captions Language: en Wednesday uh July 12th uh Town board Webster Town board Workshop a day earlier than usual because of the fireman's parade and Carnival tomorrow we have three agenda items tonight um so we will start off with the first one uh presentation and a discussion with Paul Adams the town finance director and a proposed debt management policy so Paul I'll handlebatania all right Tom uh yeah a few weeks ago I put together this uh debt management policy with everything we have going on it is a best practice item so I thought I thought it'd be a great idea to actually put a policy into place uh to give us some guidelines going forward over the next few few weeks and into the future uh the first page basically describes the purpose of the policy it basically provides guidelines for decision making on debt and long-term capital planning it really goes hand in hand with the five-year long-term capital plan which we're also trying to implement some of the advantages include the ability to make quality decisions it helps you to rationalize your decision-making process it identifies objectives it demonstrates a commitment to long-term financial planning which is important in any organization and it is also regarded very positively by the rating agencies we are looked at on an annual basis by Moody's which you may or may not realize and they actually uh contact me they take a look at the auditor financial statement the annual update document and a continuing disclosure document that our consultant missile Solutions puts together and they actually rate US they basically give us that credit rating each year so so some of the objectives of the policy [Music] so the town will finance capital projects to the issuance of debt for the shortest period practical typically our project will be assigned uh what's called a PPU or a period of probable usefulness as I said um that you're actually restricted you can't Finance uh beyond that PPU date and as I said a minute ago it goes hand in hand with a five-year Capital plan some of the purposes after which debt may be issued um if you get into an emergency situation you can certainly issue debt um we this sets forth some guidelines [Music] where we would like to limit or actually put a minimum amount of 250 000 for the issuance of debt if there was a need for under that amount we hopefully we could finance that via fund balance or through some other means um item e just mentions that once again it ties into the capital plan there are various legal limits statutory limits the there's an overall limit of seven percent of the full assessed value and that's based on a five-year average for the town that's basically approximately 290 million dollars is the overall limit on debt for this policy we've actually put in some limits the aggregation of debt according to this policy we'd like to see that limited to about eight times the receipts from taxation which for the town is about 161 million general purpose debt we'd like to limit to four times which is about 80 million and water pollution control purposes we'd like to limit that to about five times annual taxation which is about 101 million with what we have coming up we'll actually be we'll be coming right up on that number so I guess we could we could determine this is our policy we could determine if we actually wanted to make that six times but but five times does fifth uh just to just to tell you where we're currently at as far as debt goes at the end of 2022 we had outstanding serial font out of about 16 million we're going to be borrowing through a bonded participation note sometime in the next two months which will will probably finish 2023 with about 65 million in debt and 2024 with about 140 million and if we put through everything that's currently on the table uh the various types of debt as I mentioned Bond anticipation notes are typically used to finance projects they're short-term debt uh they're one one year at a time typically you can do a band for five consecutive years and at that point it needs to be rolled into a Serial Bond there's lease purchase financing that would be used for things like copiers exercise equipment things like that that's what typically what was known as a capital lease where you would be it's structured as a lease but you're actually purchasing the equipment um on this page long-term debt a Geo bonds that's as I just said once the bands mature and what you reach is the max of five years that it is rolled into a cereal bun which is typically what we've done there are some restrictions on debt issuance uh you cannot you cannot actually get into a derivative agreement attributors are basically a financial contract whose value is dependent on an underlying asset so it's almost like you're giving up ownership of an asset to repurchase it back those were outlawed a number of years ago as they do come with quite a bit of risk the structural features of debt so I'd like to Target the annual debt increase to five percent is a general rule but uh with what we have currently going on this year we'll certainly exceed that five percent but as a policy I think that's a good goal debt repayment uh we would like the the town will endeavor to stretch the newborn issues so that at least 50 percent at a minimum is repaid over a 15-year period to try to limit the amount that accumulates [Music] and then we have some credit objectives these are basic calculations that you can do to uh to kind of see where you're at so as far as the debt as a percentage of assessed value we're currently at 0.40 percent I expect to be at 1.6 percent for 20 at the end of 23 and 3.4 percent of the end of 24.
