Unknown: you
Unknown: All right, we'll do a five-second morning
SPEAKER_10: Thank you.
Unknown: All right.
Unknown: Good evening and welcome to the Finance and Audit Committee and Special Board Meeting of June 16,
SPEAKER_10: 2026.
SPEAKER_10: This meeting is being recorded and can be accessed on SMUD's website.
SPEAKER_10: Please remember to unmute your microphone when speaking in order that our virtual attendees may hear.
SPEAKER_10: The microphone will display a green indicator light when the mic is on.
SPEAKER_10: For members of the public attending in person that wish to speak at this meeting, please fill out a speaker's request form located on the table outside this room and hand it to SMUD Security.
SPEAKER_10: Members of the public attending this meeting virtually that wish to provide verbal comments during the committee meeting may do so by using the raise hand feature in Zoom at the time public comment is called.
SPEAKER_10: Technical support staff will enable the audio for you when your name is announced during the public comment period.
SPEAKER_10: You may also submit written comments by emailing them to publiccommentatsmud.org.
SPEAKER_10: Writing comments will not be read into the record but will be provided to the board electronically and placed into the record of the meeting if received within two hours after the meeting ends.
SPEAKER_10: Would the Chief Legal Officer please collect a roll call?
SPEAKER_10: Dr. Kurth?
SPEAKER_08: Here.
Unknown: Dr. Bowie-Thompson?
SPEAKER_08: Present.
Unknown: Chair Rose?
SPEAKER_08: I'm here.
SPEAKER_08: All committee members are present.
SPEAKER_08: Also present are Directors Fishman, Herber, Sanborn, and present Tamayo.
SPEAKER_08: All right. Thank you.
SPEAKER_10: Item 1 on tonight's agenda is to discuss authorizing the CEO and General Manager to negotiate an award contract to NB5 Geospatial Inc. for light detecting detection and ranging LIDAR, remote sensing, and data analytics.
SPEAKER_10: I will turn this over to Luke Israeli, our Director of Line Assets.
SPEAKER_10: Thanks, Chair Rose, for that introduction.
SPEAKER_01: I can thank the rest of the Board of Directors.
Unknown: I apologize.
SPEAKER_01: So LIDAR has proven to be a very valuable tool in the vegetation management toolbox, and it's helped our team provide safe and reliable electricity for our community.
SPEAKER_01: Over the next few slides, I'll talk about what LIDAR is, the benefits that we've realized utilizing this technology, and where else in the organization LIDAR is valuable.
SPEAKER_01: Also, I'll touch on some additional services that this contract provides.
Unknown: So LIDAR is a remote sensing technology that uses laser pulses to measure distances and create a precise 3D representations of objects and features.
SPEAKER_01: Basically, it gives us measurements of vegetation in relation to our overhead facilities.
SPEAKER_01: The vegetation management team has conducted a lot of testing and validation of this technology, and we found it to be very accurate, up to 6 to 10 centimeters of accuracy.
SPEAKER_01: Very, very accurate technology.
SPEAKER_01: This technology has been programmatically supporting SMUD since 2017.
SPEAKER_01: In 2017, a professional services contract was presented to the Board.
SPEAKER_01: It was awarded for a five-year term.
SPEAKER_01: The annual spend on that contract was less than originally planned, which gave the business the ability to extend the contract a few times.
Unknown: But now we're at the point we need to go back out to market for this RFP.
SPEAKER_01: So some benefits that we've realized since 2017.
SPEAKER_01: This has been a highly accurate tool, 6 to 10 centimeter accuracy.
SPEAKER_01: This is used on transmission and distribution vegetation management patrols, and it has provided system reliability, public safety, and enhanced programmatic efficiencies.
SPEAKER_01: It has also improved employee safety, and reduction in customer impacts as locations without LIDAR detections do not need to be impacted with an arborist visit.
SPEAKER_01: So this is less customer interactions, less doors we need to knock on, less potential dogs and backyards we need to deal with.
