# Planning Committee - August 21, 2007 > Auto-transcribed civic record · Committee · August 21, 2007 - **Permalink**: https://meetings.lexingtonky.news/meeting/97 - **Source video**: https://lfucg.granicus.com/player/clip/97?view_id=14&redirect=true - **Date**: 2007-08-21 - **Body**: Committee - **Last revised**: February 1, 2026 - **Length**: 18,354 words > ⚠️ **Auto-generated content.** Audio from the official Granicus video was auto-transcribed by OpenAI Whisper-1. Structured facts were extracted with GPT-4o; the narrative summary was written by Anthropic Claude Sonnet. Speaker labels and verbatim wording may contain errors. See [methodology](https://meetings.lexingtonky.news/about/methodology) or [report a correction](mailto:editor@lexingtonky.news). --- ## Meeting Overview The Urban County Council Planning Committee convened on August 21, 2007, at 1:00 PM with Ms. Gorton presiding as the meeting's presiding officer. The committee addressed one primary agenda item during the session, focusing on the I-64 Louisville Water Pipeline project, which was presented for informational purposes rather than requiring formal action. During the meeting, the committee took two formal votes on various matters that arose during their deliberations. The session also included one public comment, allowing community input on the issues under consideration. The I-64 Louisville Water Pipeline discussion served as the main substantive item on the agenda, providing committee members with important information about this infrastructure project, though no final decisions were required at this time. The meeting represented a focused session where the Planning Committee could review and discuss the water pipeline project while maintaining their standard procedures for public participation and formal voting on procedural matters. ## Attendance The Committee meeting on August 21, 2007 had strong attendance with nine members present and one absent. **Present:** • Gorton • Blues • Gray • Ellinger • James • Beard • Stevens • Stinnett • Crosbie **Absent:** • McChord No members arrived late to the meeting. With nine of ten committee members in attendance, the meeting had sufficient participation to conduct official business. ## Votes and Decisions The Committee took two procedural votes during the August 21, 2007 meeting, both related to scheduling continued discussion of the I-64 Louisville Water Pipeline project. **Motion to Continue I-64 Louisville Water Pipeline Discussion** [timestamp: 02:55] Dr. Stevens made a motion to continue discussion of the I-64 Louisville Water Pipeline to the September 18 meeting. The motion was seconded by CM Blues and passed unanimously by voice vote. **Motion to Schedule September 18th Planning Meeting** [timestamp: 02:58] Dr. Stevens made a second motion to continue the discussion on September 18th at the 1 o'clock planning meeting. This motion also passed by voice vote, though no second was recorded. Both votes were procedural in nature, focusing on scheduling rather than substantive policy decisions. The unanimous support for postponing the I-64 Louisville Water Pipeline discussion suggests the Committee needed additional time to review the matter before making any determinations. No roll call votes were taken, and no members voted against either motion or abstained. ## Public Comment [timestamp: 02:45] Mayor Ed Burtner addressed the committee during the public comment period, focusing on water supply issues and regional cooperation strategies. Mayor Burtner emphasized the critical importance of regionalism in addressing water infrastructure challenges, particularly highlighting the benefits of interconnected water systems across municipal boundaries. He expressed support for the Kentucky American BWSC (Bluegrass Water Supply Commission) strategy, viewing it as a viable approach to regional water management. While advocating for the broader regional approach, Mayor Burtner also acknowledged Winchester's immediate water supply needs, recognizing that the city faces pressing concerns that require attention alongside longer-term regional planning efforts. His comments reflected a balanced perspective that supports collaborative regional solutions while remaining mindful of local municipal priorities and urgent infrastructure requirements. The mayor's remarks underscored the ongoing discussions about water supply management in the region and the need to balance immediate local needs with comprehensive regional planning strategies. ## Contested Items The Committee meeting on August 21, 2007, featured one significant contested item that generated substantial debate among members. **I-64 Louisville Water Pipeline** The primary source of contention during the meeting centered on the proposed I-64 Louisville Water Pipeline project. Committee members engaged in a heated discussion regarding multiple aspects of the initiative, including its overall feasibility and associated costs. The debate focused on two main areas of disagreement: • **Project Viability**: Members expressed differing opinions on whether the water pipeline project was technically and financially feasible • **Corridor Usage**: There was significant disagreement about the appropriateness of utilizing the I-64 corridor for the pipeline infrastructure The discussion was characterized as particularly detailed and intense, with committee members presenting opposing viewpoints on the project's merits. The debate encompassed both technical considerations about the pipeline's implementation and broader policy questions about the use of interstate highway corridors for utility infrastructure. While the extracted data indicates this was a heated discussion with differing opinions among committee members, the specific names of participants, their individual positions, and the ultimate outcome of the debate were not provided in the available meeting materials. The contentious nature of the discussion suggests this was a significant policy decision that required careful consideration of multiple competing interests and technical factors. ## I-64 Louisville Water Pipeline [timestamp: 00:05] The Committee received presentations on the I-64 Louisville Water Pipeline project from multiple water utility representatives during this informational session. Key speakers included Greg Heitzman, Nick Rowe, Linda Bridwell, and Charlie Martin, representing Louisville Water Company, Kentucky American Water Co., and other stakeholders. The presentations focused on three primary aspects of the proposed pipeline project: • **Project feasibility** - Technical and logistical considerations for constructing a water pipeline along the I-64 corridor • **Cost analysis** - Financial projections and funding requirements for the infrastructure project • **Regional impact** - How the pipeline would affect water service and distribution across the region Representatives from Louisville Water Company and Kentucky American Water Co. provided detailed information about the project's scope and potential benefits for regional water infrastructure. The discussions examined various technical and economic factors that would influence the project's viability. This was an informational presentation with no formal action taken by the Committee. The session allowed members to gather information from utility representatives and better understand the complexities involved in the proposed I-64 water pipeline project. The presentations provided a foundation for future deliberations on regional water infrastructure needs and potential collaborative efforts between water utilities in the area. --- ## Decisions - **Motion** — passed (0-0): Continue discussion of I-64 Louisville Water Pipeline to the September 18 meeting - **Motion** — passed (0-0): Continue the discussion on September 18th at the 1 o'clock planning meeting --- ## Full transcript ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] ["The Star-Spangled Banner"] I'd like to go ahead and call the meeting of the planning committee to order. It is August the 21st, and welcome to all of those of you who are here. And we do have a quorum, so we will go ahead with our agenda. And the first item on our agenda is the Louisville pipeline, which the council asked at its July 10th work session to hear from the Louisville Water Company again. And then, if we have time, we'll hear the issue of the Downtown Development Authority Land Bank. Most council members have expressed the opinion that because they feel the water solution and issue is important, that we give plenty of time to those of you who are here for that issue. So we'll just go through our agenda as we can, time-wise. Council members, you have received lots of materials. There is a copy of the 1999 resolution for each council member, and there are some extras in the back of the council chamber. And then I wanted to just thank, we have representatives of the Louisville Water Company, Kentucky American Water, and the Blue Grass Water Supply Commission here, as well as other interested parties. So I want to thank all of you for taking time to be here with us. Various council members have expressed the opinion that the reason we're here is so that we can go ahead and look at the different options that are out there, and perhaps if council members want to weigh in on what their opinion is, that will work also. Council Member Beard, you made the motion to put this into committee. Do you have any comment before we go on to our speakers? Well, actually, at the time, of course, everybody was in somewhat of a state of shock, and I had fingers pointed at me and a few other things. But as I think I've communicated to all parties, I think that we do our due diligence on the numbers and see just exactly what the best financial deal we feel anyway we would want to recommend to the PSC. We understand that we do not make this decision, or at least I understand that. Anyway, we owe that to our rate payers to be able to vet the numbers and vet the capability of it happening. We have been playing around with this whole concept now for, as this resolution points out, for some length of time, and now it's time for us to make our recommendation and get this going one direction or another and get it done quickly. I anticipate if I get the support of my fellow council persons, having a final recommendation crafted by the September meeting of this body. That's all I have, Chair. Thank you very much, Mr. Beard. Then with that, I'd like to call on, I know Mr. Greg Heitzman is here, with you to make your presentation first. You're from the Louisville Water Company. And also, if you could, I know there's been some activity since we saw you July the 10th. If you can also get us up to speed on that. First of all, thank you for inviting us back today to make a presentation Let me introduce myself, my name is Greg Heitzman, I'm president of the Louisville Water Company. I brought with me today our team from Louisville. Vince Gunther, our manager of government affairs is with us. And Jim Smith, our manager of infrastructure planning is with us. And Vince and Jim and I will make a presentation today. And we'll present the information, and then what we'll also do is be available for any questions and dialogue that any of the council members might have for us today. What we have is a PowerPoint presentation. We've got some copies available as well, so we'd like to hand those out. Okay, much like a month ago, on July 10th, this is the same introduction page that we had at that particular point in time. First, it's our understanding of securing a safe and reliable water supply is a very important issue for central Kentucky. That determining the source of this water supply needs to be resolved by the water supply professionals, the community, and elected leaders of central Kentucky. The Louisville Water Company has an unlimited source of supply in the Ohio River, with enough reserve capacity to be able to supply the current and future water supply deficits of central Kentucky. And Louisville Water Company is a low-cost component of a twin river solution for reliability and drought protection for central Kentucky. From a water supply need perspective, our understanding of the water supply need is that there is a need for an additional reliable supply by the year 2010, that the capacity is between 20 and 25 million gallons a day for a planning period taking it out to the year 2030, and that everyone is interested in a low-cost solution for that water supply. What we did for this presentation is we laid this out with information that is very consistent with what we had at the last presentation. We're going to take you through about 10 more slides and then open it up to any questions. With this, I want to introduce Jim Smith, and Jim is going to cover this particular section for us. Thanks, Greg. Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Jim? Mr. Treisman, this is a financial question, and I may or may not be wrong on these numbers. Somewhere in my memory I remember a number of $1.71 per 1,000 gallons. Yes, sir. And that would be the price that Louisville Water Company has estimated based upon a construction cost of $56 million. That would be the price that Louisville Water would offer to Kentucky American for distribution at Fayette County. Is that correct? Yes. Let me see if I can get the page here. I recognize that number has some movement in it perhaps, but is that what you're estimating today is my question. If you take a look, we're going to go to page nine. Okay, right. And this was in the presentation before. Our current wholesale water rate for our wholesale customers outside Jefferson County is $1.71 per 1,000 gallons. We wanted to make it clear today because this was a similar question that was asked a month ago. And our water rates, our board reviews them on an annual basis and makes a decision. The board of Louisville Water Works makes a decision on how they will be adjusted. And we can't project for the next 20 years exactly what that rate will be. And that's the case for all water systems in this country. So am I correct? My question really has to do with within that $1.71, how much of the $56 million of capital cost is included in that number? Or is it included? You're saying that you would continue to be able to sell at that rate and include the $56 million of capital cost? No, sir. Okay. What we're proposing is that we will build, fund the pipeline to Shelby, the Highway 53. The balance, which is represented as $56 million from Shelbyville over to central Kentucky, would be paid for through one of a couple of options. One, it could be funded by grants, low interest loans that could come from state or government agencies, the water providers that benefit from the water supply, or it could also be financed by the Louisville Water Company. So essentially, much like the Pool 3 option, that particular option is being funded by Kentucky American in the Pool 3 proposal. So the $1.71 does not include the cost of financing that portion, nor does it include the cost of construction of that $56 million section. But it does include your processing costs and, at this point, today's numbers. Correct. Include your processing costs. Our production. Your production costs. Essentially, our production and delivery costs. It also includes our investment of $26 million to get over to Highway 53. Okay. Thank you. Does that clarify? Yes. Thank you. Do other council members have questions? If not, at this point, I'd like to ask Council Member Blues to take the chair and then give it back. I have a few questions myself, and he actually has threatened not to give it back, so we'll see. Would you take the chair, please? Thank you, former chair. He is our vice chair, so. Council Member Gordon. Thank you. I just had a few questions. Based on just what you said about the ways of financing the construction, tell me what you know about federal grants for this type of thing. Are they common? Are they rare? How many cities or entities with municipal systems are able to get those? I have more experience at the state grant level because there's been a lot of money put into water and wastewater projects since 2000 with the adoption of Senate Bill 409 by the Kentucky Legislature. And there's been over $600 million that has been invested in water and sewer line improvements throughout the state of Kentucky since 2000. And those grants and low-interest loans come from a wide variety of sources, specifically coal severance money as well as tobacco settlement funds. And that's in a large way have funded a lot of water and wastewater projects that have improved the water supply system throughout the state of Kentucky. And so I think that a project like this, and when I use this term, is very attractive because it's, first of all, it's a regional solution that involves multiple constituents across multiple counties. And that becomes very attractive for elected officials at the state level. I think if we take that up a level and we connect two major cities, Louisville and Lexington, with a pipeline that benefits not just residents of Louisville and Lexington, but also all the communities in between, I think because it then is the two largest cities in Kentucky, that that then becomes attractive at the federal level. And certainly those would be specific line item appropriations at the federal level or earmarks that could benefit Kentucky citizens through the federal process. So there's two levels that you would approach, both the state level as well as the federal level. How do you see that playing out? Are those grants, are they only available to cities? No, not necessarily. Specifically, they could be awarded to city governments, county governments, or political subdivisions thereof, and they could also be awarded to the state of Kentucky. Okay. So a federal or a state grant could be applied for by Louisville Water Company. It could be applied for by Lexington to go toward the same system that you would propose. Is that correct? And if it was up at the federal level, an application could be made by the state of Kentucky in order to be able to be attractive to our federal elected officials. So essentially what you would do is get the elected officials that represent the constituencies of benefit, pull them together, get on a common page with respect to what is a solution that benefits the majority of people in the commonwealth, and then make that pitch to those elected officials that a grant or, again, a low interest loan or the combination of both would make sense for the public drinking water supply for central Kentucky. Are those grants usually matching grants or are they straight out grants? In some cases. Or do they vary? In many cases, they do require some match. And that match could come, again, through a low interest loan or a match for a federal grant could be made by the state. So that's why interchangeably we generally use both federal and state grants. Okay. You mentioned the regional perspective. And if we could go back to your map, please. I know that when we hear from Kentucky American, they have provided us also with a map. Your map, I guess I want to clarify for myself exactly what we're looking at in terms of a plan. How would you see this map changing if right now it would include Lexington, Louisville, and points in between? Yes. But we know we have more regional partners than that. We would like to have more included, which the Blue Grass Water Supply Commission has had. Can you talk about that a little bit? I think one of the attractive features of an Interstate 64 pipeline is certainly you bring into the fold a broader region. You bring in the Shelby County providers. And we've met on a number of occasions with the four water providers in Shelby County, and they also need an increment of new supply for both growth as well as drought protection as well as an emergency. And what we have found is that our plan, and we mentioned this last time, is we will be building a water line beginning in 2008 out Interstate 64 to the Jefferson County line, and the minimum size of that line will be 24 inch. And so we need that regardless of the water supply needs in central Kentucky. The question for us is what size should we build that line? So then what we initiated about four months ago is discussions with our Shelby County water providers of their water need, and they are interested in extending that line along Interstate 64 from Jefferson County into Shelby County. And then the question is what size would we make that go from 24 to 30, 24 to 36, or larger based upon the water need? And much like what Blue Grass and Kentucky American have done, we take a look at the water supply need over a 20-year period. So we have done that with the Shelby County water suppliers. Once we began to meet with the Shelby County water suppliers, there was interest from both Frankfurt as well as Georgetown. So that brings in two additional players that are shown on the map here. Frankfurt is in the center of the map at the Kentucky River, and then Georgetown is in Scott County to the northeast. So we were approached by both Frankfurt as well as Georgetown to make presentations similar to what you have done, and so then we have run some preliminary scenarios of the viability to increase the size of the line and the length in order to be able to accommodate the water supply for central Kentucky. I don't have a map that would expand, but if you expand the area, you're going to show all of Kentucky American's water system, and then you're going to bring in the communities that surround Lexington, and that would include cities such as Winchester, Richmond, Berea, Nicholasville, etc. And ultimately, what would be of best interest for those in Kentucky is to be able to connect the water systems. It's a lofty goal, but if all the water systems in Kentucky were supplied by one entity, we would have a network of water pipelines, much like you see in Lexington on the map on the far right, or in Jefferson County on the far left, and they would be all interconnected. We've been in the business for 150 years. At one time, we only served the city limits of Louisville, which was very small, and there were a number of smaller systems that provided water in and throughout Jefferson County. And over time, we've been able to demonstrate that connecting those systems and pulling them into one water system makes sense from an economic perspective. And so what we're doing is using the same concept to be able to link water systems throughout Kentucky. That's important from, again, what I mentioned earlier, an emergency perspective, from a drought perspective, as well as from a peak demand scenario. We talked last time about whether it would be a 9-11 type event or whether it would be an event of a natural disaster, an earthquake or some other natural disaster, a power outage in a storm, et cetera. So what we're promoting is connecting different communities with these pipelines. Smaller water systems that would be between Louisville and Lexington would continue to provide retail water service at the local level, and this would be a wholesale transmission main that would provide water to those local providers that would then in turn resell it to their customers. So the local water systems would continue to be in business in the model that we're promoting. So the water would come wholesale and, I mean, I'm just speculating here. I'm saying that mainly to our Kentucky American folks. The water would be wholesale and then Kentucky American could resell it to its customers if that's how that connection