uh debt per capita we're currently at about 352 dollars it's going to go to about 1434 for 23 and about 3088 for 24. then there are some other Debt Service indicators that can be used just to to determine if you're I'm a little debt is appropriate [Music] uh method of sale typically the bands and the bonds are sold through competitive sale that's handled by Municipal Solutions our consultant in conjunction with Harris Beach our legal legal counsel Bond Council but you can do negotiated sales and private placements I can't say that I've ever seen that happen within government within this government within this town it's typically used competitive cell then there is a EFC as well EFC armed for just financing options so that that's always an option for a low interest loan [Music] selection of Consultants as I mentioned we currently use Harris Beach or bio Council Municipal Solutions it's just provides some guidelines that they will work you want to nationally recognize bonds Council firm and you want a consultant that certainly has the proper SEC and and msrb credentials refunding of long-term debt this is just another word for refinancing our our bonds are structured so they can be refinanced or refunded um at any time so interest rates are running a bit High rate now so in the future of interest rates drop we will be able to refund those bonds or refinance those uh section K discusses Arbitrage essentially Arbitrage and it does not allow the town to the rules do not allow the town to borrow money at a low interest rate and turn around and invest that money so that's something we're going to need to be careful of in the next year or two we can earn a little interest but but we have to keep it minimal and that is something that is monitored by our consultant section c the continuing disclosure each spring I actually go through this process with Municipal Solutions it's an extensive document that uh there's many many details about the town and killing population and largest taxpayers and it incorporates our audit report and this continued disclosure is required by the SEC since the bonds are ultimately sold to the public they typically are sold through two mutual funds who in turn they become Investments of the public section I just states that we will make an effort to integrate this with the long-term capital plan yeah the investment of County proceeds just basically won't comply with New York state and federal laws we're going forward so that's essentially the key uh the key elements within the policy as I did said I think it's uh I think it's important I'd like to see the town adopted sometime in the next few weeks and I think it fits in nicely so if you have any questions or concerns feel free to let me know what those are I I want to put a lot there and there is a lot to look at but I just want to thank you because I know that you've been um you've been very instrumental in uh guiding Us in in developing policies such as fund balance and that and I I think that these are really good steps that we need to take so I want to thank you for your work on this thank you Patty thanks Paul very appropriate to put this together thanks yeah it'll reflect very positively they mean it's something that the rating agencies look for so it definitely will be a positive Paul um quick question uh this 12 Pages um is is this a template you got from the Comptroller's office I actually started with a template that I got from Municipal Solutions okay yeah and it's interesting you would set you'd well you've made many comments during the presentation about how we're in an interesting time right now at the town with some of the bonding right and all that uh I think it was on page four you commented and the water pollution in this proposal it's five times annual receipts which based on us would be 101 million uh base Center current receipts uh and you said well you know we could change that this is a draft to six times Well I I'm not in a vacuum I'm not looking to change it if where did these eight times four times five times come from is that yes is the recommended level these are the recommended okay we can leave it at five times I also thought I don't know it's as much as a question as a comment on that same pays the legal limitations and Charlie I'm new to this still I know I can't in three and a half years did you did anybody on this board know that this that there is a seven percent of a five year average once about once every three years yeah well I mean somebody will laugh at her it'll come up yeah I've I've seen that before and I've I I Know Myself and I can't recall exactly in what uh context but I know I definitely have as Talent attorney well across this particular section yes well certainly article 8 is well known to anybody who's dealing with the state constitution but yes that uh that's right in our New York state constitution yeah and obviously when you look at our full assessed value 100 value of the town uh that seven percent is 290 million dollars legally we can't go into debt more than that right um well luckily we're not we're actually not going to be approaching that no actually I think I think the way it comes up and Paul will know this too oftentimes I have to do a letter stating or confirming the uh I don't know what you would say the viability of the town's finances so right it's a boilerplate letter sure but um for much of the bonding I'll have to do a legal counsels and of course I'll refer to Paul because he's the expert but then I'll sign off but that's really where this comes on okay um other than that uh I mean Paul I'll have to go back in my you did a presentation on the fund balance policy draft to this board two years ago or whatever yeah and then we went back and forth like patty just said got to look at it absorb it think about you know and then come up with you know questions or comments on maybe adapting this that we we've done came up with the final fund balance policy I don't remember the time frame whether it was like the board meeting after your presentation or if it was within two months um I think we would all agree on this board that fund balance policy is really assisted Us in the last couple years yeah it has become part of the the overall Town budget policy it's been helpful it really has been and um you know I use the analogy that instead of figuring out on that fund balance policy well how much should we take out of the fund to lower taxes whatever and putting your finger up in the air just subjectively coming up with that or the configuration of a town board changes all the time that finger in the air changes all the time right having something in writing it's not like the town board couldn't in the future change that fund balance policy but having it in place really it sets the tone for how to fiscally manage the talent in a responsible way and I think and you and I have talked I think this debt management policy is right up the same now yeah it is so I think most talents don't have a debt policy but yeah yeah it's good practice I'm anxious to get it in place I do want to see what process we took during the fund balance policy just so we have a benchmark of how quickly between when you first presented that to the board to adoption yeah did it take yeah so could take some time to look at it yeah all right sounds good this is by the way tonight is the Paul Adams show tip your bartenders he'll be here all week his second item up tonight is you guessed it an update and a discussion with our esteemed Finance director Paul Adams regarding the town's arpa funds arpa funds I guess all right uh so we just I just basically brought in the spreadsheet um let me see I'm gonna wear my uh oh here we go try to reduce this a little bit so when we started this process with the arpa money uh we determined that we got about four million fifty thousand dollars so we determined that uh 350 000 we're going to go to Grants which is up here uh two million 500 000 was going to be devoted to the wastewater treatment plant with the phase two project and the remaining 1 million would be for General government services which actually gives quite a bit of flexibility as to how they can be spent so so as of today we have spent uh the 350 000 at Grants which were given out last July we've actually spent the entire two million five hundred thousand that was devoted to the Sewer treatment plant and we've only spent 33 900 of the general government services so the remaining upper funds is a million one 66.
