City Council - 7/17/23

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Combined Agency/City Council Minutes Page 1 of 5 July 17, 2023

CITY OF PITTSBURG

CITY COUNCIL/AGENCY CONCURRENT MEETING MINUTES

DATE: July 17, 2023

LOCATION: Council Chamber, City Hall, 65 Civic Avenue, Pittsburg, CA 94565

CITY COUNCIL/AGENCY MEMBERS

Shanelle Scales-Preston, Mayor/Chair

Juan Antonio Banales, Vice-Mayor/Chair

Jelani Killings, Council/Agency Member

Dionne Adams, Council/Agency Member

Angelica Lopez, Council/Agency Member

S.L. Floyd, Agency Member

Annie Hill Herring, Agency Member

APPOINTED OFFICIALS

Garrett Evans, City Manager/Executive Director

Donna Mooney, City Attorney/Legal Counsel

Alice E. Evenson, City Clerk/Agency Secretary (elected)

Nancy Parent, City Treasurer (elected)

Vice Mayor Banales called the regular meeting to order at 7:00 P.M. in the Council

Chamber at City Hall, 65 Civic Avenue Pittsburg, CA. The City Council did not convene in

Closed Session at 6:00 P.M. as the following Closed Session Item was continued to a date

uncertain:

1\. CONFERENCE WITH REAL PROPERTY NEGOTIATORS pursuant to Section 54956.8

Property: 25 W. 10th Street (085-201-005) and 45 W. 10th Street (085-201-004); City

Negotiators: Garrett Evans and Maria Aliotti; Negotiating Parties: Eric Keena on behalf of

SK Pittsburg Bay Point LLC; Under negotiation: Both price and terms of payment

ROLL CALL

Mayor/Chair Scales-Preston and Member Adams were absent and excused.

PLEDGE OF ALLEGIANCE

Vice Mayor Banales led the Pledge of Allegiance.

PRESENTATION

2\. Presentation of the Accessory Dwelling Unit Guidebook and Pre-Approved Accessory

