Transportation Board - Regular Meeting

Good evening folks. I call to order this July 22nd, 2026 meeting of the Board of Public Utilities. Thank everyone for being here. We have two voting board members here in the room and we have two more online. Let's verify they can hear us and we can hear them.

Jennifer and Matt, can you hear us okay still? Yes, sounds good.

Yes, I can hear you.

Great. I can hear both of you. Thank you much for being here at this rather ridiculous hour for you folks. Okay. I don't see anyone that's Time for public comment. I don't see anyone here in chambers for public comment. Do you have anybody online for public comment?

There is one person online. I'm not sure if they want public comment, but we will ask. Thank you, Chair Gibson. For members of the public who are joining us tonight on Zoom, when Chair Gibson calls for public comment, please use the raise hand function. If you're participating by phone, please press star nine to raise your hand. If you wish to make a public comment at this time, raise your hand on Zoom.

for clarity ask you if they want to make any comment on either of the rate hearings because those are going to be later this evening than They might want to stay just to make sure. Okay.

If the caller who is the phone would like to make any comment regarding the rate hearings, it is going to be a little bit later than anticipated. They did raise their hand.

Okay. We're willing to take public comment on the rate issues now so they don't have to wait all evening. We're going to not hear a water rate hearing tonight. That's going to be postponed for probably a month. We'll take public comment on that also so people don't have to come back.

Let me get the timer up real quick.

We'll take the public comment during the hearings also, but for convenience, if they would like to comment now, they're welcome to do so.

Right caller you have been asked to unmute and you can make your comment Oh, please state your name letting me Get them unmuted I I've asked them so I think it's on their end. Oh

uh let's see star six is to unmute yourself good evening yes we hear you oh great my name is joni aaron and i'm with concerned citizens for nuclear safety i'm calling to um listen to the presentation about the eca I don't plan to make any comments on the electricity or the water bill this evening. But thank you for facilitating my participation.

We will take public comment on the ECA during that agenda item also, which will be coming up shortly. Thank you. That's all we have for interest at this point. Okay. Takes us to approval of the agenda and there is I Miss a statement regarding the closed session Charlie

I move that the Board of Public Utilities approve the following statement for inclusion in the minutes. The matters discussed in the closed sessions on June 17th, 2026 were limited only to those topics specified in the notice of the closed session and no action was taken on any matter during the closed session.

I second.

Okay. Moved and seconded. Any discussion? I will consider this procedural. All in favor? And up here, I see a thumbs up from Matt and Jennifer.

Yeah.

Thank you. OK. Motion passes 4 to 0. All right. Thank you for catching that, Charlie. Now we'll go to the proposed public hearing on the proposed amendment, the proposed ordinance on the water rate hearing has some procedural issues, not substantive really, but procedural issues, and I think it would be the cleanest just to start all over again and introduce the ordinance at the next meeting and then here again a month from now. It would still be effective if it passes at the same time that was previously proposed, with one little exception, which would be the first of October. Item to remove that item item 70 tonight are there any other? None Certainly, can I rely on you to make a motion here?

Sure, you can. I move that the Board of Public Utilities, oh, this is the consent agenda. Do we have that? By the way, sorry, procedural question. I just emailed this whole thing on the water. We don't need that. Okay.

We don't need that. I'm sorry. Just a motion to approve the agenda as amended. I'm sorry.

No worries. I move that we approve tonight's agenda as amended. Okay.

i'll second that for convenience i need discussion okay uh that's procedural also all in favor uh i see matt and jennifer motion passes four to zero now agenda

I move that the Board of Public Utilities approve the items on the consent as presented and that the motions and the staff reports be included in the middle for the record. Second.

We need a roll call for it.

Roll call for consent? Yes. Member Nockley? Yes. Member Gibson? Yes. Member Hollingsworth? Yes.

Yes. Okay, motion passes 4-0. Thank you, everyone. Now we will move to Department of Business with the electric coordination agreement, which starts on page 77 of our agenda doc. And we will... ILO, did you want to start that one?

Yes, Chair and members of the board. Ben, you can hear it from here. We don't have a regular microphone. It's all in the ceiling. All right. We learned today that a termination clause needs revision. And so what I would like to do is have the full presentation that we plan with including the addressing the questions and comments we had from the board. And then in the packet, we have an alternative motion that will work. And we have been in touch with the DOE saying that's what we would request. And requested that a couple of weeks ago. They're running through their process. We'll know for sure by noon tomorrow. But I think it's safe to assume that we we'll get that month extension. So with that, I was going to have Ben do kind of the overview of the presentation. Seth Kirshenberg will pick up some elements of the presentation from within here. And then we have the review of the board comments towards the end before the utilities manager's recommendation.

OK. We basically would wind up now treating this as like a work session discussion. Try to get as much...

Essentially, yes, except for the motion to get another month's sentence.

Get as much discussion and understanding, briefing, discussion, understanding as we can tonight before it comes back again. But it'll also give people a little time to let it sink in a little bit more. Okay, thank you. Yeah, thanks for working that out.

Ben Ulbrich, Deputy Utilities Manager for Power Supply. Thanks for having me here. I would like to say Seth is, I may ask him to step in at any point. There are some slides in particular that I'll ask him to address. And other than that, the other thing I want to mention is feel free to ask questions as they come to mind. I think that's the most efficient way of handling it so that we don't really wait until the last minute at the end. All right, let's go across the presentation. Next slide, please. Purposes of this presentation is to describe the ETA, what it is, what the goals of it are, explain how it's structured, provide an overview of how costs and payments are handled, to discuss the termination contract provisions and staff recommendations summary and next steps.

All right, please.

To the next file.

We're done.

She wants to get out of here. All right, what's going on with the slide there? Okay, thank you. So answer the question, what is the ECA? So we have an ECA now, Electric Coordination Agreement. It's an agreement between the Department of Energy and Los Alamos County. It started off, I believe, on July 1st, 1985. So it's been going for, we were planning on having this go for 40 years. Extended it out for an additional year and a month now, and now it's going to become hopefully a year and two months. That's where we're at. It's authorized pursuant to the Department of Energy Organization Act Public Law 9591 and other applicable law. Lawyers speak here, so I apologize for just reading it out. Including the Atomic Energy Act of 1954 as amended to provide or otherwise arrange for utility facilities and services. That's exactly what it does. It has two parties, the county and the DOE NSA. which operates the Solomons National Laboratory. The ECA is for the county to sell electric utility services to the DOE and NSA. And this new one we're looking at is, we'll kick on after the, what I'm gonna call the 1985 ECA or old ECA, which says it expired on June 30th, but actually it would have been July 31st, but now hopefully it'll be August 31st, 2026.

I have a question for you on this. Your first line says it's a collaborative agreement. That's a legal form. This is not a collaborative agreement.

It's not a collaborative agreement, you're correct, in the sense that a collaborative agreement is some kind of doctor and staff relationship agreement contract. That doesn't apply here. What I meant in the sense was it's collaboration between the two parties to manage the electrical system for the cost effectiveness and the needs of all parties. So this may be a question for Seth.

We got some word that, oh, they couldn't do a collaborative agreement here. But the county does collaborative agreement with AOA for the fire department. Why can't we do one? Because I've always viewed this as a partnership. But the way this is structured is absolutely not. And I think a collaborative agreement would be, to a layman, sounds like a more accurate way to structure this. Why can't this be a collaborative agreement?

And so with the fire department, the authority is under a different process, and they use what's called actually a cooperative agreement for the fire department, and it's similar. It's almost like a grant, but it's the way that local governments and municipalities or governments and governments federal government and nonprofits work together on a particular project, and that's what they do with the fire cooperative agreement. Here, when the federal government's purchasing utilities, the authorities are a little bit different than they are with providing things like fire services. And so there's certain requirements when providing utilities to the federal government. And we'll get into it a little bit more, like the limitation on the 10-year. You know, we have a 10 plus 10 contract, and there are some other things. But, you know, as everything else, it's unique federal authorities, I think, is the quick answer.

Okay.

I guess I don't fully understand the details, but we'll consider that output for the time being. Thank you.

Thank you, Ben and Seth. Next slide, please. ECA goals. So overarching goals for the ECA is that the reality is our electrical systems between county and DOE are intertwined. And we'll discuss that in sort of a diagram that shows the actual physical high-level flow of energy all the way from the outside generation into the crowning. And it's a convoluted path, and it's not what you would expect from an average utility. It truly is special. That's why we have an ECA that respects that specialness and addresses the considerations that go along with that. So we have shared infrastructure and shared generation resources. They don't fit with what people typically associate with utility and utility customers. So the ECA is a contract that allows both parties to combine these resources and account for them financially in a manner that doesn't add a whole lot of burdensome overhead. It doesn't build in a lot of unnecessary process. It's just clean and efficient as far as we recognize. The goal is to achieve economic dispatch, which means getting power for the lowest cost that we can. meeting our other requirements for those power supplies such as our carbon 2040 carbon neutral goal and maximize our reliability of electric supply. So with the coming in to the 1985 ECA we had a 2026 ECA ready to take its place until we found this termination issue. Next slide please. What happened there? So there are four sections to the contract package. Contract, I've got to read the number. Terms and conditions.

Didn't we miss one here, Ben?

What's that? We changed a few pages around. Yeah, you should have.

You should have gotten a... It's still in there. Yeah, I've got the new one here, and that's a different order than the old one.

Okay. SLIDE 5 DID MOVE. THE ORIGINAL SLIDE 5 MOVED TO, LIKE, SLIDE 11. AS LONG AS WE GOT ALL THE INFORMATION SOMEWHERE. WE JUST MOVED SOME THINGS. AND THEN WE ADDED A WHOLE BUNCH MORE. NEXT SECTION OF IT DOCUMENT IS THE ECA PERFORMANCE WORK STATEMENT, FOLLOWED BY THE ECA OPERATING PROCEDURES, AND THEN A MANDATORY DOCUMENT THAT'S ENTIRELY DOE LANL, WHICH IS THEIR EXHIBIT G PHYSICAL SECURITY LAB-WIDE CHECKLIST. Real briefly, I'm not gonna go over each of these sections. If you see something that catches your eye, feel free to ask a question, speak up about it. Terms and condition is what the federal government calls a standard form 26 for contract award. So when we're talking about this whole process, at this point, the documents that have been provided to us are contract award documents. The DOE says, we're done, here you go, sign it. So at this point, it's not a contract negotiation. We're past that point, although I said the contract termination. We're not past that point. So we'll get another stab at this. Here's the sections, a whole bunch of sections, A through J, defines all these things. Most of them aren't specific to this contract in the sense that the next section, next slide, please. performance work statement is very specific to this contract, and it describes the services and supplies that are going to be provided, what they'll cost, and how the cost accounting is handled for all of these things, and a whole bunch of other things. Lots of items here, all the way through, starting from Section B through C, H, and a number of attachments that describe all the EC refers to as approved resources and other resources. Next slide, please. The third piece of the package is the operating procedures. It describes how day-to-day planning for power operations, resource scheduling, and other operational tasks are performed. These procedures are broken out separately from the rest of the document from the performance work statement. to make them easier to manage and maintain and update. These are the ones that are changing most often. Typically, we look at them and revise them as needed, or at least on a recurring schedule of a minimum of, I think, of five years or maybe less. Next slide, please. Again, more operating procedures. Next slide. And here's that mandatory reporting requirements checklist, and it'll exhibit gene physical security. Some people may be familiar with this, having worked at the lab. It's a reporting requirements checklist and it's required for the DOE and NSA and they have to do it in association with this ECA. The responsible party for performing it is the DOE. It's not something that the county has to fill out. It defines the DOE and NSA's comprehensive physical, personnel, cyber, and other information security requirements for subcontractors performing work for Los Alamos National Laboratory. So it does impose on the county certain requirements for things such as you need to be able to pass a random drug test. You have to meet their security requirements and personnel requirements and Just a little of other things, most of which I'm confident that the county already does. So we'll have to make sure that every one of those requirements we are capable of meeting. That's something we're prepared to do.

Next slide, please. One more moment, please. Sir? You say under the first one there, the reporting requirements checklist, responsible is DOE. Fine. To fill out the checklist, there's a whole bunch of reports and stuff that apparently are required there. That looks, I presume those are filled out by the county.

In part, I don't believe we necessarily need to submit reports. My understanding could be wrong. And whatever I need to do, I will do as part of this. However, I think it's of us, we can alternatively demonstrate in many cases that we have the processes internal to the county that are necessary to meet these requirements.

Well, that's good news. My concern is if you're filling, if the county is generating reports for DOE's benefit, not for our customer's benefit, but for DOE's benefit, are those, the time and effort to generate those, are those charged to the pool, which means our customers pay a fair share of it? Or are they charged to DOE because they're the only benefit? I don't believe those are specifically called out for

unique constagoning method. However, that's something that could be put in if it needed to be.

There are provisions in here for items that benefit only one person. It would seem like that would be an item, at least in most cases here, that would only benefit DOE.

Although I will say it depends on the level of burden, right? If this is not a burdensome requirement and it fits in with my normal staff work, that's not something I'd necessarily raise as an issue. Now, if it becomes, like I say, burdensome, then it's something we'd address. There are many functions that I provide that only benefit one part or the other in my role as operating manager that I don't bother breaking out just because I get paid the same either way and those things tend to balance out.

As long as they balance, I'm okay with that. When you look at this list, say, gee, that's a lot of reports that have to be generated. If it isn't that many reports and they're not big, then I'm less concerned. Thank you.

We're up to the 2026 DCA contract structure. So we went over the...

Sorry, Ben. I had my hand up for a bit. I just wanted to follow up with the chairs.

We just lost you.

