June 21, 2023 Study Session

Transcript

Describer:

Castle Pines North Metro District

Study Session Agenda

Wednesday, June 21, 2023, at 5:30p.m – 7:30pm

7404 Yorkshire Drive, Castle Pines, CO 80108

I. Call study session to order.

II. Board roles, rules, and responsibilities – Kim Setter, District Attorney

a. Q&A

III. CPNMD Finances 101- Phyllis Brown & Sadie Whitworth, Finance

a. Q&A

IV. Adjourn.

Board President Jason Blankaert:

All right. Good evening and welcome to the Castle Pines North Metropolitan District study session. This is Wednesday, June 21st, 2023. about 5:35 p.m.. And I'd like to call this session to order. Can I take roll or do. We don't need roll today, do we? All right. Very good. So we'll skip that part. okay. So the first,

The, first order of business is the board rules, regulations and responsibilities, going to be given to us by Kim Seter, our district attorney.

District Manager Nathan Travis:

And I am going to jump in, interrupt really quick. One thing I forgot to add to the agenda just really fast for the new board members. We do have our two front office staff here, with us.

Just, introduce their names and faces. I'm going to make them stand up at the podium for a brief second.

Jason:

Welcome. Would you please introduce yourselves?

Nathan:

And so, we have Susan Nagel and, Jacqueline Fuentes.

Susan Nagel, CPNMD Staff:

Hi, I'm Susan, I'm the office operations manager.

Jacqueline Fuentes, CPNMD Staff:

Hi, I'm Jackie and the customer service specialist.

Jason:

Nice to meet you both.

Nathan:

All right. You guys can run away. That was it. Unless. Unless anybody has any questions for them. Perfect. Thank you guys so much for swinging out. All right. That's only going to be slightly more exciting than Kim, I'm sure. Here we go.

Legal Counsel Kim Seter, Esq.:

Yeah. Are we ready? I handed out to you the SDA board member manual. This is a pretty detailed document.

That's put together by the Special District Association, which is your trade association, and you are members. I have it hanging around on my desk because it's a good, quick reference to a lot of things. Doesn't go into a lot of the legal detail, but it has more detail then you're going to want to know about. I thought what we would do is run through a couple of the high points in here, just to give you an idea of things to be looking for.

As you know, Jason, you know, I'm always watching for opportunities to tell you something that that will help you learn more about the district life and what you're doing. And also, we have little training sessions along the way when something comes up. So I thought we'd just touch some of the very highest points and, get through this fairly quickly, and then we'll turn it over to Phyllis.

So if you look at the manual in front of you, there is a very good index or a table of contents at the front with lots of different topics. And then at the back there's a really good index. So if you have questions about something like annexations where you'll find out that we can't do annexations, you look up annexations in the back and it'll refer you to the page where it tells you there's no such thing.

So, very useful. And then if you turn to chapter one, we're not going to get into any detail about that. But there is board membership and district filing requirements. Those requirements are almost all legal requirements. So we take care of those for you. And, at the beginning of next year, we will deliver to you what we call the annual administrative resolution.

And Jason has done a couple of these now. That document lists all of the legal requirements of a special district board and then tells me that you're telling me to do that work. And that way, if I mess up, it's my fault, not yours. Same thing with Phyllis is work and the audit. And same thing with many of Nathan's pieces as well.

So what we try to do is to take the legal requirements that the law says you're supposed to fulfill and just have you delegate it right up front. And that way you've done your job. And if we mess up, you know who to point the finger at. If you turn to the second page, which I believe I'm seeing numbers on here, the page following the one that says board membership in the second column, there are fiduciary obligations of board members.

And these we will run into quite often. I want to point your attention to number two in the right hand column, confidential information. You'll likely become privy to confidential information when we go into executive sessions. And as we go through the budget process, particularly when you seek legal counsel, the communications with your lawyer, give me our attorney client privilege.

The thing about the attorney client privilege is it's your privilege. But if you go out and talk to somebody who is not on the board or me, you've waived the privilege and it's gone. That means at that point, the information that we talked about in executive session or, you know, somewhere back here in a corner becomes public information and it can be disastrous.

So particularly if we're talking about, real estate sales or contracts or, you know, a myriad of things. So we need to be very careful about executive sessions and, and, communications with the attorney remain communications with the attorney and among us. And, in fact, a lot of those Nathan won't even be involved in. So it's the board and me.

That's it. The attorney client privilege, as it says, can be waived. And then then the information can be used in a court. It can be very damaging. And you should not discuss matters discussed in executive session outside the executive session, or even among yourselves, outside of the executive session, or with me outside of the executive session.

If you flip over one, two, here's a chart three four pages to the chapter, chapter two conflicts of interest. At the beginning of the year, we'll present you with a letter describing potential conflicts of interest as well as forms to fill out and I'll explain to you at that time how to fill out the forms. The purpose of the forms is to give my firm some idea of what you do in your business, and if you have any side businesses, things that might create a conflict of interest.

The only reason we do that is because we want to protect the board's actions. So by law, you have to disclose a conflict of interest. We'll help you do that and make sure that you don't get tripped up. But mostly we're doing it to protect the board's actions, because if you vote with a conflict of interest, that vote can be overturned.

It would be really bad if we approved the budget and levied the taxes and then had that vote overturned, we'd all be in trouble at that point. So the conflicts of interest, one of the things in our statute, which is a little odd, is that you can cure a conflict of interest by simply disclosing it to the secretary of state.

And that's what we're looking for, is if something comes up, if we think it's a close call, we're going to ask you, can we disclose it. We'll disclose it. And then you're you're covered. So it's a good protection. It's an easy way to take care of the matter and, stay out of trouble.

There is a list at the bottom, starting at the bottom of the left hand column of potential conflicts and actual conflict. I don't think there's any surprises in there. A potential conflict is anything that might where you might vote as a board member for a contract that is going to inure to your benefit. So, you know, your spouse owns a printing company and you vote to give a contract for all the district printing and paper to that company.

That's a problem. But you can you can cure that default or cure that that conflict with that disclosure. You still shouldn't vote, but we can take care of the disclosure. Then in the right hand side, there's a couple of others. They're also nothing that would surprise you. Engaging in financial transactions with the district, which is actually prohibited.

So as a board member, you cannot directly engage in a financial transaction with the board. And we'll be watching for all that and that. Again, that's why we have you fill out that form. If you think about it, your the fact that you're in the district and pay taxes creates a conflict of interest. However, in the definition of a conflict of interest, it says your interest has to be different from everyone else's.

So everybody in the district has that problem. That one is we just gloss over. But it's the kind of thing you want to be aware of. So if you feel uncomfortable about something on the agenda, just let me know and we'll say it's it's an issue. It's not an issue. We'll disclose it. Don't vote. So,

Over on the right hand side of that page, just above all the white space in the right hand column, effect of existence, of potential conflict of interest. That's where it talks about the possibility of prosecution from failure to disclose, as well as the board actions being overturned. I have never seen anyone prosecuted for failure to disclose, and I've been doing this almost 40 years.

