City Council - Special Meeting

Good evening. Welcome to this August 19th, 2026 special meeting and work session of the Topeka City Council Governing Body. I'm going to ask the clerk to take the roll, please.

Mayor Duncan.

Here.

Council Members Hiller. Here. Val DiDio-Alcala. Here. Ortiz. Here. Banks.

Here.

Kell.

Here.

Miller. Bradbury. Here. McGee.

Here.

And Hofer? Here. All right. We have nine yes or nine present. Thank you.

All right. The purpose of this evening's meeting is to talk about issues surrounding data centers in Topeka and the surrounding community. Remind everybody, as we've said before, this will be, I'm sure, the first of numerous meetings that this governing body and the Committee of the Whole that was created a few weeks ago to discuss this issue as we work through it in this community. So this is just one of what is to come. With that, we're going to jump right into it this evening. We have representatives to start this off from Compass Data Centers this evening. I'm going to turn it over to them to introduce themselves, present us with whatever material you've brought here to present us with, and then we're going to open it up to questions from the city council. So with that, welcome. Appreciate you being here this evening, and the floor is yours.

Good evening. Thank you, Mayor Duncan, members of council, and staff for making time for us this evening. Mr. Mayor, you recently said that if a company cannot come into a community and explain who they are and what they do, that is going to be a tough sell. I want you to know off the bat that we're not here to sell you anything. I am Brett Collard, the Senior Vice President of Land Development with Compass Data Centers, and together with my colleagues present, We appreciate the time you have offered us tonight. I want to use this time to tell you more about Compass, what we are proposing, what it would mean for Topeka and Shawnee County, and to answer any questions you have. Compass builds Class A, community-first data center campuses for cloud and hyperscale providers supporting online banking, electronic payments, digital health records, shipping, logistics, email, photo sharing, and streaming people use every day. Our buildings house the servers and equipment our customers operate to make those things possible. It's the business we support in every one of our campuses, the same business we would bring to Shawnee County and the city of Topeka. Compass Data Centers was founded in 2011. For 15 years, we have built, owned, and operated hyperscale campuses across North America and Europe, including Red Oak, Texas, Goodyear and El Mirage, Arizona, Statesville, North Carolina, Hoffman Estates, Illinois, Columbus, Ohio, Leesburg, Virginia, Meridian, Mississippi, Toronto, Ontario, and Milan, Italy. We are backed by Brookfield Asset Management, the Ontario Teachers Pension Plan, and KKR, three of the largest infrastructure investors in the world. That ownership structure matters, and here is why. We do not buy land and entitlements to resell them. We do not build on speculation and exit in three years. We own, operate every campus we build. We designed what we call a 100-year campus. The mechanical, electrical equipment sits on the outside of the buildings, so it can be replaced as technology changes without tearing anything down. We expect to be operating in Topeka for decades. Being a Class A community-first developer means the highest standards in how we build and operate match by meaningful, lasting investments in the places we call home. Those of you who came to the open house may have seen the Class A checklist we published that any community can use to hold developers, including Compass, to that standard. Across our portfolio to date, being that kind of developer has meant $300 million paid by Compass for substation, transmission, and grid improvements funded fully by Compass, not added to anyone's utility bill. $277 million invested in community improvements, roads, schools, parks, workforce programs, and a $15 million county-wide animal shelter in Texas. More than 6,400 long-term jobs created to date, with forecasts showing growth to nearly 11,000 as our pipeline matures. Waterless cooling on every campus we have ever built. The proposed campus sits at Southwest 85th Street in Waukarusa area with parcels also fronting Southwest 77th Street and adjacent to US 75. It is inside the South Topeka Economic Growth Corridor, established in 2012, the same corridor that is home to the Walmart Distribution Center and the Mars plant. This ground was set aside for exactly this kind of use. The current plan is designed for up to 10 buildings, built in phases. The buildings are single story, low profile, with the mechanical equipment on the ground rather than on the roof. Setbacks, earth berms, and screening are designed in from the start. The 54.5 acres of floodplain on the site will stay undeveloped as open land. Total investment is approximately $4.5 billion. Construction would run from 2028 through 2031, with full operations beginning in 2031. Before we filed anything, we commissioned and paid for six independent studies of the site. Environmental, wildlife, stormwater, traffic, air quality, and 11 days of on-site sound measurement. All that research gave us invaluable information about how we can build a campus that prefers preserves what makes Topeka special. Every one of them is filed as public record. We did that before anyone asked us to. County staff have asked us for additional detail, which is ordinary for a permit of the size we're providing it, and we will file a supplement on August 28th. So the record is complete and publicly available. Our project would be an economic engine for Shawnee County and the greater Topeka area for decades. I want to share more about how and why. The figures I'm about to give you come from an independent economic study prepared by FTI Consulting, and these estimates describe the first year in which all buildings are operating. What do Topeka and Shawnee County stand to gain? Millions of taxes, more than 700 permanent jobs, roughly 1,700 construction jobs a year, and a long-lasting community benefits program we want written into our agreement. Here's the detail. Taxes. In that first year, the project is estimated to pay about $55 million in property taxes to Shawnee County alone, roughly half of what the county collected from every property owner combined in 2023. and it would continue to pay property taxes every year after that. Schools. The school district receives the other major share. First year school property taxes from this project are more than double the Auburn Washburn USD 437's projected local revenues. The campus would support more than 700 permanent jobs across the Topeka metro area, about 300 of them working directly on the site, and more than $85 million in annual GDP. Construction would support roughly 1,700 jobs across Kansas between 2028 and 2031, generating more than a half billion dollars in labor income. Three of every four construction hires are typically local for our projects. Operations jobs pay 30 to 50% above the average wage, and construction jobs pay at or above prevailing wage. The constraint in our industry is not what these jobs pay, it is about finding enough skilled tradespeople to fill them. We understand Topeka has a wealth of skilled tradespeople and we want to hire them. We also want to help train others. That is why we have begun conversations with Washburn Tech about bringing our MEI data center pathway program to Topeka. It takes people with no prior experience, no degree into generational careers with training and scholarships. We just expanded the program to Mississippi and will soon launch programs in Illinois and Arizona and North Carolina. Compass expects to spend roughly $810 million in Kansas during construction, about $717 million on construction labor and materials, $24 million on other materials and equipment, and nearly $69 million on professional services. That last figure is legal, accounting, engineering, environmental work, and Topeka firms are well positioned to win it. And the work does not stop when construction does. Because the equipment inside these buildings is refreshed on a rolling cycle, when the last building opens, it begins again at the first. One more thing worth knowing. In Hoffman Estates, Illinois, where we are turning the shuttered Sears headquarters into a campus, local businesses have reported a 20 to 30% increase in sales since construction began. Crews, suppliers, operations staff eat lunch somewhere, buy fuel somewhere, and stay somewhere. The tax base is what the project pays. The community investments are what we choose to do. Across our campuses, we have paid $277 million into roads, schools, parks, workforce programs, and the countywide animal shelter. None of it was required. None of it was contingent on an incentive. We do not negotiate special treatment, and we would never make our investments conditional on getting it. Those investments happen either way. We want to invest here too, in both the City of Topeka and Shawnee County, but we are not going to stand up tonight and tell you what Topeka needs. You know better than we do. What we would like is a chance to work with leaders across the community to identify the improvements that would make a real lasting difference here, and then to fund them. Let me take the main concerns we have heard head on. These issues are important ones to understand and to discuss. No doubt many of you hear the same things we do, but you might be surprised at how often we agree. Data centers should not use your water. We agree. Water is a precious resource. Compass has used zero municipal water for cooling since we were founded in 2011. Our cooling systems are closed loops, filled once, and recycled indefinitely. The only water we draw is for restrooms and break rooms, about what 20 homes use in a year for the entire campus. We are not asking for water rights, and we have asked the county to make our water commitments an enforceable condition of the permit. Data centers should not raise your electricity rates. We agree. We connect directly to the regional high voltage transmission. We fund the substations and transmission distribution lines ourselves so that these costs are not added to anyone's bills. Where the utility wants it, we also build in demand response. The ability to pull our load off the grid during a heat wave or an ice storm so homes stay powered first, that makes the campus a shock absorber for the grid. Data centers should not be a nuisance to neighbors. We agree. This campus is modeled below 50 decibels at every point on our property line, quiet than a normal conversation, and below the EPA's 55 decibel residential guideline. An independent acoustics firm did that modeling after 11 days of on-site measurement. When a neighbor near our Northern Virginia campus in Leesburg was bothered by a fan frequency only she could hear, we did not argue. We fixed it and then recalibrated every unit on every campus we own. Data centers should not strain the environment. We agree. Compass is the only data center partner for sustainable development with UNESCO and the first and only operator to hold all three independent certifications covering construction quality, sustainability, and water neutrality. Our generators run on clean burning HVO biofuel. Data centers should create real, lasting jobs. We agree. Our project is estimated to support more than 700 permanent jobs, including 300 directly on site, about 1,700 jobs a year for four years, and the Washburn Tech pathway I just described. It is important to know that not all data center developers are the same. And those differences make all the difference. Some companies buy land and power rights with no intention of building and then flip them. You never may meet those who are involved. Others build on speculation and plan to sell within a few years. They have no reason to invest in your grid, your schools, or your community. As a class A community first developer, we hold ourselves to a higher standard. We have asked the county to put our water and other commitments into our permit as enforceable conditions rather than promises. Commitments that expire the day after the vote are not commitments. We have been encouraged to bring third-party opinions into this conversation, and we'd like to do that by sharing two short videos before taking questions. The first is about water. It is the question we hear most often. We wanted you to hear a little more about our approach from Bob Bocock. Bob ran municipal water utilities in California before he co-founded the Erin Brockovich Foundation. and he has spent his career working for communities on water quality. In the video, you will also hear from Ted Lewis, chair of Goose Creek Association.

Second only to air, water touches all aspects of our life. There's this legacy lie about data center consumption of vast amounts of water. Now historically, buildings were air-cooled using evaporative cooling processes that did use a large quantity of water. Science has gone way beyond that. Like many of my colleagues, I was reading water meters on roller skates in Southern California in 1979. I parlayed that into an opportunity to be a director of drinking water utilities in Los Angeles, and from there had the opportunity to consult on water resource management. I've had the privilege and the opportunity to work in the Chesapeake Bay region for over 25 years. Compass approached me and said, we're a company that doesn't use water in our cooling process. And I, you know, with skepticism said, show me. I think the biggest misinformation surrounding data centers is the use of water. I've conducted over a thousand town hall meetings and I respect the concern of every individual that shows up, but people really misunderstand water. The average community drinking water systems leak more in one day than Compass would use in a year. It's the equivalency of two family households. Here in Leesburg, Virginia, Compass's data center is located right on Goose Creek. Compass went in and made the commitment that they would not only install a 300-foot buffer, but have continued to stay involved in management of that activity, improving water resources and water ecology from Goose Creek to the Potomac River to the Chesapeake Bay.

As chair of Goose Creek Association, I'm not interested in a lot of data centers developing along Goose Creek. However, the data center that Compass has was approved and it was built. They provided a proffer of $60,000 to Goose Creek Association. We used that money to restart our water quality program, but we wouldn't have started any of it if we hadn't had that sort of seed money to get started. There's a lot of debate From my point of view, you guys are here. And so now I want you to be a part of the community helping to preserve these great natural resources we have.

You have to be very selective in the clients you choose to represent and work with. And they have to be committed to making those improvements beyond the development into the community. Compass has done that for me. They've made the commitment and they've continued to go back to those communities year after year after year. and make good on their commitments.

Thank you. The second is from community leaders from three different communities where we have built, some of whom we've partnered with for years. They can tell you what it's like to have us as a neighbor during construction and long after.

We were founded on the railroad. Our greatest, grandest day was probably in the 40s and 50s.

We started in 1959 as a bedroom community to Chicago.

We've been here for almost 200 years and they're not making any more dirt. So before we put a project on it, we're going to make sure it's the right one. Good today and great tomorrow.

We really never contemplated having a data center located in Marina, Mississippi.

Our board, our community didn't quite know what are they, why do we want them in town. That's kind of a big investment, but that could also be a big win for the community.

data centers in a way that are kind of the modern version of the railroad that, you know, brings life back into our community.

The capital investment is so large. Once this property is fully built out, Compass will probably be our largest single taxpayer.