so what you have until the end of 2024 to obligate These funds and you have until the end of 2026 to actually spend these funds so we should start to come up with a strategy uh to put these funds to good use there are a number of options which we discussed previously but as I said there's a lot of flexibility so you're not necessarily restricted to well this debate or 10 things well you know uh it's funny because uh that reconciliation you just did we have 1.166 million left in that General government services a lot of latitude heretofore there's been you know almost a is something comes up and we're like well we could use the arpa funds for that kind of more of a reactive as something comes up and on the other side of the coin there is do we come up with a strategy by the board and view of well this is what we're going to use the 1.1664 and obligated by the end of 24 and spend it by the end of 26 and um I really don't know if the town board is really decided on which of those ends of the spectrum we want to do um wait till things come up and say hey should we use the arbor funds for that or be more of a proactive you know I know we're starting to talk to the town departments on that five-year Capital thing like which what are you looking for that might not fit into an annual budget for the next five years right uh that maybe would give some um you know clear Clue Into what might be used for arpa because without spending it by the end of 26 we have three more budget years that we could use this for for Stuff that is not going to go into the budget so there's a lot of different ways to attack this um we're not here to make a decision tonight in that but what what is the board members feelings on those two ends of the spectrum the only thing I recall talking about potentially using some arbifies was or a new pump truck for the uh wastewater treatment plant given the amount of money that we've spent in the past year and repairs so that's the only thing I recall discussing potentially I would prefer to see that five-year look and determine just what what it should be dedicated to I'm just throwing it throwing it at things that come up I don't think is a real good use of those funds what's the cost of that truck uh estimating about a half a million dollars okay and actually we'll be meeting with one of our vendors starting tomorrow thanks it's a big chunk knock on wood it's it's probably okay we'll get through the year maybe I haven't shared with you but you're absolutely right Jenny what are your thoughts on this I think it's a one meeting whatever we have it's not cut for the budget will be about to proceed um so I I think we can test do what you know last fall um community and see what you know what the fun is going to be good for them you were gonna elevated bill got a highway project coming up towards that yeah you know it's funny and I'm in bill ever played in one of those golf tournaments where you can buy the uh The Mulligans like you know extra pod or this and that and you're playing with a group of people and it's like uh well how do you manage that do you use them early on or if you ever run into one where you you saved it to the end and all of a sudden you're on the 18th hole and you're like you waited too long and I use that analogy because if we just wait for things to come along my concern is that we're going to get into the middle of 2026 and end up using this million dollars for stuff that if we would have thought it out in advance you know so I think and especially as we go into 24 sometime between now and the beginning of 24 Paul thank you for giving this presentation because it's shined a light on all the key performance indicators of this if you want to call it how much has been spent this dedicated somehow and if it's in another Workshop or whatever or if we get out of the budget process and we look at this five-year look forward by the town department heads starting to put together a list of things like Bill said with the highway department and what's going on there and have a list to look at and by the end of the year you know going into 24 while and I'd like to make this decision why bill is still on the board to be honest with you um that we I don't know if that has to be done by resolution or whatever but the board says this is what we're going to use this 1.1664 even if it's over you know the three-year period of 24 because to 26 it's got to be all spent by 26.