But it can happen. At least it doesn't happen in the district world. It happens in the city world pretty frequently. Next page board meetings, another area that we will we'll run across issues a lot. So the district's business is all conducted in meetings of the board, which the public must be given the opportunity to attend. And, with very there's very few exceptions, the main one being the executive sessions that we talked about, where we're going to talk about something that if it got out in the public, would spoil what we're trying to do for trying to buy by property.

We don't want somebody to know what we're willing to pay. So we keep that that kind of stuff in an executive session. Otherwise the public has to be allowed into the meetings and able to attend. So this meeting tonight, no one's is here but the notice was posted. The, call-in number is on the website and they're welcome to attend.

And you'll see the next regular meeting there will be attendees. These open meeting laws, they're called, were adopted because there was so much government business going on in the dark. And hopefully that this will change some of that. There are even cases where the United States Congress, there were people walking around the floor of the House handing checks, like oil companies literally handing checks as the votes were coming up.

So those kinds of things have come to an end. Luckily. In on the next page, the left hand column, item D, where it says open to the public. It's important to understand that any time you're talking about public business among board members, you are engaged in a meeting that is supposed to be open to the public. So right now we're doing that.

If you, if I ever send you an email with the document, a draft document in it, you'll see in that email, do not reply all. If you have a question, contact me directly. The reason is, if you start exchanging emails, you've started a meeting. And once you start that meeting, it has to be open to the public or it's an unlawful meeting.

If someone comes along and complains about that, first of all, the meeting is void. Whatever action was taken is gone. But the worst consequence is your emails are now public records. And believe me, even if there's nothing in there, you don't want to spend your time trying to find all your emails and turning them over to somebody at a newspaper, or someone who has a political agenda.

So, no discussions outside of the board meetings. And be very careful with the emails because it's it's so easy to start that conversation. It literally happens every other week where I'll realize that I'm on an email chain where we're all now chatting, and you got to say, that's stop. We'll do it at the meeting. So be very careful of that.

Rules of procedure at the bottom of that column. Those are the bylaws that I think I sent you copies of after the last meeting, so you could see the rules of the president, the secretary. You can change those bylaws and set them up however you want. You also have the right to control how these meetings take place.

So we have a public comment period. You don't have to have a public comment period. You can set rules for the public comment period. I just had a library district meeting this afternoon where they've decided because of all the gender related activities that are going on, they have so many people coming to talk about them that they can't get their business done.

So they're starting to adopt rules that say, we're going to have public comment three minutes a person. We aren't going to respond as the board, but we're going to listen. And it has to be on a topic on the agenda for that night, not some extraneous things. Years ago, I used to go out to Commerce City when we were forming some districts, and there was a lady who would come to every board meeting and talk about Walmart, and she always had a complaint about a Walmart product, and the city council actually knew she was coming.

When they did talk about a big pin that had run out of ink, and she was all upset about that, and they they gave her a beautiful cross pin with her name on it. And it was it was very funny, but you didn't have time for that kind of thing. On the right hand side of that column is a section on Executive Sessions, and we will occasionally have executive sessions.

The board, since I've started working here, has been very careful to have those as little as possible, and make sure that everything is out in the open. But there will be times when there are issues again, real estate issues, if we end up negotiating with another district to take over the water and sanitation stuff, we'll need some at that point.

And we'll be entering into those executive sessions. And again, whatever takes place in those executive sessions stays there. You have that fiduciary duty to keep that information to yourselves. And there's some, some other things listed there about executive sessions. But every time we go into one, we'll go quickly over these rules before we go back there.

And then when we come back, no action can be taken in an executive session, which is very difficult because you're talking about a topic and we're going to talk and it's hard to not realize, oh, we all agree or something like that, but it's just one of the things we have to be very careful of. No action back there, no votes.

And we usually go back into that conference room when we come back out here. Any motions can be made at that time. Until then, nothing happens in their information never leaves there.

Board Member Director James Mulvey:

Kim question, is there somebody, actually recording or taking notes?

Kim:

Yeah. Okay. So a couple of there's a bunch of rules about executive sessions. And one of them is that they have to be recorded because if somebody challenges the executive session or if, if, if you let information out and that executive session is suddenly dissolved, everyone has to have access to that recording.

I have a little tape recorder I bring that plugs into my computer, it downloads that executive session, and then in 90 days it erases it. So if anyone's going to complain about it, they have to do so within 90 days. Okay. Thank you. We do not make minutes of them. And. In the event we go in and there is going to be attorney client privileged information, I'll turn the recorder off and then afterwards, I have to do an affidavit to the Secretary of State saying this was attorney client privilege, and there's no recording and no one can get to that information.

So, executive sessions are interesting and they're a huge source of problems because everybody wants to know. And soon as you go in, it's like, what are they doing? And. But if we're careful, we've got good protections. On the right hand side of that page under item K is a discussion of the emails that we've already covered.

Yeah moving on to chapter four, public records. Again, the right the public has a right to access these records, the Colorado Open Records Act has a lengthy provisions for how the public can request information from you. And we have to provide it within 72 hours. If you've engaged in a, in exchanges of emails, they can ask for those.

If they do ask for them, we have to see if we can find them. If there if there was actually some conversation and produced them. The, the Open Records Act, a lot of it you'll hear about but not have to deal with because what's happened because of it is that a lot of, commercial industries use CORA, Colorado Open Records act now to contact me and say, hey, we want to see all the bids for that project, and we want to see your invoices for your chemicals because they want to compete.

And we just tell them bounce. And if they get really persistent, we'll give it to them. But, it's very frustrating. And it's starting to waste people's time. And it it is not within the, what the act was intended for. So but again, be aware, if you use your, your emails to have discussions, you may have to produce them under the Open Records Act.

Flipping over to the next page on the right. Chapter five Service plans. You don't need to worry about that. You have a service plan if you'd like to see it. I can show it to you. It's 25 years old. It's the document that actually forms the district at the very beginning. You're so far beyond it that there's really almost nothing in it that has any relevance anymore.

And there were a couple of amendments to it, but it's it's not important. Chapter six Boundary issues. These are discussions about how you can change your boundaries. Remember I said there's no annexations, but people can petition into the district. People can petition out of the district. You don't have any power to reach out and and scoop in property.

But if you're interested, there could be some of these in the future. We had some probably four years ago. You know, it's all the property over here came in, but there there shouldn't be much change from now on. Chapter seven property issues just deals with title. And, stuff again that you're not going to see much of. Chapter eight financial matters.

And I'll leave a lot of this to Phyllis. But one of your roles as a board of directors is to manage the district's financial matters. Item A entitled fees, rates, tolls and charges is very important for you. you get most of your revenue from user fees. So those are the fees you charge for sewer service and water service.

Though when we adopt those, the law not in the statutes but from the Supreme Court says that the fees have to be rational, related to the actual cost of service. That was a case that came out of Breckenridge, called Krupp. And it created a lot of turmoil because a lot of the developer districts were just charging, you know, whatever they need, whatever we need to build roads will charge one that will charge the sewer fee.

And, Krupp put an into that. And now kind of put us in a position where if we can't figure out what the fees ought to be for the service, you have to hire somebody to do that for you. A lot of districts do it as a matter of course, so that if they get sued, they've got somebody to go in and testify.