Sorry, I just wanted to follow up on the chairs original question regarding whether this should be considered a partnership. And a collaboration, and you know so so again it's highlighted in the last slide that you just showed it does not feel like a partnership, and so you know just reminding you that you're going to. have to address that issue going forward in this presentation. In addition to the issue of burden that's one-sided, this is a direct issue related to the question of whether this is a partnership or something else. And I'm hoping you'll continue to address that.

All right. Thank you. So as Seth mentioned in his earlier discussion, when he was talking about why we have the contract structure we do, this is a fixed price contract with a cost sharing arrangement. Because as far as we're aware, it's the only suitable and applicable contract structure for what we're doing. Nothing else. When we tried our best to go and look for all the alternatives, you know, cooperative agreement, anything else we could identify with that worked within the federal contracting framework, and this is the one that comes up. Nothing else. There are no other options than, say, partnership or anything like that. So that's why when we were structuring and working on the document language, we tried to build in much of that spirit of partnership into the language itself. Never mind what type of contract it is. So it does combine a fixed price for utilities with a cost-sharing component. That's the key part, the cost-sharing component. That details how DOE can count each bare portion of the total costs. There's many details in the document, and I can get into the nitty-gritty if anybody wants to. One of the things that we took a particular good look at with how we are going to manage cost risk of future unknowns. Under this agreement, things that may not have been an issue with the current ECA, but given what we know about the current market situation for power supply and where things may go that we don't know about, we recognize that there is potential for real financial risks to the county for the sorts of things that we're going to do under this contract. financial, real financial impacts if things go sideways. So we have filled in mitigation approaches within this language. One of them is the changes clause under which adjustments are made through a lot of modification, formally amending the contract. And as you know, we've done 27 modifications to the contract over the past 40 years. A lot of them were small ones and the other ones wrapped up a whole lot of changes together into one big package. 27 changes over 40 years, so we've demonstrated that the DO is a willing, the county is a willing partner in coming up with a mutually agreeable solution for any issues that have arisen in the past. And we believe that will be a path forward in the future. There are also avenue for administrative modifications. That's for things that don't impact the contract's price, cost-sharing obligations, scope of work, or fundamental rights of either party, such as refinements or additions or removal of operating procedures. That's part of the reason why the operating procedures are broken out in a separate section is to make that easier to handle. The 2026 ECA is for a 10-year period with an additional 10-year option. with a total contract value for the first 10 years of $424 million. I will ask Seth in a little bit here to explain why we went with the 10-year structure, but I will say we did get asked the question, and we'll go over this again in another place, about where's the costs for the second 10-year option. They don't show up in here. We asked the question to DOE, and the way it works is we have this one contract. with its long 15-digit number naming convention. And there are two contract line item numbers under that agreement. One is for the first 10 years, and the second one is for the second 10-year option. Because the second 10-year option is at the government's desire and discretion, that's not part of this contract award. It would be a separate award under the same contract if they choose to exercise that option. Now Seth, can you contribute anything there added about the tenure and tenure option?

Yes. So the federal government, they have a limitation to have a 10-year utility contract. And so that's why the 10 years is the limitation. They have a unilateral right under this contract for an additional 10 years. And every contract extension if you're going to have a contract sent to the federal government if they're limited in time then it has to be at the at the government's option uh we we talked for a while about bilateral versus unilateral uh approval for those different the second 10 years but we thought because the way the structure works that the um unilateral uh was fine so there so it has the 10 plus 10. we originally asked for the 10 plus 10 because we wanted to look at long-term investments under this particular contract so we looked at that i will say so um just one other issue is that that Most utilities in the United States who sell power to the federal government do so under what's called an area-wide contract. And it's a general contract that basically identifies whether there's a fixed price or there's a variable price set by the regulatory body. your structure is so different because DOE owns some of the resources. You own some of the resources. There's a management of resources throughout. There's been this cost sharing. And so that's why this is the contract structure that we ended up with. And going back to the partnership question, You know, I always joke around that a partnership agreement is still a contract between two partners. And you know, the federal government, the only way it does business is under a contract. So even a cooperative agreement is really a contract. um and so you know we're operating under a contract here and you know uh to date the group that we've been working with has acted in very good faith uh and has tried to work out things that's why we're still working up this one issue on determination for convenience and i think that you know uh that's the partnership i think that you all have had for the last 40 plus years with the department on these issues as well there's always ups and downs in a partnership but there's you know it's still working together to try and solve uh these these long-term issues and the importance of having um you know consistent power for uh you know the lab and for the county has is always a key

Nobody else has questions here. Seth, the You say that the option for a second 10 years is someplace, but we don't see it here. How do we know it really exists? How do we know it would exist in 10 years when anybody would find it? Or that the rules wouldn't change in 10 years? And they say, oh, we can't do that anymore. It seems to me if it's not here, we can't count on it. And the only thing that's here about extending contractors, that one provision that they can do it in 30 days notice, which is, of course, absurd. There was a provision at one time in the negotiation which was explicit and actually gave a three-year lead time, which in our experience here is barely enough and may not be enough. But why can't we have some explicit, that provision or something like it back in here so it can be seen because what you're describing is invisible, meaning to me it's not in the contract. That to me is a major concern. We don't want to go through this again and if we don't have to, I mean obviously people have options, but would you like this to not have to be redone again in 10 years given how painful this has been?

So they do have the clause. It's on page 20 of the contract, 52 to 17-9. Now I get to sound like a federal government contract lawyer when I throw out numbers like that. But it does talk about the government has the right to extend the contract, as you said, with a 30 days notice. The practice, though, is way before that, the parties are usually getting together to talk about these issues and whether there's going to be an extension. The county's going to want to know a couple years in advance. DOE can do it much farther in advance. And we can agree to do it much farther in advance, but they're using a federal acquisition regulation provision. That's why we ended up with the 30 days versus what you had seen before was something that we had written that was a bilateral right and took into account the idea of people working together towards that goal as we were moving forward.

I guess I still don't understand why something like that can't be in here, rather than essentially open as it is or giving government the option to extend it with 30 days' notice, which is crazy. We might be nice to each other and talk about it ahead of time, but why can't we put it in here in black and white?

I mean, that's what we asked for, but, you know, in the end, this FAR provision, the Federal Opposition Regulation provision is what we ended up with.

Well, that's been in here all along, but then there was that other provision that was more, and that referred to some other FAR. I've forgotten now what it was, but the...

Yeah, Ben and I talked to them about it last week. So, yeah, we, you know, that is something that we were, you know, until last week we were focused on the same thing you are.

Well, I'm still focused on it. To me, it's a serious issue in terms of ultimately approving this thing. Like I said, I don't want our successors to have to be doing this again.

I'll let Philo or Ben jump in, but I think the idea was the balance of the two, which is at least having that option. So that way you wouldn't have to go through this process again in 10 years. And Philo or Ben, I don't know if you want to add anything.

Yeah, the only thing I'll say is my understanding of the discussions, my recollection of the discussions we had with DOE contracting audit staff is that this is the way they structure it. They have limitations on the changes they can make to the clauses within their terms and conditions. They don't have the potential to go and just make any change they want, even if it may be warranted from the whole party's perspective. So they're constrained on what they can do. And I believe this is one of those instances where this was the best they could do given the traits they're working with. That's my recollection of that. I will say that what Seth mentioned is absolutely true. We work all these things. We've been working on this agreement for coming on four years now. The option, 10-year option shouldn't take nearly as long, but we still anticipate it taking years to get through potentially, especially if they choose not to exercise the option. So that's why we are well aware of this need that will be in place within, say, seven years, and we'll be actively working it. It won't just slip under there. We're aware of it, and we'll monitor it and manage it as needed to ensure that it's done in a timely fashion. And that's well within our opportunities space that we have under this contract to start early and get it done soon.

And what can wait in contract makes me a lot more comfortable than good intentions on one side Okay, the only other thing I'll offer is Yesterday we were trying to hash out a few more details regarding termination and then we bring up again the ten plus ten issue You know we responded about having a separate clean one and two He actually showed us that two is in their system with the correct dollar amount, but can it be deleted? Sure, but their intention is to do the 10 plus 10.

Frankly, I don't trust their intentions at all.

I will speak another bit about the partnership. A big part of our work is the operating committee. Ben is the operation manager, and I'm the voting member on the committee, and Cassandra McGay at the NSA is the other voting member. And when we talk about partnerships, Cassandra and I both have to agree to advance something. If one of us doesn't agree, it doesn't advance. And just taking the language straight from the last paragraph on page two of the Attachment D it says in the case of a disagreement party shall work together until such disagreement is resolved and That's that is how we've been working So I think from a partnership point of view we we have quite a bit of because we manage the majority of the generation assets, and we'll get into that in a little bit on that piece.

And that part seems to work quite well, the operating committee, operating agreement. I like the fact that basically both parties agree. We have the chair, although that's not a voting member board. Chairs can set agendas and things of that variety to help. But the operating committee can't change the provisions of the contract. And the duration of the contract, extensions, et cetera, that's contract. That's not operating committee.

I'm glad the operating committee works as well as it does for the business itself. You recommend amendments through this. It boils up.

What he's saying is, no changes to the contract can be made without the operating committee. Proving them, that's a necessary step. And any changes done to the contract will be going through by the operating committee.

Which is helpful, but that still doesn't.

I think we take a take a step back. Also, you know, the way I look at it is. You can have just a 10 year contract. And then, you know, a couple of years beforehand, we can all sit down again and then decide that you want to use that same form or not. and then move forward. This gives you something a little bit more to have the 10 plus 10, but it really is right up to you. If you want to just have 10, because that's their other options, just to have the 10, because they can't go beyond that. They can't commit to it. So that's the way I kind of look at these options. In three buckets, the 10 years, that's it, the 10 plus 10 with the unilateral, and then we tried for 10 plus 10 with a bilateral but um you know they they wouldn't accept that so in the end we ended up with a choice of just 10 years or 10 years with a unilateral with a unilateral 10-year option so i'll make one more comment or two more comments in this right now the original agreement was for 30 years uh and it was extended for 10 more the uh

who knows in ten years or seven years they might say oh we can't do ten years anymore we can only do five or they make other changes and we're stuck. This remains quite a serious concern of mine. I consider this a potential showstopper if we can't get something That gives us some reasonable chance of being able to extend it. I recognize to you we can say we don't want to. We can say we don't want to. But I'd sure like to see something stronger in here than this rather obscure provision that gives us 30 days notice. Thank you, Ben.

Next slide, please. Over here, this is a high-level overview. There are a lot of details built into the performance work statement and the operating procedures about how resource costs and payments are handled. But real high-level, a portion of the costs are fixed, such as investment, resources, and others are variable, transmission, administrative expenses for various parties, memberships and participation in markets. Those things change. The county trues up monthly, costs monthly in arrears, so we fix it after the fact, update in the following month. The county and NSA contract is focused on a rate that is set based on actual cost of the parties. So it's not a regulatory rate where we say this is the fixed cost of utility service. We look at the actual cost incurred by both parties for each month, add those up together, see what each party contributed in actual expenditures for each of those months, give them credit for that, take the difference and allocate it to the two parties based upon certain energy and demand allocation factors that are all described in great detail within the document.

Any questions there? One, Ben. These fixed costs, those are just fixed costs that each party pays in for their resources. There's no fixed cost that goes into the dollars that go into the pool. Is that correct?

I've got to think about that because I'm not quite sure I understand the question.

Well, we put all the power in the pool. We pay proportionately for what we use.

doesn't include any fixed amount I don't believe in that basic understanding it actually does there are different types of costs I'm going to give an example of depreciation we pay for depreciation of a capital asset and that's proportional to the energy used during the month but that's a fixed cost that's split up okay

All right, thank you. And there are other examples, Joe. Do the cost arrangements in this new contract differ substantially from the cost arrangements that we have undertaken for the last 40 years?

For the most part, no. There's been some cleanup. There were old provisions in the current DCA for handling a lot of costs, mainly for San Juan Generating Station, about how those costs were accounted for. Now the San Juan Generating Station has been decommissioned, closed down. a lot of those factors went away. So we cleaned it up to represent what we're actually doing today. If something new comes along and requires additional changes, those will be added in as necessary. So that's changed somewhat. The basic structure is the same, but those particular factors have been cleaned up to represent what we're actually doing today. And we did add one significant piece, and I'm not sure that comes up in a few more slides, about how we handle costs of our power compared to what market prices are looking at and how those are treated. So we'll get into that in more detail when we get to that slide. Anyone online? Not seeing any hands. Let's move on then. Key terms, I won't read off of all of these, but I will say that these terms are used throughout the document, approved resources, resource accounting pool, resource planning horizon. So the short term capacity resources and special purpose approved resources, but they all go into defining what these different resources are and how they're treated on an accounting basis. Next slide please. So pooling of resources. Part of the partnership is each of the parties has a bunch of different resources, transmission, distribution, switching and substations, their own distribution systems, metering, generating resources. The lab has their combustion gas turbine generator. That's their big one. The county has PPAs. We have the River Station coal fire plant. We have our one megawatt at the landfill. All those things get pooled together into a pool of approved resources. The county and the DOE and NSA agree to give notice to one another of meetings or proceedings with third parties involving matters that could significantly alter established resource accounting pool cost responsibilities. All that says is we're in constant communication about any changes we need to make to how we handle costs. They don't generally arise, but there are specific instances when a new resource could pop up. In particular, the new transmission line, the third transmission line, which DOE is in the process of constructing right now, has its own special accounting practice for it because it's still being built. We don't know what it's going to cost. We don't understand what the appropriate cost share yet is for the county. That's something we'll develop, and through the operating committee, establish new, if necessary, cost counting procedure just for that resource, if necessary, or whether it should just be treated like all the other resources in the pool. Something needs to be developed. We're aware of that. It's specifically called out in the ECA about how we handle resources.

That one.