SPEAKER_01: So for example, in 2025, of the roughly 1,500 line miles that we use this technology on, 410 of those miles in the distribution assets were identified as LIDAR clear.
SPEAKER_01: So like I said, this has provided employee safety as well as public safety and enhanced programmatic efficiencies.
SPEAKER_01: LIDAR has become an industry standard and a best management practice for vegetation management programs.
SPEAKER_01: It's also recommended by WEC for vegetation management programs.
SPEAKER_01: This has given us the ability, LIDAR has given us the ability to prioritize our work by risks and conditions, not using a traditional time-based inspection model, which has provided many benefits.
SPEAKER_01: So this is an enterprise-wide technology.
SPEAKER_01: Obviously, we use it in the transmission and distribution vegetation management patrols, but this technology also supports a UART-qualified mitigation work.
SPEAKER_01: This is also used for the MUD annual insurance meetings.
SPEAKER_01: It's information for NERC regulatory evidence if needed.
SPEAKER_01: This also supports transmission engineering assessments, gas pipeline inspection of encroachments, and is also used for new siting for construction and line builds and for substations.
SPEAKER_01: Some additional services that are in this contract are aerial orthographic imagery.
SPEAKER_01: This is gathered with a fourth infrared band.
SPEAKER_01: This is capable of identifying stressed, dead, or dying vegetation risk.
SPEAKER_01: We use this mainly in the UART.
Unknown: And this data gives the vegetation management team the ability to dispatch arborists to these locations to mitigate these potential risks in the system rather than catching these risks on a traditional time-based model.
SPEAKER_01: Oblique imagery is high-quality 36-megapixel imagery.
SPEAKER_01: So if orthographic imagery is images of the trees, this oblique imagery would be images of our SMUD assets.
SPEAKER_01: So think transmission towers, poles, conductors, conductor heights.
SPEAKER_01: So we use these images for engineering assessments.
SPEAKER_01: Satellite remote sensing.
SPEAKER_01: This is satellite-based measurements, similar to LIDAR, but captured with the satellite.
Unknown: This technology is still evolving.
SPEAKER_01: And it's not quite to the accuracy levels we're comfortable with, but we wanted it in this RFP as the technology advances.
SPEAKER_01: It could be a very valuable tool to get more snapshots of our current conditions on our system.
SPEAKER_01: Unmanned aerial systems or drones that can capture LIDAR data.
SPEAKER_01: So you can think of this as like a site-specific location if we have a piece of land that we want to build a substation on or we want to grab data for a smaller area.
SPEAKER_01: We won't have to dispatch a winged aircraft to grab this data.
SPEAKER_01: It'd be much more efficient and cost-effective.
SPEAKER_01: So this RFP was released in December of 2025 to solicit proposals from qualified firms.
SPEAKER_01: SMUD received seven proposals.
SPEAKER_01: Three of the seven proposers satisfied SMUD's mandatory requirements and minimum point threshold for commercial evaluation.
SPEAKER_01: Those three companies were Utility Tree Service, Geo Digital International, and NV5 Geospatial.
SPEAKER_01: NV5 Geospatial was the highest ranked proposer in technical and commercial evaluations with a total score of 12 points higher than the second place proposer.
SPEAKER_01: NV5 Geospatial will also utilize 20% seed subcontracting in the performance of these services.
Unknown: And with that, that's my presentation.
SPEAKER_01: I'd like to open it up for any questions.
Unknown: Questions?
SPEAKER_06: Yeah.
SPEAKER_06: Hi, Lucas. Good to see you.
SPEAKER_06: So we're going to contract it.
SPEAKER_06: So it's just the first contractor, even though three qualified, that's the one that's...
SPEAKER_06: Yeah. We want to award to NV5 Geospatial.
Unknown: The second? Yeah. Just the one.
SPEAKER_06: Okay.
SPEAKER_06: Recently we've been giving it to like clusters of contractors to do different works.
