Budget Committee - Regular Meeting

Where if people aren't renting, then the rent will probably, you know, the rental costs will go down, but in an environment where we don't have the supply that we need, we need more units.

And this is where you need to talk to the state individuals, your elected officials, because if you don't do something about the cost of rent going up, then they will truly be forced to a nursing home. If you want to shoot your budget, shoot yourself in the foot with about the budget, try to, $100,000 a year, I mean, you know, The federal government pays a lot of that, but still can take a lot. So you better take a long look at the long, long haul picture of that because it could be very, very much more negatively impactful to your budget than trying to actually increase. And I understand landlords have to make a living and I don't begrudge that, but to what extent is, you know, fair for those individuals. So it's something they really need to take a look at, because if they don't have a roof over their head, they're going to be going state custody or something like that. So it can be a lot more costly.

For so long we've looked at this as like what can we afford to do? How much Section 8 can we afford? How many low-income housing tax credits can we afford? How much design change can we afford? And at some point the conversation has to be what can we afford not to do? Like what are we giving up if we don't do these things? And it's increased nursing homes, increased emergency room visits, increased homelessness, stagnating economies. The city of Austin took a different approach and they built, built, built. And their rents are going down, down, down because they increased their supply. So that's something that we all have to keep in mind. And that means not only do we need the funding streams and all of that, but people need to welcome housing into their neighborhoods.

Congratulations.

All together, Team Kentucky came back with 39 medals, including for the basketball team, flag football.

We represented eight different sports for the state of Kentucky.

That's right.

Came in doubles for silver, and bronze I came in for team and bowling.

I did my best ever. I got 100 and something one game, and then I couldn't crack 60 in any other game. Wow, that's amazing.

I'm here to meet Mayor Greenberg.

USA Games, yeah, it was my first time. Amazing, I got to experience going to Fan Fest, going to the different sports that were there, like black football, basketball.

I just really enjoy playing basketball and watching basketball. I competed in the 2026 Special Olympics Games in Minnesota. I had a really great experience for me to go and have a good time and especially make memories too. So I just really did enjoy it. So I'd love to do it again.

It takes hard work, determination, grit,

I'm just really glad that I get to meet the mayor. So this is my first ever time I've been to, well, I know this is most everybody's first time going here. So I'm really excited about it. So it's just a good opportunity, good and fun experience to do this.

He knew I played basketball in high school, and I really liked sports, so he's like, we got this Special Olympics thing going on, so he wanted me to kind of come out and see what it was like. It was going to be out of my comfort zone a little bit, but I was like, that's what college is all about, so I decided to show up and try it out, and I've just enjoyed it ever since. So I'm a unified partner. That just means I don't have any disability, mental or physical, so I just go out there and it's an opportunity to play with athletes and then get to meet their families and just play different sports. At the end of the day, all these athletes, they just really love sports, and that's why they get into it. And some of them play at a very high level. So many people during my time up there, even from Team Kentucky, I've met a lot of people I hadn't met before. So it's a lot of lifelong connections that I'm super glad I got to be able to make.

My whole life I had goals and one of my goals was to own my own home before I turned 30. I really wanted to jump on it this year since I'm 29. I have four kids, a nine-year-old, a three-year-old, and one-year-old twins. I was with Healthy Start and I told my caseworker at the time that I was interested in owning my own home and she connected me with the Louisville Urban League.

She originally reached out to the Financial Promise Center with the hopes of becoming a homeowner. I started working with her. So day one, we're looking at her credit. We're looking at her budget, her income, what's coming in, what's going out, assessing where things are financially, what barriers may need to be overcome to get to that destination.

We'll go ahead and start with the check first. OK.

getting to the table today, you know, to get into the closing table.

$25,000 to help with your down payment assistance. Made sure that my credit was where it needs to be. Debts was paid off that I had. So after that, it was maybe April or May is when I was like, I'm done with getting everything together. And I wanted to start the journey of applying for a home loan.

Metro TV, 30 seconds, please. Good evening. Welcome to the regular meeting for Government Accountability Oversight. I'm the chairperson, Councilwoman Donna Purvis. I am joined in chambers today by Councilman Piagetini, Councilman Reed, Councilwoman Betsy Rui, Councilman Herndon, Councilman Owen. I'm joined virtually by Councilwoman Jeannie Marie Woolridge, my co-chair, along with Councilwoman Tammy Hawkins and Councilman Bratcher. We have a quorum, okay. The first on the agenda today is MSD. I understand there's time restraints, so I'm gonna go ahead and let them go first. Mr. Parrott, are you all ready for your presentation? For the record, everyone speaking, please identify yourself.

Kelly Watson, General Counsel for MSD.

Good afternoon, Mr. Chair, Mrs. Chairman, and the committee. My name is Tony Parrott. I'm the Executive Director of the Metropolitan Sewer District. And I want to thank you for the opportunity to tell the MSD story and to comment on the proposed changes to Ordinance 50.24. I just want to introduce a few of my team members that may be addressing questions as well as they come up with me alongside my general counsel, Kelly Watson. I also have our chief financial officer, Mr. Brad Good. Raise your hand. Mr. David Johnson, our chief engineer, our chief of staff, Dr. Carmen Moreno-Rivera, and I think we have a couple of our board members here, Mr. Gerald Joyner, who is the chair of our finance committee, and Mrs. Linda Schuster, who is on our personnel committee.

Is there any board members that I missed?

