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RIGHT.I'LL CALL THIS MEETING WITH THE BAYTOWN MUNICIPAL DEVELOPMENT
[ BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT NOTICE OF MEETING BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT SPECIAL MEETING THURSDAY, JUNE 25, 2020 4:30 P.M. COUNCIL CHAMBER, CITY HALL 2401 MARKET STREET, BAYTOWN, TEXAS 77520 Due to the COVID 19 Disaster and the CDC's recommendation regarding social distancing measures, the public may not be allowed to be physically present at this meeting, as there is a limited amount of space when maintaining the required 6-feet separation from others. For those members of the public that cannot or do not wish to be physically present at the meeting, they will be able to participate through two-way communications. For video conferencing, use the following website www.zoom.com, click on "join a meeting" on the top right hand corner, and input the following Meeting ID: 829 8081 6336. For telephone conferencing please use the following toll-free number: 1-888-788-0099, Meeting ID: 829 8081 6336. Any person, who is participating through video/teleconferencing and is interested in speaking on any item on the agenda, must submit his/her request via email to the Assistant Secretary at cityclerk@baytown.org. The request must include the speaker's name, address, and phone number that will be used if teleconferencing as well as the agenda item number. The request must be received prior to the posted time of the meeting. The agenda packet is accessible to the public in both HTML and PDF formats at the following link: https://www.baytown.org/city-hall/city-clerk/agendas-minutes. After the meeting, a video recording of this meeting will be made available to the public at https://www.baytown.org/city-hall/city-clerk/agendas-minutes. For more information or questions concerning the teleconference, please contact the Office of the City Clerk at 281-420-6504. AGENDA CALL TO ORDER AND ANNOUNCEMENT OF QUORUM ]
DISTRICT SPECIAL MEETING ORDER.IT'S 4:32 PM AND WE ARE IN, UH, COUNCIL CHAMBERS HERE AT CITY HALL.
[a. Discuss and take appropriate action concerning the timing of the financing and construction of the Baytown Hotel and Convention Center Project given COVID-19 and the current financial market.]
ONE ITEM UP FOR DISCUSSION.I WILL, HOPEFULLY YOU CAN HEAR ME FINE, BUT I'M SPEAKING THROUGH THIS MASK.
IT'S TO DISCUSS AND TAKE APPROPRIATE ACTION CONCERNING THE TIMING OF THE FINANCING AND CONSTRUCTION OF THE BAYTOWN HOTEL AND CONVENTION CENTER PROJECT, UH, GIVEN COVID-19 AND THE CURRENT FINANCIAL MARKET, MR. CITY MAYOR.
WELL, THANK YOU, MR. MAYOR, MEMBERS OF THE BOARD.
UM, AS YOU PROBABLY KNOW, UH, SOME TIME AGO, UH, STANDARD REPORTS REQUIRED THAT WE, UH, REINITIATE OR DUST OFF OUR OLD HVS STUDY IN LIGHT OF THE CURRENT EMERGENCY TO REPRO PROJECT, UH, REVENUES FOR, UH, THE PROPOSED PROJECT ON BAYLEN ISLAND.
UH, THE CON THE, THE BASIC CONCLUSION OF THE REPORT IS THAT WE REMAIN WITH A VERY VIABLE PROJECT, ALTHOUGH THE, THE REPORT ALSO NOTES THE TIME THAT IT'S GOING TO TAKE IN ORDER FOR THE CONVENTION INDUSTRY, THE HOTEL INDUSTRY, TO RECOVER FROM THE, THE CURRENT SITUATION.
UH, UNFORTUNATELY, IT PROVIDES US WITH A COUPLE OF YEARS, AS I MENTIONED IN MY PRIOR COMMUNICATIONS WITH YOU, WHERE REVENUES WOULD BE, UH, LOWER THAN WE HAD COUNTED ON, UH, BEFORE.
MEANWHILE, THE COST OF DEBT ISSUANCE FOR THE, UH, HOTEL REVENUE BONDS, UH, WOULD BE HIGHER.
AND SO THE DIFFERENCE BETWEEN THOSE FIRST COUPLE OF YEARS, ESPECIALLY IF WE DIMINISHED FOR REVENUES BASED ON THE PROJECTIONS OF, UH, AVERAGE DAILY RATE AND OCCUPANCY COMPARED TO THE COST THAT WE WOULD HAVE TO, UH, PAY OR RETURN FOR THE BONDS, UH, CREATES A DELTA OR A GAP THAT THE ONLY WAY YOU COULD REMEDY THAT DIFFERENCE IS FOR THE MDD TO STEP FORWARD AND PROVIDE ADDITIONAL, UH, SUPPORT, UH, ASSURANCES GUIDE, UH, AND, UH, CONTRIBUTIONS IN ESSENCE TAKING ON MORE RISK, UH, ESPECIALLY DURING THAT TIME.
THE ALTERNATIVE TO MDD DOING THAT WOULD BE, OBVIOUSLY PLAN B, UH, WHICH IS SOMETHING AFTER MEETING WITH, UH, OUR STAFF, WITH OUR FINANCIAL ADVISORS, UH, SOME OF WHOM YOU WILL HEAR, UH, FROM TONIGHT, IS TO ACTUALLY CONTINUE TO WORK ON SOME OF THE OUTSTANDING ISSUES OF THE HOTEL CONVICTION, UH, CENTER PROJECTS SUCH AS, UH, THE TITLE WORK, UH, OTHER LEGAL, UH, UH, UH, UH, TASKS THAT NEED TO BE PERFORMED, INFRASTRUCTURE WORK, PERMITTING, ET CETERA, BEING READY WITH A SHELF READY PROJECT, UH, IN THE SPRING WHEN WE COMMISSIONED YET ANOTHER HVS STUDY AND, UH, HOPE THAT, AND WE EXPECT THE BOND MARKET TO MAKE EVEN MORE RECOVERY BY THAT TIME.
NOW, WE'RE TALKING ABOUT A FACILITY THAT WOULD OPEN IN 2023 AS OPPOSED TO 2022, UH, GIVES US A LITTLE BIT BETTER OF A SITUATION TO GO AHEAD WITH THE PROJECT AT THAT TIME.