SPEAKER_06: I just want to make sure because I wasn't thrilled with that last one there, the Utility Tree Service scores.
SPEAKER_06: Okay. Good. So that's one question.
SPEAKER_06: So they're going to be providing to us services where they fly over with drones and they take pictures of our lines.
SPEAKER_06: They tell us what's going on with that accuracy.
SPEAKER_06: And then you can go out and determine we've got a problem, we'll have a problem in a few months, or next year so you can be much more cost effective and efficient.
SPEAKER_06: Yeah. That's a good question.
SPEAKER_01: I probably wasn't clear.
SPEAKER_01: When we capture the LIDAR data, we use a fixed-wing aircraft and we fly our UARP and our transmission assets every year and then our distribution assets every other year.
SPEAKER_01: The other services that if needed, these are available.
SPEAKER_01: So when we fly the UARP, we're using orthographic imagery every time.
SPEAKER_01: Oblique imagery would be taken with a fixed-wing aircraft if requested by engineering for our transmission or our assets.
SPEAKER_01: And then if needed, a drone would be used for a site-specific type all within this one contract.
SPEAKER_01: But the LIDAR is gathered using a fixed-wing aircraft flying over our lines.
SPEAKER_01: That's what I wasn't sure. Okay.
Unknown: Well, people love this stuff, and I think the more technology we can use to keep our lines clear and people safe and all those things, I just think this is wonderful.
SPEAKER_06: So I appreciate you doing it and look forward to the next contractor and I'll support it. Thanks.
Unknown: Yeah, thank you.
Unknown: Perfect. Are there any other comments or questions?
SPEAKER_10: I don't see any. Are there any online?
Unknown: No, there's not.
SPEAKER_07: All right. Thank you, Lucas.
SPEAKER_10: Thank you.
Unknown: Okay.
SPEAKER_10: Item number two is to discuss authorizing the CEO and General Manager to negotiate and award contracts to AE Comptechnical Services, Kleinfelder, Inc.,
SPEAKER_10: Geosyntech Consultants, Parsons Transportation Group, Inc., and Brown and Caldwell.
SPEAKER_10: Collectively call the contracts for on-call remediation and environmental services for the five-year period from July 1, 2026 to June 30, 2031,
SPEAKER_10: with one optional three-year extension for a total aggregate not to exceed an amount of $35 million across the contracts.
SPEAKER_10: We have Emily Bikini, our Director of Safety, Environmental, and Real Estate Services. Welcome.
SPEAKER_10: Great. Thank you.
SPEAKER_11: Good evening. My name is Emily Bikini, and I'm the Director of Safety, Environmental, and Real Estate Services,
SPEAKER_11: and I'm here tonight to ask you all to authorize our General Manager to approve the five contracts or contracts with the five firms that are listed on this slide and on this slide.
SPEAKER_11: This contract would support remediation efforts along with other environmental support that the team would need.
Unknown: It is a five-year contract with an option to extend three years and an aggregate not to exceed amount of $35 million.
Unknown: Some of the tasks that would be supported by this contractor are shown here on the slide.
SPEAKER_11: I'm not going to talk through all of them, but I did want to reference a few of them and provide a little color around how we use these contracts.
SPEAKER_11: For example, site assessments are prepared any time prior to purchasing or selling a property.
SPEAKER_11: We were able to purchase our Station J property a couple of years ago and did a site assessment prior,
SPEAKER_11: and were able to find out that there had been some historical soil contamination.
SPEAKER_11: So we were aware of that prior to our purchase, and we could plan accordingly for the construction when we got to that stage.
SPEAKER_11: With that same project, a contract like this would allow us to remove the contaminated soil
SPEAKER_11: and ensure that it was managed appropriately and disposed of appropriately.
SPEAKER_11: This contract would also support work, for example, associated with our 59th Street property,
SPEAKER_11: where we were able to demolish the buildings on the property,
SPEAKER_11: and then also any remediation or cleanup efforts that were needed.
