Music Thank you. Thank you. Thank you. I'm sorry. Thank you. I'm sorry. Thank you. Thank you. Oh, shit. I'm going to go to the bathroom. Okay, we'll go ahead and get started. If we can have everyone take a seat. Welcome to the March 12th Environmental Quality Meeting. As everyone's having an opportunity to review the committee summary, if I could have a motion when we're ready. Any adjustments, changes? Council Member Farmer. I'm sorry I haven't logged in yet. At the bottom of page 2, under Capital Projects Update, second from the bottom, in response to a question from Farmer Martin, which is an interesting, well, I mean, there's a grammatical part there. In the next line, it stated the remedial measures plan project has an estimated cost of $550, and I'm all about that, for the next 15 years. And he started, which I think should be stated that the goal is. So I think the 550 number probably needs an M or a point or something else or a clarification. There is a clarification, and I assume probably it's a million is what you intended. So $550 million, and then he stated the goal. So those two, please, sir, and I want to move approval along with others. Okay, we'll make those corrections. Any other corrections on the Senate? Yes. Customer Clark, if you want to log in, too, for me. Okay, customer Clark. The paragraph before that, the farmer Martin needs to be, I guess, a comma, and also the word any XT should be instead of nest. Very good. I like the phone of Martin. We are correcting it now. Are there any others? Council Member Scotchfield, if you'll turn your microphone on. There we go. Thank you, Chair. I just walked in. Just want to make sure, meeting summary, make sure the date is correct. Which date? On page 1 under Roman numeral 1, second by Meierster, approve the 129.1,13. Just make sure we have the right date. Got it right. No, it adds an extra 1 in after the 29. 29.291. Any other corrections to the summary? All right. With those corrections, do I have a motion to approve? No. Second. Okay. A motion and a second. All in favor, say aye. Aye. Any nays? Okay. On to our first agenda item. This is our annual review of the environmental quality public education effectiveness. I know this was requested from the environmental quality public works link budget link last year. Councilman Myers, did you chair that link? Environmental quality last year? Bill Farmer, did you want to add anything to this before we turn it over to the administration? So you're asking me based on my participation in the link last year. Is there any background? I think this is just a normal update that we want to start seeing since we're spending $80. Our former colleague and current employee, Tom Blues, chaired this section. I have read this, but there's nothing that I have in my mind. That's fine. People have said that for years, though. Any other background? Because I believe this is the first time we've had this kind of update. So we have Mark York from the Division of Environmental Quality. So, Mr. York, you want to take it away? Thank you, Chair. Thank you, Council members, for being here this morning as we provide you with this update on the effectiveness of our outreach campaign with the stormwater program. I want to first start off with a little bit of background. Why are we doing outreach? Well, we have a problem. Eight of the nine, the watersheds in Fayette County show polluted streams. Those red streams on the map are the most polluted. The yellow streams are slightly less polluted than the red ones. Again, eight out of the nine watersheds indicate stream pollution. Stormwater runoff is the major problem that we have with pollution in our streams in Lexington and Fayette County. This is just a typical map, excuse me, a photograph of a typical neighborhood. In Lexington, you see a majority of the area. We've got residents there. We've got commercial property in that photograph. This next slide shows you the amount of impervious surface. When it rains or snows, that water does not get absorbed into the ground. It runs off rooftops, parking lots, sidewalks, streets, driveways, and into our storm sewer system. This is a map of the Wolf Run watershed. Again, it's a highly urbanized watershed. at about 40% has impervious surface. Anything that's on the ground, fertilizer, motor oil, trash, litter debris, is going to get washed into our streams, which leads to very poor water quality. There are some key points that we need for you to take a look at and consider as we talk about our program today. Lexington is responsible for maintaining our stormwater program. We are responsible for all the water in Fayette County, with the exception of the stormwater program at the University of Kentucky, as well as those highways and roads that are maintained by the state transportation cabinet. Each of those entities have their own state stormwater permit. Our standards are set by Lexington's stormwater permit that was issued by the State Division of Water. The state, as well as U.S. EPA, recognize that if we're going to improve water quality, we have to have the citizens in our community engaged and active in helping us do that. And that's why our state permit has a public education, public outreach, and public involvement component to it. Sometimes you hear Charlie Martin refer to our state permit. It's an MS4 permit. The M stands for municipal, and the four S's stand for separate storm sewer system. And again, our program is funded by the water quality management fee. As we look at doing outreach within our community, what we're talking about is social marketing. We're looking to change behaviors by the public, by the private sector. It's critical that we inform our public, make them aware of our issues that we have, and we've identified our target areas that we want to reach, including school-age children, the general adult population, and in specific commercial sectors as well. You don't just jump into a campaign with some messaging. You have to find out a little bit about what your target audience knows, or in our case back in 2009, what our audience did not know. We did a community-wide survey back in 2009, and there were some interesting things we found out. Only 24% of the residents that were surveyed knew the difference between the sanitary sewer system and the storm sewer system. That is a critical fact because, again, pollutants on the ground go into our storm sewer system, and those storm sewers discharge directly into our streams in Fayette County. That water does not go to a treatment plant for treatment prior to discharge. And that's the big difference between the sanitary and the storm sewer systems. If you reverse that fact, 76% of the people who were surveyed back in 2009 couldn't tell us the difference. And that's a huge, huge educational battle for us to fight. Another interesting fact, 85% said they didn't know or said they did not live in a watershed. I showed you the map earlier. There are nine watersheds in Fed County. We all live in a watershed. Why is that important? We manage water quality via watersheds. The pollutants that are in the Wolf Run watershed, for example, and their sources may be different than the pollutants in the sources that are in the North Elkhorn watershed. And so as we try to improve the water quality in areas of Fayette County, we'll do it via each watershed. Again, that's a very important fact for us to know. And again, the majority did not know that stormwater runoff is the major source of stormwater pollution in our streams. So knowing that we had a big uphill battle in making people aware of the situation we had, we began to put together a plan which said we have to let people know that we do have a stormwater quality problem in Fayette County. and that our everyday actions contribute to the water quality issues. And we're not just talking about water quality. We also talk about water quantity. All that amount of impervious surface leads to greater volume of water that is entering our storm sewer system and then entering our creeks. And if you dump a large amount of grass or leaf clippings into our storm sewers, you can block those pipes and then cause localized flooding. That can be a contributing factor. So that's another outreach point for us. And again, we're trying to let citizens know that they must do their part to help us improve water quality. So we began a campaign in 2010. We had several tools at our disposal. One is an EPA guide for communities with stormwater pollution. We have the data that's been generated that tells us which streams are polluted, the type of pollutants, and the sources of those pollutants. We have our state MS4 permit that tells us exactly what type of activities we need to undertake with our program, and again going back to that 2009 survey, we know the level of knowledge within Lexington. I mentioned some target audiences. The first I want to talk to you about is our outreach to students. We are in 109 schools in Fayette County. That's every public school and most private schools, and that's via a contract with Bluegrass Pride, a nonprofit environmental organization here in Lexington. A couple of photographs on that slide. We have students that are installing plants at a rain garden at Mary Todd Elementary School a few years ago, and then some students performing a cleanup at the Gainesway Pond. Last year, there were over 10,600 students who participated in some sort of stormwater activity via Bluegrass Pride. It may have been doing a storm drain stencil. It may be picking up litter next to a pond or a creek or a roadway or working in a rain garden. But a lot of students were doing a lot of things in our schools last year. We also target businesses. as one of our audiences. We do that via, again, through a contract with Bluegrass Pride through what we call the Live Green Lexington Partners Program. And the Partners Program is a program we initiated. We work with businesses and apartment complexes to help them reduce their environmental impacts and hopefully find ways to help them save money at the same time. We have 109 business partners on the water side of the program. We have 40 apartment complexes reaching over 8,300 apartment units. One of the things I do want to mention this morning, we have a slide of the Go Green, Save Green workshop. That is an annual workshop. Again, we invite businesses and apartment complexes in to learn, again, how they can reduce their environmental impacts. Our fourth annual Go Green, Save Green workshop is coming up this Thursday at Transylvania. Running parallel to our outreach program, the Division of Water Quality has its Water Quality Management Fee Incentive Grant Program, where they're reaching out to businesses who can install best management practices to reduce the amount of stormwater runoff or to reduce the amount of pollutants that are coming off their property. The photograph there is a permeable paver project recently done at the Ronald McDonald House through a Water Quality Management Fee Incentive Grant. I showed you a photo earlier of a typical neighborhood. Now, a lot of residents there, some businesses, we have to reach out at that neighborhood level if we're going to engage people and help us improve water quality. And we've done several outreach efforts to homeowners via what we call watershed festivals. This is a photograph of our first watershed festival at Green Acres Park a few years ago. We had over 300 people living in that neighborhood who came to the watershed festival on a Friday evening to learn about what they can do to help improve water quality. We had Louis Hillemeier there who was talking about proper lawn care maintenance, not to over-fertilize or not to fertilize right before it rains. Van Kirk, who used to own Auto Tech here in town, was talking about when you change the oil in your car, how to properly dispose of that motor oil. So we're reaching out at that neighborhood level to try to tell people exactly what can they do to help us improve water quality. And we're seeing a lot of good results through our campaign. We've done a series of surveys, exit surveys at events or exit surveys at workshops that are telling us that people are becoming more aware of stormwater, stormwater pollution, again, what they can do to help us improve