Okay. We were asked to come and talk a little bit about the changes to Ordinance 50.24, and the changes would amend the ordinance to decrease MSD's board authority and our independent rate setting flexibility, which would negatively impact our ability to meet state and federal regulations. You should have the PowerPoint and so what I want to do is just kind of run through a few slides and then open it up for questions. In 1946, I want to provide just a brief overview of MSD and our consent decree. MSD was established by state statute as a wastewater utility in 1946. In 1986, MSD and Louisville Metro government entered into an MOU for MSD to assume the responsibility of stormwater and drainage management and flood protection system. The MOU specified that MSD would fund the two services through rates and charges. So I think it's a good point to recognize that, you know, aside from our statutory wastewater responsibilities, we are essentially three separate utilities in one. And the current MOU with Louisville Metro Government expires in 2036. Also, between 1986 and 1997, MSD assumed the responsibility for executing Louisville Metro Council Ordinances, the Hazardous Materials Ordinance, the Erosion Prevention and Sediment Control Ordinance, and the Floodplain Ordinance. MSD performs the duties required under each ordinance independently with its own staff and funding. Because of our vast scope, MSD has multiple levels of oversight. First, in 1997, MSD assumed responsibility for, under KRS-76, which sets the guidelines for our eight-member board, each member of the MSD board is appointed by the mayor. subject to this committee and the full Louisville Metro Council approval. MSD does not participate in that process. Also, MSD must adhere to all applicable federal state laws, industry standards, and ordinances. This means we have multiple and frequent formal and informal meetings with regulators. For example, we meet with the state and federal regulators to discuss issues and other challenges. Specific to our consent decree, we have formal quarterly meetings with EPA to discuss projects and other requirements, and we also have a list of formal written documents we must send based on current consent decree reporting requirements. As far as the details on the history of our consent decree, In 2005, MSD, the EPA, the Department of Justice, and the Commonwealth of Kentucky entered into a consent decree. And at that time, the EPA issued consent decrees to multiple utilities in the Midwest and on the East Coast to ensure long-term compliance with the Clean Water Act under federal law to protect public health and safety. All parties acknowledged the consent decree would likely be amended over time as MSD developed compliance measures. In 2009, the consent decree was amended as anticipated to clarify provisions, timeliness, and projects. In 2016, MSD was in the final stages of completing our critical repair and reinvestment plan, and that plan focused primarily on infrastructure improvements that we needed in terms of operating and maintaining our assets tied to the amended consent decree and also other assets that were not a part of the consent decree. MSD briefed Metro Council on the preliminary findings of the CRRP, and in 2017, MSD presented our plan to address the needs of the plan and the remaining amended consent decree work. To complete the plan, MSD in 2017 requested a 20% increase, and that was not approved. But also during that process, during that hearing, there was several requests that came back to us that said maybe if you phase it in over time. So in 2018, we presented a plan requesting a 10% rate increase over three years, but that was also not approved. As such, MSD entered into negotiations with the EPA in 2019 to adjust the timelines in the amended consent decree to allow us time to complete the work identified in the consent decree and those identified in the critical repair and reinvestment plan. When we went to EPA, we had three main asks. We asked to extend the deadline to complete the waterway protection tunnel because we actually added approximately another mile on that tunnel to go all the way up to Lexington Road. And we also asked for one of the requirements that set the standard for eliminating, capturing, and treating combined sewer overflows in our decree from 98% in a typical year down to 95% now that we had more updated models that we could verify capture. And then we asked for the remaining projects that were identified as sanitary sewer overflow projects be extended out to December 2035. And that was approximately $220 million worth of work to address other priorities that had popped up as emergencies. Number one, was our biosolids project at Morris Foreman and the Paddy's Run flood pump station, which was in dire need to have improvements. And the pumping capacity doubled to protect most of West Louisville and Shively. So when we think about the proposed changes to, there were a lot of things that we were doing In exchange of the requested timelines that we had at that time, EPA required that we put in additional money, $70 million, for critical sewer rehab. Those are for large diameter brick sewers that were caving in under the streets of our city. And we put in an allowance of $25 million a year for asset management so that we could keep on top of other asset needs and adding those two provisions into the consent decree. The EPA also reviewed MSD's 15-year work plan for asset management and enforcement options to ensure monitoring and project completion of previously included projects. Those negotiations and work plans were based on MSD's board authority. meaning when we looked at the amendment and we looked at the financial capability, it was gauged upon our ability to raise rates up to the current authority of 6.9, below seven. And with the approval of the second amendment and the additional work included, MSD was expected to meet the requirements of the consent decree by 2035. So I just wanted to kind of give that background to lay the foundation for the comments specific to the proposed change to Ordinance 50.24. By changing the limit from 7% to, as submitted in June, CPI plus 1%, this would equate to a rate increase of between 2% and 4% a year according to the proposal that was submitted in June. This would change MSD's board authority and essentially require MSD to come before council each year for a rate increase. Now, while we understand the need to keep affordability at the forefront, which we have demonstrated for the past two years, where our board has guided us to stay at 3.9% with the lowest increases that we've had in our district over 20 years, MSD's rate setting flexibility will ultimately cost the rate payers additional money, and I'll discuss that in the future. Also, MSD's budget is driven by capital requirements based on regulatory obligation, construction costs, debt markets, emergencies, and system needs, not just CPI. MSD does CIP work all over Jefferson County, and one of the things that I think is very important is that as we continue to do work and we look out over the next five-year window, there are several major infrastructure projects and programs that would be impacted by the proposed ordinance change. For example, one of the largest projects we have remaining in the consent decree is our upper middle fork tunnel project, which is required to eliminate illegal sanitary sewer overflows. That project would be delayed. This project impacts areas from St. Matthews down to the Highlands area. Also, expansion and economic development in the eastern part of Jefferson County would be impacted. For example, the Floyd's Fork Interceptor Project and any expansion of the Heights Creek Water Quality Treatment Plant or the Floyd's Fork Water Quality Treatment Plant or the Cedar Creek Water Quality Treatment Plant would be pushed beyond the next 15 year window until funding could be identified. We would not be able to update our 70 plus year old flood pump stations. Our flood protection system protects 280,000 people and important infrastructure like LG&E plants, Churchill Downs, the University of Louisville, the airport, UPS, Ford, and most of downtown. Also, Project Dry, which is our drainage response initiative program, would lose funding. Our catch basin replacement program, which is a critical part of our odor mitigation program required by an agreed order with the Air Pollution Control District, would also lose funding. And as far as the catch basin replacement program, I know there were some questions about what kind of progress we've been making with the odor mitigation. This just gives you a snapshot of all the neighborhoods we are inspecting catch basins and the level of replacements that we've had that have really benefited a lot of the odor mitigation. And we've seen about a 16% decrease in odor complaints year after year. One of the largest areas that we are still looking at is the Russell neighborhood. We have about a $15 million projection for catch basins in that area, and that area currently is unplanned and unfunded. So we have made some progress under the APCD agreed order. As we move on, there would be also an impact on services we provide for Louisville Metro government. We would need to evaluate our ability to administer the three ordinances that I mentioned earlier, the erosion control, the hazardous mitigation, and the floodplain. Also, we would need to understand the impact of continuing to provide free sewer service to Louisville Metro, which equates to about $9 million in this current fiscal year. We would also need to consider the financial implications of moving to CPI plus one for our rate setting authority. Ultimately, this change would mean lower levels of capital funding, higher levels of debt, and lower financial metrics, which would eventually lead to a ratings downgrade in our opinion. Simply introducing this proposed change alerts the rating agencies as they have previously identified risk associated with failure to implement timely and necessary increases. Each notch of a ratings downgrade is estimated to cost ratepayers an additional $10 to $20 million in interest costs depending on the bond market. So the next two slides really just kind of shows you comments that we have received from two of our large rating agencies. The first one is from Moody's, where they believe that rate management is worth about 10% of overall scorecard, as they evaluate us every time we go out to the bond market. and the length of time to implement a rate increase is embedded in the score, noting utilities that require outside approval may face delays, objection, or partial denier. From our 2025 report, factors that could lead to a downgrade are identified, which are significant increase in debt to revenues, substantial decrease in coverage during one and a half times, or liquidity that falls below 300 days of cash flow on hand, and failure to implement timely rate increases or to meet the consent decree guidelines. We included the, for S&P, we included the full ratings report in the packet for you to look at. But for S&P, they already view the 7% cap as a negative already. And then in their 2025 ratings report, They stated that in their view, the MSD governance factors have increased risk as rate increases above 7% must be approved by the Louisville Metro Council and the risk is somewhat mitigated by the district's board who have had the ability to still approve rate hikes up to 7%. The highlighted numbers are some of the key financial metrics that we look at, our CFO looks at every year. And I mentioned the one and a half times rating metric. That is a metric that we are currently predicting for our current fiscal year budget as we implemented our 3.9% rate increase. The fiscal year 27 rate supports those financial policies and mirrors the recommended levels by the rating agencies. Based upon the latest rating report, we think that if we go below the 1.5 times, that will lead to a downgrade. The other area I think is for clarity is our oversight. The oversight for MSD really is impacted when you think about the proposed change to the ordinance. The oversight and the impact of the consent decree are connected with that change. The ordinance change means the board authority would shift to Louisville Metro Council. As such, Louisville Metro Council would become a party to the second amended consent decree and would need to oversee MSD's budget development process in order to change the second amended consent decree to reflect the ordinance change. Louisville Metro Council would need to go to a federal judge and meet with EPA to update the second amended consent decree and extend any timelines as required. Given the scenario that I discussed, there is certain language in the second amended decree that I wanted to make sure that everybody is aware of that would be triggered by any change to the existing board authority. Namely, section 58 of the amended consent decree is shown here. And that's in your packet, and you can read that. But I'll break it down a little bit further. What this means is MSD must use its best efforts to seek approval for anything over 7%, which is current board authority, or CPI plus one, which is the proposed change. If the rate increase request is denied, MSD must notify the EPA to explain the justification for the rate increase, its best efforts, and why the increase was denied. The cabinet, which is the State Commonwealth of Kentucky, or the Department of Justice and the EPA can exercise its authority to force approval of all necessary rate increases in the event that the denials and enforcement continue. So, in essence, that means that the regulators could have oversight over MSD and Louisville will lose our local authority and oversight. And as previously stated, we understand affordability is an issue. You have appointed a board that takes affordability very seriously, and we have demonstrated that in two consecutive years by holding the rate increases at a very lower level. We consistently engage with the state and federal government to develop policies, secure grants, and go after congressionally directed spending to keep our rates lower. We also use a diverse portfolio of options such as our commercial paper program and rate stabilization fund to lower our rates. We will continue to pursue grant funding and low interest loans and other avenues as we focus on affordability for the future. About seven years ago, we were borrowing 95% of our capital need. Because of the formula that we've put in place with our commercial paper program, now we're down to borrowing anywhere between 70 and 74%. So we're trying to be, formulatically setting up a way to put us in a better position with our debt service. And it is projected over the next five years, even though we'll be issuing more debt next year, that our overall debt service payment is going to be pretty similar to what it's going to be over the next couple of years through 2035. So I just wanted to provide this information to you. And we appreciate the opportunity to explain our position and hope we have provided some clarity on some of the questions and some of the issues. And we know that this is a very complex issue and probably needs a lot more dialogue. But with that, I'll end my comments and take any questions.