Dwelling Unit Prototype Plan Set

>> GOOD EVENING, EVERYONE. IT IS NOW 7:00. I WOULD LIKE TO CALL THE CITY COUNCIL MEETING TO ORDER. MADAME CLERK, CAN YOU PLEASE CALL ROLL ? COUNCIL MEMBER KILLINGS , BANALES . >> CAN EVERYONE PLEASE STAND AND JOIN ME IN THE PLEDGE OF ALLEGIANCE. >> I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA AND TO THE REPUBLIC FOR WHICH IT STANDS ONE NATION UNDER GOD INDIVISIBLE WITH LIBERTY AND JUSTICE FOR ALL. >> OKAY, WE WILL MOVE ON TO PRESENTATIONS. MR. CITY MANAGER? >> THANK YOU VERY MUCH MR. VICE MAYOR. THE STAFF WOULD LIKE TO PULL VISITATION ON DWELLING UNITS AND RETURN ON A LATER DATE. >> EXCELLENT. THANK YOU. WE FIRST PROCLAMATION IS FOR NATIONAL NIGHT OUT. WILL TONY BOB DOLE SO PLEASE STEP TO THE PODIUM? AND COUNCIL MEMBER KILLINGS WILL READ THIS PROCLAMATION . >> THIS PROCLAMATION IS FOR NATIONAL NIGHT OUT, 2023 WHEREAS NATIONAL NIGHT OUT IS AN ANNUAL COMMUNITY BUILDING CAMPAIGN THAT PROMOTES POLICE COMMUNITY PARTNERSHIPS AND NEIGHBORHOOD TO MODERATE TO MAKE OUR NEIGHBORHOOD SAFER, BETTER PLACES TO LIVE AND WHERE IS THE 40th ANNUAL NATIONAL NIGHT OUT PROVIDES A UNIQUE OPPORTUNITY FOR THE CITY OF PITTSBURG TO JOIN FORCES WITH THE'S OF OTHER COMMUNITIES ACROSS THE COUNTY AND PROMOTING CRIME DIVISION EFFORTS. WHERE NATIONAL NIGHT OUT ENHANCES THE RELATIONSHIP BETWEEN NEIGHBORS AND LAW ENFORCEMENT ARE BRINGING BACK A SENSE OF COMMUNITY. FURTHERMORE, IT PROVIDES A GREAT OPPORTUNITY TO BRING POLICE AND NEIGHBORS TOGETHER WHEREAS A CELEBRATION IS PLANNED AT THE PARK ON TUESDAY AUGUST 1st, 2023 , FROM 5:00 PM UNTIL 8:00 PM AND IT IS ESSENTIAL THAT ALL RESIDENTS COME TOGETHER WITH THE POLICE AND WORK TOGETHER TO BUILD A SAFE AND CARING COMMUNITY. NOW THEREFORE, ON BEHALF OF THE CITY COUNCIL OF PITTSBURG, DOES HEREBY ENCOURAGE ALL CITIZENS OF PITTSBURG TO CELEBRATE THE 40th ANNUAL NATIONAL DAY OUT ON AUGUST 1st, 2023. >> YES, WE WOULD LIKE TO SAY THANK YOU ON BEHALF OF THE PITTSBURG POLICE DEPARTMENT SUPPORTING A AND THE COMMUNITY. WE HAVE A GREAT TIME EVERY YEAR AND I THINK EVERY YEAR TENDS TO GET BIGGER AND BIGGER. I THINK WE HAVE ADVERTISED IT MORE THIS YEAR AND WE HAVE HAD MORE COMMUNITY RESOURCES REACH OUT TO US SO THERE WILL BE A VARIETY OF DIFFERENT RESOURCES THIS YEAR AND WE ARE GEARING TOWARD THE SCHOOL DISTRICT TO HELP THE KIDS THAT ARE IN NEED THIS YEAR, RESOURCES FROM COMCAST OR PEOPLE , THE HOMELESS SHELTER KIDS WHO NEED HELP, HOMELESS KIDS THAT ARE IN NEED, ALSO. SO WE ARE TEAMING UP WITH THE SCHOOL DISTRICT TO BRING MORE RESOURCES TO THIS EVENT AND ALSO ON BEHALF OF THE POLICE DEPARTMENT AND ENGAGE MORE WITH THE COMMUNITY AND THE YOUTH. SO WE APPRECIATE YOU GUYS AND HOPEFULLY, YOU GUYS CAN SUPPORT US ON AUGUST 1st. WE HOPE TO >> WE WILL MOVE ON TO CITY MANAGER REPORTS OR REMARKS. MR. CITY MANAGER? >> TONIGHT, A SPECIAL CITY MANAGER COMMENT , IT IS A BIT BITTERSWEET IN THAT WE WANT TO THANK A COUPLE OF COMMISSIONERS THAT SERVED WELL ON THE YOUTH COMMISSION BUT THEY ARE MOVING ON TO BIGGER AND BETTER THINGS WHICH IS GREAT BUT WE HATE TO SEE THEM GO. SO, FOR THOSE IN THE AUDIENCE, PITTSBURG YOUTH COMMISSION IS COMPRISED OF PITTSBURG YOUTH BETWEEN 12 AND 21 AND WE HAVE THREE GRADUATING SENIORS THIS DREAM. AND WE ARE GOING TO MAKE THEM. THE FIRST IS CHAIR MICHAELA, A KEYNOTE, WE WILL BE CONTINUING HER YOU EDUCATION AT BUTLER UNIVERSITY . A FANTASTIC UNIVERSITY, MAJORING IN CHEMISTRY WITH A PRE-MEDICINE PATHWAY. SHE IS IN THE