works. Yes. And in this particular case, any water provider along the route, Shelbyville, Shelby County providers, Frankfurt, Georgetown, other communities along this pipeline route would have the ability to connect into this regional transmission grid to be able to get service off that pipeline at that $1.71, and then they would resell it. So it would not be water that would be exclusive to one particular entity. It would be in order to be able to plug in every water provider throughout that particular course and path, there would be the ability for any of those water providers that are sanctioned in the state of Kentucky to provide local water service would have the ability to get a master meter off that pipeline, get it at $1.71, and then resell it to their local customers. Okay. Now, you mentioned construction along I-64. Yes. On the highway. What's the status of that? And you mentioned, I've forgotten exactly what your words were, but the linking up with that process. Where is that process and where would you see yourselves entering into it? What we've done is some homework with the Transportation Cabinet in contacting them to find out what is their status with the widening. And what we know today is that the Transportation Cabinet is widening the interstate. And when I say widening, they're not changing the right-of-way width. They're widening the road from two lanes in each direction to three lanes in each direction. Okay. And they're building it to the center as opposed to widening it. Essentially, they're widening it to the center. And so there's two major points here. That construction is already underway in the Waddy area just west of Frankfurt. We came through that construction this morning on the way, and there's a lot of earth-moving equipment, and they're moving very quickly. And so that is between Shelbyville and Frankfurt, and that contract has already been let and underway. What we found out from talking with District 5 in Louisville about the Jefferson County and Shelby County portion is the portion of Interstate 64 from the Snyder Freeway, which is the outer interstate loop, east to Highway 53, which is essentially that green section. It coincides. That is authorized to proceed, and the section will be bid this September for the section between the Snyder Freeway and the Jefferson County line. And then from the Jefferson County line to Highway 53, again within that green section on the map, that will be bid in 2008. So what we would need to do is we would have to first convince that it's in the best interest of the citizens of the Commonwealth to be able to use a portion of that right-of-way to be able to put this pipeline in that corridor. And where it's feasible and possible, then it will be able to save, have less encumbrance on properties, as well as it will save money. The second thing is that construction, as I've mentioned before, contractors that are doing road work can also lay pipelines because they'll do drainage pipelines, water pipelines, et cetera. So there's an opportunity to be able to get an economy associated with having the road contractors put in the pipeline. That is our intention of accelerating this project in parallel through Jefferson County is to be able to get the water line constructed in a very cost-effective manner by taking advantage of the parallel construction with the road. But clearly we want to make sure everyone understands here today is that that would need permission from the State Highway Department to go inside that right-of-way. That has been done before in the state of Kentucky and elsewhere across the United States, but it's a case-by-case review. And the State Highway Department, with the Federal Highway Administration's blessing, would need to approve it. Would your company be required to do any kind of environmental impact study for this sort of plan? We would, in certain areas along the route, we would. So when there are environmentally sensitive areas, for example, crossing the Kentucky River or other creeks along the way, or if there's any areas that are what we would call environmentally sensitive, we would have to conduct a study. Ultimately, it may be for the majority of the route, but that would have to be done just like any other major public works project that would impact an environmentally sensitive area. Who makes that determination? Ultimately, it would be a combination of both federal officials, for example, the Army Corps of Engineers, as well as the state of Kentucky. Okay. And then I have one more question. In your information, you stated that you thought this plan would, I'm trying to find the page here, would be adequate until the year 2030. Yes. Tell me a little bit about that. Is that simply a normal projection out, or do you foresee that in 2030 something's going to happen that will change this? It's common practice within the engineering community and doing water supply plans to look out over a 20-year period. And assumptions have been made that there's a desire to have water availability available by 2010. Twenty years out, 2010 takes you to 2030. So that's a reasonable planning period that Blue Grass Water Supply Commission, Kentucky American, and Louisville Water has used. We have to recognize that there would be projections past 2030, and then you would typically do another 20 years going to 2050. So what we did in order to be on a common base, we looked out and used the same information that the Blue Grass Water Supply Commission has used in looking at that 20-year period. Okay. I did think of one more question. You mentioned something you mentioned about Georgetown and Frankfurt had asked to hear your proposal. Was that simply a request to hear it so they could compare alternatives, or can you tell us any more about that? I can't speak for them. Right. I understand that. And they may have some representatives here today that may want to speak to that effect. We were invited by both the Frankfurt Plant Board to make a presentation with and we can provide copies of those, their public record, with essentially much the same information. What we did for Frankfurt is provide a proposal of providing water through Shelby County and into Frankfurt, and that presentation did not include water supply to Lexington in the presentation that we made, although it's expandable to that. Last evening we were asked to make a presentation to the Georgetown City Council and we made a similar presentation where water would come down Interstate 64, in that case a 24-inch pipeline would go to Frankfurt, who in turn could then provide water supply to Georgetown. So part of this concept is what we refer to the industry as wheeling water. The reason we support it is it takes advantage of the infrastructure that's already in the ground, that's already built, that's already been paid for. So what happens is we maximize the existing infrastructure that already is in place, and as a good example here, the production capacity is already in place in Jefferson County, so we don't have to build another treatment plant. And there are portions of pipelines that are already in place in Jefferson County and in Franklin County, so essentially to a large degree we're connecting the dots and connecting them as most effectively, cost effectively, and timely as we can in order to be able to get an increment of supply into central Kentucky. And then from there it can then grow and you can parallel the pipelines for redundancy and reliability. When do you anticipate hearing back from Georgetown and Frankfurt? Last evening the Georgetown City Council, they have a Georgetown Water and Sewer Board or authority, and they asked us to be prepared to be able to make a presentation to them, and they felt that they are the local water supply experts, the water supplier, and so that will be up to the water board in Georgetown to determine if they would like for us to come back and make a presentation. Okay. Any word on Frankfurt? No. Since we last met with Frankfurt, I think that they're looking, again, I can't speak for them, but I'm sure they're looking at their different options that would be available for them. So there's no new information that I'm aware of to report on Frankfurt. Okay. Thank you very much. That finishes my questions, Vice Chair. Thank you for the commotion. I return the committee to your care. Thank you. Council Member Stennett. Thank you, Council Member. I just have two final questions to kind of sure up your presentation back on July 10th today. What is your time frame for getting a firm cost for this proposal? I mean, when will you know back from the state? When will you know about the Kentucky River solution, if they're going over the bridge or under? We've got two issues here. One is what would be our time frame of our updated cost evaluation and the financial, and we'll have that in September. We're two weeks away from September. We're two to four weeks away from having R.W. Beck complete their analysis. What we would then do is we would, from there, we would then begin that process of specifically meeting with the state officials to see if that's a viable alternative on addressing that issue within the right-of-way or hanging on the bridge. We can't speak for the state, so I don't know what the timing would be on that, and a lot of it really depends on the interest from the central Kentucky community because we could spend a lot of energy and time on pursuing an alternative that may not be the desire of central Kentucky. So really the timing for that component is going to be determined by the state officials related to the right-of-way issue and related to the bridge issue. So if everything went according to as you all proposed and planned, the earliest this pipeline could be functional is sometime in latter 2010, is that right? That's correct. That's at the very earliest? That's at the very earliest. I don't see a pipeline of this size and length being able to be completed prior to 2010. And what is your contingency on that estimate, 56 million? I mean, are you within a $20 million ballpark either way? I think what we're going to see is cost estimates that come back again in that, I think on the low end it's going to be 10 percent, on the high end it's going to be on the order of 20, 25 percent, based upon those material cost pressures that we see. And then once that's available we'll make that. So I'm going to let the outside consultant be able to defend those and we'll make those available. Any early cost estimates ongoing under the river or over it? No. Not at this time. Okay. Thank you, Chair. Do other council members have questions? Council members may have questions as the discussion goes on. So if you'll not vacate the premises quite yet, I appreciate it. Thank you for your presentation. Thank you again for allowing us to speak today. Thank you very much. Now, Charlie Martin, who is our very own urban county government representative to the Blue Grass Water Supply Commission, we will hear from Charlie at this time. Welcome. Thank you. You took my introduction already, I guess. Those of you who all know me, I'm Charlie Martin. I'm normally the director of water and air quality, but I've been the representative for Fayette County with the Blue Grass Water Supply Commission since 2004. Given our time and all that, I know that we want to get on to hearing from Kentucky Americans, so I'm going to be brief in my comments and just give you a little bit of a history and perspective about Blue Grass Water Supply Commission's role in this entire matter. There are many members of the commission that are here as well and some associates, and I'll just name them because they're here available to answer whatever questions may come up as well. Damon Talley, who is our legal counsel. Brian Loven, who is with