Thank you, Mr. Perry, you provided us with a well comprehensive information. I do have some questions myself before I move to my colleagues. It is my understanding that if we go to the consumer price index plus 1%, this will have a negative impact on some of the projects that you're trying to complete with the agreement for the consent decree, is that correct?

Yes, ma'am, that is correct. Actually, what we have on the books right now, we would not be able to do the work that we've already consented to do with a CPI plus 1%. So if that is the authority, we would be coming to you asking for a rate increase higher than CPI plus 1% just to complete the work that we've already done. Work we've already committed to.

Okay. And you're saying that S&P, I already acknowledged it, 7% is really low. Is that correct?

Well, what they're saying is that they're really troubled by the fact that we have a controlled board authority or controlled ability to raise rates to the level where we need to. They have been following this historically from our critical repair plan that I pointed out those two years where we did go and ask for more and we didn't get any traction. So they've been following us for quite some time. And one of the things that I think they're pointing out to us is that we set up the plan because that wasn't the first option they gave us. They wanted us to get all the work done in five years. And we told them based upon our board authority we could not do that. And so they consented that we could stretch it out to 2035 as long as we are in compliance with everything that we've done. So S&P and Moody's, I think, will be watching to see, okay, if we do not get what we need, number one, will that result in a downgrade? And ultimately, will that make interest rates higher as we continue to borrow and finish out the program?

So right now, the consent decree goes to 2035.

That is correct.

Would this push the consent decree past 2035?

Currently, what we've consented to are projects that are supposed to be completed by 2035. The one thing I can tell you, and I've told a few of these members of the committee, The Clean Water Act is sort of the umbrella for us, and we don't have any control over future regulations. Whether we are gonna ultimately be required to do nutrient removal at our Morris Foreman Treatment Plant, which is the largest plant in the state, or whether we'll ultimately have to do reduction of PFAS in wastewater and in sludge, those things are being debated at the national level right now. If those things come to fruition, they're gonna be billion dollar tickets. And you cannot do those in a very quick manner. You've got to work with EPA and deal with a schedule to get those projects done. But everything that is a part of the current second amended consent decree should be done by 2035.

So is it my understanding this would affect the operations? which could result in fines to the agency.

Basically, there are two ways that we, under the consent decree, that we can be impacted. Number one, will we stipulate penalties if we miss milestone days for projects? And then if we also are not meeting guidelines for our asset management plan, or we are not doing the adequate reporting that we're supposed to be doing, all of those can lead to stipulated penalties. The other challenge we have, is if we are not meeting permit at our operational facilities, that's another impact on the back end if we don't get the improvements that we need to meet our discharge permits to the Ohio River.

So you have gotten some pretty major projects completed as a result of having the ability to go to 6.9 without getting approval from the council. You still have major projects in the works. As you mentioned, I think St. Matthews, Highlands, and Floors Fork. Okay, so what happens with those projects? If you're in the process of completing these projects and it goes to the Consumer Price Index plus 1%, what happens with these projects that you are currently working on?

In my opinion, I think that automatically, if that's gonna be the board authority, I mean the level of authority that we have, two things are gonna happen. Number one, like I said, we're gonna be coming to you every year asking to go above the CPI plus one. And then we're gonna have to inform EPA that that changes our ability to meet the timelines that they have laid out for us because every project that we've programmed was based upon the 6.9% board authority. So it's gonna trigger, the language itself I think is going to trigger a amendment to the consent decree again. because particularly the project that I mentioned for the St. Matthews area, which is a very large tunnel project, right now is probably estimated close to $400 million. And we will not have the financial capabilities to do that project. We would have to ask for an extension on that project.

Okay, thank you, sir. Councilwoman Hawkins? Councilwoman Hawkins, we cannot hear you.

Councilwoman Hawkins?

We'll go to Councilman Scott Reid.

Thank you, Madam Chair, and hopefully we'll get to Councilwoman Hawkins in just a minute. Thank you, Director Parrott, for coming, and we had a nice talk on Friday. And I just wanted to be very clear to everyone that this isn't a tribunal, nothing like that. We're here to learn. I think one of the problems that we have in the community is that people just legitimately don't understand year to year increases. They don't understand consent decree. And that's really what I'm gonna focus on. My questions are gonna be about the consent decree. Because when they look at their bill, they see that and it's a big percentage of their bill. And they think, well, it was supposed to have gone away in 2020. Still hasn't gone away as it's here forever and ever. So Jared, are you able to get that up on the screen? And I'm sorry. I'm not trying to boo you. I just want to pull the consent decree up. So just one more before Jared enters this in. Explain what the consent decree is and how it came to be to begin with, please.

The term consent decree, I know that people think that that is a specific term in terms of consent. We talked a little bit about that, but it's essentially a tool that the EPA and the Department of Justice uses to quantify and verify that every party or any entity that is a part of a regulatory solution agree on what everybody's responsibilities are. thus the term consent agreement. And so most of the consent decrees across the Midwest and in the East started back in the early 2000s. And the primary focus was on treatment plants to make sure that we could shore up larger treatment plants and get rid of multiple smaller package plants in our community. And if you all may recall, Jefferson County had hundreds of package plants and those have been ultimately eliminated and now we have the five major regionals that we have in Jefferson County. The second part of the focus from the federal government was to look at how we could address combined sewer overflows. A lot of major river cities have combined sewers, which were sewers built to handle waste from homes and businesses and also carry stormwater directly to the Ohio River. Most of those systems were built back in the mid-1800s. And they were large diameter brick sewers. And they were designed to fill up. And when they were filled, if the rain was too much, it would overflow into creeks and streams. So the first phase of that for the combined sewer overflow program was to make communities commit to reducing the amount of annual combined sewer overflows that they had in our community. and to be able to capture that overflow via storage facilities or tunnel facilities and then ultimately get that overflow to a treatment plant and treat it at a certain level. In our case, most of the combined sewer overflow that we are capturing with our tunnel project, our storage projects are taken to Morris Foreman and that's where we're committing to meet the 95% capture And just with the tunnel project alone, we've been able to reduce combined sewer overflows into the Ohio River and Bearcrest Creek by over six billion gallons a year. And then the second part of that is going to be the sanitary sewer overflows, which are systems that are separate from stormwater. And under the Clean Water Act, those sanitary sewer overflows are illegal. Combined sewer overflows, we try to commit to a certain level of capture and treatment. Sanitary sewer overflows, you're supposed to tighten up the system and completely eliminate those enumerated SSOs, as we call them, and most of those are outside of the Watterson. Most of the combined sewer overflows are inside the Watterson.

Okay, so for those that may be watching, a consent decree is an agreement made with the federal government to make sure that we're abiding by the rules and the laws that a court a federal court sets forward. Is that correct?

That is correct. And one of the challenges, one of the things that is very clear in a consent agreement, if beyond just the stipulated penalties and the civil fines and those type of things, there's also accountability for directors or elected officials or whoever are a party to the decree if you are not doing the work that you could be subject to criminal prosecution. And so we take these very seriously. In our case, it's actually a three party, four party agreement with the cabinet or the state of Kentucky who partnered with EPA and the Department of Justice to bring this case against us here in Louisville. Okay, thank you.

So I'm gonna reference, perhaps Kelly may wanna come up to talk to this. Paragraphs 17 to 21 envision that events outside of the consent decree terms can impact the timing and ability of MSD to meet the consent decree terms. And all parties anticipate the consent decree may be further amended. As of now, does MSD anticipate additional unmet needs requiring another extension of the consent decree? Or does MSD, as of right now, that the consent decree will be complete in 2025 or sooner?

I can address that. Based upon what we know today and what we've committed to, what we've outlined through 2035, we expect that our work will be completed and we will meet the requirements of the existing consent decree. Now, there is one caveat. And this is more so for the combined sewer overflow, or what we call in our industry the long-term control plan for the CSO, the combined sewer overflow. There is national discussion, and we have already started talking about it in Kentucky as well. The EPA is starting to say, well, yeah, you completed your long-term control plan, you met your 95% capture and treat, but we're still not seeing water quality standards in streams and rivers. And so that is something that we are just listening to and we're watching. So once we get to the goal line, are they gonna say, hey, we want you to try to do or squeeze something else out of that? Our argument would be is because we're a POTW, a Public Owned Treatment Works, we're under permit, yeah, they're gonna use that leverage against us, but we know that ultimate water quality standards have to be met by addressing the runoff. and the indirect runoff from other communities that may be attributing to some of the water quality issues in the streams and rivers. But to answer your question, based upon what we have signed onto and based upon what our current board authority is, we anticipate that this work will be wrapping up in 2035 unless there's some future regulations that we can't foresee right now. Okay, I understand.