so um that would be my suggestion it'd be good so let us solidify it with a resolution yeah so there's a significant portion of that money that we've spent already was utilized for the wastewater treatment plant section uh phase two so it would make sense that we take a look at spending some of that money if not most or all of it and the highway Department's new building it's worth having a discussion yeah yeah we could put it towards some of the consultant fees we have to pay for the highway project I mean one example [Music] anything else going on oh all right well we did that just put us a little bit ahead of schedule our our last item tonight um Paul is part of but he's not the whole kitten caboodle I would say because uh Bob Wimmer from Navitas and art Patron from uh our Deputy DTW commissioner and the head of the sewer department along with Paul are going to give a presentation on the potential bonding increase on the sanitary sewer plant project um and as everybody knows uh we have a public hearing two weeks from tomorrow here in this boardroom it's 6 30 p.m um to hear what people think about that uh increase in the bonding and then when they're done with that Paul is going to present a separate um uh presentation without Bob and art on uh the comida and host Community agreement effect in taxes on the Fairlife project so I'll hand the Baton to Bob Paul all right thank you supervisor so uh obviously as you just mentioned uh there's a large project really underway at the sewer department we signed contracts a couple weeks ago the equipment is being mobilized as we speak and we just sort of wanted to go through some of the impacts of the capital project that we have so as we all know uh Fairlife is come to town they are coming to town with their 750 000 square foot facility uh supporting up to 80 000 uh cows a day creating 250 000 uh new jobs and that impact of that facility is the equivalent of 9 000 new homes coming into Webster so what will you part of what will we will be doing and constructing at the plant is uh really building out the xxxs reserve that we need to have at the plant Fairlife will be taking all that we have and we need to buy Regulatory Compliance have excess reserve and they'll also allow any continued growth within the town so project is sort of we broke it out into a couple different ways to look at it uh one is we've talked numerous times is the asset renewal portion of it is really just replacing what we have currently that is Antiquated and obsolete then there's a resource recovery revenue and efficiency projects uh the biosolids the organic waste receiving and the processing facility and this is going to create that fertilizer for us save energy and actually create different revenue streams and then there's the capacity recovery portion of it again this is utilizing Fair life is utilizing all of our current excess capacity and we need to build that out again um that's going to include it expansion of our grit removal system our head Works primary killer fires aeration basins diffusers and really increasing the size of most of our processes so as we've been moving forward and trying to uh navigate uh the project tying it into Fairlife and trying to match fairlace timeline we've created two different lists if you will items that are unaffected by Fairlife which we're starting construction on now admin buildings site prep some of the hard works you'll see some some tankage truck scales and skated controls scada is the computer system that we utilize to control the entire plant right now we control maybe about 60 percent of it so Rick and his team need those electronic controls and that data inputs obviously up upgrading security fiber optics like lighting fire protection so on the second portion of this are the items that uh we will be Hub sizing if you will now we talked about Great Removal cup sizing primary clarifiers aeration basins uh the electricity service to some of our buildings uh some of the switch gear aeration blowers which are in dire need of replacement Rick is struggling with with those on a daily basis uh ferric storage digester tanks are flaring gas collection Systems off the digesters uh criminal flare is does not work and is out of compliance uh bile salt dewatering which will in the dryer which will get us that fertilizer product and limit our Reliance on landfills so uh nice overview I think this was from Karen of the facility and some of the items that are going to be touched again aeration systems clarifiers new biosol it's building you see a trickling filter in there that is the villages and is pretty much defunct hasn't been used in years we'll be uh Gathering that that real estate you see the head Works building and our chemical feed aeration blower buildings uh you want to talk about this one certainly so one of the tenets of this project has been to find ways to get the most value for the capital that is invested in the project so the the asset renewal component of it that art went through these are elements that there's not a lot of opportunity to find either additional savings or Revenue so this is the the analogy has been this is maintaining the house so this is replacing the roof this is replacing the siding there's not a lot of savings that come from that the other half of the project is the components that provide either a savings so reducing the electrical consumption reducing the amount of money that is spent sending sludge to the landfill the amount of natural gas consumption that is utilized to heat the buildings and the digesters and also the ability to bring in other revenue streams such as the high strength organic waste so this is waste from the production of different food products that can be converted in the anaerobic digester so this is something where waste haulers would provide Revenue to the town in order to take care of that waste and then also talking about a little bit of the recovery of the capacity that fair life will be utilizing is that fair Life as a commercial industrial user will be paying a cost for the treatment of their Wastewater so that's a service that Webster will be providing but that comes with a significant amount of Revenue in terms of treating that Wastewater so that capacity recovery also is a in effect a revenue generating savings mechanism so all told all of that project both the asset renewal and the resource recovery and the capacity recovery total out to 81.5 million dollars but do General rate new revenue and savings of six million dollars on an annual basis overall so when you look at doing just the asset renewal which provides no savings that's just an investment that has to be made but when combined with the remainder of the project provides an opportunity to generate additional savings and Paul has some examples of how this impacts the the rate structure yeah this next slide actually shows the uh deviation from the current uh sewer rent which is made up of the O M rate and the capital charge for 2023 it's it's approximately 232 dollars in total so the green line is uh asset renewal only is that uh 38 million dollar that Bob just referred to um so as you can see the cost the increase to the rates is consistently High year to year if you're only to do asset renewal the Blue Line factors in the cost savings and the additional Revenue that Bob had previously mentioned so as you can see 2025 is a tough tough year um you know this projection has been done without accounting for any grants we don't have any Grant commitments at this point although we're hopeful so this is what we consider to be worst case scenario so 2025 is tough because you've got the full load of the debt servers coming in but Coca-Cola Fairlife won't be operational until around October 1st of 25 so you're only going to get at the at most the quarter year of the revenue so it's a tough year to get through once we get past 25 things smooth out uh the rate should drop to around 300 of course it'll go up over time due to inflation and other costs but it becomes much more manageable once they're fully operational on the next slide this this breaks down the various cost savings and uh and revenue the first block actually shows the the cost of The Debt Service for the project other than the fair life piece it's about 4.1 million dollars a year the second block shows 1.7 million which is the death service on the Coca-Cola Fairlife piece that's followed by increased cost of about a million dollars I should say that the these dollar amounts are actually based on a projected 30-year average so but those increased costs include things like gas electric and chemicals because obviously you're going to be treating uh 1.5 million more gallons of waste a day so it's going to take a lot more uh the the chemicals and everything else you use to treat it the fourth red block is actually the average 30-year cost for a compensation employee benefits for some new employees that are planned to be added that's about 510 000.