WE'RE NOT SUGGESTING WE, WE PUT THIS PROJECT ON ICE OR, OR CANCEL IT OR ANYTHING LIKE A, LIKE UNTO IT.
UH, WE'VE ALREADY, UH, INVESTED QUITE A BIT IN THIS PROJECT, AND WE WANT TO MOVE FORWARD WITH THIS PROJECT.
UH, WE WOULD BE MORE READY, OBVIOUSLY, IN THE SPRING HAVING ACCOMPLISHED SOME OF THESE OTHER, UH, TASKS.
WE WOULD HAVE A BETTER MARKET, UH, AND PROBABLY A BETTER PROJECTION IN TERMS OF, UH, REVENUE THAT WOULD ALIGN THAN, AGAIN, WITH THE COST OF, OF THE, UH, DEBT AND ALLOW US TO MOVE FORWARD WITH THAT, UH, PROJECT AT THAT TIME.
THAT WOULD BE OUR RECOMMENDATION.
BUT YOU DO HAVE A DECISION HERE TONIGHT.
WE CAN CERTAINLY MOVE FORWARD, UH, RIGHT NOW, THAT WOULD REQUIRE SOME ADDITIONAL SUPPORT FROM MDD, OR WE CAN WAIT FOR A BETTER SCENARIO IN THE SPRING AND DO SOME OF THE OTHER WORK THAT I MENTIONED LEADING UP TO THAT PERIOD OF TIME.
UH, THOSE, I, THIS IS WHAT I NEEDED TO DO FOR YOU TONIGHT, IS FRAME THE ISSUE, UH, FOR YOU.
I HAVE ONLINE, UH, CHRIS JANNING AND JOE MORROW OF, UH, OF HILLTOP.
UH, THEY'VE BEEN KIND ENOUGH TO KIND OF, AND, UH, I'VE GIVEN YOU A HANDOUT.
THIS IS FROM, UH, HILLTOP, AND THEY COULD KIND OF TAKE YOU THROUGH THIS.
THEY COULD ALSO DESCRIBE, UH, NOT ONLY WHAT THAT COMMITMENT LOOKS LIKE FROM MDD TO MARCH FORWARD NOW, BUT ALSO THEY COULD PROBABLY TALK ABOUT WHAT THE MARKET LOOKS LIKE RIGHT NOW, WHAT WE COULD EXPECT IT TO LOOK LIKE PERHAPS, UH, LATER.
AND THEN I HAVE RAY GARFIELD WHO'S GOING TO, UH, ANSWER SOME OF THE QUESTIONS ABOUT WHETHER WAITING IS FEASIBLE, WOULD WE JEOPARDIZE OUR RELATIONSHIP WITH THE FLAG, WOULD THINGS ESCALATE OUT OF CONTROL IN TERMS OF THE COST OF THE FACILITY, ET CETERA.
IF WE WAITED, UH, HE CAN ANSWER SOME OF THOSE THINGS AND
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OTHER QUESTIONS THAT YOU HAVE.AND SO, AT THIS TIME RIGHT NOW, I'M GONNA TURN THE TIME OVER TO HILLTOP AND THEY'LL TAKE YOU THROUGH, UH, THESE FIGURES.
HAPPY TO ANSWER ANY QUESTIONS THEY HAVE IN THE END, BUT AT THE END OF THE EVENING, WE, THE DELIVERABLE, UH, OF TONIGHT IS, UH, SOME SENSE FROM THE MDD AS TO, UH, WHICH DIRECTION YOU THINK WE OUGHT TO MARCH.
UH, AS RICK FRAMED VERY ACCURATELY, UH, WE DID GET THE NEW HDS STUDY IN, UH, THE, THE BIGGEST IMPACT IS, IS REALLY WITH THE, WITH THE COVID CRISIS AND LOWER UTILIZATION IN THE INDUSTRY, THEIR RAMP UP TIME TO GET US TO THE SAME, UH, NORMALIZED OCCUPANCY, UH, WHAT WAS IMPACTED.
AND IT'S GONNA SLOW DOWN THE REVENUE GENERATIONS BY THE HOTEL, UH, PER THE NEW HBS STUDY, UH, USING THOSE HBS NUMBERS, UH, WE, YOUR ADVISOR WORKED WITH CITI, UH, THE, THE BOND UNDERWRITER LIKE WE'VE BEEN DOING.
UH, AND, UH, THE REAL IMPACT, UH, WA WAS NOT TO THE FIRST LIEN HOTEL REVENUE BONDS OR THE SECOND LIEN HOTEL REVENUE BONDS, WHICH WE COULD STILL STRUCTURE COVER AND STILL CAN STRUCTURE COVERAGE TO.
THE REAL IMPACT CAME WHEN WE GOT TO THAT THIRD LIEN.
UH, AND IF YOU'LL, IF YOU ALL WERE RE WILL RECALL, THAT'S THE SURPLUS LAST REVENUE, HOTEL REVENUE CLAIM.
AND IT WAS THE ONE WHERE WE WERE PA WE WERE GUARANTEEING, UM, BY VIRTUE OF A RESERVE FUND AND RESERVE FUND, REPLENISHMENT PLEDGE FROM THE MDD, UH, THE BALANCE OF THE PROJECT FUNDING CERTIFICATES OF OBLIGATION AND THE CITY'S CASH CONTRIBUTION, AS WELL AS THE KEY MONEY, UH, FROM OUR HOTEL PARTNER, UH, ALL REMAIN THE SAME.
UH, I I MENTIONED THAT THERE WAS AN ISSUE WITH THAT THIRD LIEN.
AND IN, PER THE NEW HBS PROJECTION, THERE WOULD NOT BE ADEQUATE REVENUE TO PAY FULL DEBT SERVICE ON THAT THIRD LIEN IN YOUR ONE, TWO, AND THREE, AND REALLY IN YOUR FULL, IN YOUR REPORT, WHILE THERE IS SURPLUS THAT'S AVAILABLE AFTER THE PAYMENT AND OPERATION OF THE HOSPITAL FOR THAT THIRD LIEN, IT, IT IS A, IT ONLY COVERS A PART OF THAT FOURTH YEAR'S PAYMENT.