We have a company that does that for us, and I think it's up to be reviewed again. Is it this year or you talked to them recently I think? It seems like we've talked about it recently.

Nathan:

We did I hear this, I can't remember if it's this year or next year. I think it might be this year though.

Kim:

Yeah. So that'll be coming around. When we talk about the fees, there is a statute that requires us to give 30 days notice to all of our constituents the first time we talk about it. So Nathan will let me know, you know, when these people are going to talk to us or when he's going to bring it to you.

We'll publish something in the newspaper, put it on the website, we'll have it on the agenda. And then we'll start those those conversations about increasing or even decreasing the fees. On the right hand column, the mill levy, those are the taxes. A mill levy is just a way of calculating a dollar amount. So when you assessed your taxes or certify your taxes, the mill levy is a number.

Yours is very small. Maybe like three. Maybe that's not even that high point. Yeah, it's very small. But what that is, is one mill is one tenth of 1%. So it's a 10th of a penny. And that mill is imposed on every dollar of assessable value of a house. So to use simple numbers, if the house is worth $100,000, our Constitution has calculations that our legislature is now messing with on an annual basis, but ultimately you end up paying instead of on $100,000 on a currently on your house, you'll pay on $6,500, something like that.

And then that mill levy is, calculated against that amount. And then that's your your tax bill. And then you add that for every house, every commercial property pays 29% of its actual value. And then there's various other calculations for oil and gas and things like that. So we will do that annually. And Phyllis will tell you about how that happens.

Beginning in August, the budget process will begin, and that will ultimately end up with a mill levy and the fees, rates and tolls and charges that we just talked about to produce your revenue. a\As a government, aside from Tabor, which we'll talk about very briefly in a minute. it used to be you're entitled to whatever you need to operate the district.

So this budget process occurred with you putting together your budget. Calculate the numbers backwards that came to a mill levy and then you assessed it. It didn't matter how much it was or how little it was. That's what you got for the next year. The whole system is designed so that when you come up with that number, you will get it.

There's no fighting about that. You you may not get it all till the end of the next year. The budget year, but it will come in. And any shortages that come about for some changes you'll collect back the next year. So, it's a good financial position to be in. But again, because of politics, those are all becoming difficult issues.

And we have to we have to change the the calculations every year. I think the legislature has changed them the last three years. Three years ago they changed it for three years in the future. Then the next year they changed it for four years in the future, leaving the first one. And now there's a third one and they're all overlapping and it's a nightmare.

But by October, we'll have it figured out for you.

Jason:

And, Kim, just to clarify to, if we we can choose to temporarily decrease the meals that we collect. However, if we want to increase them, we have to go to the voters and ask them for an increase.

Kim:

Correct. So and that that's the result of the Tabor amendment that we talked about, article ten, section 20 of the Colorado Constitution has to do with government revenues.

And Tabor is called the taxpayer's Bill of Rights. Was passed in I think, 1993. And, its purpose is to to decrease, government spending and government revenues. So every time you don't, don't use your revenues or you, reduce them, you can't go back up as Jason said. So about 12 years ago we had a we had my office had a case where we asked the Supreme Court, can we do a refund?

And if we have too much money, can we just refund it? And rather than writing a check, can we just the next year do a temporary mill levy reduction that returns that money and then the following year go back up and they said, yeah, that's great. So that's what we've been doing ever since. Now this year, the legislature is trying to encourage all districts to do massive temporary mill levy reductions because we had such an increase in property values.

I've a couple of districts in Vail where the houses are 11, $15 million, and they went up 90% in value in one year. So so the legislature is saying, you know, you don't need all this money. We want you to do this. And we haven't been able to figure out the statute yet that they created what exactly it means, because it's 58 pages of difficult reading.

So that's what I was referring to when I said, well, we'll have it figured out by October. Hopefully. On the left column of the next page, you have the reference to the budget, which Phyllis will talk about the current budget with you. That budget process will begin in August, when the county assessor will tell you what the value of all of the properties in the district is estimated to be.

And then we'll use that number to start coming up with the calculations of your revenues. The next page talks about Tabor. I am not going to start into that now because we'll be talking about it a lot, as you can already tell. And it's it's very confusing. But on the far right column at the top it says E enterprise exemption, one of the provisions of Tabor.

So Tabor ratchets down revenues, ratchets down mill levies. It it it reduces government spending by reducing government revenues as much as possible. But there is an exemption in Tabor for something called an enterprise. And the definition of an enterprise is a government owned business. We've done lots of litigation on the heck does that mean? But it is very clear that water service and sewer service is a government owned business.

I think of it as I'm selling you something and you're buying it. That's a government owned business, and those revenues are exempted. So our fees, rates, tolls and charges, we can move up and down without being confined by Tabor. So it's a good thing, if your taxes go away because you have these government owned businesses, we can we can adjust the revenues.

And I think Phyllis will maybe tell you that she accounts for those separately. So you have the district, which is supported by the taxes that are subject to Tabor, but it doesn't cost much to run it because you have an enterprise called the Water Activity Enterprise, and you have a sewer activity enterprise, and those are run by the fees.

If they get in trouble, we can only use 10%, up to 10% of their normal revenue from the district to support them. But again, Phyllis can do the magic on keeping them going by not having to take money from the district tax funds. Next page, chapter ten public financing. I don't think we'll be talking about that for a long time, but that's just basically bonds.

And there's some other ways if we need to do something, we have the ability to go out into the public finance markets. Next page, chapter 11 audits. We have to do an audit annually unless the revenues are less than $750,000. And Phyllis is going to talk to you about that a lot. Next page chapter 12 contracting. Suffice it to say that there are a lot of provisions that we have to put into contracts, that you will you'll see, and I'll point them out to you when the time comes.

If we do some, some contracting, some of them have been put in by contractors lobbying to make sure that they don't have, you know, when we when we pay them, sometimes we withhold money called retainage, and they want to keep that to a minimum. They want that money as fast as possible. So they go lobby. Now we have to put something in our contract.

And so there's a lot of that that goes on. But you don't need to know about it yet. The next page, bottom left item C intergovernmental agreements. You will see a bunch of those real quick. If you've been following the district, we just entered into the storm water intergovernmental agreement with the city, and then we did the Parks and Rec intergovernmental agreement with the city.

Under the Constitution, we're authorized to enter into contracts with other governments as long as we both have the power to do this thing, the authority to do the thing that we're contracting about. And it's a great way to develop, economies of scale. And as you've seen, this is working out. We think it's going to work out great for us, quite certain.

James:

Quick question. Yeah. when we have one of these intergovernmental agreements like we're doing with the town currently, how does that work with, you know, fees that we collect on water and sewer and now we have a mill levy that used to be associated with paying for maintenance of the parks and things like that. And now we transfer that responsibility and we were paying money.

But is there a point in there where, those mills are treated differently because now it's a district type thing versus a special district. You like the town versus especially.

Kim:

Yeah, yeah. And I get your question. It's a it's a very good question. In the parks, IGA, because the city does not have a source of revenue to take care of the parks.