SPEAKER_11: For our procurement process, we reached out to 43 contractors who were interested in the procurement.
Unknown: The RFP was released in early February, and we had a pre-proposal conference on February 17th.
Unknown: Twelve firms attended that pre-bid meeting, and then we received 15 proposals altogether.
Unknown: We evaluated the proposals based off of their seed contracts or their seed participation, environmental sustainability,
SPEAKER_11: contractor safety, experience and qualifications of their personnel and of their firm,
Unknown: and their ability to respond to our needs along with other areas.
SPEAKER_11: And then ultimately decided on issuing the award to the top five firms, as shown on this slide.
SPEAKER_11: The projects would be... there would be a task RFP released for projects,
SPEAKER_11: so they would be able to competitively bid between the five firms.
SPEAKER_11: And based off of our existing contracts, we wanted to make sure we had enough variety
SPEAKER_11: so that when our workload gets heavy, we can have the contractor support that we need.
Unknown: And that completes my presentation. Any questions?
Unknown: I don't have any questions. Are there any questions?
SPEAKER_10: Yeah.
Unknown: I was just curious as the landfill engineering services, where do we use that?
SPEAKER_05: Is that like where we're citing something where there used to be landfill or what?
SPEAKER_05: Exactly. So, for example, our North City substation was located on a landfill,
SPEAKER_11: and we had to prepare a landfill plan for that site when we decommissioned it.
SPEAKER_11: If we need to go out and replace the towers or the poles that cross that property,
SPEAKER_11: we would be able to rely on these firms to support that effort.
Unknown: All right. I don't see any other comments. Are there any online comments?
SPEAKER_10: No, there's not.
Unknown: All right. Thank you.
Unknown: So, item number three is to discuss approving the issuance of SMUD 2026 series P electric revenue bonds
SPEAKER_10: and SMUD 2026 series Gs, subordinated electric revenue bonds,
SPEAKER_10: authorized the distribution of the preliminary official statement,
SPEAKER_10: and authorized the CEO and general manager to execute documents necessary to complete the transaction or transactions,
SPEAKER_10: including the bond, personal agreement, or agreements.
SPEAKER_10: All right. We have our director of Treasury and Revenue Strategy, Jennifer Restiva.
Unknown: Thanks, Director Res, for reading all of that. I know it's a mouthful.
SPEAKER_02: Good evening. I'm Jennifer Restiva, director of Treasury and Revenue Strategy,
SPEAKER_02: and I'm here tonight to ask the board to approve issuing $250 million in bonds, in green bonds, actually.
SPEAKER_02: So, this will fund our capital needs, boost our liquidity, and refine $50 million of green commercial paper that we issued in May.
Unknown: We'll be issuing $125 million in put bonds and $125 million in long-term fixed rate bonds.
SPEAKER_02: This financing is part of our broader approach to making sure that we have the resources we need to invest in the system,
SPEAKER_02: serve our customers reliably, and maintain our financial strength over time.
Unknown: Reliable service depends on us having enough cash to meet our obligations,
SPEAKER_02: and so we manage that liquidity with our customer revenues, disciplined capital planning,
SPEAKER_02: and making sure that we have access to the correct capital markets.
SPEAKER_02: So, our goal is to maintain 150 days cash, which helps us stay financially flexible and prepared for changing conditions.
Unknown: We use both short-term and long-term borrowing as part of a balanced financial strategy,
SPEAKER_02: so short-term borrowing gives us flexibility and can be arranged quickly when timing matters.
SPEAKER_02: You can issue commercial paper in as quickly as three days.
SPEAKER_02: Issuing bonds takes about three months, so it's a big difference there.
SPEAKER_02: And then long-term borrowing allows us to fund long-lived assets over time,
SPEAKER_02: which is more aligned with how our customers benefit from those investments.
Unknown: We're proposing both put bonds and fixed rate bonds because each serves a different purpose in our overall financing strategy.