IF YOU LOOK AT THE HANDOUT THAT, UH, RICK REFERRED TO THAT WE PREPARED, YOU CAN SEE WE'VE LAID THE CURRENT PLAN ON THE LEFT OUT.
WE DIDN'T JUST ACCEPT AND SAY, OH, IT DOESN'T WORK, BECAUSE WHEN YOU LOOK AT IT IN THE OUT YEARS, IT'S A VERY VIABLE HOTEL PROJECT.
UH, UH, IT'S, IT IS BEEN REVIEWED, UH, NOT ONLY BY, UH, STAFF OURSELVES, UH, RAY GARFIELD'S GROUP, BUT, BUT WE RAN IT THROUGH OUR HO, YOU KNOW, WE ASKED FOR INPUT AND INSIGHT FROM OUR HOTEL PARTNER ALSO, EVERYBODY AGREES IT'S STILL A GOOD PROJECT.
IT'S JUST THIS IMPACT OF THE COVID CRISIS.
UH, YOU KNOW, AS YOUR ADVISOR, WE KNOW THIS IS IMPORTANT TO YOU.
UH, WE, WE ASKED CITIBANK, WHAT COULD WE DO TO MITIGATE THE IMPACT ON THE THIRD LIEN? THEY CAME BACK, UH, WE, WE HAD PUT OUR HEADS TOGETHER AND WE AGREE WITH 'EM, WITH WHERE THE BOND MARKET AND BOND INVESTORS ARE RIGHT NOW.
THE ALTERNATIVE, IF YOU WANTED TO CONTINUE TO MOVE FORWARD ON PACE, UH, THIS SUMMER, WOULD BE TO KEEP THE FIRST LIEN AND SECOND LIEN HOTEL REVENUE BONDS.
BUT INSTEAD OF DOING A THIRD LIEN HOTEL REVENUE BOND WITH A VERY LIMITED PLEDGE OF THE MDD SALES TAX, THAT WOULD NEED TO BE A FULL SALES TAX REVENUE BOND OBLIGATION OF THE MDD.
WHEN I SAY THAT, OF COURSE, WE WOULD STILL HAVE A PLEDGE OF SURPLUS HOTEL REVENUES, UH, BUT AS I SAID, INVESTORS ARE REALLY GOING TO LOOK BECAUSE IN THOSE FIRST FOUR YEARS WE HAVE, PER THE HDS, UH, FORECAST, WE, WE HAVE, UH, CASH FLOW ISSUES, UH, AS, AS REGARDS TO PAYING THAT DEBT SERVICE.
IF YOU LOOK AT OUR, AT, AT, YOU KNOW, UH, ONE OF THE POSITIVE EFFECTS OF GOING TO A SALES TAX BOND IS THAT WE DON'T HAVE TO HAVE THE SAME LEVEL OF RESERVE FUNDS.
THE COST OF ISSUANCE ARE A LITTLE BIT LESS.
AND OF COURSE, THE, UH, INTEREST DURING CONSTRUCTION CAPITALIZED INTEREST, WE DON'T NEED ANYMORE BECAUSE THE MDD ALREADY IS COLLECTING ITS SALES TAXES.
SO, YOU KNOW, THAT WOULD BRING THAT, IF YOU WILL, THIRD SERIES OF BONDS DOWN FROM OUR CURRENT PLAN OF 25 MILLION TO ABOUT 22.7 MILLION.
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SOURCES, UH, UH, UH, FOR PROJECT FUNDING WOULD REMAIN THE SAME.UH, THE THE USES ARE ALL IDENTICAL.
UH, AGAIN, EXCEPT FOR WHEN YOU COME DOWN, THE DEBT SERVICE RESERVE FUNDINGS ARE A LITTLE LESS.
THE CAPITALIZED INTEREST GOES DOWN, UH, AND THERE'S A LITTLE BIT OF, OF, OF BENEFIT.
THERE'S A LITTLE LOWER COST OF ISSUANCE ALSO, HOWEVER, WHAT WE AT HILLTOP WANT YOU TO KNOW AND AND TO REALLY FOCUS ON IS BECAUSE THEY WOULD BE MDD SALES TAX BONDS.
NOW TO US, TO YOU, YOU SHOULD REALLY VIEW 'EM AS THEY'RE NOW CITY DEBT.
AND IF YOU LOOK AT THE BOX THAT KIND OF TOWARD THE BOTTOM OF THE PAGE, UH, WE BROKE IT OUT IN, YOU KNOW, OUR, OUR PLAN ALL ALONG IN, IN THE PLAN, WE REALLY THINK IS STILL VIABLE IN THE LONG IT, YOU KNOW, IT, AS LONG AS WE CAN WAIT A LITTLE LONGER TO LET THIS CRISIS RESOLVE ITSELF, UH, WE REALLY HAD 71% OF THE CAPITAL COMING FROM HOTEL, PURELY HOTEL SUPPORTED CAPITAL, WITH 29% OF THE CAPITAL COMING FROM CITY SOURCES.
WHEN, WHEN YOU, WHEN THE CITY, IF THE CITY AND THE MDD WERE TO GO TO THE ALTERNATIVE TO GET THE BONDS DONE IN THIS MARKET UNDER THESE CONDITIONS AND CONVERT THOSE TO SALES TAX BONDS, NOW YOU'D REALLY BE LOOKING AT A SITUATION WHERE THE HOTEL IS PAYING FOR ABOUT 40% OF THE CAPITAL, AND THE CITY'S REALLY AT RISK IN PAYING FOR 60% OF THE CAPITAL.
AGAIN, JUST TO SCOPE IT FOR YOU, AS YOU ALL DELIBERATE, UH, THE, THE, THAT SALES TAX REVENUE BOND ISSUE, THAT, IF YOU WILL, THAT THAT THIRD, UH, SERIES OF BONDS HAS A PAYMENT ANNUALLY OF ABOUT 1,000,001, ONE EIGHTY SIX.