O'Brien and Gear Engineers. They have been our technical consultant from the entire time that I've been involved with the commission. And also Tom Calkins, who's the utility services director with the city of Nicholsville, but he's also the chair of the commission. Once I conclude my comments that Kentucky American, I think Mr. Rowe is going to come up and present their plan and their costs. And then I'd like to conclude that with some other of our commission members, I guess elected leadership that would like to have an opportunity to address the planning committee as well, specifically Winchester Mayor Ed Bertner and also Donna Powell, who's currently the special assistant for the judge executive for Garrett County and also the former mayor pro temp for Lancaster. That being said, I'll jump right into the slides that we have that start on page 15 of your packet. As you can see, this is a proposed partnership between Blue Grass Water Supply Commission and Kentucky American Water Company. And I'll emphasize the partnership aspect of it. The commission believes strongly enough in that this is the right solution for the region that they've been willing to invest over $171,000 in concurrent design of the Pool 3 water treatment plant. So we feel like that's a significant commitment on our part in what we believe is the right solution. You see there the members of the commission, and you see LFCCG there that's been mentioned earlier. I've been involved with it since 2004. The irony of this was that my history is with the Ohio Environmental Protection Agency and the drinking water program, so I've been involved in a lot of regional water planning activities over the course of my career. And I can't say I've ever been involved with one as involved as this one. We've turned it inside out and backwards and forwards, upside down, and looked at it quite extensively. And one of the things I want the committee to appreciate is that this has not been a hasty decision on the part of the commission as far as arriving at this conclusion. The brief history there, I won't read that to you, but as you can see that this was formed in 2000 as a consortium and then evolved in 2004 as a commission under a Kentucky revised statute. One comment to that is that it's ironic that we're here talking about this on a rainy day, but I congratulate my colleagues on the commission and consortium that they have done a tremendous job of keeping this issue on the forefront for many years since their forum, whether it be wet weather or dry weather, that they've made a really, really strong commitment to keep this on the front burner. And I respect and admire them a great deal for that. Some of the actions of the consortium is that they established dialogue with the regulatory agencies and facilitated a facility study. And really what the consortium did before they became the commission, they did the heavy lifting as far as this feasibility study. The feasibility study, a copy of that report was provided to council members who were on council before 2006. And as I was thinking about this in the back room, I realized that I haven't provided it to the people who are newly elected or have joined the council this year, and I will provide an electronic copy of that. It's very detailed, very long, but for all things fair, I need to make sure that everybody has a copy of that because we provided that copy in 2005, the last time that the commission appeared before the full council over in the Phoenix building. The state agency input that was involved in this, you see that it's a plethora of different groups as far as state and local leadership involved in this. The feasibility study actually involved more than the 10 who are members now. It was 18 governmental agencies that were involved in this, and the feasibility was funded by the consortium members themselves, the Kentucky Infrastructure Authority, and a congressional grant. And the final report for that was completed in 2004. Really some core things that were looked at. This is a complex issue, as I said before. I've never been involved in something quite this complex. But there were five core comprehensive evaluation criteria that were looked at, and obviously each one of those is very important to be able to make this kind of decision. They took those core alternatives or those core criteria and conducted a review of previous studies, eliminated some of the things that didn't seem plausible as far as the amount of water that was available to them, and finally came down to 40 alternatives that could be looked at more extensively, both in a near-term and a long-term aspect. More evaluation, more consideration of this thing, and it finally boiled down to the 16 near-term alternatives and then a matrix with a weighted criteria of those core issues, water quality, water supply, flexibility, cost, those things, to finally develop a matrix at which there was a decision-making process that went about. And that's the top three that came out of that entire decision-making process. And in reviewing this or preparing this, it was ironic, is that two of the top three are the ones that we're still talking about today. Even when they made the top three and came up with their recommendation in 2004, the commission didn't rest its laurels on that entirely. In 2006, we stepped back again and evaluated a mixture of different alternatives that involved a hybrid type of solutions that included maybe Greater Fleming and also Louisville Water Company and all that. The commission has entertained four different proposals from the Louisville Water Company over the course of time. And at the end of the day, we continue to come back to the same recommendation, which is the Pool 3 alternative, a Pool 3 treatment plant with a 42-inch transmission main from Pool 3 to Fayette County. I think that it's been important to the commission members in the past that we felt like this was consistent with the intent of the resolution at which Council Member Gorton mentioned early on, is that there was a strong message sent from the council in 1999 that the Kentucky River was the preferred solution. And so when this recommendation was made, the commission felt like they were on firm ground. Also, in some of the different proposals that were being considered from other water providers, there was always the issue about reserved capacity versus available capacity. And just speaking to myself personally, I felt it very important, the emphasis on reserved capacity, any day, every day, as opposed to available capacity when I've got it. That's kind of how I perceive those things, is that once I buy into something, I want to make sure that it's every day, any day. That, to me, I think was very important, and I think it was important to many of the commission members as well. Pointing out, and as you can read this, is that all these decisions weren't made in a vacuum. There was an extensive public participation aspect of everything that the Water Supply Commission has done. We continue to advertise and have public meetings, and we've had several folks that have attended. Vice Mayor Gray, you've been very active here, and we appreciate your participation in that. The plan, as I said before, is that we're proposing a partnership with Kentucky American Water Company to construct a 25 million gallon a day water treatment plant on Pool 3 of the Kentucky River and a 42-inch transmission main to Fayette County. The ownership, equity ownership, percentages are equivalent to the investment that we've made in the design at this point in time. At this point in time, I'd like to turn it over to Nick Rowe and allow him to introduce the plan that Kentucky American is putting forth. Thank you, Charlie. Thanks, Charlie. Ms. Gordon and this planning committee, thank you for giving us an opportunity to speak. I just want to reiterate Charlie's comments about the work of the BWSC. I really have admired this group. It's really tough. In this community, we talk a lot about regionalization, but sometimes don't do a lot about it other than talk, and this group has really worked hard with each other. It hadn't always been easy. It's been challenging for us. It's been challenging for them, but those folks who have stayed the course, I really admire them for that. The Tom Calkins, who's chaired this group, and Don Hassel, who's worked very closely with them, all the members, and Mayor Bertner for really stepping up and really getting involved as an elected official for the city of Winchester, along with Vernon Azevedo. I really admire the hard work of everybody that's been involved in that. That's not an easy task, and we all know that in central Kentucky. I also appreciate the concerns by this committee here to get involved and really on a fact-finding mission. I think this is a complex subject, and there's no way that we could sit here today and go through all the numbers. Of course, that process will take place in front of the Public Service Commission with their engineers and their accountants. It will be a very, very, very transparent, very detailed review. It will be for days, a lot of cross-examination on the witness stands of our engineers from Louisville Water, from Kentucky American, from everyone. So all these types of questions that you may or may not have will come out through that process. With me today are a couple of folks from our business. Of course, I think most of you know Linda Britwell, who's our managing engineer, and I'll introduce her in a few moments. She'll get into the details. A.W. Turner, who you may not know. A.W. replaced Herb Miller. If you get a chance to meet him, please do. Herb left us and went to Columbia Gas. He's our legal counsel. David Whitehouse, our director of government affairs. Valeria Swope, who is our communications manager. And Michael Galavati, who is our senior operations engineer on this project. And we've got various consultants who've been working with us because we have a project that's actually been designed and actually from the Public Service Commission. And no, all of us are not going to speak because I think we'd be here all night if we did that. But, you know, Central Kentucky has a critical need. It's been studied and studied for the last 20 years. And, you know, we're a company, as you know, that does a lot of polling. You know, we just had a recent survey done, and 86% of the customers say, hey, get on with it, please, do something. And I think that's why our Public Service Commission is as well. We believe we put forth a regional joint project that is most cost effective, most timely, and involves a good regional cooperation. And, again, one thing I want to point out to this planning committee and to our council members is that Kentucky American is also under 1997 pending order with the Public Service Commission to resolve this water supply situation. So I'm sure, and I only mention them several times because I don't want to try our case in front of this group, only because I want to make sure they recognize the Public Service Commission. We understand they are regulatory oversight. And they tend to remind us that you still have an outstanding 1997 order. So we want to make sure we comply with that. Purpose of our presentation, first to provide an update on Kentucky American. We do have some new council members, and some of our council members may or may not know about our facilities. I know Dr. Stevens and Mr. Beard have been to our facility. As Julian said, actually on our Customer Service Advisory Council here for last year. And, Julian, thank you for doing that. But also present what we feel is the best regional water supply solution. And, of course, answer any questions that this committee may have. Real quick, again, because we've got some new council members, we