Seattle City Council Economic Development, Technology & City Light Committee 6/22/22

It is 9.31 and I'm Sarah Nelson, chair of the committee and Taman Um is our clerk today.

Will the clerk please call the roll.

Council member Sawant.

Present.

Council member Herbold.

Council president Juarez.

Here.

Chair Nelson.

Present.

Three present.

Thank you, Taman.

For the record, Council Member Dan Strauss is excused from today's meeting.

So I am excited to have our first meeting in person in chambers today.

While I recognize that we're still dealing with the pandemic, frontline workers have been on the job in person, keeping the city government and the city as a whole running.

And we're public servants, and I believe that the public is best served with in-person meetings because they facilitate a more free-flowing conversation and the public can see our interactions.

I'll be looking for visual cues from my council members and presenters at the table.

So if I don't see you on the screen, please just speak up.

Let's see, public meetings are also important in person because it gives reporters more immediate access, and I'm sure they'll be flocking to my meetings in the future.

All that said, we have a hybrid model to accommodate vulnerable people and to accommodate people who are traveling.

So I ask for your grace as we drive this technology for the first time.

There are three items on today's agenda.

The first is a presentation on the Office of Economic Development's priorities for an equitable recovery and inclusive economy under their new interim director, Mark McIntyre.

The second is our first discussion of Seattle City Light's 2023 to 2028 strategic plan and rate path.

And the third is a discussion and possible vote on an ordinance authorizing City Light to execute an agreement with the Skagit Environmental Endowment Commission, here forth referred to as SEEK.

to, let's see, to convey funds received from the State of Washington Department of Commerce and City Light funds to protect the Skagit watershed.

Now, first I have a public service announcement from our utilities.

As City Light and Seattle Public Utilities work to inform customers about resources available to help with utility bills, there has been an increase in scam reports of people posing as representatives of the city.

Seattle City Light and Seattle Public Utilities will not call customers to demand immediate payment or personal information.

And if someone calls demanding payment rather than working with you to establish a payment plan, that is a scam.

Customers who believe they've been contacted by a scammer should call 206-684-3000 to verify their account.

All right, moving on to the agenda, if there's no objection, Objection, the agenda will be adopted.

Hearing no objection, the agenda is adopted.

We'll now move on to public comment on the items listed on the agenda.

Let's see.

Yes.

Council Member Herbold has joined the committee.

Welcome Council Member Herbold.

Okay, we're ready for the new video.

Seattle City Council welcomes remote public comment and is eager to hear from residents of our city.

If you would like to be a speaker and provide a verbal public comment, you may register two hours prior to the meeting via the Seattle City Council website.

Here's some information about the public comment proceedings.

Speakers are called upon in the order in which they registered on the Council's website.

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A reminder, the speaker meeting ID is different from the general listen line meeting ID provided on the agenda.

Once a speaker's name is called, the speaker's microphone will be unmuted and an automatic prompt will say, the host would like you to unmute your microphone.

That is your cue that it's your turn to speak.

At that time, you must press star six.

You will then hear a prompt of, you are unmuted.

Be sure your phone is unmuted on your end so that you will be heard.

As a speaker, you should begin by stating your name and the item that you are addressing.

A chime will sound when 10 seconds are left in your allotted time as a gentle reminder to wrap up your public comments.

At the end of the allotted time, your microphone will be muted and the next speaker registered will be called.

Once speakers have completed providing public comment, please disconnect from the public comment line and join us by following the meeting via Seattle Channel Broadcast or through the listening line option listed on the agenda.

The council reserves the right to eliminate public comment if the system is being abused.

or if the process impedes the Council's ability to conduct its business on behalf of residents of the City.

Any offensive language that is disruptive to these proceedings or that is not focused on an appropriate topic as specified in Council rules may lead to the speaker being muted by the presiding officer.

Our hope is to provide an opportunity for productive discussions that will assist our orderly consideration of issues before the Council.

The public comment period is now open, and we will begin with the first speaker on the list.

Please remember to press star six after you hear the prompt of, you have been unmuted.

Thank you, Seattle.

All right, we will start with remote commenters.

Please state your name and the item to which you are speaking.

And if you haven't registered to speak, you can still sign up using the link on the agenda before the public comment period has concluded.

And for in-person comment, please sign up on the signup sheet located near the podium in the Seattle Chambers right here.

All right, let's see.

Our first speaker, I believe, is Tom Uniak.

and people will have two minutes to speak.

Great, thanks.

Can you hear me?

Yes.

Okay, well, hello, my name is Tom Uniak and I'm the Executive Director of Washington Wild, a statewide nonprofit that has been dedicated to protecting Washington's wild lands and waters since 1979. I'm excited to testify today in support of funding as part of an historic agreement made by the British Columbia government, the state of Washington, the city of Seattle, the Nature Conservancy of Canada, Imperial Metals, and the Skagit Environmental Endowment Commission to relinquish mineral tenures in the headwaters of the iconic Skagit River.

Washington Wild spends nearly all of its efforts working on issues in Washington State, but logging and mining threats in the headwaters of the Skagit River would impact downstream values like salmon and orca recovery, clean and safe drinking water, tribal treaty rights, and lifeways and the health of Puget Sound.

That's why we organized an international coalition four years ago opposing mining and logging in the Skagit headwaters, which started with less than a dozen organizations and grew to nearly 300 tribes, First Nations, outdoor industry leaders, local businesses, hunting and fishing groups, elected officials, and conservation organizations on both sides of the border.

And that list included a majority of the Seattle City Council members.

Thank you for your support, as well as the Chairwoman.

The Skagit River starts in British Columbia, but quickly flows south into Washington State through North Cascades National Park, Skagit Wild and Scenic River, the Mount Baker Snoqualmie National Forest, and through the renowned Skagit Valley.

The Skagit River provides one-third of the freshwater inputs to the Puget Sound and supports the largest populations of threatened steelhead and Chinook salmon in the region.

With partners including the upper Skagit and Swinomish tribes, Seattle City Light, National Parks Conservation Association, Conservation Northwest, and Skagit Audubon, we cheered the announcement in 2019 that clear-cut logging would be halted in headwaters.

We cheered even louder when the news of the agreement came ending the existing mining claims.

The coalition continues to work to ensure that permanent protections are established in the Skagit headwaters to prohibit new mining claims and log-in threats and to clean up leftover mining waste and debris.

Thank you for this opportunity to testify on this important issue.

Thank you very much.

I see no one else signed up on our remote list and it doesn't appear that there is anybody to speak in person.

All right, so that concludes our public comment period.

Will the clerk please call, read item one into the record and the presenter to come to the table.

Agenda item one, presentation on office of economic developments, departmental structure and overview for briefing and discussion.

Okay, I'm not gonna lie, I've been looking forward to this presentation for a long time while Interim Director McIntyre has been doing a deep dive on OED's existing work plan and its staffing capacity and new emphases and priorities.

So Director McIntyre, please take it away.

Thanks, Council Member Nelson.

Is my mic working?

It sounds like it is, great.

It is fun to be back here in council chambers.

Thanks for having us.

Welcome to the council members of the dais and then welcome to the council members online in a hybrid format.

My name is Mark McIntyre.

I'm the interim director for the office of economic development.

Can you please pause for a moment?

Sure.

I'm not seeing the presentation on my zoom window.

Can the public see it?

It's on the screen.

Okay.

There we go.

Thank you.

Sorry.

Please continue.

Next slide, Payman.

So today I'm really excited to be back to be here in front of you.

Last time I was here, we were talking about our race and social justice initiative goals and what we did in the last year and kind of what we're looking forward to next year or this year rather.

And now today I'm here to give you kind of a peek behind the curtain in how we're thinking about OED's role and function in the regional economic development system and the local economic development system.

and then talk a little bit about how we're thinking about how we can revitalize our local and regional economy as we turn the corner on the pandemic.

I want to be clear that this really is an update on where we're going.

My intent here is not to say that we've got a fully baked plan.

It's more to reset a conversation with council about economic and workforce development.

and share with you kind of what we're thinking about some key strategic questions.

So some of those questions are, who are we serving?

How are we serving them and why?

What's the right balance between OED being reactive and proactive to growth opportunities?

What's the best role for the city in shaping growth, especially in kind of a regional context?

And where can we as a city department make the most impact for residents and businesses?

So those are some of the questions wrestling with as we're thinking about OED going into the future.

Next slide, please.

So previously, OED has largely been a collection of programs rather than a strong department with a clear economic agenda.

And so that's, Item number one for us as a team over at OED to figure out is kind of what's our coherent mission and vision and then what's our role.

So our mission as we're talking about it is to build an inclusive economy where everyone in Seattle can fully participate in and benefit from our prosperity.

And then our role is to drive economic growth through strategies and investments that open doors and remove barriers to wealth building opportunities, especially for communities that have been systemically excluded from such opportunities.

So really, to kind of shorthand that, it means that we want to be a dot connector.

Rather than a program manager, or a deliverer of discrete services, we want to have a larger worldview about economic development and be more of an economic orchestrator.

So I'll give an example of that.

Economic development and workforce development are team sports.

They don't happen in silos.

And one of the missing elements lately has been Seattle being a regional partner.

So showing up at the regional stage and really trying to push Seattle's economic agenda, but seeing how it fits in with other cities, with the County, with the state, with the federal government, really understanding how we link all those together, both to have alignments in our strategies, but also to create multiplier effects for monies that we spend in investments.

And so just as an example of what OED needs to do differently is instead of being a program manager, we need to be a regional player showing up at PSRC, at the Workforce Development Council and other bodies to really be a partner, but also a leader on that regional level.

Next slide, please.

So one of the key problems that we're focused on at OED, but also where we see huge opportunity is the issue of how different people benefit, how people benefit from the economy very differently, largely based on their race or ethnicity.

This is one of my favorite quotes.

This is by Dr. Raphael Bostic, who's the chair of the Federal Reserve Bank of Atlanta.

And this happened right after the murder of George Floyd in 2020. an excellent opinion piece about the intersection of race and economic issues.

And he said, systemic racism is a yoke that drags on the American economy.

This country has both a moral and economic imperative to end these unjust and destructive practices.

So as we're at OED, we feel those imperatives very deeply, and that's really driving a lot of our work as we think about what we're gonna do next.

And so then as we think about what does that mean and how do we actually make that happen, the key thing we want to focus on is the racial wealth gap, which is quite large.

And there's been a lot of focus on the racial income gap, which is important, and we need to focus on job creation, inclusive business practices and talent development, those are all very important.

But at OED, one of the things that's been missing is this focus on wealth building and business ownership, business growth and asset ownership, which are gonna be really key to where we go in the future.