water quality. For example, 60% of the residents who attended that first watershed festival left knowing they could tell us, what is a watershed? And you contrast that with 85% from the 2009 survey who said they didn't know what a watershed was. So we're seeing a great improvement in the awareness of stormwater pollution in Lexington. As we began to go into a second phase of our outreach campaign, we began targeting, having some bilingual messaging take place, and again, drive specific actions that citizens can take. We also partnered with the Keep Lexington Beautiful Commission to launch an anti-litter campaign. I'll just show you just a couple of examples of some of the banner ads that you may have seen in print publications. The top one there talks about picking up litter that's on the ground. And the second one is a Spanish version of disposing of your motor oil properly. The tagline on that is don't be a drip. And so we're using bilingual messaging now to get the word out to a greater audience. Part of adaptive management is to be able to, again, get information from your audience to try to do a better job of reaching them so they understand more about the problem, again, more what they can do to help us out. So while awareness has greatly increased the past couple of years, using the focus group last year, we got some very good feedback from the focus group. And awareness is up, and they said, we need to be told exactly what it is that you want us to do to help you improve water quality. And then they said you need to be able to find a way to motivate citizens to take specific actions. And so through adaptive management, we're doing that this year with our outreach. Just some results. Keep Lexington Beautiful Commission every year does a community appearance index. This is a litter survey in Lexington where we literally drive streets in Lexington on a given Saturday morning and measure the amount of litter that we see from the vehicle. And we're showing a slight decrease in amount of litter each year. The Great American Cleanup is a great opportunity for citizens to become involved, and we're seeing more participation by citizens in the Great American Cleanup. We're meeting all of our public education requirements contained in our state stormwater permit. I mentioned the Go Green workshop. From year one to year three, we've had a 48 percent increase in the number of attendees going to that workshop. And then over 420 citizens have participated in a series of workshops that the Arboretum has held in conjunction with our division. In looking again at performance measurements, we're constantly looking for information using adaptive management strategy to react to what the audience is knowing and what they're telling us. Again, we're meeting all the stormwater permit requirements. We're continuing to conduct exit surveys at our events and workshops to continue to get feedback. We're utilizing focus groups. Again, they're telling us that awareness is up. We're measuring the number of folks that are participating in Great American Cleanup events, measuring the trash and recyclables that are collected in those events. Again, the annual Keep Lexington Beautiful Litter Survey, that provides good feedback. The number of people coming to our website to look at information for residents, for businesses, and for others, what can they do, again, to improve water quality. And again, through our partners program with schools, businesses, and apartment complexes. The ultimate test at the end of the day is do we see improved water quality? And so while we're getting some good performance feedback right now, again, at the end of the day, we're going to be looking at water quality being improved. And so a few years from now, that slide will come up, and we'll have fewer red creeks and streams in Fed County, and we'll have better water quality. And, Mr. Chairman, that concludes my presentation. I'll be happy to try to answer any questions you or anyone on the committee may have. Thank you so much. I appreciate that presentation. I appreciate everything you've done to undertake this task. I know we didn't have this effort, what was it, just a short three years ago or four? Four years ago. This is all still in its infancy stages, so thank you for the work you've done to get it off the ground. I know we've worked together on several things, but thank you. Committee members, do we have anyone that has any questions? Just log in. Council Member Henson, you're up first. Thank you, Chair. Thank you, Mark, for the presentation. And I know that there is a tremendous amount of effort going into improving our water quality. I did have one question about, you mentioned the, you know, like pesticides and the lawn care. Right. Have we been in touch with lawn care companies as far as, you know, if there's going to be a rain event? do they hold off on applying those? Right. We've been trying to work more with homeowners and educate them. We do send letters to businesses from time to time if we have an issue with them with a stormwater problem. For example, we may have a concrete truck that's doing a washout that ends up in a storm sewer. That's an issue for us. We're a carpet cleaning company. We'll do a similar washout in the street, which goes into our storm drain. So once we get that type of information, we'll send a letter to them informing them that this is a water quality violation. We'd like for them to stop that activity. We really focused with the homeowners, though, to educate them about the application of fertilizers or herbicides or something like that. Yeah, the private portion of it. Right. But, again, I was just curious. I know it would be probably an income loss for them to not apply those chemicals, but it could definitely impact. Right. We developed a specific brochure for homeowners in the application of fertilizers, and there's information on the back of that brochure. And the first thing we tell people is contact the extension office and find out, do a soil test, and find out do you need to fertilize. If so, what are the application rates that you need to apply to your lawn? And, again, there's some helpful tips. You know, don't. A lot of times we think if the recipe calls for two cups of this, man, it would be so much better if I just add a third cup. You know, follow directions on the bag, if you will. And, again, don't apply the fertilizer right before it rains. Otherwise, that gets washed off and into our creeks. Okay. Thank you. Thank you. Thank you, Council Member Hinson. Council Member Farmer. Mark, thank you for the great job you're doing. I appreciate it very much. Thank you. Let me follow up on her comment. So if people see someone flushing something where they shouldn't, do you just get calls to 311 about it, or how do you report? You can call LexCall. You can call our office directly, and, again, we'll get that information. And Division of Water Quality is the entity that actually sends the letter out indicating, again, this is an activity that we'd just soon not see in Lexington, and please stop doing what you're doing. And your examples were concrete people washing stuff out into a... Right. Stormwater. And then also like a carpet cleaning company, sometimes they've been known to, again, you know, clean out in the street and it goes down the curb and into the street. I followed one day down Maxwell, who was just venting in as he drove down Maxwell. And I did call in. We will follow up with a letter. I think that's good. That's very good. And then, gosh, 85% of the people didn't know they lived in a watershed. That's interesting. There's opportunity there. The good news is we have a lot of opportunity, and you only go uphill from here. But we've had some success and looking forward to keep working hard at it. The cleanup that you all accomplished on Richmond Road, I'm going to go back to again, seemed to be very effective in terms of raising a lot of interest and getting a lot of involvement. Was it a good, did it pay back well as far as you were concerned in terms of education? It will continue to pay back. We're still doing some outreach with residents in that area, working still to develop some information in different languages. As you and I have talked before, there's about five different languages spoken at that apartment complex. And so as we develop messaging, we have to get those messages translated into different languages and then get them into the hands of the residents. So that's an ongoing project. It's been very effective so far. Thank you for your work there and all over. Thank you. Appreciate your support on that project. Yes, sir. Thank you, Chair. Council Member Kaye. Thank you, Chair. I'm actually a surrogate for Council Member Masati who cannot log in, so she's interested in speaking. Whatever it takes. Council Member Masati. Thank you, Council Member Kaye. Thank you, Mark. Great report, but a little troubling. You know, when you're telling us that eight out of nine Fayette County watersheds have polluted streams, that's not a very good number. Let me ask you, do you have a ranking of which streams are from worst to least? I guess that would be the correct way to say that, that you're working on saying, okay, we know that we have a problem. I'm assuming where there's more of a population, there's more commercial and that as well in comparison to rural areas. Do you have a ranking system? Let me ask your question and say, no, I don't have a ranking system. But what we do have is probably more critical to us in giving us additional tools to use. We're very fortunate in that the University of Kentucky received a grant to do a watershed plan for the Cane Run watershed. And Susan Bush, who's my boss, received a similar grant to do a watershed plan for the Wolf Run watershed. And each of those plans contains specific activities, BMPs, to implement within those watersheds to improve water quality. So ranking may tell us something. We know what pollutants are in each watershed, but having these plans now prepared and ready to be executed, that gets us on the ground, actually do things on the ground to improve water quality. So, for example, I know of a couple of subdivisions that have streams that go through them that are in the 9th District. Who would be responsible? Could they call the extension office as far as getting these streams, maybe someone to test these streams to see what's in there, or how would that be accomplished? Have them contact me and let's find out which streams we've got data from, find out whether or not we've got data from those particular streams. And, again, we can tell if it's been a stream that we've got data from, we can tell them what pollutants are there and, again, what we think the sources are. Again, as Charlie has done presentations on upgrading the sanitary sewer system, we know that from time to time we have problems with sanitary sewers that are causing water quality impacts within our streams as well. So some of that will go away as Charlie implements improvements to the sanitary sewer system. But just have them give me a call or shoot me an e-mail, and we'll be happy to find out what we know about the streams within their neighborhoods. Again, reaching out people at the neighborhood level is really critical for us. That's where the action takes place. Okay, and one last question. What kind of budget do you have for this program? The water quality management fee, from that fee, we get approximately $545,000 annually. about $245 of that we pay out to Bluegrass Pride for their outreach in all the schools and the businesses and apartment complexes. My paid media budget is around $200,000 each year. And then the rest of that money we do a contract. We've been doing a contract with the Arboretum for a series of workshops. And then the rest of that money we use to help us with some materials, to print brochures, rain garden manuals, that type of thing. Okay. Thank you very much. You're welcome. Mark, before we go on, BMP is Best Management Practices, correct? Yes, sir. I apologize. Just want to make sure we didn't have a new acronym we need to add to our council acronym list. We're creating one for all of government, so just want to make sure we didn't have a new one. You're correct. Best Management