AUDIENCE AND COMING UP TO THE PODIUM DO WE REALLY WANT TO THANK HER. WE HAVE A SPECIAL AWARD FOR HER THAT WANT TO ACKNOWLEDGE THE OTHER TWO AND WE WILL GO OVER TO MICHAELA. THE OTHER TWO GRADUATES WERE UNABLE TO ATTEND OUR VICE CHAIR , THEA WHO WILL BE GOING TO LNC MAJORING IN COMPUTER SCIENCE AND DAN L GELATO WAS GOING TO BE GOING ON TO UC DAVIS IN FOOD SCIENCE. WE CERTAINLY WANT TO THANK ALL THREE OF THEM BUT NOW WE HAVE THE, OUR CHAIR, MICHAELA. AND I KNOW THE COUNCIL MEMBER HAS ACKNOWLEDGMENT THAT WE GET HER,. >> THANK YOU MR. CITY MANAGER AND TO THE VICE MAYOR . THIS IS DEFINITELY AN HONOR AND A PRIVILEGE TO PRESENT THIS AWARD AND RECOGNITION TO MICHAELA . I HAVE THE PERSONAL HONOR TO KNOW MICHAELA AND HER FAMILY AND TO BE ABLE TO SEE HER GROW, THE ADVERSITY SHE HAS GONE THROUGH AND TO SEE THE SHINING LIKE THAT SHE IS IN OUR COMMUNITY AMONGST HER PEERS IS AN AMAZING OWNER. JUST TO SHARE A LITTLE BIT ABOUT MICHAELA AND I AM NOT GOING TO TRY TO EMBARRASS HER IN ANY WAY THAT I REMEMBER IN FOURTH GRADE, SHE RAN FOR CLASS PRESIDENT AT FOOTHILL ELEMENTARY SCHOOL AND ALTHOUGH SHE DIDN'T GET IT, RESOLVED THAT SHE CONTINUED AND CARRIED FROM THAT MOMENT FORWARD TO BE ABLE TO THEN GRADUATE AS SENIOR CLASS PRESIDENT OF HER HIGH SCHOOL TO SHOW SOME TESTAMENT OF HER LEADERSHIP ALSO SERVING AS THE DRUM MAJOR FOR PITTSBURG HIGH SCHOOL MARCHING JOB IN THIS LAST YEAR AND ALL OTHER ACCOLADES THAT I COULD PYLON RIGHT NOW WHICH I AM GOING TO DO BUT I JUST WANT TO SAY THAT WE ARE TREMENDOUSLY PROUD OF YOU, MICHAELA, FOR REPRESENTING THE CITY OF PITTSBURG . SHE STEPPED UP DURING COVID AS A COVID AMBASSADOR TO GET INFORMATION OUT TO THE COMMUNITY ABOUT COVID AND SHE IS STRONG IN HER RESOLVE AND WE KNOW SHE WILL DO GREAT THINGS IN REPRESENTING THE CITY OF PITTSBURG AND REPRESENTING HER FAMILY AND EVERYTHING THAT YOU ARE. AS I WANT TO SAY THANK YOU. IT HAS BEEN AN HONOR TO WATCH YOU GROW AND IT HAS BEEN WONDERFUL TO PROVIDE -- AS OUR PITTSBURG CHAIR OF THE YOUTH COMMISSION . [ APPLAUSE ] >> THANK YOU VERY MUCH COUNCILMAN KILLINGS . ANY ADDITIONAL COMMENTS? SPOT JUST A POINT OF ORDER FOR THOSE WHO MAY BE CURIOUS. THE CLOSED SESSION EARLIER TONIGHT DID NOT MEET. JUST TO MAKE SURE THE PUBLIC IS AWARE OF THAT. THANK YOU SO MUCH. >> WE MOVE ON TO PUBLIC COMMENTS. MADAME CLERK, ARE THERE ANY PUBLIC COMMENTS ON NON-AGENDA ITEMS? >> THE FIRST SPEAKER, ROSEMARY VET DOG OF . >> HELLO, MY NAME IS ROSEMARY RANDAZZO . I HAVE AN ISSUE ABOUT , THERE IS A SHELTER THAT HAS APARTMENTS ACROSS THE STREET FROM ME AND THIS ONE LADY KEEPS CALLING THIS NUMBER TO COMPLAIN ABOUT NEIGHBORS AND COMPLAINTS. YOU REALIZE WHAT THAT NUMBER IS? THEY CALL ANONYMOUSLY AND THEY REPORT THINGS THAT MAYBE THEY DON'T LIKE. SO IN THE MEANTIME, NO ONE IS RESPONDING TO THAT. WELL, THERE ARE SEVERAL OF US THAT I'M GOING TO CONTACT THE MANAGEMENT OF SHELTER INC. SO THEY CAN REPRIMAND THIS WOMAN BECAUSE SHE IS ANNOYING TO A LOT OF PEOPLE IN THE NEIGHBORHOOD AND SHE RECENTLY CALLS AND I WORK -- DO YOU HAVE THE PAPER, THE OUR FOUNDATION FOR CAT HUMANE --? >> YES, WE DO . >> THEY SENT ME THIS AND I HAVE TWO RECERTIFICATION ALL OF THE CATS THAT I TAKE CARE OF AND I FEED AND SO CODE ENFORCEMENT JUMPED OUT OF THE CAR AND SHE COMES. I HAVE ALREADY BEEN TARGETED AND HARASSED BY THE CITY CODE ENFORCEMENT DEPARTMENT AND I FEEL LIKE THAT WASN'T JUST. AND SHE COMES OVER AND SAYS, WE GOT A COMPLAINT ABOUT YOUR HOUSE. WE GOT A COMPLAINT THAT YOU ARE