We kept hearing that there are no jobs with these projects. When you have an eight building campus, you're quickly getting to about 300 employees which is as large as our largest employer.

For the six, seven years that all of this is under construction, there's hundreds and hundreds of construction jobs.

We learned pretty early on Compass cools with air or a closed loop system.

It's not a drain on the water at all. They build substations and redundancy into our grid, supporting our infrastructure.

They don't need our public works plowing streets or maintaining any underground utilities.

We would have had to maintain all of that. Compass is not coming with their handouts saying, what can you give us? They're basically saying, how can we help your community?

We've been able to renovate our baseball fields, expanded quality services like parks, police, and fire.

We embraced a data center coming in to have for the next 50 years, for the next 100 years. growing with us as a community.

If you think about what that means to our residents, we're going to have more money to provide quality of life, all the while their tax rate will go down. I love our community and I love what data centers are going to allow us to do to improve their quality of life.

People don't know how great it's going to be. Thank you.

In closing, as our CEO, Chris Crosby, likes to say, that data centers are the railroads of the 21st century. 100 years ago, the towns that planned for the railroad and built around it are still thriving today. Topeka knows the story better than most cities in this country. We appreciate the opportunity to be here and answer your questions and to hear your concerns. This community cares deeply about its future, and we do too. We hope what we share tonight will be helpful as you consider if our project is right for Topeka. We would rather earn your trust than be given it, and that happens by working closely together, keeping our commitments, and being here for decades from now helping build the future you envision for Topeka together. You can hold us to what we discuss tonight, because at Compass, our actions and words are one. Thank you, and we'd be glad to take any questions you have this evening.

Thank you. First thing real quick, could you introduce us to who all is at the table with you this evening?

Yes. My name is Eric Williams, Senior Vice President of Solutions Engineering.

Brett Collard, Senior Vice President of Land Development.

Cliff Pompey, Vice President of Power and Admissions.

And Janice Murphy, I support the team through community and corporate communications.

Great. Thank you for that. So we have a system tonight. We're going to rotate around our questions. And so just so you know, it's going to kind of go in the circle as you're trying to figure out who's asking questions. And if our deputy mayor has to leave early this morning, it has nothing to do with the fact that you're here. It has to do with another family issue she's got to attend to later this evening. So we'll make that very clear also. So with that, we're going to start with the deputy mayor so she can ask her question.

Okay. This one's a little different than probably any you'll hear. I know you're not going to use much water, but I want to ask if you're going to do anything about rain collection because you're going to have a lot of square footage of roof. My shop that I have down by the river, we've run our one saw that has to be water cooled because it's got diamond blades or diamond segments. And over the years, we haven't had to use hardly any water in that shop because it's all come off the roof and been collected in a 13,000 gallon tank. So is there any way that you would consider doing that to save the water? I mean, you're going to have plenty of ground to be maintaining around possibly putting some of it back in the system. I'm just I don't know if you were planning on running it off into a lagoon or what your plans were, because I didn't see anything on the site plan that you had published that really addressed that.

Thank you for the question. At this time, our prototype does not deploy leveraging recycled rainwater for our campus. It is something that we will explore further, and we'll work with our design team to see if it is something that is viable for our prototype.

Because I just hate to have it. going used and it's an important resource to all of us so we want to manage it as best as we can and I wish more people would do that but it's not a common use for rainwater right now. Most of it goes down the drain into our sewers.

Thank you for that question. We will look into it further. Thank you.

Anything else yet at this time? Okay. Council Member Hiller.

to it. How does it work? We're talking about all the things that might go wrong or that people are worried about noise, air, water. How does it work and in particular how much heat is generated and how does the heat, how do you get the heat off?

Yeah, let me address how does it all work. It's a complex system. Data centres are complex buildings. We have experts on site through mechanical, electrical, telecom, civil, structural. So to address the question regarding heat, obviously at a large campus at 400 megawatts at total build-out, that will ultimately equate to that heat dissipated. We do detailed CFD analysis on all of our campuses, so that's the computational fluid dynamics. We do that modeling both internal and external to the facility. That modeling shows that beyond the envelope of the equipment and the building itself, it is practically imperceptible beyond the building envelope and at the property boundary with ambient conditions. So heat dissipates relatively quickly from the facility. It is ejected no different than any HVAC equipment that sits on a commercial building. This one included on the top are sit at ground level. They're all air cooled and that's how they ultimately eject heat. No different from your commercial HVAC units. Residential commercial HVAC units at your home would operate in the same manner.

So So how hot does it get compared to a home? You're pretty high level for everybody. We want to see how this works. How hot does it get inside that facility?

So inside the facility, the conditions are maintained within parameters typically set by the client's IT equipment. So you're operating in an envelope of between 18 and 27 degrees C, somewhere around, call it 75 degrees C. Fahrenheit overall, that maintains the integrity of the IT equipment. So as heat is generated from the IT equipment, that's moved out to the facility loop. The closed loop that we talk about is that heat transfer mechanism that moves heat from the inside of the facility to the outside of the facility, and then it's rejected to ambient on that air-cooled, effectively dry coolers that sit on the outside of the facility and reject heat to the ambient. So in terms of how hot is it inside, it's relatively cool. It would be no different than sitting inside this room today. It is not perceptibly any different from the IT inside the equipment.

Okay. Thank you.

Council Member Valdivia.

Thank you, Mayor. Thanks for being here, and I'm just going to say, I'm not an expert in this, but you guys are, so there's a little bit of unfair advantage there. And it's really hard to read your website because there's just so much information, you know. You would have to be a totally data center scientist, water expert, all of these different kind of expertise. And here we are, little old lay people, city council people. and the community that's trying to get some answers. So with that said, I have a question. It's a two-pronged question, but I have to give a little bit of insight as to why I have the question, because I am confused. When we had some meetings, we met with one of the people that attended this meeting was a big union guy and he said that twenty unions local uh... unions were supporting compass because of the jobs they believe will be created and when i looked at your website and when i some questions to drill deeper into some articles, there was still some confusion that I had. So I'm just asking if there could be some clarity with that. Because when I look at your data outcomes report, it states specifically because you all have such a tight process. I mean, kudos for this process you have. it's tight, it's on point, it focuses very much on a supply chain closely coupled partnership. That means with entities like Caterpillar, that means like entities like Siemens, which handles the I believe the electrical infrastructure, Schneider Electric, Vertiv, R&K Steel, R&K Water. You also go into how important it is, you know, your special cement you have, how important it is to consolidating assembly under one roof. You also speak continuously, when I looked over that report, of reducing labor hours on site. I see that there are some install guides there for subcontractors. And when we talked to the head of this union coalition, his thing was jobs, jobs, jobs. Two Topeka, two Shawnee County, jobs, jobs, jobs. And I know that that is a big thing that even in this video, this 10-minute video, I think that you guys sent us late this afternoon, there was something about 1,700 jobs. So out of this whole labor question that I'm going to ask, Remind me again how many buildings you say that you're going to have for this Compass Center?

Ten buildings.

Ten buildings, okay. And per building, how much local, which by local I am meaning Topeka and Shawnee County, how much of that labor will be used for construction? And I'm asking you to please be specific.

So we're currently, and thank you for the question, we are currently targeting 17 on-site construction jobs for this project. 1,700, sorry. 1,700 construction jobs for this project on-site per year, most of which will be locally hired and sourced. Ideally, all of our contractors, our GCs and subcontractors, we want to hire local as possible.

Okay, but how many of that 1,700? You're saying...

I don't have that exact number at this time.

Well, I think it's important to know. I think that it's important because When we go through this, and, you know, I'm not a big AI user. I just think it's, I have a lot of ambivalence about it. But that seems to be one of the points that keeps coming back to that the expectations on local jobs always, and there are articles attached to this, and I can send those to you as secondary sources, but that it always ends up being lower than what is actually stated. So because you have really important unions that support a lot of families in Topeka and Shawnee County, I think that this is a fair question. And I think that we need to get an understanding because 1700 sounds really good, but it also says on your website you do 85% of your build off-site. And a lot of the technical stuff that has to do with pipes, with electricity, and all of that is done specializations. That's a specialized, it doesn't sound to me, from what I read on the website, that it was somebody that works for the IBEW or something like that that's going to come in and do that work. So it's a fair question. And I don't know if there is also information from your other builds that you have done where you have tracked the number of local labor that you have said you are going to hire during the duration, this is going to be a four year, but other data centers that you have, where can we receive that information to see how this is all worked out as far as How much was actually local labor? How much was labor that you brought in to hang around here for a while, do really important work, right? And then went back home to wherever they came from.

Our relationships with the... you know, with the unions and the skilled trades people of the City of Topeka and Shawnee County will be very important to this job and this project for the foreseeable future. As we commit to the 1,700 construction jobs that will be on site, it will all be predicated on the labor pool that is available today or at the time of construction. You know, we'll be working closely with those groups to identify the right staffing models and hire as many people locally as we can. And we will also be, you know, part of that comes down to that MEI program, Pathways program that I mentioned, the mechanical, electrical and information technology pathway program curriculum that we've developed in partnership with Texas State Technical College that we're rolling out at a lot of the current campuses. because there is a lack of labor supply in many of these regions to support the industry. So we're really excited about the opportunity and working closely with the unions.

But I want to add something to what Brett was saying, because I think there's two categories of labor. And so just let me start with that, and then we can drill deeper. So there's permanent operational jobs, and then there's construction jobs. So based on our experience, based on our modeling, and based on doing an inventory of our estimate of three out of four workers are local is based on inventorying our current staff and understanding who's local and who's not. So that's, again, an average based on our experience to date. But getting back to the two buckets, Again, based on our modeling and based on the economic impact study, there will be 700, we're estimating 700 permanent jobs, 300 of which will be onsite. In addition to that, the 1,700 construction jobs will be an annual amount for the duration of the construction phase. Then as Brett mentioned in his opening remarks, When we finish construction, it's typically time to go back and refresh equipment. So really, even saying that it's an end point isn't accurate. So it is absolutely a great question. We are basing our answers not only on modeling for this project, but also on all the other campuses that we've built and how many. workers we hire and that sort of thing.

And so do you have that data that we can look at from your previous campuses on how many was local, how many were coming in and left, how many were subcontractors? Because I think that that's fair. The labor unions that are supporting you, they're important unions here in Topeka, Shawnee County, and Kansas. So I understand that You know, right at this moment, you might not be having specifics, but it is concerning with what you're saying and what you're telling versus what you see on the website. And I don't know if there was special, you know, special exceptions made because you all want to come to Topeka so bad. But, you know, on your CUP, it was 30 positions. Right? Per building. Per building, right.

So that's the 300 on site.

Right, with the 10.

And then the additional 400 are actually those that support the data center in some way. There's a lot of support services that go along with that. So that's the math in that situation.

And thank you for that. And I think that it's important that we see that math. And I understand after having talked with some labor people, I think it's important for them to see the math. Sure. And, you know, because we don't want the speculation and the high numbers, which I'm sure you guys don't do. No. We want the real numbers because this is the real investment.

So I think, does that take up one question?

I'll let it be one question.

We will get back to you. Okay. All right. Thank you. We're doing fine. Council Member Ortiz.

Thank you. And welcome to Topeka Chambers. Hope it's not your last time here. Okay, so I want to talk a little bit about franchise fees. A franchise fee is a payment a city receives from a utility or private company for the right to operate within the city and use public right-of-ways or other municipal infrastructure. For example, a city may charge electric, gas, cable, or telecommunications providers a franchise fee which is typically collected from customers and remitted to the city as revenue. So I wanted to say that to the people that are listening. And my question is, and I don't know if this is for you or Evergy, we will be discussing annexation in the next presentation. Are you able to discuss how the Compass project would affect franchise fees that Evergy would pay to Shawnee County or the city of Topeka if the city were to annex this area?

It's a really good question, and thanks for asking. And you're right, that would be a much better question for Evergy. But what I can tell you is, to Brett's point, we will pay all of our fair share and what's required to subsidize that substation so that we're paying for it and it doesn't raise rates. I can't talk to the franchise fees. That would be a question for Evergy.

Okay. Mayor, I'm going to ask something just a little bit different, if I may. You're fine. Same thing. I was at a Neighborhood Improvement Association meeting, and since that's for Evergy, I'll leave that for Evergy. And I had a gentleman that was there that talked about building the grids. And do we have enough grids, or are we still building them to handle the electricity that you guys will need? And the reason why I ask that is because One winter, we had a power outage in Oakland because there wasn't enough grids. I had a gentleman tell me that he was working for you guys and that he was building them from Oklahoma all the way up to Nebraska. Is that true?