The IGA the best way to think of it is that we are at the moment contracting with the city to do everything. So it's like a, you're going to mow the lawn, you're going to have water, you're going to fertilize, you're going to do everything. You're going to pick up the dog poop bags, you're going to do all of that.

We're not going to do anything, but we're going to pay you to do that work for us. So that's the way that's the state we are currently in. Also in the intergovernmental agreement is their agreement that this November they will go to an election required by Tabor to increase their fees or their taxes so that they'll have the money that we're now giving them.

And then at that point, I think we have like 45 days, we'll actually convey all the parks to them, the real property, and they'll have the money to take care of them. We'll drop our mill levy and we're done. So we will actually become at the moment, technically, it's not a city function. You have the Parks and Rec.

You're just paying them to do everything. Take care of it all for you.

James:

Okay. Let me just follow up again. So we currently have a certain number of mills that are associated with, you know, what we do here? And, you know, the property values, as you just discussed, have gone up tremendously. Will the mills get adjusted up to the dollar amount or?

Kim:

That's up to you.

Kames:

I'm just them because we're transferring that to the city. How does that get managed? Should we know we pay currently? Are they going to adjust it higher for what they think it's going to cost them and what have you?

Kim:

Yeah, I believe Nathan, does our IGA have a specific mill number? Yeah.

Nathan:

So there's no mill requirement for the city because we can't tell them what to collect. Yeah. So the city, has given me basically every indication, I think what they're going to ask for, if I remember, is 12 mills. our current authorized mill levy is 19. No, the authorized is 19. The road. Yeah. Right. Yeah. So our our current authorized mill levy is 19.

The city is going to go out and get a mill levy, following all current indications to get one for 12. When that happens, what we will likely be doing is for permanently reducing our mill levy from 19 to 7. The reason that we want to hold that seven mills is that's the number that became vitally critical, in doing a, an inclusion with Parker.

And so we want to make sure that we maintain that ability to take seven. We won't collect seven. We're just need to reduce our author or permanently reduce our authorization to seven mills. Then from that permanently reduced seven, we will have to do a temporary reduction, probably down to the neighborhood of about three mills. And so with that, three mills covers, one.

That's the the maximum amount that we it's below the maximum amount that we can take without getting into trouble with that 10% of our income source coming through collected taxes. That will all of that kind of will basically cover, like the general operating costs that it takes to run both the water and wastewater fund. And so those are like customer service representatives, audits, all of the accounting, all of that stuff can pull from there, as well as like administrative fees.

That's where you guys get your, your payment out of. I think the majority of Kim's contract comes out of there, and there's kind of a split that we do in terms of different percentages. And so that will get reduced. I can't remember what the Ultimate Collection will be. On average, I think it was around like $800,000 total collected through that, like three mill levy.

Kim:

And .... And I think I heard one other question in that question. And the if I understood the question, you're saying because of the increases in property values, that 12 mills is going to be a lot more money. And I think, just before they go to election or as we're getting our budget together, we'll have to have that conversation with the city, because we have I have to look.

But did we pledge to them the 12 mills or or.

Nathan:

Yeah. So we yeah, we pledge to it's the yeah. It's based on. Yeah. Yeah it's based on the mill levy and then there's estimated dollars put in there. But yeah we did pledge the 12 that we receive. Yeah. So well above the 15 that we receive. Yeah.

Kim:

We'll have to have a conversation with them about that to see if, if that mill levy should be less because they don't need those dollars, they have an incentive to that.

As we do that, if they can lower that mill levy need when they go to an election, it's going to be a lot easier. You know, if they go and ask for 12 under this current situation, it's going to be much more difficult to get it. So you'll be part of I think that exact conversation soon.

Board Member Director Jana Krell:

And what is the number 15?

Because Jason said that the use of 12 to 15. Yeah.

Nathan:

So it's the difference. So it's the difference between what we actually collect and what we're authorized to collect. It's not exactly 15. It's 15 point something. Something is what we slightly more than 15 mills is what we are actually allowed is what we're is what we're. So 19th what we're allowed 19 is what we're authorized.

Jason:

Yeah. We've been collecting 15.

Nathan:

Yeah. So 19 is what we're to create. And I think we've got to mic live.

Jana:

I wrote down 19 it is authorized. Yeah.

Nathan:

So 19 is authorized. That's the amount that we can collect. We have voluntarily reduced our collection to a little bit above 15. Okay.

Jason:

And then of that 15 we're estimating that 12 of that is what that actually took us to run the parks.

So we that's where we're gonna keep the seven and only collect 3. Okay.

Jana:

And that's seven number like a marker

James:

I'm sorry. That's kind of what I was looking for is. Yeah that is the simple math where we have a dollar amount and we have Mills. What's the conversion? And then going forward with the increase in property taxes, that's essentially guaranteed to happen at this point due to property values increasing.

What was the city's position? What was our position? And where's that balance point between what we take going forward and what the city is planning? I guess proposing to the taxpayers and just trying to understand that simple math.

Kim:

Yeah. And that was the breakdown. But as you note, you know, that's going to turn into a lot more dollars now.

So we'll have a conversation, whether it's a pro-rata reduction or I don't know what it'll end up being, but it it needs to be discussed. Good questions. Chapter 13 liability issues. Again, keep it short here. You are protected by the Colorado Governmental Immunity Act. The district is protected back in England when this whole our whole legal system started, you had a king, and the king was sovereign.

And the king could do no wrong. And you couldn't sue him. And and that actually carried over here. And the government was immune from any kind of action. And then, states and the federal government started adopting these immunity acts that say, well, you know, you can't sue us for this, but you can do for this. And and it kind of broke things out a little separately.

You as a government are protected by that act. And you as individual government officials are also protected. You also have, bonds covering you for the district and insurance coverage. And we also have and I'll put this in the packet for managers. You can see it in indemnification resolution. So if something goes wrong and you get sued in your name, the district will take care of that.

They'll take care of the attorney's, all of that. So that in the interim you don't have any issues. And that's all that's perfectly legal and sanctioned.

Nathan:

Yeah. Along those lines, I think. One, quick note, and Kim can correct me if I'm wrong. So in terms of, like, the positions that the board hires at the district, you really are responsible for two selections.

One is my position is district manager, the second one is our attorney. So Kim works directly for the board of directors, not for me. So he's. When I talk. When we talk, when we talk about, like, staff reporting to me and me reporting to you, Kim is the exception to that. Yep.

James:

Okay. And, just because I was on charter commission, you're the only one that can give direction to staff, correct?

Kim:

Yeah. And yeah, that that's not written into the law for special districts. But believe me, you don't want to go there. No, I I'm perfectly fine. And I think that's appropriate. I was just more saying it for the group because we, we codified that when we created the charter for the town. And I just assumed it was the same relationship.

But it's not in a bylaw. Yeah. Because I definitely don't want to get between you and the other employees at a district. That's just a bad situation.

Kim:

So yeah, just there's there's no way to win.

James:

I will I will ask one question about that though. because it came up in charter is if you're unavailable, for whatever reason, who do we call and how do you make that notification?

Or is there a direct person that we know ahead of time that we discuss that kind of stuff with?

