Tuesday, October 18, 2016

San Angelo Citizens Conserved Water as City Council Requested

The City of San Angelo's 2015 annual financial report includes a table on the second to last page showing average daily water use history.  It's pictured above:

The impact of the 47.5% water rate increase in September 2011 can clearly be seen as citizens reduced usage.  Citizens went from using 14 million gallons per day in 2011 to 8.8 million gallons per day in 2015.  That's a 37% drop in average daily water usage, exactly what City Council said it wanted.

Citing a desire to encourage conservation, council decided to generate 75 percent of the revenue needed to make payments by increasing water usage rates by $1.31 per 1,000 gallons and 25 percent of the revenue needed to make payments by increasing the base usage rate by 29 percent. 
Citizens doing what Council wanted "blew a hole" in the water budget.  So City Council hired Raftelis at a cost of $107,000 to make the case for fixing the budget hole.  That resulted in a five year plan where rates will rise another 55%.

Council increased rates again in January 2016 by an initial 11.5% of the planned 55%.  The impact of that increase is yet to be seen.

Sunday, October 16, 2016

San Angelo Water: Two of Eight Samples Had Hexavalent Chromium

The City of San Angelo's water system had 2 out of 8 water samples test positive for hexavalent chromium, the chemical in drinking water that harmed people in Hinkly, California.  The movie Erin Brokovich turned hexavalent chromium into a frightening household word.

San Angelo's two positive samples came in at .035 and .038 parts per billion (ppb).  Although they sound like minuscule amounts the California public health target level is .02 ppb.  The two samples with hexavalent chromium came in at 75 to 90% higher than this goal.    

One other county in our area had five out of eight water samples test positive for hexavalent chromium, Menard County.  The city of Menard's average of .0238 ppb exceeded the .02 public health goal.

The city draws water from Lake Ivie, the Concho River and the Hickory Aquifer.  When the City of San Angelo developed the Hickory Wellfield radioactive radium was the primary concern.  It's not clear the source of hexavalent chromium in the two San Angelo water samples, but that would be interesting to know. 

Saturday, October 15, 2016

City Council to Discuss Hickory Water Well Driller Alsay Again

Alsay Corporation first appeared on the City Council agenda on August 6,2013 when the company was approved to drill six additional wells in the Hickory Aquifer for $7.57 million.  It reappeared this summer and Alsay's been a regular on Council's executive session agenda ever since.  Council has not shared their deliberations from any closed agenda discussions.

San Angelo Live reported operational problems drilling the last Hickory well (in their March 2016 piece).

The last well received delays due to the well driller having operational problems. Now awaiting the well to be completed, the project is estimated to be finished in June or July of this year.  
The City's website states "Six new wells were completed in June 2016." Hints of performance issues reside in the following description from the city's Hickory Aquifer webpage:

  • Wellfield expansion: The total pumping capacity of the wellfield was increased from 6.5 MGD to 10.8 MGD by the drilling and installation of six additional wells and supporting infrastructure. This project was substantially completed in June 2016. This portion of the project was covered under two contracts for a total amount of $17.3 million.
  • Engineering: Close-out documents are being prepared for the wellfield expansion projects. Approximately $15.9 million of the original $19.38 million contract amount has been paid to date.

Roughly $3.4 million of the contract amount has not been paid per the city's website.  The closed session agenda item cites "pending or contemplated litigation."  So far concerns have not surfaced, but maybe they will.

Monday, October 03, 2016

Council to Take Up Development Corporation Items

San Angelo's City Council will consider three items from its Development Corporation in the consent agenda for its October 4, 2016 meeting.

First, the City of San Angelo must spend $2.4 million to make $1.2 million off an Industrial Park land sale.  City Council documents state:

On Wednesday September 28th with a vote of 5-0 the COSADC Board accepted AEP Texas North Company's offer for 52+/- acres of land in Phase 2 of the Industrial Park at a purchase price of $1,196,000 or approximately $23,000 per acre and authorizing the Board President to negotiate and execute a real estate sales contract in substantially the same form as attached.

The proposed sales contract will require that COSADC provide all utilities to the property line and jointly with the buyer address all City of San Angelo storm water requirements to allow development of the property. The preliminary engineer’s cost estimate is approximately $2.4 M to minimally extend Gateway to a new cul de sac, minimally extend utilities to serve the project and provide all storm-water improvements for Phase 2 of the Park.
Second, Council will consider approving the agreement between the city and the development corporation for staff services:

Consider ratifying COSADC's approval of the City of San Angelo Agreement for Provision of Administrative Services for FY 2016 and FY 2017 in the amount of $471,273.59 for FY 2016 and $513,677 for FY 2017
Oddly the agreement never mentions a critical COSADC bylaw requirement, the production of an annual report.  The city's website does not host an annual report from any year for the development corporation.  One exits for 2011.  The 2012 report was given in October 2013.

The city conducted a compliance audit for fiscal year 2013.  That arrived in November 2014 but the city refused to post the document.  However, it is available here.  It paid local accounting firm Armstrong Backus $1,175 for a contract compliance audit.  The COSADC board approved the disbursement in its February 2016 meeting.

There's been no presentation of an annual report or compliance audit since 2014.  In February 2015 City Councilwoman Charlotte Farmer asked the Sales Tax compliance audit be made public, possibly at a future meeting.  