Practice. Council Member Clark. Thank you, Chair. Mark, this is good stuff, and I certainly do appreciate what's going on here. And a couple of questions. First, I'd like to ask, who does the testing and the measuring of the stream qualities? That information we get actually from the State Division of Water, their response for supplying that information to the state. Charlie, is that correct? Yeah, we do some in Permanent as well. But that slide I showed earlier actually came from a state report. State report, okay, good. My other question is the permeable paving. How widespread is that, and is it effective? Because I've heard different reports on that. What we've seen so far with those grant projects, it's very effective. In reducing the runoff from a parking lot, for example, that water goes through that material and gets absorbed underground. A section of the Legacy Trail, for example, has that permeable concrete surface on it at Coldstream Park. and you can go out there at different times of year and you can actually see that in action, if you will. So our feedback so far, it works. Okay. Are there certain rewards for people to add that to construction projects? We don't have what I would call an incentive program for, like, what we would say, maybe green businesses. But again, through that water quality incentive grant program, and we can work with businesses to enact some water quality measures to reduce the stormwater pollutants. Good. That might be helpful. Good. Thank you very much, Mark. You're welcome. Thank you, Chair. Thank you, Council Member Clark. Council Member Scotchfield. Thank you, Chair. I will say that my children's school that's also in my district, Athens-Charlesburg, with Bluegrass Pride, did a watershed project, which is they installed a water garden, and I think we're doing a great job, especially reaching out to the younger kids in the elementary schools, teaching them about the ecosystem around their schools, and they've done a great job with that. And talking about putting a walking path in at the school, we've looked at permeable surfaces to be able to do that because it does help with runoff. One of the questions that I did have is we talk about reporting on companies that might be doing hazardous things to the watershed. What about citizens reporting on private citizens? Is there anything that they can do for those? Is there a reason you're sneaking up here? Now, we will take complaints from citizens, depending upon what the situation is. If you've got a private property situation, that may be something for code enforcement to take a look at, for example. Maybe something else going on that may get referred to Charlie's Shop. That just depends. But, again, if a citizen sees something, we want them, obviously, to report it to us. I can let you know that tomorrow we'll be having a news conference to talk about anti-litter outreach. Again, to try to get citizens, one of the tools we'll be using is citizens to be able to report someone that they see throwing something from a moving vehicle. So that would be a good tool for us to have. And I guess that was a follow-up question. Is that, you know, one of the things that we see a lot of in my district is just trash on the side of the road that people are throwing out their windows. So there will be some type of a public awareness that they can report that if they see it? Okay, great. Council Member Henson, you're back up. Thank you, Chair. Just real quickly, I wanted to say, Mark, that I think any time as citizens or whoever might see a truck leaking fuel, a garbage truck spewing trash, whatever the situation may be if we're out and about around our city, if you could identify that vehicle, that company, a number on the vehicle, whatever, I think that's very helpful to really get, you know, and as hopefully, maybe not in our lifetime, But, you know, as time goes on, we will just see more and more and more improvements. But I just wanted to mention that. You're absolutely right. You know, this is not a problem that government alone can solve. We have to have citizens involved and engage with us. And the more eyes and ears we have out in the community, that just helps all of us to get to that goal. You know, we didn't get here overnight, and it's not going to go away overnight, but working together and giving a little bit of effort, I think we can get there. Any other questions from committee members? Councilman Clark. One more question, Mark. Talking about the state testing the water, how often is that done and how up-to-date are our figures? The map I showed you was prepared in 2010. That would have been based on, what, 2008 data? Yeah, but some of those designations are much older than that because they move around the map. So it's obviously a very large task to measure all that. It is. They move from one watershed to another, and not only throughout Fayette County, but throughout the state as well. Right. And that, you know, from an implementation standpoint of some of these watershed plans, that's some of the concern is how current is the data. Exactly. So you get a lot of WaterWatch or local grassroots organizations, organizations, some of the very public folks that Mark and his team deal with on a regular basis that are supplementing that data to try to make sure that we're honing down on the right pollutant. Okay. I guess one of the reasons I ask is I was trained to measure, to test some places close to my neighborhood, and I was thinking I hope people are more competent than I am. Thank you, Mark. Well, you know, you've raised a good issue, and as Charlie mentioned, you know, one of things I like about my job is I get the opportunity to work with people out there in the neighborhoods, on the street level, and they're engaged. They want to do things to help us improve our environment. So that's the great part of my job is I get to work with folks who want to do things to help us. All right. No other questions. I do have a couple myself. You had mentioned your budget is the $545. Yes, sir. That strictly only comes from stormwater fee? There's no money that comes from the sanitary side for education? I do have a small amount of money that comes to me from the sanitary sewer fee as well to do outreach. Is that in addition to the 540? That's in addition to the stormwater fee. So what's the total budget for the whole program? I'd have to get my budget and get it to you. Okay yeah if you don't mind I was just curious about how we're spreading it out because I think it benefits both programs effectively. And then on the anti-litter press conference tomorrow. Specifically, how are they focusing on cigarette butts? I know that's a big stickler for a lot of people in the community. You hear some people honk their horns at people, and when they see them throw it, some people don't think it's littering. They just think it's okay. What are we doing on that type of campaign? Are we addressing that issue at all? We've had some paid outreach with cigarette butts the past couple of years, some of our print ads. We had some TV ads running about a year or so ago, and that again was in conjunction with Keep Lexington Beautiful. Keep Lexington Beautiful has been fortunate enough the past two years to get grants via Keep America Beautiful to implement some cigarette litter prevention programs. We did one the first year targeting hospitals. Again, they've gone to smoke-free campuses, but that just moves the transition point out away from their buildings. And so we worked with hospitals the first year. Last year we worked with some downtown restaurants and bars. Again, we provided them via the grant with some ash urns as well as pocket ash trays for their employees. So we've been trying to target cigarette butts via the grants we've been getting from Keep America Beautiful. And then in addition, we've been using some of our stormwater fee for paid media outreach with some ads. Very good, sir. Thank you, and thank you, Susan Bush, for all your efforts in leadership and getting this underway too because I know it's been a group effort and everyone else that works with you, Mark, They're great when they're out in front of the community, and either whether it be shows or in front of a neighborhood association. And I would encourage my colleagues to have you all out to those associations because that's where the front lines of the fence is and getting the residents to help us understand what it is we're trying to accomplish with that $4.50 fee they're paying and the senator's sewer fee. So thank you for your work. You're welcome. Thank you very much. Next on the agenda, we have a presentation on Empower Lexington, actually an update from a presentation last year. And, Councilman Raquel, you had placed this into committee. Do you want to say a couple words before we get started? I would like to. Thank you, Chair. This is just to remind council members and people who may be watching. A year ago, when the Empower Lexington Plan was presented to council, part of the language of the resolution said that the Division of Environmental Quality and Public Works will report to council annually, and there's really three pieces, progress toward obtaining the Empower Lexington Plan goals, so a set of goals within the plan, on actual reductions in energy usage, and, three, on actions taken by the Urban County Government to reduce its energy consumption. So my understanding, again, from the plan is that we will be getting today primarily information about what the Urban County Government has done and that in, I believe in May, this coming, is it April or on the May meeting, that there will be a subsequent report that has to do more generally with the recommendations in the entire plan. I don't know. My understanding was that this was going to be done in two parts and that this is the first part. Is that correct? We're anticipating late summer for the second part, but, yes, it will be a two-part presentation. Okay, I guess I understood it was going to be April or May, but we can talk about that. In any event, there is an intention to monitor the recommendations to ensure that the plan is either moving forward or if it needs to be modified, that it's modified. And what urban county government does within itself is one part of that, but the intention is to tie that eventually to the larger goals that are in the plan. So having said that, I'll turn it over. Thank you. I'd like to welcome now James Bush, our Energy Program Manager. Mr. Bush, welcome back. Thank you. Good morning, Mr. Chairman and Council Members. I will be giving an update then on the Empower Lexington plan. Empower Lexington was developed by community stakeholders to present recommendations on reducing energy use in the community, making Lexington more sustainable. When council passed a resolution in support of that plan, they asked for an update. I will be speaking on the latter part. These are internal activities by government operations related to energy use. For those of you who don't know me, I am James Bush, a trained engineer and a certified energy manager. That is the role I perform for city government. Energy management, though, is a game of inches. There is no single dial or valve to turn, and it requires the coordinated activities of people across divisions at all levels of operation. Don't hit that button. Excuse me one moment. You can kill that. Thank you. All righty. Let's see. I chair the energy team. This is our forum for discussing, sharing ideas, and discussing issues related to energy. What's important here is to see a broad cross-section of the government having a conversation. Slightly half is what I consider operational. These are the end users. The other half is more administrative. When we need guidance, either legal or questions regarding procurement or perhaps an impact on a budget, they are at the table to answer these questions and move our programs forward. Our facilities, as you may be aware, are very broad and diverse. They range from the energy emitted from a single street lamp down to the large air handlers and pumps at our water treatment. The categories here are strictly associated with energy use, so they could differ slightly from a report, you know, the number of parks or number of buildings. Utilities, likewise, we're