Next slide, please.

So what does that mean?

Like how do we actually tackle the racial wealth gap?

We're talking about an inclusive economy, which can sound kind of fluffy and seem like a, just a jargony piece, but how we're defining it is the meeting of all these three types of wealth.

So you've got individual wealth, often through income generation, you've got business wealth through business growth, and you've got community wealth, often through placemaking strategies that allow for a healthy business environment, both at the local neighborhood level, but also at the city and the regional level.

Next slide, please.

So For OED's work to be able to influence those, these are the three areas where we're really gonna prioritize.

Workforce development.

So this is how do we create talent?

How do we help match people to jobs?

But at the end of the day, it's really how are we getting people onto career pathways so that they can earn higher incomes and better benefits over time?

It's not enough to just get people on the first rung of the ladder.

We really need to do think about how are we getting people two, three, four rungs up the ladder over the course of their careers?

How are we helping people move from careers as economic conditions change and job expectations change?

And then how are we making sure that they're well prepared to be successful in those careers?

Business and industry growth.

I think this is something where we've struggled as a city, both in our industry relations.

So resetting some of our relationships with different industries, whether that be maritime or technology, healthcare construction, we've got some really healthy industries here in the Puget Sound and Seattle region, but we haven't necessarily focused on business growth.

There's been a lot of focus on relief efforts and rightfully so, especially through the pandemic.

and helping businesses that are struggling.

But we've also got to prioritize how are we helping businesses grow with a special emphasis on helping BIPOC and women business owners grow their businesses, gain wealth, and hopefully own their businesses and their assets as they're going along.

And the third, healthy economic ecosystems.

This is actually where we've had some success over the pandemic, is really trying to activate our neighborhoods, make investments that are gonna empower neighborhoods to be self-determinative about their economic future.

I'll give one example.

Last Friday, I was with three other city department directors.

We went and visited Lake City Collective in district five, which started out largely as a, a nonprofit that was supporting their neighborhoods and is now expanded with the support of OED and OIRA to support language access help for businesses all across the city.

So when those businesses are trying to access federal relief funds, or trying to tap into an OED program or get connected with business training at the Seattle Public Libraries, they can go to Lake City Collective and get those resources and those connections in language.

And so something that started as just a neighborhood business ecosystem group has now grown into a real citywide asset that we'd like to see replicated in more neighborhoods.

Next slide, please.

So with this kind of new role, as an orchestrator and with these new demands and challenges, both coming out of the pandemic, but also with the new priorities on wealth creation, we need a new OED.

So a lot of that is happening right now.

This is my third and a bit month in the role, and we've been ferociously going at kind of a reorganization so that we can be more effective at the work, so that we can deliver excellent project management, we can deliver excellent customer service, and we have enough brainpower and talent dedicated to help with those growth strategies.

Because one of the biggest things that we need to do at OED is get out of reactive mode and get more into proactive mode.

So we've been restructuring the department.

We've been adding capacity and talent.

I mentioned this last time at the RSTI presentation, but I'll mention it again that we've had 78% turnover of staff in the last 16 months.

And so that's just, it's both an issue in that we've lost a lot of institutional knowledge, but it's also an opportunity to really add some new capacity and talent to the team.

Throughout it all, we're going to need to strengthen and grow, as I mentioned, our regional relationships, but also our private sector partnerships.

And then, as I mentioned at the top, there's tremendous opportunity in seeking alignment and multipliers within our regional economic development system.

So you see here on the right side of the screen, two sides of the house.

navigation strategies.

So that's when a business comes to us, uh, seeking some form of help, whether it's connection to relief dollars, uh, or help with an accounting issue or any myriad of things that they might need help from OED or the city on, we need a way to make sure that we're either answering their question quickly and succinctly, or we're navigating them to the appropriate resource, either within the city or with our network of referral network of partners.

We've got to do a better job of using technology to both monitor and track what we're doing there so that we can be really clear on what trends of questions we're getting so that we can feed those up to you guys at council, but also to the mayor's office and other departments to try and solve problems before they become problems in the future.

But then second, as I mentioned, we're gonna have to have this portion of the staff dedicated to growth strategies.

And we're splitting that into three main buckets.

We're doing capacity and neighborhood business developments, wealth building strategies, which includes real estate finance and market expansion, and then our key industries and workforce development group.

So more to come on kind of how this is actually shaping out, but wanted to give you guys a preview of where we're going.

as a department.

Next slide, please.

So some of this is a little repetitive, but I did wanna include one, this lovely picture of people out spending their time in their day of service, helping build a better Seattle.

But then also just talk a little bit about how we're doing this.

So it's the collaborative relationships, it's aligning regionally, it's prioritizing multiplier.

opportunities and then really prioritizing innovative approaches to wealth building.

This is again, it's something that's a little bit new for OED for the city to be focusing on.

So we're going to have to have to be smart and creative.

We want to go out and steal other ideas from other cities, but also look to our communities who are already doing this work and lift up those ideas that we think could really make a difference if we could scale quickly.

Next slide, please.

One of the key opportunities that we're focused on as we go through our restructuring with this new role is this economic revitalization implementation plan that council has tasked OED with developing.

So this is just kind of an outline of how we're doing it.

We will have more to come hopefully next month and then in the following months.

But first, the goal is to define the future of the Seattle economy and do this in partnership with a variety of other economic and workforce development players.

We really wanna find those shared objectives and figure out where we agree rather than focusing on where we disagree.

So if we can find those four or five things where there's common agreement that we really need to focus on, and I'll give an example, access to capital for small businesses is clearly going to be a priority.

It was a problem before the pandemic and then hugely exacerbated during the pandemic.

We did find some innovative solutions and we've got to continue kind of building on those as we go forward.

But if we can find those four or five things where we agree and really bring people together around them, that's a One Seattle approach to building a new, more equitable economy.

Second, as part of that study, we've carved out this piece for a citywide workforce development strategic plan.

we could have, and we probably will, an entire another presentation on workforce development, but it's a key moment where our city has had a fragmented approach to workforce development.

We have not been a good partner at the regional level.

We can reset all of that, and I think really drive some new innovative ways of getting people connected to jobs and on really successful career pathways.

So if you combine the two of those, we'll then have clear recommendations for the payroll expense tax dollars investments, as well as, again, kind of the overall look and feel of the Office of Economic Development.

throughout it all with our outreach and engagement, the planning process will generate a coalition of supporters for these ideas.

So that again, we're not kind of baking a plan and hoping that and delivering you kind of a doorstop novel of ideas.

We're actually generating these, generating this in partnership.

So at the end, we're already going to be moving toward toward implementation rather than having to have a plan just kind of sit on a shelf while everyone reads it and kind of calculates it and figures out whether or not it fits their plans and goals.

We'll already have done that by involving people in the planning process.

So phase one, which is a meta-analysis of local and regional economic and workforce development strategic plans we'll have at the end of this month.

And so we'll be sharing that with you guys in the next, in July, as we kind of go on a little bit of a roadshow to go back to the partners to tell them what we found.

Next slide.

So I do wanna be clear, as I talk about the future, I don't wanna neglect the present, which is that a lot of businesses and workers still need emergency relief.

We are not out of the pandemic.

And so we really wanna set up this next year as a bridge to the future.

So it's a bridge year where we're both still providing some immediate and emergency relief, but also starting to build out some of those programs that are gonna set us up for long-term prosperity.

So here are just some of the buckets that we're really focused on in this bridge year.

Again, continuing with downtown and neighborhood business district recovery, it's imperative that we activate those neighborhoods, activate downtown, get people out spending money, main street businesses, and really just generating that vibrancy.

We need to focus on small business growth.

Again, there's an emergency relief aspect to that, as well as trying to set up businesses for future success and expansion.

I've mentioned workforce developments and the citywide investment strategy that we've got going on there.

Key industry support.

There are some industries that are pretty healthy coming out of the pandemic.

There are others that really, really could use some support from the city.

So we've got to be there for them.

I call it the maritime industry is one where there's a lot of changes happening with industrial maritime lands.

There's a lot of changes happening with their workforce and talent.

We've got to really be a partner in thoughtful about how we're supporting that industry.

It's such a key component of our economic makeup, but also as part of our history as a city.

And then finally, as I mentioned with the Lake City Collective, we've got to do a better job with our language access and outreach.

It is all well and good if we develop the coolest program in the history of economics.

here in the city, if we can't get that out to folks and let them know about it and encourage everybody to apply and benefit from it, it's worth nothing.

And so we've got to step up our game and establish better trust externally with our partners and make sure that we're doing it in an equitable way that's really inviting people in and making them feel like they belong and that they're part of OED and we want them to succeed.

Next slide.

So the good news is that one of the silver linings of the pandemic is the Clifford dollars that we were able to put to work for economic relief and recovery.

And so we've learned a lot in, in the last year, as we've deployed those dollars about where we can really make a difference.

And I'll give one example, the Seattle restored program.

which we launched earlier this year that connects BIPOC businesses to available vacant spaces downtown in downtown Seattle, is a great example of us providing access and breaking down barriers to real estate opportunities for businesses.

Another good example is the tenant improvement program that we piloted in the central area.

One of the businesses that we helped is the now world famous communion in the Liberty Bake building.

The tenant improvement program helps with the build out of the space so that we can make sure that when a business gets in there, they can be as successful as possible.

So we want to expand that.

And then finally, we wanna roll out, and we're working on this for later this year, a small business ownership program.

Because again, it's not just about the business growth, it's also about business ownership and asset ownership.

So as we think about these things, this is some stuff that we've learned over the last year, some with these one-time recovery dollars, that's really setting us up for success in the future.

And if we can grow and scale those, we believe we're gonna be really successful, again, in those goals of trying grow businesses and get people into higher paying jobs.

Through it all, I'll just mention that last bullet of business technical assistance.

We know that businesses need help with the paper game.

It's not always easy figuring out how to apply for a loan or how to apply for some of these grant programs.

So we've got to make sure that we're holding their hands as well as we're capacity building in neighborhoods and across the city with CBOs and other organizations to help hold their hands as well.

It really is, as I mentioned earlier, a team game, a team sport economic development, and we've got to build a better, more sophisticated team to really help those businesses and those workers.

Next slide.

So wrapping up, we've got new demands, new strategies, and a new look OED.

The city's gotta prioritize wealth building and income boosting efforts.

And so our economic development priorities are on the talent development, quality job creation, inclusive business practices for income boosting efforts, and then business ownership, business growth, and asset ownership for the wealth building efforts.