and then the green are the revenues the first is outside liquid waste Revenue of about 800 000 a year and then we have outside biocellage cake Revenue about 620. and operating costs operating cost savings of about I think that's 970 000 a year and that comes uh mainly from sludge hauling as you know we we do transport most of the sludge right now to a landfill and it's becoming more expensive each year and it's projected to go up and up and up so a significant amount of savings will be generated by drying the sludge and getting the Solace fertilizer you or utilized otherwise and electricity cost too will be there'll be some savings there uh the fourth Green Block those are the commercial buildings for edu's basically Fair life will be charged an industrial use charge which we think now is going to be around two and a half or 2.6 million a year in addition to that though we build an edu so for every 60 000 gallons that we process they're charged one edu which is that 232 dollars that I mentioned previously which is the current year rate that may be higher or lower in the future but they'll be charged that for each sixty thousand gallons so we expect that will generate quite a bit of Revenue that could be could be in the range of two to three million a year once once we get rolling and then the last block there's 710 000 that's basically the amount that the residential rate payers will be well oh annually when everything is done and that they'll be just baked into the rate again Paul this is this includes no grants once again there's no grants you consider it uh worst case scenario and the last page I took a look at the uh the base of the revenue creation and the cost savings I compared it to the remaining amounts of Debt Service principle and uh just to just to demonstrate that over time the project actually does cover quite a bit of the debt service costs even though it's a staggering number to borrow uh we'll have 51 percent of the cost covered by 2025 and then it's in the 90 range after that uh 2024-0 because the plan is to pay interest only on the bands in 2024 and uh fairlife's really not going to be operational until October 1st of 25 so there won't be much or any Revenue to offset at that point so that's uh that's the most of it any questions or comments well John I think it's uh I think we've averaged about four dollars a month um as an increase and it's not cumulative I I did forget to mention that yeah uh we wanted to point out that for each million dollars that we receive as a grant that basically equates to four dollars on the edu so for every million dollars we get the edu should go down by four dollars so if we get 10 million you should go down forty dollars because that's that's 20 million less we'd have to borrow and this really drives to building a uh predictable and reliable wastewater treatment plant we certainly don't hiff now no we don't and so the board is aware of this uh we've had a veil failure which is an obsolete valve I talked to Patty a little bit about it today in Bob and uh Rick and really the whole team we've found available in California which would be second day airing to get it here and in next week sometime but that's how old the system is blanks were having to go to can't believe your phone I want to thank you for you for Gather um I know that we all at some point in this process if he had sticker shock when we've looked at these numbers I know we've been under criticism from some of the people out in the community I'm hoping that with this presentation tonight they'll look at things and realize why we're attempting to do the things that we are you know Patty I would like to add on to that I was going to jump in when Paul was talking about his the debt management and and that is that is such a key thing I live by that in my personal life and really none of this happens honestly without you know Paul's guidance uh you know going into these projects and so forth so everything that he is doing on the financing is really helping us all as department heads uh navigate through these uh through these numbers so I just want to throw that out there and you know this project is really it's a really an example of that you know we run everything through Paul and make sure it passes monster and through those processes and procedures that he's writing foreign well thank you for the presentation I learned a lot and I hope everybody else will too so we got a lot of work ahead of us and I know that Paul can steer to the right director well there's there's not a doubt in anyone's mind that we don't need significant upgrades to the uh sewage treatment plan I was up there and I think it was Monday or Tuesday um there's a significant amount of money being spent obviously to facilitate Fair Life coming to Webster which is which is a good thing and I know that you know there's some unanswered questions that we're looking forward to to getting but um again it's it's these these upgrades are much needed okay bill the upgrades are needed I hope the projections are correct that's my only concern well one of the nice Revenue projections are just that they're projections yeah they are if we don't reach them yep then it's a different story and that's uh you know I know this has been a I think I figured out that since June of 21.
