a big improvement in efficiency for our CSRs.

28:12.14] Next, we've recently implemented an AI tool that provides auto summary and call

28:17.25] disposition for our CSRs. So rather than our CSRs being on the

28:22.67] phone and trying to jot down notes about that call and about that customer's

28:26.96] experience and then hurriedly inputting that when the call is over before they get

28:31.07] the next call fed to them, this AI will continually take those notes as the call

28:37.07] is going on. So at the conclusion, the CSR just has to validate those notes and

28:42.20] automatically gets uploaded to our customer contact system.

28:45.14] So real improvement to efficiency and productivity.

28:49.23] The third item here is we are currently in the early stages of working on a quality

28:53.51] assurance tool for the contact center.

28:56.33] We, of course, have a current QA program where we listen to a sample of calls

29:01.31] throughout the month, provide coaching and guidance.

29:04.19] But this system will assess every customer call that we have through our system,

29:09.17] and it will screen for things like sentiment and empathy and our providing the

29:13.19] accurate information to our customers.

29:15.23] And it'll give us a much deeper understanding of the experience that we're

29:18.89] providing our customers. It'll help us in our coaching, our training, and ever

29:23.63] furthering the customer experience.

29:26.36] Finally, we continue to explore future options for conversational IVR, that is

29:32.09] interactive voice response. That's simply when you call, that's the voice that

29:35.54] answers on the other end. The idea is certainly not to move away from human CSRs.

29:40.94] You've heard today how much we celebrate our CSRs and how proud we are of what they

29:44.99] do in customer service. They provide great value for our customers to be able to

29:49.25] talk to a person. But we do want to provide customers an effective way to

29:54.53] self-serve if they desire for those most common reasons that they call our contact

29:59.87] center, and then hopefully start to provide some of that self-service availability

30:04.92] outside of the hours that our contact center is actually open.

30:08.03] That's a limitation today, is that we have limited hours for the contact center.

30:11.69] So if we had a conversational IVR that did a good job, then our customers could do

30:16.50] that in off-hours. We think that might be an important offer.

30:23.78] I want to move on and talk about our meter-to-cash effort.

30:26.12] I've spoken to you previously about the work that this task force is doing to

30:29.61] improve our effectiveness in identifying metering, reporting, and collection

30:35.45] issues that might occur. This task force has been in place for almost three years

30:40.25] now, and we've had these great results. Dwayne mentioned Lauren Goodin earlier.

30:44.75] We've recently added her, a supervisor in IT, to this task force.

30:49.64] As this task force has really started drilling into business processes and the

30:53.30] technology solutions, she's been a tremendous asset to this task force.

30:58.34] And now we are also restructuring our billing department.

31:01.55] It's currently been known as our billing department.

31:04.58] It's now going to be known as billing and revenue integrity.

31:07.64] We're going to have some new roles within there that will allow us to more clearly

31:12.02] define roles and responsibilities as well as take a more analytical approach

31:17.33] upstream so we can hopefully find those issues before we have to do billing

31:21.92] adjustments and corrections on the back end.

31:25.19] And then we continue to drive continued cultural clarity across the organization,

31:30.02] really stressing the importance of excellence in this arena so that our customers

31:34.47] can expect timely and reasonable adjustments.

31:37.79] And we're really proud of the buy-in that we've seen across the organization as

31:41.73] we've been able to push this effort forward.

31:47.00] I want to share with you a couple of charts to illustrate the excellent outcomes

31:50.12] from the meter-to-cash task force.

31:52.47] On the left, you see a chart showing the number of adjustments required each year,

31:57.53] and also the number of months that is needed to be adjusted when an issue is found.

32:02.73] Certainly, the number of adjustments fluctuates because we have done a better job

32:06.42] of identifying issues that are out there.

32:09.59] But I would draw your attention to the reduction in the number of months to be

32:13.04] adjusted. From nine point two months of average adjustment in twenty twenty-two,

32:18.95] down to only a month and a half this year.

32:22.01] And so really evidence that we are being more timely in our identification and

32:26.33] resolution of customer issues on the billing side.

32:30.53] The chart on the right shows the trend of our unbilled meters each quarter.

32:34.10] We're really proud of that significant downward trend that's obvious when you look

32:37.82] at the chart. So really great work all around from the meter-to-cash team and all

32:42.26] those that are involved in that

32:47.84] effort. I want to keep you all apprised of the status of the transit white paper

32:52.23] that our consultant is working on.

32:54.17] This is, of course, related to some of the interest that city council has developed

32:58.40] in transit expansion and a request for a white paper to help identify

33:04.22] really what characteristics that a future Springfield might grow into that would

33:10.16] signal for the community to look again at transit expansion.

33:14.42] And then also as the funding solution really looms large over any discussion about

33:20.21] transit expansion, the white paper will touch on that topic as well.

33:24.77] And I believe that the council's Finance and Administration Committee will have

33:28.16] some upcoming discussions about potential funding opportunities.

33:32.30] We did receive the initial draft deliverable last Friday, just as scheduled.

33:37.61] We're currently reviewing that document to get comments back to the consultant and

33:40.85] expect to have the final report back around November

33:48.68] 20th. Finally, we did a few things today on our communications and

33:53.15] community relations front. We often talk to you about our mass communication

33:58.28] efforts. That's our

34:00.14] texting, that's our advertisements, that's our media releases, all those things

34:04.46] that we do on a mass scale. But we also continue in our grassroots community

34:08.99] engagement efforts. We recently had an opportunity during Public Power Week to have

34:13.19] one of these events. On the evening of October 8th, we held a We're Your Neighbors

34:18.44] event at the Boys & Girls Club Henderson unit.