Yes, ma'am.

the beginning of the amended consent decree document items like one through 30, the whereas clauses are kind of like the context and the background for where we are. So it sets the stage and it's telling you why we had a consent decree to begin with. Then it goes in and it tells you why it was amended, which is what you were looking there, like 17 through 21, like all the things that we said we were already, MSU was doing and had completed at that time. adjusting the project timelines, as Mr. Perrin has suggested, and then it goes on to tell you further in those clauses why this amendment was also necessary, if that makes sense.

It does. Okay. How are the completed programs and schedules set forth on pages 18 and 32 determined?

I don't know the actual schedules. I'm going to defer to experts on that one. But as I said, when you're getting through all of those in the very beginning, 18 through these whereas clauses beginning with 18 is telling you basically that in 2015, this is where we said we were. This is where the material change kind of occurred. that we needed to do projects that were critical to the system as well as continue to work on the required consent decree projects. So beginning in 18, it's telling you we needed to work on the biosolids project that Mr. Perry focused on. Beginning in 2019, it's telling you we needed to do some flood protection system projects. Beginning in 20, it's telling you that we were also needing to work on some other system critical repairs that needed to be done. all of that leading to where you are in section number 22, if you wanna scroll down a little bit, where it tells you on page 10, where it's gonna tell you where we're looking at all the other measures that were in our long-term control plan and our other IAOP modifications that needed to be done, if that makes sense. So all that's still more background, starting in 17 is leading to why this was amended again. Does that make sense? Please jump in if I mischaracterize any of that. MSD, okay.

So it might be helpful, and I'm gonna cede the floor to my colleagues and probably come back in if we have time. It might be helpful if there was some sort of document that shows where we started in 2005 the projects that have been completed under the consent decree, what has been planned and where we are in those projects so that we then can go to our constituents and say, look, this was the plan, this is where we're headed. As far as we know, the consent decree isn't here from now until doomsday because people see just this annual increase every year. I think that it would help you guys with PR. It would help us relate to our constituents, and I think it would be a good situation all around if we could come up with something like that. Do you think we could?

Well, I think that there's probably a document that we've already prepared when we went into the Second Amendment discussions with the regulators. So it would be a matter of just taking a look at that and see if that needs to be something that we can provide you. And then maybe it's something that we can update a little bit based upon the last four or five years since we got the Second Amendment.

Because I don't think anybody argues that we want clean water. We want, we don't want flooding, we want the essential services of MSD, right? But sometimes it's difficult to convey that to our constituents. Just to convey the need, I mean, or convey the mechanism to get there.

It is a very complex issue. And when you start dealing with regulators and attorneys, but I'm saying attorneys and Sometimes we have to think about what are they actually asking us to do. Okay. Thank you.

Madam Chair, may I just add to that one little bit? I'll come back into the queue for my own questions.

Who is this?

This is Councilman Kramer. I'm sorry.

Sure.

Thank you. As you put together that list, Tony, I'm sorry, Director Parrott, as you put together that list, would it be possible to include also the changes to the goalposts that have been put in place since the original consent decree? I know we've been making efforts towards it, and I know the EPA has come back subsequently and said, oh, yeah, by the way, We also want you to do this. So I'm not as interested in the speculative piece, although I'm not opposed to your sharing it. I know the EPA is talking about PFAS, but that's not before us right now. So again, if you want to add that, that's fine. But I'm more interested in when we signed the consent decree in 2005, these were the expectations. between 2005 and 2026, there have been additional expectations. And so as you're putting that list together for Councilman Reed, if you could delineate where those additional expectations were added, I think that would help us with our constituents as well. Absolutely.

Thank you.

So I wanted to make a comment Councilman Cramer, in the statement he made, I've heard and I don't know that money's allocated for certain projects under the consent decree were spent in other areas. Can you confirm if that is true or not?

What I can tell you is that the only shifting of projects that we have done is what we've talked about today, which is shifting the sanitary sewer required projects, and there's probably 19 or 20 of them. For about $220 million, we moved them to the back end of the schedule so that we could do the work at Morris Foreman Biosolids and at Paddy's Run flood pump station, and other work at Morris Foreman under a state agreed order. Collectively, the work that we did at Morris Foreman and at Paddy's Run is approaching $600 million, and so that's why we had to shift the original schedule for those sanitary sewer projects to the back end so that we could address, in our mind, which were emergencies.

Yeah, I'm sorry. I don't mean, I hope it didn't sound like I suggested that you moved money away from consent projects to something else. That was not what I was saying at all. My concern question is, I know that when we entered the consent decree, there were a list of things we were expected to do on whatever schedule that was. Since we started work on that, the EPA has come back and added to the list additional things that we're now also responsible for doing. I'm interested to know when and how often has the EPA come back in after the fact and said, oh, yeah, you're already doing this. but now you have to do this as well. That's what I'm asking for. I just want a list of when that happened. We had no implication. You've moved running around at all. This is not a comment about MSD at all, right?

No, I think the original consent decree in 2005 contemplated that there would be a First Amendment, which happened in 2009, because once we got some certainty on some of the metrics, But this Second Amendment was sort of a mutual approach to how we were going to address emerging priorities and what the state wanted us to address at Morris Foreman. And so we can identify those projects. The two things that I mentioned that was added in by EPA was dealing with the large diameter pipe failures we were having and also the annual asset management allowance that they wanted us to make sure we were reinvesting in systems. But we could try to put together a narrative that folks could understand.

Thank you. Councilwoman Hawkins.

Thank you. First, thanks, MSD, for being here. And just for the sake of time, all the questions that I have, I'm going to email them to you all and you all can answer. But I just have one thing, and you can have anybody answer, Mr. Perry. For all those constituents that have contacted my office, you know, and that have concerns just about the, you know, it's been a lot of rain, the catch basings, still a lot of flooding going on in Park Duval. The signage has still been put up after about 10 years. I just want to know, what do you have to say to everybody who's watching? because you know our constituents who depend on us to be their voice i want to know um what you have to say to them um just on behalf because they don't understand the consent decree they don't understand um you know the reason that you all want to continue to raise rates and they want us to fight against that so i want to know what you you know what What do you all have to say to them? So they have hope that you know that there will be some change.

Thank you for your question. And, uh, you know, it's it's a challenge when you think about, you know, when you identify flooding, you know, is it overland flooding? Is it is it street flooding? Those type of things. I can tell you that, uh, particularly in the park Duval area, uh, Over the last five years, we've made tremendous changes on how we're addressing overland flooding in Park Duval, and we've invested a lot of capital and changed out a lot of catch basins in Park Duval. We don't see, unless there's a problem with the coordination with the water that's coming off the interstate, we don't see a lot of overland flooding there. we have uh continued to look at the catch basins in that area i think in park duval we've actually inspected and replaced all the catch basins in the area not only for for flooding but also for excuse me i don't want to interrupt you but we don't just got to talk about park yeah i'm just giving you an example yeah yeah yeah but but park duval is a huge problem it's been for over 10 years

Every last predecessor that I've had all the way leading back to Ms. Green and even before her, it has been an issue right there by the community center. There's no signage, there's nothing. All I'm asking for, if it can't be fixed, just at least, Show some signage so won't nobody get hurt. Because eventually, and I've been sending emails and emails just talking to Ms. George about signage. You know, if we can at least, you know, put some preventative measures there so no one gets hurt. You know, I don't want to have to, you know, go to a sign company and go put some signs there myself. But I'm going to have to do what I'm going to have to do to stop people from getting hurt right there. So we want to make sure that that doesn't happen again. And just what you all can say, because I'm all talked out when it comes to what you know how can make the public understand on why you all continue to ask for raises and i do want to say thank you because when i called you all you all came out to a district that was not mine and made some constituents understand about those catch bases so i want to say thank you about that but um just whatever you all have to say i just hope everybody's listening

Well, the one thing I will add on the signage issue, we are going to be working in conjunction with Public Works, because I think they are the ones who put the signs up. And then secondly, just as an explanation, we know, at least it seems like this year, we've had high intensity rain events. And sometimes we do have clogged catch basins. That's a problem. We have identified hot spots in the area where we try to do a pre-storm event run to make sure those catch basins are not blocked. But then sometimes we get that five or six inch rain event per hour. and the water may pool in the street, but once the system recovers, it's usually gone after an hour and a half or two hours. But if there are areas that are impacted longer than that, obviously we wanna know about it and we wanna take a look at it and see how we can make it better.