I don't know who that was, so I can't speak to whether this person was building from Oklahoma to Nebraska, but what I can say, and it's one of the great benefits of data centers, is that in the U.S. 23 years experience working for utilities. I worked for NextEra Resources in South Florida and Duke Energy in the Carolinas for 16 years doing resource planning, which is essentially how do you build the resources for the future to ensure reliable and stable grid. We have a really aging grid in the US. We have not invested the money over the years in our grid. Data centers bring a capital influx to the grid. So in terms of this particular project, There is a substation nearby that's next to the Walmart distribution center that we are planning to get power from in the short term. But in the long term, there will have to be new investment and new build and new substation to feed the site. We will pay for that. And we've done that in other places. So you saw in the video the gentleman from Red Oak talked about how our investment helped the community. So in Red Oak, We donated the land and we purchased the right of way for the transmission in order to build a new substation in the city of Red Oak, which what happens when you bring in a large substation to an area like that is you unlock capacity. So basically, if you want to bring the next project and the next and the next. they don't necessarily then have to go and build 50 miles of new transmission line. So not only are we paying for the transmission and the substation to feed our project, but it will end up making the grid in the general area more reliable.

And that's my concern is that our grids are terrible because like I said, I think they were without power in that snowstorm for about almost two weeks, you know, and It was probably, I see it all the time coming up from Texas all the way to Canada, so that's where my question went. And then, Brett, you said that you guys would power down to make sure that the residents have the electric or whatever they needed. What do you mean by power down?

I can take that one as well because that's in my opinion.

I didn't get your name. I'm sorry.

My name is Cliff Pompey.

Cliff?

Cliff.

Okay. Yes. Go ahead.

And what we mean by that is typical grids are built for the entirety of the year, all 8,760 hours. However, certain times the grid is stressed, when it's 100 degrees outside or when there's a storm or something like that, the cold winter mornings when everybody's running their furnace and everything else. In those cases, we will voluntarily, if asked by the utility, we will voluntarily disconnect from the grid during times of stress to de-stress the grid so that retail and residential customers don't have to get into brown-out situations. So we will go on backup generation if the utility asks us to during those times.

Thank you. Thank you, Mr. Mayor.

Council Member Banks.

Thank you, Mayor. Thank you. for coming and letting us have a chance to share and exchange information. My question to you is one that's being asked all across our community and that question is in your study of the environment for in those places where you have data centers What effect did the data center have on the environment, both the land, the water, and the air around that area?

Thank you for the question as well. From our lens, in our 15 years of existence, we've never seen any negative impacts on the environmental status of the site or the surrounding area. As I mentioned earlier, the studies that we do in advance, our technical due diligence is not only for COMPAS, and for the community, but it's also for our employees that will be working on that site for the foreseeable future. So we need to ensure that everything, every risk has been mitigated to ensure that it is a safe working environment and that there is no potential risk to the community, to Compass, to our employees and our customers.

Thank you, Brett.

Thank you, Mr. Mayor.

Council Member Kell. I'm going to start off with, I emailed Brian Feedman, a VP of Development, community at Compass on July 28th with no response. I have a hard time wanting to work with someone who states they want to be in open communication but not want to reply and not want to put something in writing. That was kind of my big moment right there was you say you guys want to be open, and I got zero response back from two different email addresses. So it wasn't like, OK, it was missed here. one person, then with that is why do you want to build in Topeka slash Shawnee County where the citizens have been very vocal about not wanting you to be here and why not do this project in one of the rural counties of Kansas, five of which have a population of 1% or less of Shawnee County?

Thank you for the question, and I do apologize that that email was not responded to or that we missed it. That was not our intention. I think, you know, the open house that we had hosted a couple weeks back was hopefully that first step in being able to share our story and how we perform as a Class A community-first developer. To your question, so why Topeka? Topeka has ample long-haul fiber along I-70. The site itself is nearby the Evergy transmission distribution substation. There is transmission distribution lines, high-voltage transmission distribution lines, already running through the campus. That's what made it an exciting opportunity for Compass.

Speaking of your water earlier, you say, is there anything you add to the water for its longevity or anything like that? And then if so, what's the environmental impact if there's a leak? And what is the plan for the water after it's ran its use?

Yeah, so thanks for the question. So water does go under, so the standard water that we do use, all through existing either wastewater facilities or industrial sources if available. Once it's filled into the system, there is what is called a flush and fill process. That goes through a passivization depending on the chemistry of the loop and depending on the makeup of the loop and what it's made of. Standard biocides and anti-corrosion are added to those. Those are on the website, I believe, under the Topeka page. You can see them. They were part of our open house as well. They are not unique to a data center they are common industrial chemicals added for anti-corrosion and biocides just for the safety of the water. There is routine tests done on it so people do interact with the with the water so that's for safety protocols. Nothing that we have on site is ever rejected into a wastewater facility down they never goes down the drain never goes through a storm water that is all collected Once a fluid, we anticipate long-term availability of that fluid inside the pipes. It can last indefinitely as long as the chemistry is maintained. If it gets to a point it does need to be rejected for any reason, that goes back through the supply chain from which it came, from a wastewater facility or to an industrial source that picks it up, but never goes down a drain, never goes into a stormwater system. Thank you.

Council Member Miller.

Thank you, Mayor. I appreciate y'all being here to answer questions this evening. As a quick follow-up to what he just said, you said that that water is getting tested. Who tests that water?

So we have third parties that come in and do that. We have Vertiv who supplies our cooling equipment through Nalco and Ecolab. They are contracted in our facilities to perform that testing. Also, customers require us to do testing, sometimes on a monthly cycle and on a biannual cycle to make sure the chemistry of the water is safe, not only for heat rejection of the IT, but also just good cleanliness as people interact and test the water systems. So we do have third parties that come in and do that, and those are part of our ongoing maintenance protocols. Okay. Who do those third parties report to? So they would ultimately be under a commercial contract through Compass, but ultimately it would just be through a negotiated contract directly.

Okay.

My, this question for this round, I guess we say, thank you for that follow up. But I've heard a lot about taxes going down. And I'm very curious about that. And I see you grabbing the mic, it must be your specialty here. So in my curiosity, I don't see anything to where taxes actually go down. So is there some documentation to that? And I want to hear from somebody who doesn't have anything, respectfully, who doesn't have anything to gain from it happening.

I understand the question and thank you as well. I'll say that the property tax revenue that comes from this project is estimated around $165 million per year if it's included inside of, if it's annexed into the city of Topeka. That would be

So 165 is just the county.

Correct.

Topeka, if annexed, would be an additional $42 million a year.

Correct. And those taxes will provide the opportunity for the authority having jurisdiction to fund improvements to infrastructure, schools, school salaries, teacher salaries, emergency services, that money will be allocated to the authorities of a jurisdiction to allow them to use that money as they see fit. Now, whether or not there is any kind of budget shortfalls or surplus will decide and will allow the jurisdiction to make a decision on whether they can lower taxes. We have seen jurisdictions leverage data center development to reduce and or completely eliminate property taxes in some jurisdictions like Coventry, Georgia.

Thank you. So there there is a place that has documentation of taxes either going down or zeroed out. Yes.

Yes, and I think you could also add Loudoun County, and I think if you Google it, you'll see the coverage. They talk about it very proudly. They have, for a number of years since data centers came to the neighborhood, been able to, they chose to reduce property taxes for several years in a row, and there's lots of coverage out there talking about it with third-party validation that you're asking for.

Okay. Sounds good. I hope that Shawnee County would do something like that.

Are you against lower taxes? I'm going to let that one ride.

Okay. All right. Okay. Thank you.

Council Member Bradbury.

Yes. Thank you. I have a question that I'm going to be asking from a constituent. What specific legally enforceable commitments are you willing to make to prevent the data center from increasing our community's noise, water use, electricity costs, traffic, and environmental burden? And what happens if you fail to meet those commitments?

Thank you for the question as well. We understand the concerns around many of the topics that we've discussed tonight. As we mentioned before, we're willing to insert these agreements or considerations into the agreement that we make with Shawnee County and the City of Topeka. You know, for us, water, again, is a very precious resource. We don't use it for, we've never used municipal water for cooling, period. We are also always focused on leveraging the 55 DBA boundary line that the EPA writes into their code. for sound. And then for our campus as well, we're always interested in ensuring that downcast light is added to our campuses that we need for security purposes, but that there is no significant impact to light shed. And these are the types of things that we have done in our data center developments since 2011.

And I'll jump in and answer the question you asked about the electricity rates, because that's something that's very important to us. And we agree that data centers should not raise electricity rates. As we've talked about previously, we've always paid for our infrastructure upgrades. But the thing about data centers and large loads in general is that If you think about maximizing something that you have, you bought a car and you drove it for 10, 12 years, you've put all the miles on it, you've gotten all your dollars worth. When you invest in the electrical grid, you want to sell as much electricity as possible to get all the mileage out of that electrical grid. Large loads help utilities get all the mileage out of that electrical grid. And in a lot of areas that have large loads, especially data centers, Georgia, especially in other areas, they have seen a downward pressure on rates. That doesn't mean that rates are guaranteed to go one way or another. There's a lot of things that go into rates, but even in areas where electricity rates have stayed flat, large loads have been the reason why they're able to stay flat as opposed to going up or going down specifically because of large loads and maximizing the mileage that you're getting out of the grid.

Thank you for that. I have an additional question in regards to the environments. Looking at the EPA website, it looks like there was a violation filed, a documented violation filed in January of 2025 and March of 2026 for the data center in Virginia. Can you speak to that? Sure.

Yes, I can. And thanks for doing the research and asking us the tough questions. That one was a very specific and unique situation. There was, if you remember the summer of last summer when the heat wave went through, and there was some failures of grids and substations across the country. Our data center experienced a failure of the substation, the utility substation. We ran on backup generators for a period of time. And the violation that you see from in Virginia was essentially a clerical error in terms of how the Virginia Department of Environmental Quality was assessing our emissions and what our actual emissions were. We've worked with Virginia DEQ to get that rectified and they have since accepted that we did not violate our permit.

So does that speak to those multiple violations or is that just a single one or help me understand?

If you could help me understand the other violations.

There are, what I'm looking at now shows notice of violation on February 27th, 2024. Notice of violation on May 7th, 2024. Something else that says administrative formal on January 21st, 2025. Notice of violation on August 21st, 2025. And then something else that says administrative formal on March 16th, 2026.

I would have to go back and look at each of those to be able to speak to them. So we'll take that action and get back to you.

Thank you.

Council Member McGee.

Thank you. I think some information or conversation has changed since when we looked at your sign boards before. Because at that point, we were talking about trucking some water in and trucking wastewater out. And it doesn't seem that we're talking that way tonight. And we're still talking about, you gave the example of HVAC system, and I know that evening we were talking about a closed-loop system being like a radiator on a vehicle. Very similar. But even like a radiator on a vehicle, occasionally it has to be flushed. So you have to do something with that water, that wastewater. So my question is, will it be trucked out and where will it be disposed? Now, at that time you were talking about trucking it out and disposing it. Somewhere, I believe this evening earlier, you said it would go to our wastewater treatment facility. So can we get, I'd like some clarification.

Yeah, thank you for the question and let me clarify. So just with respect to the community boards, we are absolutely still talking about trucking in and trucking out water. We are not any consumers of the municipal water sources for our cooling. The only water source that we use is for domestic sinks, restroom facilities, break room. That is the only water usage that we have as per the conditional use permit filing. So just to reiterate, we absolutely will for the facility loop from a cooling mechanism That is water that we would obtain from either a wastewater facility or an industrial source if available. That's the water that we talk about from 125,000 gallons in part of the flush and fill, 55,000 gallons per building retained in the loop indefinitely. So that is trucked in and trucked out. With respect to what's rejected, the facility loop can be maintained indefinitely. As long as we maintain alkalinity, pH, proper biocides, there's no reason that that fluid cannot be indefinitely maintained. There are scenarios where a degradation of a coolant fluid gets beyond the point where its pH or alkalinity can't be maintained. In those situations, it's highly dependent on the amount of cooling the facility receives, so it's hard to quantify when or if that is ever required. If it is, those are absolutely trucked off. They never go down any wastewater, never go down any drain or into the stormwater systems. They do not go back to a wastewater facility. They go back to the appropriate plant or recycling facility able to handle that.