Listed here are just, again, some of the new pieces that we're really gonna focus on in the near term as we're doing our reorganization and adding talent capacity.

We wanna focus on real estate, we wanna focus on finance, particularly access to capital, and then we wanna focus on market expansion.

We think that these three areas are gonna be kind of hallmarks for OED going forward.

They're gonna take us a little time to build out, but we're really excited about what they could bring to the mix.

We're going to continue to do, as I mentioned, the technical assistance, the key industry support, and a variety of other services.

But some of these new pieces we think are going to be the real key between where we were pre-pandemic and where we want to go to a more equitable economy post-pandemic.

And with that, I will stand for any questions.

Well, thank you, Mark.

And you had me at the new OED.

So it's clear from your presentation how vitally important OED's work and mission are and it's solidifying identity.

It has been hobbled by staffing shortages for years and the 78% staff turnover was really striking.

And I also think it has been, I don't know, the importance of its work has been downplayed or we have failed to recognize, I'll just say, its importance as the place where equity in terms of job creation and BIPOC wealth generation and anti-displacement lives in city government.

So this will be top of mind as we go into the budget discussions.

And that's all I have.

I'll open it first for questions from my colleagues.

Well, I'll get things started here.

So I really like you distinguishing between navigation services, which I think of as direct services to businesses and growth strategies, which I'm kind of thinking as policy areas, priorities, programs.

And so when it comes to the navigation services, you spoke to it a little bit.

I'm wondering if you could expand on that and because you and I have spoke of a help desk and the back team.

So just wanted to hear a little bit more about that.

Sure.

Right now, our front door.

to OED is a little, it's either hard to reach or hard to get in.

And so we need to have a better front door, both technologically, but then also our system for intake.

So when a business calls, making sure that they get connected as quickly as possible to the resource that they need.

Right now, it's a little bit ad hoc where if you reach the right person on the team, Lucky for you, if you don't, it gets a little hairy.

And so we've got to systematize how we're doing the intake of those issues and calls.

Some of that, as you mentioned, is the technology.

So what does our website look like?

What kind of help desk online can we offer to quickly answer questions that people might have?

Some of that is our own staff.

So how we're assigning those tickets out and making sure that they're getting followed up on.

And then again, we're tracking and finding trends so that we can help influence policymaking and program development.

Some of that is working with other departments, ideally through the resuscitated city business action team so that we can batch some of those problems together, have a team of decision makers in different departments so we can take those problems get them quickly resolved.

and then get the businesses moving on to whatever's next in their business cycle.

So there's a variety of elements that we're trying to tie together.

It is building up kind of a new system.

So it's a little rockier than I had anticipated, but I think there's a lot of energy on the team for finding a solution, working with businesses to figure out how to solve their problems in a quick and efficient manner.

Great, yeah, as a small business owner, I've often thought that there should be a one-stop shop where you can get all your information about licenses and permits and yada, yada.

And then if SBCI is telling somebody to do one thing, but City Light is saying, no, you have to do this other thing first, that kind of coordinated response that departments can talk to each other.

But I really appreciate the emphasis on that.

And I'm sure other small businesses do too.

Well, and part of it is at OED, we've got to play a little bit of a translator role between businesses and governments.

Cause they do move at different speeds and they do talk about things differently.

And so we've got to figure out how we do a better job of translating so that we're on the same page and working on the same time, timeframes.

Cause oftentimes I think that's where we get off kilter is a business needs something in a week and the city's maybe that's not how the process is set up to answer that type of question.

So we've got to do a better job of syncing those up.

Councilmember Sawant.

Thank you, Chair Nelson.

Thank you for the presentation.

I'm just wondering what are the conversations the Office of Economic Development and the Mayor's Office have been having?

I hope you've been having some conversations about the recession that is moving in front of us.

And in reality, some many economists are actually wondering if the recession is already underway.

If you look at the runaway inflation, the historic 40-year high inflation.

People are really feeling the pinch at the gas pump and in the grocery store.

And just given the way the economy under capitalism is set up, we know that three-quarters of what holds up the economy in terms of GDP is consumer spending.

And given this dire situation, I hope you all have been discussing what impact this will have on the economy as a whole, but especially for ordinary people, working people, struggling small businesses, the prognosis does seem to be extremely concerning.

And I'm asking this question in general, but also in the context of the fact that an interesting ruling came from the Washington State Court of Appeals yesterday.

This ruling upheld the Amazon tax that was won by ordinary people's movements in 2020. And I mentioned that for several reasons.

One is obviously that without that tax, actually in the COVID recession, the city of Seattle economy would have cratered if it wasn't for the revenues generated by that tax.

But that tax was something that the Metropolitan Chamber of Commerce and big businesses and the wealthy really were extremely hostile to.

Mr. Mark McIntyre, you were, I believe, the Executive Vice President Seattle Metropolitan Chamber of Commerce at that time.

So anyway, my point is that the positions that the big businesses have taken historically have been extremely contrary to what is being claimed, which is the health of small businesses, health of the economy and so on.

It was proven beyond a shadow of a doubt how critical the Amazon tax has been for the economy.

In fact, we need much more actually progressive revenues.

We need to increase the Amazon tax.

But I'm also asking that, as I said, in the context of the dire predictions for the economy.

So if you can just weigh in on that.

Thank you.

Sure.

Thanks for bringing up the possible looming recession.

It is concerning.

And in conversations, I think there's a couple of things that we can do to prepare ourselves.

One is we need to get smarter at OED about what's going on with micro and macroeconomics.

So we've just hired a data and research person who's gonna be starting at the end of this month.

So that's gonna help us get ahead of these and better understand what's going on locally.

So we can tailor our strategies and our investments to hopefully prevent the worst, but also set ourselves up for success coming out of issues like a recession or the pandemic.

Second, and this I think was a huge silver lining of the pandemic, again, was the regional alliance and partnership.

We are going to be stronger if we're working with our suburban partners, if we're working with our regional entities.

And we have alignments and support each other.

That's, that's going to be key to weathering any storm, whether it's the pandemic looming recession or anything else is working together as a region.

So it is concerning we are talking about it and trying to prepare as best we can.

But I guess the flip side of that is, is in any downturn, there's always opportunity and we need to be geared up to be looking for those opportunities and setting ourselves up for future success for the residents and businesses.

What opportunity would you be talking about right now?

The living standards for the majority of people are in extremely, are under extreme stress and small businesses, were among those who took the brunt of the pandemic and recession.

So I'm really not understanding what you mean by opportunity.

And also what is the vision here and the basis of a lot of what- Council Member Herbold does have a question.

Okay, but I'm a member of this committee and I'm asking a question.

I'm not understanding what is the vision that the forces that you've been in conversations with are bringing.

I mean, as I mentioned, the Metropolitan Chamber of Commerce sued the city to overturn the Amazon tax.

The Court of Appeals has just upheld the tax, but What is the vision you bring if you're opposed to even common sense measures that the city actually needs?

So when you say opportunities in a recession, that sounds like an oxymoron to me, like opportunities for whom?

The vast majority of ordinary people and small businesses are going to take the brunt of this recession.

What is the opportunity for them?

What is the opportunity you see when the gas pump sells $6 for a gallon?

I'm not saying that it'll be easy, but I think first of all, we've got to stabilize and provide relief to those who are suffering.

And I think we've seen how we've done that through the pandemic.

It hasn't been successful across the board, but I think we did brunt some of the edge of it.

And then I think also during the pandemic, you saw a historic rise in the number of small businesses that were created.

People left their jobs and started creating businesses and we've got to figure out a way to help support them so that they can be successful in the long term.

It's not easy running a small business.

It's incredibly hard.

And we at the city, unfortunately, sometimes make it harder.

And so again, that's why I really want OED's role to be about breaking down barriers and opening doors so that those who have been excluded from economic prosperity in times past regardless of kind of current conditions that we're trying to do our best to give them access to opportunity now and into the future.

Again, I'm not trying to sugar coat and say that it's going to be easy or that there won't be suffering along the way, but we've got to do our best to alleviate that and try and set people up for success.

Council Member Herbold.

Thank you.

I just wanted to ask questions that I've had the opportunity to us in our meetings together.

public employment of your answers.

I want to talk a little bit about the key industries for the city.

On slide 10, you mentioned that key industry support is a bridge to the future.

As I've mentioned to you in our meetings, I'd really like to see creative industries restored to the short list of key industries that drive our city's future.

The city's 2019 creative economy study found that the creative sector drives a full 18% of our GDP here in Seattle.

That's four times the national average.

And we know that a subset of workers in this sector are arts, culture, film and music workers have been among the hardest hit and the slowest to recover from the pandemic.

focusing efforts on this sector has the potential not only to help us rebound faster here in Seattle, but to preserve what we all agree is so special and unique about our city.

So just wanting to know a little bit about how you're thinking about the creative economy as you consider leading the department's work.

and the strategies that we can look forward to working together to employ to lift up this really important contributor to our city's economy.

And I'd love to hear your thoughts on that.

I also have one additional follow-up question, if that's okay.

Well, it's not really a follow-up question, maybe it's a separate question.

Before we begin, can I mention something?

You know, I was going to say at the end of my questions that I didn't ask anything about film or the creative economy cluster, because we're going to be having another discussion just about that on July 27th.

Proceed.

Yeah.

And this is much broader.

This is not just film and music.

This is the creative, right.

Creative industries more broadly.

Thank you.

Yep.

Thanks for the question.

And you're right.

I mean, a lot of those industries were the first to shut down and the last to open coming out of the pandemic.

And so they're still very much feeling the brunt of that economic lag.

As I mentioned, if our goals at OED are how do we boost people's income and get them into jobs with higher pay and better benefits?

And then secondly, how do we grow businesses to grow wealth, particularly for communities that have been excluded?

I think the creative industries fit nicely into that rubric.

So if we're talking about creative economy jobs, those exist in a variety of different industries beyond just kind of film, music, nightlife, special events.

And so we've got to figure out, and as you said in the study, it's shown that that's where there's going to be a lot of job growth now and into the future, particularly because those are automation-proof, tend to be automation-proof jobs.

As well as, you know, we have an incredible innovative spirit here and creative spirit in Seattle.

And so part of it's just harnessing that and figuring out how do we put that to work in a creative, creative way.

And then second is how are we supporting those specific industries to make sure that those businesses are successful as possible?

I would call out film as an example, just because that's been one that we've been focused on.

at the Office of Economic Development in my first three months here, working with stakeholders, working with production businesses to figure out what do they need both in the short term and the longterm and trying to come up with a plan for how we best serve them.

And as Council Member Nelson said, that's what we're gonna be coming to this committee at the end of July to talk about as an example of how we're supporting one of the creative industries.