SPEAKER_02: Our put bonds give us a lower borrowing cost and added flexibility.
SPEAKER_02: They're a good fit. We want to take advantage of current market conditions.
SPEAKER_02: The trade-off is they do introduce future refinancing risk, which we manage carefully.
Unknown: And we use the subordinate lien for those put bonds because it gives us clarity,
SPEAKER_02: because they're a little bit more complex of a financial product.
SPEAKER_02: Fixed rate bonds give us long-term certainty and predictable debt service.
SPEAKER_02: They lock in our current rates and reduce our exposure to future market changes.
SPEAKER_02: They're similar to a mortgage in that the total payment structure is designed to stay steady over time.
SPEAKER_02: The senior lien is for fixed rate bonds because they're simpler and it minimizes our interest expense.
SPEAKER_02: So these two structures together give us a balanced approach that supports both our near-term savings and our long-term stability.
Unknown: This issuance is consistent with our financial strategy and our long-standing approach to responsible capital planning.
SPEAKER_02: Our target remains that we fund 60% of our capital through customer revenues and 40% through bond issuances.
SPEAKER_02: We've evaluated the impact of this transaction against our budget assumptions, which assumed that we would borrow $260 million.
SPEAKER_02: Our budget authorization was for up to $400 million of issuance if we needed it.
SPEAKER_02: And this financing supports reimbursement of our prior capital spending and gives us some flexibility in 2027 for when we do our financing then.
Unknown: So strong credit ratings are especially important when we go to the bond market.
SPEAKER_02: We were recently taken off of negative outlook by Standard & Poor's or S&P, which is a really positive sign for SMUD.
SPEAKER_02: And our double A rating helps lower our borrowing costs and supports continued access to capital at favorable rates.
SPEAKER_02: And maintaining strong credit is an important part of protecting our customer value and keeping our financing costs as low as possible.
Unknown: We're issuing both components of this transaction as green bonds, which aligns with our sustainability goals and zero carbon commitment.
SPEAKER_02: The green designation reflects the kind of investments that we're making and helps support investor interest in SMUD's work.
SPEAKER_02: It also broadens the investor base, so including California investors and investors seeking environmentally focused municipal debt.
SPEAKER_02: And the commercial paper that we're refunding was also green, and you may remember that last year we were one of the first issuers of green commercial paper.
Unknown: So I think everyone knows the market's a little volatile right now, and so timing of this transaction does matter.
SPEAKER_02: We're moving forward now, which will give us the opportunity to secure financing before conditions change further.
Unknown: Fixed rate debt will allow us to lock in cost and support rate stability for our customers.
Unknown: Our current true interest cost is just below 3% for this transaction.
SPEAKER_02: Obviously, the market does change and we're monitoring it daily.
SPEAKER_02: And the total cost to issuance is approximately a million dollars, which is under what we had planned in the budget.
Unknown: So the official statement and the related documents have been provided to the board for review.
SPEAKER_02: I know it's a lot to read.
SPEAKER_02: There's some proposed amendments in there which are favorable to SMUD, and all of our existing bondholders have already consented to those.
SPEAKER_02: And so board approval will allow us to finalize the resolution and complete the transaction.
SPEAKER_02: So I know you may be wondering how our customers can participate in this bond deal.
SPEAKER_02: So we've structured this offering to support retail investors, and so retail investors is a fancy word for meaning individual investors.
SPEAKER_02: So not large institutions, that could be SMUD customers, local residents, or anyone with an investment account at any of these firms.
SPEAKER_02: So we have several banks working as underwriters to provide broad access to this transaction.
SPEAKER_02: The retail order period will give retail investors from California priority.
SPEAKER_02: So we will make sure that their orders are filled.
SPEAKER_02: And investors can place orders through brokers or online platforms on or before the morning of pricing on June 30th.
Unknown: So in summary, this financing helps us maintain our strong liquidity, supports our capital program, and manages our borrowing costs responsibly.