Councilwoman Hawkins, are you done?

One more thing and then I'm done and I appreciate y'all coming. The communication. When the public calls in, there was some huge concerns just about the first line of communication. You know, when people are calling in about their catch basing. Because I'm trying to educate people on one end that clean your own catch basing. You know, a lot of times when they call in, it's always, well, that's not us. You know, do constituents have to call in and say, hey, my catch basin hasn't been cleaned out? Or do I just need to tell them to clean it out themselves? Or just to help out? Is it in rotation? What is it? You know, can you help me out with educating them on what is the best route?

our direction would be is that if you know that there is a catch basin that needs cleaned or a catch basin that's clogged, you should notify us so that we can respond and do that work.

Okay, Councilman Piaccettini.

Thank you, Madam Chair. So a couple things. First of all, I believe the last two years, the board agreed to increases less than the 6.9%. Isn't that correct?

At least for the last two years, and it may have been a couple years in the last five years.

Right. So we don't need the 6.9%.

No, that's not what we're saying. Sorry, let me rephrase.

I'm not asking a legal question. I was asking a financial question. Since the board did that, what they're saying is financially they don't need 6.9% every year, correct?

No, what the board looked at was a capital program where we have deferred significant capital projects because we knew that we could not afford to do them, which would have probably driven us way above the 6-9. We have been getting a lot of heat from the community, from the state legislature, as you know. There was language introduced two years ago to try to reduce our board authority as well. And we went up and had a lot of discussions with the state legislature, just like we're doing now. And the issue is that we know that affordability is an issue. And so our board has directed us to look at how we can keep rate increases at a moderate level, unless it is some regulatory driven issue that we have to address. For example, in this year's fiscal year budget, we eliminated 35 positions. And we've also looked at other programs that we are no longer gonna fund. That's how we got down to 3.9%. But the capital program is suffering significantly because we are trying to be cost-effective.

Well, I wanna be very precise here. You say it's suffering. You said a moment ago that you're going to meet the requirements by 2035. So how could it be suffering?

Well, there's projects that, and Mr. Johnson can probably speak to this, but there's projects that we have on our books that have been pushed back for several years. And when we look at those projects, we're doing the concentrically required projects. but there's other projects that we just cannot afford to do, and I mentioned the Floyd's Fork Interceptor as one example. That project, you know, we would love to get that done, but we can't afford to do it. So we're looking at significant deferrals of projects and improvements, and... It's almost like the rusty bucket. We're still playing that Band-Aid role where we are fixing what we can and trying to control our capital investments.

so first of all i would be careful to threaten that we'd slow down growth in the east end if we did this because you know don't don't uh don't tell the east end they can have a good time because i think most of the residents out there would appreciate the slowdown but what i'm simply trying to the picture i'm trying to paint here is we can't have it both ways right um we either have a dire picture and we need the 6.9 and we need the 6.9 every year otherwise we'll be out of compliance or we don't need it, right? And it seems to me we don't. I think we've evidenced we don't. Like, I'll give you another example. In your timeline, before the Second Amendment, you came to Council with multiple requests, at least two, for a much larger increase. They were denied. The consent decree allowed actually states that the federal government, if you in good faith come to the council, the council rejects you. If they think that is out of compliance, they can mandate the rate increase. They can just override and mandate the rate increase. That didn't happen. So that means that the EPA is basically saying, like, hey, we're out of compliance by denying those. And then we get the updated, so there's a renegotiation. Again, you didn't say it was renegotiated because we denied that. You said it was renegotiated because there was new things that came up we had to incorporate. Okay, fine, that happens. I'll address that in a minute. And then now, and again, you could say affordability, that's fine. I mean, look, I appreciate it being lower. As a matter of fact, the current rate increase is just about CPI plus 1%. So if we had initiated this, you actually would have gotten the rate increase you wanted without even coming to us for a vote with this updated ordinance. So I'm just saying it's hard for me to justify saying it's dire, we need 6.9%, when in multiple instances, we have not done the 6.9%. And you've said we're in compliance, right? You might have delayed things, but we're hitting the 2035 deadline. The EPA has not said that we're out of compliance with the consent decree. The court has not said we're out of compliance. The state has not said so. So I'm struggling with that.

Yeah, well I think there's two things I wanna say. The language that you're referring to in terms of the denied rate increase language, that did not exist when we brought the two options in 17 and 18 to Metro Council. Secondly, I would say that when we are looking at controlling the rates, we also know at some point we're gonna be edging back closer to 6-9 because of a bond issue. For example, next year we'll be going out for bonds and the rate is gonna be higher than 3-9. And we also know once this Upper Middle Fork project gets started, we're probably gonna need more than that. So we haven't been able to, we set the schedule and the financial capability based upon our board authority. So we're trying not to go over 6-9.

so thank you so um and so a couple things first of all i this is why um i i think consent decrees are a horrible horrible horrible thing and much rather frankly the epa just said hey we're going to find you or we're going to have some other penalty or whatever and then we continue to deal with it right because then we can continue to do so locally now we have multiple layers of federal and state bureaucracies not doing anything really you guys are doing the work the local entity is doing it's not as though the state epa or the federal epa are coming in and doing anything they're just looking over your shoulder and and you know being annoying they're not adding value for example i would ask you and i think we discussed this the other day but i want people to understand with all of the moving of the epa standards and all the additional things they're doing how is what is the federal epa or state environmental protection agencies done to help fund those unfunded mandates what's the trend line that you've seen in 20 years

Well, unfortunately, the trend line has declined. 20 years ago, maybe 30 years ago, you could almost, for a mandate, you could almost go after 75% federal grant. Today, you'd be lucky to get six to seven percent of a federal grant for an unfunded mandate. And I'll just share one more statistic with you. NACWA, which is the National Association of Clean Water Agencies, predicts that all across the country, utilities are raising rates just this fiscal year at an average of 4.4%. And it is projected over the next five years that it's gonna, all utilities are gonna, because of these programs, the local cost of service and the regulatory cost of service is falling on the local rate payer, and it's probably gonna average up to 6.8% over the next five years for local rate payers. So we're doing our job to advocate for more grants. We know that's the answer. Low-interest loans are good, but we want free money. And so our board authorizes us to spend a lot of time in Frankfurt, a lot of time in D.C., trying to get free money.

Well, I don't call it free money. It's taxpayer money at the state or federal level. But the point is, if they're going to make all these mandates that may or may not work for this jurisdiction, then they need to come up with it. I mean, this is part of the problem. If you got rid of the federal EPA, I don't think the citizens of Louisville will be like, well, to hell with it, let's have dirty water, right? We would just organize locally and say, we're gonna hold MSD accountable, but we're gonna do it at a local level and make sure that we're discussing this, right? Obviously with federal waterways, with interstate waterways, that's where the federal government kicks in. but I see them more and more as a complete impediment to progress and just a massive cost center as opposed to somebody that's actually helping us try to, and I think that's something the public needs to understand. They keep moving the goalposts. That includes extending this consent decree. Now it's going to be a 30-year consent decree without doing anything to support how we get to a solution. My last question here is, you somewhat make the assumption here, both in your comments and in your financial projections, that we will reject all rate increases. In other words, in reality, we could pass this ordinance, it could be CPA plus 1%, and you could come every year and be like, look, we need 6.9%, we need 6.9%, and we might approve it, right? I want to understand why that assumption was made and why is it bad, and I'll use the second consent decree renegotiation as an example. My understanding, somebody can tell me I'm wrong, but it is not as though Metro Council had oversight or there was a big public process. That was renegotiated between MSD, the state, and the federal government. But this body is, we do everything online. The public gets access to it. We have to explain ourselves to voters. I mean, part of this is just about transparency. This is a great conversation. You're saying things that I think the public didn't understand. I didn't understand when we went through the consent decree together and said, OK, there's a clause here that says this. OK, well, that means something. so i guess my question is if our goal was really more to say hey we want more of this to go on before rate increases happen so the public understands what's going on and at least can rationalize it is that a bad thing and and why why would you assume we wouldn't grant the 6.9 if the proof is clearly there that we need it

Well, I don't think any assumptions were made. I do know that we were just basing it upon our history of engagement, trying to go above a 6.9%. And the fact that our financial capability for this amendment with the government was based on the board authority. So we thought it was our obligation to assume that if there was a denial, that it would trigger language in the consent decree, which also triggers a domino of us losing local control. And that was the biggest fear that we have.