FEEDING THE CAT THIS TASTEFULLY OR SOMETHING IN FRONT OF MY HOUSE AND I HAVE BEEN FEEDING THESE CATS WERE LIKE YEARS. AND ANIMAL CONTROL HAS COME OUT THERE AND THEY , THE CATS ARE FIXED AND THEY ARE WELL FED AND THEY ARE FINE AND THEY DON'T SAY ANYTHING ABOUT IT. SO I CAME HERE IN COMPLAINT THAT I FEEL LIKE I AM TARGETED AND HARASSED WHEN THOSE CALLS KEEP COMING IN BUT LIKE TO SING OR PLAY, THE SAME PERSON. SHOULDN'T THEY BE KIND OF SCREWED NINE? YOU KNOW, WHY DO YOU KEEP PICKING ON THE SAME PERSON ABOUT THE SAME ISSUES? JUST BECAUSE THEY DON'T LIKE WHATEVER IT IS . AND SO, I CAME HERE TODAY AND I WANT FOR ANY OF YOU TO SAY IT IS OKAY, YOU CAN STILL CONTINUE THE WAY I AM TAKING CARE OF THE ANIMALS AND FEEDING THEM. AND I HAVE A WATER CONTAINER THAT MEYER RIVERS SEEMS TO THINK ARE NOT ACCEPTABLE. IT IS JUST A CUT OFF GALLON BECAUSE YOU CANNOT REALLY PUT REGULAR BOWLS . WHAT IS YOUR RESPONSE? AND THEY COME BACK OVER AGAIN, I WANT TO HAVE A CLEAR TO CITY COUNCIL . BUT I'M NOT DOING ANYTHING ILLEGAL OR ANYTHING. YOU CANNOT LEAVE THEM IN THE WATER? I CANNOT STICK THEM ALL IN THE BUSHES OR ANYTHING AND THERE ARE SOME CASH TO COME THOSE APARTMENTS OVER THERE THAT COME AND GET WATER AND GO BACK. >> THANK YOU MRS. RANDAZZO, WE APPRECIATE YOU COMING OUT AND MAKING A COMMENT. I WOULD LIKE TO ASK CITY MANAGER IS A MEMBER OF STAFF CAN GET IN CONTACT WITH YOU ABOUT YOUR CONCERNS BUT I DEFINITELY APPRECIATE YOU COMING OUT AND GIVING US YOUR CONCERNS. >> HE IS SUPPOSED TO CALL ME? >> A MEMBER OF STAFF WILL REACH OUT TO YOU SHORTLY WHEN YOU GO BACK TO YOUR . A STAFF MEMBER WILL GIVE YOU THE COME BACK TO INFORMATION. >> OH, OKAY, THANK YOU. >> THE NEXT SPEAKER, PLEASE. >> KEVIN BAILEY. >> GOOD EVENING MAYOR AND CITY COUNCIL MEMBERS. MY NAME IS KEVIN BAILEY. I AM A MEMBER OF LOCAL 43 METERS. HERE TO TALK ABOUT THE BAY WALK PROJECT AND WE HAVE BEEN TRYING TO TALK TO THE CONTRACTOR BUT THEY WOULD NOT COME TO THE TABLE TO TALK ANY UNION TRADES. AND NOW, THAT HAS BEEN CHANGED. THEY TALK TO US AND WE HAVE A MEETING TOMORROW. AND ALSO, WE WILL GET BACK TO AS FAR AS IN A COUPLE OF WEEKS AS TO WHAT THEY WERE TALKING ABOUT, THE PROGRESS. ALSO, WE HAVE MEMBERS THAT LIVE HERE IN THE PITTSBURG AREA, THOUSANDS, BASICALLY, IN THE TRADES. AND WE WOULD LIKE TO WORK ON THIS PROJECT, ALSO. WE HAVE APPRENTICES COMING UP IN THIS TRADE AND THEY WOULD LIKE TO BECOME MEMBERS. ALSO, MIDDLE INCOME WAGES AND BE A PART OF THE COMMUNITY. AND MAKE IT A BETTER PLACE. AND ALSO, -- THANKS. >> THANK YOU VERY MUCH, MR. BAILEY. >> THE NEXT SPEAKER, PLEASE. >> CELINE ? >> GOOD EVENING VICE MAYOR. COUNCIL MEMBERS , CITY STAFF, MY NAME IS CELINE. I AM ALSO PLANNING COMMISSIONER FOR THE CITY OF PITTSBURG . I STAND BEFORE YOU TO ASK YOU TO PLEASE CONSIDER SUPPORTING THE PITTSBURG ARTS COMMUNITY FOUNDATION. I UNDERSTAND IT MAY NOT HAVE BEEN AS PROJECT AS PROJECTED BUT COVID HAD A HUGE IMPACT ON NOT ONLY THE FOUNDATION BUT EVERYTHING AROUND US. THE ENTIRE WORLD CAME TO A STANDSTILL YOU STILL HAVE STRONG COMMITTED PEOPLE WHO STRUGGLE TO KEEP IT ALIVE WITH THE TOOLS THAT THEY HAD. PERHAPS THE DRAWNOUT TARGETS AND GOALS, AGREEMENTS AND GUIDELINES, THE FOUNDATION WOULD HAVE A FRESH TOOLBOX TO DRIVE INTO THE DIRECTION YOU WOULD LIKE TO SEE. PF CA IS VERY IMPORTANT AND BRIDGES THE GAP BETWEEN WHAT ONE SEES IN THE MIND AND THE REALITY OF. OUR BEAUTIFIES OUR WORLD AND GIVES US A BETTER UNDERSTANDING OF IT. IT GIVES US