handling about 1,500 accounts each month that need to be organized across the two electric companies, natural gas and water. That, of course, requires computational software. The city uses EnergyCap, which is an enterprise-level program. It's largely a relational database. However, it has a very sophisticated front-end, a user-friendly graphic so that we can actually see the energy. We spent a lot of time in its development so that you can see it organized physically, that is, in the facility that uses the energy. You also see it reflected in the bills that pass through accounting. And then lastly, arranged by budget, which pays the bills. So energy cap is trilingual, so we can have a conversation in the same language. The first steps and big success we had was in our rate review of the tariffs. This is where we're comparing the energy we use, how we're using it, with how we purchase it. On natural gas, we went from a variable rate to a bulk rate at a fixed term. That was very helpful when you're trying to forecast budgets and estimate how much it's going to cost for a given year. On the electric side, there was a discount for electricity being used in the public space, like traffic control devices, some details on contract capacities, and then the large success came in our commercial accounts. Where the smaller ones, we were able to move down into lower tariffs. Some of the larger ones were moving up. The impact on this in each of those different programs, we changed over 500 accounts to different tariffs, and they are now saving the city more than $600,000 each year going forward. The latest 12 months, we've spent approximately $11.5 million on natural gas and electricity. Approaching half of that is with streetlights and traffic signals. I highlight this because that piece of the pie, not only being the largest, but it's also associated with what I call a fixed cost. Those are we rent our streetlights, so that is not an asset we own nor one that we can modify. We spend approximately 20% of our dollars to transport and treat water. And then the remaining third is spread across buildings and non-buildings. When I refer to a building, it's where the floor area is a useful metric in normalizing energy use. Non-buildings are the distributed energy, such as lighting in green spaces, golf courses, and pools. Taking a closer look, I wanted you to get a feel for where the energy use in the buildings are going. This is a benchmarking chart. Each bubble is proportionate to the amount of energy being used in the facility. The three largest are the courthouse plaza, the detention center, and this building, the government center. The remaining 119 buildings that we pay the bills for could fit inside those three bubbles. So from a perspective standpoint, it is important to recognize the order of magnitude between them. On the bottom, the scale there is normalized. So it would be an index, the use per square foot. The box on the left would give you an idea of where you would expect a typical office building. This would be a 9 to 5 office located here in the south Midwest would be in that building. There's good reason that each bubble should not fit in that box. The detention center, of course, is a heavy 24-7 type operated building. What we do know is each of these bubbles should be able to move to the left. How far becomes both a cost and engineering decision that we need to manage. Mr. Bush, could you tell us some of the acronyms up there, some of the abbreviations? Yes. D.C.'s Detention Center. G.C. Government Center. Courts refers to the new courthouse complex buildings. And then you have HQ, that would be police headquarters. DAC is the Downtown Arts Center. And Murph is our recycling facility at Thompson Road. Very good. Thank you. The past few years, most of our major retrofits have been done through grant monies. In 2009, the city received $2.7 million in stimulus monies in an energy efficiency and conservation block grant. approximately half of that 1.3 million was invested in our buildings and energy management equipment the two largest were hvac replacements at the dunbar and black and williams community centers and we had an air handler and chilled water upgrades at police headquarters then smaller retrofits more lighting and envelope and the purchase of the energy cap software Could you go back one slide? The red box, can you explain that and C-B-E-C-S? Yes, Commercial Building Energy Conservation Survey. That is done by the U.S. Department of Energy. And what they provide then are indices that are indicative of a particular building, depending on how it's used. Is it office? Is it retail? Is it a grocery store? And where it's located, because building use is obviously dependent on the weather that it's located in. So I present this range just as one indicator of where a typical office building in the south or midwest, you would expect it to be right around 80,000 BTUs per square foot. That's annual energy use per the floor area of the building. So we want all those bubbles in the red box eventually? No. There's good reason each bubble would not. A community center only operated nights or half days should be on the other side of that box, whereas the detention center, I believe the indice for a 24-7, essentially a small contained city, is typically right around 140. You're at your peer benchmark. My point in benchmarking is not to worry about how we're doing next to the next guy. I want to know, is this reasonable for the building we have, and we know we can do better. Even our most newly developed buildings can be improved, but it does become a cost issue. Very good. Thank you. Please proceed. So we can move here. As contained in our application to the Department of Energy for the stimulus monies was an energy improvement fund. This is a revolving loan. It was authorized then by council. And what we're doing is using the verifiable utility savings from projects to invest in the next retrofit. It's a simple concept. The mechanics in a year-by-year budget situation are more complex. But I think you can understand when you're looking at an efficiency-type project where you might anticipate a 10% to 30% type reduction, it will take multiple years of those savings to pay for the upfront costs of the initial project. Now, why have an energy improvement fund? It's good business. This is a cost-neutral program. Whether you've updated a piece of equipment to use less energy or you've gone to a more effective rate structure in your procurement of the energy, those costs would have otherwise gone to the utility company. Using an energy improvement fund, it stays within the city government to be reinvested in facilities. There's a peer review process in place. The energy team looks at the business case for each of these projects to review how much it's anticipated it's going to save, how are we going to demonstrate those savings, and can it pay those funds back from the loan. And lastly, and probably most creative, there really is in our system, there's neither penalty for using too much energy nor reward for using less energy. So this gives divisions a reason to participate. It is a pool resource, then, that can be used to improve the facilities. On the transportation side, there has been similar success with fleet services. Just last December, they were awarded a State Green Fleet Award. and some of the criteria then is their use of biodiesel in the city vehicles. The city has the state's largest fleet of hybrid automobiles. They use their own management software for monitoring fuel consumption and use across the vehicles. There's route optimization to conserve fuel in the waste management sector as well as a no-idling policy. More recently, a Chevy Volt was purchased with a public charging station located at the Picadome area. They are heavily moving towards compressed natural gas for the waste fleet and revising the fleet CAO policy to promote a right sizing in the next vehicle that the city purchases. In summary, I hope it's been demonstrated that energy management is not a one-time event. It is a continuous process that needs to be reviewed and continually maintained. The good thing is we are doing it in-house, using a systematic process and demonstrating results. We have established an energy improvement fund. that's a very innovative device, but it allows us to improve our facilities in a fiscally responsible manner. Now, all programs, if you're going to monitor their effectiveness, you do need some sort of baseline. This is my only slide relating to the community-wide numbers, but the baseline then has been done using data from 2007. So this is the emissions attributable to the actions of the community as a whole for Lexington. There were 6.5 million metric tons of carbon dioxide equivalent emitted, normalized by population. That's 23.4 tons per person. The government operations represent approximately 2% of that total, and an emissions inventory using 2011 data is underway. Of the $11.5 million that we spend on gas and electric that are presented earlier, here you see the trend history of that in the green bars. You'll know from 2009 to 2010 there was a substantial increase. That summer is when KU was approved with a 10% rate increase. It's one of the largest we've had. By my estimates, that 2010 bar would have been over $12 million had we not initiated that rate review and brought in some of the early changes in rate tariffs. These are gross numbers. So regardless of buildings have come and gone, they do not include weather fluctuations. The blue line presents the energy use. It was relatively flat for the first few years, and then we've seen a drop in 2011, 2012, likely due to somewhat on operations, but warmer weather and the shutting of a few facilities, most notably would be the three or four parking garages that fell off six months of the 2012 data. What I want to bring your attention to, though, is the bottom. So in red, you have the cost per unit of energy, and what we're facing is year after year increases in our rates. That blue line, had we just done a linear regression through it, would have shown a 1.4% per year reduction in energy use. I do not present this slide as trying to pick a winner and a loser in category. What I'm trying to stress is the importance of normalization. Again, I think you can understand that with a growing, vibrant city, if you have more wastewater to treat, if you have weather events and just general growth, putting, say, more streetlights on the street, you would expect to use more energy. The importance here is that some sort of normalization, while keeping an eye on the gross numbers are important, some sort of normalization is needed. As an example on the building intensity, we commonly normalize by square foot. This data is normalized also by weather events, so that's been taken out. What you would see over the five-year trend is an increase in the intensity of our energy in our buildings, shown by the top of that bar chart. Now, we also know that in 2010 there was a significant expansion to the operations at the recycling facility. The 2012 data at the MRF is nearly twice what it was in the four previous years. and likewise due to drift at the courthouse plaza complex, we were seeing a 12% increase 2012 versus the previous years. If you exclude those two buildings as represented by the blue bars, you are seeing a slight year-to-year decrease in the operations. That's where we want to keep our focus on, and we also have met with the management company for the Courthouse Plaza to see what they can do to tune up the courthouses here in the coming year. So looking forward here in the next year, we will bring water utility into our management domain. We're working with purchasing to standardize the efficiency criteria for the purchase of mechanical and electrical equipment across divisions. We will be initiating energy improvement fund retrofit projects. On the fleet side, the use of compressed natural gas for the heavy waste trucks. And lastly, an electric vehicle demonstration. Thank you, sir. We have a couple of council members already signed up for questions. Council Member Myers. Thank you, Mr. Chair. Thank you, Mr. Butch, for an excellent presentation. A couple quick questions on the streetlights. Can you go