There's another fourth transmission line they've still got in their future plans. As well as the county has a potential for a Eastgate substation that we may or may not build as time requires it to supply additional load from electrification in the county. The operating committee, like I said, we go through our planning process the same as we do for the county for a budget. We do it to inform a budget for the power pool. That's all defined in the ECA. We decide what's most important and what resources we need in order to meet all our objectives. One of those objectives is the 2040 carbon neutral goal, which is why we signed up for Foxdale Flats. And then there's a continuity of service piece to it with excusable delays built into that. We don't generally run into that, so I'm not gonna say more about that unless there's questions.

Do the county and NNSA also harmonize and coordinate things like maintenance plans for the various resources through the operating committee, that sort of thing?

Absolutely. So one example is for Elvato. We've got those repairs that go down to the dam. So all of that is coordinated and planned for what the resource scheduling is, where there'll be any cost impacts to the county and the pool. Another one is for the combustion gas turbine generator. We don't pay for the cost of maintenance. That's entirely... do a little thing, but we do coordinate with them about resource scheduling and planning to make sure that that's a 20 megawatt plus resource. If it's running, it could offset 25 plus percent of the full load. We need to know when it's going to run and make sure that we're in a joint agreement that it needs to run. And we've had those discussions, and sometimes they require some additional understanding on both parties' parts to recognize that there are these linkages between the county's resources and the DOE's resources that staff on both sides down the roof, down within, say, LLUI, Utilities Infrastructure, they don't see that sort of thing. So that's important for us as the operating committee and me as operating manager to recognize those those areas where people aren't aware of how these interconnected things are and why we have to be aware of these things so that the costs are maintained in an equitable fashion and one party doesn't go and do something unilaterally that causes a cost impact to the other party.

Sorry, can you remind us how the 10-year contract might impact our ability to obtain large future or new resources? We're currently adding the ones being added. If the initial outlay actually spans, you know, more than 10 years and with a 10-year contract. Can you remind us how a 10-year contract might impact our ability to minimize our cost risk for big purchases that extend beyond that period?

So, for example, could we issue bonds? Yeah, that would be the biggest one.

So, Dan, I think the biggest thing that we've been doing In the past, it's rolled forward into the new ECA is getting a project on an approved resource. And I'll give Foxtail Flats as the example. The DOE put Foxtail Flats as an approved resource, and that's carrying forward in this new contract. You know, the development risk, that's with this termination clause that we'll get into a little later, is something we're trying to tighten up for that purpose if we make an investment and carry forward. If they said, yeah, we want you to get this asset online, and then we don't want them walking away later from it. Yeah, okay.

Right, I guess I'm worried about the next box. Go flat. Right? Okay. So that's going to come up.

And if I could just jump in, so we actually added a clause into the contract. That basically says that the county proposes long term modifications, new facilities, which are. The new resources, which may exceed the term of the contract, the parties may review additional options outside of the contract. And there's different financing mechanisms sort of parties that could enter into long term contracts with us to facilitate this type of issue. And then we also talked about rates and what those rates would be because I think as we look at new investments and long term investments that should be doing a 30 or 40 year bond for the particular item. This is the exact kind of discussion that we're going to have to have with them of how do we make sure that the county isn't holding the bag if DOE decides not to renew a contract or not to move forward. So, you know, we had that conversation with them. We put in some clauses to try and address that. We don't have necessarily the perfect solution, but we do have a process to work together on those issues as we're moving forward on the project.

Okay, that's very helpful. Thank you.

And just to follow on it, The framework that we offered is the Western Power Administration WAPA contract form where they can go up to 30 years for a project investment. So there's a way to kind of channel those rates and charges assessed mentioning through the WAPA agreement that would come back to the DOE. The DOE can get long-term contracts with WAPA. So it'd be kind of akin to our hydro we get at Lake Powell. We get an allocation of one megawatt and the lab gets 10 from that plant and it would be similar to that.

Thank you. Oh, I'm sorry, Jen, go ahead.

No, that's it, thank you.

I'd like to make sure I understand where we are and where we might go on this. If we wanted to buy something or issue a, let's just say, a 30-year bond, there's provisions in here now for dealing with costs after the end of the contract. But would those cover a bond that we would issue with the current terms a bond that we might issue that was for longer than the contract term? Or is that something that's going to need to be refined, shall we say, through the hopefully improved termination clause?

There's a couple of different pieces in here. So I'll address the first, which is a 30-year bond. under the current contract the only way to pay for that 30 years is to increase the cost uh so everyone's paying for the cost within the 10 years which is obviously not really feasible uh for for at least for the county it may be feasible for doe uh you know working or an nsa working on those issues but i think what we would have to do is look at the look at the particular at the potential solutions. So for a lot of power projects nowadays, the federal government uses what's called a utility energy services contract that allows up to a 30-day contract under these primary contracts. So we can look at adding something like that and looking at whether that project would fit under that. We can also look at, as Philo talked about, a process where we bring in another federal agency like WAPA who can enter into a contract with us, the county, for 30 years and enter into an MOU with NNSA for 30 years that matches. And so you can look at payments that way. But each one of these processes and each one of these new investments that we'd work on with NNSA, Under this contract, we have to come up with a solution unless it can be paid for within the remaining term of the contract. What we've also seen happen at times is we're three years into this contract. The renewal is then triggered so that at least you have 13 years for that particular payment as well. So there's different ways that I've seen this done. but you know the the limitation is what we'll deal with and then there's always the county just decided to move forward with the project irregardless of doe um being able to pay for the full term so there's there's there's a lot of there's different options doesn't give me one fuzzy feeling but thank you well we did the best we could with the limitations of doe's 10-year authority

There seem to be a lot of things here that can't be done because DOE can't, and DOE can't, and DOE can't. We'll discuss that later.

Thank you.

Next slide, please. This is one of the big changes to the resource cost and payment structure. It's a formula that describes I'll start off by saying the current ECA originally had a provision in it that would allow the county to get some benefit, financial benefit from the long-term investment to make into resources. I don't remember the details of it, but the functionality of it in actual practice went away because things changed. So the county never really had, after that happened, had a way to get a benefit from its investments. That's going to change here with this. This new approach here provides a mechanism for the county to get some benefits, financial benefit, from these risks that it's taking with long-term resource procurements. I can go into the details if anybody wants to hear how it works, but at the high level what it says is if there is a If the cost of energy for the power pool is below market prices in any month, we can look at that as, hey, that is effectively a savings over what we would have paid if we were just buying market power. And what it does is it takes that difference in prices, that split, and says we'll take Half of that's the cost difference, and we'll use that to adjust what the DOE pays for their power. We increase the rate that they pay by half of that, and that's that cost difference. So they pay a little extra for their power, and the county doesn't pay that. So they're paying a bit more for power in this circumstance where our energy is cheaper than market price. If the energy is more expensive or the same as market price, then we just split the, we just pay what we actually spent, and there's no change there, no adjustment done.

The idea is that the county is the one typically that will go through the effort of getting the long-term resources up and running, and if they happen to be quite efficient, then this is how the county gains some of that.

It's an incentivizing mechanism for... To try to make it efficient. To do as good as we can and keep costs as low as we can for both parties.

And do you have any sense how much benefit there might be to the county? I know it depends on cause and power, but can one look back and say, if this provision had been in place in the last five years, here's what we might have realized. Is that possible to do within reason? Chair, board members, it's possible.

We haven't done it. What I will say is if we look at the recent past where we had our roughly two-year agreement after the Uniper agreement was terminated and we had to go buy power, market prices were high. We were at nearly $80 a megawatt hour for a two-year agreement. And market prices were at that level. Just immediately prior to that when we had our Uniper deal, we were in the ballpark of $65-ish a megawatt hour. So that would have represented a $65, $75, $80, $15 difference between market power. And that's a different market power, not the Palo Verde index that this refers to. But that gives you an idea there was a $15 difference roughly between what we had been paying and what we thereafter soon paid with market purchases. So that gives you some idea, yeah, there was a difference there. And I don't know what it is going to the past, because I don't have done any study on historical market prices versus what we paid. But that's just one example of where it would have benefited us in that particular instance. if we hadn't lost Uniper and a whole bunch of other conditions. So that's why I say, I don't have a robust analysis for you. And I don't know what the future is going to hold as far as market prices. Right now, we're seeing market prices which are far lower than they were two years ago. That's what markets do. They move up, they move down. You can try to forecast that, but good luck.

Well, what I was suggesting, maybe looking at past experience, it's hard to forecast forward.

As they say in investing, past performance is not an indicator of future.

Well, that certainly is true, but trying to get a feel for, is this a $10,000 a month item or a million dollar a month item? Trying to get some idea of what the potential is here if it goes in our favor. Obviously, it goes against us.

The only thing I can offer you is a real quick and if you were to put some Specific numbers here in here and say there was a $2 split between what market index price was and what we paid that would on a 50 50,000 megawatt hour a month, which is like an average month for the county that equates to $100,000 cost savings under this agreement Under the current arrangement, $80,000 of that savings would go to the DOE and $20,000 of it would go to the county. Under this new arrangement, $60,000 would go to the county and $40,000 would go to the DOE. So it's got an extra $20,000 in there. No, $60,000 and $40,000. It flips. It goes from 80%, $80,000 to the benefit of the DOE, to $40,000 benefit of the DOE. And it goes from the county side, from $20,000 benefit to the county, to $60,000 benefit to the county. So it's a dramatic flip of where those cost savings are allocated. Where they go. Depending upon, of course, whether we're lower than the price. That's helpful. Thank you. Okay, any other questions? Because this one is a tricky one if you've seen it for the first time. I've seen it for about the sixth time and it's still tricky. All right, next slide. Miscellaneous costs. So real briefly here, miscellaneous costs covers a bunch of things that oftentimes time or routinely. I won't read into detail here. It handles a number of costs. There's also other things here that aren't this section that aren't described in here that we specifically added to address some of the cost structure inequalities such as things as you mentioned compliance costs for if we need to do something that only is required by the DOE and it only benefits them and doesn't benefit the county's rate payers that should have a different cost accounting yeah well we built some of that into the Miscellaneous cost section things like that specifically the ones we know about market price changes We don't know what EDAM is going to do to our market cost structure. We don't know how how effects of load forecasting and the cost financial impacts from errors in forecasting will affect the two parties so we build some understanding of that into this miscellaneous cost section to account for hey, what if one party makes a choice that harms the pool and But they made it by themselves. They made a unilateral choice that causes harm to both sides of the pool. Well, that's not really fair necessarily to spread the costs across both sides. So the miscellaneous cost section now includes some new provisions to address those specific areas that we had concerns about for equitably attributing costs of specific types. That's it in a high-level view. Any questions on that? You can always come back and we can ask more questions as we go forward. New approved resources, we've already had some discussion on that. I do want to say that any new, as Philo mentioned and Seth mentioned, there's many multiple provisions within the document for how new approved resources are addressed. In any case, they'll all start with the operating committee where those discussions begin. resources are considered in a timely manner socialize it between the two parties and say here's what we're looking at we've been doing that all along cfpp was went through the operating committee at the beginning geothermal resources that we're doing looking pursuing with uamps went through that process everything has gone through cell flats they've all gone through the operating committee and through this new approved resource process it's pretty flexible we While we have general rules for dealing, as I mentioned, with new resources, if a new resource comes along that bends the rules and doesn't really fit into that paradigm, it's at our discretion to go ahead and change the way those cost allocations work for that particular resource. So a lot of flexibility built into there, and both parties are aware of that and are mindful and respectful of that as they go along. questions and comments all right so we got this document out to for public both to the board members and to the general public in the published illness and we got some questions back from some board members so we wanted to take this opportunity to specifically bring up some of them you want to go into the depth of each one of them Philo let's just go through

already, but this would be just for the audience. I don't know how many people online, but it's high level.

All right. First one is a little wording typo, I'll say. It says will, shall. Obviously, it needs to be just one. I don't believe, Seth, you can weigh in if there's any legal distinction here between will and shall. This is not a specification, so... I'm not sure shall matters. But we'll clean that up. If we get an extension here, that'd be something that would get fixed during this extension process. If we didn't get an extension, we were just planning on accumulating into a list of mod one changes.

Since you're talking about that, this one's trivial, but the wrong date reference at the beginning of the operating procedures is not so trivial. Can that get fixed during this extension process too? Yes.

Anything we find, we'll fix. Within the best of our abilities and the contract limitations of the DOE.

Well, it isn't the problem here. It's the problem getting DOE to do it.

This that particular issue has been known about for a while and it hasn't gotten fixed Should be trivial but I Shall look forward to the resolution on this next comment discussed about new resources how they integrate so Go to the next slide This one's about alternatives

What alternative options to approving the ECA were evaluated by the DPU? We go into a discussion here about what we did look at. Like it says here, we didn't look at what would we do if we didn't want to have an ECA. We didn't really consider that as an option. Because of the nature of the interconnection of the resources between the county and And the DOE, we didn't see that as a feasible option. When you combine the fact that we are contracted for 20 years at Foxtail Flats and severing the ECA relationship will sever the DOE's obligation to pay for any of that. That, I say in here, I think I say here, bottom, that would change DPU's cost risk exposure for Foxtail Flats from estimated $2 million a year to $18 million a year. And I didn't see that as a feasible approach. That's not something we can assume, is my impression. Which is why we didn't look at it. People may have different opinions, but feel free to speak up now. We'll move on to the next one.

It may not be desirable And that's fine. The issue is if the two parties can't come to an agreement, right, then that's the reality of the situation, either now or 10 years from now or 20 years from now, right?

Yeah.

I think that's, you know, this is a quantified risk that we could, you know, kind of come up with quickly. It's substantial.