34:22.55] This was an interactive event to introduce kids and families to the people, to the

34:27.11] services, to the equipment behind City Utilities.

34:30.32] We had approximately 90 students, kindergarten through fifth grade, as well as

34:34.43] about 25 parents that engaged with our staff, with our equipment.

34:39.98] We had utility employees from water treatment, transit, electric line,

34:46.10] safety department, forestry, damage prevention, energy services, and of course,

34:51.02] communications. The kids got to do things like check out our equipment, honk the

34:54.62] horn on the bus. We gave away energy efficiency kits, and so just a really great

34:59.42] event and hopefully a template for what we can do other times in the future.

35:06.20] I'm also proud to announce that our communications team here at City Utilities

35:10.13] recently received two awards from the American Public Power Association.

35:14.15] Here's Joella Foster, one of our communications supervisor, accepting our awards

35:18.32] this week. The first was an Excellence in Video for our TikTok account content,

35:24.89] and the other was Excellence in Web and Social Media for our That's Shocking

35:29.48] podcast. And I would just say, if you have not listened to the most recent episode

35:34.43] of the podcast with former CU General Manager Scott Miller, it's really tremendous.

35:40.04] And he does just a terrific job of highlighting the benefits of public power and

35:46.04] the benefits of our governance structure and the value that it provides to our

35:49.49] community.

35:53.12] And lastly, I want to make everyone aware that this Saturday is our annual

35:56.54] Halloween Hustle. This event will again support the Harmony House this year, and we

36:01.91] are really grateful to have Fagon Incorporated as our presenting sponsor for this

36:06.11] event. You'll remember their name as they are the contractor on the majority of our

36:09.83] power supply projects, and so we're glad that they're doing work for our company

36:13.94] and our community, and they're also helping sponsor this great event.

36:17.89] We have a 5K, a 10K, and a one-mile candy dash, so something that fits everyone.

36:23.47] Of course, a Scooby-Doo theme this year, as you see on the screen.

36:27.34] As always, it should be a fun and healthy and charitable way to spend a Saturday

36:30.97] morning. Weather looks great, so we're hoping that we have just a great turnout.

36:34.60] So maybe we will see you there.

36:37.75] Thank you very much. And that concludes my report.

36:40.00] So what additional questions might you have?

36:42.19] Any questions for Kelly at this time?

36:44.71] Probably not questions, just a comment.

36:48.16] I had a flashing streetlight right down the road from me.

36:51.55] It was setting off my Ring camera on my driveway to the point of annoyance.

36:55.36] Okay.

36:56.65] The same day, I downloaded the Muse app, and I talked into my assistant Muse app,

37:02.56] and it basically pointed me right to the direction of the website.

37:06.52] Perfect.

37:06.88] Filled it out in less than probably a minute, and then within I think seven days,

37:11.32] the light was fixed. So super slick and very easy to fill out and very cool.

37:16.54] So great job.

37:17.44] Love to hear it. Thank you.

37:19.42] Questions? Steve.

37:21.28] Along that same path, is there any ambition, talking along the line of continuous

37:26.35] improvement? It's sort of strange that we have customers that have to-- or we rely

37:30.97] on a customer to call us whenever a streetlight is out.

37:34.63] Is there technologies that we're looking at now to where it can be self-reporting

37:38.17] when a streetlight is out, that it pings?

37:41.05] We've moved to the point where we don't have to have to read meters anymore.

37:44.50] Sure.

37:45.19] So could we not find the technology that would self-report-

37:49.75] I'll call Streetlight.

37:53.59] So looking at it at a high level, I think for scale, it's important to understand

37:57.97] we manage about 20,000 streetlights throughout the city,

38:02.44] and they're all connected differently electrically.

38:04.81] That's the challenge with a system that's where all that data's got to come back

38:08.89] through a common path.

38:12.16] Over the years, when we did the AMI project, one of the things we looked at was

38:16.21] installing different pucks within all of our streetlights and the tops of those to

38:21.04] build that network as well. And the challenge with streetlight systems is some of

38:24.67] those have that ability to install those and some don't.

38:28.96] So not only do we have 20,000, we have a dozen different styles.

38:32.68] So it's something we're paying attention to, keeping an eye on the technology.

38:36.55] But due to the diversity in our system, it's been a struggle for us to get there.

38:42.67] Thank you.

38:43.12] Any other questions?

38:46.15] I just have-- First of all, I love the

38:49.75] streetlight reporting tool and the other kind of the triage, kind of like city

38:54.55] utility triage- Yeah

38:55.87] ... reporting thing, that you see that it's wrong.

38:58.93] So I think that those are great improvements.

39:01.96] My question is, have we made any headways with how we could

39:08.11] show people how to use that and not just pushing it out to public

39:14.08] or

39:15.49] whatever, but whether that's...

39:19.75] I don't know, have we been able to identify who every homeowners association

39:26.02] president is, and then using the NAC council, and like, having somebody present and

39:31.41] show just so that people can

39:35.80] know how to use that? Have we made any headways with that-

39:38.71] So-

39:38.73] ... type of communication?