UH, THERE ARE CERTAIN THE NEW HBS STUDY WOULD HAVE SURPLUS CASH FLOWS, NONE IN YEARS, ONE, TWO, AND THREE, A PARTIAL ABOUT $600,000 OF SURPLUS TO HELP OFFSET THAT PAYMENT IN YEAR FOUR WITH A PROJECTION THAT IT, THESE HOTEL REVENUES WOULD BE ENOUGH TO PAY THE FULL, UH, SALES TAX REVENUE BOND ISSUE BEGINNING IN YEAR FIVE.
UH, JOE AND I, WHEN WE, UH, ADVISE CLIENTS AND AS REGARDS, YOU KNOW, WHAT'S, WHAT'S A SAFE LEVEL, IF YOU WILL, OF COVERAGE, UH, YOU KNOW, IF YOU WERE GONNA TREAT THE HOTEL SURPLUS REVENUE AND SAY, YOU KNOW, TO THE MDD, IT'S JUST LIKE SALES TAX, YOU KNOW, IT'S HOTEL REVENUES, BUT IT'S SAYING THAT IT'S GONNA COVER, YOU KNOW, MINIMUM INVESTMENT GRADE COVERAGE FROM ANY CASH FLOW SOURCE, UH, FOR, FOR GOOD SALE FINANCIAL PLANNING, WE SEE AS ONE AND A HALF TIMES COVERAGE.
YOU ACTUALLY WOULD HIT SURPLUS HOTEL REVENUES AT A LEVEL OF ONE AND A HALF TIMES THAT ANNUAL BOND PAYMENT IN YEAR 10.
SO THAT KIND OF SCOPES FOR YOU ALL.
WE HOPE, UH, YOU KNOW, IF YOU WANTED TO MOVE FORWARD AND IF YOU WANTED TO MOVE INTO THIS, UH, THIS NEW COVID MARKET AND THE NEW REALITY OF THIS PANDEMIC, UH, WHAT IT WOULD TAKE, THAT'S THE END OF OUR PREPARED COMMENTS.
ANY COUNT, UH, QUESTIONS FROM MEMBERS OF THE BOARD? YEAH, I WAS GONNA ASK GARY, GARY ENGLER SINCE HE'S ONLINE, IF YOU HAD ANY QUESTIONS SINCE HE'S, WE WE'RE KIND OF HARD TO, WE DON'T, I DON'T KNOW.
I CAN'T SEE ANYTHING FROM GARY, SO I JUST WANNA MAKE SURE IF HE HAD ANY QUESTIONS FIRST BEFORE WE START WITH PEOPLE WHO ARE PRESENT HERE.
BRANDON, CAN YOU HEAR ME? YES, SIR, I CAN.
I, I GUESS MY ONLY COMMENT WOULD BE IS THAT, YOU KNOW, WHAT, WHAT DO, WHAT KIND OF POSITION DO WE WANNA PUT OURSELVES IN? THERE'S, I I THINK THERE'S SO MUCH UNKNOWN RIGHT NOW.
UM, AND I I, I DON'T RE I DON'T RECALL WHAT'S THE CONSTRUCTION TIMEFRAME.
WELL, PROBABLY AT LEAST 18 MONTHS, ISN'T THAT RIGHT, RAY? YES.
THAT'S, THAT'S A GOOD, UH, GOOD, UH, GROUP OF MONTHS TO FIGURE WE COULD GO FROM GROUNDBREAKING TO OPENING.
SO, SO 18 MONTHS FROM NOW OR, OR, YOU KNOW, 20 MONTHS FROM NOW, WHATEVER, WHATEVER IT IS, UM, 24 MONTHS EVEN.
UM, WHERE DOES THAT PUT US? AND, AND DO WE KNOW WHERE WE'RE GONNA BE AT THAT POINT? IS, IS, IS MY QUESTION, AND I WOULD BE SOMEWHAT RELUCTANT TO, TO SAY, LET'S DO SOMETHING AND THEN NOT, NOT KNOW THAT THE CASH FLOW IS GONNA BE THERE TO SUPPORT IT, AND IS THE CITY PREPARED TO, TO DO THAT? AND IS MDD READY TO, TO MAKE UP THAT DIFFERENCE? RICK, MAYBE I COULD RESPOND TO THAT.
UM, GARY, I THINK THAT, UM, WE'RE, EVERYONE'S REALLY RELYING ON THE NEW MARKET STUDY PROVIDED BY HVSS.
THEY'RE AN INTERNATIONAL FIRM AND, AND ONE OF THE REAL SOLID, UH, MARKET STUDY FIRMS IN THE COUNTRY.
UM, AND WE THINK WE HAVE A REALLY CONSERVATIVE,
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UM, RESPONSE FROM HVS FOR WHAT THAT RESPONSE SAYS IS THAT, UM, IN THE LONG TERM, THIS IS VERY VIABLE HOTEL.WHAT IT SHOWS IS THAT IF WE OPEN THIS HOTEL IN 2022, THAT THE ESTIMATED RATES AND OCCUPANCIES IN PARTICULAR ARE MER AND, UM, AND THAT THE RECOVERY FROM THE, THE, THE NATIONAL OR INTERNATIONAL TRAVEL MARKET, UH, IS FORECAST TO BE SLOW AS WELL, SO THAT EVEN IN OUR SECOND YEAR OF OPERATIONS, 2023, THAT, UM, THAT IT WOULD BE BELOW WHERE WE WOULD FORECAST PRE COVID.
UH, ONCE WE GET BEYOND THAT, UM, THEN WE ARE GETTING THE NUMBERS THAT, THAT, UH, THEY ORIGINALLY FELT LIKE WOULD BE THERE LAST DECEMBER BEFORE WE ALL FACE THIS.
SO, UM, I THINK WE AGREE AS WELL THAT, UH, THIS, THIS CONSIDERATION IS REALLY IMPORTANT AND THE IDEA OF, OF, UM, OF WAITING UNTIL VERY NEXT YEAR OR SPRING WHEN WE SEE HOW THIS, UH, COVID-19 CRISIS RESOLVES ITSELF, UM, IS A SENSIBLE, UH, THOUGHT PROCESS FOR US TO GO THROUGH.
WELL, LET'S, LET'S OPEN IT UP.