in the last 100 board meetings in the last two years workshops or regular board meetings do you know that over 60 percent of them you guys know I like my numbers over 60 percent of our board meetings have have had this sewer project as resolutions on it or presentations on it we've spent a lot of time on this and early on in that June of 21 through December 22 was the town board's education and something that nobody had ever dealt with before which was an article 9 energy performance contract because here to four in this town everything had been done via Wix law low bid all of that and one of the things that I think was interesting about that uh performance contract with Bob wimmer's company is that it does present guarantees of the cost savings and of the revenues Patty I know you've gone to some of the monthly meetings uh where we have seen the companies that davitas has associated with that have gone out and you know within 100 miles of here gone and talked to companies and and who have said yes we will yeah we're going to bring our sludge there yes we're going to bring our uh whatever so one thing is like guessing on these revenues and me being an accountant and I've said it many times the only thing you can guarantee is expenses revenues are usually Bill a guess um this was the first time that I was like son of a gun um there are some at least with the way the landscape looks today I doubting Thomas I feel like I put my fingers in the holes during this process and I saw with my own eyes and ears that that those revenues are legit uh for the marketplace that's out there within 100 miles of this facility um so and I guess I only have the upsizing we have a five million gallon a day flow plant uh with the dec right and you don't want to put 5 million gallons a day through a 5 million gallon a day limit plant they DEC is what 80 percent of that is where you're pushing the limits is that about right if you see 95 percent over uh three quarters of the year they like you to do a plan of what you're going to do about it you're going to upgrade the plant or you can expand capacity right so until two months ago when Fairlife said they're coming to town our plans were to just upgrade this thing as another 5 million gallon a day plan capacity right is that correct yeah okay another hundred thousand gallons there was a little extra capacity okay and today with what is 17 000 edu's about 15 500 residences and another 1500 from commercial clients we're averaging 3.1 million gallons a day flowing through our sewer system into our plan for treatment correct so we're at about 62 capacity yes and no okay yeah because if you get up to 80 or 90 then right I got you I got you play along but okay so the slide where you said well here's the 14 million that really now we got to go from 5 million to 7 million gallons a day capacity with DC and that's because Coca-Cola Fairlife is going to be putting 1.5 million to 1.7 million gallons a day into our sewer plant is that correct up to two million up to two million okay so that means and obviously you showed in the chart the revenue that we get from the industrial rate and all that um at seven million gallons a day capacity that we're building to now all other factors being equal will be up on an average of about 5 million gallons a day coming through the one point three point one we're getting now plus Fair life at full capacity which would the dec means we're well below their limits and we still have growth potential yes okay all right that's good can you go back two screens uh three screens all right because I just want to make sure that when someone looks at this they they understand that when they see the green line at 250 I think that's 250 right it's a little above 250 about two that doesn't mean that we're saying that that's what the edu charge between o m and capital is going to be that's what the increase would be so from a point of reference if we're at 232 dollars a year right now in 2023 you're saying that if we just did asset renewal our edu charge o m and capital would go up to 480 dollars a year but in a weird way if we do more than the 38 million dollar asset renewal and go to the 81 million 500 the increase is the blue purple per year which is what I you're you're basically around three hundred dollars total it goes up I mean after the first two years which let's just call it what it is 24 and 25 is a tough one for us on this financially you got money being borrowed to build the sewer plant and while it's being built we're not getting the revenue from septage and all that stuff it's being built and in parallel to that fair life is building their plant hopefully in 2023 and 24.
so they're not ready to send us any flow those are tough years I think we're being very transparent about that and I do like the fact that this was run with no grants any grants that come in make this better correct you just can I add one to Bill's comment just that and that is a concern obviously revenue and you know that's sometimes an unknown but the majority of that revenue and savings is off of Fairlife so the majority of that Revenue generation is from them out of all of the other unknowns so that's kind of a known but just so you know we'll have some outside waist which there's a lot out there but the majority is from Fairly and Paul when you were describing the breakdown of that industrial use uh rate in that bar on that one for that that is fairly um that is tantamount within that to them making good and us having to build the plant to seven million gallons a day from five million yeah it's covering a good part of our debt service to build that portion of the plant that we need to build to accept their capacity one other piece of conservatism that we've also put into this is that the revenue projections for the outside waste and the cake Revenue only account for 60 percent of the capacity of the facility so we did not project utilizing every piece of uh new capacity this is only 60 percent of the potential capacity of the facility to take in outside septage or outside kick which gives us upside down there yes so there's additional website and they're like to that point uh when Rick and I started this project with uh b l we were very very conservative on those numbers and looking at what we've done in what the town has done in the past for those revenues and that really kept them tight uh you know leaving a lot of room for upside anything else on this part okay anything Paul you want to take a crack at the the next slide deck that uh is is as long as we've talked about Coca-Cola Fair life we figured we'd uh show a little analysis of comida which is uh well Paul will get into it and post Community agreements that is a keyword that's flowing around the town of Webster for the last 15 20 years so I gotta log back in sorry what's that I have to log math back in okay got a commercial break ERS I know it is it's it's yeah well you know what well it actually will still fall under the cable department so you're the