So it is important.

We are, that's part of the talent and capacity that we're building on the team so that we have better brainpower and more people to do the outreach and understand what the needs are as well as to hopefully design programs and policies to again get locals into those high paying creative jobs as well as support those businesses in creative industries to be successful coming out of the pandemic.

Thank you.

Um, may I ask my second question or with you?

Okay.

Okay.

Thanks so much.

I'm just following up on our discussion around how can work with the office of housing.

And facilitate their interest in taking a sort of a development approach to housing development sort of housing and different types of spaces that.

can activate a community, whether or not it's a retail space, some other kind of commercial, non-profit use, cultural space.

In my district, I've been working with a group of community members who have, for several years, been working towards activating a surplus piece of property.

And they've long held a division of developing affordable housing and with ground floor commercial space to help activate that street space, build community safety, provide opportunity for small entrepreneurs and contribute to a more walkable community in a place that isn't terribly walkable right now.

Office of Housing has funds that can award and potentially support affordable housing on that site.

The trick is, as I know you understand, Director McIntyre, is that how to braid those funds with other kinds of support that will allow for that ground floor retail to be built and affordable as well.

And I know that you've been having conversations with Director Winkler-Chin and just wanting to hear, since I know you had had a meeting with her to talk about this topic, to see if there's anything new to bear.

Thanks for bringing it up.

I think this is so exciting because we know we need more housing and we know we need more commercial, affordable commercial space.

And so putting those together in the same projects just makes a ton of sense.

There's also a workforce angle there as well, as we're building these housing units and managing them, how are we making sure that we're training locals and getting them hired into those good paying construction jobs?

So in my talks with some of the other directors, I'd include OPCD as another department that we're working with to explore this.

There's a lot of interest.

It does get a little technical into how you braid those funds together.

I like that phrase, I might steal it from you, but I'm excited because some of the programs that I mentioned, like the Tenant Improvement Fund and the Small Business Ownership Fund are really set up to help, and as well as Seattle Restore, help make sure that we're doing that matchmaking, that we're making those spaces work for different types of small businesses, and that ideally we're putting people on the path to ownership of their real estate.

So some of the stuff that we're launching now can fit into some of the future combined strategic work that we can do with the Office of Housing and Office of Planning and Community Development.

There's a couple opportunities that we see going into the future.

One is the 2023 housing levy, because that's going to be a renewal of a lot of resources.

And so making sure that we're calling out affordable commercial space as an ambition for that work is important.

And then second is looking at the next round of the comprehensive plan.

As we kind of unzip the code, thinking about, are there any changes that we need to make to make this a little bit more easy to do?

And part of, our long range planning for our strategy and investment around housing and economic development together.

So more to come on that.

We're actually working on a slide for council in this regard that'll be delivered later this year to kind of give you a more grounded sense of where we're going with this, but know that this is one of the areas of opportunity that we see.

And certainly again, with a new look OED that wants to be a real strong partner.

One of those partnerships is going to be with the office of housing and OPCD.

So looking forward to it.

Council Member Juarez has a question, but I wanted to also, hold on a second.

Okay.

I just wanted to note that regarding the creative cluster, there is a position that is currently provisored.

We're going to be waiting from you for more information about that to lift that.

But as soon as we get that position filled, then we can add horsepower to those efforts.

Okay, Council President Juarez.

Thank you.

Madam Chair, first of all, Mark, thank you for being here and your presentation and moving from the nonprofit private sector, if you will, to now becoming a public servant.

I actually like you having on this side of the aisle more because I feel like now we're part of the solution and we can have discussions.

about the jumpstart Amazon tax and what that means and how we use those funds.

But getting back to your presentation, the column that I was most interested in, and obviously we know the work that OED does, is the finance and the access to capital.

I obviously support small businesses in assisting them.

My focus has been in my personal professional life is building economies, not only in Indian country, but in rural communities and low income communities, establishing economic engines, teaching people how to go to a bank, write a business plan, get a loan, and access to capital.

And so I'm wondering why, I have two questions actually.

Is OED going to take an active role in working with the Small Business Association?

Because we do a lot of work with them.

Um, and I know that there's some, some whispering now about some taxing coming up on a particular industry.

And, you know, a lot of those issues, um, if we talk about what training is, it really is about, um, and I used to do this for clients and tribes and individuals, um, working your way with small business association in taking the class and teaching how to write a business plan.

What is your business mock interviews, low interest loan capital.

Um, and then.

the small business, the SBA, at least under the Native American and other groups as well, would end up forgiving the loan when you became not so much successful, but when you could meet those payments.

And so I don't think you need to reinvent the wheel on that.

I don't think OED and government is good at that on some level and on a local level.

So are you working with, because you're talking about lenders and, you know, because you're going to need angel investors.

You're going to know how to go to a bank.

And I don't know if it's so much handholding, because I think people have the intuitive knowledge and the drive to do it.

But it's more like, what are some of the existing programs that are already here that have been successful that is OED going to take advantage of and use?

This goes back to my love of alignments that I completely agree.

We don't lack for resources here.

A lot of it is more about how we're navigating people to the right resources and kind of opening those doors for them.

And so, yes, I feel really lucky that former senior deputy mayor Mike Fong is now the region 10 administrator for the SBA because he both has an in-depth knowledge of the city, its capacity, and its limitations, as well as a deep love for Seattle.

And so he's been a great partner as I've started out here.

Actually, I think he was one of the first people to call me after the appointment was announced, looking, already coming up with ideas for how we could work together.

So we've got some stuff that we're cooking up that we'll be excited to announce soon.

But an early example was when SBA announced their business person of the year for the Pacific Northwest.

We were there standing with the mayor and Administrator Fong celebrating Ephraim and Boon Boon Coffee, just as a kind of showy example, but we've got some more meaty stuff coming in the future.

So just one of the issues and I don't think it's a secret about the potential taxing of the cannabis industry and access to capital and Councilmember Herbold knows this as well as I do.

I'm sure Councilmember Nelson knows this as well.

We can't do a lot until we have the federal banking laws changed to allow people who want to open and that's why we've seen the inequities.

People that have money can get capital and can have agile investors and can open up stores.

And we've seen, we all see the inequity there.

It's right there.

I don't know if taxing is the right response, quite frankly.

I don't know what kind of training that means.

If we had it where people could go to a bank to get capital, to get a loan, to start a small business for a cannabis store, then I could see where there would be training and you would connect with a small business association like Model you teach people like okay here's your business plan, here's the class you have to take, here's how you get a loan, here's how you write your business plan, etc.

I don't know if we're there yet, but what do you see for OED doing that for other businesses that can go to a bank or a venture capital group or how are you going to open up those systems and do more?

And I don't mean just like oh we're going to open up the community for education, I mean Really what is OED going to do to open up that so people can have access to a bank, to do a loan, to start a business?

Because that's really what a lot of folks need.

They need that kind of education and they need that kind of access and opportunity if indeed we're going to close this gap, this wealth.

I mean, I couldn't agree with you more.

So we see businesses needing three things, right?

They need the training to run a successful business.

But there's a lot of programs that just kind of stop there right all they're giving is some sort of education, but really what they then need is access to capital and then access to markets.

So if you can pair those three things together, that's usually a fairly successful recipe.

And so that's the work on those latter two, the access to capital, the access to markets is why we're kind of reshaping OED to have a focus on those, because that's where we see business growth really needing that kind of attention.

But I'll give you an example of a program that we launched with some of the federal dollars directly related to access to capital.

So the state has a flex fund where they were offering loans at a fairly low interest rate through our Community Development Financial Institution, CDFIs, to small businesses in need.

The city, using those Clifford dollars, developed a capital access program where we could actually pay down 25% of their loan principal.

So it essentially made the access to capital more affordable for those small businesses that really needed it.

So we're gonna have to do creative, creative things like that, because the city is not necessarily looking to become a lender or get in the lending game, but there are ways that we can either make it more affordable or kind of, again, open doors or break down barriers to that capital.

So those businesses get access to it.

It's gonna require, again, this is why we need to get out of reactive mode and into proactive mode is because currently, if we're only responding to crises, we will never come up with those creative solutions for how we connect businesses to, to capital to grow.

That's why we're got to do our reorganization.

I mean, you essentially kind of sold why we're we're doing what we're doing in a nutshell.

So my last comment, if I'm if I may, Madam Chair.

Yes.

Is that we're still in the process of and we'll be doing it soon.

I'm rolling out more than a land acknowledgement.

And we've been working with tribes.

And as you know, the Muckleshoot Nation is a big property holder in downtown Seattle.

And They just bought a $27 million housing in District four, and I'm trying to get them to all come north, by the way.

So I'm trying to make defy the home for and working with assignment and OBG NHL and all the folks up here it's, and we developed well over 5000 jobs.

We're very proud of the work that we've done here.

I want to make sure that OED is working with Tim Ranian, who the mayor hired as a tribal liaison, because Tim Ranian, I hope Tim's listening, is a phenomenal hire for the executive, being a lawyer and a former tribal council member on the Puyallup Tribe, and understands economic development like the back of his hand, like me.

And so it's wonderful having these high-level discussions with him about how indigenous and tribes invest in their city.

This is their city, the city of Seattle, hence more than the land acknowledgement.

So I'm hoping that we can work with, and we are working with Tim, but to work with you as well in how we structure and kind of redo what we did in Indian country in the city of Seattle, not only for individuals, but also to bring in tribes to invest everywhere.

I think people need to understand that tribes do more than casinos and hotels.

We actually own a lot of stuff and a lot of property.

As you know, the Puyallup Tribe just inked a deal with Kenmore Air and Amazon and has been successful as well as Muckleshoot and Suquamish.

I mean, that's the attraction in my discussions with tribal leaders is they want some kind of inroad besides the executive.

like Office of Economic Development, that there's a place for them.

And I don't think that there's anyone at OED that is doing that kind of work.

And I don't think we can put it all on the shoulders of Mr. Ranian, or quite frankly, myself.

So I'm hoping, Markham, that you and I have a chance to have coffee offline and talk about how we integrate more than the land acknowledgement and the economic development and vitality that tribes have to offer, including leveraging their sovereignty in their own land, but also, obviously, to land in OED.

I'm really looking forward to that.

I'm looking forward to it as well.

I'm excited about the opportunity you're presenting.

And that's exactly the type of stuff we want to get working on.

So I look forward to talking to Tim about that more.

Yeah.

I mean, I'm going to say something that's probably obvious to everybody, but I'm just going to say it anyway.

You know, business is about relationships and it's about welcoming communities and neighborhoods.