serve about 115,000 customers in 10 counties. As you go up interstate, we push water north as far as Sadieville here from Lexington. And we go up to the city of Owenton and Elk Lake. We bought two or three of those municipalities several years ago. So we do go up I-75 to Owen County, Grant County. We have a century of providing high-quality water and reliable service. We're a good employer. We're a respected corporate citizen. And just as important to this group, I'm sure, we're a significant taxpayer. We employ about 150 water professionals locally here, have three water treatment plants providing about 70 million gallons, two wastewater plants, over 1,800 miles of water mains, and 27, almost 30 storage tanks. But our real strength really does come from our partnership with our parent company, American Water. You know, we are the largest provider of water and wastewater services in North America. We serve 17 million people. I say 29 states. I was on a call this morning. I understand that number is 32 states, also Puerto Rico and Canada. But the last bullet point I think is something I really want to point out. We own and operate almost 800 water treatment plants around the United States, 56 wastewater plants. Somewhere today in the U.S., we're building a new treatment plant, a new wastewater plant, or refurbishing one of our facilities. That's what we do. We do this every single day. So water supply, while new to this community, is something that we do all over the country, from California to New York to Canada, south to Texas to Florida, wherever the case may be. Our service area, I mentioned the counties. You can see them there, the 10 counties. Six of those are part of the Blue Grass Water Supply Commission. Again, I can't thank the BWSC enough for their spirit of cooperation. I hope we've been a good partner with them along the way through this process, and we want to continue to get this project done. But before I turn it to Linda to get into some of the details of the cost, which I'm sure everyone wants to hear, and, again, we won't be able to get through all the costs here and the details because that will come out in front of the commission, but we'll do a high-level overview to give you our first glance of information that's been provided to us. But we do have some broad regional support. The BWSC itself, the Attorney General, who represents every consumer in the state, of course, will be a major, major player in front of the Public Service Commission. His office will look at demand projections, look at the cost estimates to assure that we at Kentucky American, along with our joint partners, have picked the best project for our customers, all 115,000. Whether or not we may think a project is what we would like to do, they'll make sure it's a very transparent process. The Blue Grass ad and Lenny Stoltz and his group has been very involved in working with the elected leadership. I think Lenny would agree that we really would like to see a regional project in Lexington. Again, we've talked about it not just on the water issue, on a lot of different fronts in Lexington, but we have yet to really pull off a true regional partnership. The Kentucky River Authority and Steve Reeder and his group, again, very supportive of this effort. I know they have really worked hard on refurbishing the dams on the Kentucky River. You know, work is going on at Dam Number Nine right now, which protects our water supply. Again, we really want to work closely with Steve Reeder and his group because, again, this project does provide long-term funding for the Kentucky River and our dams. And, of course, the Oren County Fiscal Court, which is where the plant facility will be located, they passed a resolution along with multiple chambers of commerce. So we do have built some broad regional support. We hope that this planning committee recognizes that and actually hope that this group would come to the same conclusion that this group has. And we're really looking for support from this group as well. Now I'll turn it over to Linda. I think most of you know Linda has been involved in, Bridwell has been involved in its water supply project for 17 years. And you're talking about somebody who has stayed steady in this process. I know it's been very, very frustrating for her, but I would venture to guess there's probably nobody in central Kentucky who knows more about the regional water solution than Linda does, not just from Kentucky Americans' viewpoint, but also the needs of all the regional players because she's lived it for 17 years in some form or fashion. We kid her at the company that we think she hasn't solved this issue because of job security. And it has been a long time for her, and I'm sure she would like to get this issue resolved and behind her. But also I want to recognize Bill Greer, who's here. I hope Bill gets a chance to speak because Bill is probably another gentleman I would say knows the Kentucky River better than anybody in the state. I can tell you he knows about every lock, every dam, the valve operating plan. And Bill can tell you about the viability of Pool 3, which is where this new plant will go. He can talk about Pool 9, where we are today. He can talk about each one of the regional players and where they sit in their intake and the water available. And I think we really have, between Linda and Bill, two people that really know this situation probably better than most of us and all of us who have studied it and reviewed it. And I would just again encourage this planning committee to review this in great detail. And we'll be glad to take questions. But I'll turn it to Linda to get into the presentation. Thank you very much, Mr. Rowe. And welcome, Ms. Bridwell. I think probably we'll save maybe 15 minutes at the end, if we can, for questions from council members. So thank you. Okay. Thank you. Yes, Nick has kidded me for a long time. I don't know what I'm going to do when we actually get this solved, and I have to do something else as a career. No, actually, the need for additional water supply was identified over 20 years ago, and it has been reinforced through a number of droughts we've had over the years. 1988, I think, was the first drought, and we all saw it as a crisis. We went into restrictions in this community for 12 days. And I think when we turned around in 1999 and there were restrictions for four months, kind of all stepped back and said, oh, wow, you know, 12 days wasn't really anything when we saw what we were facing. While the community, let me talk a little bit about while we've been researching and debating this issue some of the things Kentucky American has done. We have implemented some short-term improvements at our treatment plants, some ways to squeeze a little bit more water out of those treatment plants to make sure our customers' demands are being met while this issue is being resolved. We also implemented a long-term conservation program in 1992. It's been extremely successful. Over 93% of our customers say that they practice some form of conservation, and almost 75% of them say that they are aware of the information that Kentucky American has provided and that it has been helpful. So we feel like that has been a good sign that we are seeing a trend downward in per-customer usage on an average basis. One of the things I also wanted to talk a little bit about was if you recall in 1999, Kentucky American was working with the Louisville Water Company on a proposed solution. We had an agreement actually negotiated with them. We were under design. And for those of the council folks that were here and may recall, Kentucky American was asked to stop work on that and work in a cooperative effort with the council to review the situation. And our interpretation of what the council asked us at that time was to first look for a regional solution. This was Kentucky American's solution, but we want you to work on a regional basis, and they identified a preference for a Kentucky River solution. With those two items, Kentucky American, working with the Blue Grass Water Supply Commission, stepped back, said let's look at all the alternatives again and find out if there is a way to address those two items and still have the best, cheapest solution for Central Kentucky. And we're pretty excited that that's what we've come up with. That's what we're talking about today. And those are the things we want to make sure you all have the information and understand that that's where we've gotten to. The Kentucky River solution, since 1999, some of the things that have happened, first of all, the Division of Water has changed how they address withdrawals on the Kentucky River. They've now started giving you credit, essentially, back for the wastewater flows that come back into all the different tributaries. That wasn't happening in 1999, so some of the restrictions on the permits were extremely strict, and that was one of the reasons we had looked a different direction. Also, the work on the dams. I know a lot of people have said that the progress has been very slow, and those of us that live in this, you know, instant gratification society, it is difficult to see that it's, you know, when it's taking five, ten years. But the work on the dams is going forward. They've put valves in the dams to allow operations. They're working on a stabilization of nine. They have the study being done on ten and the study being done on three. So certainly those are some of the things that have changed in the last eight years. I also want to talk a little bit about this partnership because it is just a model partnership for the state of Kentucky. This is not all of us shutting down and joining in a regional. We're all maintaining our autonomy, but it's a public-private partnership that's looking for the next phase, the next supplement on a regional basis. We're going to be equity partners on this. You know, we've talked about the Water Supply Commission owning everything, Kentucky American owning everything, and what we've come out at this point is it's an equity partnership moving forward. For more than eight years, we've been working together, and as I think you've heard today, it hasn't always been easy. There have been days, I think, that all of us walked away from the table and wondered if we'd ever come back together again. But we are here. We've got the right solution at the right time. I think it was interesting, Councilmember Gordon or Chairman Gordon, that you brought up about the federal grants because that's one of the areas particularly that we're working jointly on. As you all know, the D.C. fly-in at the Chamber recently went to Washington, D.C., and talked to the congressional delegation. Water supply in central Kentucky was the number one issue they took, and I think that is a big credit for the Bluegrass Water Supply Commission and their efforts to keep this problem on the forefront. Additionally, both the chairman of the Bluegrass Water Supply Commission and I were fortunate to go because we were the ones there talking about the availability of federal funds for the Bluegrass Water Supply Commission and this solution. Our plan right now is for central Kentucky to have a water supply in place as soon as possible, and right now that's what we're working for. Let me talk a little bit about the project itself. We have been working for now 18 months on getting the project to this point. We placed the application in front of the Public Service Commission in March of this year. I want to emphasize that our problem is now. This is not a future problem. The identification of 2010 of having it online is not because we need it in 2010. We need the water supply now. But 2010 was the soonest that we felt like we could get anything online at this point. What we have proposed