back to that slide that shows the pie chart, annual gas and electric usage? You noted that we rent our streetlights. Do we have a policy or a plan in place to ensure that KU uses the most efficient lights? We do not have a policy per se. We have had aggressive negotiations and conversations about that topic. You probably read and we hear a lot about the use of solid state lighting, the LEDs most commonly. The development of a rate tariff when KU presents their information to the PSC as to what is a reasonable rate for a particular technology, it is heavily biased towards the upfront costs. given that solid state lighting is more expensive than conventional lighting. The rate at the moment would be greater than our current procurement. And the LED lighting, that's really expensive, but there's some variations in between there that might help out. There are. The traffic engineering does review the type of light being used. It depends on the speed of the road in the neighborhood. as well as spacing. So they review and defer to a Department of Transportation guidelines for the amount, the foot candles we want on the ground, and then what options we have with KU. There is a slight range in terms of the aesthetics of the particular light, but the lumen output, even non-solid state, is quite efficient, not always pleasing to the eye if you know those yellowish tints. but highly effective from an energy standpoint. So what becomes a bigger portion of our costs, or I should say the embedded costs in that rental rate, is really the maintenance of the light more so than energy. What portion of the maintenance do we pay? If the light goes out, do we have to pay for the new bulb? Is that what you're talking about? No, we pay a flat rate for that light whether it's on or not. So we do encourage homeowners community to make KU aware when a light is out because we're going to pay for that whether it's providing its service or not. But no, we do not get a line item charge for bulb replacement or maintenance. What's the maintenance fees usually about? I'm going off memory, but I believe the maintenance comprises 20 or 30 percent of the cost. I mean, what is the maintenance that's done that we're paying for? I'm sorry. Oh, if poles are knocked down, they're put back up, primarily bulb replacement and ballast replacement. Damage would be the other. The nuance would probably be the downtown Granville streetlights. Those do require a little bit of painting and such where the aluminum poles out on most neighborhood areas require relatively little service short of being knocked out. Okay. And then on the cost-saving measures, and you talked about you had an example of saving $600,000 that we were able to put into other cost-saving programs. What is your process that you have established to ensure after you say that we're going to save $600,000, that we actually realize that savings? I'm sorry. Could you rephrase the question? Okay. Let me try to find that screen. There's a screen where you had, yeah, there you go. Okay, thank you. Okay, so then there's more than $600,000 in avoided costs each year. And you talked about that $600,000 gets to stay with LFUCG, and then you reinvest that into other cost-saving measures. Am I correct? That is correct. So how do you go back and substantiate that the cost savings was actually there, and then how do you monitor to make sure that the cost savings, the strategies that were put in place to save that are continued, even when new employees come in and those kinds of things? Sure. With regard to tariff changes, which is what this is, it's relatively clean. There is a formula that it applies to every bill that based on the amount of energy you're using, that the amount you'll pay is just determined by an equation. So for moving from one rate to another, you're simply applying two different equations. I got you. I'm sorry. I thought that you were saying that there were certain things that we could do in-house, like if we changed all our bulbs to a different type of bulb and we would have that. That's correct. Those are on the operational side. They are not presented in this slide. These projects are the ones we're monitoring from an operation side. We removed boilers in the community centers and now have a variable refrigerant technology, which is more efficient from the heating perspective, but all of which are, by and large, only have about 12 months of operation. So we do want to see that demonstrated in the utility bills before we claim a savings associated with them. Those changes are big because once you change out a type of heating system, then it's changed out. But I remember a few years ago we did, across government, tried to do away with inkjet printers, for example. those types of cost savings, once they're captured, how do we ensure that those things stay in place? The tuning and retrofit does get back to the indices that I referred to, and the bubble chart is a good way. By keeping an eye on that intensity of the use per square foot normalized by weather, It's drift is really what I'm looking for. And the courthouse plaza is a good example. We've been seeing that bubble drift to the right over the last three or four years. Outside of any other explanation, it tells you that it's time to reinvest in a tune-up, either on your boiler or your chiller system. Maybe there's a contaminant problem on the water. And sometimes people have been increasing their set points because they want a warmer, cooler environment. So we do have to keep a lid on that. It's a line we walk. You don't want to be too heavy-handed because you do need occupant involvement in all of these activities. But by keeping an eye on these metrics is how we keep our entire portfolio tuned up. Okay. Thank you. You're welcome. Council Member K. Thank you, Chair. Thank you for the presentation and for all the work that's being done. I think we're moving in the right direction, making progress, and that's really important. I do have a couple questions. The first is on the one slide that had to do with the larger report. You mentioned that you're making progress on developing the greenhouse gas inventory for 2011. Can you tell me more about where you are with that and when we might expect that that inventory would be complete? Okay. Yes, the real drivers in the emissions are already in. This would be the data from the utility companies. They've been very cooperative in this regard. The numbers I have before me show a 7.5% decrease in electricity use and a little over 1% increase in natural gas. But the transportation then on vehicle miles traveled is down about 1.5%. So just knowing the electricity and transportation have gone down, it really leads towards we anticipate a decrease in the emissions for 2011. The details as we get into the waste components, composting amounts, tonnage to the landfill, and dividing those out will take probably another 30 to 60 days. But we do anticipate having the 2011 inventory done here. That would put me just in May. Okay, so we can anticipate within the next couple of months that that inventory will be complete. That's correct. Great. The reason I ask that question is that there is a goal in the plan for a 1 percent per capita per year reduction in actual energy usage. And until we have that inventory for 2011 as a baseline, we won't know whether we are making progress overall to that level or not. So it's an important piece of the overall puzzle. I guess just a decent question, a couple of comments. There are, in addition to the specific activities that the urban county government can do in-house to make a difference, there are scattered throughout the report numerous recommendations about actions that we would plan to have LFUCG take in order to move other aspects of the plan forward. And part of my concern is how both of those things, both the extent that urban county government is making progress and the extent to which it contributes to that 1% goal, and the information about what else urban county government is doing, is moving other elements of the plan forward. And, again, I gather that that will be included in the report that will come to us now. Now I'm hearing late spring, early summer. But the reason this is on the agenda is that there was a commitment at the time that the plan was passed to review the plan annually. And so I'm very interested in having any information that's presented tied back to the specific goals in the plan and how they contribute to that overall reduction. And I guess we'll hear more about that, I guess, in the second part of the report that comes to Council. But thank you for your effort. Thank you, Chair. Thank you, Council Member Kay. Vice Mayor Gordon. Thank you, Mr. Chair. Thank you, James, for your good presentation. And I wanted to go back to the annual gas and electric slide. Council Member Myers had some questions on this slide, and I also do. it's the pie chart pie chart, okay forward, there we go when you said that you said we have lots of upfront cost and I believe you said that we pay a flat rate whether the light is on or off is that electricity charge or is that flat rate, what is that? It is most easily thought of as a rental fee. So it is a rented service for the utility company to maintain and keep those lights shining. So that's basically our light bill. That's correct. Correct. So is that negotiated through the franchise agreement? It is not. It is not. That is, those rates are set and approved by the Public Service Commission, and you have an a la carte of here's the lights that they are willing to install and maintain for you. And, again, you match that then with a particular roadway that you want to illuminate and select the light that's most appropriate for the situation. And I may have missed this. You might have said this. but how often are those rates negotiated? It varies, but lately we've been seeing about every three years that a rate case will go through. In between a rate case, you do still have fuel adjustment charges and environmental charges, so you won't just see variance every three years. We tend to see year-to-year variance, and we have that conversation when we make our budgets. So it seems to me, and maybe you could verify this, that KU has no proactive approach to look for streetlights that aren't working. Is that a fair statement? They're relying on our citizens to tell them, or do they have? They do have, I don't know formally, but they do have in their policy, as their trucks make runs, they are instructed to keep an eye out. But obviously, if you're making runs during the day, you will see lights that are going to be off. Well, I mean, I suspect other council members have experienced this, but recently in my broader neighborhood, there was one corner, which it was kind of what I would call the big corner, a big corner where four lights were out for several days. And so we're still paying as if those lights are on, correct? That is correct. Well, how can we? I think that's not right. I mean, we pay when we still don't get service. So we're relying on citizens. I mean, I called it in, and they got replaced. But we rely on citizens to do that. And citizens, I mean, is that built into the contract? Or it just seems wrong to me that they don't have a night team that would go out and kind of. And this isn't your problem. I realize that. It's a good piece of our bill. I know we're in the conversation. We do receive a monthly report that they document how many lights were notified of being out and their response time. And generally speaking, their responses are on an order of a couple days to get a truck out and replace that bulb. So do we have any, and this might be a question for law, but is there anything built into these negotiated rates that says if you aren't replacing them within a certain amount of time or sending out a team to look at night or whatever, is there anything in them to hold their feet to the fire, or is it just we've kind of said, well, this is how it is and this is how we'll... I don't recall anything that specific. Again, their documented reports in terms of response time are at least reasonable, so I can provide some assurance that it's not a flagrant problem, but undoubtedly there are individual situations that don't recall. For the ones