SPEAKER_02: The structure balances flexibility with long-term stability, supports our credit strength, and aligns with our sustainability goals.
SPEAKER_02: And we're asking for the board to approve this so we can move forward under current market conditions and continue delivering long-term value to our customers.
SPEAKER_02: This ends my presentation. Are there any questions?
Unknown: Well, I just want to say that I love it.
SPEAKER_03: I love the green bonds. And I'm glad we're pursuing that. So thank you.
Unknown: I, of course, would ditto that. But also, I just really want the public to know that they can buy these bonds and invest in their own greening of their own utility.
SPEAKER_06: And so I guess I just pose to staff, it'd be nice to know how we're going to promote these to make sure as many.
SPEAKER_06: I literally had somebody ask me last week, so what's this new thing that someone might be doing in releasing the bonds?
SPEAKER_06: And I'm like, I don't know. I don't know when we're going to promote it. I don't know how we're going to do it.
SPEAKER_06: So that's a question I have for staff. Maybe you could get back to us on that.
SPEAKER_06: Because I think people really want to help us, and this is something they can use as a good investment. Thank you.
SPEAKER_06: Come back.
Unknown: Do you have maybe a little bit of commentary of how these are going to be proportionate between the short and long term amount?
SPEAKER_10: So the $125 million will be the put bonds, and those will be a 2033 put date. And the rest will, the other $125 million will be long term.
SPEAKER_10: Okay. All right. Any other questions or comments?
SPEAKER_10: Good. Thank you. I know Jennifer has been at multiple conferences in the past few months. So up to speed. Anybody online?
Unknown: No, there's not.
SPEAKER_07: All right. Thank you.
SPEAKER_10: This will be an item on discussion.
SPEAKER_07: Yeah.
Unknown: All right.
Unknown: And item number four is our quarterly procurement report. We have Casey Fallon, our director of procurement warehouse and fleets. Welcome.
Unknown: Okay. Good evening. Thank you for the introduction. This is just the usual procurement quarterly report.
SPEAKER_09: Just demonstrating the outcomes in compliance with the board staff linkage policy BL8. To start out with, total awarded contracts for the first quarter, $123 million.
SPEAKER_09: The makeup of that is $47 million in professional services. You've heard about several of those in prior meetings. Hydroelectric engineering, geotechnical engineering, IT services, training services,
SPEAKER_09: training contracts. We also had $40 million in construction, $20 million in materials and equipment. Some fleet vehicle purchases in there.
SPEAKER_09: And then $17 million in total IT purchases. Of the total, 86% were awarded competitively. We had $3.6 million in exempt contracts. Those are very small purchases,
SPEAKER_09: 344 individual purchases on average a couple thousand dollars. There was $12 million of sole source. The biggest component of that was power cost sync proprietary data platform that was about $11 million.
SPEAKER_09: And then less than $1 million in direct procurement. That was actually just one contract for about $100,000 for a consulting service agreement.
Unknown: This slide summarizes participation in the first quarter. Staff hosted 15 individual bidding events on average 6.2 bidders.
Unknown: This is a great trend. This is continued up and to the right over the years. Really the credit goes to the staff and our procurement manager Robert Adams just making a really great decision to move to a new bidding platform.
SPEAKER_09: This is demonstrating higher participation, more competition and a sign of easier supplier access to our bidding events. So kudos to staff. Great results there.
Unknown: In the first quarter we're exceeding the 20% seed goal. We're at 37% for the quarter. So great start to the year. The total is $31.5 million in new contracts. Of that total, $4 million in subcontracting and $27.5 million directly to seed primes.
SPEAKER_09: So the majority share there to primes. There are six prime contracts in that total and 12 separate contracts with seed subcontracting.
Unknown: Nothing new this quarter on the seed compliance. So this is the same result from the prior report.
SPEAKER_09: 82 contracts closed over the past 10 years with 75% compliance on average. But I would like to report that staff has two really positive developments in the works that will show future improvements here.