I'LL JUST, UH, IF YOU CAN JUST HAVE, RAISE YOUR HAND, IT'S HARD TO SEE KIND OF YOUR EXPRESSIONS.
IT'S CERTAINLY HARD, UH, UH, WHEN, UH, WITH THESE MASKS ON.
BUT IF YOU CAN'T RAISE YOUR HAND, SO ALL YOU CAN BE RECOGNIZED, YES, SIR RAY IS ON ONLINE ALSO TOO, UH, ANSWER ANY QUESTIONS YOU HAVE ABOUT, YOU KNOW, LONG-TERM VIABILITY OF THE PROJECT, WHAT, HOW DOES THAT CHANGE OVER TIME, ET CETERA.
AND HE COULD SPEAK TO THE, UH, ENDURING ENTHUSIASM OF THE HOTEL FLAG, ET CETERA.
YES, MS. SEL, DOES EVERYONE AGREE THAT, UH, IF WE DELAY THAT THE INFLATION, UH, THE COST INFLATION A BUILDING THING IS NOT AN ISSUE THAT IT'S, IT'S, I'M BEING, I UNDERSTAND INFLATION'S RELATIVELY FLAT, SO ARE WE NOT BUILDING A BUNCH OF EXTRA COSTS IN, IS THAT AGREED UPON BY EVERYBODY? UH, RAY, YOU COULD PROBABLY ANSWER THAT.
STEVE, STEVE, RAY AND I HAD A CONVERSATION ABOUT THAT VERY TOPIC A LITTLE EARLIER.
IN FACT, I EVEN INVITED STEVE OUT TO JOIN US.
SO, UM, AND WE TALKED ABOUT THAT.
STEVE, I CAN REQUIRE YOU, I'M ON A SHORT, A SHORT, I'M, I'M, I'M ON.
CAN YOU, CAN YOU GUYS HEAR ME? YEP.
HI, THIS IS STEVE GALLAGHER FROM GARFIELD.
UM, UH, LOOK, WE, UM, YOU KNOW, WE HAD A NUMBER OF CONVERSATIONS WITH, WITH OUR CONTRACTOR.
UM, WE FEEL THAT, UH, THAT THERE COULD BE MODEST, UH, ESCALATION OF COSTS, UM, YOU KNOW, LOOKING, UH, SIX TO NINE MONTHS OUT.
UM, BUT, UH, BUT YOU KNOW, WE DON'T THINK IT WOULD BE IN THE, IN THE ORDER OF MAGNITUDE OF, YOU KNOW, UPWARDS OF 5%.
I MEAN, WE JUST, WE THINK COULD IT BE 1%, MAYBE? UM, LIKELY NOT MUCH HIGHER THAN THAT.
UM, BUT AGAIN, WE DON'T HAVE A CRYSTAL BALL, BUT, BUT, UH, BUT WE THINK IT'S MODEST, THE, THE RISK OF, OF ESCALATION.
AND, UM, WE, UH, WE TALK TO HYATT EVERY WEEK.
WE, WE, WE, UH, WE HAVE A GREAT FLAG AND, UH, AN OPERATOR, UH, PLANNED FOR THIS HOTEL, AS YOU KNOW.
UM, I TOLD HIM TODAY THAT, THAT THIS CONVERSATION WAS GONNA BE GOING ON.
THEIR RESPONSE TO ME WAS UNQUALIFIED ENTHUSIASM.
I, I'M NOT STRETCHING THIS POINT AT ALL.
UH, THE, THE HEAD OF DEVELOPMENT SAID, WE THINK THAT THIS LOCATION, UH, IS, HAS THE BEST OPPORTUNITY OF ANY FULL SERVICE HOTEL PLAN RIGHT NOW FOR HYATT TO MOVE FORWARD.
WHETHER IT MOVES FORWARD THIS SUMMER OR THIS FALL, OR WHETHER IT MOVES FORWARD NEXT SPRING, WE ABSOLUTELY BELIEVE IN THIS HOTEL MIGHTILY.
AND, UH, SO IT'S AN UNQUALIFIED, YES, IT WILL BE HERE WHENEVER YOU DECIDE TO SELL THE BONDS AND BREAK GROUND.
SO WE'RE REALLY EXCITED ABOUT THAT.
THAT SHOULD NOT BE AN INFLUENCER IN HOW YOU GUYS DECIDE TO VOTE TODAY.
ANY OTHER QUESTIONS FOR, EITHER FOR PEOPLE WHO ARE ON THE PHONE, UH, ANY QUESTIONS FOR STAFF OR REGARDING, OR WE NEED, AT THE END OF THE DAY, WE NEED TO PROVIDE SOME KIND OF DIRECTION.
I THINK MY UNDERSTANDING WOULD BE WE COULD, UM, WE COULD WAIT TILL EARLY NEXT YEAR, LOOK AT THE, THE MARKET, WHAT IT MAY BE, SEE IF THERE'S A MARKET FOR, FOR THESE BONDS AS, UH, I GUESS THE FRAMEWORK AS IS UNDER THIS CURRENT SCENARIO PLAN.
OR YOU COULD GO AND PROCEED, UH, WITH HIGHER RISK.
UM, MY UNDERSTANDING IS THAT A LOT OF, OF THE SCENARIOS WHEN YOU LOOK AT THIS OTHER PLAN WAS FROM A VERY, VERY CONSERVATIVE, ALMOST WORST
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CASE SCENARIO ON CASH FLOW AND, AND OTHER ITEMS. IS THAT CORRECT? TO SOME DEGREE.UM, I BELIEVE, YOU KNOW, WE'VE ALREADY SEEN DIFFERENT SCENARIOS OVER THE PAST YEAR AND A HALF WHERE, YOU KNOW, WE WERE, WE WEREN'T GONNA HAVE POSITIVE CASH FLOWS INTO YEAR SEVEN, MAYBE NINE, AND THEN IT MOVED.
UH, THE INTEREST RATES WERE, WERE LOOKING REALLY FAVORABLE.
IT WAS MOVING AS EARLY AS THREE, NEVER WAS IT SOMETHING THAT IT WAS IMMEDIATE CASH, POSITIVE CASH FLOW.