Nathan:

You're 100% out of luck? no. Yeah. I think those are some things that we can I can do a better job of clearly defining, generally speaking, just based on what we have going on in the district. If I'm not around, I just kind of pick somebody that's, more than likely the one that would be to go to.

Generally speaking, it's going to be one of two people. It'll either be Susan, our office operations manager, or Will Parker, who is our, operations or like our utility operations manager. Will will be here at the board meeting on Monday night to make an introduction to you guys. So you get some face time, and go down that route.

And I think one other thing that we that we have discussed, that there's definitely going to be worth taking a look at, probably better sooner the later is actually going through and looking at those types of things like our board rules and regulations are our board manual, is pretty woefully outdated. Kim was able to to find a version of a bit going through and like redefining it and more directly addressing those kinds of things would be helpful.

Which is why I kind of stuttered around the board. Can the board give it for direction directly to the staff? I guess, like technically we just don't have it, like written down and really clearly defined. And so that's one thing that we'll probably be looking at in the next few months is getting those updated.

James:

Okay. Appreciate it.

Kim:

Thanks. that's probably enough. On chapter 14, personnel matters, 15 deals with elections. The only thing I want to say about that one is there are two kinds of elections. One is for your your revenues, your taxes, the Tabor election, and the other is for the board seats. And you guys have been through that recently. And that that election was actually run by the district.

There's two kinds of elections. One where you contract with the county, clerk to do most of the work on the election, and the other one where you run it yourself. Since I've been here, we've had, I guess, 2 or 3 elections, but we've run them all ourselves, which is an interesting process. And you'll get to to see that eventually, because it will happen.

A couple more pages. At the right hand side, there's item 15,16,17 J says campaigning with regard to elections. You. Once we start into an election process, the Colorado Fair Campaign Practices Act precludes you from participating in those elections in your capacity, the district can't do anything. Individually, you can volunteer time and do things, but not under your director name.

Not using any district finances, even when it's our own election. So we by the time we get to the election, we try to make sure we've done all of our campaigning before. The Fair Campaign Practice Act cuts us off, and you'll see that in process, too. It's kind of fun. If you flip past the chart on the next page, we have chapter 16 dissolution that you don't need to think about now.

But again, if we get rid of our water and sewer services at some point, we're going to be going through that process as well. And that's it. Like I said, there's a lot of information in there. If you have questions, let me know. You don't need to read it. That's what I'm here for is to every time something comes up, we'll address it.

Part of the the art of all of these things is you have to be around long enough to recognize these issues, because we could talk about Tabor all night long, and five minutes later, you can be smacked right in the face with the Tabor issue, and you won't recognize it until you've experienced it. So it's kind of fun, too.

Great learning process. And you learn to think like a legislator and and maybe a lawyer and you will learn.

Jason:

Thank you. Kim, you may have any other questions for Kim before we close out the section?

James:

No. I'm good.

Jason:

Okay. Thanks. All right. We'll be moving on then to, Castle Pines North Metro District Finance is 101 with Phyllis and Sadie.

Phyllis, Sadie, are you with us?

Phyllis Brown, Director of Finance and Accounting Community Resource Services of Colorado (CRS):

We are. Good evening. Hello. to unmute. Hello. Can, Yep. Can you hear me?

Jason:

We can hear you.

Sadie Whitworth, Accountant, Community Resource Services of Colorado (CRS):

I'm here. Can you hear and see me as well? Yes. Thank you.

Phyllis:

Okay. Well, we're not going to give you as detailed a presentation, and we don't have a 15 chapter book to give you, but we're.

But tonight we're going to present you with just some of the overview of the finance and accounting. and if you have any questions, during my presentation, just let me know and we'll stop and talk about those. and I don't know if you got a copy of our study session agenda. We do. Oh, good. Yeah. Okay, good.

Sadie:

Thank you Nathan.

Phyllis:

Okay, so first of all, introduce our us again. I know I saw you briefly at the last board meeting. Phyllis Brown from CRS of Colorado, and that's Sadie Whitworth, who's one of the accountant, the main accountant working on, all the records and books. And I'm the director of finance and accounting, and I'm primarily responsible, and I'm responsible for the review and the audit and, making sure everything gets done.

Susan is in the office working on payables, and she keeps everything running. Makes our job easier. So we appreciate everything she does and the receivables and how hard she does. So the billing, and all the payables, the receivables are all done, through Castle Pines. Susan. And then Jackie's helping, and we take everything from that point on, and take care of the accounting records and financials and information for the board packets from the audit.

So, everything else, and CRS took over, in June, I think it was June of 22 after pinnacle, left and and we took over as the outsourced accounting person people. so the overview and current status that there's three people in the district office and we have four CRS staff, two that are helping with the billing, and we're also helping before Jackie came on board helping in the office.

And Susan is very knowledgeable and been there 20, ten years. And I listened to Kim and I like we're still we're still learning. So so the accountants are babies like you guys are on the board. But boy, we learned a lot. So you guys are learn a lot over the next few months, I think. The board gets a financial packet each meeting and that, if you remember, includes our claims.

And it includes, financials. It will include where we are for property tax collections and then what we're handing off right now, right to the city of Castle Pines. In fact, I just made the monthly payment, today, and so when the payment comes in, we send it right out to the city of Castle Pines and notify them that they're getting that.

We're also, tracking the water and sewer connection fees. Tell us, so we could show you how that varies from month to month and year to year. So usage accounts receivable, cash, and whatever other information you guys request. So if there's additional information that you guys are wanting to see, we could also we could just tweak that and add, additional information.

So as you get going and you say, hey, would be nice to see this, we can work with, Kim and Nathan to come up with what would be, useful for you guys, the billing system and the general ledger software system. We were having a few issues a few months ago, but that's all been updated, and I think everything's going smoothly on the billing side, and we're, able to get some more information, I think, on a financial edge.

That's what the software is. So the current priority for the district is I think you guys know that the 2021 audit is not yet complete. When pinnacle left, the audit was not complete. We'd lost the ability to schedule the the auditor, at the time. And we were new and learning the, so I can't believe it's already June of 23.

But today we did have a meeting with the auditor to, I think we got our final adjustment for the 2021 audit nailed down. And so he says he's going to be able to provide us a draft of the 2021 audit report next week. So that's good news because we can't really start the 2022 audit until we get that one done.

So Sadie is working pretty much full time trying to stay ahead of the curve. We're doing the accounting for 23. We're looking back to the 22 and trying those numbers up and trying to finish 21 all the same time. So kind of the first time I've had to work on three years at the same time.

Jason:

Phyllis will, when will the 22 be, done?

Will it take a month? We'll take another year. How long does that take? You think

Phyllis:

It will not take a year? I won't, you know. I do not want to wait another year. And so I need a nail. I need a nail. Rubin Brown's been engaged again for 22. And they've been doing the audit since 2017 or 18.

Yeah. For the and so they are familiar with what's going on. But since you know, since we've had a lot of changes, you know, the, the IGA, the, assets moving, you know, the inclusion was supposed to happen. It didn't happen. So we did a budget amendment and then we had a, you know, that we change that.