39:39.79] So a few things. I think, first of all, like Ryan said, I think it is pretty

39:42.58] intuitive.

39:44.35] But we are mindful of making sure that not only is the tool itself intuitive, but

39:49.57] that it's in a location on the website that you don't have to dig and search for a

39:55.06] long time to find it. So we're mindful of that.

39:57.52] But as far as pushing out communication about that, I don't know that we've done

40:01.66] that specifically. That's a great idea.

40:03.34] Whitney Mann is our Community Relations Specialist, and she is frequently engaged

40:07.12] with the Neighborhood Advisory Council and gives presentations like that from time

40:10.87] to time. I think that's certainly something we want to add to the list.

40:13.27] Thank you for that suggestion. She also has done a nice job, and Karen and I

40:19.24] had a discussion about this today, working with those different neighborhoods, and

40:23.47] many of them have their own social media pages, Facebook pages with an

40:27.37] administrator. And so she makes those connections.

40:30.43] That's a good avenue for us to push some of our messaging through maybe a trusted

40:35.62] advisor in that neighborhood that could share it or repost it.

40:38.77] And so that might be a really good message that we put together in a post that can

40:42.28] be pushed out through those social media channels.

40:44.62] Yeah. I think that's a great idea. And I love that we have the NAC that's

40:49.27] organized. I just wish this is a community problem that we could maybe take a lead

40:54.25] on, which is helping identify all the other neighborhoods that are outside the NAC

41:00.22] that are well-established, that have internal communication channels, through

41:05.71] either through email or Facebook or whatever social media.

41:09.64] But just really getting those on our list.

41:13.06] The other thing I'm thinking about are seniors.

41:15.91] Having just taken my mother and father-in-law to their doctor's appointments and

41:19.39] not being able to check themselves in on the iPad.

41:22.84] Right.

41:22.93] So while those are great for those of us that are comfortable using

41:29.89] that way of reporting,

41:32.98] would seniors still just call in the main customer service line?

41:36.43] Yeah. Certainly, if someone contacts us with that information-

41:38.83] Yeah

41:38.95] ... we're not going to say, "Oh, I'm sorry.

41:41.50] Go to the website." They're certainly welcome to give us the information that way.

41:45.19] Yeah. Okay.

41:46.84] Another idea that Kelly and I talked about that's just in the formative stages now

41:50.26] is potentially having our own customer IT support staff.

41:53.89] So we have IT support staff for our employees currently.

41:57.13] We contract vendors to provide some of our interfaces that our customers use, but

42:01.09] as we have more in-house interfaces, we're thinking about having some

42:04.96] outward-facing customer support within the IT and tech area.

42:09.82] Any other questions for Kelly before we move forward?

42:13.48] Thank you.

42:14.08] Thank you.

42:14.23] Thank you.

42:16.00] Up next is Ms. Katherine Trefz to give us an update on the large load task

42:22.00] force.

42:27.85] I don't know if it's helping at all, but I will do that.

42:32.14] Thank you all for letting me come speak to you today.

42:33.88] So as Lena said, I'll speak about the large load task force.

42:37.39] And some of you may be thinking, "I've heard this task force a number of times."

42:42.46] Possibly wondering whether I talk about anything else.

42:45.12] But today I want to build on some of the past updates we've given, not just repeat

42:49.42] them, especially with the additional discussion that's taken place, especially in

42:53.41] the last week, about data centers, about data center definitions, and

42:57.73] administrative delay on accepting data center applications.

43:01.66] So

43:04.09] by way of a brief background, the city established its large load task force in

43:09.46] April of 2025 with a couple objectives: to protect our existing customers,

43:15.28] both financially and from a system reliability standpoint.

43:19.33] Also, that includes the large loads, including but not limited to data centers.

43:24.64] Also, we wanted to establish a framework to connect large loads to the city system

43:30.58] that would be predictable, consistent over time, so every applicant would be

43:34.84] measured against the same standards.

43:36.88] And so that work has been underway for about a year now. A year and a half.

43:42.55] Earlier this year, the city put in an administrative pause, a delay on the

43:47.14] acceptance and processing of applications relating to data centers.

43:51.67] We touched on that before, but today I want to cover three things.

43:55.54] So how that delay applies to City of utilities, what the new proposed extension

44:01.21] would change, and what the respective roles of city council would look like as we

44:05.38] move forward.

44:07.30] So a quick recap of where things stand today.

44:11.02] The city's recent bill's ordinance imposing this delay on data centers went into

44:16.12] effect on June 29th of this year, and it is set to expire November 17th, about

44:21.76] three weeks from today. So three features are worth holding onto as I move through

44:26.29] the rest of the presentation. It applies to the city, specifically including the

44:30.97] City's Board of Public Utilities.

44:33.58] It delays the acceptance and processing of applications related to the evaluation,

44:39.70] establishment, servicing, or expansion of a data center, and it allows exceptions

44:45.55] by City Council resolution. So where a project complies with applicable

44:50.08] regulations, where adequate infrastructure exists to serve it, and where it's not

44:55.78] detrimental to the health, safety, and general welfare of the city, the council

44:59.86] can, in its discretion, allow that project to move forward.

45:03.46] So that last point matters. So under the ordinance in effect today, there's kind of

45:07.69] something of a release valve. If a project can be served and it's not harmful, the

45:11.65] council has the power to let it proceed.