Yeah, yeah. And as you mentioned, if something changed and that was the path that we chose to go down, we'd have to figure it out. We don't even understand what all the implications of unwinding this connection that we have under the current ESA would be. We know they'd be severe. Next slide, please. And this is why. This little graphic here is something we put together to illustrate why the relationship between the DOE and the county is not a conventional utility-utility customer relationship. Everything in green is county assets. From generation, PPA at the top, Foxdale Flats, and then the distribution systems both for Townsite and White Rock. The yellow-orange color there is other parties, PNM, other transmission, Nora, Tri-State, Guapa, SPP, all these are the providers that supply only infrastructure that gets the electricity from our generating resources to the county. You'll note that all of our generating resources go through somebody else's transmission. We don't own any transmission except for 12 miles coming out of Elvato. So that's not a typical, not owning your transmission is not typical for a utility. Second piece of it is, All the energy that flows into the county goes to the DOE. Every bit of it, every single megawatt hour of energy that goes to Townside and White Rock flows to transmission and substations that are owned and operated by the DOE, not by the county. So we've got two other parties between our generation and our load. Not a typical utility arrangement, and that's for why the ECA is a benefit to both parties is because we are physically interconnected. If we were to separate, we'd have to establish some kind of transmission wheeling arrangement with the DOE. They'd have to go and get their own network integrated transmission service agreement with PNM. They'd have to do all their own management of scheduling. We'd have to take on a new burden of handling and interfacing with them as our transmission provider now.

I just wanted to add, at one time, White Rock was a P&M customer, and the county paid a substantial sum to bring them into the county. So we have some history of what White Rock was, but Right. It's almost other parts. The OE was essentially turned over the town. They built the town and then turned it over. So we have legacy issues just from our geography that kind of forces us into these arrangements. And left off our Laramie River Station. We can show you those transmission paths are very complicated, how we get energy into town. But it's not a clean path like you would with D&M, generator, distribution straight to the customer. We don't have that. We've got to go through a lot of parties to get there.

I like your graphic pen.

Thank Nick Nelson for putting it in. Yeah, Nick worked on it this morning. We're like, this is a good story to tell. We're well aware that it's a complicated path. And most people in the community, even at the DOE and at the county, don't understand that this is the way it works.

So I thought it was important to share. We're going to keep this around. Putting Laramie River in would be helpful. But the basic concept here is really good. We're not simpletons to try to visualize things.

We're not simpletons. It's a complex thing, but a little cartoon can help. Next slide. Let's see, this one is about cost sharing, risk mitigation, being able to . So this is asking about alternatives. For example, we signed up for Foxtel Flats with the understanding that we would have the DOE from LANL and Sandia National Lab, Kirtland Air Force Base, be off takers for that project. What would we have done if we didn't have that relationship? Would we have done things differently? And so the answer here is yes, if we didn't have that, we would look. And we have been looking for local resources. We've always, the eight years I've been here, we've been looking for smaller local resources and off-site resources as well, depending on what's available and what the cost price point is. We looked at CFPP for, I don't know, the better part of a decade here before it fell apart. And it started out at $60 a megawatt hour, and it went up to 90 plus, and that was the end of that. That happens sometimes, but we have to go and look for these resources.

We have to explore them, and we have to do our best effort to go and see whether they'll work out for us.

We're doing that now with Geothermal for a couple of projects for the new ramps. We're also looking at Geothermal with a potential partnership with San Ildefonso Pueblo. We were looking at a solar and storage project on the order of 20 to 40 megawatts with them a couple years ago. With the administration and the political changes that we've seen, that pivoted to geothermal instead of solar and storage. We're still looking at that as they pursue some grant funding for that and see whether they can make that construction work for them. And we're still looking for other things. We're looking for local storage. We'd love to have some long-duration local storage. We've talked about gravity vault, we've talked about energy dome, we're looking at iron flow and iron air batteries. All these different technologies as they mature and become commercialized, we're keeping them in mind about how they can fit into our portfolio, whether it's in a big way or in a small way. We're also looking separately, not just for the county resources, what can the county do for resilience and meeting our goals. We still have to be mindful of our carbon 2040 neutral goal. all that so my point here is we are looking at all these other resources we don't we didn't stop looking for resources just because we signed up for Foxdale flats we're still looking for resources smaller scale resources renewable energy energy storage that's an ongoing process and that's not going to stop big slide please there we go now we got six seven eight nine here These are all little short ones. Is it correct to assume the LANL DOE would disappear as a large off-taker without the ECA? And I say that's one possible outcome. I would anticipate that if the ECA wasn't here, the DOE would go and look for their best cost for resources. They'd do a competitive procurement process through WAPA, say, and go look for the best offer they can get, which may or may not be the county. Where else could they go for their needs? I mentioned a couple options. Going through WAPA and PNM and becoming a customer of PNM directly. Similar to what Sandia National Lab Kirtland Air Force Base was, they were a customer of PNM a number of years ago. And they decided they didn't like that arrangement. I don't know what the reasoning was. I'm sure they had a good reason. And they became a... customer of WAPA for their power energy procurements, and the county took on their scheduling agent services, which spread the costs of our fixed staff across another party, lowering the cost to the county. The next question is, eight, would there be any benefit to a different mechanism for us as a supplier and then as a customer? And then I said, we haven't studied that. If the deal, we need to be a customer under a regulated role rate, for example, we just treated them as as a rate paying customer and said you'll pay this fixed price for your energy. meter charges and service charges kind of thing demand charges we haven't looked at that. Is there a downside to lack for building this relationship to the EC versus some other. And then Philo, you came up with this answer here. Can you explain it?

Well, I think we covered a lot of that, discussing the fire cooperative agreement as a potential option. And we explored a few different methods we discussed a little earlier this evening and came down to the framework of this agreement is what we have to work with.

Question 10. Comment that DPU worked to negotiate a renewed ECA that meets DPU's goals and objectives. Do you believe this current version has done that? The termination for convenience not was including that and I believe yes. We had specific objectives that we looked at achieving and I mentioned some of them, you know, And mitigating the cost risks to the county through trying to get as long of a term as we could. The 10 plus 10 option here is the best that we could negotiate. We wanted 20, but we got 10 plus 10 option, which we think was a good mutual agreement that we could get. I mentioned the Palo Verde Index and how that calculation is done to the benefit of the county to get some financial compensation for these long-term commitment risks for resources. That was another big one. And there's also numerous other small ones. I'll mention some of them like for new resources, new facilities. The third transmission line that Dewey was building, it had been considered that when a certain threshold was met, that resource would become an approved resource following the standard accounting practices. We saw that and said, ah, that doesn't really work. We don't know what it's going to cost, one. We don't know what the repayment schedule on it's going to be. And we don't know how much benefit the county is going to get from it. We'd like to understand that before we commit to paying for anything. So that got modified. The DOE is amenable to that after I mentioned it and said, hey, we need to make this where we have a discussion about making this a new approved resource, not just a fixed trigger point and boom, it happens. So things like that, there were many other instances, I won't go into the specifics, but there were many other instances where there were things like that where we had to bring some additional balance to the county's benefit. And so those things got put into the agreement that we have now before us.

The next one we discuss what we do different, pursued that as best we could and then that and then the other piece of number 12 here is we did insert some of our known unknowns which the cost of energy day ahead market there's going to be some changes and P&M is going to implement that here this September and Once this agreement is put in place, we will be doing a lot of planning and discussion on how to do that transition to EDAM. Actually, Exeter, the consultant with the DOE, is going to make a presentation at our next power pool meeting about their experience at other laboratory sites. As a pool, we're really focused on that. And then just any other changes that may come down the road. You hear a lot about data centers and the impact to customers. If you think about these power pool arrangements, a data center comes in and they might take up all the excess capacity. This project is more expensive. Those are things we have to balance when we look to new projects. Older projects, when they're working well and maintained well, are more cost-effective than building new. That's just what we're seeing in the market. UAMP's natural gas plant, I could say, doesn't look much better than the CFPP did, given the cost of construction, the land they had to buy, and all the permitting and Transmission costs are incurring. So. That's that's an unknown. Just set an example.

And simple built in the agreement where the dam actually mentioned in the.

It is mentioned in the. At least in the miscellaneous cost section. It's one of the things where I added where these. I see it in the .

Yes.

That's in the miscellaneous cost section, right. OK. So we know that's coming along.

It just says the parties will figure it out.

Yes.

Yeah, I know that's . The main point there is we don't know what it's going to be yet.

It's a complicated transition, and we don't know all the details of it. But we are aware of it, and we know that it's going to have to be rolled into this agreement. That's all we can do right now is just recognize that it's coming. It's an acknowledgment and an understanding that we will work through the cost structure mutually. Next slide, please. This one is about new facilities and reciprocity for veto provision. So both parties, as I mentioned, have effectively a veto provision on any resource changes. it needs to be a mutual universe unanimous agreement between Philo and Cassandra McGee that's the bottom line there specifically this section doesn't speak to do it's only speaks to new Reese new facilities of the county and that was intentional as Seth mentioned that's because We wanted to acknowledge that there may be a need for other methods of handling longer term resource commitments through WAPA or through some other mechanism to get the financial surety and assurances that we need in order to proceed. So that's why it only speaks to the county's resources and the facilities in this section because they have a very specific function. Every other facility that you might add, that's covered already elsewhere in the document under the new and improved resources section and the changes clause. What does the term collaborative agreement, we already talked about that, how this is not a doctor contract, subcontractor position related collaborative agreement, nor is it an operative agreement. It's just indicating that we work together to make this agreement work. ECA questions and comments, 15, 16, 17. This is the last three. Why doesn't the contract discuss the 10-year option? I paraphrased, Chair Gibson, what you and I had conversation with, so if I got any of these a little off, I apologize. What is the CLIN? CLIN. CLIN is a contract line item number. That's what I mentioned. The contract has two CLINs, one for the 10-year term and one for the 10-year option. They're both tied to this agreement. I feel sad that I do that. Like I said, we can only see the contract award for us, which is CLIN 1. 16, are there any more details about how our termination for convenience would be priced? We will talk about that on the next slide. And Seth will get into the details of that. did we stop again working on the new cea the earliest reference i can find to it was in april 18 2022 reference of to consolidated comments to the statement of work which is what we are now calling the performance work statement so a good four years that this has been under consideration we got good four years determination for commitments Next slide, please. Termination of the contract. All right, Seth, take it away.

Yeah. So, termination for convenience is a clause that, whether it's written in a federal government contract, it exists in federal government contracts, regardless whether it's stated or not. It basically says the government can terminate at any time at its convenience, basically. So, the termination for convenience clause here generally identified, hey, DOE would pay. The idea of a termination for convenience under most federal contracts is the idea that the government, if it does terminate for convenience, will make the contractor, or the county is the contractor in this case, will make the contractor whole for the expenses that it has incurred. And that's always been a key consideration. Last week we received the contract with the dollar amounts in it, and it had a limitation of their liability up to what I consider, and I think what the county considers, a very low amount. And so we've gone back to the department and said, look, the idea of this whole contract is about cost sharing and about investment and future investment in the projects. And I think they agree 100%. And that's why they're agreeing to kind of work with us on this issue is to come up with a way to make sure that we cover those unamortized costs that the county has incurred. that there is a termination for convenience uh so that the county can continue to invest in these assets and that the parties are made whole so we sent over some you know uh proposed language um we're talking about it and um you know i think that's uh you know where we are right now to make sure that if do we terminates for any reason that the county would at that point be generally made whole under the contract.

Could you point out the offending language in the document says we have it now? I'm just curious.

Yeah, so it is page 7 of the contract at the bottom where it says the limitation of government obligations. Yeah, it has the full amount of the contract, which is 424,000,000, but it limits it to 6M dollars. The liability of the government was only 6M. Yeah, and and and and tricks on a sliding scale. So. Um, each year, um, what they do is every year they include a new dollar amount. And so that becomes the limitation. And obviously the dollar amounts will increase. This goes through September 30th, I think. So what, you know, once again, we have to sit down with them and kind of resolve this. We sent them some language that we've used in contracts in the past that basically allows the parties to identify the unamortized costs. and still allows them to meet their fiscal requirements under their contract, I think.

Okay. While we're on this provision, and this is on page 7, I appreciate some elaboration on this because it gives this $6 million limit, and then down in paragraph C, It says it's contemplated that the funds presently allotted to this contract will cover the work to be performed until December 1, 2026, which if it starts, if it were to start the 1st of August, that's five months, four months, I guess. Six million dollars sounds kind of light for that. Why is this even here? And is this a correct dollar amount? I don't understand this provision.

Basically, with the contracting officer identified, or one of the people at NSA identified, that's the amount of funds that they have available currently, and that they're going to issue a mod. I thought it was around September 30th. to increase the dollar amount to cover the next year. And so, and once again, that's what I'm used to seeing in federal government contracts. So even the lab each year, I think has a dollar amount and then each year they modify it and add the dollar amounts to that of what's obligated under the particular contract. So every contractor has a multi-year contract sees similar types of language. okay it seems weird to go have six million dollars to cover four months but uh um and and and ben and philo how how many how does that cover one month two months three months four months what does it cover about three months and i don't know if it matters or if this is just an error We can oh, I think it was it was what they were trying to do is what to get to the end of the fiscal year Yeah, yeah September 30 Where are they?

This dollar this just needs to be cleaned up.