they know about. That's correct. There could be 50 out all over the community and no one's reported them, and they could just stay out. That is correct. So does law negotiate with the PSC, or does the PSC negotiate at all on these rates? Is it with KU? We do intervene on all of those rate cases. And the most recent one, it was originally presented in the 5% to 8% range on streetlights. We have very much noted our displeasure to the rising costs of streetlights, which are not necessarily compatible with our ad valorem mechanism for their payment. and the settlement was less than what was asked. It went from $82 million to about $52 million on that settlement. So percentage-wise, you get a feel for how much was compromised. But it is a struggle in that year-to-year rate increase environment. And just one last thing. How could we express our displeasure that there's no proactive approach from the utility to go out and find the lights that are out and replace them? Is there a mechanism we can do that? That is in the franchise agreement, a requirement that the utilities, if asked, will come before council and discuss their operations. then that would be a very appropriate time to ask them those questions. But we can't do that to the PSC? No. The PSC, that would, I guess I'd want to ask law, our ability to, I mean, we're certainly represented by our legal department, but if an individual wanted to present to the PSC, I'm not sure what form that would take. Okay. Thank you. Thank you, Mr. Chair. Thank you, Vice Mayor. Next up, we have Mr. Energy Efficiency himself and his big-ass fans. Council Member Farmer. Thank you, Chair. Yes, Mr. Bush, it's correct. We have replaced three fans in this chamber with two fans that are more ergonomic, made by a local company, big-ass fans, and we did it at no charge, which that's just a great way to start. To your excellent presentation today, I too had a question about the very slide we're on here. In all of this efficiency and carbon footprinting, I've become a real natural gas aficionado. I have no dice to natural gas other than that, which I produce myself. But why do we have so much electricity and so little natural gas in our footprint? We are, there is a heavy bias toward lighting. Is it? And the other thing, I try not to confuse, keep in mind this pie chart is based on dollars. All right. And so specifically with regards to the rental service, it's not, those pieces of the pie are not proportional to energy use. Those are proportional to dollars. And when you're renting a service and paying operations and maintenance, you're paying for more than just the energy. So if we regroup this by BTUs and electricity and gas, you would still, we're heavily dependent on electricity, but most of our use then is with lighting and motors and pumps rather than heating systems, which is really where natural gas is sweet spot. And very good fuel. I certainly like it for heating environments. At the same time, the older boiler systems became problematic not because of the boiler itself. It was the arteries that flowed through the buildings. It can become quite cost prohibitive to clean those arteries in an older, potentially hazardous material-containing building. So there again, electricity has an edge in that new wiring can be run more efficient with refrigerant compression technology. Thank you. I appreciate that. There was a lot of background in that. And then on the next page, what is our page 31? I'm just a connoisseur of nice charts. I think this is a great chart. It gives you some information more than usual and shows where certain buildings are. I appreciate the size of some of those bubbles and what that must mean in commitment of dollars to keep places running and well. Then on page 35, which is your fleet initiatives, which brings me back to my – there you go. Moving towards CNG. So we've made a commitment to more than move towards it to actually kind of get there, in my estimation. Do you want to shout any on that, or are you good to go? The latest information I've heard is a commitment to a permanent fueling station then in the Bird-Thurman area. This differs from what was originally going to be a temporary station. Good. So I guess you and I are hearing similar news. Thanks. My immediate question was, because I'm worried about the new load, was the size of this, and that, to my knowledge, has not been scoped yet. In other words, how much natural gas does it require to operate a given waste truck? Oh, interesting. Well, I mean, we did have part of that in one of our presentations about how much less it would be per gallon as well as how much less the maintenance would be. But maybe to your exact point, not the total answer, but one that we should follow up on. Then, again, back to chart stuff. This is on page 40. It's your building energy intensity. And then I just, tell me one more time, normalize the 2010 weather. What does that mean for that bar chart? If we did not normalize each year, what you need to do is pick a typical year, and it could be anyone. What we do know is the winter of 2011, 2012 was quite mild. Okay. So that's an anomaly with regards to energy consumption. I somewhat arbitrarily selected the 2010 year for normalization. So what the software does then is it calculates how much energy a building uses based on heating and cooling degree days, and it applies that same weather pattern to each of your years to tell you if you're using more or less. It cuts out the variance related to weather. So generally speaking, how would this appear without that normalization added to it? Then 2011 and to a lesser extent 2012 would be smaller. Okay. All right. And it gives a misleading impression then because you'd say, oh, we're doing good things. The bars are going down. But in reality, it was just a lot mild. This brings you to kind of a standard deviation, strikes me. It's by knocking out the highs and the lows. Yes. And then on the next page, and I think this is my last question, again, you said CNG waste trucks. I think there's other fleets out there of ours and others that could use CNG. There's buses of all sorts. I'll defer to the Division of Fleet Services, of course, for an expertise, but what I'm hearing is there is a slight bias towards the heavier vehicles benefit more. and that there is conversation of a partnership with LexTran using the same technology. I think right now the country as a whole is going to be in a pinch because the historic low cost of natural gas at the moment is driving a lot of communities towards this technology, and the lead times on the equipment are extending. We'll get there. But I think to quantify that, I believe the purchase of five or six waste trucks are in the immediate plans for Lexington. Yes, that's what I've heard, too, and I'm very appreciative of that. And then the top one, water utility management, define that for me again. Well, right now, that's a void. Okay. And it was noted when I came on board. I knew I'd be busy with the gas and electric. But we do not receive our water consumption numbers from Kentucky American Water. That will change as they move to a new system in May. And in a conversation I had yesterday, we should be receiving some test files in June. The software I have is fuel neutral, commodity neutral. So it will accept water, and I will bring that under the purview of our tracking. So rather than the dollars that we managed today, we'll bring in the gallons of water, and we'll do, again, normalization indices to see what's appropriate for a park fountain versus a building with X number of people in it. But right now it is somewhat of an unmanaged commodity. Appreciate your work and your report. Thank you, sir. Thank you, Chair. Thank you, Council Member Farmer. Council Member Sketchfield. Thank you, Chair. I just, the side on the top 25 buildings, I'll have to have Council Member Farmer school me in the energy efficiency. I'm trying to get up to it. Obviously, district court or detention center and the court system, they take up a lot of our energy. They're newer buildings. I mean, compared to government center police. Correct, correct, correct. And I guess what I'm trying to do, how do we prioritize where we're retrofitting? And follow up to that, when do we decide that a building has outlived its energy efficiency? When is it time for us to look elsewhere? Great question. The general services takes a more holistic view at the building property because what you need is essentially a dollar per square foot, but incorporate all the costs. I'm only showing you energy management here, but they have what are the costs of the cleaning services, the roof repair, general maintenance on the facility. So they add all those up and have similar charts to know which buildings are costing us more on a square foot basis than would otherwise be necessary. With regards to prioritization, that is a difficult one. Ideally, I'd like to optimize, and you'd start on the right-hand side and larger and just move down into the left. However, the age of facilities and equipment failure often dictates which one we're retrofit as well. A great example is the Dunbar Community Center. I don't think it was widely known that that boiler system had failed in the end of the previous winter. and come the winter of, I believe it was 2011, there would not have been heat in that building had we not diverted then our stimulus dollars towards it. So not only did we get a new heating system in, but the entire gymnasium, there's four air handler units in the gymnasium. It became our heat shelter for that next summer, which had historic highs, and we used it for a handful of days for the community. So there was quite a bit of success there that I think went under the radar for Parks and Rec. So in that vein, it sounds like a lot of times our priority goes to the necessity rather than kind of having a checklist. That is the – we have a checklist, but the deferred maintenance is catching up on us. You know, we've been operating quite lean in our maintenance and operations now for a number of years, and it is catching up on general services. So, you know, I hope you're very supportive of their budgets, but there is a lot of work to be done. Thank you, Chair. Thank you. I think Councilman Rosati can't log in, but she had a follow-up on this same topic, and then it will be Councilman Relane. Thank you, Chair. Yeah, basically what Councilmember Scotchfield said, I would assume that the newer buildings, wouldn't they have to be LEED or somewhat LEED certified? Yes, it was an executive order that asked that all new buildings of significant size be made to LEED. Our newest construction was the LEED, sorry, the LEED, the Lyric Theater, which was a LEED Silver, if my memory's right. It is the bubble, I believe it's the one just below the number 60 there. It's coming in around 55 KBTU per square foot. And then Raven Run Nature Center was, I believe, at least going after LEED, a much smaller facility in scale, but it has outperformed the early estimates. So basically all new developments that are going in have to have some type of LEED provision. Is there a certain... That's the attitude I'd like. That's the attitude or is that... It was an executive order from a previous administration. So it's not followed through for this administration? I do not know the answer to that question. Can you find out about that? Because I think that's pretty important. I mean, if they're going to build something, you know, lead certification will save us a lot of, up front it's a lot of costs, but down the road it'll save us a lot of money. It would be helpful to all of us to have a clear answer on that. I'll find out. Thank you very much. Thank you, Chair. Thank you, Council Member Marsati. Council Member Lane. Thank you, Mr. Chairman. First, I'd just like to say that your presentation today has been very good. and I give you the highest rating for any performance I've ever seen here. You've done very well. I've got a couple of questions for you. The energy improvement fund that we have, was that initially funded by an ARA grant, and then we're recycling that money, or did that money come from some other source? It was not directly funded by the ARA grant. We did, conceptually, it was the seed money for those community