Thank you. Thank you, Madam Chairman. And Councilman Pagetine, if I can add. Yeah, of course. As Mr. Peyer stated, that the consent decree is based upon the board authority. So if the board authority changes, right, in this case, well, even if it went up, if the board authority changes this, that's still an amendment that we would have to go to EPA and go to the cabinet and say, this is a material change. They would definitely consider that, right? And so we would have to do that. So then that would mean for us to remain with the same authority, let's say it's still, so if you got a glass, right, the glass is full and the board is at 6.9 and anything above that is the council, if it's now CPI plus one, Now it's 2% to 4% and anything above that is council. You all are still now part of our process in approving our rate making, if that makes sense. You now become part of the governance. And that's now a factor. And that's what, not necessarily a denial, but if the board's authority stops here and then we come here, that's not to say no, it's just to say that you're going to say no. It's just to say that you're now part of MSD governance process.

right we're part of it above seven percent the the the issue is 100 it would be a violation of the consent decree what i would expect would happen if we did it just for the public's awareness is that the judge would haul us in and say you're in violation of this either the epa would request it or the judge would do it either one the epa would petition the judge and say look this is nonsense that's the other thing i don't think a lot of people get it's it's not even like us in the state and us in the epa there's a judge now involved that judge has accepted it and we need to convince the judge that everybody's on the same page or not on the same page so what i suspect would happen is the epa would signal the judge the judge would haul everybody in say you're in violation of it you either need to renegotiate or um or the the or we're in a lawsuit where they're going to try to take over and we would be in an actual court case where the outcome could be federal takeover of MSD, which is exactly my point of why I think we need to engage more with our federal partners, our federal delegation, Congress and the Senate. to really work on a relationship with the EPA to see if we can negotiate a way out of this faster than the next 10 years, because I get they want us to achieve these certain things, but all this comes down to federal takeover and micromanagement when, hell, we might say, at this point, the way the consent decree is structured, we can't increase the board's without being in violation of the consent decree?

Well, I think if Metro, either if you decrease the board's authority or increase the board's authority, that is a material change, right? We would still have to make a note and go to EPA and the state to say this change has occurred. If it's lower, and now Metro Council is part of our governance, then it's MSD's board and Metro Council who's actually voting for, and the threshold is lower, it's not 6.9 anymore, it's CPI plus 1%. So if it's CPI plus 1, let's say, I don't know, the board's authority is still lower, it's gonna, that impact, right, whether you pass it every time or every year we come, and let's say it's just 5% or something that the board is now asking for, that difference is still something that we're gonna have to come to Metro Council for, you can pass it, Either way it goes, that's still a material change to this, and we're all in it. I get it. It's a material change. It's a governance issue.

It's a material change if we increase is the point. Yes. That's correct. That's why, look, I privately said it. I'll publicly say it. I don't know which is worse, what we have now or federal takeover. I don't see the distinction. Like at this point, we can't sneeze without getting somebody's approval from the federal government. And it's really, I don't know, which is why, and I don't care if it's MSD or if it's LMPD or if it's any other organization, as to why myself and several of my colleagues here have come out very strongly against ever entering into another consent decree for the rest of our lives. I'd rather take it to court because I think we have we're now in a spiral that i'm i'm actually with director parrot i think his caveat is spot on about whether or not we make it through 2035 i have no expectation this will be over at 2035. i think this will be a 40 to 50 year consent decree if we're lucky uh because there's no way they will not change move the needle again in 10 years So unless a massive grant program comes out and we could fast track a few things in the next two years, which I don't think is going to happen, but I've taken up way too much time. Thank you, Madam Chair.

Thank you for all of your comments. Councilwoman McCraney.

Thank you, Madam Chair. Mr. Perry, thank you and your team for being here. I appreciate your time and this valuable conversation. I want to go back to Councilman Reed's request for that comparison and analysis from you and would like to know, is this information on your website? And if not, could it be a part of your website? And where can I go now to get any type of information that we have talked about today to refer to some of my constituents?

Most of the information that we've talked about today is available on our website. We will make sure that we send pertinent links, et cetera, to make sure you can have that. And in terms of what Councilman Reed requested, it's probably going to be any documents that exist. And then if there's any update to those documents we need to do, that would be available later down the road.

Where on your website should I refer? I mean, is there a section, like there's a list, and I can say go to this and click on this? What is that today?

Council Member, we can send that information to all of you so that you know where you need to go to get that information.

Thank you so, so much.

You're welcome.

Council Member Warren.

Thank you, Chair. It's 6.15, so I'm not going to debate my colleague about regulation and why they're in place and why it matters sometimes that we have oversight. But so how many times in the last five years, or let's say 10, have you guys not come in front of Metro Council because you didn't have to? Do you know the answer to that?

Well, I can tell you that we have been below the 6.9% in the last five to 10 years. We do come before Metro Council when we have a bond ordinance because we have to get your approval to issue debt.

So how many times when you've been under the 6.9%, have we skipped this process? Has that happened multiple times in the last 10 years?

I would say that when you talk about this process, what we have to do now is we have to send notification. Whenever the rate increases above 4%, we have to send notification to Metro Council, which we do once the board preliminary approves a budget. There's a 60-day comment period and we send those letters directly to each council member. There's some people that reach out to us and we have a conversation. There's been a couple times maybe that we've come over and had this type of dialogue. but mostly it's when we do our bond ordinance.

Okay. So I think it's really important that we're having these conversations about affordability, both with wastewater and utilities across the state and energy and other things as well. They were having the same conversation at the PSE right now. So I think these are important conversations to have. And so whether the authority is at this rate or at this rate, I think one of the things I'm hearing is we'd like to be a part of that process. Now we've just had this conversation about governance and whether you have to go back to the the EPA or the Department of Justice and renegotiate the amendment and all of those sorts of things, but I think some of what I'm hearing here is we're hearing it from our constituents, and I don't know how many people are watching this today or how it will be reported in the paper tomorrow, but I think having this conversation when affordability is such a big concern is worth having, whether you're asking for a 2.9% rate increase a 4.9% rate increase, or a 10.9% rate increase. So I think we can figure out where that needs to be, that authority needs to be, but I would suggest that we have this conversation on an annual basis, whether you're getting, you know, issuing new bonds or not, we have this conversation on an annual basis. If for no other reason that We learned something in this room and people listening learned something and maybe a few of the questions that people are asking about, damn, why is my bill going up so much? Maybe some of those questions are answered. So that's all I'll say for now. Thank you all for being here. Appreciate it. Thanks.

Councilwoman Rui. Thank you very much, and thank you, Director Parrott, for coming here today. I've got a couple questions. So first of all, should you not get the rate increase that you've requested, how is that gonna affect the timeframe towards theoretically getting things completed in 2035?

Well, currently our board has the authority to raise the rates to 6.9%. If this proposed ordinance changes that and we're set at a lower level, it's going to cause projects that we've already committed to to be pushed back. and it's gonna change the timeline, particularly on the largest project we have remaining, because we just won't have the financial capability to go out and borrow money. And it's gonna mess with our metrics, as I mentioned before, our debt service coverage, and our cash on hand, all those metrics that guide our, we do not wanna get downgraded, number one. Number two, I would say that it's mostly going to be a timeline issue. For example, if we say a project was going to be done by 2030, it may shift it to 2033. The cost is going to be if the interest rates go up and we have to go out to the bond market later than we were going to, that's going to cost the customers more. But if we get downgraded, one tick on a downgrade is probably going to cost us $10 to $20 million interest over life of a bond.

Okay, thank you. Another question that's been brought up in my office is you have various rates for residential customers versus industrial customers. Would they both be facing the same rate increase?