ENCOURAGEMENT, SELF-EXPRESSION, CREATIVITY. IT BUILDS CONFIDENCE AND EMOTIONAL GROWTH. IT CAN PULL OUT SKILLS IN PEOPLE THAT THEY NEVER KNEW THEY HAD WITHIN THEM AND THEY APPLY IT IN POSITIVE WAYS IN TODAY'S HARSH WORLD . SO PLEASE DON'T LET PACS DIE. THANK YOU. >> THANK YOU VERY MUCH. >> THERE ARE NO MORE SPEAKERS . >> WE WILL MOVE ON TO COMMITTEE REPORTS. ARE THERE ANY COUNCILMEMBERS WHO WOULD COUNCIL MEMBER KILLINGS . >> TO THE VICE MAYOR, PER SUBCOMMITTEE THAT MET WAS PITTSBURG ARTS AND COMMUNITY FOUNDATIONS OF COMMITTEE BACK ON JUNE 26th . WE RECEIVED AN UPDATE OR HAD A DISCUSSION ABOUT THE PHYSICAL 23-24 PROPOSED BUDGET AND ALSO RECEIVED AN UPDATE AS FAR AS THE BOOKSTORE RELOCATION AND THOSE EFFORTS WITH THE NEW RELOCATION TO THE OLD ART BUILDING THAT IS NOW ON THE RAILROAD . ALSO, WE DID HAVE A CONVERSATION ABOUT THE STRATEGIC PLAN UPDATE WHICH WE JUST HAD A DISCUSSION AT THE LAST COUNCIL MEETING ABOUT SO COUNSEL IS AWARE OF THAT STRATEGIC PLAN PROCESS AND THE RECOMMENDATION WITH THE DIRECTION WE RECEIVED AT THE LAST MEETING. WE ALSO RECEIVED A PRESENTATION OR ABOUT DATE UPDATE ABOUT CURRENT ACTIVITIES BEING PROVIDED BY PSE F. LASTLY ON JULY 12 , THE ECONOMIC DEVELOPMENT AND WATERFRONT DEVELOPMENT SUBCOMMITTEE MET . ITEM OF DISCUSSION WAS THE BRAND MARKETING REQUEST PROPOSAL SO STAFF IS GOING THROUGH AND SELECTING THE FINAL CANDIDATES THAT WENT THROUGH THE PROCESS FOR BRANDING AND MARKETING PROPOSAL THAT HAS COME FORTH FOR THE CITY . SO WE WILL HEAR MORE ABOUT THAT IN THE SUBCOMMITTEE AS A SWORD AND BRING TO THE COUNCIL ANY FINAL ACTION THAT WILL BE TAKEN . WE ALSO HAD AN UPDATE FROM OUR ENVIRONMENTAL SERVICES DEPARTMENT REGARDING THE CITY OF PITTSBURG'S SUSTAINABILITY PLAN SO THIS WAS WRITTEN A PRESENTATION ABOUT THE SUSTAINABILITY PLAN THAT IS OUT FOR PUBLIC REVIEW. ANY MEMBERS OF THE PUBLIC INTERESTED WHEN IT COMES TO REDUCING GREENHOUSE GAS OMISSIONS AND ALL OF THE DATA POINTS THAT GO INTO THAT REALLY WANT TO GIVE CREDIT TO THE ENVIRONMENTAL SERVICES DEPARTMENT. CELL PHONE TO AND HER TEAM SO THAT IS OUT CURRENTLY FOR ANY MEMBERS OF THE GIVE ANY PUBLIC COMMENT ON THAT DRAFT BEFORE IT IS FINALLY ADOPTED. NEXT, WE DID RECEIVE SOME HIGHLIGHTS AND UPDATES FROM THE ECONOMIC DEVELOPMENT DEPARTMENT ABOUT A LOT OF DEVELOPMENT THAT IS TAKING PLACE HERE IN THE CITY, A LOT OF PROJECTS THAT ARE COMING ONLINE. IT REALLY IS AN EXCITING TIME IN YOUR IN THE CITY OF PITTSBURG AND A LOT MORE THAT IS COMING DOWN THE PIKE SO WE ARE EXCITED ABOUT THAT AND WE ALSO RECEIVED SOME ARENA HIGHLIGHT AND UPDATES ON WHAT IS GOING ON ON OUR WATERFRONT. EVENTS THAT ARE COMING UP FOR OUR MARINA AS WELL REALLY CELEBRATING CITY STAFF IN TERMS OF THE AWARD AND THE GRANT WE RECEIVED FOR THE PARK THAT IS DOWN THERE ON THE WATERFRONT TO REALLY REIMAGINE THAT AND MAKE SOME INVEST ALONG WITH THE PARKING LOT WHERE THE BOATS LAUNCH AND THE RAMP IS SO WE ARE LOOKING FORWARD TO SEEING THAT COME ONLINE AND CONTINUE WITH THE ECONOMIC DEVELOPMENT EFFORTS IN THE CITY OF PITTSBURG . WITH THAT, THAT IS ALL I HAVE TO REPORT OUT. >> THANK YOU. WE WILL MOVE ON TO PITTSBURG POWER COMPANY. SO WE WILL NOW MEET AS THE PITTSBURG POWER COMPANY BOARD OF THE CITY OF PITTSBURG . I WILL OPEN THE PUBLIC HEARING AND TURN IT OVER TO YOU , MR. CITY MANAGER, FOR ITEM NUMBER FOUR. >> THANK YOU VERY MUCH MR. VICE CHAIR AND MEMBERS OF THE BOARD. TONIGHT'S PUBLIC HEARING IS APPROVING ISLAND ENERGIES FISCAL YEAR 23 -24 GRADE CHANGE PROPOSAL FOR ELECTRICITY