45:15.16] So looking at a bigger picture of the original purpose of the delay,

45:21.40] they were almost entirely based on land use purposes.

45:25.58] So those purposes were to consider revisions to the city code and other standards

45:30.74] that protect the health, safety, and general welfare of the community to ensure

45:35.33] planned, orderly development of data center facilities that will be consistent with

45:40.22] the character and welfare of the city and prevent uses that would undermine the

45:45.05] comprehensive zoning plan to develop appropriate regulations and standards through

45:50.54] a comprehensive public process. Also, to allow city staff time to study the issue

45:56.48] and make recommendations to the Planning and Zoning Commission and to City Council.

46:01.04] So I'd ask you to note what's not on the list.

46:03.08] There's no reference to utility rates, to cost allocation, or to rate design.

46:08.03] The original ordinance was framed around zoning.

46:12.71] So I raise that now just because the proposed extension characterizes the original

46:17.63] purpose a little bit differently, and I'll come back to that.

46:21.05] So that brings me to this week. The first reading of Council Bill

46:26.39] 2026-237, the proposed extension of the data center

46:32.51] process, was held on Monday, October 26th this week.

46:36.89] If adopted, it would extend the current administrative delay through February 24th,

46:42.02] 2027. So the structure is a little bit different than the original ordinance in

46:46.46] four main respects. So first, it splits the delay into two.

46:51.56] The Council Bill 2026-237 only applies to utilities.

46:56.78] A separate council bill now addresses land use, zoning, building, fire, and

47:02.90] development applications. So the utility delay part is now sitting on its own.

47:09.14] Second, it defines utility service application for the first time much more broadly

47:14.78] than the data center itself. The definition of that would include, but it's not

47:19.13] limited to, requests for facility extensions, interconnection of generation

47:25.16] or batteries, will serve letters, and standard requests for gas, water, and

47:30.32] electric service. All of those things would be delayed as to data centers and

47:36.26] as they relate to the extension.

47:39.53] Third, this will also prohibit CU from providing site-specific

47:45.29] evaluation of capacity and the issuance of will serve letters.

47:49.61] So CU would only be permitted to respond to general inquiries using publicly

47:54.74] available information. And fourth, unlike the original ordinance, this extension

47:59.75] would not allow exceptions by council resolution.

48:02.96] It defines a set of exclusions only.

48:08.69] So the purposes provided of this extension, some of them follow kind of logically

48:14.33] and directly from the original ordinance.

48:16.46] For example, giving the city staff time to review the feedback received during the

48:20.36] public input sessions to evaluate a full range of options.

48:24.53] And some of the other purposes are considerably broader than the original.

48:28.76] So this extension would allow further evaluation of measures to protect existing

48:34.70] customers, including large load tariffs, contract terms, financial requirements,

48:40.61] minimum demand charges, cost allocation, water supply, and cooling standards.

48:45.89] And if that list sounded familiar, there's a reason.

48:49.13] Those are all within the work that the large load task force has been doing, and

48:54.77] it's what we've been working on for about a year and a half with regular reports to

48:58.25] this board. So additional purposes set out in extension, like I said before, to

49:03.77] prohibit site-specific evaluation of capacity and will serve letters.

49:08.48] It will allow for the extension of pending federal regulations, and it defines the

49:13.37] term process and data center, and it establishes classifications for data center

49:19.22] sizes. So it's not in the previous.

49:23.81] So there's some new language that we, in particular, want to bring this board's

49:27.47] attention. And thus we put them in writing because they do, again, go beyond the

49:32.30] original ordinance in ways that the board should be aware of.

49:35.69] So first, the extension states that the original ordinance was intended to prevent

49:40.46] potential impacts to electric and water systems and on the rates paid by the

49:46.19] customers of those systems. Second, it states that the costs needed to serve a

49:51.17] large data center could, if not properly allocated, be shifted to existing

49:55.64] customers, and that the extended delay is necessary to protect utility customers

50:00.56] from rates and reliability impacts.

50:04.53] Third, it states that all boards, departments, and agencies of the city are subject

50:09.14] to legislative control of the city council.

50:11.93] And fourth, it states that a data center outside city limits, though within CU

50:15.98] service territory, could affect their rates and system capacity available to

50:20.12] customers in the city the same as if that data center were in the city.

50:25.55] Taken together, all those statements kind of move the rationale from the delay from

50:30.47] land use onto rates as it pertains to the utility portion of the delay.

50:35.30] And it also suggests that that would be intended to reach beyond the city limits.

50:42.14] So City Utilities provided some feedback to the city on each of the points.

50:46.55] And so I wanted to share some of that with you and to be clear about the spirit in

50:50.90] which this was offered because CU and the city ultimately are trying to address the

50:55.97] same issues. So on the first point, the original ordinance being intended to

51:00.83] address rates, as we pointed out, that was actually mentioned in the original

51:04.88] ordinance. It stated the focus was land use and zoning and on the substance

51:09.38] protecting customers from rate impacts and other cost allocation issues is exactly

51:14.88] what the large load task force was created to do and has been doing since April

51:18.80] 2025. On second, about cost shifts to customers, CU agrees entirely with the

51:24.71] concern. Our feedback, again, was that CU has been addressing this through our

51:29.45] large load evaluation process and through our work that continues in developing

51:33.80] large load rate.

51:36.32] So the protection that the extension is seeking is already being built regardless

51:40.73] of whether there's a clause or not.