And while I respect my colleagues and the issues that they want in their districts, I think the bottom line is you need economic engine so people have jobs.

And if they have jobs and you have transportation and you have libraries and you have good schools and you have sidewalks and you get the good stuff.

And we've been working really hard and I want to point out for her book because she's the longest serving, I'm sorry customer shop customers want as well is, is working to close those economic wealth gaps.

and making sure that we have housing and all that stuff for everybody.

And that's, I think, hopefully one of the legacies I can leave when I leave here.

So thank you.

Okay, I really appreciate those comments.

Small businesses employ about 70% of the people that work in the private sector.

And so that's jobs.

Anyway, we're running out of time, I would have liked to have asked about downtown revitalization.

We can talk about that offline.

To me, it means improving Third Avenue, perhaps some business recruitment, but that's for another discussion.

So thank you, thank you, thank you very much.

We will see you on the 27th to talk about the film economy.

And I invite any of my colleagues to set up appointments with Director McIntyre and learn more about some of the things he's touched on.

So thank you very much.

Thanks Council Member Nelson.

Thank you to the committee.

Okay, moving on.

Will the clerk please read item two into the record and the presenters can come to the table, please.

Agenda item number two, resolution 32056, a resolution related to the City Light Department adopting a 2023 to 2028 strategic plan update for the City Light Department and endorsing the associated six-year rate path for briefing and discussion.

Okay, so this is our first discussion and we'll have our second discussion and possible vote at our next meeting on July 13th.

Just a little bit of background on this cribbed from Eric McConaughey's memo from central staff.

It's linked on the agenda.

The disruption of the pandemic in 2020 interrupted the expected update of City Light's strategic plan and rate path.

And in recognition of the economic stresses due to the COVID-19 pandemic, the executive did not transmit and council did not take up rate setting legislation during 2020. And in 2021, council approved rates for 2021 and 2022. and they were effective on April 1st, 2021. So differing from the regular practice, City Light proposed in the council adopted a five year strategic plan for 2022 through 2026. after council approved that rate plan.

So now in 2022, City Light has proposed a 2023 to 2028 strategic plan to council, thereby restarting the normal two-year cycle of strategic planning rate path determination, and rate change adoption.

So we're getting back on schedule.

The committee will take up the proposed rate changes in August.

And now will the presenters please introduce yourselves.

Good morning.

I was going to start and my name is Deborah Smith.

I'm remote.

Thank you for allowing me to call in today.

I am just going to kick this off and turn it over to my very well-equipped team.

And I just really want to thank you and appreciate the time today.

And I'll let you know how excited we are to share this strategic plan update.

So with that, I'm going to turn things over to How about Lee to introduce herself and then you can just buck to Kirstie and the rest of the team.

Thank you.

I'm Lee Barreca, the manager of strategic planning and performance for City Light.

Good morning.

My name is Kirstie Granger.

I'm City Light's chief financial officer.

Good morning.

I'm Jenny Levesque, external communications manager at Seattle City Light.

I'm Scott Haskins.

I'm the representative from the Seattle City Light review panel.

And is Eric present online?

Yeah, hello.

I am Eric McConaughey on the Council Central staff.

Good morning.

Good morning and welcome everyone.

Please proceed.

Okay, next slide please.

Thank you.

So as we, as Council Member Nelson just mentioned, we anticipate being back here on July 13 to respond to any questions that we may get between now and then or two questions that you pose today that will need a little bit of time for us to gather information and then hopefully going to full Council action on the 19th to adopt this strategic plan update next place.

So this City Light strategic plan, just a quick overview.

This is our one, two, three, four, six strategic plan and our update.

The first was delivered in 2012 and covered the years 13 through 18. The process was established by council ordinance and it has a six year rate path in addition to a set of priorities initiatives with the rate path to support that work.

We developed the strategic plan in partnership with our City Light review panel.

They provide input on the plan and the right design.

Nine members of the panel are representatives of our various customer groups and areas of expertise.

Thank you.

Foundation to all that we do at City Light and to the building, the development of the strategic plan is our mission, vision, and values.

I, these will be reflected in several of the programs that we will be discussing today.

So, as we said, the 2022-26 plan was called, I missed this, but was called Recover, Refocus, and Restart.

So this plan update puts us back on our two year schedule, which coincides with our rate setting process.

Each strategic plan we conduct outreach efforts to inform the development of each plan.

In 2021 and 2022 we talked to several stakeholder groups, including groups such as the Seattle Renters Commission, the Northwest Energy Coalition, Seattle 2030 District, Seattle Business Owners and Managers Association, the Multi-Service Center, and Hopelink, to name a few.

We also conducted a virtual town hall.

Throughout the two years, we've talked with over 180 attendees.

This year alone, we conducted 10 strategy planning meetings with our City Light Review Panel.

In addition to meeting with customers, we examined the survey results that we'd received from a customer satisfaction survey and a clean energy future survey.

Two highlights, I guess, that came out of that is that a vast majority of respondents were concerned about climate change.

All demographics listed reducing climate change impacts, reducing reliance on fossil fuels, and reducing environmental impacts as the three most important benefits of achieving 100% clean energy by 2045. In addition, with our customer satisfaction survey, an overwhelming majority, 85% of residential customers are satisfied with the overall service they receive from Seattle City Light.

And reliability is one of the main areas that contributes to that satisfaction.

There is a detailed analysis of all these findings in Appendix B of the accompanying the strategic plan.

And at the end of the session, if you have questions specific to our outreach Jenny Levesque is here to respond.

Next, please.

Beginning last year, we made a.

A much more we really tried to flex our muscle in combining our budget setting process with our strategic planning process and working with our race and social justice initiative change team at city light.

Each of the programs, initiatives and activities in the strategic plan need to be supported by the accompanying budget.

And each of those programs needs to analyze the race and social justice impacts that it may have on our customers, the constituents, the residents of the city of Seattle, any of our stakeholders.

So this year we held a number of what we called equity labs.

These were conducted by the race and social justice team where project managers brought their project proposals to the change team and discussed the equity outcomes of their proposals, identifying marginalized stakeholder and to consider planning for the true cost of equity in interventions and to including those in the subsequent budget that followed.

Next please.

We delivered the 2022 strategic plan to the mayor's office last May and met with you in June and July of 2021. So since that time, we were not only working on an update to that strategic plan, but we've also been delivering some some important services to our customers and to the community.

And I just wanted to talk about a couple right here.

One of the things we're very proud of is delivering power in extreme weather from the wind storms and to the record snow in the winter and the fall and to groundbreaking triple digit temperatures in the summer.

City Light responded quickly and safely to get power back on and to manage the power loads to ensure the system could accommodate the increased use.

creating shelter for unhoused neighbors.

Working with other City of Seattle partners, City Light has turned our former power control center on Roy Street in Seattle's uptown neighborhood into a 24-hour shelter for 40 unhoused individuals.

In September 2021, the Smart Electric Power Alliance, or SEPA, which is a nonprofit that envisions a carbon-free energy system, announced that City Light had earned a spot on its 2021 Utility Transformation Leaderboard.

Seattle City Light and Washington State Housing Finance Commission's Sustainable Energy Trust were selected as the 2021 Green Power Leadership Award winners by the Center for Resource Solutions.

And finally, City Light continues installing and operating publicly accessible electric vehicle fast charters throughout its service territory.

And we've also partnered with King County Metro and the city of Tukwila to develop and open a charging facility for Metro's new fleet of all electric buses.

Next please.

Going into the specifics about the plan.

You'll see here our high-level business strategies.

These remain the same as were in the last plan and the plan that we delivered just last year, the 2022 plan.

But since the adoption of that plan in July, we've been developing the programs or what we call the PIAs, the projects, initiatives, and activities that we will undertake to help us achieve the objectives of each of our business strategies.

And the programs detailed in this strategic plan update are all about looking ahead.

We know the future is uncertain and success is dependent on approaching challenges and opportunities with curiosity, kindness, and a commitment to equity.

Economic recovery is happening all around us.

And as we just heard from the previous presenter, and as a community owned utility, our job is to help our customers thrive in the future we're creating together.

So now we'll talk about each of the business strategies very quickly.

And hold on.

General Manager Smith, did you have a question?

I think I saw your hand.

Okay, sorry.

Okay, our first business strategy, improve the customer experience.

We're focused on engaging with our customers.

One moment, she is now talking.

I was just saying, it looks like Council Member Juarez has her hand up.

No, that's an old hand.

Okay, great.

Well, that might have been the Deborah you saw.

Thank you.

Thank you.

Thank you.

With the customer experience, we're focused on engaging with our customers and helping our employees see the impact of our actions from the customer's perspective.

And we are also making investments to enhance accessibility and offer new program choices to better meet our customers' diverse needs.

Okay.

Thank you.

So this is Create Our Energy Future.

Our energy future is based on carbon-free renewable resources.

A new or improved infrastructure is needed to ensure that electricity can be accessed whenever and wherever people need it.

So much of this strategy is to implement programs and projects to enhance and upgrade our system.

to allow us to support the increased electrification from buildings and transportation while also looking at federal funding availability to help us fund some of these efforts.

Next, please.

Thank you.

Develop workforce and organizational agility.

This strategy is that our industry is transforming quickly.

And so are our customers' needs and expectations.

So we have to invest in our people, processes, and technologies to enable them to thrive in this transformational environment.

We're cultivating a workforce with the skills and knowledge to align with evolving business processes and business needs and to advance social justice.

Next.

Great.

Financial stability is essential to everything we do.

Responsible financial planning makes it possible for us to deliver the innovative energy solutions, plan for critical investments, and to keep our rates affordable.

What you'll see here, there are three, each of these slides highlights three important areas and programs that we're developing for each.

And you'll hear more about this one in the financial part of the presentation.

Next please.

And finally, but not at all finally, WePower.

This refers to our core mission of providing our customers with affordable, reliable, and environmentally responsible energy services.

In order to do so, we need to make infrastructure investments.

We will be providing transparency in our operations through enhanced metrics reporting.

And another key program that falls under this umbrella is the relicensing of our Skagit hydro project.

Now we'll move on to Kirstie Granger.

Thank you.

So an output of the strategic plan is a six-year rate trajectory that outlines the the rates that City Light would need to support the projects, initiatives, and activities that we just described.

This can be found in Appendix A of our strategic plan.

One, a part of city lights commitment to affordability is that we are aiming to deliver a rate path that looks like inflation.

And so you can see that for the strategic plan for the next six years.

It calls for 4.5% average rate increase for 2023, and again for 2024, and then 3% for 2020 2025 2026 2027 and 2028. The 4.5% for the next two years is higher than what City Light had projected in our strategic plan last year.