SO WE HAVE TO KEEP THAT IN MIND.
SO WE'RE RIGHT BACK TO KIND OF WHERE WE STARTED, WHERE KIND OF THE YEAR FOUR WOULD MAYBE THE, THAT THRESHOLD WHERE WE'RE IN POSITIVE CASH FLOW.
SO IT'S JUST SOMETHING TO CONSIDER.
UM, I WOULD THINK THAT THE MARKET INTEREST, INTEREST WISE, THE MARKET OVER THE NEXT SIX TO 12 MONTHS SHOULD STILL BE FAVORABLE ON INTEREST WHEN THERE'S A MARKET FOR THESE TYPE OF BONDS.
THAT'S PRETTY MUCH WHERE I WOULD LEAVE IT AT THAT POINT.
BUT, UH, I'D LIKE TO HEAR FROM, FROM Y'ALL'S INPUT, BUT THAT'S LEAST MY UNDERSTANDING THAT THE, THE DIRECTION THAT, THAT MBD NEEDS TO PROVIDE STAFF TODAY IS, DO WE WANNA PAUSE? DO WE WANNA WAIT? THAT THERE, THERE'S A SCENARIO HERE WHERE WE TAKE ON MORE RISKS, BUT WE ACTUALLY SAVE ABOUT TWO AND A HALF MILLION DOLLARS IN THE GRAND SCHEME OF THINGS.
SO THOSE ARE SOME DECISIONS THAT WE HAVE TO LOOK AT.
YES, MS. RADO? UM, I, I, MAYOR, I THINK OVERALL, I, I THINK I'M, UM, I FEEL CONFIDENT, UM, BY WHAT WAS SAID THAT THE, THE HOTEL WOULD BE HERE, WHETHER WE DO IT NOW OR WHETHER WE DO IT, UM, YOU KNOW, FURTHER DOWN THE LINE, I FEEL THERE'S STILL A LOT OF UNKNOWNS RIGHT NOW WITH THE TRAVEL INDUSTRY, WHAT'S HAPPENING WITH, UM, THE VIRUS.
AND, UM, THERE'S ALWAYS RISK ONE WAY OR ANOTHER, ALWAYS RISK.
AND WHEN IT COMES TO OUR CITY FUNDS AND DEBTS BECAUSE OF OUR, IS STILL UNKNOWN, I, I'D WANNA BE A LITTLE BIT PROTECTIVE OF THAT AS WELL.
AND IN WHAT WE MAY NEED TO DIP INTO.
WE WAITED SO LONG FOR THIS PROJECT EVEN BEFORE MY TIME ON COUNCIL, AND, UM, I, I THINK FROM MY, FROM MY PERSPECTIVE, I DON'T THINK THAT IT WOULD HURT US TO WAIT A LITTLE MORE, UM, BECAUSE WE KNOW THAT IT IS A SOLID PROJECT BASED ON CVS, UH, HVS NUMBERS AND, UM, THE PREVIOUS, UM, FIRM THAT HAD DONE, UM, THE RESEARCH AS WELL, I'M VERY, VERY FAMILIAR WITH BOTH OF 'EM.
AND SO I THINK IT'S STILL GONNA BE A STRONG PROJECT WHETHER WE DO IT NOW OR WHETHER WE DO IT LATER, BUT MY PREFERENCE WOULD ERR ON THE SIDE OF CAUTION.
UM, SO THAT'S WHAT, THAT'S WHAT I HAVE.
SO I AGREE WITH COUNCILWOMAN ALVARADO THAT I, I REMEMBER WHEN WE DID THE SENSITIVITY ANALYSIS AND WE RAN AN OPTIMISTIC OR REALISTIC AND A PESSIMISTIC SCENARIO.
AND I CAN TELL YOU EVEN THE PESSIMISTIC SCENARIO DIDN'T ACCOUNT FOR CORONAVIRUS.
SO WE'RE, WE'RE WAY BELOW THE PESSIMISTIC SCENARIO NOW WITH CORONAVIRUS OUT THERE, AND LIKE MS. ADO, I'M OPPOSED TO TAKING ON ADDITIONAL RISK AS A PUBLIC BODY.
YOU KNOW, I WAS SUPPORTIVE OF IT BECAUSE THE HOTEL WOULD ESSENTIALLY SUSTAIN ITSELF.
AND THAT WAS A POSITIVE, I THINK, WITH THIS BODY.
AND I THINK IT WAS A POSITIVE TO SELL IT TO THE PUBLIC AS WELL.
AND I THINK THAT'S WHERE THEIR SUPPORT IS, THAT IT WOULD BE SELF-SUSTAINING.
UM, SO I WOULD LIKE TO TO TO STILL GO THAT DIRECTION IF POSSIBLE.
AND, YOU KNOW, ONCE, IF, IF THERE'S A VACCINE, IT, IT'S GONNA BE A DONE DEAL IF THAT HAPPENS BEFORE THE SPRING, AND YOU KNOW, THAT'S WHAT WE REALLY NEED.
THERE'S A LOT OF BUSINESSES THAT NEED THAT AND A LOT OF INDUSTRIES, ESPECIALLY HOTEL CONFERENCE CENTER PROJECTS.
SO IT'S, UH, I MEAN, THERE'S A LOT OF UNKNOWNS AND I JUST THINK THE SAFEST, UH, MOST PRUDENT THING TO DO IS TO WAIT UNTIL THE SPRING, SUMMER, FALL OF NEXT YEAR, WHENEVER THAT MAY BE.
SO, I, I'M STILL IN FAVOR OF THE CURRENT PLAN, EVEN THOUGH IT, EVEN IF IT MEANS WAITING.
AND MY REASON FOR THAT IS, UM, IN COMPARING THESE TWO PLANS, I DON'T REALLY LIKE THE SHIFT AND HOTEL SUPPORTED CAPITAL AND CITY SUPPORTED CAPITAL FROM THE TWO PLANS.
AND, AND THEN GOING, IF YOU LOOK AT THE SECOND PLAN, DEPENDING ON SALES, TAX, REVENUE JUST SEEMS LIKE NOT A GOOD IDEA AT THIS TIME.