SPEAKER_09: The first one being under the new leadership under Joe Schofield, he's taken on the procurement group. He's worked really closely with staff to develop ranges for subcontracting by commercially useful function that we're publishing with our bidding.
SPEAKER_09: So for example, if it's a civil construction contract, we'll have a range for sand and gravel, grading, surveying, so on and so forth based on the prior actual contracts. So we get some real accuracy in what's coming in in the bidding commitments.
SPEAKER_09: So that's part one. And part two, staff is now reviewing and auditing seed subcontracting proactively from the start of contracts to ensure the spend more closely tracks the commitments throughout the life of the contract rather than just at the end here.
SPEAKER_09: So those should really help demonstrate good results in the future.
SPEAKER_09: We had no protests in Q1, so that formally wraps the report. And I did have just one final comment, but maybe I'll pause for questions.
Unknown: Director Herber and then Director Stenbrough.
SPEAKER_03: Actually, it's not a question as much as some praise. Good job. This is a really wonderful report. I know the last time you were here, you kind of got a little broiled. And I just want to make sure you feel the love today.
SPEAKER_03: Thank you. I do. Thank you very much.
SPEAKER_06: Thank you. Yeah, I was actually going to thank you for the work that you and Joe have been working on on the auditing because that really is important, at least to me.
SPEAKER_06: And I want to thank you for doing that because we really do want to make sure we get as much money back in this community as we possibly can and help our community grow and be economically thriving. So thank you.
SPEAKER_00: Casey, I'm sorry. I'm kind of disappointed. No protests in Q1? Come on.
SPEAKER_00: You're going to try a little harder. No, I'm kidding. Thank you.
SPEAKER_10: Any other comments or questions? All right. Good report. Is there any online comment?
Unknown: There's no online comment.
SPEAKER_10: All right. Thank you. We'll call it there. Just one final comment. This is my final procurement report. I did mention the group is transitioning over to Joe. Obviously, he's off to a great start with the seed compliance work. All the credit to him.
SPEAKER_09: I've been doing this report for 11 years, four times a year since 2015, just about, you know, plus or minus if you so about 40 reports. And you know, I'm a real data person. I might put a different label to that, but I'll just throw some numbers at you. I thought this was fun.
SPEAKER_09: That's over that time period, about 1500 new contract awards and the total value of close to $6 billion. So just thought I'd throw that out there. Really proud of the output from the staff. And it was just a great experience working with everybody. And the last thing I just wanted to thank all of you for the patience with me. The great questions, the dialogue and support along the way. Really appreciate the trust in me to perform the role. And it's been my absolute pleasure.
SPEAKER_09: And I'll continue to work with Joe and the team as needed. So thank you so much. Last procurement report. Done.
Unknown: President Spina. Yeah. And Casey, I just also wanted to point out, sorry to step on your mic drop there, but
SPEAKER_05: there was a patch where we were getting very few bids on things. And I know that you and your staff sort of drilled down into, you know, why is that occurring? And you've done a great job of making all the bidding more competitive. So thanks for figuring out what the barriers were and dealing with it.
SPEAKER_05: And your slide here shows pretty good progress. So thank you very much for that. Yeah, thanks. Thanks to staff. All the credit goes to them. Thank you.
Unknown: All right. So we'll jump to item number five. This is a report of Smud's financial results for the four month period and April 30th, 2026. And a summary of Smud's current supply costs. And our presenter is our director of accounting and control.
SPEAKER_10: And our presenter is our accounting and controller, George Spunt. Welcome. Thank you, Director Rose. He's starting out in his many years. I was just going to say, if I do this for 11 years, I've got 132 of these to look forward to. So I'm excited.
SPEAKER_04: So, but thank you, Director Rose and Smud Board of Directors. We'll start with April year to date financial highlights. Customer revenues is $508 million.
Unknown: And that's not a misprint. It is zero million variance and 0.00 lower than budgeted. Rounded, of course. That's rounded. I'm not saying we're to the penny. And this is we're a little bit under in residential sales, a little bit over in commercial, but essentially right on plan.