And this is due to the high inflation that we are seeing.

And I'm sure for anyone who's tracking, this is probably not a surprise that inflation is impacting us all right now.

For City Light in particular, the costs of raw materials, copper, poles, significant for us right now and are rising quickly even in the double digit percentages for some of these items.

So that the higher rate increases for 2023 and 2024 reflect the inflation that city lights been seeing.

for the past several years.

You can see there in the chart on the right, which compares City Light's rate path with the Consumer Price Index, as published by the city's own Office of Economic and Revenue Forecasts, that we compare favorably to the trajectory of inflation.

Inflation is high right now, but we're going to try to stay under that.

And you can see that for For 2020 and 2021, we didn't have a rate increase in 2021 and then 3.9% in 2022. So some of the rate increases that we're proposing for the next two years represent a little bit of catching up for the impacts of inflation.

Next slide, please.

So just to provide a little context for what these percentages mean for a typical residential customer and an average resident, their bill would be about $80 a month and a 4.5% rate increase would be about $4.

I just wanna quickly acknowledge that there's a typo on the slide that somehow got past all of our review that you can see that the rate path that we provided in the bottom half of this table for context, the four numbers, the 3.5 should be 3.0.

So sorry about that.

And please make a note of that.

So for a residential customer, the rate increases that we're talking about translate to three to $4 a month.

And then for customers who are enrolled in the UDP or utility discount program, they receive a 60% discount on their bills.

And so these rate increases would be $1.50, $2 range.

For small businesses, medium businesses, also provide some context there for what those rate increases would look like for them.

So thanks, Steph.

Being a municipal electric utility, and we serve the community, acknowledge that any increase to utility electric bills impacts affordability for our residents and for businesses in our community, and that these impacts are felt disparately for different members of our community.

And so just wanted to take one slide to highlight some affordability programs that we offer here.

So we mentioned the utility discount program and that's an ongoing 60% discount.

We also have several programs for income eligible customers to help customers who are behind on their bills.

And we know that this is an issue right now for approximately 40,000 of our customers.

And thank you, council member, At the beginning for your PSA reminding folks that we will be we are actively out doing outreach to customers who are behind on their bills.

But we are not demanding payment that that really what we're doing is offering assistance, we have the emergency bill assistance program that provides a credit of up to $1,000 for households, as well as federal programs that can offer.

credits to help with heating expenses as well as the new Washington State program that can provide funding as well.

So we have a lot of help for customers who are behind on their bills and we really do want to work with folks who are behind and help them get caught up.

And then even for all customers who may not qualify based on income, we have bill payment programs and we're looking to help customers put together a payment plan that can extend from 60 days up to two, even three years to help them get caught up on their bills.

And both City Light and SPU, our late fees are waived until June of next year.

And so we really do want to help customers get up to date with their bills and we have a lot of programs to support them.

Oh, and if anybody who's listening in, Google Seattle.gov utility bill help, and that'll, we have a nice web page that will tell folks about these programs.

All right, finally, I've got just one slide that's a bit of a sneak peek on what happens next.

City Light strategic plan is the foundation for our budget and our rates proposal.

And so as City Light will be, the whole city will be moving into budget in September.

And so we are aiming to have approval for the strategic plan.

And then we'll be bringing forward a rate ordinance that will set rates for 2023 and 2024 that align with the strategic plan.

And The increases for customer classes and for individual customers will vary from that 4.5% average because we're going to be taking into account cost of service and some rate design changes.

So there'll be a big ordinance coming in.

I think we're aiming to bring this to committee on August 10th.

And we also have some exciting stuff coming up with rate design, a time of day rate option that we've been working on for some time.

So we're excited to bring that back to committee in August.

So that's all of my slides.

Is this where we turn it over to Scott?

I think so.

Okay.

Okay.

I was introduced this is Scott with the again with this city light review panel.

Our strategic plan is really a team effort between city light staff and our, our great review panel which is nine community members who work hand in hand with us on putting this plan together and so thanks Scott for being here today and talking with us.

Thank you.

committee chair Nelson and committee members.

I'm Scott Haskins.

I'm sitting in for the chair of the panel, Michael Hanson, who is not able to be here today, but we all participate heavily in this process, as I think that city council staff and budget office would attest.

And so it's a privilege to be here.

Just one quick note about the panel is that for the nine member panel, Five members are nominated by the mayor's office for by the city council, I was one of those city council nominees, a couple years ago, and each represents a different customer group, my particular role is looking out for financial analysts or financial status.

and so I bring some expertise in that regard.

I'd like to turn to the strategic plan itself with some brief comments, and I have five quick takeaways that I'd like to mention, and these come from the panel's letter to Mayor Harrell regarding the plan itself and the update.

And that is attached to the agenda.

Excuse me.

Pardon?

For the public, that is attached to the agenda.

Yes.

First, I'm pleased to confirm to you that the panel has unanimously endorses the strategic plan update, as well as the associated rate path.

Secondly, We, in our due diligence and our involvement with the utility, we believe that the utility has charted a course that keeps rate increases as modest as possible while maintaining basic services, basic core services for customers, as well as making necessary investments of capital to the infrastructure and the system.

Um, we think that the commitment to keep rates low is, uh, and, and, uh, the practices we've observed in that regard are impressive and very important to the review panel.

Um, we recognize as you do, the third point, um, is that these are very turbulent times.

Uh, we've heard today about inflation we've heard about, and we're dealing with city Seattle city light with supply chain issues.

We're dealing with, with the economy and we're finding that these costs are very difficult to project with certainty that there are risks and that managing in that uncertainty and turbulent times is gonna be an important feature that the utility tackles going forward.

We've also observed though, in our analysis, that the utility is aggressively working on workforce issues.

They have a high vacancy rate, but they're working on recruitment and employee development and organizational change management.

They're quite focused.

We've heard several presentations on race and social justice program, both with regard to the internal, as well as the external community that they serve.

And we think that, Our role also going forward is to monitor some key performance indicators in terms of how they're doing relative to long-term health and projects, hiring, service delivery, overall costs and revenues.

The fourth quick takeaway is that the advisory panel is deeply interested in financial policies, practices, and performance.

These have been a focus of our panel for several years, and there are a couple action items that are in their plan that you can look forward to seeing.

One of those relates to long-term debt strategy for the utility.

We're very interested in that because debt service remains a large component of the rates and having electricity rates that are affordable are very important given the debt position of the utility.

And so having a clear debt strategy is important for the future.

A second action item that you can expect is to hear more from the utility later this summer on rate design back in 2019, Uh, the review panel at the council's request submitted a report regarding the desirability of updating city lights rate design.

Uh, this was right before my tenure, uh, on, on the panel, but we understand that the utility will be coming forward, uh, with the design proposal later, uh, uh, for you, uh, this summer, and we're going to be monitoring that closely.

The last, uh, takeaway and point that, uh, I'd be remiss if I didn't mention was just how impressed we are with utilities current management and leadership.

Deborah Smith, as well as her very capable and deep staff has a great amount of energy.

uh, competence, leadership, and, and they're very commute, uh, committed to change and improvement.

Uh, they want to make things better and that's evident to us in all the discussions we've had further.

I would, I would just add that, um, we don't just go review things and give an opinion.

We participate actively in discussions with them.

We raise issues, we raise questions.

Uh, we have comments and, uh, Without exception, all of those are taken seriously and addressed.

So we feel very much a partner in the development of the plan as well as understanding the important role we have in reviewing the plan.

So with that, that concludes my remarks for today and be happy to speak with you about any questions that you may have.

Well, thank you, Scott.

It's good to know that the expert watchdogs are happy.

and I second your comments about the leadership of Seattle City Light.

And also thank you City Light panelists for your detailed overview of the strategic plan.

Again, those documents are linked on the agenda.

I see that Council Member Herbold has a question and then I have a couple as well.

Council Member Herbold.

I do not.

I'm sorry.

I don't have my hand raised.

I don't quite see what you're saying.

Thank you.

I might, but not right out of the gate.

For some reason, my cursor made a little hand thing.

Anyway, I do have a question.

On page three of the PDF that's on the agenda, one of the drivers of increased revenue requirements is an increase in annual transportation electrification incentives.

and to around 5 million on top of the current 2 million.

And I'm just wondering if that will, and you touched on electrification, I mean, on electric vehicle charging stations.

So I'm assuming that, is it correct to assume that a large part of that increase will be going to your electric charging stations?

If the answer has a number in it, I'm gonna ask Kirstie to respond.

I can speak to it as well and say, yes, council member.

So as you know, our transportation electrification strategic investment plan is now in implementation mode.

And I think we've shared, at least with some council members that I think we shared with all of you that we are we are piloting right now are a residential street charging program.

We're also rolling out a multifamily program.

And I think what you'll see is that with appropriate funding, the money that we have for 2022. But going forward, the increased funding for this activity, our goal is to really be out there providing incentives and encouraging folks to adopt electrification.

We're also really looking, I want to make clear, and we have some very preliminary plans, but this is an area where we are laser focused on the equity implications.

We certainly understand that it is often our most economically affluent customers who can afford electric vehicles.

And so we are looking at a host of other opportunities, including electric bikes and other things so that we can provide benefits and access to all of our customers.

So more to come on that.

And I think what you will see is we will continue to share out with you as we launch new programs and expect to see those this year and next.

Kirstie, did you want to add something to that?

Yeah, I just that you it's a great question.

Thank you.

And that you're right to observe that those incentives that $5 million is money that we're looking to get out into the community.

So it's, you know, we are building charging stations, but we're also looking to work to build charging infrastructure all over the community.

So those that is dollars that we will be getting out into the community.

Thank you.

This is a topic that I'm very much interested in because our Our Seattle climate action plan does say that it has a goal that 15% of passenger cars in Seattle should be running on clean electricity by 2030. And that's about 600, no, 60,000 vehicles.

And I think there are about 15,000 vehicles right now that are electric on our roads.

So we've got a ways to go.

And one way to get there is to expand our EV charging network.

So thank you very much for your work on that.

We also have to recognize that the utility and the rate payers can't afford to do all this work and make sure that these charging stations are accessible everywhere on our own as a city.

So we're going to have to also incentivize private vendors as well.

And I'm working on some legislation for that.

So stay tuned on that.

Well, Council Member, just if I could, you've just touched on something really important.

That is our strategy.

Our strategy in general is to lean into private sector and we have made changes in the way we approach.

We have a desk that deals full-time with the requests and asks from that network of charging entities because we feel like having them come in and then what we intend to do is to continue to use public funds to fill in the blanks.