That's one more? Yeah, absolutely. This will be a different line of question. I was listening to the talk show on the radio over the weekend, a national show, and they were talking about data centers, and they said that some are being built. I know you're a private company. You can disclose what you want and not disclose what you don't want. But they mentioned that there are some of these being built without a specific client at the time that the construction begins. My question is, does Compass have a – I mean, we don't know who you're building this for. Do you have a contract with a specific client now, or is this being built on a speculative basis?

Thank you for that question as well. So we work with the five largest global cloud and hyperscale customers in the world. They are the largest investment grade customers in the world. We do not have a specific customer of those five in mind that we build for our prototype. provides a capability for them to use our prototype for their services as they see fit. So it allows us to go ahead and start construction, work with the utility to ensure that we pay and contract under our name and then are developing the campus for any one of those certain customers. Again, they are the largest customers in the world providing our services that we use every day from office applications, email services, banking, medical records, et cetera. They are customers that any community would be proud of.

Thank you.

Thank you.

So I'm not going to keep you here double the time we had talked about, but I would like to ask for a little grace this evening to give council members another opportunity to ask some follow-up questions to what they've heard. Absolutely. If we're good with that, I'm going to keep going. We're good. Thank you. Make sure we're all on the same page as we go forward. So thank you for that. I know Deputy Mayor's leaving, so before she goes, I didn't know if she had anything she wanted to... All right. Thank you. Council Member Hiller. Council Member Valdiviacola. You're fine. We have time.

On further research, now that you brought up the EPA thing, Michelle, Councilwoman, that was the EPA? Is that correct? Yes. I also find one in Arizona. There was no fine air pollutants. Is that true?

I am not familiar with that either, but we will certainly investigate it.

I've got some details. That Arizona one was essentially a missed filing. So it was not a air pollution issue. It was a filing and I think it's a monthly filing that we just missed a deadline.

Okay. So the being on a monitoring compliant enforcement is not true.

Can you repeat that one again, please?

States that you're on a monitoring, no fine, but you're on a monitoring enforcement.

I'll have to check more into that one and get back to you and make sure we're giving you all of the relevant details.

Okay, because both of these it sounds like are air pollutants. So, and then the other question that I had, when it comes to the $4 billion or $4.5 billion investment, this actually did come from a number of constituents that were kind of all going in the same direction with this because They want to, and I want to as well, get an understanding of the $4 billion investment. What makes up that $4 billion? So I'm just throwing out, like, you know, land, buildings, and other taxable real property, electrical, mechanical, generators, cooling equipment, et cetera. And I'm asking this because those categories do not necessarily receive the same property tax treatment. Obviously, a $4 billion capital investment is not the same thing as a $4 billion taxable assessed property. So the specific questions are we know that this is going to be a four-year build, right? That's what you're saying. I'm sorry? At a minimum. At a minimum. And how many phases is it? I'm sorry, I might have missed that. How many phases? Is that the four-year, a phase each year?

It's more around the timing of which the buildings can be structured and the capacity that's available via averaging.

Okay. Oh. So it might not be every year. But I mean, you have phases, but it kind of depends on a lot of different variables when your phases actually start. Is that correct?

Yes, we would be working with our partners at Evergy to ensure that we have available capacity to support the buildings that we lease to our customers. On average, I would say we're delivering at least two full buildings every year, if not more.

Okay, and this is an attachment, Spencer. You're fine. You have time. It's okay. So looking at your phase one, when will that become taxable?

I would need to look at the exact load ramp and plan that is available today. But we would love to be able to start construction as soon as possible. Obviously, we would need to go through the permitting process, get all the proper approvals, start site works, and then be into vertical construction as soon as possible. Once we get to foundations, our 270,000 square foot shells can be erected in less than 40 days.

But we have a moratorium, so you're saying, like, if that stays in place after that. If. I said if. So you would like to start the phase one as soon as possible, and you're not sure when it would become taxable. So what if future phases never occur? Because there has been some talk of not so much a bubble, but... something like a bubble, to where forecasters are saying something referencing a looming soft landing, to where spending may be pulled back. The immense amount of spending could lead to low vacancy rates, et cetera, et cetera. So what is your plan with caring about the community and coming in and having this 100 years? You know, what if the future phases never occur? What if the belly-up happens to some regard or the softening happens? Then what?

To date, I've never seen that in my seven years at Compass. I would say since 2019, demand has grown exponentially quarter over quarter, and it's continuing to grow at the rate because of how much – data and compute we need on a daily basis. Every person in this room is using more and more handheld and connected devices on a daily basis inside of our homes. I think the number since 2018, the average family home had about seven connected devices. And now we're approaching 25 or more. And if you have two children like mine, we have a lot more in the house than that. But the demand is far outpacing the capacity that is available today. Our customers that we work with I would say those estimates that we have been providing are likely conservative, and they are asking for as much capacity as quickly as possible.

Okay. So you don't know, and I just didn't pull this out of a hat. I mean, look, there is forecasting speculation in a number of data center realms, in a number of, it's even talking about different articles. Again, I can send you the secondary sources. But they're the ones that are talking about soft landing. that could occur between 2026 and 2028. So I was just asking, you guys seem really prepared in everything, run a tight ship, have all of your I's dotted and your T's crossed and everything. So I would imagine that what if scenarios, even though they can lead to a lot of bullshit, I mean, sorry, BS and anxiety. I am sorry, I did not mean to say that. A BS and anxiety, but there's also a practical nature to that. what if question. So I'm throwing that out and requesting a response.

Yeah, we'd love to take a look at your secondary research because it's hard to know exactly what you're referencing and of course you can read just about anything these days and lots of different places.

On any kind of website.

Right, yeah, so happy to take a look at what you're looking at and provide a point of view. Right, thank you.

Council Member Ortiz.

Okay. No one wants emergencies or bad things to happen, but they do. What is Compass's plan in the event of an emergency? This is a large facility, and if things happen, it will happen on a large scale.

Thank you for that question. For Compass, this is a 24 by 7, 365 mission critical facility, not only for Compass, but for our customers. It requires five nines of uptime. That's 99.999% uptime. operations and monitoring are paramount as well as safety for our campuses. Safety is number one in our company's purview. We are constantly monitoring and ensuring that we are far exceeding any safety protocols to ensure that every risk can be mitigated.

Okay. I think this constituent's concern was that our fire station outside. And how is it going to handle that? I'm just saying that to my colleagues, you know. Okay. Thank you.

Thank you. Council Member Banks. Thank you, Mayor. My question is going to be to Eric. And I reference Eric because in our last encounter, we had an opportunity to talk a little bit. Anyone that knows me know I don't talk a lot at this council or any other committees that I sit on. What concerns me is that if you've noticed, many of us have been looking on our phones as we were talking. And that's an indication that people in the community are texting and asking us questions. So I'm going to ask if there are assurances that you can make if we decided today to say, okay, we're going to have a compass data center. Are there assurances that you can make to us to take back to the community that you're going to be committed to what you're telling us or what you're proposing for us?

So thank you very much for the question. Yes, we did have an opportunity to connect at our open house. I would say through continued community engagement, both through additional details that we plan to submit on the 28th, anything that we put down in writing, We would encourage thoughtful consideration of all of those provisions and anything that you feel is a conditional that you would like to put us a commitment on, we are absolutely willing to put a commitment on. From anything we say technically, everyone sitting here at this table today doesn't need to go back and confirm what we can commit to. If we commit to it in writing, you can probably hold us accountable to it and ask us through, again, continued dialogue, whether it's technical or whether it is something related to community development or otherwise. So it is absolutely, we will stand behind what we put down into our reports. If there's questions on it, we're happy to submit additional details, follow up and make sure it's absolutely abundantly clear. And if there's anything that you feel needs a written commitment beyond what we've provided, we're willing to stand behind it.

That... community meeting we had out west a few weeks ago, one of the members of your team said they would be sending us those poster boards and is that still something that's going to happen? Because if we got those, that would give us an opportunity to share with our NIAs and NA groups to help further the information that we want to get to them.

Yes. In fact, I'll just jump in from a communications perspective. All of the boards, all of the communications, the Q&A, the questions that we received at the open house and beyond, the answers to those questions, the video that provides the overview of the project, which I know we talked about at the open house needing to be included, all of that is on the website now. And if you want to write this down, it's compassdatacenters.com forward slash Topeka. And that's a page that you should definitely, and we will do a better job. I will say we should have sent you a note to say this has been posted. So if you want to, we just wanted to make it available for everyone. But the boards are there. Everything that we... have been asked to provide and we made a commitment to provide that night is posted as the update now. So if there's other things that you think are still missing or if there's questions that you feel like we need to add, please just let us know and we'll be happy to continue making that a better and better site for everyone to get the information they need.

Thank you. Thank you Mayor. Councilmember Kell. Okay. Have any city of Topeka, Shawnee County, or state of Kansas political seat holders or employees signed a non-disclosure agreement, NDA, or any other similar document with your company? If yes, who?

Not to my knowledge, no. Okay.

What does the effect of placing your data center have on the adjacent property value? And that's right next to it and also probably within, let's say, two miles.

Thank you for that question as well. From what we have noticed, we have never seen a degradation in home values related to any properties near our campus. In fact, in many jurisdictions, the housing prices have actually, the home prices have actually gone up. There was a recent study done by realtor.com. I don't have the exact number in front of me, but that confirms that there is no, there has been no validated degradation of home values.

And I think if you want to look at the, that's a very recent report. The realtor.com did a study with a range of zip codes to look at that issue exactly. And it is in the Q&A that's on the list of questions that we address. And it's sourced with realtor.com, so you can click on that and go right to the survey that they published.

And then finally, you talked a little bit earlier about the, human side of things where a person had a problem with the frequency of the fan. Has there been any effect to the environment through wildlife and or farm animals because there are a few farms out that direction and has it affected any let's say we have a lot of migratory birds in this area and butterflies and other things like that that use this route through our area. Has that affected any Have you seen any effect to those processes?

No. And at Compass, to date, we've never noticed or had any filings or submissions indicating that there has been an impact to wildlife. Many of the jurisdictions that have data centers in them very recently are in more rural, agricultural-based locations. And we have never seen or heard of impacts to wildlife since.

But again, just to add to that, that is an area that we study. You know, every community that we go into, that is an area of study. So we want to do everything we can to preserve all the things that make Topeka wonderful. And so that is an area of study that we take seriously.

Council Member Miller.

Thank you, Mayor. And to answer the question, yes, I want property taxes to go down.

Okay.

But something else you talked about with your clients. You said you represent a lot of big players in the world and a lot of the computing that they do and the data centers that they need, right? It was the et cetera that bothers me and a lot of people in this community when it comes to the other things that may be happening at the data centers that you're building. I am not smart enough to know about all the ways that AI and surveillance are done. That's not my wheelhouse. I know it's all over the world, but I don't represent the world. I represent this community. I'm proud of that. I don't want their health in decline because we are propping up the surveillance state that seems to be happening around the world, more than likely our country. So I would like Compass to be on the record right now to speak to the type of liability that you hold for the surveillance state and whatnot that may be happening around us.

Thank you for the question. I would start by saying that, again, I may have misrepresented it with a comment of et cetera, but I will say that our customers operate and provide services that we use on a daily basis and that we continue to use on a daily basis. That's inclusive of medical records. schools, school systems, online banking, all of the streaming services, and all of our office applications that we use on a regular basis. I can't speak specifically to the surveillance state that you're referencing, but we work with companies that we are proud to partner with.

Okay. Okay. Seven years, you're good at that. I got that. Okay. Okay. Well, I imagine this won't be the only conversation we have. So, thank you, Mayor. Council Member Bradbury.

Yes, thank you. There's been a lot of talk about how much property tax would be coming to communities. However, Senate Bill 98 also provides for a 20 year sales tax exemption for data centers. Can you provide the projected 20 year tax exempt purchase totals for each phase in building

So just to confirm, you're looking for what the Senate Bill 98 reduction or the exemption would provide?

And how much you expect?