is a 20 million gallon a day plant. It's expandable in 5 million gallon a day increments to 30 million gallons a day. We are currently negotiating with the Bluegrass Water Supply Commission on whether they want 5 or 10. It looks at this point that we're going to be 5. Our project is actually out to bid right now. We went out to bid in August. The bids will be back October 2nd. We have a bid for a 20 million gallon a day treatment plant with an option to expand it to 25 million gallons a day. We're pretty excited that this is the furthest we've ever gotten a project to solve this problem, and we are anticipating moving forward very quickly. In addition to the treatment plant that will be built on the Owen County-Franklin County line, and it literally straddles the line, the intake is on the Franklin County side, the treatment plant is on the Owen County side, it's a 30-mile transmission line through Franklin, Scott Counties, and into Fayette County at Iron Works in Newtown just east of the horse park. The transmission line is a 42-inch, so they will accommodate. By going to a 42-inch, we only had to build one booster station, and it would accommodate the expansion to a 30 million gallon a day facility. Again, let me emphasize, the project is designed. All of the permits are applied for, and about 90% of them are in hand, or we have been told that we will have them by the end of the month. The project is out for bid. We would actually, if we had Public Service Commission approval, we would be able to start work in October. Obviously, the hearing for the Public Service Commission is not until October, so we won't be starting work. But I just want to emphasize where we are in this project. We, and by we, I mean Kentucky American and the Bluegrass Water Supply Commission, have looked at every feasible option. Those of you who have been around the issue for a while know that every option has been looked at, all sorts of reservoirs, storing water. We had some, you know, can we store it in an abandoned quarry? Can we store it in another facility? There have been anywhere from the count is 50 to 75 different options that have been looked at. Then we went back again. We evaluated them all again. This hasn't been a one-time solution, let's look at it, let's go forward. The estimated cost right now is $160 to $170 million. That's the estimate that we have in front of the Public Service Commission, and I've got a little more detail about that a little later on. We have a detailed plan. I guess what is so critical that you need to keep in mind is that you have to look at more than just the construction costs. What are the construction costs and what are the operating costs? Because when you look at both of those combined, I think you'll understand why the Blue Grass Water Supply Commission and Kentucky American and the Attorney General's Office and the Kentucky River Authority have all said that this is the best solution for central Kentucky. So with that, let's jump right in. Okay, our proposal is a 25 million gallon a day treatment plant, 30 miles of 42-inch pipe, and this is, I'm putting this up here because this is what the cost slide is identifying. Again, we would start construction right now. Our bids are back October 2nd. We have a 90-day bid hold period. So assuming that we get Public Service Commission approval by the end of the year, we would break ground in January of 2008. The project would be complete in April 2010. We would actually be online with Water Service in early 2010 with working out the kinks on the startup through the spring of 2010. And yes, it is just a coincidence that that is happening before the World Equestrian Games, but I think everyone here understands while that is not driving this project, none of us want to have hundreds of thousands of tourists here and have a water supply issue going on at the same time. Just to look for a minute at the Louisville Water Company proposal and what they've put in front of you July 10th and again today, 42 miles of 36-inch pipeline from Kentucky 53 from Shelby County into Fayette County. One of the big questions is they've talked about using the I-64 right away. And let me tell you that Kentucky American in 1999 when we were working on that project, as you may recall, we had a route going through Woodford County kind of cross-country. It was paralleling the gas line. In late 1998, we actually changed that route to parallel the I-64 corridor. Came up with the exact same idea that Louisville is talking about right now. It's the same thing. Let's use the I-64 right away corridor. We talked to the Transportation Cabinet twice. Twice got told no, have it in writing, saying thank you, but we don't see that we're going to allow this. It's just not possible. In the last couple months, we've actually talked again to the Transportation Cabinet because we're working very closely with them on getting permits on the roads that we're working with the design right now. We've talked to three different officials that have the responsibility for permits, including the state highway engineer. They have all said we don't see anything to change our position from 1999 right now on using the I-64 corridor for a high pressure or a transmission line, a large transmission line of water. But, again, those are conversations, and certainly if the Louisville Water Company has some access to some additional information, that would be helpful. Again, we talked about using the bridge when we talked to them. We said, okay, well, we'll stay outside the I-64 corridor all the way through 1999. We talked about using the parallel corridor. Continued to still get opposition to the project itself. We talked to the highway department about utilizing the bridge. Well, can we at least save some money and talk about the bridge at the Kentucky River? When we talked about the weight and the load, they were very quick to say absolutely not. The bridge is not designed to handle that kind of load. Now, again, could there be some adjustments made? Possibly. But our conversations, I want to make sure you all are aware of this. This isn't something that we haven't thought about in the last 20 years. The two to three year completion time, again, that's what they have indicated to you. Now, keep in mind what they're talking to you about is a concept, a proposal out there. Kentucky American has been working for 18 months and has at this time a design, a project out for bid, and permits. To stop at this point and start work on a concept or an alternative proposal is going to set you back at least 18 months to start over again. At this point, there's no design, there's no permits, there's no approvals. For Kentucky American to be involved, it would still require the Public Service Commission approval, which, again, keep in mind, we filed our application in March of 2007. We are currently, we will have a hearing scheduled October. So you've got a seven or eight month process after you get the project designed and all your permits appropriate for with the Public Service Commission. So where does that bring us? And I think this is probably one of the slides that you want to, that you may have a lot of questions about. Because this is certainly the questions I've been getting the last few weeks. The capital costs. Let me break down for you. We've got the capital costs of the treatment plant. And, again, right now, all of the capital costs on this page are cost estimates. Some of them are Kentucky American's cost estimates, some of them are Louisville Water Company's. The difference is, is that in a little over a month's time, that first column, the capital costs will actually be bid contractor numbers. But, again, the capital costs, the treatment plant is $68.9 million, the booster and tank facility that would need to be built about halfway, six and a half. What we have estimated, without having the details of what Louisville Water Company has proposed, assuming I've moved that over, that a booster and tank would need to be built along the project that they've proposed over in the far right column. Let me come down one more line, the pipeline. Kentucky American has a $61 or a $390 per foot cost estimate right now. That is our engineer's cost estimate. That's the amount that we have put over as a cost estimate in front of the Public Service Commission. I sure hope that number is too high. I really hope that our cost estimate is $50 too high per foot. But, right now, we have to have a realistic number for the Public Service Commission, and I'm not going to be disingenuous and bring you a cost estimate that is not the same thing that I've presented to the Public Service Commission. In comparison, in the second column, the $56 million that Louisville Water Company has estimated is an equivalent of $252 a foot. Again, without having the details, I simply took the footage of pipe and divided it into that $56 million. There may be some other facilities in there that are included. And, again, they're talking about a 36-inch pipe. We're talking a 42-inch pipe. But the cost of laying pipe, we all use the same contractors. We all use the same pipe suppliers. I mean, nobody gets a big difference in the cost of installing pipe. So, I guess the third column here, and when I've done the comparisons on the capital, is just to take that same footage of pipe and use Kentucky American's cost estimate as if it was a 42-inch main. So, the subtotal, again, on the capital costs, now, we've said all along, Kentucky American building a treatment plant and a pipeline is not, from a capital standpoint, the cheapest cost. The subtotal is $137 million compared to $56 compared to the $86. We believe there are facilities within Fayette County that will need to be built as part of the project that Louisville Water Company has proposed. Coming down from that, the engineering costs, the interest and contingencies that Kentucky American has estimated, I simply took the same percentage based on the capital costs going across. So, if you're comparing total capital expenditures of the interest, contingencies, engineering, permitting, legal, everything that we already, and keep in mind that Kentucky American has actually paid a lot of those costs already out. So, that $32 million, some of that has already been spent, about $5 million has already been spent. The total capital expenditures, again, in comparison, sure, $169 million compared to either $75, or even using our cost estimates for their project, $123 million. The other way you have to keep in mind is the next row down, the next to the bottom row, the operating expenses. Once the facilities are built, Kentucky American has to simply pay the cost of the chemical and the power to get water into Lexington. And those costs would be shared with the Blue Grass Water Supply Commission. Comparing that across on purchasing water every single day at $1.71. Now, again, I have used the cost proposal that Louisville Water Company gave to the Blue Grass Water Supply Commission in December of last year. If there are adjustments that need to be made on that, we certainly can look at that, but at that time, that was the best proposal that we had from the Louisville Water Company, and that's what I've used in this comparison. So, the bottom line, as you can see, and I hope you all will understand a little bit more on why Kentucky American and the Blue Grass Water Supply Commission have said, when you look at the overall cost, any way you slice it at this point, the project we have proposed right now in front of the Public Service Commission is the cheapest, it's the best cost for the citizens of Central Kentucky. And that, at this point, I just want to wrap up that we're committed to seeing this project through because we know it's the right solution. And I hope, and