retrofit projects that were now monitoring their performance and then to transfer utility savings to the Energy Improvement Fund. The bulk of the money in the fund, though, did come from tariff changes. Do you know approximately how much you have available at this time? Approximately $300,000. Okay. Okay. Under your report, you showed there were 1,193 electrical accounts and 306 water accounts. My question on that is, when that bill comes in, does it go to your department and you review it, and then it's allocated to the appropriate real estate property or electrical use? How do you do the bill? We have a parallel system right now. So we do not work from the same database. Accounts payable receives our bills via paper, so we still process paper bills. Thankfully, on KU's side, they do not process 1,100 bills each month. We use something called collective billing, so bills that should be paid from the same budget are all rolled under one collective bill. I believe there's roughly 30 collective bills that come in for KU. Within them are 1,000 accounts. They do their thing. So the paper billing, paid from the appropriate budget, tracked in PeopleSoft. I receive an electronic spreadsheet, if you will. So it's a proxy of that information. I receive that direct from the utility companies. I enter that, upload into EnergyCap, and I conduct audits then. And when I see variants and alarms pop out, I contact the appropriate, be it accounting or general services, say something's a little funny in this bill, let's make sure that's accurate, do your numbers jive. And then the second cross-check we have is a quarterly budget meeting where we're looking at PeopleSoft payments through the year, which should decrease from 100% down to zero. I do the same thing within energy cap, and we reconcile disagreements at that point. Because bills can be paid from a wrong budget now and then, or perhaps I'm tracking it not where they're paying it. Again, we just need to reconcile to keep our systems on tab. Long term, finance has expressed a desire to move towards electronic billing, both for the labor savings in-house. But what that will do then is to give us the opportunity to pull directly from the same database. So there would be a single electronic file that contains both your financial information and your energy information. Budgeting needs their part. I need my part. And we'd be reading from the same page. But that will be a long-term goal. The software we purchased is compatible, is compliant with that. Well, you also mentioned a minute ago that, you know, preventative maintenance and just regular repairs and service, how far back in the hole are we on that? We're way back. I mean, for example, for Hegan Air Conditioning Systems for our buildings, do we have regular service on that? Larger buildings, we're moving towards a service contract model because of the decrease in staff that they've had in general services. So certainly the courthouse plaza is maintained. They have an on-site staff there. Detention, what I heard recently is when we had a new building, there were 11 technicians maintaining that equipment. Now we have an old building with four technicians, so we're kind of working in the wrong direction. But they, too, are then looking to outsource that maintenance. If you saw an excessive water bill or electric bill come through for a certain property, what's your procedure for responding to that? First, I verify my information is accurate, and I can contact the utility company and or look it up online, have those resources. And then the next question is, was this somehow our own doing? And so then I need to get in touch with the end user, the operator, to say, do you know you were using this much energy out there? An example I'll give was at the West Hickman treatment plant. We've seen a fairly significant increase in natural gas use this winter, and I called to inquire why, and it turned out as part of their new blowers, they require more air, more volume, and they're using more gas. So there there's a relationship that makes sense. We would pay that type of bill. When there isn't, we need to investigate further. Was the meter reading accurate? Oftentimes that is the case for a high reading, and the utility companies, of course, will correct things on the next billing cycle. Let me thank you. My time is up. I appreciate, again, your presentation today. Okay. Thank you, Council Member Lane. Council Member Myers. Thank you, Mr. Chair. I just have two follow-up questions on the slide that has the pie chart again. Pie chart. Is it possible, and I know that you're not the purveyor of the franchise agreements, but is it possible that we can negotiate in the franchise agreement stipulations that would require KU to have a team that goes out and proactively looks for lights that are not working? I'm not sure what we are allowed to put into a franchise agreement and hold them to, as opposed to the rates with the PSC. Right. Right. My initial thought is if we're asking them to increase their maintenance, because, one, I do want to be cautious that they're not proactive at all, but if we were to increase their maintenance schedule in terms of how they drive, they would lobby then to the PSC that they be compensated for that additional cost, and our rates would go up. Well, let's look at it from the reverse position. Like, we have satellite TV at home. So if a storm comes through, satellite TV is unavailable. If I call my company, they will discount my bill the number of days or, you know, if it's an hour, they'll take a day off the bill because they weren't providing the service that I was paying for. So my argument to the PSC would be that we're getting charged for something that they're not providing us rather than allow them to say, oh, we have to do more now, so we want to charge more money. Does that make sense? It does. And that's a conversation I can have. I meet regularly with the KU representative. I can share your thoughts on that and whether or not he thinks there might be some room for negotiation. the first thing I'd want to do of course is to try to quantify the lack of service that's out there and again my understanding would be just a few percent at most of the 30,000 lights are off at any time now that would be known lights out trying to extrapolate beyond that I would expect some press back but we could I could investigate that possibility And I think that's part of the difficulty, too, is that most of the time I think when a citizen drives down the road and a light's out, they're wondering why the government doesn't replace their light, rather than why is KU not providing the service we're paying for. So the natural inclination to call KU and report the light being out probably isn't there, and we would probably need an educational program around that. The second question I would ask is, in that same agreement, can we stipulate that they have a certain amount of time once the light is reported to be not working to fix that light? I'm not sure that isn't somewhere in our agreement, but I would have to check. Again, their reporting does show the turnaround time is on the order of days, not weeks. Okay. Well, if you could find out those things, I know you might want to check with law, I guess, probably on that, and then maybe just send us an email would be perfect. No problem. Thank you for a great presentation. Thank you, Mr. Chair. Thank you, Councilman Myers. Councilman Farmer. Just a brief follow-up along those same lines. I know that sometimes it takes longer for a street light to be repaired than just to have the ballast or the light put back in it. You usually end up with a different color tape around the pole at a different place. but I know that KU does patrol to look and see if lights are out and I think they've also set up kind of a special link with our 311 folks to make the reports when they come in here available as quickly as possible. If there's a, this may require more conversation than I understand in terms of how many are out and how many are not being serviced because evidently, I don't know, from doing this job, If I see one out, I just report it and don't think about it. But if there is an epidemic or a situation that we need to kind of look into, I think certainly we should do that. But I found it to be very responsive, at least in my personal experience. Thank you. Thank you, Council Member Farmer. Council Member Henson. Thank you, Chair. And I just want to piggyback and say that I certainly think we need some sort of process because I know many times I'm out and I see a street light out, and they usually want an address, like where is it located, but I can say it's on this street on the creek bank. It's just very hard sometimes to identify, and those are the ones particularly that no one takes responsibility for. If it's in front of my house, more likely I'm going to call. But if it's in a green space along for Sales Road, no one's going to take that responsibility. You need to adopt a light program. Yes. Yeah, we adopt a spot in lights included. Thank you. You're welcome. I know Councilman Myers has one quick follow-up, and then we'll move on to our next agenda item. I would say that it's been my experience in our district that when we call, KU says that it's up to the homeowner or the property owner to call. That we've never been explained to us that they've got someone that actually goes out and looks for lights that are out. So, thank you. Thank you, Council Member Myers, and thank you again, Mr. Bush. We appreciate the presentation and all the work you're doing. You're welcome. Next on our agenda, we have hard-to-recycle materials. Also, I'm sorry, thank you, Councilman Roque, for keeping this on our agendas, and we'll look forward to working to get the second piece to us coming up here maybe sooner than late summer. Next, we have another agenda item, hard to recycle materials. We've asked if we could postpone this. So if it's okay with the committee, I'll entertain a motion to do so, and we'll reschedule. It won't be the next meeting because our agenda is pretty full that next meeting, but if I can have a motion to extend it. So moved. Second. We have a motion and a second. All in favor, say aye. Aye. Okay, that passes. So we'll try to get that back on as soon as possible. Last on the agenda, we want to get back to financials for all of our three major funds in this committee. Actually, there are three different ones on today's agenda, but we want to get to a quarterly, at least a quarterly reporting process. If any committee members would want to see it monthly, we'll see if we can accommodate that. But right now, going forward after today, we'll try to have a quarterly update on the financials of our large funds, of our urban service funds. So without further ado, who is going to present, kind of go over the numbers that we've requested in the administration? I see three or four candidates I can call on. So who wants the short straw or the long straw? What we kind of want to do, Mr. O'Meara, is just a brief overview of our sanitary sewer fund, our water quality management fee. fund and then the landfill fund. I know going forward maybe we can work on including waste management as well in their budget, but we just want to give an update on these big three, so to speak. So if you could, a brief update. Okay. I think I stood up too fast, but I would say that, do we have an updated set of? Okay. So the one in the packet was kind of halfway through the close of February. So we ran one that was through the month of January. And And seven months into the year would be about 58% if a budget was equal each month and linear. So that's what that percentage over to the side means, just to give you some sort of a reference point. And the fund is in a positive. The changes between original and amended are mostly rolled purchase orders or SCADA, which if Charlie wants to explain SCADA. And then we could go to the next one, which is the... Okay. Before we go on, I think Charlie wants to jump in there. And then also, can you talk about the fund balance at the bottom and the capital reserve and what those numbers mean? I will. Oops, I'm sorry. I wasn't dying to jump in. He just looked back there for me because I figured he was doing fine. He