RETAIL SERVICES ON MERRILL ISLAND. WE HAVE PPC MANAGER, THE ADMINISTRATIVE OFFICER HERE WITH A PRESENTATION. IS IT VANESSA OR JOHN? >> GOOD EVENING. I AM DOUG BUCHANAN , THE POWER COMPANY MANAGER FOR PITTSBURG POWER COMPANY ENERGY REFERRING TO THE DEPARTMENT AS ISLAND ENERGY GOING FORWARD. WITH ME IS VANESSA SHAY AND SHE IS OUR ADMINISTRATIVE OFFICER THAT PERFORMS AS THE BUSINESS MANAGER FOR PPC ENERGY. A LITTLE BIT OF CONTEXT. THE EXPLANATION OF CONTEXT TO THE BOARD. WE ARE HERE TONIGHT TO PRESENT AN INCREASE IN ELECTRIC RATES FOR THE ISLAND ENERGY UTILITY. DUE TO A NUMBER OF FACTORS AND A LITTLE BIT OF CONTEXT. AS THE CITY OF PITTSBURG IS EXPERIENCED , EVERYONE HAS EXPERIENCED, OVER THE LAST THREE YEARS, COVID PANDEMIC. WHICH HAS PUT GREAT STRAIN ON BOTH THE MUNICIPALITY AND THE UTILITY. DURING THIS PERIOD, WE ELECTED TO CEASE ANY TERMINATIONS OR SHUTOFFS . WE ATTEMPTED TO HOLD OUR RATES FLAT . WE DID HAVE A MINOR RATE INCREASE LAST YEAR BUT THINGS HAVE CAUGHT UP WITH US. AND WE ARE HERE TO PROPOSE A RATE INCREASE THAT PUTS US ON A MORE STABLE FINANCIAL FOOTING GOING FORWARD. AS BRIEF BACKGROUND AND VANESSA WILL ADDRESS SOME OF THIS IN MORE DETAIL GOING FORWARD. OH, BY THE WAY, SHE GAVE ME THE EASIEST SLIDES. [ LAUGHTER ] SO, I'M REALLY HAPPY ABOUT THAT. JUST AN OVERVIEW OF WHAT COMPRISES OUR EXPENSES. WHOLESALE ELECTRICITY PROCUREMENT AND TRANSLATION . WE RECEIVED COMMODITY, ELECTRIC CAPACITY AND ENERGY FROM THE WESTERN AREA POWER ADMINISTRATION AND THIS IS A LEGACY CONTRACT THAT WE OBTAINED FROM THE NAVY TOOK OVER THE FRANCHISE IN 1997. SO WE RECEIVE OUR ENERGY FROM WESTERN AND YOU MAY BE FAMILIAR WITH THEM. THEY OPERATE THE BONNEVILLE SERIES OF DAMS AND ALSO THE CENTRAL VALLEY PROJECT, HYDROELECTRIC. AND WE RECEIVED OUR ENERGY FROM THEM. WESTERN IS A FULL SERVICE PROVIDER TO THE PITTSBURG POWER COMPANY. THAT IS THEY DO SCHEDULING, DELIVERY THROUGH PG&E'S TRANSMISSION SYSTEM AND IN THE EVENT THAT WE HAVE A SHORTFALL IN HYDRO WHICH I WILL SPEAK TO IN A MOMENT, THEY PROCURE ENERGY ON PVC'S BEHALF. SO IT IS A FULL SERVICE PROVIDER. AND WE HAVE BEEN UNDER CONTRACT WITH THEM SINCE 1987. WE JUST WENT THROUGH A CONTRACT RENEWAL AND THEY CONTINUE TO -- FOR PPC RHODE ISLAND. WE ALSO HAVE EXPERIENCED A DRAMATIC INCREASE IN TRANSMISSION SERVICES COST . THAT IS GETTING THE POWER FROM THE DAMS TO THE THIRD PARTY PROVIDERS, OTHER GENERATION TO US AND THAT COMES THROUGH THE CALIFORNIA INDEPENDENT SYSTEM OPERATOR . LAST YEAR, WE EXPERIENCED SUCH A DRAMATIC INCREASE IN THEIR COSTS TO US TO DELIVER THE ENERGY WE GET FROM -- IN ADDITION TO THE DELIVERY COST , WE HAVE UTILITY REGULATORY REQUIREMENT . WE ARE CURRENTLY IN THE MIDST OF A CALIFORNIA PUBLIC UTILITIES COMMISSION AUDIT OF OUR GAS SYSTEM . WHICH HAS BEEN CONSUMPTIVE . AND WE ARE WORKING THROUGH THAT. STAFF SALARY AND BENEFITS. AS OF TWO YEARS AGO, PPC STAFF IS NOW PART OF THE NATIONAL BROTHERHOOD OF ELECTRICAL WORKERS CHAPTER 1245 . SO WE ARE ON A SALARY AND BENEFIT COMPETITIVE BASIS WITH GMD AND OTHER UTILITIES. THE ADMINISTRATIVE AND GENERAL OVERHEAD. FAIRLY SELF-EXPLANATORY. WE DO CONTRIBUTE TO THE CITY IN TERMS OF OVERHEAD FOR THE SERVICES RECEIVED FROM FINANCE , LEGAL AND OTHER DEPARTMENTS. SO WE MAKE THAT CONTRIBUTION. UTILITY OPERATIONAL AND MAINTENANCE. DAY-TO-DAY MAINTENANCE. AND TROUBLESHOOTING AND REPAIR. AN OUTAGE ON OUR SOUTH ISLAND. THAT HAS TAKEN THE CREW , IT HAS CONSUMED THE CREW FOR THREE DAYS NOW DUE TO A