I hope after you have an opportunity to look at the information, that you will come to the same conclusion that the Regional Water Supply Commission and the Attorney General and the Kentucky River Authority and the Blue Grass Ad and the Chamber of Commerce and the Owen County Chamber of Commerce have come to and have decided and supported our project going forward as the best solution for water supply in Central Kentucky. It's complete. It's ready to go. It's extremely well researched and documented. It's less expensive. And at this point, it's the fastest implementable project we can do. So, with that, I will turn this back over to Charlie. I think he had a few wrap-up comments. Actually, thank you very much, Linda. I really appreciate it. We're kind of running short on time. And I know council members have questions. And I know that one person asked to speak, Mayor Ed Bertner, asked me if he could speak. So I want to be sure he gets an opportunity. But we have a fair number of questions coming from council members. So, Charlie, unless there's something urgent, we might move on to the Mayor of Winchester. It's your pleasure, Madam Chair. That was my next move was to invite Mayor Bertner to make his comment. Okay. Very good. And, Mayor, before you come up, since Kentucky American brought forward actual numbers and cost comparisons, I wonder if Louisville folks have any comment on that. Had you seen this before? No. I just got a copy of it today, and we'll take a look at it. Okay. Okay. It's based on old numbers, I understand. From what Linda has provided, it's based upon numbers that were provided to the Blue Grass Water Supply Commission. So we would look through that evaluation. A very similar evaluation is that's what we're paying RWVAC to be able to come up with. So when that study is complete, we'll attempt to lay that out in a similar fashion. And she has a very good point. What we're looking at is a combination for the best decision of both the capital construction costs on the front end and the pipeline as a very cost-effective solution versus the operating costs, and then add those two together to see what ultimately is the lowest cost solution for Central Kentucky. Okay. Very good. Thank you. Welcome, Mayor Bertner. And I understand you're headed into a work session with your council this afternoon, so I appreciate your being here. Thank you. I appreciate the opportunity to be here. I appreciate the opportunity to meet with the urban county government, the full council, on July the 10th, and then again today. I have some comments that I would like to make. First of all, I'd like to separate my comments into two categories. The first is what I believe, and the second category is what I know. First of all, I think it's important that we take the long view with regard to this entire issue. I support regionalism. My work background began in 1976 when I first started working for the Big Sandy Area Development District in Prestonsburg, Kentucky, working with small municipal water supplying entities and water districts, and I witnessed then the difficulties that small entities have in serving their customers and their citizens. I support regionalism. I support interconnected systems. The model that I think that we need to observe is the model that exists in the natural gas and the electric industries. For generations now, the natural gas and electric industries have basically been interconnected. When there are deficits in one grid, then it's possible to pass natural gas and electric across the grids. Right now, we have, depending upon which study you listen to and which one you observe, we have somewhere on the order of 95% to 98% coverage across the commonwealth in terms of public water systems. But what we don't have is we do not have systems hooked together. Often, you'll have a municipal system that is right next door, just across the county line, that it's at the very edge or end of its system, and on the other side of the county line, there is another system that has built out from the county seat, and the systems are not hooked together. It is my view that both strategies of interconnectedness and regionalism, that both strategies will be strategies that will occur over the next generation. When I say generation, I was asked the other day what my view was in terms of how long the generation was, and my response was it's the biblical generation of 20 years. I believe that that's what you will see across the commonwealth. You will see large water producers and suppliers with reliable sources of water hooked together, pushing water to each other and through and to municipal systems. You've heard a lot of information, and I'm not a technical person. I will say this. Vernon Azevedo was the BWSC commissioner on the BWSC up until the end of July, and it came to me to decide whether or not to reappoint Vernon. Vernon has done an outstanding job with regard to shepherding these issues and these proposals. I did not reappoint Vernon, and the reason I did not is that I believe that this is an issue of paramount importance to the central Kentucky region. Now, I know education and drugs and transportation and growth and all of those issues are important. They are important issues. And I would be saying this even if we weren't eight inches under the average annual rainfall. But I appointed myself because I felt like it was important for local elected public officials to step up and become informed and become knowledgeable and take a position. Now, let me tell you what I know. That's what I believe. And I'm not a person who confuses the two, or at least I hope I'm not. I know people who are. But let me tell you now what I know. Let me focus on the 5 MGD. Linda did an outstanding job of identifying the proposal that you have before you, that is the BWSC Kentucky American proposal. And at the heart of it is the 20 MGD basic plant that Kentucky American is going to build. The rest of the plant will either be zero, 5 MGD, or 10 MGD. And basically what has to happen now, very quickly I might add, is there has to be negotiated agreements between the BWSC and Kentucky American, and then between the member entities that are going to take water from the 5 MGD and the BWSC. Those proposals are, those agreements are not in place. They're not in place. We have yet to negotiate those agreements. Out of the 5 MGD, one is for Nicholasville, one is for Georgetown, one is for Frankfurt, and two is for Winchester. In Nicholasville, Georgetown, and Frankfurt's case, you're talking about drought protection. In Winchester's case, you're talking about a critical situation. Because in 04-05, the City of Winchester, specifically three public bodies, the City Commission, Utility Commission, and Industrial Authority, had the opportunity to say yes or no to an industry, Sekisui. And based upon the assurance that BWSC would provide 1.6 million gallons per day, the City of Winchester said to Sekisui, we'll have the water for you. Now, if Vernon were standing here beside me and I asked him how much water we are pumping today, he would say slightly under 5 MGD. The amount of water for this one industry that we have to have available, depending upon the calendar that you look at, is 2009 or 2010, is 1.6 MGD as compared to the amount that we will pump today, which is slightly under 5. We have a rated capacity of roughly 6. There is some water there, but the math is pretty stark, pretty startling. Now, I also know, and you know, just by looking at a map, that we're sort of on the other side of the moon, that Nicholasville, Frankfurt, and Georgetown are fairly close, fairly proximate, but in order to get to Winchester, you've got to go through the Kentucky American system. And that's a critical point. So, as we talk about the Louisville water line proposal and the Kentucky American proposal, the Pool 3, build the line back, in either case, in order to get any of that water, we still have to build that line basically from the I-64-75 split back to Winchester so that we can get water to this industry. Our needs are immediate. Let me take the discussion I've just offered with regard to Sekisui off the table. Again, if Vernon were to be standing here, he would say that we're going to run out of water by the year 2011 or 2012 anyway. So, our needs are critical. Now, I think it should be noted and said, and I'm just going to make the statement and leave it there, that the Kentucky American proposal is a proposal that is intended to provide for growth through the year 2030. The 5MGD doesn't really do that. We are, in effect, you know, with our situation that I just described, it's right here. And the other three systems are basically looking for drought protection. Now, let me say that I support the Kentucky American BWSC strategy. I think it is what we need to do and where we need to go. I think the numbers need to be vetted. Vice Mayor Gray asked for a matrix to make a comparison, a true comparison between the Louisville Water Company's proposal and the BWSC Kentucky American. Frankly, based upon what we heard today, I'm not sure that your request for the matrix really has been satisfied just yet. Those are all technical issues. But I support the BWSC Kentucky American strategy. At the same time, I have to tell you that in my judgment, in a generation, both of these lines are going to be built. Both of these lines are going to be built. And the reason I say that is that I think we, as a region, central Kentucky region, I think we need to have the Twin River or the Dual River capability. In fact, part of the Kentucky American plan, I believe, was to eventually build a line from Pool 3 up to the Ohio River. That's been part of the discussion. But I think all of this is extremely important, good dialogue to have. You probably are, like so many of the communities in central Kentucky, looking at Bertner and saying, you know, you've got a problem. And Winchester does have a problem. And Winchester is going to solve that problem. I'm not sure if that resolution by 2009 and 2010 is going to involve, you know, a deal through BWSC with Kentucky American to build a water line along U.S. 60. I'm not sure if it's that or if it's building a water plant. And quite candidly, building a water plant and taking more water out of Pool 10 is something that we will explore in Winchester. The only other thing that I would like to say is that as we talk about the Kentucky River as an option, I would just like to point out that work is occurring at Pool 3, work is occurring at Pool 9, and no work is occurring at Pool 10, which is where we draw from. And I would just like to make a plea to anybody and everybody within eyeshot or hearing of this statement that might hear it. I know you all don't have a thing to do with it, but work on Pool 10 is pretty critical, pretty critical. Not only do we take water from Pool 3, but East Kentucky Power draws from Pool 3 as well at one of their power plants along the river. I appreciate the opportunity to be here. I support regionalism. I support interconnectedness. I appreciate the difficulty and the issues that you have before you. I support the BWSC approach. I support the Kentucky American approach. Having said that, I think after all of us are long gone, out of these offices, perhaps off of this earth, we will see all of our water systems hooked together, and frankly, I hope we do. Thank you very much. Mayor Bertner, thank you very much. I really appreciate your comments. Council Member James has a question. Thank you, Madam Chair. My question is for Linda with Water Company. Thank you for your presentation. I just needed clarification on something you said very quickly as you were going over your matrix, your grid, with relation to the operating expenses. Yes. I'm new here. You mentioned