There's been a lot of moving pieces. So I think as with things settling down, and us knowing more and being able to we'll be a lot quicker. So I'm going to pin him down on a date. And then once we get that date, I'll let you know. You know, the goal we can extend. Well, you you're allowed to extend your audit from July 30th 1st to September 30th.

Like a tax, like your taxes, you can automatically extend it till September 30th. because we filed late for 2021, you don't get an automatic extension for the next year. The penalty? There's no monetary penalty for filing your audit late. They the county can withhold your taxes until you file the audit. Amazingly enough, they've been sending it to us.

So, so the city of Castle Pines would be the one that, you know, would need it. The district can operate without that tax revenue at this point, but we want to get this caught up so that we're getting those payments.

So once we file 21, they should. If they cut us off, we would be back getting our taxes and they wouldn't hold us again unless we filed super late for 22, which is not going to happen. So once we get that audit draft, we'll, we'll review it. We'll legal we'll review it. I'll have Nathan review it before it goes to the board packet, so that when it gets to the board packet, it's substantially complete, subject to any kind of additional changes by legal or any other questions that you guys might have.

So you'll get that draft with your board packet in the July meeting. Does that make sense? And then once we once we do that, they'll ask the auditor will ask management to sign a management representation letter. And then once once they once they sign that, then we're going to be able to file, get the audit opinion and file that with the Office of State Auditor.

So that's what the auditor and CRS's responsibilities are for that. Any questions on that.

James:

Yeah. It's going to be a combo question. Probably with Kim. So I think I heard, you know, you got left in a bad place by the previous, accounting firm, and you're going to have probably within a week or a few weeks, call it, the 2021 complete correct?

Phyllis:

Correct. All right. And that's going to the draft. The draft done. It won't be finalized. So we have the July meeting and it gets accepted by the board.

James:

Okay. And we have this IGA in place that we're now providing money back to the city. And it's a dollar amount that, you know, we've agreed upon to supply. But I'm starting to get concerned about the date stacking up.

If we're going to an election and the city has to set mills, for what they think they need going forward, it would seem to me that we want 2022 fairly quickly so that we can inform the city, as well as ourselves, about what the real numbers are for the last full year that we had as far as maintenance and running the district and things like that.

Does that sound right? Okay. Right. And do the dates, the dates that you currently have planned out right now, support that decision making in that ability to properly inform both, this group as well as the city itself. And I just want to understand if we're looking at that. Yep. Yep. Okay. Go ahead. Is that something that you can kind of put on a piece of paper maybe next next time we we kind of talk at the next meeting.

Just a quick couple lines on a sheet of paper that says, you know, here's a day, here's the date, here's the date. And and just so it's clear, because we are bouncing around talking about a lot of dates and a lot of moving parts. And I just wanted to get an understanding from you explicitly what those dates are and whether or not, those accounting dates and that information is going to be available to support decision making.

Phyllis:

Right. There are a lot of pieces, you know, on one part of it is how much we're spending on the Parks and Rec. And then in addition, Castle Pines, the City of Castle Pines, would also be now incurring their expenses. So they'll have an idea of what they're, what they're spending and what they want, for their mill levy to be.

And again, some of these dates, I'm jumping ahead, but we'll get the preliminary assessed valuation in August. Right. And we could start doing a draft budget at that time. We won't get the final assessed valuation until December. And we file the mill levy December 15th. So we have all the way till December 15th to, decide what that levy looks like.

So I don't think we're going to have a problem date wise or in our timeline, but there are a lot of a lot of pieces going on, you know, and then the discussion does have to be early on how many mills the city is going to get. It's also predicated on what whether they can even get that through an election.

Because that may change that outcome as well. Am I saying that correctly? Kim. Yes, yes.

Nathan:

Yeah. And so a lot hinges on the city's ability to get that mill levy passed in November. And then the other side of this is that the IGA, does have, some language in there that allows, once we theoretically move on to like the final execution of that contract and we're closing it, that's when we're going to be doing like all of the final accounting to to make sure all the correct dollar amounts have been transferred back and forth.

The city also, we're we're definitely a large portion of the, the money that they need to project, but they also have the several other districts that are going to be included in this, the mill levy that they're asking for a as I understand it, is going to be citywide to replace a bunch of stuff. So they're looking at a, a large number of numbers outside of ours to.

And so, it's something we're all paying attention to. I think you're, you're right on track with your point that we just need to make sure that we're staying dialed and getting information pulled together as quickly as possible. One other thing that's been great so far about the relationship and that conversation that we've been having with the city is it's been very amicable.

I think everybody's working toward the same goal. And so as long as we kind of keep that momentum going and just stay in those active conversations, I think we'll I think we'll be okay. but yeah, I appreciate the, the perspective and kind of giving us some stuff to make sure we're paying close attention to.

James:

Okay. thank you for that.

Appreciate it.

Phyllis:

Does that answer does that answer your question?

James:

Yeah. I just want to reiterate the the desire to get that timeline, you know, just a quick email or something like that, I think is all we need. Is that something you can have as part of the financial packet in the next couple of days? Phyllis?

Nathan:

I can always send it out or something separately.

Phyllis:

Yeah. yeah, I think so, because really, you know, a lot of that I was going to talk about with the, the compliance calendar for, so some of those dates are set and some of those dates are going to depend on the city, to be able to do. But, you know, getting our budget, preliminary budget done.

And when the, when the budgets needs to be delivered to the, to the board because that date is October 15th, that the board gets a copy of that budget, and it's not voted on or approved at the time. But that's one of the state statute requirements. And so there's plenty of opportunity to be looking at those numbers and updating them along the way.

Castle Pines Park is getting easier. The city of Castle Point is getting harder. But, you know, having having that gone where we're operating an enterprise. And so we'll be able to, budget our numbers, I think, with a fairly closely and be able to figure out what we need and what we can collect, in order to stay in compliance with Tabor.

James:

Okay. thank you again. Appreciate it.

Phyllis:

Okay. And then just to point out that, like I said, we're we're working on 23. So we're trying to keep updated as we go. So once we can finalize one year, we'll be giving you more robust reporting that will include financial statements and your budget to actual and some better numbers as we go forward.

So, Kim touched on your revenue sources, so I won't go over that too much. But just so you know, we we do have those different funds. And one of the things we'll be doing in the budget is we've had a general fund in the prior year, which primarily included the Parks and Rec and also some administrative costs of the district.

And so one of the thoughts is to be able to say that, do we need that general fund will be because now we won't have the Parks and Rec. We will allocate our district costs across the funds. We have the wastewater, the water, and then also we have some left in our storm drainage fund that will also go away.

Since that, is now part of the city under a the separate IGA for that. So we get capital improvement fees we get for our capital water connection fees when people are are new to the district, some of that and some those funds are going to our capital expenditures. We also have and when you when you see the audit, you'll see what we have in capital improvements.

And what we have is designated for capital improvements. How much is operating? And we do separate the water wastewater and the water charges. So they go into the separate funds. So we'll be showing you all that. So I did I did talk about and here's some of the dates that you might be asking for the August 25th, the preliminary assessments October 15th, your statutory deadline for the proposed December 10th.

