Board of Directors Workshop Meeting

Great Lakes Water Authority

Environment

Utilities

Wednesday, Sept. 13, 2023
1:00 p.m. — 3:00 p.m. EDT

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600 E Warren Avenue Detroit, MI 48201 (Directions)

Plymouth United Church of Christ

Meeting details

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Reporting

Edited and summarized by the Detroit - MI Documenters Team

Note-taking by Tiffany Pilson

GLWA's board discusses the need to revise budget estimates to account for the rising costs of labor and supplies.

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Live reporting by Bridget Scallen

GLWA's board discusses the high costs of deferred maintenance and the need to replace aging infrastructure.

Bridget Scallen

Hi Detroit! 🌊👋Today at 1pm I'll be live-tweeting the @glwatermi Board of Directors workshop meeting for @DetDocumenters #DetDocumenters. Our media partners are @BridgeDet313 @chalkbeatDET @freep @media_outlier @metrotimes @MichiganRadio @PlanetDetroit @wdet @wxyzdetroit.

10:59 AM Sep 13, 2023 CDT

Bridget Scallen @BridgetScallen 2/23

To tune-in or to download the agenda, please see this link. . glwater.legistar.com/MeetingDetail.…

glwater.legistar.com/MeetingDetail.…

Bridget Scallen @BridgetScallen 3/23

For past #DetDocumenters coverage of Great Lakes Water Authority meetings, such as Tim Kuhns, Director of Water Engineering, speaking on how GLWA oversees design & community water facilities all the way to the meter (6/28), please check out our archives: . detroit.documenters.org/assignments/gl…

detroit.documenters.org/assignments/gl…

Bridget Scallen @BridgetScallen 4/23

ICYMI, for August 26, national toilet paper day, @glwatermi reminded us to stick to three Ps when flushing: pee, poo, & paper. Other items can and do clog pipes in the home, office, sewer system, & pump stations. https://twitter.com/glwatermi/status/1695143363647783340

https://twitter.com/glwatermi/status/1695143363647783340

Bridget Scallen @BridgetScallen 5/23

@glwatermi Fats, grease, & oil that shouldn't be flushed down the toilet can accumulate to create a "fatberg," which is quite costly and disruptive to dismantle. The Science Center in Detroit has an exhibition on the Macomb County fatberg of 2018: . @wateratwayne freep.com/story/news/loc…

freep.com/story/news/loc…

Bridget Scallen @BridgetScallen 6/23

@glwatermi @wateratwayne Meeting is called to order at 1:04pm (Plymouth United Church). Board reaches quorum, approves agenda, approves minutes from last meeting.

Bridget Scallen @BridgetScallen 7/23

@glwatermi @wateratwayne The Board invites public comment. Three calls for public comment in the room or virtual. Public comment is closed with no public comment made.

Bridget Scallen @BridgetScallen 8/23

@glwatermi @wateratwayne Next up is the presentation: Budget and Charges Briefing by Nicolette Bateson, Chief Financial Officer/Treasurer. Formed economic outlook task force report last November w/ quarterly updates since then to audit committee. Forecast planning scenarios one feature of the reports.

Bridget Scallen @BridgetScallen 9/23

@glwatermi @wateratwayne Self-correction: Ben Fulton of Public Sector Consultants is giving the presentation, introduced by Nicolette Bateson. Executive summary: -Inflation has been major issue for everyone. But as expected "overall inflation and cost pressures are more stable this year than 2022."-

Bridget Scallen @BridgetScallen 10/23

@glwatermi @wateratwayne Executive summary continued: -"Inflation forecast suggests slightly lower annual inflation rate than last report." "Nationally a risk for recession remains elevated." -"Material prices are up from last spring, but not at the rate seen during the spike in 2020-2021."

Bridget Scallen @BridgetScallen 11/23

@glwatermi @wateratwayne Over 20 year trend, massive spike in 2021, leading into 2023. The graph on the right shows a drop since July 2022 into start of 2023; but start of 2023 brought a new rise back, and things have started to go down again. We're still way above the prices trend of the past 20 years.

Bridget Scallen @BridgetScallen 12/23

@glwatermi @wateratwayne Prices for priority materials such as iron and steel pipes and tubes, and chlorine, have increased (but iron & steel pipes and tubes prices declined recently).

Bridget Scallen @BridgetScallen 13/23

@glwatermi @wateratwayne Total wages compensation that increased in 2021, has fluctuated somewhat within the past year, is also a consideration.

Bridget Scallen @BridgetScallen 14/23

@glwatermi @wateratwayne Nicolette of the GLWA remarks they are looking at all scenarios through new lenses in the current environment. "We're recognizing the stress that the construction sector sees," continues to experience. GLWA is looking at packaging projects differently, supply chain is difficult.

Bridget Scallen @BridgetScallen 15/23

@glwatermi @wateratwayne Nicolette presents "Budget & Charges Briefing" to the GLWA Board of Directors. Here are slides 1 and slide 2.

Bridget Scallen @BridgetScallen 16/23

@glwatermi @wateratwayne Thanks for your patience. I am experiencing technical problems w/ phone toggling (wifi info provided did not match what's available).

Bridget Scallen @BridgetScallen 17/23

@glwatermi @wateratwayne In "Strategic Matters," Nicolette highlights GLWA is experiencing unprecedented budget constraints. Many contracts are 3- & 5-year contracts. Therefore sometimes there is delayed pop-up of costs. The GLWA has one more year of 4% promise (that budget increases no more than 4%).

Bridget Scallen @BridgetScallen 18/23

@glwatermi @wateratwayne Nicolette emphasizes GLWA has to look inward and outward, the economy, increased competition for low-cost SRF loans. Near-term issues to address include correcting over-delivery of 4% promise. A lot of this is focus on capital needs of system, level of deferred maintainance.

Bridget Scallen @BridgetScallen 19/23

@glwatermi @wateratwayne In recent history, GLWA did not have project managers to run projects. Now they do, and "we're doing what we're supposed to be doing," Nicolette says.

Bridget Scallen @BridgetScallen 20/23

@glwatermi @wateratwayne Nicolette explains it’s not uncommon for public utilities to deliver at 80% of their plan. We’ve gone from low delivery to on-pace delivery. Nicolette says GLWA is now mediation with Highland Park issue. Re: SRF, GLWA has received 50% of what they have applied for.

Bridget Scallen @BridgetScallen 21/23

@glwatermi @wateratwayne Nicolette and colleague Navid explain that many projects are 5- & 7-year projects, and that what tends to happen is contractor will do escalation and apply it to the middle of the year. A lot of these numbers are missing the mark, mostly in equipment (electrical & concrete).

Bridget Scallen @BridgetScallen 22/23

@glwatermi @wateratwayne A board member asks how these uncertainties are taken into account with the various estimations. Please see notes or transcript for GLWA response.

Bridget Scallen @BridgetScallen 23/23

@glwatermi @wateratwayne Another GLWA colleague, Bart, steps up and reminds, that the 4% Promise is the fixed total budget ceiling - not charges.

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Agency Information

Great Lakes Water Authority

www.glwater.org

See Documenters reporting

The Great Lakes Water Authority (GLWA) is a regional water and sewer authority that services nearly 40 percent of the water customers in Michigan. Currently GLWA provides wholesale water and waste water services to 127 municipalities in eight Southeastern Michigan counties, which is equivalent to approximately 3.9 million customers.