I personally do not have that information calculated at this time. It is something that we can work with our FDI consultants. But at the same time, I think the value of what the state of Kansas has brought with Senate Bill 98 is to incentivize the opportunity for data center development within the state. And it does bring about a reduction in sales and use tax for, you know, computer data center equipment, but it does include, it does bring opportunities for world-class developments that can give significant revenue that other industries at this time cannot provide.

I get that. I'm just asking for the projected amount.

I don't have that information right now, but we will certainly look it up and see if we can provide an estimate.

Thank you.

Council Member McGee.

All of my questions have already been asked, so I'll pass.

All right. We're probably getting towards the end. Pardon? Do you have one more burning question, Council Member Valdivia? I'll let you ask it. That's not a criticism. Council Member Harlow, do you have a follow-up?

Okay.

It's really accurate. You can ask it. I just want to make sure.

Well, I was just going by my time for you, ma'am. No, you're good. You're totally fine. You're fine. Okay. Kind of picking up on Councilman Miller's question, and I don't know if he's going in the same trajectory that I'm going, but I... read and was very disturbed with the article in the Capital Journal. My straight up question is, well, and I will say that it states that Compass and Tel Aviv were involved and I think still have some kind of relationship and it gives links to where it looks like it's being verified to me that the surveillance, military surveillance information of Palestinians in the Gaza Strip. I would add to what Councilman Miller is saying because in the meetings that I have been to, again, what he is saying is fact. People are very concerned about surveillance in Shawnee County, in Topeka, in Kansas. But there is also the deep concern that we have heard by many of military type surveillance and being involved. in what many, at least the UN has classified, a genocide. So I guess I want to just reiterate more than ask you all that there is great, great concern. And I know people laugh it off. Not you all. I don't see no smiles on your face. I'm not saying you all. People have laughed it off. People have said it's not pertinent. People, you know, it doesn't have anything to do with anything. But it does. Because there is a moral compass that's involved in there somewhere. Or not. And what he is, Council, Councilman Miller is saying is the fear of the surveillance state. You all don't know, but we're getting a lot of emails about the flock camera systems. So it is stirring in this city before you all got here and came to the table. But the article was very disconcerting, and I don't know how much military intelligence, military surveillance that you all have had historically, but I am just going to say with the number of folks I have talked to both within my district but greatly outside of the district, there is deep concern on the business that may or may not have been conducted by Compass and your partners. Thank you. Thanks, Spencer. I mean, Mayor.

Any other final? Council Member Kell.

Have you or will you lobby for any tax breaks after the completion of construction?

I'm sorry, can you repeat that?

Have you at other locations, or do you plan to lobby for any tax breaks after the completion of construction? Because it's one of those things, you can sit there and say you're going to provide 65 million to the county, possibly 42 million to the city, but you can go to the state and have that... wipe very quickly by lobbying state representatives.

No, sir. At this time, there are no exemptions or abatements that we will be seeking as it relates to this project. One thing I would like to cover, I know it wasn't a question, but I would like to address that TCJ article that was unsubstantiated We are not familiar with that. We will confirm that we did build three data centers in Israel for a large global hyperscale customer. We had minority investment from 2019 to 2023 from an Israeli real estate group called the Azraeli Group. So we did work in that city or in that country. Ultimately, we had divested those assets to the customer as of 2025. Thank you.

All right. Now I think we're... We do thank you for being here. It has been much appreciated. I'm going to say two things as we wrap this portion up. First is just the community. As we said, this will be the first of various conversations, not just with Compass, but with other stakeholders in the community. I think everyone's seen that we've taken steps to make sure we can continue to have those conversations. I also want to remind folks that there are other things we're looking at. As you saw, our planning commission is looking at certain zoning laws and just making sure those are cleaned up because moving forward, that's a best practice. We are working just like the county is on putting together some sort of impact study, and that is moving forward, and we're working with our sustainability board to have input into that so that has citizen input into that process. It's not just us. dictating how it's going to go. They'll also be part of, several of their members will also be part of the process to select the company and be an integral part of that. So those are just steps we are taking as we continue to listen to the community. I'm going to leave you with, I think, you can take this as advice if you want. You know, I was born just down the street. I'm probably in that direction. I'm probably going to be buried just down the street that direction in this community. I am a Topekan through and through. I tell folks, this community is my friends and my family, and they don't all love me, and that's the nature of the beast. But not just as being one of them, but also as being their mayor, I will fight for them every single day, right, whether I'm in this seat or not. My mother also grew up in this community so we are here and we are not going anywhere. I know this community well. I know the people in this community well. I sit in rooms with them where they pat me on the back and I sit in rooms with them where they want to push me out a window. And I will tell you sometimes those conversations where they want to push me out the window are the most productive and informative that I have. We don't always end up agreeing on something, but we find some common ground that lets us continue to have those conversations moving forward in the future. I can't do this job if I don't build some level of trust with the community. Trust does not mean agreement, but it at least means an understanding with the people in this city that when we have a conversation, they can believe what I say, they can trust I'm going to do what I'm going to do, and that we are on the same page and I will continue to fight for them even in those moments of disagreement. The community looks at that relationship as they do all relationships. If you want to come into this community and be a part of it, you have got to have those conversations with the people who live here. It's critical and it's imperative and it's essential for anyone who wants to build a relationship with our citizens and have a future in this community. And so that is the bar that we have tended to set around here, and I want to make you aware of that. So I'm glad that you did the informative session a couple weeks ago with citizens. I really hope that was not the one and only. I don't know what the outcome of this will be, but I can promise you if you want to have any sort of path, it's got to be With us, yes, but with the citizens who are going to be impacted by this. And so my advice to you is have more of those, sit in the room with these folks, whether they want to pat you on the back or push you out of the window, and at least know that that's going to be a path to all of us having better conversations on this issue as we move forward. So that is what I'll impart with you today. We are very thankful you are here, and we hope to keep this conversation going. So thank you very much.

Thank you. We're happy there's no windows in this room.

Yeah, we're going to take a five-minute break real quick so that everybody can come up here and people can use the restroom if they need to. All right, we are going to end that recess and come back to order. I'm going to ask the body, there's no wrong answer here. I imagine at the pace we're going, I wanted to give Compass a little extra time, so obviously we're not going to end this at 7 o'clock. We're going to hear from Evergy, and I want to make sure we give them time. My question is, after we do Evergy, are you still interested in the presentation on annexation tonight or moving that to a regular council meeting? Okay. Yeah, so I'm not fine with that, but we'll just know we'll do the averaging portion here. So I just want the public to know we are still going to have the conversation about annexation. We will just move it to a regular meeting of the city council here in the very near future. So we will make that decision this evening, and we will move forward with averaging. So, okay, great. With that, I will turn it over to Chuck Casely, who is here from Evergy. I'll let you introduce yourself and begin your presentation.