I have my CFO here and he's probably gonna be the best person to try to explain how our rates are set up for industry versus residential.

Good evening, Brad Good, Chief Financial Officer. Many years we have increased commercial, industrial, residential rates at the same percentage. In the fiscal year 27 rate proposal that our board just approved last month, we had rates designed based on cost of service. So residential rates went up 3.9%, commercial and industrial rates were adjusted at different percentages based on how those customers contributed cost to our system. Some of the rates went down, some of the rates went up.

Okay, well our residential rate customers are the ones who are hurting the most by this. So is it possible to raise the rates to the industrial customers to help offset some of this so that our residential customers are not hurting so much?

Industry practice is to design rates based on cost of service. So customers are paying based on our respective costs to capture and treat the flow that they're contributing to the system. Nationwide, that's the standard practice of how you set rates.

So that's a nationwide standard. Does anybody else do it differently?

Not that I'm aware of.

All right, well, just on behalf of my constituents, I wish you would consider it. And then my last question is, it's a very long range one. So we finally get out from under this consent decree and we've made all the modifications that we need to make, all the changes and the upgrades. And this is gonna go back to Director Parrott. How long is it gonna take to get out of this hole? Because it's a deep hole.

Well, it's definitely a balance, particularly when you think about the monies and the focus we've had on the regulatory side. Our asset management approach, which is how we deal with aging infrastructure, for example, under this current program, we have a 15-year plan that we have identified and we said we're going to fund. And the regulators have to approve our 15-year plan. The aging infrastructure is a challenge because it would take us quite a while, even after the consent decree timeline is finished in 2035, to continually invest in aging infrastructure. The one example I will give you is our flood pump stations. 16 major flood pump stations built in the 1940s and the 1950s. And they all have critical needs. And right now, we've only been able to attack one of them, and that's our Paddage Run station. That was a $240 million project. So we have 15 more to go. So we can only address what we can address when we can afford to address it. And so it's going to be some time.

So what do projected rate increases and stuff do you think is going to look like when we're done with the consent decree and we still have to catch up on all these other things?

Well, I think that once we complete the consent decree, I mean, I think we've forecasted that we want to be down near sort of the 3% to 4% range or lower. But still, we don't have any control over future regulations that may hit us as we move beyond the consent decree.

Thank you.

Okay. Thank you guys for being here with your detailed information. I really appreciate it. I learned a lot. We need to wrap this up. We have some other business to take care of. Item two on the agenda is being held again. The next item on the agenda, the third item is an ordinance amending section 50.24 of the Louisville Metro Code of Ordinance to amend the debt service adjustment. I need a motion and a second. Second. Okay.

Councilman Reed.

We're going to hold this. So, motion to hold, please.

Motion to hold. Can we just withdraw the motion and then we'll just...

Okay. Thank you. Draw the motion, second.

Okay. We will now move to the board appointments. First one is appointment of Sarah Brady to the Affordable Housing Trust Fund Board. Term expires December 31st, 2028. I need a motion and a second, please. Ms. Marlowe. No, Hera.

Keturah. Keturah. Greenberg. Ooh, Miss Donna, it's been six years.

Oh, Jesus. I'm sorry.

Who's the first person?

Sarah Brady.

Sarah Brady, you can come to the... Hi.

Sarah Brady is filling the seat of the homeless community. She is with the Family Scholar House where she is the president of the Family Scholar Works. She manages multi-million dollar state and federally funded grants. She has experience with workforce development, strategic planning. She has a Bachelor of Science in Communication from UofL.

Thank you. Does anyone have any questions for Ms. Brady? No questions? Okay. All right, are we ready to vote on her? All those in favor of her appointment say aye. Aye. Any oppositions? The ayes have it. Thank you, Ms. Brady. The next item on the agenda is reappointment of Robert Blair to the Air Pollution Control District Board. Term expires June 30th, 2029 at 8 a.m. Motion and a second, please. Okay, Ms. Couture.

Do I have to introduce myself every time? Couture Amaro, Greenberg Administration. Mr. Blair couldn't be with us tonight. He had an emergency with his child, but his supervisor Flannery is here. to speak for him. Robert Blair is the RN with UofL out of Metro Council District 18. He has a master's, bachelor's, and associate of science in nursing and is an adjunct professor at Galen College. Welcome.

I'm Flannery Arneal.

I'm the acting director of the Air Pollution Control District and Mr. Blair apologizes but it is back to school time and he had a school conflict tonight so he apologizes for not being here.

I'm sure the previous guest, MSD, was a little enlightening to you in your position.

Yes, absolutely.

Okay. No. Councilman Herndon.

Thank you, Madam Chairman. I just want to thank you and everybody else here. You've stepped forward to serve your community by being on boards and commissions. Thank you for that. And you've endured an hour and 20 minutes of other stuff. Important and necessary conversation, but just want to thank you for sitting through that as well.

Thank you Okay, no other comments or questions All those in favor of her apartment say aye aye any opposition Thank you The next two we will do together the Reappointment of Michelle Gardner to the Anti-Displacement Commission. Term expires June 26, 2029. And the reappointment of Terrance Elliott to the Anti-Displacement Commission. Term expires June 26, 2029. Is there a motion and a second, please? Okay, Ms. Couture.

Couture Amaro, Greenberg Administration. Michelle Gardner is a disabled senior that lives in the anti-displacement area who wants to give back. She lives in Metro Council District 4, and Terrance Elliott is in Metro Council District 6. He is a salon owner. He is a community advocate, eager to serve, and he lives in the area for the boundaries.

Are you Ms. Michelle? Would you like to say anything?

I'm just glad to be here and just be glad to be reappointed. Reappointed. I'm glad I'm here. I just want to say hi to everyone.

Thank you. Sir?

Yes, I'm glad to be reappointed to advocate for people that can't advocate for themselves.

Great, okay. No questions or comments? All those in favor of the reportments say aye. Aye. Any opposition? The ayes have it, thank you. Okay, the next ones will be together. The reappointment of Sharon Bond to the Board of Zoning Adjustment, term expires June 30th, 2029. And the reappointment of Merlin Lewis to the Board of Zoning Adjustment, term expires June 30th, 2029. I need a motion and a second, please. Thank you. Ms. Morrow.

Keturah Morrow, Greenberg Administration. Sharon Bond is in Metro District number five, represents the Planning Commission per the ordinance. She is retired. She is a former Chief of Civil Works Planning Program in Project Management Division of the Louisville District Corps of Engineers. She is involved in the community and her sorority and has been a committed member. Marilyn Lewis is in District 19, retired civil engineer with the US Army Corps of Engineers. Ms. Lewis is a professional engineer and is registered in Tennessee and a member of the Society of American Military Engineers and the Kentucky Society of Professional Engineers.

Would you ladies like to say anything?

Just like to say we appreciate the opportunity for consideration to serve, continue to serve on the Board of Zoning Adjustment. I appreciate the honor of serving on BOZA and being a liaison to the Planning Commission. So again, thanks for your consideration.

Thank you. Sharon Bond, yes.

Ms. Lewis? I would echo what Ms. Bond said. I appreciate the opportunity to serve on the Board of Zoning Adjustment, and I'm willing to give the time to that. Thank you.

Councilman Owen?

Yeah, just as the Chair of Planning and Zoning, I actually watch BOZA meetings sometimes, and so I just wanted to say thank you all for doing it. It's hard work, and it's a lot of work, and so I thank you all for being willing.

Thank you, sir. Thank you.

OK I'll go madam chairwoman. Madam chair yes ma'am.

Thank you for recognizing me. I do too want to say that that is hard work. I often attend the Boza meetings and I watch both of these ladies and they take their task and responsibility very serious. And I think they do a great job in asking the right questions. So I appreciate their willingness to continue in that role. So thank you, ladies.

Thank you, ma'am. Thank you. Council Member Piagetini.

Thank you. Reiterate the same, and always nice to see somebody from District 19. I know it's pretty far away to come in here, but I appreciate you coming in and serving on BOZA. Anything related to the Planning Commission, particularly in our area, it always seems to be super controversial. It shouldn't be, but we really appreciate both your service, and thank you for representing District 19 on the board as well. Thank you.

Thank you.