chemical and power. Can you explain to me what the operating expenses are? Okay. And, again, in trying to put together a cost comparison, and I don't know if it's possible to get that slide back up, the operating costs that we actually had to put an estimate in front of the Public Service Commission of what we thought it would take to operate the plant. Right now we have estimated that the optimal place to operate would be 6 million gallons a day, which is actually we could probably tweak that down, but we want to be realistic again. So what we were looking at was simply the cost of the chemicals to treat that 6 million gallons a day, the cost of the power to deliver that into Lexington, and then the labor for the operators that would be on site. And that is the comparison essentially to the cost of purchasing water from the Louisville Water Company. Okay. So that's primarily the only difference is just the water? Yes. So as far as you know, the 181.9 includes the labor? Yes. I'm assuming when they developed their wholesale rate, without getting into the details, they have included the cost of their facilities, the labor, the chemicals, the power. I mean, they're not paying a lot more for chemicals or power, but they're paying for the cost of their facilities in that rate. And so that's where it's really hard to make a comparison of apples to apples. So that's what we're trying to get all of the capital and all of the operating costs. Okay. Thank you. Appreciate that. Council Member Beard. Excuse me, Beard. Council Member Beard. At my peril, I might ask Mr. Calkins if he would like to come up here and answer a couple or three questions, but not that he didn't bend my ear on the D.C. fly-in. See, I kept my promise I was going to get you up to the microphone. Oh, boy. Okay. Two or three things. How do you get water to Garrett County? Don't you have to go across a bridge there, too? Yes, sir. Okay. I mean, obviously not with a 36-inch pipe or a 42-inch pipe. Right. The B-16. Yeah. Second question, how functionally ongoing is a 80-20 partnership? I thought the partnership was more like a 50-50. The 80-20 came from the five divided by 25 percentage in the treatment plan. Just based on that alone? Yes, sir. But how do you function and make decisions beyond that? I mean, is that five people in the room and four of them are Kentucky American Water Company? Well, our feeling, the actual details about that are what we're negotiating right now. We haven't met in the last four weeks due to the, in my view, distraction of the certificate case and the extra work that's been put upon the parties there. But that was straightly a mathematical percentage is all that that was. And we felt that if the DWSC itself was not going to own 100 percent of the facilities and sell water on a wholesale basis to Kentucky American, then we better do our dead level best to make sure that we own at least our 20 percent of it, which would be, in my view, far superior to owning nothing. Exactly. Yeah. And last question, the Scott County Reservoir, how does that fit in? Is there a requirement to have that in relationship to being able to supply Scott County with water directly from your grid? The assumptions that were made in the feasibility study that's been referred to today that was part of coming up with the 45 MGD 30-year water supply deficit, which because of the fact, as Mayor Berger pointed out, nothing's been done on 10. At 45, it's more like 55 as a result. The 45 was based on the premise that there was going to be a four- to six-foot raise in impounded water in Pool 10, and that's not happened. So the Scott County proposal in the feasibility study assumed no reservoir. Okay. The DWSC's position is the more sources of raw water that we have in this region, being that we're not on the river as Cincinnati or Louisville is, the better off everyone is. Okay. Thank you very much. Thank you. Council Member Crosby. Yes. I just actually have a question maybe for you, Madam Chair. It appears to me that it's been about, you know, since 1999, since this council has had any real discussion about the water supply issue. And from what I can understand today, I've heard two completely different things from both parties interested. And is there any way we could get some kind of opinion, whether it's from our legal department to write a letter or what to the State Transportation Department? I don't see what the purpose is if we don't even know. If we're being told that they can do this from one side and that they cannot with the pipeline, is there any way, rather than hearing from the interested parties, that we can get our own opinion to move forward? Are you referring to the I-64 corridor? Yes. The I-64 corridor. I don't know that we have any of our legal folks here, but I'm not sure what the process is. I would presume Louisville Water Company. Do you want to speak to what you're doing to get the answer? Because I think that's a good point, either they can or they can't. What we would need to do is meet with the state highway transportation officials and federal officials to once again ask them would they allow the pipeline to be installed inside the right-of-way, reconsidering the fact that the road is being widened to the center. And that would be a decision by them. And that could be asked by us or it could be asked by Lexington or any party, including Kentucky American, to see if their decision has changed since 1999. Wouldn't we have that type of answer from them? What I mentioned earlier today would depend on how long they take to review. That may be immediate or it may be months before they would provide that answer. It would be up to them. Actually, one thing that occurred to us up here is that the MPO meets tomorrow, and that question could actually be posed by LFUCG representatives as a, I'm sure they can't actually answer tomorrow, but at least to put it in the mix for those council members who attend that meeting. So that's also a possibility because state folks will be here. I think that would be a good question for them. Again, my comments would be we know that pipelines have been built inside right-of-ways in the past, so this is not a new request. Second, we know that pipelines have been attached to bridges in the past. We have several. Third is, we'll make sure that there's no confusion, that we're not saying that the only way to get water to Lexington is if the pipeline is inside the right-of-way. We're saying that could be a very cost-effective way to be able to get the pipeline and do it concurrent with the construction. In the event the permit is not granted for either the entire length or a portion thereof, the pipeline would be built parallel to the interstate in easements parallel to the interstate. So the project is still viable. The water line will be put in easements. Does that, Council Member Crosby? Well, and then that brings in some issues of cost increases and everything, but I think due to time maybe I would feel more comfortable if it came from us maybe to the NPO committee rather than, because, again, I just heard two different things, and there's two parties that are very interested. So maybe if we have a neutral, us being the body that might be neutral to get that opinion. Okay. Very good. Very good. Council Members, we do have more questions, and we have folks arriving for a 3 o'clock work session. So my question to you would be, do you want to continue this next month so that everyone can be heard? Council Member Stephens? Yes, I think this process is too important to terminate right now, and I would recommend that we carry it over to next month's meeting. Would I? I so move. You so move. I have a motion to continue the questions next month. Do I hear a second? I'll second, and I would like to amend it to an extent, if I may. Not an amendment to the motion, but it's a comment to the second. Okay. I want to, I know all the Council Members share this sentiment. We've got a couple of minutes, but I want to thank Council Member Gordon for calling these meetings and for calling it, of course, the significance of this issue to our attention. It also was important for me because it allowed me to go to two of the Blue Grass Water Supply Commission meetings, and I want to say that what I learned in the process was very meaningful, and I want to especially recognize those people from the community, those communities all around Lexington, our regional partners in this, for their efforts, and make the point, at least on my behalf, speaking on my own behalf, that our efforts to be open to new data and information is something that's worthwhile. I personally also believe and want to affirm the work that all of you have done and acknowledge, too, that if we've got a water supply problem, that we need to move on with it as expediently, as expeditiously as we can, and I'm hopeful that as we collect this data at our next meeting, that we certainly don't interrupt any movement forward to solve this problem. We have a motion on the floor, and I might ask, looking at Kentucky American folks, Louisville folks, water supply folks, can you bear to come back one more time before we vote on this? Because I think it really is important to allow the questions that need to be answered. We'd be glad to do that, Madam Chair. Okay. And just for Councilman Cross, I just want to give you some comfort that your legal counsel for this city has intervened in a water supply case, so any questions that you don't get answered through this process or our next meeting will definitely be, will come out in front of the Public Service Commission. It's a very transparent process. I just don't want you to feel the pressure of having all these engineering answers. Is the, there's been a question about the Public Service Commission date. Is that in October? There's several public hearings, one here in Lexington. I forgot the date of that. But the actual hearing in front of the commission is October 18th. October 18th. The next planning committee meeting is at 1 o'clock on September the 18th. So the motion on the floor is to continue this discussion on September the 18th at the 1 o'clock planning meeting. Is there any other comment about the motion? Yes. I do have a comment as far as placement on the docket. Is that related to the motion? Placement on the schedule for that meeting. I do think that there are a couple of other things that we'd just like to bring up that may not take the entire length of time. However, I could see how we could talk about this for meeting after meeting. Is there any way that we could get? It would be my sense we would do this first so that everybody can go back to their work. And then the Downtown Development Authority issue would be next. And I don't foresee this taking the whole meeting in September. It would just be to allow the rest of the questioning. Does that suit council members? Any other questions? Okay. Those in favor of hearing this in a continuation on September the 8th, please say aye. Aye. 18. Any nays? And I do want to thank all of you, Nick and Linda and Greg and Vince and everybody who came. Mayor from Winchester, thank you very much. Madam, one last thing. I'm sorry. I'm at the calendar. That is the date that we'll be in Frankfort for the public hearing on the rape proceeding. Your legal counsel will be there as well. So we'll have to work around that somehow. Okay. That is 18th, I think you said, is your next meeting. At 1 o'clock. Yeah. We'll actually be in Frankfort on the witness stand for other reasons. Is there anyone who could be here on your behalf? Well, we'll have someone here, but me and Linda both will probably be testifying that day. Okay. So I think we can talk to you offline about that. Okay. Very good. If there's no other business, this meeting is adjourned.