Thank you. Thank you. Mr. Mayor, members of council, appreciate the opportunity to come here tonight. I put a whole bunch of slides together, but the truth of the matter is my office is about a block and a half from here, so anytime you all want to talk to me, I'll just come back over and answer any of the questions that you have or go through this presentation in more detail. What I will tell you is there's several sections in here. I was never intending to go through all the slides, but I wanted to give you kind of a resource of information on several different topics, including the data centers and all the things that, you know, whether it's reliability, affordability, or economic development generally, because those are things that you care about when you're thinking about data centers and things like that. I'm going to make just a couple of comments tonight. I'm going to touch on a couple of slides, but then I thought really the best use of my time would be to answer your questions, because when it comes to data centers and energy, and specifically Evergy, there's always lots of questions. So can you all see the slides? I can't see the slides. I can see the slides here, but I don't see them anywhere else. Yeah, we have monitors in front of us. Perfect. All right. The slide I'm looking at now is our service territory. We go from Wichita, Hutch in the west, all the way over to Sedalia in Missouri, up to the borders of Missouri and Kansas and down all the way through Pittsburgh and southeast Kansas. We've got about 1.7 million customers And I think most of you folks know that we're a combination of what used to be Kansas City Power & Light and Westar Energy, who merged some almost nine years ago now. When we talk about data centers, a lot of people think that it's our job or we're actively out there trying to recruit or invest in or that we are trying to bring data centers to Kansas and Missouri. That's actually not our job. That's not our role. Our job, as we see it, is to make sure that our existing 1.7 million customers have reliable and as affordable power as you can possibly have, which means job number one is to make sure that any new customer that wants to come here first does no harm and is a net benefit. And I'm going to talk a little bit about that. that proposition with respect to data centers. The second thing is we look over the long term at affordability. Every time we fix a poll, put up a poll, add wires, linemen, call center folks, all of those people cost money. And as it was said earlier, it's a huge grid that we maintain that is over 135 years old now. Some of the oldest parts of our grid are somewhere in the vicinity of 45 to 55 years. There are still a few transmission lines that are that old as well. And to give you an idea of the scope, we have roughly 40,000 miles of lines that serve all the customers in this service territory. And we've got more than 5,000 different substations, transformers that take high voltage power, reduce it, and get it to homes and businesses. It's an immense system that that costs right around a billion dollars a year to operate. So when you have big storms, to give you an idea, there was a large storm that hit just northeast of Topeka a couple nights ago. We had a microburst that took out about three miles of transmission. transmission line, over 30 structures were snapped in straight line winds. That in and of itself could be a five, six million dollar project to replace. So it's extremely capital intense. And one of the things that we see is large users of electricity, whether they are grain silos, whether they are oil refineries, whether they're some of our larger manufacturers, They have the effect of using so much electricity that they take a bigger share of the overall cost, that billion dollars a year to maintain the grid. And as we go forward and we have to invest in things like power plants and energy resources, they take a bigger share. a bigger chunk of that. And I want to talk a little bit specifically about how data centers do that and some of the protections we've put in place in just a little bit. But the notion that we operate under, we can try and cut costs as much as possible. When we were a, in fact, when we were a two separate companies, Westar and KCP&L in 2018 had about a $1.3 billion operating budget a year. Now we're down under a billion. So you can cut costs, right? That's one way to try and keep rates down. But the other way is to better utilize and have large users come onto the system that reduces residential, commercial, and other industrial customer share of paying for that billion dollar a year grid. Let me give you one very specific tangible example. Data centers are new in the news. We've been talking about data centers now for about a year where you can't hardly turn on the TV or talk to a constituent or talk to a customer without talking about data centers. But we've had data centers in our service territory for more than 20 years and we've had many large data centers here for upwards of two or three years. Google is one of our customers that in Missouri in the Kansas City region has a very large data center that they have built and are expanding. We for the first time came in for a rate increase in the Kansas City region on the Missouri side this last year. And we estimate conservatively that their usage alone, that one facility is going to reduce our request of all rate payers in that area by about $40 million. Now, we're about to go through what's called a true-up there, meaning we're going to take a look at all the revenues that are projected to come in, all the costs. And when we do that, I think it's going to raise even more. We've got just north of Kansas City is the St. Joe region all the way up to the border with Iowa. That's called our Evergy, Missouri West service territory. Right now, if we have a rate increase in that service territory that represents about 300,000 people, the residential share of that rate increase is about 50%. Looking out at the data centers that are likely to locate in that part of the service territory and going forward to 2030 to 2032, we see residential consumers representing about 8% of any rate increase that would occur, 8% to 10%. So that is a huge shift and a huge benefit for our customers if the data centers are done right, and if we make sure in the way that we interact with data centers, we do two things. One, make sure they pay their fair share. And secondly, that they have to make the kind of commitments to us and to our customers that if we're going to invest hundreds of millions of dollars of capital to support them, they're going to be around to make sure that they pay for it. So I'm going to skip a bunch of slides. These are all stats that you can take a look at about affordability and what we've done through economic development generally and how that works. Happy to answer any questions after you've had a time to digest this. But I want to go very specifically to data centers now to just talk a little bit about what we're looking at, how we interact, and some of the protections that are there. So first of all, We are about a 10.5 gigawatt peaking facility. It means in the summertime, in the weekdays, between 4 o'clock and 7 o'clock, so a day just like today, maybe next week or the week before when it's been in the hundreds degrees, that's when we reach our peak energy consumption. People are still at work. Kids are at school at 4 o'clock. Schools are still open. Manufacturing is still going on. Air conditioning is really ramping up as people start to come home. That's where we hit our peak energy consumption. Over the last 135 years, 135-year-old company, it took us 135 years to get to 10.5 gigawatts of consumption in a peak moment in the afternoon in the summertime. If you look at the slide that I have on the screen right now, you can see that we currently have about 3 gigawatts or roughly 30% of what it took us 135 years to get to of data centers that are currently building. They are signed up and located in our service territory. Then we've got some of those data centers are looking to expand. That could be another two to two and a half gigawatts. So now you're roughly at 50% of what it took us 135 years to get to. And then we're in advanced discussions with other data centers that represent addressable load, meaning load that we might be able to get on here sometime in the next five years, about another one to two gigawatts. If you take that all together, What that means is if everything goes as we are seeing it today, we'll do about 70% of our historical load in about a 10-year time period. So it'll take us 10 years to get to 70% of what it took 135 years to build to previously. That is load growth that is very much like you would have seen after World War II when we started electrifying rural areas and you started seeing all the homes in neighborhoods have air conditioning, things like that. It is a generational, maybe double generational projection of growth. And we're not done. That's just the folks we think we might be able to address. There's 10 gigawatts of data centers just waiting for the queue to open up and raise their hand and say, we'd like power too. Compass data centers is in that green category there. They're part of what could be, depending on what communities say in terms of whether they want them there or not. I will tell you. We work with the biggest companies and the biggest data centers in the world. We have seen every single kind of data center, good and bad, in the last two or three years. And this is an area that rolls up specifically to my area. I didn't tell you when I come. I'm chief customer officer, but I'm also head of utility operations. Compass is one of the best groups of people we have seen. They are a very solid, well-financed operator. And our due diligence that we have done on them says they know what they're talking about, particularly from an electric service perspective. And from what we have done, because we do talk to the people that finance them. We talk to the communities that they're involved in. In order to move into the queue, we want to make sure that we're picking somebody that will ultimately be a good customer for the people we serve. We've been very, very impressed. with Compass. Having said that, I want to talk to you about the things that Compass or any other data center is going to have to do if they're going to locate within our service territory. You know, the middle of the country, I'm from the Midwest, a lifelong Midwesterner, often gets laughed at by the coast because we're flyover country, just a bunch of agriculture and folks in the middle, and we don't know what's going on in the coast. But the good news about being in the middle of the country is we can watch what happens in the coast and decide when they've messed something up real good and make sure that it doesn't happen here. And that's exactly what we did at Evergy two or three years ago. We saw what was going on on the coast with data centers and we said, look, We don't want to say a blanket no to data centers. What we want to do is make sure if data centers come here that it's a net positive and they can't hurt reliability, they can't hurt affordability, and they can't hurt our customers. And so we went out and we worked with existing industrial consumers. We worked in Kansas with the Citizens Utility Ratepayers Board, which is who represents residential customers. We worked with the KCC, KCC staff. And we said, look, if data centers are going to come here, and they are, they want to come here, let's set up a set of rules and guidelines, regulations that protect Kansans. And so what we did is came up with what we called our large load power service tariff. Tariff is just regulatory speak for the rules of the road if you're going to get power here. And it does some things. that nowhere else in the country when this was approved by the KCC last December that there's not an assemblage of protections like this that we can find anywhere in the United States. This is really good proactive work for Kansas looking at what happens in California or Virginia or Connecticut, Pennsylvania saying we don't want that here. So first of all, any data center that comes in, any load that's more than 75 megawatts they have to follow these rules. The second thing is we're going to have to spend hundreds of millions of dollars in order to serve these customers in substations, transmission lines, and in generation. And basically what the LLPS says is you are causing this investment to be made. Two things have to be true. One, you've got to pay for it. We're not asking other consumers to pay for this. If you want a power plant basically built to fuel your data center, then you've got to pay for it. And we have what are called project agreements where they have to finance that capital for substations, for transmission lines. That all comes up front. Now, power plants are built over time, and because they're built over time, what we do there is the rate that we charge data centers is between 15 and 20 percent higher than other industrial consumers. And what we do with that 15 to 20 percent is that's how they pay for the generation that they're causing to be built. They pay a higher rate than everybody else. because they're causing us to invest. And by paying that higher rate, we don't have to ask other customers to pay for that generation and the facilities that we're building. However, Once those facilities are built, they become part of what we're obligated to pay back. So if a data center leaves, that's going to cause big trouble. What will happen is we turn around and say, well, it still has to be paid for. So part of the large load power service tariff is, in order to come here and ask for that kind of investment, you have to sign a 17-year contract. A 17-year contract for multiple hundreds of millions of dollars of bills on an annual basis for 17 years. And whether you use the power or not, you have got to pay for the power and pay for the premium that we have put on your rate. The third thing is there's collateral requirements. Not one of our other customers has a collateral requirement. If you want to start a small manufacturer, like let's take Mars. When Mars built here, we had to build out tens of millions of dollars of infrastructure to serve them. They don't have a long-term contract. They're not charged a premium and they're not required to put up any credit or collateral to back up the fact that they're going to be here. If they left, the citizens of Kansas would be left holding the bag if they weren't here for a very long period of time. Not so for data centers. Whether or not they use the power, if they request it and we build it, for 17 years they have to pay a minimum bill and in every single solitary case we ask them to post hundreds of millions of dollars of guarantees and letters of credit. So you can do cash collateral. You can do a letter of credit that we can draw on. And in many cases, most cases, we require a parent company guarantee so that if you decide to shut down operations, you still have to pay that 17-year contract. And that protects Kansas customers. And if you use less, you still have a minimum bill. So the large load power service tariff, in a nutshell, is a premium rate. We charge them more. They have to pay every single solitary cent for things that are just to serve them. We make them sign a minimum contract. We make them sign credit and collateral guarantees. And if you leave early or you don't use it, it doesn't make any difference. You still got to pay it back. And that is, again, to shelter Kansas consumers and our Missouri consumers. We now have something very similar there as well. I think the only other thing I would say, and then I just take some questions, is when you come to our service territory, and the reason we have a line for data centers, a queue for data centers, is you can't just connect to the grid because these are such huge consumers that if we did that, we could have a situation like you were talking about earlier where we didn't have enough power. We do extensive studies and we only allow them to ramp or grow their usage if we know we have the power to serve them. So we won't allow them to draw more power than we can supply. And one of the things that I believe was said here earlier, which is demand response or curtailing their usage, they are actually a huge help when we have a situation where there is not enough power on the grid. And to be clear, Evergy has never had one of those situations. We are part of the Southwest Power Pool, which is a 17-state region. During Winter Storm Uri, they did not have enough power. And because they did not have enough power, it impacted us. Having data centers on the grid would have helped us avoid the situation we had in Winter Storm Uri. They are such big users that by them turning down their use and or turning on their backup generation, they actually do serve as something that will make the grid more resilient. Let me give you an example. We have our IATAN power plant, which is right across the river from Fort Leavenworth. The newest generator there is about 850 megawatts. That's enough to power the entire city of Kansas City. That one power plant is enough to do that. Most of the data centers we are seeing today are in the 500 to 600 or 700 megawatt range. Well, that means if we have a situation at one of our plants where for some reason we have to take it offline, one data center almost makes up for that. which means that hundreds of thousands of other customers can avoid a potential issue because they can back off of their usage. They're also what's called a 24 by 7 user, which means they're always on, they're always running at that level. That's a lot easier to manage the grid than a customer that uses a lot and then a little and a lot and then a little. We build for peak consumption in the summertime between about 4 o'clock and 8 o'clock at night is when we see the most. But the rest of that time, the grid is significantly underutilized, meaning you've paid for it. Think about it like the interstate system. The interstate system is built to accommodate rush hour. Right? Your roads are around Topeka. Surface streets and interstates are designed to move people when traffic is at the most. But at 3 o'clock at night, how many people are on the surface streets? Well, if you had a toll road and it was busy all the time, you could reduce the tolls, right? Because during the time when it isn't busy, you're getting more revenue. That's what a data center does. That's what a data center does. And if it ever gets too busy, we ramp them back. And that allows other traffic on the road to continue. So there's a lot here. I tried to go real quickly. I know you're late from what you wanted. I'd love to take questions.

I'm going to open it up for questions. We'll just do it our normal way. So if you've got a question, hit your button. Council Member Kell? Okay.

Well... And that's because we can't have nice things. I know that you're a private company, and legally you have to do what's in the best interest of your shareholders and not necessarily your customers, or else you wouldn't have asked for rate hikes in the past after record profits. This kind of goes into the how many substations have you proposed or built for the purpose of attracting a data center or having that data center already lined up and Was that cost put on the existing customers? Because if you didn't have one on the books already, and those substations can cost anywhere from $8 to $40 million, from what I could tell. Some of them can be $100 or $200 million. Yeah. But have you done any of that where you've built already without actually having a contract with the data center or just proposed to attract a data center? Yep.

So that is one of the questions we get the most from economic development organizations all over the state. I can think of several industrial parks. I won't name them since we're in the public here today, but several industrial parks in other cities the size of Topeka who have come to us and said, listen, if you would just build a substation and transmission lines to this industrial park or this region, we could go get a manufacturer, we could go get a data center and we want that in our community. We're not allowed to do that. We are not allowed to build on speculation. All we can do is built to serve the load that we see in an area that we know is coming with a little bit of margin for growth. So, for example, if we're in, let's just use Olathe, and there's a subdivision that's being put in, we would size a substation to accommodate what we knew it was going to be, and then maybe 5% or 10% over that to accommodate for growth so we're not, you know, so we do it a little more efficiently. These are huge users. So, for example, a typical manufacturing plant of automobiles might be 50 megawatts. These are data centers who are 400, 500, 600 megawatts. There is no substation that we have on our system that could accommodate that. We have to build it. to suit the data center or the large manufacturer. And when they come to us, that's usually the very first thing they say is, how long will it take you to build substation and transmission that is sufficient to get us the power? And the proof of the pudding is this. What every single data center would like is to start around 250, 300 megawatts. Most of ours start around 25, 30, 40, 50 megawatts, and then they gradually grow as we're able to build the facilities to suit them. So we don't build things on spec. We build to stay ahead of normal growth, but this is not normal growth.

So in that situation, there's a town in western Missouri that, The citizens feel that Evergy came in saying, oh, we need to do this, and then next you know a data center is about to pop up. So there was no previous need for any more electricity, except for, oh, this may be for future growth a little bit and things like that. All of a sudden the substation needed to be built and now, boom, all of a sudden the data center is popping up right next to that substation that a lot of citizens in that area were very concerned about that. They felt that, in essence, Evergy led the way for the data center. So in essence, it was a... Do you know the town?

Yes, Maryville, Missouri. Okay, so we don't have a big data center in Maryville, Missouri. It's in essence the ground is being broken on it, it seems like. Well, so I know I'm very familiar with the data center proposal that you're talking about. They are not in our active queue, meaning we have not said yes to even actively evaluating them in detail. That's the first thing. Second thing is Maryville's part of our Evergy Missouri West service territory, which has the lowest rates in our system. The reason they have the lowest rates is because they have historically been one of the more under invested areas. Everything we've done in Maryville, St. Joe, Atchison County, Nottoway County, that's all been part of a five to 10 year plan. to improve reliability there. So they do have some new substations. We're still building substations. Those substations cannot accommodate a data center, not even close, not a hundredth of what a data center would need, but there is good land and good fiber there, and that is what is driving this particular data center. I would also say this particular data center has gotten pretty frustrated with us because we haven't allowed them into our active queue yet. And so they're talking about islanding or providing their own generation and just doing it anyway. I think there's a lot of conversations they need to have with that community, but that is not something we're actively working on right now.

Then kind of going to your seven year commitment or 17 year commitment. I know you said there is collateral put up, but. this day and age, you see companies just go bankrupt out of nowhere. A lot of people are left holding the bag. Why not make these companies, you know, come up with, either come up with it up front or say, hey, you've got to pay this off within five years. Because a 17-year period, when it comes to technology, is a lifetime. That's, you know, That's almost like one of us, 80, 90 years for a person, technology just changes so quickly that they can sit there and say, this is no longer needed, so we're going to file bankruptcy or we're going to run ourselves on the ground trying to develop so much. Where is that... guarantee that that money, that whole investment's going to be there where it doesn't fall back on the customer.