Yeah. All right Yeah, if it's September 30, I wouldn't be as concerned. I made a note. Okay, so

It doesn't excuse them from paying the amounts that are due. So, you know, they have stuff to pay for the contract. They just have a ceiling right now of $6 million. Once again, I'm sure that's what they have allotted and budgeted. That's why. so uh file or ben do you want to talk about you know kind of what you were proposing by identifying um sorry thank you up until we

newly discovered this termination clause issue today I was recommended we approve this however it have an alternative motion in your packet and given the fact that we need to revise this termination clause fix some dates and hopefully get some language that will extend FIRM UP THE RENEWAL OR AT LEAST TALK ABOUT THE RENEWAL SOONER THAN 30 DAYS. WE WILL HAVE AN OPPORTUNITY TO WORK WITH NSA TO GET A ONE-MONTH EXTENSION. I'VE BEEN TOLD WE WILL KNOW FOR SURE BY NOON TOMORROW IF IT'S APPROVED ON THEIR END. BUT I WOULD RECOMMEND THAT THE BOARD USE THE ALTERNATIVE MOTION TONIGHT. And that would allow us to bring that to council next week once we receive mod 28. Is that the right number? Yes? Or 27? The next mod. The next mod, I should say.

Lost track.

I think it's 27.

Okay, 27. I wonder how many of those have been extensions.

So we'll do the extension, but then we'll cut when the new language is presumably negotiated and agreed. I think we'll have that back to the board definitely by August, regular meeting, but hopefully sooner. So we'll have to pick it up again and do the actual? Ideally, it's all been in a week, but I don't know for sure.

So we'd obviously like to get this done as soon as we reasonably can. Is one day the right number? At this point, we're within two months of the end of the federal fiscal year. I was thinking about that, too. Should we be looking at 60 to give us... No, they did not want to move into the last month of the fiscal year.

That is when they stop working. They do contract closeouts, so I think they're motivated to get something done within the next third. Good. Next month, I should say. We did have that discussion.

I don't want to mention that the alternative motion stated here slightly deviates from what was in the staff report, the agenda item, because it takes out the statement, the 31-day extension. It just says an extension.

So you want us to use this one instead?

Yes, that would be preferable. because I got affirmation from Dewey Contracting Office staff that it'll go through August 31st. So I'm like, that's what I want to use. Never mind the number of days. That's the ending.

The fate of democracy hangs in the balance.

I don't want to write any hiccups with them if they say 30 days and the path is off.

If we, let's see, haven't looked at all the requisite calendars yet, If we act on this on the 18th or 19th, I think it is, our August regular meeting, does that give council time to consider it?

It should, yes. Pretty sure, because we are looking at the water rate ordinance and gas rates. We have days in there after Reagan.

It does just occur to me, back on the topic we were just talking about, if the effective date of the 1st of October, we could still act on it in August. And if they are motivated to move in August, maybe we could do that. It doesn't have to be effective necessarily immediately. But whenever we can get it done, we'll take it.

I don't believe we have a contingency plan. We'll go with the alternative motion then.

It doesn't get us the mod. I'm pretty sure they'll deliver this mod. We just turn out the lights at the lab at the end of the month. I'll bet you they'd come up with something. They'll probably turn our lights off is how it would work.

You saw that cartoon, right? Here's a summary. The new ACA does recognize, as best as we could, the long-term nature of our needs. And it improves on the unique framework that's been refined for the past 40 years. And that last bullet is what we're striving to achieve. Next slide, please. So this is getting revised slightly. I'm adding a few extra steps in there. We'll work with the negotiate to get an extension, one month extension. And we'll come back and we'll work on the language, the fixes that we know about. And then we'll bring it back. And then follow those other steps.

Do you think you'll be able to at least Bring it back for further discussion at the work session in August and then action at the regular session? Or do you not know yet until you get further into the discussions with the board?

I won't know until next week because we need their chief procurement officer. She's away this week and back next week.

We'll work with it one way or the other. Okay, does that conclude your presentation, Ben? Thank you. Any questions? Matt and Jen, I don't see any there. It's still moving. He's awake, huh? Okay, so...

I have a quick question that I'll throw out there just to show I'm awake and paying attention. I guess I first want to really acknowledge all the work that's gone into this from Philo and Ben and Seth. And I think Seth made a great point about an hour ago maybe, you know, keeping our eye on the big picture of really making sure we get reliable and affordable energy for our customers in the county. But I think we really do have to scrub all the details and make sure we're doing our due diligence as well. And just looking at all the challenges, and I think when I say negotiating, I want to put air quotes on it. I think at the operational level, it's a great partnership in the negotiating arena. It sounds like people are motivated and want to get this done, and we need to get the ECA done. There's not a good... Good alternatives, but I think we need to prepare for maybe a worst case scenario. What if this does fall apart? And I guess my question to maybe just think about Philo or others is, are we negotiating with the right people? Should the county think about trying to negotiate an ECA with WAPA and at the operating level, continue working the way we are, but maybe removing the contract or I don't know if we could abstract it. at all by dealing with WAPA. WAPA can do a 30-year contract. That's what we want. So I guess, are we negotiating with the right people? For a provocative 3 a.m. question from Europe, how about that?

I think, Matt, the challenge is it's like the little cartoon diagram we presented is we still have to pass through the DOE and we're going to need some agreement to cost share as the energy is imported into Los Alamos County. So that's the challenge we have. Our community's unique in that really the DOE built it first and then turned it over to us. Our water system's intertied.

It's just a hard thing to break apart.

I just want to acknowledge what a great question that is, and that I wish I had thought of that at one point in my career. So that's a very thought-provoking comment.

Remember it for 10 years. Well, in theory, you could still be on the board, Matt. if this provision for allowing three terms goes through.

And I will tell you, we talked about the long-term contracts, just to add in. There has been some legislation And it's moved around the clean energy area. And the military services have it, which allow for 30-year agreements on individual power production facilities, not utilities generally, but for these long-term projects, potentially to add those in. And so we've been looking at adding that to the DOE world. well and so you know that may still be out there that's something that occurs either on the lame-duck session or some other time but it's something to keep in mind you know as we're looking at solutions here to make sure we can do long-term power purchases other questions at this point

Let's open for public comment, and then we'll come back for board discussion. So, do we have any, I don't see any potential public commenters in the room. Do we have any online in addition to .

Thank you, Chair Gibson. We do have one hand raised, and it's Joni. Joni, I'm gonna remind you that star six will let you

Thank you so much. I have a question about slide 14 and how it talks about that there's an attachment A for pooling of approved resources. And I have not located an attachment A. And this is the copy of the presentation that I downloaded over the weekend. So it's probably not in line with what you have currently.

Are you referring to the staff report talking about attachment A, the electric coordination agreement presentation?

Yes. The PowerPoint, and I'm looking at slide 14, point of resources that the biddy. And I wanted to understand if there's actually an attachment A, because I didn't see it in the materials that were listed in the agenda.

Attachment A is just the actual presentation itself. Right. That's what the file got.

OK. Great. Thanks for that clarification. And then I have some questions about the EPA itself. Will there be an opportunity to submit some public comments in writing?

Yes. You can just email the board.

Thank you. Will do. Thank you.

Thank you. Is there any other public comment? OK. That brings us back to the board for discussion. Maybe at some point here, a motion. OK. I don't see hands up yet, anyway. I'll make a couple. OK. Shirley?

So thanks for all the work and the discussion of this topic. I really think the cartoon kind of says it all, kind of says where we are, right? There's really fundamentally no option for the county other than to try to pursue an ECA. But that doesn't mean we don't have any leverage or influence at all, because it will be quite painful for an NSA if this were to dissolve as well. So it does seem that there is a shared fate, which is good. The devil is going to be in getting all of the details worked out. I mean, the fact that we found this termination clause problem the day of, we were supposed to, or the day before something, we were supposed to vote on it, indicates there's just a lot of niggling details that have to... to make sure that they're tidied up. On the whole, it seems to me, given that fact, on the whole it seems to me pretty fair, right? I feel that it seems like the costs are allocated in a reasonably fair way, in a quite fair way. It seems like the provisions for the operating committee and the power pool are all made in good faith and seem sensible for both parties, which is great. The 10-year horizon, I think, is going to be probably more, or maybe 10 plus 10, we don't know. It's probably going to be a little more problematic than we might think in terms of really any willingness to undertake long-term projects. It's going to require a lot more discussion than it would have, I think, in the past. I don't know if we would have... It's kind of interesting to think about, when we have done Foxtail Flats... if we were under this particular ECA we've had to have a lot more discussion taking on or you know whatever risk that would go potentially beyond the terms and maybe we would have had to explore some of the other options that Seth talked about I don't know I wonder about that so it's probably gonna actually not we but future boards and departments will I wonder if they're going to self-censor and say, you know what, I don't even want to pursue this option because it's going to be beyond the horizon and that's going to be painful. I don't know. Maybe in the modern world. Would we have done a CFPP type venture if we were under these terms? I just don't know. given all that though it does seem like it's probably and this I'm just assuming you can get the termination for convenience stuff worked out and when you come back to us in a reasonable state but it does seem like it's a pretty reasonable agreement to undertake but again we're gonna have to assume that the ten years I just coming back to that we have to assume that the ten years is really just ten years so already you know you're you're for you a mere seven years from now, right, to start renegotiating the extension. Hopefully that will go smoothly. Given all of those things, which it seems are unlikely to be changed, given all of those things, my sense is it seems like a pretty reasonable agreement.

Thank you. Gene or Matt, do you have any comments?

No, I'm satisfied. I sent a lot of questions in earlier and had questions tonight, and I think they've been answered quite well. I appreciate the detailed presentation and all of the discussion that we've had. I wouldn't mind at some point getting some more specifics on how we'd handle the Exhibit G, just having dealt with that myself. in contracts.

What was it you were interested in?

The exhibit G, just details of what the ramifications really are for us and the burden, but that's a fairly minor point, I think, at this point. Other than that, it's good.

Thank you. I have one Trivial comment. You're hoping to maybe get to fix a few small things. This is in the small things category. There is an old section in B7 under the operating procedures. It talks about the cost of gas in 2023. It places things on that, which makes no sense today. Now, it does say costs will be reviewed and updated annually by DOE and NSA. So if this doesn't get changed, it will have to get updated anyway. But why not update it as we go? That's the trivial one. We've already got the other trivial ones. Well, not trivial. It's the date and the operating procedures. The reference date is potentially important. Anyway, this is really bent. protracted and problematic and painful process and I credit Philo and Ben and everybody else who's spent who knows how many hours on this over the past four years. It's ridiculous that we have to spend that much. And I am curious, for all the time that you're spending on this, how does that time get charged? Does that get charged to the pool? Does that just get charged to the county? In other words, to our customers to pay for all this rigamarole. And Seth's time too, his contract. Who pays for that? Charge that to the pool. It is a pool charge, okay. All right, good. I'm glad the county's not picking up the whole thing. I think fundamentally this is really quite similar to the existing agreement. The existing agreement seems to have generally worked fairly well, in part because a lot of the things go through the operating committee, and that does seem to be a fairly cooperative entity there. I, too, was concerned about or am concerned about the termination and hopefully that gets fixed. And hence, hopefully that is an improvement by the time we get done. Another thing that appears to have been improved is DOE, for as long as I've been paying attention, which is a long time, has not been very accurate in their forecasts of electric power load. and that can depending on what resources we acquire to match their projected loads or what we don't acquire that can wind up costing our customers either way and there are hooks in here anyway details really we can't work out yet but at least there is there are hooks here to bringing in excessive poor estimates, shall we say, or to make DOE responsible for a poor system. We'd be responsible too, but we've got 8,000 customers. They don't change instantly or in a short period of time like we can. So I think maybe we're already starting to see the lab take projections somewhat more seriously. What I think I've seen recently isn't really as overly optimistic as they typically used to be. So maybe that's already a little benefit of this. And I hope it continues. And if they are way off, then they pay for it. Or at least there is a provision in here that says we'll figure out how they should pay for it. which is, I think, the best we can do right now. As I mentioned earlier, I am quite concerned about the option to continue, and I hope we can get something that's a little more clearer and more explicit in the final agreement. I hope you're able to work that out. It is disappointing that DOE says this is the only agreement of its kind in DOE. Well, in my view, unique circumstances point you towards finding unique solutions. And that doesn't seem to be DOE's approach. It isn't a typical bureaucratic approach. They insist on making this a procurement. And that's a basic problem here. in the structure of this thing at all an equal or partnership relationship. It is very asymmetric. Everything you read in here is DOE writes the rules, and the county lives by them. Them that has the gold makes the rules. They're the one who's paying for it, and we're just the vendor. That's the way the contract is structured. In practice, it has worked somewhat better than that so far. But as time goes on and government entities get to be harder and harder to deal with, because they have more and more rules, and they have more and more limitations, or at least what they think are limitations. So that has been a big problem. The fact that it's a procurement means DOE thinks that this should be business sensitive, a business confidential, excuse me, meaning it's not public until now. So for four plus years, this has been held in private. And the way that has worked out is the staff, our staff can talk to DOE because they promised they're not going to share information publicly. He can't talk to us. That's absurd. I don't think we should ever get ourselves into that situation again. That our staff is communicating with outsiders and not being able to communicate with the people that you work for. And that's the public which we all work for. That's one factor that has made this difficult, And then DOE winds up spring, finally giving us this thing at the last possible instant last week to get it on the agenda tonight. I don't know if that's coincidence or they just didn't want to give us any extra time at all to look at it and to think about it. Now, we've now got 30 days, which is maybe enough, but I certainly was not happy with them pushing it to the... very end like that. It hasn't been fun for you. It hasn't been fun for us dealing with this. One reason I hope we don't have to do it again for as long as possible. But as I say, I think this contract is as it stands if we can get at least the termination provisions and hopefully the Extension option provisions improved is better than what we've had, and what we've had has worked. So I'll look forward to seeing what we can do, what you're able to do with DOE to get these outstanding items taken care of, which are not new. We've known about these for months, at least. So, and so, presumably so is DOE. It's not something that came up, really came up at the last minute. Do we have any other board discussion? Or are we ready for a motion?

I will make a motion. So I move that the Board of Public Utilities request from DOE and NSA an extension to the current electric coordination agreement with a term through August 31st, 2026 to allow additional time for county review. I further move that the Board of Public Utilities recommend council approve such extension to the current electric coordination agreement. Second.