51:43.07] On the third, that all boards, departments, agencies of the cities are subject to

51:47.09] legislative control of the city, that language does...

51:51.86] It's not that interesting, I know.

51:54.56] That language does come from the charter, but City Utilities' feedback was, of

51:58.61] course, we wanted to include the full sentence that appears in the charter, which

52:02.30] adds, "Except as specifically authorized or provided in the charter." So that

52:07.22] qualifier is part of the same provision, and it matters because the charter does

52:11.54] specifically otherwise authorize or provide powers to this board in several areas

52:16.41] that this bill would touch on.

52:19.04] The fourth, that on the fact that a data center outside the city limits could

52:22.85] affect rates and capacity the same as one inside.

52:26.57] City Utilities just notes that CU service outside city limits is governed by the

52:31.13] charter, by state statutes, and by any territorial agreements we have with outside

52:35.30] cities.

52:37.46] So I'd like to close on the substantive portion by just setting out the

52:43.31] roles of the charter signs that are relevant to the purposes of the extension and

52:48.02] how they point toward how we can jointly move forward in addressing data centers.

52:52.88] So some responsibilities, of course, belong to both bodies.

52:57.77] Rates are the clearest example under the charter.

53:00.41] The board fixes rates, and the council approves or rejects them.

53:04.34] Gas and water service rules work the same way.

53:07.07] The board adopts them, the council approves them.

53:10.10] And some responsibilities belong just to council.

53:13.55] So under the charter, the council exercises legislative oversight, except where the

53:18.14] charter gives specific approval otherwise.

53:20.30] And it examines, it can examine utility records and require annual audits.

53:25.07] Some responsibilities belong solely to the board.

53:28.64] So under the charter, this board manages, controls, and operates utilities both

53:32.81] inside and outside the city limits.

53:34.85] It directs improvements and extensions, and it adopts electric service rules.

53:40.04] So that charter framework was the reason for the feedback we provided as to the

53:44.60] extension. It contemplates exactly the shared process that the extension

53:49.97] contemplates as to rates. And the council's ability to protect constituents is

53:54.59] already built into that structure.

53:57.71] So I will end it kind of where I began.

54:00.95] Whether or not this administrative delay is extended, City Utilities has already

54:05.16] put measures in place and will continue to put measures in place to protect all of

54:09.03] our existing customers inside and outside city limits.

54:12.23] That's been true from day one of this task force.

54:15.71] And our commitment is straightforward.

54:17.36] Large loads, including data centers, will pay their own way.

54:21.35] The cost of serving them will not be shifted onto existing customers.

54:24.74] That's always been the standard that we're working toward, and it will continue to

54:28.25] be. So we will continue to keep this board updated as to the proposed extension,

54:33.56] and we'll bring it to the board at large for its work as we continue as it comes to

54:38.12] completion. So Happy to take any questions.

54:41.48] Thank you, Catherine. Are there any questions for Catherine at this time?

54:46.34] What was the feedback to our feedback?

54:50.06] The ones I highlighted were suggestions that were not taken as to the

54:56.00] proposed extension. So those matters were presented to the city but did not

55:02.00] make it into the version that was recommended and presented ultimately.

55:06.59] What does that mean?

55:08.42] So they're going with what they had.

55:10.67] Okay.

55:10.94] They're just going to go with what they had.

55:13.58] They were very clear when they presented that there is still room for suggestion,

55:17.72] there's still room for change.

55:20.54] So they will represent it again, I believe it's on the 26th of November.

55:26.42] So for that meeting, yes, they went with what they had.

55:30.17] They did take other suggestions that we provided. There was back and forth.

55:34.55] But I anticipate they will still want to make some changes to this.

55:43.38] If-- Could you-

55:44.30] No, I'll wait.

55:44.93] You'll wait.

55:45.35] Somebody might ask it better than I will.

55:47.21] Okay. Jerry and then Cliff.

55:51.56] Are you hearing anything from the developer community with respect to decision, in

55:56.93] fact, decision-making process?

55:59.84] Yes.

55:59.99] Whether they come to Springfield or not, or...

56:02.06] Yes. Generally, we have open communications with developers of all kinds.

56:06.71] And so as to this extension, we have heard generally from developers that they're

56:12.68] largely in favor of reasonable regulations.

56:15.78] But this does add uncertainty that affects their decision of whether to locate

56:19.97] Springfield or surrounding areas or other places that there's not as much

56:23.88] uncertainty about what will happen in the next six months to a year.

56:27.05] And, so we are definitely hearing that it's an issue, as well as the thresholds

56:33.05] for large loads. Those are

56:37.91] low thresholds compared to previous commitments.

56:42.29] Cliff.

56:43.64] Were we consulted about the length and scope of an extension, and did we need an

56:49.19] extension to work on anything?

56:52.28] CU did not request an extension, and

56:56.78] we were not asked whether 120 days was something we agreed or did not agree

57:02.72] with. And, the scope,

57:06.47] not so much, other than to be able to review and provide the feedback that we

57:11.18] did.

57:13.70] Heather.

57:14.45] You mentioned that the proposed extension includes the city staff's definition of

57:19.34] data center and proposed classification of sizes.

57:23.27] I'm curious, how do those compare with any definitions or thresholds in CU's large

57:29.27] load process?