They have to finalize the assessed value. So December 15th is your certification and the mill levy after that's done somewhere in there, the board's going to receive the budget and finalize the budget. And a lot of times that's finalized before the mill levy date, certification date, because who's going to be sort of who's going to be certifying or adopting their budget Christmas week?

I mean, timing isn't very, very good. So you'll you'll do your budget approval subject to any change in the final mill levy. And then then you have till January 31st to actually file that with the Department of Local Affairs. DOLA. And the other monkey wrench in here that Kim, I don't know, Kim can talk about is whether there's going to an election to see about changing the rates and the resident so that could affect the mill levy, calculation?

Is that correct? Kim.

Kim:

Yes. And I've already and we won't know that till November. Right. I advise the county I think two days ago to that I don't say reason. We're going to be going to an election for anything in November. Is that true? Okay, good.

Phyllis:

Okay. But it could change the way that we're assessed at some point.

And our mill levy.

Kim:

Yes. So yeah, that's that's a new statute that we'll have figured out eventually.

Phyllis:

Eventually. Yeah. A little more complicated than it's been. And Kim's been doing this a lot longer than I have, but it sounds, good thing we have a good attorney to help us do that stuff, because I'm a good accountant.

But I'm not going to say I'm a expert on Tabor or making sure that's done. And you can't really mess mill Levy up, because if you mess that up, you're out of luck.

Nathan:

And then Phyllis another way. We'll also have a president talking about Mill Levy. We'll also have a presentation from, a joint president. It well, kind of a joint presentation from the city of Castle Pines and, South Metro fire.

You guys saw the email it sent out about, urban blight district that they're putting together? They were able to delay the deadline that they had given us so that we can actually address it as a board. And so the city is going to come present on why they're doing it and what it does, how it impacts the mill levy.

And then South Metro Fire is here to have a kind of further that conversation more around like, do we want to have a member of our board sit as part of that council that's on that district. And so we'll get more information on that. That will also have an impact on mill levies for any district within the boundaries of the blighted district.

So one of the things that we talked about was, that difference, you know, the mill levy value increases. So the same mills bring in much more money as I understand it. Basically what this does, what this area does is capture any of that excess. So it'll effectively stick us, at whatever we collect this year. And then any increase on those same mills would be transferred over into that district, but they'll be able to give you a lot more detailed information and correct any missteps that I've had.

But that'll happen Monday. Something else to muddy the water for you. So.

Phyllis:

Okay. so I don't know if you want more specific due dates than that for the meeting Monday night. As far as what do we think we're going to file the audits or what else you're looking for, you can let me know.

Nathan:

Yeah. Phyllis and also, the directors, I guess the question I was, have I can I can kind of go through before that meeting and include in my report just a, like a general like overview of all of the timeline.

So not only the required dates that we have, but some of the projected dates across like a bunch of different things that we're doing. Just to kind of be able to see that for the rest of the year is more of like a comprehensive picture, rather than just specifically related to like those individual topics, topics, if that would be helpful.

I can just do kind of a much broader, scope with a lot of those incorporated dates to kind of just get a feel for how the the board may be moving through the next. The remainder of the year. I guess

Jason:

That'd be great.

Phyllis:

Okay, so we've already kind of talked about the audit and why we have to do the audit. The board has the authority to select the auditor each year. So at the usually at the end of the year, will present if you guys want to get to go out to have more proposals for a different auditor, we could do that.

If you're if you're happy with the current auditor, they could provide us with their proposed engagement letter and then that would get accepted. or voted on so that we could, get everything ready so we could start that next year Audit. So that's done annually. The selection of the auditor. And, what else I haven't said.

So we're preparing all the numbers and the information and all the schedules so that we can hand that packet over to, the auditor through their portal so that we can. So they could they can audit the numbers. And I think some of what happened was, the Pinnacle hadn't completed all that. and then so we, we jumped in in the middle of the audit with, you know, these 50 requests from the auditor.

So it took a while to get our arms around it. And one of the biggest pieces I had completed was all the capital asset, information and ads and there was a lot of construction in progress. There's a lot of assets. And Nathan was instrumental in helping us sort through all that, because he has a good history with the district, and we were able to get that sorted out and I think cleaned up pretty, fairly well.

And so that that may change, you know, if we're holding the assets for the Parks and Rec at some point the city would take those over. And that would be another piece that we would have to disclose in the audit. And then at the end of the audit, I told you, they're going to tell you, they're going to provide you with a, required communication letter.

And that's a standard require for an auditor. That would and some of you may have already seen it, if you're sitting on on the board, let's say here's what we did here. Here's what we our responsibilities were under generally accepted accounting standards. And here's our other findings and other matters which would include, did they have any difficulty difficulties where there are a lot of adjustments, and how the audit went.

So they'll be giving that to you and once the audit is finalized. And so we'll make sure you get that letter. So if you want me to, I can kind of go through who's responsibility who does what with for the district. And Susan and Jackie, I told you already Susan's doing the overall daily administration and the office.

They answer all the phone calls. Her and Jackie. Someone's calling, asking for questions. Someone needs new service. Someone has to shut off. We have tapped these, trying to collect on accounts receivable, making sure people get paid. I always say that's the hardest job of all this thing. You know, we could do the accounting and we could do everything else.

But making sure the bills get paid is a difficult job and making sure it's done correctly and on time. So Susan does a great job of that. And then they also we have our two people from CRS who at the end of the month, they're going through credit card reconciliations and finalizing, everything in the billing system so that they could get the bills out and get those printouts.

So that's quite a process. And they had to upgrade the system because they were having so much trouble. But I think it's going smoothly right now. And I already kind of talked about what we did. We're making sure we've got the cash updated, accounting input. Susan's putting everything in the general ledger for the payables, and then we're posting it through the general ledger, maintaining the general ledger, closing the month, processing payroll.

Tracking taxes, tracking receivables, and then preparing all the reconciliations, helping with the budget, the budget. It is really a team effort between, the district employees and Nathan and and us and legal. And then just coordinating and working on any other projects that the board or Nathan asks us to do as needed.

And I think you have a state that I think hopefully the the copy, the compliance calendar for you.

Kim:

They have it.

Phyllis:

Or no. Okay. Good. And then, you know, and I don't know if you had a chance to look at the 2020 audit, but like I said, you'll be getting the 2021 audit and then the budget. I don't know if you guys have taken a look at the budget.

It includes a mill levy. It includes a budget message. And it also includes the amounts budgeted for the year as well as, what last year estimated was what we were estimating for 2021, estimating for 2022, and adopted for 2023. So looking at the budget kind of gives you a good history to compare, although a lot of it won't be comparable since we're now, you know, taking away some of these, this information, there was debt that was, paid off.

So, so that the debt is substantially nothing. There's one loan left with Chase Bank, I believe. So that fund went away and then the storm drainage fund will go away as well this next year and perhaps the general fund. So it'll be a simpler budget if we have just the two enterprise funds.

Jason:

Wow, thank you Phyllis.

Phyllis:

No problem any other questions on that?