FAILED BREAKER. AS SO WE ARE ATTEMPTING TO BE AS RESPONSIVE AS WE CAN BE. HER CIRCUIT COVERS THE COAST GUARD, TELECOMMUNICATIONS AND TRAFFICKING. THESE ARE SORT OF THE DAY TODAY SORT OF THINGS WE HAVE TO FACE. LAST IS CAPITOL IMPROVEMENT. OVER THE LAST THREE YEARS, WE HAVE REDUCED OUR CAPITOL IMPROVEMENT PROGRAM 4% ? YEAH. IN ORDER TO SATISFY THESE OTHER DEMANDS AND NOT INCREASE RATE. SO , ANECDOTALLY, WE ARE KIND OF HANGING OUT THERE A LITTLE BIT IN TERMS OF OUR CAPITOL IMPROVEMENT PROGRAM. THAT IS A BRIEF OVERVIEW OF THE COSTING OF THE UTILITY. GOING FORWARD, PUTTING REVENUE FORECAST , WE INCLUDE OUR SALES FORECAST BASED ON HISTORICAL AND PROJECT IT , OUR OPERATING EXPENSE FORECAST. AGAIN, EMPLOYEES AND OVERHEAD AND TARGET OUR REVENUE TO COVER OUR COST OF SERVICE. SO THAT IS WHY WE ARE HERE, TONIGHT. WE ARE HERE FOR A RATE INCREASE PROPOSAL AS A MEANS TO COVER OUR COST OF SERVICE GOING FORWARD. AND IT IS PRETTY MUCH A PLUS AND MINUS GAME. GOING FORWARD. BEFORE WE GET TO THE TABLE, THE LITTLE BULLET, OVER THE PAST YEAR AND A HALF, TWO YEARS, WE HAVE SEEN SKYROCKETING NATURAL GAS PRICES. AND FOR ISLAND ENERGY, OUR GAS IS A PASTOR. SO WHATEVER WE PROCURE GAS FROM THE DEPARTMENT OF GENERAL SERVICES, IT IS PASSED TO THE CUSTOMER. A YEAR AND A HALF AGO, WE WERE PAYING $0.84 FOR NATURAL GAS. IN JANUARY, IT WAS THREE DOLLARS AND 25 , APPROXIMATELY. IT IS ALMOST A FOUR -FOLD INCREASE. THAT WAS DRIVEN LARGELY THROUGH A MAJOR PIPELINE SERVICE IN CALIFORNIA THROUGH DEPLETED STORAGE , PG&E'S SIDE AS SOME CLAIM THERE WAS SOME MARKET MANIPULATION INVOLVED, ALSO. THOSE PRICES HAVE COME DOWN BUT IT GIVES YOU A SENSE OF WHAT WE ARE CHARGED WITH. $0.84 TO $3.25 . COMPOUNDED ON THE ELECTRIC SIDE WAS EXTREME DROUGHT. THE RESERVOIRS THAT WE RELY ON PPC THROUGH WAPA ARE PRIMARILY CONTAINED IN WHAT IS CALLED THE CENTRAL VALLEY PROJECT LIKE OROVILLE, DON PEDRO, OTIS AND I BELIEVE SHASTA IS ALSO IN THAT MIX. AND COMING INTO AUGUST OF LAST YEAR, THEY WERE ESSENTIALLY EMPTY. WE HAVE BEEN BLESSED WITH SOME FAIRLY HISTORIC RAINFALL, THIS YEAR. AND THE RESERVOIRS I HAVE JUST NAMED LARGELY TOPPED OFF SO WE ARE HOPING FOR SOME REAL PRICE RELIEF , COST RELIEF THIS YEAR. AND THAT IS TO BE SEEN. WE HAVE ALREADY SEEN PRICES GO DOWN WHERE WAPA DOES NOT HAVE TO GO INTO THE MARKET TO BUY THERMAL GENERATION OR OTHER SO WE ARE HOPING FOR PRICE RELIEF, THERE . LASTLY, AS YOU ALL KNOW AS YOU'RE HEADING TO THE SHOPPING CENTER, HIGH INFLATION. THAT IMPACT OUR BUSINESS, ALSO. SO IT IS KIND OF A TRIPLE WHAMMY OVER THE LAST YEAR IN TERMS OF PRICING. DEPLETED CAPITOL RESERVES , EXTRAORDINARILY HIGH ENERGY COSTS , INFLATION AND DROUGHT. A QUICK TAG POINT ON THIS. A YEAR AND A HALF AGO , WE WERE PURCHASING ENERGY FROM WAPA, DELIVERED COST , $.11 PER KILOWATT HOUR. TOTAL DELIVERED COST. IN JANUARY, IT WAS ZERO DOLLARS AND 21 SAID. TO GIVE YOU A SORT OF A SENSE OF MAGNITUDE. 100% INCREASE. THE NEXT SLIDE IS BASICALLY A REPRESENTATION OF WHAT I HAVE JUST DESCRIBED. YOU CAN SEE ON THE LEFT SLIDE WHERE THE NATURAL GAS STORE RESERVES HAVE JUST COLLAPSED ON THE BLUE LINE. ON THE RED LINE, YOU CAN SEE THE PRICE SKYROCKETING. AND ON THE SLIDE ON THE LEFT, THE $0.84 I DESCRIBED IN JANUARY, IT WAS $3.45 WE WERE PAYING FOR GAS. A HUGE BURDEN ON OUR CUSTOMERS. AND, FRANKLY, IT BECAME A DIFFICULT PROBLEM TO MANAGE, TOO. 310%. AT THIS POINT, I WOULD LIKE TO TRY THIS OVER TO VANESSA TO PROVIDE SOME ADDITIONAL DETAIL AS TO WHAT WE HAVE