57:30.92] Very glad for that question. The city has a few thresholds, and ultimately, their

57:36.17] current proposed thresholds for what is a large load data center is anything five

57:41.60] megawatts or greater, or if there's a floor space of 30,000 square feet, I

57:47.48] believe. So we did have discussions with the city about that and

57:53.54] about the fact that the city told us the large load process begins for

57:59.81] projects that are anticipated to be over five megawatts.

58:03.29] However, that is not the city's definition of what is a large load itself or what

58:08.84] is a large load center. We discussed that when we do eventually bring our large

58:14.75] load to Springfield, it will likely be at a much higher megawatt level, maybe more

58:20.39] closer to 15 or 20 megawatt range, just based on comparison to other

58:26.51] loads plans currently. So that's kind of how that compares.

58:31.82] Well, if they adopt this definition, should that change then what

58:37.67] we're thinking in terms of when the rate kicks in?

58:40.94] I would take the great advice from our rates group on that and how to advise on

58:46.70] that, so.

58:48.68] I do think that it's not necessary for that to happen.

58:52.07] I don't mean to put words in Catherine's mouth, but these ordinances will govern

58:57.02] how the city defines a data center or a large load or both within their zoning

59:02.36] regulations. But we're talking about how to apply rates, so two different things in

59:07.07] terms of land use versus rate designs. Is that fair to say?

59:09.71] Yes. Yeah. Thank you for that.

59:13.76] Hal.

59:14.51] So the language that says, kind of Draconian, "This is what it is,"

59:21.20] and we suggested it,

59:23.75] carving out what the charter says, doesn't change what the charter says.

59:27.05] It just means that they've adopted something, but it doesn't change the charter.

59:31.13] So

59:32.88] really, that changed reality. It changes perception, right?

59:36.47] Eventually, and that's a good way to phrase it.

59:40.16] It takes a vote of the people to change the charter.

59:42.26] So the city council, by its own actions, I don't believe can change either the

59:46.73] language or the interpretation of the charter.

59:49.31] But we want to make sure to provide that feedback because it could come up in other

59:54.05] circumstances as well. So we want to make sure to have as accurate of information

59:57.83] as possible.

59:59.12] Are we providing that feedback in the public hearing?

60:02.60] We did not on Monday, but we might do that in the future.

60:05.48] We have provided directly to city staff.

60:08.72] I just don't want us potentially down the road

60:11.81] there's a conflict and say, "Why didn't you publicly state this?"

60:15.38] Correct.

60:16.01] And so you were acquiescing. Why not

60:20.30] stand him up?

60:20.96] You're right.

60:24.57] Yeah.

60:25.64] Great point. Catherine, on slide 47, you mentioned,

60:33.17] just the last two bullets there.

60:37.38] So I've read and heard, and it touches on that regarding the

60:43.22] city

60:44.81] stating that they are going to have regulations

60:50.51] on both in the city limits and outside the city limits.

60:54.95] And I'm curious how the city can regulate something outside the city limits.

61:01.07] That's part A. The second part then is how does that apply to city utilities when

61:06.98] we serve both customers inside and outside?

61:10.94] Yeah. That's a great question, and I think it's probably good for further

61:15.50] discussion

61:17.66] after today and maybe as it touches on legal issues, jurisdiction maybe

61:23.48] there. But from a high level, I also know that the city's in the process of working

61:28.32] through potential land use code changes and

61:34.07] certainly there are ways for them to approach that.

61:37.04] But, I think that's an open question of how they will approach

61:42.89] that differentiation inside and outside

61:46.28] the city.

61:46.61] Could I take a minute and do a quick explanation on something?

61:49.94] Sure.

61:50.27] Yeah. Yes. Drew.

61:54.11] So this is, I think, on point, but we've studied on time, so hold on.

61:58.88] Real quickly, so the people form the charter. The charter is like our constitution.

62:03.59] So all authority comes from the people to the charter, and then the charter, as I

62:08.33] would say, pours out some powers here, there, there others.

62:11.60] And so one of the things the

62:14.28] city relies on in

62:16.94] their ordinances to say, well, there is a provision in the charter that says that

62:21.38] boards are under the legislative control of the city council.

62:26.33] Except as Catherine pointed out, it says, "Except as otherwise provided in the

62:29.21] charter." And, what seems fairly clear is as otherwise provided in the charter is

62:34.52] our chapter, your chapter. The one that gives specific authority to the

62:40.55] board to do certain things, including basically all authority to run the utilities.

62:45.17] And so, as our attorneys here will know, specific always trumps general.

62:51.17] So the general legislative is trumped by the specific authority given to the board.

62:55.91] So you might hear some city council folks say, "Well, we can do this because we own

63:00.17] you." I don't want to give credit, that's shorthand.

63:03.17] I don't know exactly what people mean by that.

63:05.48] But it wouldn't be true to say the citizens of Springfield own the utility.

63:09.71] It would not be true to say the city council owns the utility.

63:12.32] The citizens have given the city council a lot of authority, but not all authority.

63:17.36] They've given the authority to operate the utility to the board of public

63:20.79] utilities. They have a lot of influence. They appoint all you.

63:23.79] They approve

63:26.39] rates, and they approve budgets, and there's certain things they can do, but they

63:29.63] cannot tell you how to operate the utility.

63:32.09] And so it's a friction point, but it's designed that way.

63:36.26] You can go back and look at the minutes from the original charter.

63:39.05] It's designed that way to keep the utility out of politics.