Unknown: Commodity expenses is $162 million, which is 11 million less than plan, largely driven by a couple of things. It's due to the market economics, we're doing a little bit less thermal generation, which results in lower fuel cost.
Unknown: And then on top of that, market power prices are running lower right now. Other operating expenses is $339 million, $10 million lower than budget. This is driven by some essentially project timing variances across a couple of our business units, as well as we're a little bit under on vegetation management and substation.
SPEAKER_04: So those groups are running efficiently. This all leads to $36 million in net income, which is $42 million higher than our planned net income, which at this time was supposed to be $6 million to the negative.
SPEAKER_04: Energy sources. So we'll start with the chart on the left, which is the month of April. Hydro is a little bit under. It has been the last few months. That's, again, driven by a low precipitation, low snowpack.
Unknown: If you look at the orange and the green, the orange is thermal, the green is purchase power. Thermal is under, purchase power is over. Those largely offset each other, and it's driven primarily by the same factor, which is lower market power prices, which make it more economical to buy power than to generate thermal power.
Unknown: If you look at the April year to date on the right, those same explanations hold up for thermal and for purchase power. Hydro generation is right on plan year to date, or 699 actual versus 696 gigawatt hours.
Unknown: Delinquency. You can see the nice downward trend starting in October, going all the way to April. We're at $23 million right now as of April 30th, which is a $4 million reduction from last month. Of that total, a couple of numbers on that, about 70% of it is residential and EPR, and about $8.4 million of this is on payment plans.
Unknown: Precipitation is 51 inches. This is literally the same number that I shared last month, and obviously it's been a dry month now. It's 92% of average to date and about 90% of the entire water year average.
SPEAKER_04: Snowpack is extremely low, 1.6% of average at our various sensors. I checked yesterday, and it's at 2%, so hasn't changed much on that. But the storage reservoirs are at 97% of capacity, which speaks well for kind of the later months in the summer.
SPEAKER_04: Commodity budget. I won't really talk about the chart on the left. That's been final for the last couple of months. Nothing has changed on that. Our commodity forecast is coming in at $609 million versus a budget of $593 million. That difference of $16 million is largely driven by a lower hydro forecast.
SPEAKER_04: Last month, I showed it being about 400 gigawatt hours under, and then some market conditions changed, and now it's a little bit closer to plan. But nevertheless, by coming in under on hydro, that causes us to need to then either procure or generate more expensive commodities. Thus, we're coming in at 16 over at the end of the year.
SPEAKER_04: And then you can see the hydro forecast at the bottom there, 101 gigawatt hours under plan, which is about 4%.
Unknown: Days cash on hand. As Jennifer said earlier, we're going to be borrowing $250 million. So there's a few different numbers you'll hear. The budget was set at $260. What you see up here was as of April 30th, and so we were assuming we were only going to borrow $200 million at that time.
Unknown: So this is based on the $200 million borrowing assumption. Next month, I'll reflect the $250 that Jennifer shared. But as of April 30th, we're right on plan at April, so 179 days versus 178. Then at the end of the year, I projected at $180 versus $211 on the plan.
SPEAKER_04: Again, that's the difference between $200 million of cash versus the $260 that was in the budget. With that said, I can take any questions.
Unknown: Are there any questions or comments? I don't see any.
Unknown: Everybody gets all of my questions and comments in the pre-briefs, which probably saves us 15 minutes of meetings. Are there any online comments related to this item?
SPEAKER_10: No, there's not.
Unknown: Are we aware of any comments on items not on the agenda?
SPEAKER_10: No.
Unknown: I think we have at least one committee direction summary.
SPEAKER_10: Yes. Staff will provide the board with information on how we will promote the bonds to the retail market.
SPEAKER_07: Sounds good. Okay. Then with that, with the agenda, we will be adjourned. Thank you.
Unknown: Thank you.