Further discussion. Seeing none, Kathy, would you please call the roll?

Member Hollingsworth? Yes. Member Heffner?

Yes.

Member Nockley? Yes. Member Gibson?

Yes. Motion passes four to zero. Thank you, everyone. I know this has been a slog, and we're not done yet, but this is a significant step. At least it forced it out into the open so we can now see it and work with it. Anyway, thanks everyone.

Mr. Gibson, real quick. Matt says he has some of the equipment's running out of batteries and he's going to be dropping off.

Okay, Jen, are you going to be able to stay with us? Because that gets us, we need three for a quorum. Thank you. At least a public hearing that we've got to get through tonight and a couple small action items. So Matt, if we lose you, thank you. And that's a good excuse to be able to go to bed is, oh, my battery's running out. I'll have to remember that one. But anyway, thank you very much. OK. And that will be different than it was because it's only for one month. Are you going to try to make it for two or just one?

It depends on the board's level of comfort.

OK. Well, let's move to that item and we'll Let's see what page that one is on. Okay, item 6B. It's approval of a power purchase agreement, and this is Ben again, so what would you like us to do, Ben?

Well, given that the extension, one month extension passed, instead of I would like to keep, instead of having to come back to you again, I prefer if we could just keep this and maybe we could add contingent upon approval for the month of September of the ECA approval.

So how do you want to just structure the recommended action?

It's only $9 million, so I assume council will just do it as a consent item and pay no attention.

We haven't tried to get it right. I will point out that it's $9 million. That's a ceiling figure. That includes some contingency in case. Better than that, yeah. Yes.

I'm just thinking out loud. How about we say approval of the first month and the second month is contingent on receiving approval for the ECA The issue is Ben's got a price. He's got to make a purchase in advance. But we wouldn't purchase that September month if we have a signed ECA. You need the $9 million and change for both months. That's enough for me. Yeah.

You've got to make that purchase at the end of this month.

Yes, to make purchase for August. I don't have to purchase September. Can we say, is that OK then to say, Okay, we approve 9 million and change. For a purchase, definite purchase for August and a contingent purchase for September. Contingent on approval of the ECA, is that what, is it contingent on?

Right.

If you can put all that in words that. I will try.

I'm not sure if anyone. Christelle, you're good with that. The dollar amount.

said they don't have a split for you here right now when that's why he's proven the whole dollar amount yeah with the understanding that because August is more money than September so okay let me try something and see if this works I move that the

purchase agreement with a yet to be determined power supplier competitively selected not later than July 31, 2026 in an amount not to exceed $9,195,750 plus applicable grocery sheets tax for the purpose of supplying power and energy to serve the Los Alamos Power Pool's electric load with a definite purchase for the month of August and a contingent purchase for the month of September contingent on whether the electric coordinating agreement is approved. And forward to council for approval.

There's a little gray area there on I can't contract, I can't get a price at the end of this month that'll carry over to September without making a commitment to buy that car.

So I don't know if that... No, I think we're going to commit to buying August, and then we'll deal with September as soon as we have an ECA in hand.

Would you automatically be buying from the same supplier for September as for August?

Not necessarily.

Not necessarily.

It's just the money is there if you...

That's why I mentioned that.

And from a risk point of view, that August is more money. We know that already. So that's just due to summer peak loads.

It's about $10 a megawatt hour more.

The risk is much lower than September. I feel comfortable about that.

So I threw some words out. It still needs to be seconded. reconstruct the words if you ask me. I hope Kathy's got it.

We have a Zoom transcript.

I'll second. Put it down for Jen. Yeah. The record will show she's still awake. Oh my goodness. see legal wheels turning, so let's hold off here a minute.

Chair, it was just a comment about how to describe the action item for the council.

Are you okay with the motion as it was made? Yes, Mr.

Chair.

Thank you. I suppose we have to ask for public comment on this.

There are no attendees online.

OK. Thank you. If there's no further discussion amongst the three of us who are still here, Kathy, would you please call the roll?

Member Hollingsworth? Yes. Member Notley?

Yes.

Member Gibson?

Yes. Motion passes 3-0. Joanne? That takes us on to the simple matter of the insurance rates. Let's make this quick.

Sit here, too, and go in. Your choice.

Alright, ready?

Ready.

Okay, so I'm bringing back gas rate ordinance. Well, I'm not bringing back this gas rate ordinance. So, 0-2-3-5 is the new ordinance. Back on June 9th.

Oh, okay.

So, back on June 9th, council rejected our gas ordinance 0-2-3-7-9. And so they had suggested us to come back and do a single rate increase. So I'm going to kind of go through this presentation. Some of it you saw before, and then we've got- One single rate, you mean single year? One single rate increase. So we're not doing it by year, because it's going to start one day and then it's not going to have an end date. So depending on when we bring another one. So it's not for a year. I'm going to discuss aligning our gas rate with some current operational costs and net income. Discuss the prices of our natural gas in New Mexico and compare it to you. Discuss how this rate adjustment translates to our average summer and average winter residential bill. And then I talked about the council rejecting our previous ordinance. And like I said, it's a single rate adjustment rather than a multi-rate adjustment. Let's see. And so one of the other things that was suggested during the June 9th meeting was an ordinance to remove profit transfer and to be put on an ordinance to be put on the November ballot. And so that was passed. And so we will see that if the public votes to take that profit transfer off, then we wouldn't have profit transfer anymore, so that may change in the future how we determine gas and electric rates. That means you could move monies from one... You just wouldn't be paying the profit transfer to the general county, that 5%.

There'll be cash left in the fund that wouldn't be transferred out, so there'll be additional cash, so we don't know the

Right now our profit transfer is being reverted back to us with projects with public works, but if that does go away, we wouldn't be doing that. Okay, so then Sorry. So this is kind of how did our gas fund do in FY2026. This is the same slide. We still have only calculations through May, and so we're still projecting about a $760,000 loss in our gas fund when we close out through June 30th. June 30th, we will have more or better numbers probably about mid-August of where we actually end up for our finances in June. I thought we were looking at more reading than that we were but based on some capital expenditures not being done this year so it did change that higher number from this fiscal year so we didn't finish everything that we had planned and budgeted for and so some of that will be carried over into FY 27 And then these are where our expenditures kind of fell in 2026. Our biggest is our cost of gas, which is at 37%. And then the next is our IDCs. And then the third highest one is our salaries and the gas fund.

What's an IDC?

IDCs are interdepartmental charges. Those are the charges we pay to the general county for services. The next one is our price of natural gas. And so this one I didn't do by fiscal year. I did do calendar year 2025 for both the New Mexico gas prices and the Department of Public Utilities because not all of the data for 2026 is available. So I wanted to do a full year's worth. So I did a comparison from January to December of 2025. So what this is showing, we found this data from New Mexico, from the U.S. Energy Information Administration, and they track gas prices, the monthly gas prices for the state of New Mexico. And so I took those prices and I took what our variable and fixed rates for each of those month in 2025 and did a comparison of what the state of New Mexico, people outside of Los Alamos is paying for their gas versus us and what we're charging our customers. So DPU is the orange bar. So you'll see in a couple of months that we were a little bit higher and that looks more like in January, February of 25. And then In some areas we were significantly lower and in the other ones we were lower. The next slide. So this one is just the same type of comparison for calendar year 2025 using the same data from the New Mexico price data and our data for that month and our average cost and just looking at how much 50 therms, 70 therms, 100 therms, and 150 therms are between the two. then we go to the next one so we um looking at our neighboring communities i changed this graph a little bit um because before we had zia natural gas and new mexico gas company as lines and so i made them as bars so that it would um different companies yeah you could see it a little bit easier and then the purple line is the new mexico price of natural gas delivered from that same website um So it's kind of showing where, we're the blue bar, so we're the first bar. And so we're kind of, 50 therms, it looks like we're falling a little in line with average cost for the state of New Mexico. And then kind of tapering, getting lower as more therms are sold. The next slide. As we showed during our budget presentations, this hasn't changed. Prior to FY27, we were calculating 75 therms as the average cost per customer. We did an analysis, and it's dropped to about 70 therms per average customer. So we're using that to calculate our average bill. So the next slide is, Abby created this. And so I think she had this over at the farmer's market. And so this is just a comparison of what our current rate and what we're proposing in this new ordinance. And so the biggest change is the per-term rate. And this is the fixed cost per term. And so we're proposing to go from $0.34 to $0.48 per term. That's a 41% change in cost. Our service charge is going up 9%. And then looking at the 12-month average for 70 terms, Overall, at 70 therms, it's about a 16% increase with the fixed and the service charge. And our winter average, we calculated about 126 therms per residential customer on average. And it's about 17% in the billing difference for the total cost. I don't know why it changed when I was doing the calculation. I don't know if it was a rounding issue where I won 16 and won 17, but it was really close. So we're proposing those rates. So it would be, and then from 1425 to 1553 per month. So here's our recommendations in summary. So we're asking to adopt ordinance 02385. This will align our gas rates to some of the operational costs that we're projecting. This is a single rate adjustment that would go into effect September 1st, 2026. What we're proposing is below statewide cost trends. AND THEN ADOPTING THIS RATE WILL PROVIDE STABLE OPERATIONS AND NECESSARY INFRASTRUCTURE MAINTENANCE. SO THE NEXT STEP. SO WE'VE ALREADY INTRODUCED IT TO YOU GUYS ON JUNE 17th, AND THEN WE'RE HERE TODAY PRESENTING THE ORDINANCE FOR APPROVAL, AND IT'S SCHEDULED TO GO TO COUNCIL ON AUGUST 4th FOR INTRODUCTION AND THEN A PRESENTATION ON AUGUST 25th FOR APPROVAL. AND THAT IS MY PRESENTATION.

James.

The main problem, right, we're fixing or have to deal with is the fact that it's warm. It had a very warm year. We just didn't use much gas, right? And as a result, we didn't get much revenue. And since the fixed costs, people and infrastructure and so on, you know, unchanged, I mean, we already have a rating problem. So we've got to fix that.

Yes, we do.

What was the... So, okay, so this is now going to increase a fixed rate per therm, as well as an increase by 41%, right? Mm-hmm. As well as an increase in the service rate. The only other way to fix it, I mean, the only other... And that kind of basically... Yeah, exactly. So you just have to have a certain... You have to have more fixed cash coming in. the only other way to do it is to is to try to cut costs somehow right so uh i guess i'll ask did you look at are there are there ways in which costs can be can be cut or put off in addition to something like this

Looking at just even our budget for FY2027, we don't have very many even capital costs scheduled. I think there's like 135,000 of capital costs. So that wouldn't make a huge difference. And then most of our other costs are like salaries and IDCs and contractual services and cost of gas. So I don't think in this fund particularly, there is a lot of cost savings that we could do by cutting projects

regular maintenance and stuff like that is Yeah, and I think I mentioned that the introduction when we did that presentation We've had our minutes by the PRC to do enhanced documentation and inspection a Few years ago. We added a position to have a supervisor dedicated to in that effort and I don't see a good path to reduce the staffing cost. And then Joanne mentioned IDCs. That's county overhead, but it includes the equipment, the trucks, and that's part of the IDC. I don't know if you can go back, Abby, to the bar chart, but we tried to enumerate that a little better with the bar chart for council, because they asked that question. which one high chart I'm sorry yes so you see the inner fund charges and gas and salaries you know there's the capital outlay is only 8% so it's pretty minor amounts that don't add up to a lot so the question that okay that makes sense on our surrounding communities if you go to the chart where you show the surrounding communities

Yeah, I think that one. So they surely are having all the same problems, right? They also had a warm winter. They probably didn't get the gas sales that they wanted either, right? Are they doing sort of similar rate increases to accommodate? How are they accommodating that? Assuming they have this problem, right?

I mean, they're PRC. Public Utility Commission regulated, so their increases come in gradually. We don't know what their 27 requests will be.

I also add that New Mexico Gas and Zia Natural Gas have a much larger customer base than we do. And so their number of pipelines per customer is far less than ours.

The infrastructure. That was why we found, what's the statewide average? We went to our National American Public Gas Association, we actually have one of those, and they gave us this reference.

statewide average I mean I reading this right it looks like we are getting to be especially with the proposed 27 rates looks like we're higher in all respects than either New Mexico or Zia I mean and in all the bins right and especially high on the large usually clay said they're

They're providing gas to Santa Fe, big gridded streets, lots of customers. Zia is Roswell, mostly. So they're larger entities that have efficiencies that we don't, that we may set up. This average shows more of when you get the smaller mountain towns, that's all averaged in. When you start going into these other averages, we're running closer to what the state average is.

Jen, any questions?

Sorry. Sorry, I lost my page. Yeah, I mean, actually, on this slide, just a number of questions could be a 3 a.m. brain keep talking. So if you're showing a current Los Alamos is $70.25 for 70 terms, I think on later slides, this is $60-some, so you get a 16% increase. confused where the 70 to 78 is coming from, because that's not the 50%. Maybe I'm missing something, but you might want to compare the numbers here versus a couple of slides later. And then the other thing, it's there, but just for public's understanding, the New Mexico numbers are actually FY25. So we're actually not comparing white apples to oranges. So we're hurting ourselves in this comparison. Presumably, everything has gone up since FY25. Anyway. Do you see what I mean by the current Los Alamos rate of the 70 terms is $70.25, not matching what's shown on the subsequent slide?

Yes. So some of the differences in some of those slides is that they don't include the service fee or the monthly fees, where this slide does include the monthly service fee.

right so that's where the it should be 16 right the average between the the change the proposed change for buying service fee change and the flat rate is a 60 73 all right

That's what she's getting at. Oh, okay. Well, we're showing the same number.