So those are great questions and points, and I'll address them a couple different ways. First of all, before we break ground on anything that is directly to serve a data center, we require them to pay us up front. So substation, transmission, specifically to serve them. We have what's called an initial project agreement. And before we order equipment, they're going to sign it, and they're going to give us the full amount for that. And then we will spend that down in order to build the facilities to directly serve them. Now, when it comes to generation or when it comes to networked transmission, and what I mean by that is transmission that isn't to them but might have to be put up somewhere else on the system to keep the system reliable with this load being brought on in a specific area, that they pay for over time in their electric bill. And you're right that if you declare bankruptcy, that would be a way to get out of something like this. So a couple things. One, we require letters of credit, meaning they have to get a bank to allow to post a certain amount of money that we can draw on at our discretion that is not subject to a bankruptcy. And those are in the hundreds of millions of dollars. And then the second thing is we ask for parental guarantees. And those parental guarantees are have to be for companies that are credit worthy, meaning by Moody's, Fitch, and S&P have top credit ratings. And then we get to look at their financial books and know what their balance sheet and their assets are. And if they aren't sufficient to cover what we need, Then we ask for additional collateral in the form of either cash or more letters of credit. To give you an idea of the companies that sign these parental guarantees, they are not companies that are $100 million companies or billion dollar companies. Almost without exception, these are companies with trillions of dollars of assets and trillion dollar balance sheets. If they go bankrupt, we're going to have a lot bigger issue in the country than just what's going on in Kansas. So, for example, the Googles, the Metas, the large banks of the world, those kinds of things. We don't take – if you don't have the assets and the credit rating to back it up, you're going to have to post a letter of credit or collateral.

And last question. Very familiar with IIT, and I was born and raised in Leavenworth. Last I knew it was a coal-burning plant. It is. Okay. How much, maybe ramp that up for a data center anywhere, will that affect the environment? What, burning coal and also possibly rates getting jacked up because of the cost of coal might go high or government regulations now make it where it's... you know, it's something you're not able to use regularly. They want you to change. Because of these data centers, how much will that possibly change our rates?

So, first to talk about coal. We're not building any new coal. Iatan happens to be one of the newest coal plants in the United States. So it is, other than the carbon dioxide issue, it is virtually emissions free. It also has a closed loop water system. So it doesn't use a lot of water. But We generally run that 24-7, 365 days a year, except if it has to go down for some maintenance. So it's not going to run any more or any less. Most of the generation that we build today and will be built to accommodate data centers will fall into roughly four categories. One is incremental wind, one is solar, one is battery energy storage, and the other is natural gas plants. Natural gas plants don't have almost any of the emissions issues that coal plants do. They do have the carbon issue, but it's about 60% less than a coal plant. And ultimately, we see natural gas coming in, and ultimately third and fourth stage nuclear will be what replaces our coal plants as they age out of the fleet.

Thank you, Mr. Mayor. Council Member Valdivia-Alcala.

I just have one quick question. Thank you. Does Evergy foresee any future meetings with the public, and I'm talking specifically with Topeka and Shawnee County folks upcoming, so that they can express their concerns and any additional questions they might have during this one-year moratorium?

The data center moratorium?

Yeah, not about the moratorium. I'm asking, during this one-year moratorium, do you all anticipate having any public meetings around this area to where folks, like, that haven't been allowed to make public comment, and I understand the reasoning for that, but that maybe have been emailing you, you know, writing to you, calling you, or whatever, can actually get in front of you guys and ask questions. Are you planning any kind of community meetings like that?

So we have told Compass to the extent they have community meetings, we're happy to participate with them on that. And if there is a community desire to talk about how we would serve this specific data center, we're happy to either participate in Compass's or have our own. We have not had a lot of people call or email about this. We have. No, I know. And so, for example, if you have constituents that would like to talk to us, we'll come to you. If you want to have something, we would be happy to. So, again, our job isn't to say yes or no. We have an obligation under the state law to serve any customer that comes here. as long as, you know, we can't allow it to hurt reliability, okay? So that's why we have a key. We can't possibly do all the data centers that would like to come here. And so we've established a line, and then we criteria, we try and pick to do business with the very best ones. But if you have constituents that would like to talk, if you have e-mails and they're energy questions and you want to get them answered, we would be happy to dialogue and like I said we're a block away so you know we're happy to do whatever you'd like.

Thank you.

Yeah. Council Member McGee.

Thank you. I have a couple questions. We just want to make sure we don't have the cart before the horse here. Do you currently have the load capacity to generate an extra 400 megawatts or are you counting on KCC approval for new generation?

So we are in the process of, so no, we do not have enough generation to serve everything that I detailed on this earlier slide. we are going to have to build generation in order to do that. And we're not counting on the KCC to pass through rate increases for the generation that's going to serve data centers to your constituents, residential, commercial, and industrial consumers that exist here already. But we do expect that if we put um you know a contract in front of them that has the protections we we spoke about um and and we build that generation that the data centers will pay for that and they're also going to pay for a huge chunk of operating the grid as it is today we will have to build new generation that new generation and when it comes on will determine how quickly and if we can accommodate data centers of any kind so this is still continued upon

KCC approval for that additional generation.

Oh absolutely, yes.

I'm sorry I had to step out for a minute. Previously with Compass, we asked a couple times, hey, would you be willing to put that in writing? I go back within the past six months. We experienced some power outages here in Topeka. I know at my house, one lasted over five days. And You know, I asked, you know, I guess for some guarantee on what the priority will be if and when there's a blackout or power outages, what guarantees that you're willing, what are you willing to put in writing a guarantee on current load versus new load? What guarantees do we have?

So that's a great question. We are a regulated monopoly, and I say that because most people in my business don't like to say they're a monopoly, but we are. And as a result, we are highly regulated. And so almost everything we do, much like the deliberations of a governmental body or city services, is public. It's required to be public. It's required to be in writing. And it's filed with the Kansas Corporation Commission and other entities. What I will tell you is you probably don't want a blanket rule that says new energy versus existing energy. What I think you want or what people would want is to make sure that data centers don't cause a lack of generation and or are the first to be called upon if there is an energy shortage. And that is in writing. We've got a we will have agreements with them that says several things. First of all, in a grid emergency, they're first. They go first. And that doesn't have to be. And by the way, that's not universal around the United States. That is something that is true in Kansas. It's true in Missouri. But it's not true everywhere. That's in writing. That'll be in the electric service agreement that they sign with us, that they know that they do not have a guarantee of firm power in a grid emergency. And it spells out exactly what those criteria are. In addition, one past that, we can curtail them or cut their usage just in our judgment, if in our judgment it's causing a problem. It is very rare that we have done that with our existing data centers. It's a lot more frequent that we ask larger manufacturers to do that because they have a lot more variable load that they put on the grid and that can cause more issues. Data centers, once they start running, they're very predictable and we understand them very well. Having said that, it is in writing. You have my word. I can even share in the documents that we have existing. We don't share contracts with other companies, but we can redact who the company is and give you what that looks like because it's a matter of public record and we'd be happy to do that.

Now, I just mentioned a five-day outage at my house, but I will end with a comment and compliment. I used to run a an electrical utility and we had a 99.99% reliability rating. I read through your information this morning, you also have a very high reliability rating. So I wanted to compliment you on that. I hope with taking on an extra load of 400 megawatts that that could still be the case.

Well, it's incumbent upon us to make sure that we don't lose reliability by bringing somebody on. First of all, thank you. Sorry about your outage. Over the summer, it's been one of the most active storm seasons we've had in probably a decade. Last night, we had storm... We've got a lot of engineers in our company, so we're not the most creative people in the world. It was storm U26, U because that's the letter of the alphabet we reached, and 26 because it's 2026. It's really a unique naming system. I've advocated that we should give them names like hurricanes, but nobody thinks that's funny. But just this week, surrounding Topeka, we've had – at least two transmission lines that have had poles snap from straight line winds. In fact, a couple nights ago in Hoyt and the surrounding areas, I haven't seen something like that in a while. So there have been some periods in this area. Earlier this summer, it was Salina, Junction City, Topeka that got hit pretty hard over a period of about three days. There were storms that just kept rolling through. So sorry about that. What I will tell you is that our average duration of outages, as I'm showing on the screen, has been going down steadily over the last four years. And just this year, and I didn't bring this slide with me, but just this year we're on the top decile for reliability of investor-owned utilities in the United States. Um, it's something that we take very seriously. Um, and we continue to work on council member Miller.

Thank you, mayor. I appreciate you being here, sir. Um, there was something in the last conversation we just had with compass. Um, and those touching to what he was just talking about a little bit. The man said voluntarily if asked, they would go to backup energy, okay? What you're saying right now is that it's not a voluntary thing. It's part of the agreement, correct?

Yes. So there's actually kind of maybe three different kind of criteria or ways that that could happen. The first is, in our electric service agreement, they have to agree that if there's a grid emergency that's declared because we don't have enough generation or because we can't get enough power to a certain area or because the grid in a 17-state area would become destabilized, They have to acknowledge, they understand, we are going to take whatever steps necessary to preserve the stability of the grid and reliability to most. That's declared by the Southwest Power Pool. They have a series of grid levels, and at certain times, we don't have to ask. We can just do it. The second is if in our judgment we're seeing something just in our electrical grid, the entire grid, and we need to shut it. Let's say a plant comes offline or a substation has an issue. We can do it then, and it's not voluntary, and we can do it instantly. Now, the third category is if it's just cheaper, better, or easier. In other words, and we sign an agreement with them that says, would you be willing to do this if we called you and asked you to do it? It's not an emergency, but would you be willing to do it? And I'll give you an example of why that might be something we would want to do. Operating our grid is a little bit like different kinds of cars, right? You have big truck, right? Big truck carries lots of goods or a bus carries lots of people, right? But if you were going from your house down to the 7-Eleven and it was just you, you wouldn't drive that bus, right? That wouldn't make any sense. It costs too much in gas because it's a gas guzzler to go down there. You'd take a smaller car. Well, our power plants are the exact same way. We got buses. Those are our base load plants. We know we're going to be running them every day because there's a certain amount of people that are going to travel every day. But in the summertime, what happens is we could get full up on this bus And then we're looking at what we have to carry, and there's like two more people. Well, it might be cheaper to ask them not to ride than it would be to fire up another bus and drive them to the 7-Eleven. And so in that situation, we say, look, there are going to be times when instead of turning on another power plant, instead of incurring more fuel burn that all customers have to pay for, Could we just turn you down a little bit? And their answer is, you know what? Yeah, we'll fire up our own generation. You do that. And we actually pay them to do it, but it's more cost effective to have them turn down their usage than it is to fire up another big power plant. And so that is a voluntary agreement. They don't have to do that. We've got customers who don't do that. But our best biggest customers do, which gets back to why I said as we dealt with them, we don't have a lot of data centers right now that are willing to do it. They were actually, I think, maybe the first in this large data center category to come forward and say, we're willing to do this if it would make the grid more efficient and if you would like us to do this.

Okay, thank you. And that was kind of what I wanted to understand was just in business, if you're asking them to do that and they're still paying the same exact rate for the 105 to 86 minutes you're talking about right here, what is, so you have to pay them to do that? Yeah, we would pay them, yes. Okay. Okay. Okay. That makes more sense there. Um, and quick follow up. Um, you guys do a lot of research on this. Yep. So let's say in the past 5 to 10 years, how many days do you think. that you would have that type of situation? How many stressful days on the grid? This year, none.

Zero. We haven't had any grid emergencies this year. We have had times when we have said we are going to. So, for example, it's not just data centers. It's other manufacturers. It's other customers. Even residential customers can do it if they want to. If you want, you can call us up. We'll give you a Nest thermostat. And you can have that Nest thermostat for free or nearly free. But what we'll tell you is up to four or five times a year during this time period, we might turn your air conditioning up from 72, 76, whatever you have to set a couple degrees for a couple hours. Folks who aren't home, during that time period. That's generally who likes that. Folks who are at home don't want us messing with their air conditioning during those time periods. We've probably done that twice this year, maybe. Not because we needed to, but because it was cheaper. So it is cheaper to have 30,000 people have Nest thermostats that are willing to do that. They get a Nest thermostat for next to no money or no money at all. That's a benefit to them. And for us, if we don't have to, again, fire up that bus and take it to the corner store, It's cheaper in gas, not for us, but for you. So would you rather have us pay, you know, somebody, 30,000 people, $200, so that's what, $600,000 for, you know, those thermostats to save $2 or $3 million a year on fuel costs? That's kind of what this is.

Okay. Final thing, quick, I promise. If you're saying the customers, hey, I want to support your portion of the grid and your share, we're going to pull them back and we're going to pay them to do so. At what point, who eats that cost that you paid?