DAVE, ANY ADDITIONAL COMMENTS? OR YOU'RE THE ONLY ONE LEFT.
DIDN'T SAY ANYTHING SO FAR? WELL, I THINK IT, I THINK IT'D BE FOOLISH TO MOVE FORWARD WITH, WITH ANY PLAN AT THIS POINT, JUST BECAUSE OF THE WORLD WE LIVE IN CHANGES DAILY AND, AND WE CAN'T MAKE A PLAN FOR NEXT WEEK, LET ALONE SEVERAL MONTHS DOWN THE ROAD.
I THINK WE JUST NEED TO WAIT AND, AND NOBODY WANTS TO SEE THIS PROJECT, UH, GO SOUTH.
[00:25:01]
WE'VE BEEN WAITING A LONG TIME FOR THIS, BUT I, I THINK WE JUST HAVE TO WAIT.UM, MS. JIM, SO YOU HAVE TO, I, I, NO MORE WORDS NEED TO SAID BY ME.
SO WHAT I WOULD LIKE TO HEAR IS, UM, I, I WOULD THINK FIRST QUARTER, I, I WOULD LIKE TO JUST AT LEAST VISIT THAT WAY.
WE KIND OF START LOOKING AT WHAT DOES THE MARKET LOOK LIKE FIRST QUARTER.
WE, UH, MAYBE, UH, MAYBE THERE'S A VACCINE THAT COMES OUT IN OCTOBER.
UH, I WOULDN'T BE SURPRISED IF THAT HAPPENS OCTOBER, NOVEMBER TIMEFRAME.
BUT, UM, I THINK, UH, JANUARY, LET'S TAKE A LOOK.
LET'S REENGAGE, UH, ALL THE STAKEHOLDERS.
UH, SO I'D ENTERTAIN A MOTION FOR DELAY TO REVISIT, UH, BEGINNING OF, UH, NEXT YEAR, UM, AT LEAST TO, TO BEGIN LOOKING AT THAT REVIEW.
IF IT LOOKS VERY FAVORABLE, THEN WE CAN TAKE ACTION IMMEDIATELY.
IF IT LOOKS LIKE WE'D HAVE TO DELAY A QUARTER OR TWO, THEN WE'LL DO SO AT THAT TIME.
UH, MAYOR, THERE'S, THERE'S NOTHING MAGIC ABOUT HOW MANY MONTHS WE WAIT, HOW MANY, WHAT DAY THAT IS, IT'S CONDITIONS THAT WE'RE LOOKING FOR TO CHANGE.
AND WHEN THOSE CHANGE, WHENEVER THAT HAPPENS NEXT MONTH, THEY COULD.
UH, WE'LL, WE'LL BE BACK AND WE'LL BE, WE'LL BE MOVING FORWARD.
I MEAN, A THERAPEUTIC MAY, MAY DO A WORLD OF GOOD ALSO WITH CERTAIN INDUSTRIES.
SO, SO KEEP IN MIND THERE, THERE'S STILL QUITE A BIT OF, OF, UH, INFRASTRUCTURE WORK THAT WE HAVE ALREADY INITIATED DESIGNS.
UH, THERE IS SOME ADVANTAGE, OBVIOUSLY, TO CONTINUING, UH, OUR, OUR DEVELOPMENT OF THE ISLAND IN TERMS OF ELECTRICAL, THE, UH, WATER, THE WASTEWATER, THE LIFT STATION, ET CETERA.
IS, IS THE BOARD, UH, OPEN TO OUR CONTINUING THAT INFRASTRUCTURAL WORK ON THE ISLAND? OKAY.
SO THEN I GUESS I WOULD ENTERTAIN A MOTION TO DELAY AND TO, AND TO STAFF UNTIL STAFF, UH, PROVIDES RECOMMENDATIONS TO RE-ENGAGE.
SO, UH, I WOULD LIKE TO MAKE A MOTION TO DELAY, UM, UNTIL STAFF MAKES THE RECOMMENDATION TO MOVE FORWARD.
ANY OTHER QUESTIONS OR COMMENTS REGARDING THE MOTION? I, YES, SIR.
JUST A QUICK, YOUR, YOU ASK A QUESTION.
DID WE NEED TO ANSWER THAT RIGHT NOW? 'CAUSE YOU ASKED US, WHY DON'T YOU GIVE US THIS ONE FIRST, THEN YOU CAN, YOU CAN ADDRESS, THEN WE CAN GO BACK TO THAT.
I, UH, SO WHERE WE AT? I'M GOOD.
GARY, DO YOU, YOU, UM, I, I'M ASSUMING YOU HEARD ALL THE COMMENTS, UH, MR. ENGLER? I HEARD 'EM.
SO ALL THOSE IN FAVOR OF DELAY UNTIL STAFF PROVIDES US, UH, WHEN CONDITIONS ARE APPROPRIATE, UH, PLEASE SAY, AYE.
GARY, I'M ASSUMING YOU, YOU VOTED SOMEWHERE IN THERE, RIGHT? I
SO I THINK WE BROUGHT IN THE NEEDED DIRECTION, UH, REGARDING THIS ITEM.
AND SO TO MY UNDERSTANDING, WE HAVE ADDRESSED ALL MDD SPECIAL MEETING.
HIS QUESTION, HIS QUESTION, OH YES.
A VERY RELEVANT QUESTION AND, AND PERHAPS RAY OR ANDREA CAN, CAN WEIGH IN ON THIS AS WELL.
UH, THERE CONTINUES TO BE WORK THAT, THAT NEEDS TO BE DONE IN ORDER TO MOVE TO A SHELF READY, UH, STATUS FOR THE PROJECT.
SOMETHING RAY AND STEVE AND I TALKED ABOUT EARLIER, TO THE DEGREE THAT WE ARE WILLING TO CONTINUE TO MAKE THE INFRASTRUCTURAL IMPROVEMENTS THAT ARE NECESSARY FOR THE FULL BUILD OUT OF THE ISLAND AT SOME POINT IN THE FUTURE, REGARDLESS OF THE HOTEL CONVENTION CENTER, THE VISION, I THINK FOR MDD IS THAT I, THAT ISLAND CONTINUES TO BE A, A, UH, A VENUE, UH, FOR A VARIETY OF USES IN ORDER TO ACCOMMODATE THAT.