Yeah, we're showing the same number because we're calculating at the average of 70 terms, 78.53 on the proposed chart, as well as showing it as a sample residential bill here.

Oh, I see the... The current should be lower than .

Because it might be calculated at the 75 therms, is my guess. I could look at that, though. Yeah, yeah, yeah.

Okay, so anyway, the numbers are a little off. That's all.

Okay, I appreciate that. I'll look into that.

Okay, yeah. And the fact that we're fairly close to the lower therms compared to New Mexico is not that horrible, probably, because those are FY25 numbers. And she's already pointed out, we don't know what the other communities are doing to make the change. So it seems reasonable.

Thank you.

Thank you, Jen. Joanne, on the various bar charts, So these include the service charges, or are these just the gas charges?

They are the cost of gas, so it doesn't include the service charges.

Those are all just the cost of gas.

Right.

Okay. Then on the table, the sample residential bill, It says the note down at the bottom says that from source, EIA excludes monthly service fees. Did you exclude those from ours also?

No, not on this chart. So the EIA, the purple line, does not include a service fee, but the other calculations for EPU, New Mexico Gas, and do include the service fees. They're all different, they're all different, called something different, but yeah.

Okay, so if the EIA number, the New Mexico number, included service fees, it would actually be higher than, the curve would be higher than what's shown here, correct? Correct. That's important because the service charges are a big piece of this. Right. Wouldn't see by looking at this and what to be pointed out. That's all I had for questions. If nobody else has any, we will ask for public comment. Do we have any public? There is no public. There's no public paying attention. They all have better things to do than me. They're all at the other meeting. They're waiting to gang up on council when they go to council. They make them early and pay. Okay, back to discussion. Comments before any motion is made? Or when will the rates go through effect?

If these pass through council, they'll go in effect September 1st.

I've got a couple of comments. I think the root causes are a little different than what Shirley outlined. That's the most proximate, an obvious proximate cause. But one, I think our reserves are low, and have been low for a while. And we don't have a quantity stabilization reserve as such, and gas, reserves we used to have a rate stabilization reserve but since it's a pass-through now we don't have that and that may be something to think about when we take a good look at reserves this is you think that one year dip in usage is something we ought to be able to cover from reserves and not have to to play around with the rates at least for that year. But we didn't have the reserves to do that with. We were way under. But even on a longer term basis, I think there's a root problem that rates have not been increased over many years as much as they should have been. Now, I went back and looked through the old rates going back a long ways. And it turns out that if you look at the total utility bill for the typical customer, there's a gazillion caveats in that statement, but you're trying to have something to compare. Our rates basically have been tracked over time, averaged over time, smoothed over time, have basically been tracking inflation. We're not, I mean, yes, right now they're going up more than inflation, more than CPI because they weren't for quite a while. We had that long stretch of, what was it, eight years that we didn't raise electric rates at all. Gas was kind of the same story for a while. So everybody benefited from that, but they'd forgotten that, of course, or didn't pay any attention. Now when we're having to catch up, and that's what we're really doing here, people are noticing. And no surprise. But over time, we really haven't been going up any worse than inflation has. And interestingly, if you look at the gas rate, we put this pass-through rate in in 2013. Before that, we were trying to adjust the rates all the time, and that was a real mess. The gas rate today is just about the same as it was in 2006. And that's in current dollars. That's not inflation-adjusted dollars. You were paying the same number of dollars then as you are now for the same amount of gas, adding the service charges and the commodity rate together. That's a whole lot better than inflation. People aren't going to recognize that right now, but there's a reality. 2006, I'll take that back. It was actually 2005. I misplotted one by one year. It varied a lot back in there because the utilities and council was trying to chase the varying cost of gas and change the pass-through rate. But we really haven't gone up in inflation of just dollars at all in our total utility bill. Different ones have gone up at different times and down at different times. In the case of gas, the reason it's still fairly constant is, or what it used to be, is the price of gas, the commodity itself, has gone down, thanks to fracking largely. So gas is a lot cheaper than it was. But of course, over time, our operating costs have been pushed up. And that's what's pushing it up now. It's not the cost of gas itself so much. So I don't feel too badly about this, even though it looks bad at the moment. If you look at it on a long-term basis, I think we've done OK. And we need to continue doing that. I went to one talk at the APPA convention where they talked about conveying utility rate increases. They were talking electric, but it's the same thing. And they made the point more than once. that people kind of unfortunately understand inflation. That's kind of baked in. And we're generally better off from a public relations standpoint just doing incremental increases every year instead of having to do big ones every once in a while. And since we've got behind the power curve, we're kind of forced into the latter. Longer term, we should probably be thinking of the former. Unfortunately, we're going to have to adjust at least for inflation every year. There'll be other variations on that, but that's probably the first order effect is inflation. Now we're trying to catch up from years of not staying up with it.

Any other comments? How do we better communicate this to the public? Because I am concerned that we're getting a lot of pushback and misunderstanding out there.

Gee, we ought to just ask Abby. She's the pro at that.

Honestly, Jennifer, I think a lot of what we're hearing is just because there's so many rates coming at one time, people are just overwhelmed and not really looking at the individual rates. And then what we're also seeing is that when we talk about the percentage increase versus actually showing what a bill could look like is really changing the conversation too. That's what we're kind of seeing, but there's a lot of people out there that are communicating to us that just don't want to listen. They just want to vent, because it is a lot happening at one time. And time of use. And time of use, and groceries, and all of it happening at once. So it's not really a matter of better communicating, I would say. It's kind of like thinning it out and doing little pieces at one time instead of trying to inundate them. is what I'm engaging. But I'm open to feedback on how to better communicate these hot button topics.

Yeah, I mean, I think for the time of use, it really should be emphasized as an opportunity, actually, to control your bill. Yeah. Yeah, I mean, with the rating cases, the story is sort of similar across the board. It's not identical from, you know, utility, but there are some commonalities, right? So getting that main message across with respect to how things have been held steady for so long. That could be a single story, even though it's separate, right?

Something that I don't think is emphasized very much is that the time of use and demand charges are the actual rate increase is only, I think, 8%. People don't look at it that way. Oh, now they're adding demand charges and this, that, and the other. It's not adding. We took that into account when we set the rates. So the overall rate increase is only the nominal 8%. It's still more than we'd like, but we're not adding demand charges to that. We reduced the other rates because we were adding the demand charges. But what it's worth, I've actually got a draft newspaper column not too far away from being ready to go that tries to make some of these points also. You have to try it from all different dimensions. And rate increases always bring out People who don't like rate increases, regardless of how much they are, when they are, how they're structured, whatever. It could be 2% and they wouldn't like it. But that's just the nature of the business. OK. Are we ready for a motion? Anybody want further discussion here? No.

All right. All right. I'll go again. I move that the Board of Public Utilities recommend that Council adopt Incorporated County of Los Alamos Code Ordinance Number 02-385, an ordinance amending Chapter 40, Article 3, Sections 40-151 and 40-152 of the Code of the Incorporated County of Los Alamos pertaining to gas service rates.

Second. Further discussion? that be?

Member Nockley?

Yes.

Member Gibson? Yes. Member Hollingsworth? Yes. I think it was a yes. 3-0. Yes.

Okay, thank you, Jennifer. Okay, motion passes 3-0. Okay, it is 18. I propose, let's see, I'll have to ask Jen, because you're the one who gets pushed out here. Are you okay with us taking a 10-minute break here before we continue with the rest of the agenda.

Well, we have a couple more action items, although they're short, that we need to do tonight. We could move

most or all of the other items on the agenda into the work session. All the reports, the annual update on wastewater systems, and even the tickler file. Jen, you're the one who's most inconvenienced here. Would you rather that we move these items? It'll make the August work session .

No, let's continue.

You okay with us taking a little breather here?

Yes, go ahead.

All right. It's 8.20. Let's try to be back here in about 10 minutes. We'll stand and reset. Okay, welcome back, everyone. We move on now to board business. It starts with the chair's report. I think I've got three items tonight. First is that the annual report to council was made last week on the 14th. I think it went reasonably well. I didn't get shot anyway. There were the usual questions from one councillor about, what's the long-term plan? What are you going to do after Foxtail Flat? How are you going to reach the 2040 goal like we... like we have every detail worked out at this point. Probably get criticized for not having every detail, but that's the way that one usually goes. There was a query from the council chair asking for some more information about the EMLA water projection, if you will, and It would probably be helpful if you or Clay or somebody got together with Randy at some point to address his concerns or questions. He wasn't really concerned. He was just trying to understand it better. Second item is, along with Philo, I did attend the APPA, the American Public Power Association Conference, at the end of June. In Boston, just before the weather got really hot there, I did put in the agenda doc kind of a list of principle takeaways that I remember. And in the interests of time, I'm not going to go through all of them. If people have questions or want to discuss anything, we can. Otherwise, I will not spend any more time on it, since it is here. I don't see Jen hopping at the opportunity to extend the conversation there. Third item, I saw a report a few days ago on the, I think I mentioned a year ago or so that there was an effort made made to look at the HVAC in this building to see if there could be any efficiency improvements. And after a year, the answer is yes. Most of what was done was just what they call recommissioning, getting all the controls that were put in originally working properly and calibrated properly and so on. They also did some some AI work to try to figure out the optimum operating procedures and parameters for them. Altogether, this is only after one year, and some of it is a lot less than one year. So we really need to go through a full year to see. But they were suggesting altogether something like around a 17% energy saving for this building, which is not insignificant dollar-wise or carbon-wise. And this is one building, the biggest building of the counties, but one building and maybe pretend opportunities for further savings down the road. That's all I have tonight. Are there any board member reports?

Just a brief one. Earlier today, I attended the FY26 audit entrance conference audit committee meeting, like a kickoff for this process. They've contracted Hinkle and Landers, the accountants, who are working on the audit for this year. The annual comprehensive financial report, or ACFR, will be due December 31.

Thank you, and thank you for doing that.

Utility managers report. Chair, members of the board, the White Rock substation, our constructor, the drill, drilled the first pier, built it, but then the second one had a hydraulic leak and had to shut down. And they're seeking to get a new drill rig in next week to restart. project always has some challenge. Elkridge, all the homes are on the new system. The old gas system is completely abandoned and we're working on the closeout documentation. New Mexico Gas Virtual Pipeline is in operation and they've got one section of the hydro test completed and their way towards Santa Fe so they'll be moving further out. The venting will be further out. The reason they vent and not burn off is we're in the fire season and they can't do flaring and open flames. And then there's also two weeks behind schedule so that truck arrangement we'll see through the end of August right now. And time of use and demand charges are in place. We did find some metering issues at an apartment complex that we're working to correct right now to reprogram the meters. The AMI portal unexpectedly went down, which hasn't helped with our transparency. But staff is manually checking the bills for accuracy before they're mailed out. and we issued a press release late this afternoon explaining all that in more detail. Recruitment status, Stephen Abeyta, who was our TWS supervisor over the gas system, was selected to be our new superintendent. Stephen is a very hard and knowledge worker. Water operator, we just had one start this week. He's going through the higher orientation. And we hired a senior engineer and an energy and water conservation coordinator, and they're starting in the middle of August and next month. And then our remaining vacancies is the electric distribution engineering manager, the associate engineer, management analyst, and three power system operators, as well as our facility locator. And then Hemings Mountain Fire Protection Project. We've been working with the Department of Homeland Security and Emergency Management. They reviewed our material procurements for the ski area, you know, to bring the electric up to the pump houses and up to the ski area. And we've gotten feedback on that and we're moving forward with procurements. That grant will cover the undergrounding of the electric lines and the removal of the overhead. The sanitary survey that we got from New Mexico Environment Department on our water infrastructure, all the items have been corrected and closed out. At UMAMS, we just had a remote meeting and there was no project updates that were participating. San Juan County, this is really good news, is they accepted the closure of the San Juan Generating Station in demolition and remediation. They had an ordinance called 121 that required any coal fire plant in San Juan County to be demolished when it retires. I think about five years ago, I was in a lot of meetings. At one time, NM was proposing just to leave it in place for 30 years because their retirement reserve would earn more money in the stock market than getting the work done. And that didn't work with public power agencies because we can only invest in treasuries. time that was maybe zero to two percent so really pleased that that that was this ordinance was the tool that got the plant to the ground just to be honest so after three years of work that it's it's done the mine is goes through 2030 there's a lot of work earthwork and revegetation Hopefully next month I can report that out to you because I should go out there at the end of this month to see if they're going to have a site visit. And then Chair Gibson mentioned about a PPA conference. I attended a pre-conference seminar on strategic planning and there was a lot of good ideas and actually we did exchanges of ideas. managers were there. And I met after that with Kathy Darwin, our facilitator. And what we discussed for doing this year's strategic planning is to have our new deputies do a SWOT analysis. And then we're going to come back on our strategic planning and share that with the board members as a way to kind of kick off updating our goals and objectives. And I think that'll be good because our board's been the same. Our senior managers have not, so I think it'd be good for the board to hear their challenges. opportunities that we had before us.

Are you expecting to distribute that ahead of the meetings? Yes.

It's due this week to do the SWAT and we meet and go through some things and it will be kind of the normal packet.