This is another great question. So, yes, we do pay them, but we can only do it, we can only get into a voluntary arrangement like that if it costs less to ask them to do it and to pay them to do it than it would to use another resource, right? So, and in this particular case, the reason that most data centers are not willing to do this and the reason we still say it's voluntary and it's a positive thing is because when we bring them down, when we back them down, they lose two things. First, they get paid for uptime. And so now whatever revenue they were going to get, they're going to lose a bunch of that revenue. Secondly, it doesn't always make their clients super happy. And third, most of the time what happens is they try and make up part of that by running their backup generation, if they can. They can't always do that. But if they can, they do. In no circumstances that I am aware of is it as a net positive for companies to do this. In other words, we'll pay them, but we don't pay them enough to make up for the lost revenue. We don't pay them enough to make up for the fuel that they might expend. So it's still a net negative for them, and that's why it's something that we see as a good thing and a positive thing in somebody who comes on the grid. Thank you. I'm done. No worries. Council Member Bradbury.

Thank you. I've got a couple of questions here, and I don't know where to start.

Well, go ahead.

You talked about this large load service and something about an 80% minimum monthly bill.

Yeah, a large load power service tariff.

Okay, so... It sounds like that, if I remember everything that you just said, it sounds like that 80% protects Evergy from some of the cost. Or can you explain that to me again?

Yeah. The data centers are really any customer. Data centers are just very large customers. We're going to have to build to meet the amount of electricity that they want to have to serve them. So let's just say it's 100 megawatts. It's usually multiples of that, but let's just, to make it easy, I'm a recovered attorney, so let's make the math easy, because if I was good at it, I wouldn't have become an attorney. So at 100 megawatts, that takes a certain amount of infrastructure that has to be built. Wires, substation, generation, that all costs money. The way we recover it is we charge them an electric bill, and that electric bill is based on what they say they need. Well, the 80% minimum bill means whether or not they use what they say, they're going to have to pay for 80% of what they ask for over that 17-year time period. That is enough over that time period to cover the investment that was made on their behalf. Now, the way that regulated utilities work in Kansas is if we bring this generation on, it has to be paid for. And it's paid for by these customers. But if these customers go away, then what happens is the state and the remaining customers are still responsible for paying this, because it's all one big system. So yes, it protects us. But it also ultimately protects the 1.7 million customers we serve in our service territory. Because what we do with the money that we get in that 80% bill is make sure, if they were to leave or shut down or go away, is to make sure that they pay back for what they paid for and that doesn't become a customer burden. And that is something that is written into the tariff. That's how that would work.

OK. And is the 80% something that Evergy decided or is that?

So what happens is we filed this tariff in front of the Kansas Corporation Commission, and then it was actually the Kansas Corporation Commission approved it, but it was a unanimous settlement with all the parties involved. And so just some of the parties involved were a coalition of data centers, existing large consumers like Mars or any other big manufacturers in the state, The Citizens Utility Ratepayer Board, which is by statute the entity there to represent residential consumers, the Kansas Corporation Commission staff, other utilities, they all got together and basically negotiated until they reached what they thought were fair protections for existing consumers. And, you know, large consumers are, you know, they've got a huge vested interest in making sure that, you know, consumers generally are protected. I mean, the existing manufacturers here, because if something goes south, they're going to pick up the lion's share of the bill and they don't want cost shift to them either. And so, ultimately, it was unanimously agreed upon by all the parties. I don't think I've seen that in almost any other state in the United States that got a deal where everybody thought it was a good deal for all consumers.

So was there a certain methodology used to come up with that 80% or how did?

Yeah, the 80% was originally roughly based on the fact that if you had 17 years of 80% of what you built, that would roughly cover in almost every circumstance the amount of money that would have been expended to bring those assets online.

Okay. And then the next question I have is it sounds like Evergy is going to start relying a lot on gas, natural gas?

We are currently building three natural gas plants, two in Kansas, one in Missouri. Can you talk a little bit about that? In what respect?

In general. Just how will the addition of those affect any of the rates?

So those plants were planned prior to any of the data centers that we put. Again, in the presentation, I didn't specifically cover it. But there's six electric service agreements we've signed with data centers. It's public. You can go see what they are. And those plants were designated long before any of those came. A couple of reasons. One, we haven't built base load generation or dispatchable generation in multiple decades in Kansas. So it was time to build something that runs when you turn it on again. The other reason is because we've got a coal fleet that is aging. The average age of our coal plants is better than 40 years. And they have a useful life of around 50 years if you keep up on the maintenance and all that kind of stuff. And so we have some plants that are ultimately going to have to be replaced. And as Councilman Kell said earlier, there's also increasing environmental regulations on coal plants, which means in the future they may not be able to operate as much. So those natural gas plants... that we are currently constructing, again, two in Kansas and one in Missouri. Those are all to diversify the fleet, to take care of existing load growth that doesn't have anything to do with data centers, and to make sure that as the coal plants start to age out, we have other dispatchable generation. In the future, as we bring on more data centers, if we approve them and they move forward, we will build assets that will be batteries, solar, wind, and gas to serve those in a portfolio.

Okay. That's all the questions I have.

Thank you. Council Member Ortiz.

Thank you. We will be discussing annexation. I think you heard this question before. Yep. Are you able to discuss how the Compass project could affect franchise fees that Evergy would pay to Shawnee County or the city of Topeka if the city were to annex this area?

Sure. That's a great question. And again, one of the things that we think for data centers or any large user is a benefit for the cities that the large manufacturer or large user of power locates in. We have a franchise fee that is based on gross receipts, monthly gross receipts, or revenues collected from customers. The city of Topeka is the one who sets that within statutory guidelines. I believe yours is 6%. Mm-hmm. Some cities are five. I don't know of any that are above 6%. There are some that you can choose to go lower than that. So effectively what that means is you take the annual bill that would be collected from a data center And they would have to pay a 6%, as it exists today, franchise fee on the electricity that they receive. And that would go, if you annex the property, that would go directly to the city of Topeka. And I think yours probably goes into a general fund. I don't think it's earmarked for anything. So, you know, depending on what their ultimate bill would be, and it would be a significant bill. I mean, these data centers have bills that run from anywhere from $100 million a year to sometimes $300 or $400 million a year. Take 6% on that, and that's what it would be if that's the franchise fee amount that you wanted. Now, sometimes data centers come in, and we've seen this happen in other places, and ask, say, listen, we're willing to pay a franchise fee, but we're such a huge user. Could it be less? We've seen those negotiated in other jurisdictions, but that would be completely up to the City of Topeka. And between you and Compass, we are just the collector and remitter of that franchise fee. City of Topeka sets it within statutory guidelines. If you annex it, that would be something that you would be collecting. And again, I think it could be anywhere from $5 million, $6 million, all the way up to upwards of $15 million to $20 million.

Okay. And one last question. What shape are our grids in? Because it seems like every time there's a storm, East Topeka, Oakland, when they go out, they go out. I'm not talking like hours. I'm talking about days. Yeah. And so I just want to make sure what kind of condition are they in?

So as I said earlier, we have actually had the best reliability on the entire grid that we've had probably in the last 20 years this year, and it's been steadily improving. Now, having said that, there's a couple things that are important to note. The age of the grid and therefore the strength and resiliency of the grid varies significantly depending on the age of the grid in that area and depending on the type of grid that it is. In more rural areas, so once you get outside the city limits of Topeka, you will see a lot of the electrical grid is what we call a radial feed or a radial, it's a radial grid. electrical grid which means it has a line or two lines coming from an urban area out to a city that's outside of Topeka, Hoyt, Oakland, surrounding cities. If the transmission line that feeds that goes down, then we can't restore service until that transmission line is put back up. In Topeka, if you have a transmission line that goes down on the east side of town, we can reroute all the way around most of the time through the western part of the grid and backfeed it into that area. But if you have one or two lines that go out and they go down, then what happens is it won't get restored until... every single one of those poles is redone and the line is restrung. One of the things that we are doing is systematically going through our electrical grid as a whole and trying to replace anything that has a radial feed to something that has multiple feeds into it. That again, everything can come back to data centers these days, that again gets back to a benefit of data centers. Because they require so much power, we frequently have multiple transmission lines coming into them. They frequently have, you know, make us build transmission lines elsewhere. And we pay for them. And so that provides us additional routes to reroute power, which would be a good thing for communities. The other thing is, as I mentioned, it takes a billion dollars a year to operate this grid. That's before we get into investing to improve the grid. And we're going through and trying to replace a lot of the radial feeds. Well, when we replace a radial feed to Oakland, for example, that's a cost that everybody pays. And it's a socialized cost on the system. But with a data center, they're going to take up a big chunk of that because they're such large users. So even though it's not something that is going to directly affect them through their rates, they have a common usage part of that charge to pay for the operation of the grid as a whole. So they will be helping to pay for Oakland and other communities to allow us to upgrade the grid. I'm gonna say something incredibly unpopular right now. And that is your electric rates are going to go up more or less with inflation. over the next five to 10 years. They just are going to. The cost of everything from materials to labor is going up. Data centers and other large users are a way to help decrease what that would be. Will it mean that rates go down in the near term? No. But will it mean that rates go up less? Yes. And in the future, I do see an opportunity where data centers and other large manufacturers, chip manufacturers, battery manufacturers, solar panel manufacturers, those entities use so much power that everyone that comes in takes up a bigger share of that shared cost of the grid.

I guess my constituents and my self concern is if the grid can't handle it now, how are we going to handle it with them? And I hear what you're saying, but that's their concern. Because we're always without power.

Well, you and I. At the worst times. You and I probably need to talk after class anyway. We do. So we can look into it.

We do. Thank you. Thank you, Mr. Mayor.

Councilman, honestly, man, this better be short because we are out of time.

So this is paraphrasing a question that came from online. How many data centers are currently running in the Evergy service area? How many are being built in the service area? And how many companies are coming to Evergy with plans for proposed data centers? How many companies and how many proposed data centers are being talked about? Okay.

So I will answer in as much granularity as I can. I'm going to go back to this slide. So first of all, we probably have upwards of 70 or 80 data centers in our service territory, maybe more. We don't necessarily know all of the data centers that exist. So, for example, most banks have data centers. that take 10, 15, you know, megawatts. They're smaller data centers. And we've got a ton of small data centers that have been built over the last 15 years. They're all over the place. So I cannot, I can't answer you the question how many data centers because, for example, Evergy has a data center just two blocks over this way in the BNSF building. And, and we wouldn't necessarily know about it unless, you know, we know about it because it's ours, right? So I can't answer that broadly. What I can tell you and I think most people are concerned about is what we call hyperscale data centers, the really, really big ones. And for the answer to that, So within the last 18 months, we have announced a total of five hyperscale data centers. You can see where they're located, who they are. One is Digital Realty. One is Beale Infrastructure. Two are Google, and one is Meta. The only two that are in Kansas are in this part of our service territory, but they're in and around DeSoto, Kansas, is where they're located. So that's the answer to what hyperscalers are here now. Then what I would tell you is in the green category, which would be new data centers, there's probably two or three that we are looking at as potentials. We haven't said yes to them yet because we don't know whether we can get the generation transmission to serve them, so we're still working through, we're still studying that. And then in the orange box, which is Tier 3 and represents around 10 gigawatts, I believe there are 22 different proposals all over Missouri and Kansas looking at it. What I will tell you is the likelihood that we get very far out of the green box anytime in the near future is not significant just by the virtue of the fact that these are very large users and we simply can't build more than we're doing now.

And then companies sat there and talked about their Q&A section. I know you do have a data center page on your website. I was wondering if you guys could start maybe adding to that, maybe a Q&A section where you can maybe talk more about, especially how it's going to affect the energy service area and how it might affect everyday customers.

Sure. I mean, we can augment that. One of the reasons that I did almost 30 slides today was to give information that you all could have and publicly use. But if there's a deficiency or something you think that we need, we're happy to put it on there, and we will continue to keep adding to that particular part of our website. All right. Thank you. Thank you.

All right. If you have any more questions, too bad. You get to ask them later, and he's easy to get in touch with. Yeah. Just walk down the street.

Yeah, that's right.

Thank you for being here. We very much appreciate it. Thank you. I know that this information was useful to everybody. Appreciate it. With that, we have nothing else on the agenda that I'm aware of, so this meeting is adjourned.