63:41.99] And by the nature of elected officials being involved in politics, there are

63:47.93] political winds and influences that will influence those opinions and thoughts and

63:51.35] desires. And this board is set up to be exempt from that.

63:55.64] And I think the purpose is, this may be a little more debatable, but I think the

63:59.93] purpose is to keep utility funds operating your utility, making sure it's operating

64:05.36] in a proper and appropriate way, and not be utilized

64:09.92] for other things. I was with Rosa

64:14.27] on TV, and joked a little bit about police and fire are often

64:18.77] entities that will usurp whatever funds the city can give them.

64:22.58] And so it's not unheard of in other places where they take utility funds and divert

64:26.63] them to public safety because everybody loves public safety.

64:29.33] But I think the charter pretty clearly was set up to do that.

64:32.36] That's not to say there's not cooperation and not mutual cooperation, as you all

64:35.90] hopefully are, in your opinions, trying to

64:41.78] follow the council's direction, but it's your opportunity to create those boards.

64:45.56] So,

64:47.66] the charter gives authority to the City of Springfield within the City of

64:50.81] Springfield's city limits.

64:52.94] The city council has no authority outside

64:56.84] the city. The county has zoning authority outside city limits.

65:02.06] And I think this whole issue is a little bit red herring because I don't think

65:04.97] there's any way the county is going to approve of PUDs anywhere in the near future.

65:09.56] So this is probably a

65:11.66] debate that may mean nothing, but in the end,

65:16.82] the city council, because they cannot directly tell you how to operate the utility,

65:22.31] I'm not sure, and I'll leave this open for debate as we're on the broadcast, but it

65:27.05] doesn't appear likely to me that they have the authority to tell you what to do

65:30.98] outside the city limits. They have plenary authority, all kinds of authority to

65:36.05] zone, and nuisance and take care of anything that happens inside the city limits,

65:41.09] which is a little bit of a curiosity to me as to why they even bother with the

65:43.88] great stuff, because they have all the authority they need in just dealing with

65:48.17] zoning and nuisance issues. So they can take care of any issue they have inside

65:51.80] the city limits. Outside, they don't have the authority.

65:55.52] On the other hand, I think we can resolve things.

66:00.80] So that's probably all the things Catherine was saying.

66:02.30] She probably talking about closed session, but said no, so I'm going to.

66:06.14] I appreciate that. Yeah. Jerry.

66:09.08] Just more confident. You much more eloquently expressed the fear or concern that I

66:14.63] have, that this one particular issue is maybe a tip of the iceberg.

66:19.28] An attempt to broaden that. That this is being used as an

66:25.19] opportunity to expand that, and some for other things, not just data centers or

66:30.29] large loads or something.

66:32.78] That's the concern that I've got, that it's an avenue to expand that

66:39.05] footprint.

66:41.51] I wouldn't say control necessarily, but maybe that is the best word.

66:45.38] That's the concern I've got that this is

66:49.07] an issue, but it's bigger than that to some people that

66:53.87] it's an opportunity. So that's just a concern that I've got.

66:57.20] Yeah. And clearly that same concern is one of the reasons behind our

67:02.78] presentation. One of the things we wanted to open for discussion now and later.

67:07.16] You remind me of another point I failed to make a minute ago, but

67:12.05] we did request, we would suggest that this administrative pause would go on as

67:17.96] to land use development without the need to include city utilities in it.

67:24.08] Most everything that city utilities would be part of leading up to the completion

67:29.93] of that code would be non-binding.

67:32.51] So for instance, Southwest Power Pool has a lot of studies that they have built in

67:38.12] time it takes. It takes 60, 90, 180 days to finish some of those studies.

67:42.83] Those are all non-binding. All they do is provide information about if

67:48.77] a large load by their standards comes to them, says, "Here's where I'm going to

67:52.97] locate, connect."

67:55.43] Southwest Power Pool will do a study to figure out how does it impact the system,

67:59.87] what would need to be built infrastructure-wise to prevent it from negatively

68:03.44] impacting system reliability.

68:06.23] We could continue all those studies without making any promise or commitment to the

68:11.15] developer that their project can go forward.

68:13.82] And as an added benefit, doing that might provide us more information about how

68:19.04] these large loads would affect our system that we're not going to get otherwise.

68:22.82] Because SPP will not be doing those studies because we can't apply those studies.

68:27.23] So there's something of a missed opportunity there.

68:30.26] One other point on the county, if we could.

68:33.41] One of the

68:35.51] general rules is that as an electric utility provider, if someone locates in your

68:41.06] service territory and can comply with all the rules, then we have to serve them.

68:44.87] So it's advantageous to be inside the city limits because the city limits can set

68:50.78] those requirements. In the county,

68:56.63] it's harder because they could locate there, and there's fewer rules and

68:59.48] regulations currently. And so we may end up having to serve them.

69:03.08] So then we have a conflict between our obligation under the law and what the city

69:06.05] council has told us to do. So hopefully that'll be resolved either by the county

69:10.22] adopting it or

69:13.64] . I should throw out, I do think obviously council folks are working in good faith

69:17.42] and their best interest to try to help the community too.

69:19.49] So I don't think it's anything. I think it's just a question of interpretation

69:23.15] moving forward.

69:25.64] Ryan.

69:26.18] Just to what Jerry was talking about, if this were a tip of the iceberg thing, I'd

69:31.19] be concerned as well. I don't really think this issue

69:37.13] is way bigger than us.