called me up here to explain SCADA. I think I mentioned that when we were going over the project list last meeting. That's a $14 million investment that we're making in our operational controls, computer systems that operate both of the treatment plants. as he pointed out, is that most of the changes you see from the original budget to the amended budget are basically rolled POs of active work that's ongoing, and that we obviously don't want to close those POs while we're paying those consultants and those other vendors that are doing work for us. I'll turn it back over to Bill to talk about capital reserves. To comment on net difference, which is almost to the bottom, or fund balance, the difference, let's take the year-to-date 131-2003 column. It's the third one over from the left. It comes down to net difference between revenue and expenses of almost $11 million. I would caution that that is not like an ending fund balance. That is an interim fund balance. We're seven months through the year. As you can see, there are still operating expenses and capital to be spent. So a good example is if you have a large influx of an expense early in the year, then that's going to put you into a negative fund balance interim, but you would be positive by the end of the year the opposite is also true. If expenses are delayed or if there is some seasonality in the revenues, again, those interim fund balances are not something to focus on at this point. At the very, very bottom underneath the original budget is the fund balance as of June 30-12, which was $4.8 million, and capital reserves for the 4003 account, We're 56.2. Okay, you want to jump to the 4003? And again, Council members, especially our new members, we have two different funds that make up the budget of about $65 million of the three for the sanitary sewer operations. The operating fund is the one where the actual major capital expenditures are occurring, And you can see at the capital line, more than three-quarters of the way down, the budget went from $16.7 to $56 million. That is the major role of the major projects that are underway. And again, you can see the net difference is currently at a negative, and that's because the funds are allocated out of $402 into the $403 capital fund by the end of the year. Okay? Do we have any questions before we move on to landfill and water quality from anyone? No questions. Keep going. All right, sir. Next is the landfill. And, again, I would draw your attention to the capital line. That was bringing forward the land closure reappropriation that was in last year's financials. So we brought that $4.5 million over. They are going through the closure right now with that reappropriation. And again, we have a net difference of $2.1 million year-to-date, difference between revenues and actual expenditures. But that is that year-end, during the year timing difference that I was talking about. Fund balance at June 30, at the very bottom of the first column, $11.1 million. Any questions on landfill? All right, keep going. All right, sir. Fourth is the Water Quality Fund, and that has small-dollar differences compared to the other two we just spoke to. They have a total year-to-date revenue from all sources of $6.7 million, with total expenditures of $5 million. So it's currently showing a net positive difference of 1.6, bottom of row one, the 630-12 budget, I mean, excuse me, unrestricted fund balance was 7.2 million. Any questions on water quality operating fund? I do have one question then. I know on our budget, we budgeted 10.9 million that we'll receive from the water quality fee. I know during the Water Quality Task Force, we had anticipated a larger number. Is this due to switching bills and LexServe, or have we seen a leveling out as to the numbers we used when we passed the fee weren't holding as high as we thought they would hold? And what has been adjusted in the original budget and water quality to make up the difference? Because I think it was around $12 million we anticipated getting. I believe that was 2012 budget. But this is 2013. We budgeted, I believe, the 10.9. You see the original budget and amended are the same. We budgeted less, anticipating the erosion in some of collections going off of the previous service arrangement to the one that we have now. So there was a budgeted decrease in total revenue, not knowing what our experience base would be. And we are analyzing that going into the fourth month, I believe, of making that. And I hope to have an update to Council soon as to how we are on all three funds under the LexServe billing. The second part of your question, as far as the average ERUs, one of the good things of the project, migrating from one service provider to the other, was a very thorough review. And we have found and made adjustments to the ERUs that we originally started billing and are currently billing. Now, whether that's a total net one way or the other, I don't have hard numbers. But I do know that it was part of the transition and that there was good review done there. Thank you for your candid response on that, because I just wanted to make sure we weren't giving up anything in the stormwater program because maybe we had less ERUs than we anticipated, et cetera. But the question we all get asked, though, and I'm glad Charlie stood up, is how much money of that fee are we going to start putting into projects? We're all getting a lot more pressure now that we've been to two years. We're waiting on when are we going to start putting these dollars, either bonding or whatever, to work towards these capital projects that we identified in the consent decree, the $30 million worth. Let me answer the ERU question first. I think that, as Bill mentioned, there's the mev and flow about cleaning up some of the ERUs. I think what you're not seeing is the growth that was projected on that. We went through that exercise in 2009 and 2010, just kind of coming from what was becoming a stagnant economy, and that we're still trying to come out of that. So I think that the growth projection that was provided by the consultants at that time was using baseline data that was 2003, 2004, 2005, which was in a whole lot different world than we're living in right now. As far as the bonding is concerned, I appeared before the Kentucky Infrastructure Authority Board last Thursday, And the board unanimously endorsed loaning Lexington $56 million, $4.5 million of it approximately, on stormwater projects. We have to go in front of the Legislative Oversight Committee a week from Thursday, and provide that they don't have any questions and there's no issues there, that we should be getting binding commitment letters from them very soon as far as to blue sheets. So we've got the ability to borrow $4.5 million in the stormwater program at 1.75% interest. So it's coming. Very good. I see a couple other council members have signed up. Vice Mayor Gordon. Thank you, Mr. Chair. I think this one might be for Bill O'Mara. Where is the indirect cost reflected? Is that in transfers, or where is that expense reflected? Vice Mayor, I think it's in the operating expense, but I will get back with you with an answer. Because that was a question that I've had ongoing as far as the charge to water quality for indirect expenses and where they're going within government. And I don't think that's a call that Charlie makes. Doesn't someone else in government decide the indirect cost? Or who decides that? Well, it is part of the budgeting process and is part of the approved budget each year, and then that sets up the actual side of it on the accounting side, isn't it? Yeah, that's accurate. The only thing I prepare is my annual operating or capital budget. I make that submission. That gets rolled into the mayor's budget address. Ultimately, the council obviously sees that, and that's part of the approval process. I don't develop it, so I don't really weigh in on it one way or another. I kind of look that we as a government will determine whether that's appropriate or not. Okay, thank you. So, Mr. O'Mara, could you get those numbers? And I'm also interested in a comparison of indirect costs to water quality since we've had the fee in place, what it has been year to year. Okay. Thank you. I appreciate it. Thank you, Vice Mayor. Councilman Morling. Thank you, Mr. Stennett. Either one of you could answer. Probably Bill is better qualified. I'll be glad to defer. Well, not that Charlie's not qualified, but it's a money question. I was trying to recall when we passed some of these ordinances for the water quality and sanitary service that we had a cost of living increases in the fees, and, of course, the cost of living has been very, very low. Are you concerned that this could be an issue that we'd have to address as a council anytime in the near future to make sure our cash flows are adequate since the cost of living has been very flat? Well, first of all, your recollection is correct. Embedded in the ordinance is an annual review and July 1, a cost of living adjustment to the fee if warranted based on the trailing 12 months. The second question is we're meeting quarterly with the parties that are spending the money to be in compliance with the consent decree, looking at projected cash flows for any rate evaluation. One of the really great wins that Charlie just alluded to has been a wonderful success through the Kentucky Infrastructure Authority And those very, very low interest loans are very beneficial in letting us not go out on the bond market and bond those dollars, but to borrow them at very good interest rates. Do you think we have a chance on an annual basis to make additional loans with them, or is there a cap that you can't get any more than so much? That was brought up during the board meeting as far as the question about concentration, what concentration of different entities make up their loan. If we are approved for this, we would be roughly about 8% of the total indebtedness on the part of Kentucky Infrastructure Authority. That will move us into the top five, but we're well behind Northern Kentucky, which is Sanitation District number one, and I believe Winchester as well. but we will reach a point to where we're too much of the concentration and we'll have to look to other sources. The good thing, though, is that for the near term is that the way that we believe these will be structured is that essentially we're writing checks to pay for the construction and then in turn getting reimbursed from KIA. And so I suspect that you're not going to see that some of the unrestricted fund balance change for a while, which is a good thing, I guess, is that when you look at it from that context, it allows us to get further down the road and refine our processes in a more favorable type of thing. But eventually, yes, we will have to look at other resources. Has our bond council recommended we maintain a certain amount of cash in the account for the purposes of making future bonding? Actually, we have bond and indenture requirements. we have to maintain a fund balance ratio. I think it is close to 2.0. So in other words, whatever our largest bond payment would be in the life of the loan, we have to have twice as much as an ongoing fund balance as a minimum coverage ratio. It might be 1.5, but I think it's 2.0. Thank you. That's good information. If you had something in writing on that, I'd like to take a look at it. Thank you very much. I think our time is running out here. I don't see any other council members. Any other questions? Thank you, Mr. O'Mara. Thank you, Charlie. We appreciate it. Last on our agenda are items referred to committee. Are there any committee members that have updates on any items or wish to have them heard at our next meeting? Well, for the next meeting in April, we have the consolidated green wage responsibilities that will be heard. hopefully the feasibility study on the distillery district and then the drainage maintenance issues as well and last but not least Leadership Lexington Group will present a zero waste program to the committee as well so those four items will be on the April committee agenda if there's anything else that we need to go over on this list any other committee members do I have a motion to adjourn we're adjourned, thank you all Thank you.