liaison so you will have you'll drive the head boy home yes I will you are and as I've said uh I mean Kenny is a great liaison to the library but what you did is liaison to the library being the detective you were that was impressive I'd hire you Jen kins um yeah and I I apologize I probably should have uh [Music] long time ago so we're gonna just uh we got a few slides a few slides on uh we're gonna discuss Camino pilot agreements uh host Community agreements and their Fair life to explain uh comida is uh the county of Monroe Industrial Development agency they negotiate what are called pilot agreements which are payment in lieu of taxes with businesses that come in it does give them a tax break for a number of years typically what we've seen is a 10-year program it's called the jobs plus tax abatement from what I understand they do offer other programs which can go longer term but I'd say 99 of what we've seen has been 10 years so that's what we've used for this example so basically the the assessed value of the property is discounted over a 10-year period so the first year you'd be discounted 90 so you would take the assessed value times 10 percent times their tax rate and that's what you would pay um and it's something that the talent builds for separately it's not part of the tax rate not part of the tax bills that go out I should say so how does a host Community agreement work versus a community pilot program um basically the town steps in and strikes a separate agreement with the property owner for the amount so that we could collect the full amount of the Town tax rate based on the taxable assessed value I guess our position has always been that the town provides the most services to the property and it it's our right and it's worth it to the property owner to pay the full share of the of the taxes obviously we have a police department we have a highway department sewer of treatment these are all things that benefit the property directly so we took a look back at the various committee agreements since 2007 and three only three of 16 commutative program recipients actually executed a host agreement with the town that was stud Co receiving properties Webster auto mall and the Legends the remaining did not we did put Fair Life on Top as you can see we're expecting the full value of fair life to be 650 million when it's complete in late 2025 but as of right now Fair life has not applied for a kamita although whether they are expected to so just for example the the property that Fair Lake will be built on is about 120 Acres it's currently the current full full value is about two million dollars and it generates property tax revenue of about sixty eight hundred dollars for the town once it's fully developed the the fair market value will be we expect it to be 650 million dollars uh which will generate in the first year of kabida with a 90 discount it'll generate about two hundred thousand dollars of revenue for the town in year two 2028 will be at about four hundred thousand dollars of Revenue um so we we basically assumed that the assessment valuation equals projected project costs construction is completed on schedule and fear in life executes the standard Jobs Plus pilot program so there are a number of of assumptions but it's based on what we've seen historically so just just to explain this this two hundred thousand dollars of Revenue as I mentioned a couple minutes ago is build separately by the town in January of each year it's there's they do not receive a tax bill we bill it directly mm-hmm just to illustrate here the top 10 taxpayers in town as it stands right now this is based on their full market value the Xerox is number one our g e number two this is an aggregation of a number of properties uh core or Holt is number three and fair life when they come in at 10 percent of their assessed value will be at 65 million which will put them at number three even though it's only ten percent of their assessed value for full value I should say so you can see that the Major Impact this is going to have and that's just going to grow from there once they reach full value it'll be at 650 million so for this for this guy for this slide we've assumed that fair life assessment valuation equals projected project cost so there are some assumptions but we do know it's going to be a big number and they'll be right up there they'll be in the number one spot and in short notice that well that's it now Paul took one for the team on this one presenting um we have uh Donna Komar the town assessor is in the audience tonight um so depending upon any questions that the board members have about what Paul just presented um if they go beyond Financial things that Paul is our finance director uh should answer if they're more assessment based Donna we have you here to pull from the bullpen to answer so with that being said um does anybody have any questions or comments about the kumita and the hosts Community agreement presentation well one thing that stuck out well I was very surprised I should say to see that of all these projects that only three of the 16 um at Host agreements executed because I was under the impression based upon feedback I had gotten and received and I think all of us have heard that no projects come into Webster unless they sign a host agreement so that that was that was very interesting but as you said don't let the facts get in the way of a good story um I also were assuming that the committee agreement will be 10 years and I think somebody had mentioned that in a different locality a very large project went in it was like 15 or 20 years so it'll be interesting to see the agreement when it's uh put forth but this is a great job very very good information I appreciate it I've got a couple cameras if I may Charlie you know you may you may first of all um John you're right I thought the same thing I was surprised because we certainly have been requesting them but again a host Community agreement is something that's centered into voluntarily right so we'll leave it at that the we can congratulate and be appreciative of the businesses that have entered into the host agreement I also like to point out that there are pilot programs not only under comeda but under the private Housing Finance law and we have a number of those agencies if you will in town and almost all of them have given us host community that is CDs of Phillips Village pretty substantial ones actually so we've we have maintained those as well so even though they are not comida right they are exempt by terms of Pilots however we do have host Community agreements I think for just about everyone in the last I don't know 10 years or so you you know you were like that that can't be these are the kamita deals in the last 15 years three out of the 16 have host agreements there are other host agreements like you just said Charlie for other right uh incentive programs and this and that we don't to the best of our knowledge and Matt Chatfield you're here Webster Economic Development