Was there any discussion at the conference about the

this in the current year there was some generally and one of the general sessions and everyone's struggling with IRP planning it's not not the same and so I think when we're gonna do an update I think in a month or two it's on our agenda discuss the strategies going forward let's see I did some other breakouts strategic communication risk with modernization and operational excellence. I attended this RP3 strategies, the reliable public power provider is what RP3 means. And I'm recommending that we consider using this as our once every five year peer review. That's required by our county charter. So I attended one of those sessions. We've done APWA, the public works kind of covers water and sewer industry. This is a little more focused on the electric industry. So I think it'll be helpful as we do our operational excellence. I can bring more back then when we get a little closer to it. And I attended a groundwater conference last week that we talked about the Rio Grande and that it's fully appropriate. They had a lot of discussion on models of groundwater use and how it's impacting the Rio Grande. And the state's not able to meet their compact flows because it's literally soaking in the ground and the river's drying up. Elephant Butte now is at 2%. They're cleaning out all the garbage at the bottom because there's no water left. So that's going to be a big challenge for the state. And they had a presentation with Santa Fe and how they're using their San Juan Chama project water to augment their water needs to supply their... And please keep in mind that When you have a trans-basin water diversion, it doesn't count in the Rio Grande Compact. It's new water. And so you can use and reuse that water to extinction. And that's the plan that Santa Fe is working on. And we'll be looking for how they do their credits, consumptive use, et cetera, when we do our modeling for looking at how to develop the well at Overlook Park. And just kind of follow on that, the San Juan Chama Project Water, we had meetings on that and basically was informed we got our final allocation for the year. Subject to, you know, if we get heavy monsoons, they could give us some additional allocation. 326 acre feet out of the 1,200 is all we're getting. And the Rio Chama Sankey Association, we have our last year of that contract. going to purchase that water from us and we'll look at next year whether we want to continue to allocate or if we've got a project planned over the park we can kind of time that so that water gets used for beneficial use and we had I attended last week instead of going to the work session the LANL consent order audit scoping meeting where it's a consent orders between NMED and the DOE and as part of that they have an audit that looks at how well are they doing getting the cleanup activities completed and done. There is a lot of comments Everyone's looking around the room, who's going to go first? And I jumped up and went first, explained about the chromium plume and its impact to our community. And then the Pueblos, three of the Pueblos followed with the same concern. And so that was helpful to elevate that review of that activity by the auditor. She said that she will be looking at it closely. And then last, atomic fiber. We've been eating with Bonfire quite a bit from implementation to locating of the fiber. The county fiber right now, Clay's group does the locating and eventually majority of those assets will be turned back over to Bonfire to manage because they'll have their fiber in our conduits. And so we're working on an arrangement where they'll take over the locating of all the fibers. So we have about one person or two people doing that kind of activity throughout. So I'll stand for any questions.

Questions?

Is the hexavalent chromium plume discussion, is that just still kind of deadlocked at the moment?

And it's definitely, I don't know, I think Anne went to another meeting, maybe she can update, but it isn't kind of a deadlock. They're trying to push it forward. Drilling is still occurring, which is helpful, because that's one activity that we can say is being done. Treatment is another challenge. You had?

Yeah, I mean, the short story is, you know, it was... Last fall, winter, we had some really good, everybody participated in some prioritizing what the actions are and how things are moving forward. And then once the fines took place for NMED, it kind of shut down. And so now there's every other week a conference call where they, it's just with NMED and the Pueblo, but it's kind of an odd meeting where it's just the state agencies, like the engineering office and the third one is but they're just kind of going back and forth about what they think I'm not sure where that's going and then I think some of you may have seen them so it's very it's it's getting very elevated and then week in the week whip hearing We're all sort of saying the same thing about we'd like to see the interim measure turned on. We want to see it possibly. I don't think any of us really know what that looks like.

Thanks. Any questions, Jen?

No, I'm good.

Thank you. Okay. Thanks, Philo. We'll go on to the county manager's report.

Thank you, Chair and Board. We have a lot going on. I'll just mention a few highlights that come to mind, but if there's something you want to ask me about, please let me know, because I can't cover everything. Trinity Drive is starting a project, and then I've also been given word that there's going So we're trying to reach out and try to make sure we're not creating a bottleneck there. I don't think it's gonna be any closures. There will be open lanes in both directions, but just watching that closely to make sure that we're, traffic is flowing. We have done a really great after action report on June 10th or June 19th when it was a holiday for the community. The DOT hadn't told us they were going to work, but they decided to work on trying to get out of White Rock. And they were actually working in both directions, construction in both directions. And then a traffic accident that was not in the county. It was just outside the county. So Santa Fe County Sheriff was 40 minutes away. And it happened to be that it was injury involved. And so there was no shoulder injury. traffic going around the accident. The policy said because of the nature of the accident, they couldn't move the vehicle until the investigation was done. So it was at least a couple of hours before traffic was over. So anyway, we did a really nice after action report. Of course, it usually comes down to communications, reaching out to folks, explaining to them how we need to be communicated to as a partner so we can do conversations. I would mention that a lot of discussions with Council around potential private partnerships under the Local Economic Development Act or Metropolitan Redevelopment Area. You've probably seen in the media two of them that have been introduced by the private landowners. One is The Rock, down in White Rock. The one that's here is the Bee Fox Rehabilitation Building. There's going to be another one coming, which is the Old Hilltop. I think they're going to have their initial update next week. And then we have ones coming from Palm Bay. And we're getting close on those. So opportunities for public-private partnerships. Across the hall tonight, they're hearing about site plan approval for CB Fox. And is hearing about parcel where there's a from the high school on Diamond Drive where there's a food truck and they want to be able to put infrastructure for up to nine. I guess I just mentioned that we talked about information and hard to get the correct information but what I'm seeing people commenting on is it should be this it should be that and And I just thought, you know, it's a good opportunity to get more advocates out there of, you know, when it's privately owned, the county's not dictating the use. We're just comparing the use against what's allowed per zoning. So we don't have that kind of latitude, really, to deny use that's allowed per zoning. So I just thought I would share that. And then 19th Hole is open. So check it out. New vendor. there but lots of exciting things elections season so a lot of other topics being talked about oh we are going to be scheduling a town hall the police department is it's probably going to be on august 17th but not totally confirmed yet um basically we're just going to invite community members who are concerned about the police department's use of either automated license plate readers which is not automatic license plate readers it's separate the hands-on see the equipment learn how it works and then just trying to put out some FAQs and more information to address some people's concerns about the technology and it's a little bit more a lot of it's about how it's used and framework and then it's also about what we're not using we think is problematic and it's leading to some of these concerns. So we're going to try.

Any questions for me? I don't see any. Thank you.

Thank you very much. We had a work session last Tuesday and I just want to say that did a great job with the presentation and there was a great demonstration from Dave Krueger the Dio about the community dashboard and performance metrics and if you guys haven't had a chance to mess around with this look at it I'd encourage you to do so they They've done a really great job on that. You can go on there, for example, and look at housing. There's a map, and you can click on any of the housing projects and get all this great information about them, how they're moving along, where they're at in the stage of development, how big it's going to be, who's funding it, all kinds of great information. So it's a really great resource. And then there was an update on the comprehensive plan update and that has been happening since the beginning of the year and will probably go till the end of this year. There is a survey that's open right now and they're trying to get input. They extended the survey and if you haven't done it, I'd encourage you to go on the website and do that. They're looking for a little bit more feedback on that update.

and um that is about it any questions i have one sure on this dashboard this the all this information about the various projects does that indicate whether they are all electric or or whether or not they have gas heat or other gas appliances

I don't think that's on there to the best of my knowledge. I don't think any of these are all electric.

I'd have to look. I mean, the Fire Station 4 is going to be all electric.

This one is specifically housing?

The housing. There are several of the houses. We are not having any difficulty in getting developers to agree to doing housing units all electric. It's when they're mixed use, and it's the commercial piece that we're having difficulty with developers agreeing to go all electric. What they're saying is they're willing to convert when the commercial kitchen technology and things like that catch up or are able to better compete.

But I don't think that's highlighted in there. I'd have to go back and look again. It is not.

It is not. It is not.

But you're saying the pure residential developments are going all electric?

Well, I should say the residential components of the mixed use are largely electric. I can't, I think they're all using heat pumps. Conductions, yeah. The marketplace for residential is not a hard sell electric product.

What about the single family homes, the things that are not part of mixed use?

We are not. tracking or regulating that because we're not doing public participation, so we don't have development agreements related to those details. The only way we would know about a single family detached or something like that is if they . Now, regulatory doesn't provide access to, yes, if it's available in the right of way.

But wouldn't the site plan for

family residential doesn't have to go to site planner for all right thank you thank you see any other questions do we have ESP on miss Shannon Blair was absent but she submitted an email comment I could read it or attach it to the minutes how long is it few sentences, three sentences. The Environmental Sustainability Board voted to not recommend an ordinance on banning plastic bags at retail locations in the county. The memo will be provided to county council for their review and Chair David Hampton will provide an in-person update on August 4th. Angelica Pudule will provide a quarterly sustainability update to Council on also on this work. The update includes sustainability initiatives including some of interest to be commutes such as EV charging and general greenhouse gas emission reductions for renewable electricity.

Okay.

Okay. Thank you. Any other general board business?

I was thinking about Arbolada because that's a planned development and they're breaking up 18 or they're breaking up how many acres into 80 different units lots that did go to site planner and that is purely private the county doesn't have a development agreement

We need to research that. Only on the single-family homes on the COTA SAC. The rest are all electric.

Oh, thank you. Good. Okay, that takes us to item 8H1, discussion and possible approval of the participation in the Los Alamos Nuclear Forum. That is August 25th at Sala, and there is a cost to attend, although the suggested motion talks about training and per diem, and I'm not sure why training or per diem would be involved. It's just a matter of registration, I think. Are either of, let's see, Jennifer, are you likely to be here and interested?

Unfortunately, I won't be here.

You can actually participate online if you're interested. Charlie? I think it's an all-day thing, but I'm not sure that. It is. It seems to me we ought to have somebody there anyway. So we can talk to Eric and Matt about whether they're interested. If somebody else wants to go, I don't need to. But I didn't see a deadline for registering. The suggested motion just authorizes expenses for board members, so I guess we don't really have to name participants tonight. We can approve expenses for any board member who wants to attend and then find out who does.

Chair, maybe you could approve for two board members. Can't have three, but if you want to do a general motion, then we can check with Eric and Matt.

There's a clause in here that says if more than three wish to participate in a quorum, then this would be distributed.

Yeah, it actually should be important too, but it's hard to believe we'd have many who want to participate. And we could do that later if it turns out that a lot of people want to attend. So I would suggest we go ahead and do the suggested motion with group training and per diem expenses, perhaps not included, just expenses.

That's just the line item in the budget. That's what it's called.

Ah, that's what it's called. Okay. All right. Thank you. Okay. I'm okay with doing that then. Doesn't it specify how many so we can figure that out? Shirley, would you like to be our motion person?

I would love to make a motion. I move that the Board of... approved training and per diem expenses not to exceed $500 per board member to participate in the Los Alamos Nuclear Forum on August 25th, 2026 in Los Alamos, New Mexico.

Second. Any discussion? Should have asked for public comment.

There is no public.

Okay. All right. In that case, we'll vote on it.

Yes. Member Gibson? Yes. Member Collinsworth?

Yes. Motion passes three to zero. Okay. You can delegate whomever you want. Okay, that takes us to discussion and possible approval of BPU participation at the UAM's annual member conference. I think there was a blurb on this evening about that too this is also general without necessarily saying who would go it's also in Logan Utah and fifth is running right into our strategic planning meeting I was planning to go but make it back for the strategic I have a direct flight from Salt Lake to Okay, so are either of you interested in going to this? Chair Lee? I'm sorry? Viewful Logan, Utah? It actually is very pretty. That of course is not why people go to these conferences, right? Okay, Jennifer, any interest?

I won't be in the country, and I'm actually attending the American Chemical Study remotely, so yeah, that week is not good.

Okay. Again, we've got two people that can't respond tonight. We can make the motion to approve somebody participating if they want to, and that gives us some flexibility. How is our travel... Training and travel expense budget going. Are we okay? We're just starting the year, so. Lots of training and travel to be done.

Yeah, I quit.

Okay, what do you think? Should we go ahead and approve?

Sure, let's go ahead and approve in case somebody wants to go.

In case somebody does want to go?

Yeah, that's fine.

All right. So I'll also leave off the second clause. All right. I move that the Board of Public Utilities approve training and travel expenses not to exceed $3,500 per board member to participate in the UAMS conference from August 23rd to 25th, 2026, in Lowland, Utah. Second.

Thank you, Jen, again. Any discussion? Any public comment?

There is still no public.

Has it picked up any yet, huh? No. He must still be going and consuming our public's interest. Okay, Kathy, would you please call the roll?

Member Hockley? Yes. Member Gibson? Yes. Member Hollingsworth? Yes. Thank you.

Okay, motion passes three to zero. Okay, that leaves us with the annual update on wastewater systems and tickler file. I'll ask Jen if you want to hear the annual update tonight or if you'd like us to postpone that.

It could be postponed.

Okay. That's fine with me. Okay, let's postpone that until the work session next month. And that takes us to the tickler file. Our monthly meeting will be Next Friday, a week from this week on the 31st, by which time Matt will be back. That's why it's delayed a week. So does anybody have any questions or comments right now on the ticker? You can also let us know before that meeting on the 31st. Any input right now on the ticker?

Chair, just a question on the prior item. Status reports, I assume you need to say that.

I'm sorry, I lost right over those, my mistake. Let me go back and ask if there's any questions or issues on the status reports. I don't hear anything coming from Jim. I don't have anything either. Thank you for catching that. Back to Tickler. Okay, so one small issue. I go on page 329, page 2 of the Tickler file. Maybe this is for Kathy. Bottom, the last item there on the presentation on living in solar policy, it says action requested. Well, if it says presentation, I assume that that's just a presentation. Is that clear to them?

Yeah, that's just a click box in the legislature that I need to change. Okay. So I can change that.

Okay. Anything else on that one tonight? Okay. Final opportunity for public comment. Desperately seeking a public comment.

Still not.

Okay. Thank you very much, Jennifer. We really appreciate you hanging in there tonight or this morning as it is for you. Happy sunrise. With that, we are adjourned.