So, you know, where are there are there locations and areas in our service territory where for whatever reason, the private sector is not as interested, that's where public charging becomes critically important.

And we will continue to fill that need.

And we will also be continuing to look at whether the notion of charging stations, for instance, at community centers, is that feasible at those locations where there is room, et cetera.

So we are fully aligned with your goals there.

And I think we're all on the same page.

Council Member Herbold, you have a real hand up.

I certainly do.

Thank you so much.

Just a few questions about restarting collections.

On page 11 of the strategic plan, it says that Seattle City Light will be restarting collections practices as pandemic measures sunset.

And the central staff memo says that restarting collection practices means shutting off power for unpaid bills after attempting to get customers with unpaid bills to avail themselves of assistance and payment plans.

Slide 18 of your presentation includes information about a variety of bill payment supportment support programs and I'm just wondering, can you explain if some of these programs are going to be sunsetting and when and how you're going to prioritize accounts for collections.

measures you will be taking up not only to avoid collections, but as we all agree, to avoid cutoffs of electricity for unpaid bills.

Let me take a stab and then Kirstie, you fill in the blank.

I think in general, so first of all, what's really important to know is that we are not interested in shutting customers off.

What we are interested in is having conversations with customers.

So we're really going, we will feel successful if in fact we don't shut anyone off.

Because what we want is we've got a plan in place that offers very, very generous custom tailored payment solutions to customers.

All we need them to do is contact us.

So I think, you know, you all can really help us in that sense as constituents come to you, et cetera.

You know, we're going to work with them.

We have I think staff has done an amazing job.

I take no credit whatsoever, but we we wound up at both Seattle Public Utilities and at Seattle City Light with really top notch folks who've developed a plan that is really one Seattle based.

So we have a shared page for information.

We are working with customers collaboratively.

They already come into the same contact center.

So we have aligned our programs as best we can.

We're gonna be doing all kinds of things, applying money on the backend as we receive funds from the state, continuing to provide emergency assistance funds.

And I think we have legislated that so that we can continue at the higher level through at least this year.

Right now we have prioritized based on dollars.

So right now we are only actively working and communicating with customers who owe us over a thousand dollars.

That's the plan for all of 2022. I expect that as time goes on, we will move closer to our old threshold, which was $300, but we have no timeline associated with that.

What we've done at this point is simply to say, this is where we're starting.

We're going to learn from our experience, learn from the outreach, and we don't have, we have thoughtful, we think about sunset dates, but again, we are at the very, very beginning of this process.

And we're really most interested in seeing what's successful and then making tweaks to our program offerings as we need to in order to encourage customers to call us and make arrangements.

So I don't know if that answers your question, but it is very customer focused.

And we are, I think it's always good to notice and make sure you all know that we did a lot of work with UDP customers on the back end last year, this year and last year.

We applied the monies that you graciously gave us allocated to us out of the Corona relief funds.

We applied those on the back end to those customers who needed the most help, which means they didn't have to take any action.

We also applied additional emergency assistance funds at both the SPU and City Light bills.

And so we will continue to prioritize our lowest income customers and ensure that they are not jeopardized while we work on these larger balances to bring them down.

The other thing that's always worth noting is we do have a responsibility as a public utility who serves all customers to make efforts to collect past due receivables.

And so we are doing that and we feel good about that.

But please know that we have financially reserved most of that large amount, which means there isn't.

And that was in last year's financial statements, which means that as we recover funds, assuming that we do, and I know we will, As we recover funds, those actually benefit us, but we've actually already reserved the funds.

So we're not at risk of a big write-down for past due or uncollectible receivables.

That's already been taken care of.

Yeah, I guess a follow-up.

I'm just, again, returning, not on the spot, Eric, but returning to the special staff's memo.

It says, Again, that restarting collection practices means shutting off power for unpaid bills after attempting to get customers with unpaid bills to avail themselves of assistance and payment plans.

So I'm just trying to get a little bit more clarity on how and when the current practices, which are, you know, obviously they're COVID emergency related practices, where you have agreed to not shut off people's utilities, how we can expect those to change and evolve?

So, as you know, the moratorium on shutoffs and the mayor's office allowed that executive order to end in April.

So right now we are simply communicating with people.

The soonest we would be shutting any customers off is April or later.

Our hope was that we could work, we could incent as many customers as possible to contact us before we go into what is a normal winter weather moratorium, which generally would happen November, December.

As soon as we start to see temperatures drop, of course we don't disconnect customers.

So we wind up with a fairly big gap.

So the idea here, and I know that you want a more definitive answer, then maybe I'm able to give you a council member.

And I apologize.

And one thing we could do is we could provide a briefing to you with SPU because our plans are very well aligned.

And I know you continue to track on SPU.

So that would be something that we could do.

So what Eric has provided in the memo is a definition.

So it's a definition.

What do credit disconnects mean?

And that is where they ultimately go.

But again, in this instance, we think we will be able to proactively, most customers will be incented and they will reach out to us and they will make long-term plans, depending on the amount that they owe us.

Some of the customers will be offered up to three years to repay these past two bills.

So we're really trying to lean in and create something that works for them.

where they feel empowered and in control and able to pay those bills off over time.

And so in terms of when that ends, there is no date identified.

We're just going to be tracking how well we do and then making decisions, which of course, we'll come back and talk to you about if and when we choose to move that number down.

And that's really the best I can give you because we are in unchartered territory.

And again, if we're successful and our current plan results in a lot of activity, a lot of customer call-ins, then that's what we'll stick with.

Because again, that's the goal.

I think that you know, and folks generally know, that we have not, at City Light, we have not disconnected customers for nonpayment since 2016. So for us, it is a really heavy lift to get back to that.

We not only need to work with customers who accrued large overdue patent bills because of COVID or the economic impacts of COVID, but we also need to work with customers to retrain them and to re-incent them to work with us because we hadn't been doing that and we are very mindful of that.

I mean, I think as Scott mentioned, Scott Haskins, you know, our business strategies, improving the customer experience is one of our top business strategies.

So we really want to do this in a way that feels respectful to customers.

That's why we're working with a lot of community organizations, trying to work with people who can talk.

We've got all of our materials are available in many, many languages.

So we're really trying to meet community where they're at to solve this Move this issue forward.

I really appreciate that and I appreciate the opportunity for a briefing on yours and SPU's work in this area.

But I just want to, I mean, you're saying on one hand that there have been no shutoffs since 2016, and on the other hand, there may be shutoffs.

So I want to understand what the policy is going to be.

Well the policy is that customers who are not responsive to us.

So as we have started to roll out and this is something that's quite detailed and in addition to a briefing we can offer you some written materials that show it more clearly the timeline and I think SPU and City Light are on the same timeline so we'll, we'll take that and as a as an assignment and make sure you get that.

But again, as I said, it's August where there could be customers who have not reached out to us at all, who have been non-responsive to our attempts to communicate with them, who at this point have a past due balance of over $1,000.

Those are the folks that could wind up receiving shutoff notices late this summer.

Okay.

Thank you.

I appreciate the offer and I'll be taking up on it.

Really appreciate it.

Thank you.

Eric, do you have anything to add to that or I anything else in the strategic plan.

No, the only thing that might not have been mentioned is that, as I understand it right now city light with the other utilities, including SPU and the state are waiting to hear from the Department of Commerce about the amount of the awards.

There's $100 million set up in the arrears fund.

It's a significant amount of money.

My best guess is that our utilities will receive a large share of that.

That will help a lot toward helping customers that are experiencing difficulties with their bills as a result of COVID.

So there'll be an opportunity to be briefed about, like, what did the utilities get?

how's it being delivered?

And I think this committee or perhaps customers individually can look forward to some briefings on that.

Deborah, I hope I got that mostly right.

No, that's absolutely right.

And thank you for bringing that up because what's true is the Corona relief funds that the city offered us, that the city authorized last year had to be applied and could only be applied to City of Seattle customers just due to the nature of the funding flow.

What we appreciate and why this, what Eric just mentioned is critically important, two reasons.

One is we believe we will receive a fairly significant amount of funding because in this instance, those funds are restricted and they need to be used for, there is a requirement that the past due balances be accrued after a set date.

And many of our sister and brother utilities across the state began resuming collection activities prior to that date.

So that means they won't be eligible for funds.

And so we have learned that, and we think more funding will go to us.

The other thing that's critically important about this is that it will allow us to do the kinds of things on the back end for customers, especially low income customers, who qualifies for these fundings, who are in our suburban franchise cities.

So we weren't able to offer any help to those customers, and we will be able to use the state funding to bring those folks as current as possible as well.

And we believe that the combination of those two things will at least allow us to have most of our lowest income customers in a good place.

And then of course, UDP is prospective going forward.

So if we're able to clean up past due balances, they're continuing to benefit from the discount.

We at least believe we can keep those customers out of a collection cycle.

So the staff members who are working on this, Leslie Brinson from SPU and Catherine Eisenberg from Seattle City Light are tracking that very closely.

Okay, thank you very much.

We're behind schedule.

If there aren't any more questions, I'd like to move on.

Let's see.

So will the clerk please read agenda item three into the record?

And thank you very, very much panelists and Debra, excellent.

Again, we'll take this up again on the 13th.

And in the meantime, I encourage everyone to get questions to City Light.

Council Member, if I could really quickly, just a note that came to me.

The Transportation Electrification Strategic Investment Plan, it's coming just with an update to committee on July 27th.

So if you have specific questions or areas that you want us to cover with respect to those incentives, et cetera, If you'll have your staffs let us know, we can make sure that we cover that when we bring you the overall update.

Thank you.

Okay, go ahead.

Agenda item number three, CB120349.

an ordinance relating to the City Light Department advancing certain objections of the treaty between the United States of America and Canada relating to the Skagit River and Ross Lake and the Seven Mile Reservoir on the Pend Oreille River, authorizing the City Light Department to accept grant funds from the State of Washington Department of Commerce and execute the related agreement for and on behalf of the City of Seattle, authorizing the City Light Department to excuse, to execute an agreement with the Skagit Environmental Endowment Commission to convey the grant funds received from the State of Washington Department of Commerce and certain city-like funds in contribution towards the Skagit Environmental Endowment Commission's payment for the mining company's surrender of mineral and related rights, and ratifying and confirming certain prior acts.

For briefing, discussion, and possible vote.

Thank you very much.

This item needs no introduction from me besides the teaser I gave at the beginning of the meeting.

So I will let you take it away after you introduce yourselves.

And because we are running late, I wanna confirm that my colleagues can stay through the end of this item because we're down to three.

Is that okay?