Jason:

Does the board

Have any other questions for Phyllis? Phyllis, I think we're good. Thank you very much for what you and your team do for us. We, don't know how we would survive without you. So thank you. And, and I think we can conclude this portion of the study session. So thanks again, Phyllis. Thank you.

Nathan, did you have anything to add?

Nathan:

No, I don't have anything specific, I guess, one more piece of, color. I know, Jason, I have exchanged a couple, like, awesome looks about the server stuff. So, just for some, like, quick data points when we processed billing prior to changing out the servers and, using moving a few different softwares around.

Actually, just like processing the data used to take us about 8 to 10 hours of, like, dragging over small file bits that this thing could handle. And it really ground out. And then it usually took us about four days to get it, sometimes five days to get through that whole, like, get the bills printed, produced and ready to go.

And that was usually like 3 or 4 employees. So the file that used to take 8 or 10 hours to go takes us about 45 minutes to do, and we can do our entire billing process in about a day or a day and a half with two employees instead of 3 or 4. So that server, server upgrade, along with some, software stuff that we did earlier this year has been massively helpful.

Wonderful. Yeah. But other than that, I don't really have anything else. I do, so I have a couple notes that I took, things that we'll get to the board I'll try and include as comprehensive of a timeline, as I can. if you guys would like, I can also send you copies of the most recent budget.

Just so you have it. It's also available on, on the website, but you can kind of just see where we're at. and. Yeah. Is there anything else that you would like to have had covered that we can bring into another study sessions? Question you guys have for me?

Jana:

Thoughts on scheduling a site visit for all of us to check out pump station, lift stations, infrastructure stuff.

Nathan:

Yep. So I have that, it's actually written on my to do list here. I've got to finish up my board report for you guys. I'll get that done, most likely tomorrow afternoon. and I'll include kind of that information in there. Next step. We'll get that going, and then we can confirm the dates at the meeting on Monday.

Jana:

And then is there other training or items you want us to be privy to or review early on in this process?

Nathan:

I made a couple of notes for some document. I'll get you, one digital copies of this. I need to get them sent over to, Leah. Who else we're missing? Leah and Tera, as well, in terms of upcoming trainings.

So the study session for July, that'll be when I kind of do, like a history of the district, kind of where we got where we are, what our overall kind of priorities are and what we're really pushing on next. You got a lot of that with, finances as well. And then the other half of that, we're going to have Austin Hamre, who is our water rights attorney,

come in and basically do what Kim did for board meetings. As it relates to, just kind of generally how water rights. Look, I'll give you a good overview of what our water rights portfolio currently looks like. And then he's also going to have some, some information for you, specifically relating actually to mineral rights, and property that we own.

Farms that we had purchased for the water rights that have now been sold. We still own that land in that property, and we need to figure out what we want to do with the mineral rights as well as a contract to I think is with the I can't remember the name of the agency off the top of my head, but we also have a contract that allows that helps us with the water

Accounting is basically the state agency that does all the water accounting to make sure that those water rights are going to their own specific stuff. Austin can explain it much better than I do. But we had originally assumed that that was a contract we would just let go of. Austin did some digging on it, and it turns out it's actually an assignable contract that would probably be worth selling.

And so we're going to have to kind of do a bunch of stuff around that. And so that'll be next month. And then, Monday we'll be able to confirm, facility tours, stuff like that. And I think that's all I had scheduled for, kind of my board orientation stuff, unless there's something specific you were hoping to see.

James:

I just had a question that we talked about a lot of things, sort of from an accounting perspective and what the history of things were, but prospectively, do you have a list? Maybe that's going to be July and you're going to go through that, but prospectively looking forward, what are the plans, you know, going forward?

And what projects are getting worked in? When is that something that you have on a calendar or schedule?

Nathan:

Yeah. And so I've got a, a bunch of different schedules, but so that's kind of what I want to do with the calendar. that I'll bring is like include all of that stuff. So including I'm looking at the capital projects that we're doing, you know, like next steps beyond the audit.

So I think we briefly mentioned talking about, like, doing a rate and fee study. All of the information that we're working on to kind of get that thing in place and ready to go, I don't know if we'll be able to do that, prior to the budgeting season this year. So that's something we'll have to talk about is like when is appropriate, when we can we fit that in.

There's a ton of information we're gathering, to support that. So I can I can include all of that in just kind of a general overview. You'll probably get like, I call it like a c-plus version of it on Monday's meeting, and then I'll really have it dialed in for the presentation at the following starting session with a lot more information, kind of, just because I'll have more information another month out to I'll know a lot of things I don't currently.

James:

Okay. And, will those projects also have like, dollar amounts associated with them, like contractual or can we not do that here?

Nathan:

So yeah, we will have the answer is both. So there's, current projects going on that are have gone fully out to bid that the board has accepted the contracts on those dollar amounts are, generally known, barring, you know, RFIs or any TNM stuff that comes up.

And then we do have, our engineering firm has our project estimates, in terms of like, this is what we think they're going to cost roughly before we send them out to bid. And so we have all of that information and a timeline. Basically on the capital side, we're projected through,

To some extent, we've got projected capital expenses all the way through 2024, 2025. With kind of a general overview specifically looking at like the live station rehabilitation program. On the water, on the water side, we have a lot more firm time, timelines and dates with when we we're expecting projects to start fire off and move forward.

And then there's a few capital projects that have, honestly, they just have moving and moving possible dates and those are, distribution system upgrades and replacement. So we have areas that we know we need to replace water line in. What moves those calendar dates around is that we're working with the city to capture as much savings as we can.

If we have to replace a water line in a street that they're ripping up, like, let's, let's partner and get those projects done. But those are kind of move around driven both by, you know, if we have a water line that completely comes apart at the seams and it's breaking all over the place, the city's committed to work with us to readjust their street paving, paving schedule, to kind of move over with us.

And then the other side of that is also true. If they have a street that just deteriorates really rapidly, we may move a project over. And the way that we're handling that is we're basically designing all of it now, so we know which ones we absolutely need to do, and then we've got the designs in hand.

So whenever those projects fire off, we'll be able to go and we'll we'll account for that in budgetary numbers as well. That's that specific project. The water distribution program is much, much younger. It kind of came up, just within the last couple of months. So we don't have fantastic budget numbers on those yet, but we'll keep updating it as we move forward, especially when we go into budget season, which for me kicks off really right now is when we I started looking much harder at that so that when August comes around, we're ready to roll and then we can hit the October 15th deadline for presentation to you guys.

James:

Okay. thank you very much. And, so we'll see that you said, is a c-plus version of that kind of next week.

Nathan:

Yeah. I'll include it in the board packet as part of my report. All right.

James:

Thank you very much. Absolutely.

Jason:

A lot of great info tonight. Thank you guys for everything and great questions. if there's nothing else, I think, we're running a little ahead of schedule, but I think we can call this meeting and adjourn it.

Nathan:

Unless you want to go deep into some obscure section of that SDA guidebook. I'm tempted to talk about you URAs, but I'm not going to.

Nathan:

All right, I think we're good. Thanks, guys.

Phyllis:

Thank you. I'll see you guys Monday.

Leah:

Thank you Bye!

James:

Bye Phyllis. See you.