Third, COSADC will recommend to City Council concerns air service marketing.  The Development Corporation approved the hiring of KSA Engineers for up to $63,000 for air service marketing and recruitment services.   KSA's website had this to say about an earlier effort to add an airline at Mathis Field.

Over the past few years, the San Angelo Regional Airport has undergone significant improvements and more are on the way, including efforts to attract additional airline services and major renovations of the terminal. We are currently working to address a number of air service issues, such as the lack of jet service, need for airline choice and passenger frustration over canceled or delayed flights. These issues are prompting some people to drive to their destination or to other cities’ airports, and that is a serious concern for us and the community as a whole.  June 2, 2011
In August 2014 San Angelo Live reported on KSA's involvement in airport service development for nearly $80,000.  That was in the midst of the oil boom. 

Anyone wanting to watch how the Development Corporation handled these items can do so here.  I found it interesting that several items were taken from public presentation to executive session, meaning the public did not get to hear staff recommendations or hear officials questions, concerns or discussion on the items.  We'll see if this is a one time event or becomes a pattern.

Monday, September 26, 2016

Solar Centex to Open in San Angelo

KIDY reported:

Solar CenTex owner Scot Arey plans to open a solar branch in San Angelo.  He says his company can bring around 7,000 jobs to the Concho Valley.
The company's website had San Angelo front and center.   I'm not sure how Solar CenTex will create 7,000 jobs when OE Renewables Mesquite Solar Project will create one permanent job.  That is if investors take a shining to the project.

Sunday, September 18, 2016

OE Renewables Update as of August 30th

San Angelo hosted the Wind and Solar Expo 2016 August 30-31.  Southwest Energy Coalition put on the event.  Their webpage posted presentations, two of which dealt with OE Renewables solar farm on city property.    The Chamber of Commerce had one slide (shown above). 

OE Renewables had six slides dealing with the project.  Number 10 on the list below is negotiate potential tax abatements.  An August 2015 report by San Angelo Live stated OE Renewables staff "hope to negotiate local tax incentives provided by Tom Green County and the City of San Angelo."   The city capitulated last year, providing $583,814 in incentives.

Tom Green County Commissioners heard a proposal on October 27, 2015.  The minutes state:

15. Discussion, consideration and action on the designation of the County Reinvestment Zone made the subject of the public hearing to be known as “OneEnergy Renewables Tom Green County Reinvestment Zone”.
Moved to Table #15 and reset a Public Hearing due to use of the term unincorporated in the agenda item.
The issue concerning County Commissioners was "If you sell the improvements will the tax abatement convey with the sell or would it have to come back to court for the new ownership."

Oddly there is no information on OE Renewables success in marketing solar power to energy users hoping to lock in prices for decades. 

As for buyers of this renewable energy, OneEnergy contracts with utilities, corporations, governmental entities and universities because of contract longevity. The company offers contract terms from 10 years to 25 years or more.
Other slides are shown below:

The expo also had a presentation from Goodfellow Air Force base, which is planning its own solar generating project across the street from the base. 

That's one customer OE Renewables would love to have.  Goodfellow could utilize half to all of the power from the Mesquite Solar Farm. 

OE Renewables is developing the Mesquite Solar Project with hopes to sell it to investors wanting a predictable income stream.  The math depends on public subsidies and paying customers.  The presentation is light on both, meaning OE Renewables is keeping its cards close to its chest or the project remains up in the air.

Sunday, August 28, 2016

City Council Can Educate Public on Economic Development Awards

In their August 24th meeting San Angelo's Development Corporation approved a $600,000 economic development incentive for local employer CalTech.  Longtime Development Corporation board member Scott Tankersley works for CalTech as a Tier 3 Services Manager.  He does not sit on CalTech's board nor does he own a stake in the company.

CalTech's website states two people own the company, Will Welch and Brent McCasland.  However, the company does share profits with employees so conceivably a portion of the $600,000 award, should it be earned, could come back to Tankersley in a much smaller amount.  

San Angelo Mayor Dwain Morrison brought back ethics standards for city officials regarding economic development awards.  Morrison served on City Council when standards were loosened to enable then Mayor Alvin New to stay in office while the city awarded a $3.6 million economic development agreement for MedHab.  New served on MedHab's board and held equity stakes in the company high enough to trigger the old rules.

The Development Corporation chose not to speak directly to the public on the rule and how Tankersley's position at CalTech complied with the agreement.  It seemed like a missed opportunity for an organization that practiced deceit not terribly long ago. 

I trust Mayor Morrison to educate the public as to how Scott Tankersley's COSADC board service is not in conflict with CalTech's $600,000 economic development award.  The opportunity to educate is not over.

Update 9-4-16:  The CalTech $603,050 economic development award is on City Council's agenda for their September 6 meeting.  It is on the consent agenda, so a City Council person would need to pull the item for public presentation and discussion.

Update 9-6-16:  City Councilman Harry Thomas publicly declared his son works for CalTech and recused himself from this agenda item by leaving the room.  Staff and elected officials did not share COSADC board member Scott Tankersley's similar action when the item came up for consideration.

Update 9-25-16:  An editor for the Standard Times did what city leaders wouldn't.  The editor wrote "Council member Harry Thomas, SMD 3, recused himself from discussion and voting on the CalTech item as his son works for the company. COSADC board member Scott Tankersley likewise absented himself during CalTech proceedings, as he is a longtime employee of the company."