Seeing no objection.

So I won't take any time then either council member, and I'll just turn this over to staff, but this is super exciting and we are really appreciative of your willingness to stay, because this is something that the city of Seattle can and should feel very good about our ability to help influence a long-term outcome for our state.

So with that, I'm going to turn it over to the team.

Thank you.

Good morning, council member Mike Haynes, I'm the assistant general manager with Seattle City Light.

Maura Brugger, director of government and legislative affairs for Seattle City Light.

Kate Engel, I'm the Science Policy Manager at Seattle City Light and also serve as the US Secretary to the Skagit Environmental Endowment Commission.

Go ahead.

So good morning.

I'm very happy to present this piece of legislation to you all this morning.

It's a very exciting time for City Light and for the Skagit Environmental Endowment Commission and for the province of British Columbia right now.

As it sinks in with the US and the country of Canada, there'll be large celebration at those levels of government as well.

So a little bit of background on what we're talking about today.

I'll be talking about the High Ross Treaty and Agreement that provides the foundation for the decision to be made today.

I'll also be talking about the Skagit Environmental Endowment Commission, which came out of that treaty.

and the infamous donut hole, which some of you may have read about.

I'll explain what that is.

Then I'll pass the presentation on to Maura Brugger, go over the history of threats and actions to protect the donut hole, as well as the current status of those actions and the purpose of this ordinance.

Thanks, please.

So a little bit on the High Ross Treaty.

As most of you are probably aware, there's three dams on the Skagit River.

The last dam that was constructed and the northernmost dam is the Ross Dam.

It's a kind of uniquely constructed dam that was designed to be heightened at several different stages to get to what they call the high Ross stage.

That is the point of controversy here.

The dam was started to be constructed about 1937, and it made it through the first couple of stages to stage three in about 1936. 1950 or so, and then in 1970, CLC Light pursued increasing the height of the dam, the last stage, phase four, and that's where everything started to blow up.

So what that meant, if CLC Light had increased the dam at that time would be that the reservoir Ross Lake Ross Reservoir above the dam would have been extended up into Canada about three miles flooding the Skagit River and surrounding lands.

And that was not, that was a problem particularly brought forth by the conservation organizations on the BC side of the Skagit watershed due to the environmental damage that would be occur because of that flooding.

So this controversy ended up being settled in 1984 with agreement between the city of Seattle and the B.C.

province and then supported by a treaty between the U.S. and Canada to make sure that that agreement is fulfilled.

So this agreement is an 80 year agreement and some couple of highlights of it is that on the BC side, first city light would not be heightening the dam and that the BC government would be providing electricity to offset the electricity generation that wasn't realized by heightening the dam.

and at the same time to address the environmental concerns that were brought out by this, they established the Skagit Environmental Endowment Fund with seed money from, hang on, with seed money from the city of Seattle and the BC province.

And that money is being used to support the environmental integrity of the watershed.

And it's being overseen by and administered by what was established as a Skagit Environmental Endowment Commission.

Next slide, please.

So briefly on the Skagit Environmental Endowment Commission, it's a commission of 16 commissioners, eight of which, eight of, yeah, eight who are appointed by the premier, of British Columbia and eight by the mayor of Seattle.

And each government needs to provide administrative support to the commission in the form of two secretaries.

As I mentioned earlier, I'm on the U.S. side providing the administrative support to the commission.

I have a partner on the B.C.

side supporting the B.C.

side as well.

And we work together to provide everything that the commission needs.

These commissioners are appointed on four year terms.

that are staggered.

So there's a constant cycling of new commissioners in and out.

And the administration is kind of the mortar between the bricks and the liaison between the various governments to make things happen.

So the commission is supposed to use the funds from the endowment fund to conserve and protect wilderness and wildlife habitat.

As you can see on the screen there, enhance recreational opportunities.

And I won't go through them all, but I'll point out the third one, which is the subject of today's decision, which is their directive to acquire mineral or timber rights consistent with conservation recreation purposes.

Next slide, please.

This brings me to the donut hole.

So as you can see on the map here, I've got a, we've got a picture of the Skagit watershed and darker color on the left hand side there with a square red box kind of blown up on the right to show the exact location of the donut hole.

The donut hole is the red area on the BC side there.

It's situated between two provincial parks, Manning Park on the right side and Skagit Valley Park on the left side.

The donut hole is a 14,000 acre area that has mineral tenures associated with it most recently.

owned by Imperial Metals and it could not be incorporated into the Skagit Valley Provincial Park as intended because of those outstanding mineral tenures.

So it became the charge of SEEK from its inception to acquire those and retire those mineral tenures so that area could be incorporated into the park for the protection of the very sensitive upper headwaters of the Skagit River watershed.

throughout the rest of the watershed down to Ross Dam.

It's got the protection of this Ross Lake Recreation Area, as well as the North Cascades National Park Complex.

So it kind of complete the circle.

Next slide, please.

So as so eloquently put by Tom Uniac in his comments at the beginning of this session today, the upper Skagit watershed, the entire Skagit watershed is of local, regional, national significance on both sides of the border.

That's what was the cause of all the public outcry when all these different activities have been proposed because of the potential impacts to it and what it provides.

Watershed provides 30% of the fresh water flowing to Puget Sound.

It has the largest and healthiest populations of threatened endangered steelhead and Chinook salmon in the region and the United States.

Chinook salmon provide 80% of the diet of southern resident killer whales, which are also of regional national importance.

And it also has the most large and diverse population of bull trout, 90% of which spawned above Ross Dam and is critical for grizzly bears and spotted owls and so forth.

So the threat of mining within those, the mining tenures of the Donut Hole present a significant threat to the river as the toxins from mining would cause significant damage, particularly to the aquatic resources in the area.

With that, I'll pass it on to Maura to talk about what we did to address it.

Thank you, Kate.

I'm not going to go into all the details because it's been quite an exciting past few years.

But as Kate had mentioned, the SEEC had always been intending to secure the mineral tenures and to close up the donut hole in Manning and Skagit Provincial Parks.

The urgency, though, really took off in 2014 with the Mount Polly mine disaster when Tailings Dam failed and 8 million cubic feet of mining waste was released into adjacent lakes, causing horrific environmental damage.

So that really was a catalyst for the SEEC to start to take action, to reach out to the mayor of Seattle's office, as well as to start to engage directly with the BC Premier's office.

on their interest in securing a deal with Imperial Metals to surrender those mineral rights, knowing it was going to cost money and trying to figure out how to get a price out of Imperial Metals.

Then in 2018, things got heat up even further because the BC issued a logging permit.

Sikh was not notified.

The city was not notified.

It also established logging roads.

And so again, there was concern that this was going to make it that much easier for Imperial Metals to begin mining in the donut hole.

The treaty was instrumental in our communications between the mayor's office and the BC Premier's office.

Premier Horgan, who came into office in 2017, took a real interest in wanting to address the concerns and to find a way forward.

to protect that area and close up the donut hole.

Also, as Tom Uniak, who was on earlier with public comment, he led the creation of a coalition that was very successful, strong collaboration with U.S. tribes and First Nations, as well as environmental organizations.

We had engagement from a congressional delegation, state legislature, and of course, the Seattle City Council members were quite active as well in communicating.

In 2019, Imperial Medalists did submit an exploratory permit.

We weren't surprised because the logging roads were gonna make it easier for them to do that.

And so then again, we really ratcheted up our engagement in responding to the permit application.

We also had engagement from EPA Region 10. We had engagement from the National Park Service.

And so, as well as the state agencies and again, all of the coalition members commenting on why that mining permit should not be issued.

COVID shut things down for a while and things were slowed.

There was really no action on the mining permit.

We kept checking, but nothing had happened.

We continued to discuss this with the B.C.

Premier Horgan's office, trying to find a way to have a deal, and Governor Inslee got engaged as well in reaching out to Premier Horgan.

Ultimately, they were able to come to an agreement and engage Imperial Metals.

And in 2022, the Sikh and BC signed an agreement with Imperial Metals for them to surrender their mineral tenures in the donut hole for 19.1 million U.S.

That involved both Canadian contributions as well as U.S. contributions.

And that's why we're here today.

There's just a couple of articles.

We got very good press coverage, again, helping to put pressure on the BC government and on Imperial Metals to find a solution.

Next slide.

So what we're here to do today, First Seek and City Light signed an agreement back in late 2021 because this deal was being discussed and we agreed to 1.25 million from City Light.

The state agreed to 4.5 million.

and they would contribute that via City Light through a state grant.

The legislature took action on that state grant in March of 2022 in the supplemental budget.

We have a draft grant agreement right now that we're prepared to sign when we have permission.

We also sought and received a letter from BC Minister Heyman.

He's the Environment and Climate Minister for British Columbia.

to Mayor Harrell making clear that their intentions are to be able to close up the donut hole and permanently protect it with the surrender of the mineral rights, which has happened.

And so this ordinance before you today, thank you for staying.

is to execute the grant agreement.

So it authorizes us to sign the grant agreement with the state, accept the state's payment, and convey that payment to the SEEC, and then to execute an agreement between the SEEC and City Light that addresses the expectations from the funding as well.

That's it.

Thank you so much if you have any questions.

Thank you very much.

This is an amazingly happy ending to years of hard work and in collaboration so I thank you very very much for seeing this to the end.

This is an amazing win for the environment, so thank you.

And fun fact, Tom Muniak, director of Washington Wild, who spoke earlier, is the one who spearheaded outreach to the brewing community because, you know, no clean water, no beer.

So he reached out to many, many, many brewery owners.

And I was one of many who signed a letter of support for this.

So it's interesting to see it come full circle.

All right.

Are there any questions from my colleagues?

Any comments from Eric?

I have no additional comments.

Thank you.

Thank you.

Okay, well then, I am thrilled to move that the committee recommends passage of Council Bill 120349. Is there a second?

Second.

Excellent.

It's been moved and seconded to recommend passage of the bill.

Are there any further comments?

Seeing none, will the clerk please call the roll on the committee recommendation that the bill pass?

Council Member Sawant.

She has left.

Council Member Herbold.

Yes.

Council President Juarez.

Aye.

Chair Nelson.

Aye.

Three in favor, none opposed.

Excellent.

The motion carries and the committee recommendation that the bill pass will be forwarded to the city council on June 28th, 2022 for final consideration.

All right, this concludes the June 22nd meeting of the Economic Development Technology and City Light Committee.

The time is 1139. I really appreciate everybody sticking in here.

Our next committee is scheduled for July 13th at 9.30 a.m.

And if there is no further business, this meeting will now adjourn.

Thank you.

Thank you.

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