Alliance I I well number one we are being told that Coca-Cola Fairlife will apply to kamita with some type of proposal they have not done that as of July 12th so we're speculating uh on how many years what they're going to ask for this and that two the the type of things that you just explained Charlie would like CDs Monarch and all that those type of uh programs I do I have not heard that Coca-Cola Fairlife is no no no qualifies for them much less no those are houses they would not they were down so so we wanted to basically just use kamita um and look at the last 15 years of the committed deals in town and when we researched them three out of the um have host Community agreements like you said Charlie they're voluntary I think when you look at that list I can only speak to one of them on that list if you go back uh Paul uh because only one of these have been since I was became supervisor and that's the U of our facility on Hard Road and U of R was was very very clear to me that there's other towns lining up to have them put a facility like they did in town they're not going to do that uh host agreement and they said to me that's exactly what happened on Barrett Road in 2015 whatever year that was too and when you look at that list uh I think you start to see I mean it's an exact science but you're talking about Holiday Inn Xerox Hampton Inn is the Hilton Corporation these are Big corporations Wegmans big corporations I don't I guess with a straight face you could ask those corporations for for a post agreement um I guess you could with a straight face maybe somebody did ask them the straight face they must have said no if they were asked actually I I don't really have a problem with asking for a host agreement I think it's uh it's a responsible thing to do right well the host the host Community agreement uh is basically a request uh for the business the company the property owner to contribute right for the services rendered right and it you if it's only the town taxes which it is we're not negotiating on behalf of any other taxing jurisdiction we're talking 5.2 percent of the property tax so it's not we're not doing it for the school district right we're not doing it for the comedy and they get immediate services from the town they get police they get sewer they get right numerous other things Highway you know but I just look at some of those other projects and when you look at the and the totality of it um how many of those were Revenue generating to the town to the point where Fair life would be that is your point just off the top of the head anybody see one of those projects on there that is pushing a couple million dollars of sewer uh Annual fees no they all have toilets that flush but that's about it right and and this is and you know it and I think that far column the the total value look at those projects compared to Coca-Cola Fairlane that that just it's monstrous um and I've I've said since we were in the courting stage if you want to call it mad back when they were project Izzo and we had to keep a real lid on who they were we didn't even know who they were uh that it's just we don't have a precedent I don't even know you know Xerox when they came here in the 50s or 60s I don't even know if that's an appropriate precedent for how large this uh this is and if you approach them the same way you approach all the other projects which we I think are doing a good job of not approaching them that way we've never hired Woods oviat to oversee seeker and some developer coming into town have we nope no we've never gone to mrb and said can you help us with looking at the plans and the sketches well actually bill I'll ask you that you're you're the engineer is the town ever done that for to oversee and take a second look at some developer coming to town with a hundred house subdivision no not since I've been here okay and I don't blame him because 100 our subdivision is it's not bad that's massive no we're doing it I think we're doing this differently and we need to do it differently and uh you know John I will tell you this I'll uh respectfully agree to disagree with you that I'm not going to go with a straight face and ask the Coca-Cola Executives that I've been working with and Matt you've been working with to uh with a straight face and say we'd like you to get into a host agreement I wasn't saying you know about Coca-Cola I was just as a general oh rule thumb I agree with you I don't have it I agree with that I don't yes I agree I'm on the same page with respect to this project gotcha there's a general rule yeah and I agree with you on that I I kind of like the host agreement right and I didn't do enough I didn't do any research with Donna in the last couple of days on the other CDs Monarch and those things because I don't know what they are I know there are other host agreements and Paul and but they're not comedian correct so I don't know enough to be dangerous about what is it about CDs Monarch is it a housing thing is it a whatever that Coca-Cola would never go for that type of whatever they got well we could just we can discuss that later I don't think we need we need to connect but is it apples to oranges comparison yeah it's really not the same okay it's it's a pilot that's the only difference it's a pilot program it's permitted by Statute the pilot has to be permitted by Statute literally it's not yeah and one thing I will say as we were putting this together is that trying to figure out what God willing data you're still our assessor uh when they get their CFO going into 26.
all right we haven't even seen their building plans and this and that we're going by the fact that Coca-Cola is saying this is a 650 million dollar plant I don't know what that means I don't know if that's 650 million dollars of buildings assets whatever or if half of that is machinery you know what I mean we don't know we don't have those details so we use the 650 million dollar number because we're not going to audit how much they spend on building the thing somehow you go in when they're done and figure out uh through the laws and whatever what they're assessed for it could come in at half a 650 million dollars and I'll tell you what if you go back a screen thanks Paul uh no I guess go forward a screen the other one so you see that one right there let's say that Donna who follows the law very respected assessor teaches at the state of whatever I'd say it comes in at 325 million because of I don't know other is contents and all that stuff then you take that two hundred thousand dollars and that's a hundred thousand dollars I think the important thing is to look at that compared to the 6858 dollars that we got on grass I feel pretty confident whatever you assess that for which you will do by the book I have all the confidence in the world I'll bet you that we're going to be getting more than 68.58 from 100 acres of grass so enough said anything else ladies and gents well I want to thank everybody for coming and watching and uh midnight as Vinny's Old