SEEN IN THE MARKET AND HOW WE ATTEMPT OR INTENT TO ADDRESS IT. THANK YOU. >> THESE ARE ACTION MY FAVORITE SLIDES BECAUSE IT SHOWS THE STRONG CORRELATION . REPRESENTING THE PERCENTAGE OF HYDROPOWER IN OUR ENERGY PURCHASE AND THE LINE REPRESENTS WHOLESALE PRICE. AS FISCAL YEAR 16, 17 OR 1920 WHEN HYDROPOWER ACCOUNTS FOR 40 OR 50% OF TOTAL PURCHASE . WHOLESALE ELECTRICITY PRICE COULD BE AS LOW AS $0.67 PER KILOWATT HOUR. STARTING FROM FISCAL YEAR 2021, WE ARE HEADING TO MAKE A DROP YET SO HYDRO SUPPLIES FELL BELOW 20% AND THE AVERAGE WHOLESALE PRICE HAS JUMPED UP TO ALMOST 18% PER KILOWATT HOUR. WITH THE RECORDS WE HAVE RECEIVED IN THE BEGINNING OF 2023, THE HYDROPOWER PROJECTION HAS COME BACK UP TO 25% OF THE WHOLESALE ELECTRICITY PRICE FOR FISCAL YEAR 2023, 2024 IS ESTIMATED TO BE $0.14 PER KILOWATT HOUR. THE PRICE IS TRENDING DOWN A LITTLE BIT BUT NOT BY MUCH. THIS IS ALL BASED ON THE INFORMATION WESTMAN POWER ADMINISTRATION. PG&E HAS INCREASED THEIR RATES NOT ONCE, NOT TWICE BUT 14 TIMES FOR A TOTAL OF A 45% INCREASE ON RATES. AS IT SHOWS HERE, RATES GOT CHANGED AS OFTEN AS EVERY TWO MONTHS AND AS A COMPARISON, ISLAND ENERGY ONLY INCREASED OUR RATES ONE TIME DURING THE SAME PERIOD. WE THINK HOLDING THE ROADS STUDY IS VITAL TO IMPROVE THE QUALITY OF LIFE FOR RESIDENTS ON THEIR ISLAND AND TO BUSINESS DEVELOPMENTS ON THE ISLANDS, AS WELL. SO PEOPLE WOULD ASK , SINCE NOW THE HYDRO CONDITIONS HAS IMPROVED AND RATES HAVE GONE DOWN, WHY INCREASE RATES RIGHT NOW? SO LET'S TAKE A LOOK AT WHAT HAPPENED FINANCIALLY IN FISCAL YEAR 2022 AND 2023. SO WE DID HAVE THE HIGHEST UTILITY BILLING IN FISCAL YEAR 2022, 2023 DUE TO OUR HIGH SALES VOLUME BUT WE ALSO VARY THE LOWEST OPERATING MARGIN BECAUSE THE ENERGY PROCUREMENT AND TRANSMISSION COST TOOK UP MOST OF THE CELLS LARGER. SO, FOR SOME WINTER MONTHS SUCH AS JANUARY AND FEBRUARY OF 2023, THE ENERGY COST WERE AS HIGH AS $.23 PER KILOWATT HOUR. IT EXCEEDED THE TOTAL RATES WHICH WE CHARGE FOR RESIDENTIAL AND STREET LIGHTS. SO WE ARE SELLING THE LOW-COST FOR A FEW MONTHS. AND ALSO FOR HEALTHY UTILITY OPERATION, WE USUALLY NEED 14 OR $.15 PER KILOWATT HOUR TO PAY FOR LABOR , OPERATIONAL, ADMINISTRATIVE, REGULATORY AND VARIOUS OVERHEAD COSTS. AS WELL AS BUILDING FOR SYSTEM UPGRADES AND REPLACEMENTS AND WE DID NOT HAVE THE MARGIN TO COVER THE BASIC OPERATING COSTS IN 22 AND 23. AND WE HAVE BEEN DEFERRING MUCH NEEDED CAPITOL INVESTMENT ON OUR SYSTEM. THEREFORE, THE ADOPTIVE ELECTRIC RATES OF 2022 , 2023 ARE NO LONGER SUFFICIENT TO COVER ISLAND ENERGY OPERATING COSTS. SO HERE IS THE PIE CHART SHOWING WHERE WE SPEND OUR MONEY ON. SO ENERGY PROCUREMENT COSTS AND ALL OF THE RELATED RENEWABLE EXTENDERS AND ALL OF THE TRUST VISION COST , IT PICKS UP ABOUT 54% OF OUR OPERATING EXPENSE. STAFFING COSTS ACCOUNTS FOR ANOTHER 25% AND THAT INCLUDES TWO MANAGEMENT POSITIONS, ONE ADMINISTRATIVE POSITION FOR UTILITY TECH POSITIONS, AS WELL AS SOME OVERHEAD SHARING WITH PITTSBURG. SO IT IS NOT JUST ME , THEY ARE ACCOUNTING FOR THE 25%. SO THAT IS A 9% INCREASE FROM LAST YEAR 'S COSTS MAY NEED YOU TO ADJUSTMENT AND THE LABOR CONTRACT NEGOTIATION WITH IBW. SO, ADMINISTRATIVE AND GENERAL OVERHEAD HAS GONE UP 15% THIS YEAR COMPARED TO LAST YEAR. I LISTED A FAILED BIG-TICKET ITEM UNDER THIS CATEGORY. SO, LIABILITY AND PROPERTY ISSUANCE HAS DRUMMED UP 25% THIS YEAR BECAUSE ALMOST ALL INSURANCE COMPANIES ARE LOSING MONEY OVER MANY NATIONAL DISASTERS NATIONWIDE. SO