69:40.76] Just look at the political ads that we're seeing now.

69:45.38] Everybody is trying to demonize data centers and tie the opponent to that.

69:50.75] It's coming up in pop culture. Everywhere is trying to

69:56.66] figure out how we're going to deal with this issue, and it does not seem to have a

69:59.66] lot of popularity right now.

70:02.57] The city's trying their best to deal with it.

70:05.93] From a purely economic development standpoint, I don't think this delay makes any

70:10.46] sense. We should come up with a plan and try to execute it.

70:14.21] But I really don't think that this is some kind of hidden, like, "Oh, we're going

70:19.91] to take advantage of this data center" discussion to try to exercise more control

70:25.25] over the utility.

70:27.71] I'd look at it, that was Dwayne a minute ago.

70:31.73] Why is megawatt a measure for zoning?

70:35.60] Really, those are two really unrelated items.

70:40.31] Square footage might be a good measure for zoning.

70:44.84] They're just trying to figure this out in a rapidly changing world in a heck of a

70:49.64] mess. So,

70:52.79] Catherine, I appreciate what you just said, and I think it's what should give us as

70:57.56] a utility a little bit of calm in all this is we can still continue to

71:03.26] help evaluate in a very logical sort of way, is this

71:09.68] data center that's being proposed by the private sector a reasonable thing for our

71:14.87] utility, and net positive for utility in our community?

71:19.19] And if we can continue to evaluate that,

71:23.06] that'll figure it out.

71:26.00] And Marshall. So yeah, and exactly to what you said, Ryan.

71:30.59] I said it at least once, and it bears repeating.

71:33.35] We are all trying to address the same issues.

71:35.33] The city staff, the city council, everyone in this room.

71:39.47] We all see the same thing and want the same protections and want the same ability

71:44.09] for Springfield to grow. So yeah, it is just a matter of how we are doing it, how

71:48.62] we went about it.

71:50.78] I do appreciate the comments about clarifying the tip of the iceberg issue, and we

71:55.19] will communicate with city staff on that to try to resolve that as soon as

71:59.51] possible.

72:03.65] Steve, a question?

72:05.48] Yes. Some of my concern is, of course, here at City Utilities, we want to make

72:11.27] sure that

72:13.10] we're

72:14.78] giving the customer the best rate possible. When does it get out of control?

72:19.76] Because with SPP, if they build data centers somewhere else in that

72:25.70] footprint, it's like I asked Amy earlier, that market price is dictated not

72:31.43] by just what we're using in Springfield, it's the entire footprint.

72:37.13] And so,

72:39.65] I understand the

72:42.02] desire to tell people that we're going to try to make sure data centers don't

72:47.90] impact their rate, but we don't have control.

72:52.91] Of the entire SPP or the entire grid that we are service out of

72:57.26] That's absolutely right. We will do the best.

72:59.84] We can't do those things that are inside our power, like rates.

73:02.84] But yeah, there's a greater region there that we are part of.

73:05.90] There's a greater country that we are part of.

73:08.12] Right.

73:08.66] Certainly anything that happens out there could affect us even indirectly as well.

73:14.54] And so, not only market prices, wholesale energy prices, but cost.

73:20.48] There's a number of different ways, and some of those things just simply are

73:23.75] outside of our control. It would be out of any utility's control.

73:27.44] But for every control we have, we will be using it.

73:31.37] Okay.

73:32.03] I would also add to that, besides rate pressures, there's also increased cost for

73:37.04] labor, materials, all sorts of things that go into constructing data centers and

73:40.34] servicing them. And so without the corresponding benefits of having a data center

73:44.12] within our footprint, we're paying for those costs without any benefit.

73:48.62] That's a related benefit that can offset those.

73:51.74] Do we use the same scrutiny for manufacturing,

73:57.20] education, retail when it comes to

74:01.28] them setting up their organizations or their businesses here in Springfield?

74:05.36] Do we publicly say, "Well, you're using five megawatts," or whatnot to compare what

74:11.21] a data center is, or, "You're using this much water and this is what a golf course

74:16.13] uses." Are we doing any of that just to educate our constituents as far

74:22.01] as what a data center could possibly mean to the area?

74:27.77] Specific to educating, I don't think that we have tried to make those comparisons.

74:32.03] It would be very hard to compare

74:36.89] large customers currently on our system to a data center because they are also very

74:41.33] different. But to the scrutiny issue, the rates folks can interrupt me,

74:47.39] but we're not really looking at what is the business creating, what is the business

74:51.89] doing. We're looking at usage. And so whether it's a widget factory or a hospital

74:57.26] or a school, that's not really within what we're concerned about when we set out

75:01.19] customer classes. So the similar issue is kind of true here.

75:05.87] We certainly care how much they use, but it's more about that than what they are

75:09.86] creating.

75:10.97] Thank you.

75:11.63] Thank you.

75:12.17] Good discussion. Good questions.

75:13.64] Thank you, Catherine, for your presentation and update.

75:16.07] We look forward to hearing more as things progress.

75:19.10] I'm going to move us along here. Do any board members have business that may

75:24.26] properly come before the board?

75:27.77] Do any board members have any announcements for the board to hear?

75:32.69] Okay. This concludes our regular business portion of the meeting, and we'll take a

75:37.46] 10-minute break before beginning our retreat portion.