All those in favor of the appointment say aye. Aye. Any oppositions? The ayes have it. Thank you. Thank you. Thank you. Okay. Items 11, 12, and 13 will all be together. The item number 10 is reappointment of David Green to the Greater Louisville Lodging Management District Board. Term expires May 1st, 2027. The next one is reappointment of Jamie Capisano to the Greater Louisville Lodging Management District Board. Term expires May 1st, 2029. Item number 12, reappointment of Leslie Schaefer to the Greater Louisville Lodging Management District Board. Term expires May 1st, 2029. Item number 13, reappointment of Andrew Blyden to the Greater Louisville Lodging Management District Board. Term expires May 1st, 2029. I need a motion and a second, please. Second. Okay, thank you. Ms. Couture.

Couture Amaro, Greenberg Administration. David Green is filling the seat for properties of 150 rooms or more. He is with White Lodging Services. David has 30 plus years of hospitality experience. She is skilled with organizational planning. I think I should say he. organizational planning and execution, proficient in developing and realizing sales goals through plans and actions that address the market share growth. He has expertise in contract negotiation, developing sales growth, He is skilled in all aspects of the hotel business. Jamie Camposano, who is virtual, lives in District 9. She is in the seat for 150 and more. She is the Director of Interior Design, VP of Operations, and HR for Zio. Zio co-developed a six-story hotel with 170 rooms. Andrew Bleeden is Metro Council District 8, executive of Butchertown Market and Block Properties. He has been in real estate since 1980. He specializes in bringing properties in disrepair back to life and has been recognized as a top innovator for adaptive reuse of real estate. Leslie Schaffer is the general manager for Aloft Louisville East. And I believe that is everybody. Correct.

Is that all of them? That was all four. Anyone in the chambers? Please identify yourselves.

I'm David Green. I'm Andy Bleeden.

You have any questions or anything you'd like to say?

No, council has been backed up tonight in an effort to keep things flowing. I have no questions or comments.

I like you. Well, unlike David, we're going to be here for a while. No, I want to say thank you guys so much. The mayor called me up and he said, hey, I want you to be on a board. And I said, great, fantastic. And he said, well, do you want to know what the board is? And I said, I don't care. I've never been named to a board that's fantastic. But it's an honor to serve, and it's a great board. So thank you guys. Thank you all very much.

Okay. Councilman Owen.

Thank you, Mr. Camposano, for representing District 9 and your willingness to serve. There's a reason Mr. Bleeden has never been nominated for a board before. I'm not sure why it happened this time, and I might let it go through, but not entirely sure. And I apologize for you having to wait for an hour and a half, but I'm happy that Andy had to wait for an hour and a half so he could be here with us.

Thank you. And Ms. Camposano is virtual.

I'm sure everybody is schooled on the MSD process. So Ms. Capasano, would you like to say anything?

No, I just it's been an honor to be amongst the people of this board for the last year. It's, you know, like David and Andy, people who care so much about Louisville and not only, you know, getting heads in beds, but making locals enjoy all the festivities and things that we're bringing to this great city. And I've really I've learned a lot. I've loved the company and it would be an honor to serve again. Thank you.

OK so all those in favor of these apartments say aye aye any oppositions the eyes have it. Thank you thank you thank you. The next 2 will be joined together appointment of Marina Gonzalez to the police merit board term expires June 1st 2028. The appointment of Matthew Beck to the Police Merit Board. Term expires June 1st, 2029. I need a motion and a second. Second. Okay. Ms. Couture.

Couture-Amaro, Greenberg Administration. Marina Gonzalez is out of Metro Council District 23 and is the head of Global Inclusion and Belonging Governance and Compliance with FIS. She is people-centered talent and organizational development leader, skilled with navigating across HR, technology, and business teams to bring clarity, alignment, and large-scale initiatives. Matthew Beck is out of Metro Council District 16 and is an entrepreneur and marketing professional. Attended both Middle Tennessee State University of UofL, and UofL, and skilled in marketing analytics, strategic planning, business development, web design.

Matthew, what college did you go to?

I went to Middle Tennessee State University and the University of Louisville.

Okay, okay. You have any comments, any questions?

I'll keep it quick. I have a five-year-old who starts kindergarten tomorrow, so she's anxious for me to get home and put her to bed, but I appreciate everybody's support.

It's Tony's fault.

And I learned a lot about MSD tonight, a lot I didn't know, so I feel informed. And I also want to thank Councilman Reed for all the work you do in Prospect. I watch our Prospect City Council meetings and see all the work that you do and when you're in attendance, and I appreciate that.

Yes. First of all, I commend you for actually sitting through a Prospect City Council meeting. That shows somebody that is really involved in local government. So thank you very much. And I take it that's your dad out there?

Yes.

Your dad's a great man. Thank you. So thank you. Thank you.

Would you like to say anything?

Just thank you for the opportunity to be able to serve.

Okay. Councilman Owen?

No, thank you, yes, for serving. I didn't think I was in the queue. Thank you.

Okay. If we're ready to vote on these, all those in favor say aye. Aye. Any oppositions? The ayes have it. Thank you. Thank you. Okay. The next one will be handled singly. And forgive me if I mispronounce this name.

Naderica Thibault. Hmm? Naderica Thibault.

I was going to say Tabone. The apartment of?

Naderica Tabone.

Naderica. Okay. Ms. Tabone. To the Riverport Authority Board, term expires July 31st, 2027. I need a motion and a second. Motion. Second. Thank you.

Ms. Thibault is not a stranger to Metro Council. She is the president and executive director of LUMED. She comes out of Metro Council District 22. She has 30-plus years in leading large-scale operational, capital, and strategic initiatives. Prior to LUMED, she was a senior director for clinical effectiveness. Also, she was the director of design and construction plus enterprise program management. She is the perfect fit for this board. Thank you. Sorry, Couture, Monroe, Greenberg administration.

Okay, ma'am. Good evening, everyone. I just wanted to say thank you for the opportunity. It's Naderica Tebow, and you pronounce it the way 99% of people do, so you were right along with most people.

That's French, right?

It is, yeah. It's my husband, not me. Okay. Yeah, so just I want to thank... Wolville River Authority for the opportunity. I'm loving the economic development and all the work that we're doing in Lumet, and so this gives me an opportunity to extend it to the south side of town. I'm looking forward to it, so thanks for the opportunity.

Thank you. Councilman Ornn.

Thanks, Naderica, for everything you do for Lumet and for this board position and being willing to serve the community. Appreciate it.

Thank you. Thank you. Councilman Herndon.

Thank you, ma'am. I agree. A positive and consistent influence in District 4. And your term expires on my birthday in 2028. So it was meant to be. Thank you.

All right. Thank you. Okay. All those in favor of this appointment, say aye. Aye. Aye. Any opposition? The ayes have it. Thank you. Thank you all. The last two will be together. The reappointment of Brian Funk to the Waste Management District 109 Board. Term expires June 22nd, 2028. The next one is reappointment of Kevin Gibson to the Waste Management District 109 Board. Term expires June 22nd, 2028. I need a motion and a second. Okay.

Ms. Couture-Amaro, Greenberg Administration. Brian Funk also is no stranger to Metro Council and is out of District 24, is an independent, and Mr. Funk was the Assistant Director of the Louisville Metro Department of Public Works until 2022. Kevin Gibson is a regionalization director, very involved in the community, experienced in commercial and development projects within the civil and environmental engineering industry, experienced with budget development and control environmental practices, and a dedicated member of our city.

Okay, does anyone have any questions for Mr. Funk? Mr. Funk, do you have any comments you'd like to make?

Sure, just very briefly. As mentioned, I was a former assistant director of public works for Metro government until my retirement. Prior to that, I've been in the public works and parks and recreation business for oh, I'd say, what, total of 30, no, about 40 years now prior to retirement, and a lot of that was overseeing and managing various solid waste functions, both as managing employees as well as managing contractors. So this is a great board, and look forward to serving again.

Thank you. Okay, we are ready. Councilman Oren.

Last but not least, I appreciate your perseverance and thanks for being willing to serve. Thank you.

Thank you. We are ready to take a vote on Mr. Funk. Mr. Funk, thank you.

Sorry. And Mr. Gibson.

Oh, and Mr. Gibson. All those in favor, say aye. Aye. Any oppositions? The ayes have it. Thank you for your patience.

Thank you. Really appreciate it.

All right. Okay, that concludes our meeting. No further business. The meeting is adjourned. Thank you. Hopefully Althea will be back on the 18th. Do what? Hopefully Althea will be back.