YOU REMEMBER THAT MONTH AND MONTH AND MONTHS AGO WE TALKED ABOUT A WATERLINE, A 12 INCH WATERLINE LOOP.
WE'VE TALKED ABOUT ELECTRICAL, WE'VE TALKED ABOUT A LIFT STATION, AND WE MADE PLANS IN TERMS OF OUR DEBT ISSUANCE, OUR COS.
IN ORDER TO PROVIDE THAT SUPPORT, UH, THE, THE, I JUST WANTED TO MEASURE THE, UH, THE, UH, ENTHUSIASM OF THE BOARD TO CONTINUE TO MAKE THOSE IMPROVEMENTS IN PREPARATION SO THAT IN MARCH WE TRULY ARE READY TO, UH, TO GO.
DID I MISS ANYTHING ON THAT? NO, I THINK THAT, UM, NO, THAT'S RIGHT.
UM, WE'VE TALKED ABOUT THIS, UH, EVERY SINGLE WEEK, OUR ENTIRE TEAM, DPR CONSTRUCTION, LOCAL POWELL, KIMBERLY HORN, WHO BY THE WAY, IN HOUSTON, YOU GUYS USE 'EM IN DALLAS.
YOUR STAFF, UM, IN OUR TEAM HAVE BEEN WORKING ON ANY NUMBER OF ISSUES, MAYBE SIX OR EIGHT DIFFERENT.
UM, AND THEY'RE NOT ALL RESOLVED YET.
UM, AND SO OUR DESIRE, AND THIS IS IN CONSULTATION AS WELL WITH, WITH CITIGROUP AND, AND WITH
WHEN WE ARE READY TO GO TO THE BOND MARKET,
[00:30:01]
WE DON'T WANT TO BE STRUGGLING TO, UH, STILL TAKE CARE OF A TITLE ISSUE THAT IS STILL OUT THERE THAT, THAT KAREN HORNER'S WORKING DILIGENTLY ON AND THAT DAVID DAWSON'S WORKING DILIGENTLY ON.WE'D LIKE TO CHECK THOSE BOXES OFF WITHIN THE NEXT COUPLE OF MONTHS.
SO OUR TEAM IS READY TO CONTINUE THE EFFORT, UH, TO DO THAT.
AND I WOULD ALSO, ON BEHALF OF, UH, STEVE
AND SO OUR, OUR ENCOURAGEMENT FOR EVERYONE IS TO ALLOW US TO DO THOSE IN FAIRLY INEXPENSIVE, I THINK VERY INEXPENSIVE THINGS, UM, BUT UM, BUT ARE FUNDAMENTAL TO THE DEVELOPMENT OF THE ISLAND AND CERTAINLY TO THE, UH, THE HOTEL AND CONVENTION CENTER.
HAPPY TO ANSWER ANY QUESTIONS, CHRIS? YES, SIR.
SO I, I CAN UNDERSTAND CERTAINLY TO, TO MOVE FORWARD ON THINGS LIKE TITLE ISSUES.
UM, AND I CAN UNDERSTAND THAT BEING INEXPENSIVE AS OPPOSED TO, YOU KNOW, LIFT STATIONS AND, AND THINGS LIKE THAT.
IT'S, IT'S, YOU KNOW, ARE WE TALKING HUNDREDS OF THOUSANDS OF DOLLARS OR MILLIONS OF DOLLARS? MILLIONS.
AND IT SEEMS LIKE, I MEAN, LIFT STATIONS AND THINGS LIKE THAT, YOU KNOW, TYPICALLY A LOT OF TIMES THEY'RE DONE SIMULTANEOUS WITH CONSTRUCTION AS WELL.
I JUST DON'T KNOW WHAT WE, WHAT WE GAIN ON, ON THINGS THAT CAN BE DONE SIMULTANEOUSLY WITH CONSTRUCTION THAT COST MILLIONS OF DOLLARS.
IT JUST SEEMS, YOU KNOW, THAT'S AN ADDITIONAL RISK.
UM, IT'S SOMETHING TO THINK ABOUT.
THAT'S WHY I WANTED YOU TO GET A NOD FOR ME ON THAT.
I DON'T THINK THAT I'LL, AND I, STEVE CAN BACK ME UP ON THIS.
I DON'T REALLY THINK THAT I'M RECOMMENDING MILLIONS OF EXPENDITURES.
I THINK THAT, UH, WE'D LIKE TO SEE OUR, UM, OUR SECOND, UH, UH, UH, PERMIT.
I CAN, I CAN JUMP, I I CAN JUMP IN RIGHT THERE, THERE, BECAUSE THERE'S, I THINK, I THINK THE, THE BOARD HAS, HAS KIND OF REALIZED THERE'S KIND OF TWO ISSUES HERE.
THERE IS, UM, A NUMBER OF ADMINISTRATIVE ISSUES THAT WE NEED TO DEAL WITH, TITLE THINGS, CONTINUING WITH, UM, WITH GIVING, UH, UH, YOU KNOW, ACCESS EASEMENTS AND DOING ALL THAT STUFF, WORKING WITH CENTERPOINT.
BUT THEN THERE'S THE ACTUAL BUILDING THINGS.
THERE ARE A FEW THINGS THAT ARE RELATIVELY EXPENSIVE.
MOVING THE POWER POLES IS, IS TENS OF THOUSANDS OF DOLLARS, NOT, NOT MILLIONS.
UM, AND, AND THEN ALSO WORKING WITH CENTERPOINT ON THE PRIMARY POWER LOOP.
I DON'T, I DON'T KNOW WHAT THAT NUMBER IS RIGHT NOW.
I THINK, I THINK THAT'S SOMETHING WE SHOULD LOOK AT.
BUT YES, IN FACT THE, THE, THE LIFT STATION IS I THINK ONE, YOU KNOW, 1.7, $1.8 MILLION TO DO LIFT STATION.
I, I, I THINK WHAT WE'RE TRYING TO ACCOMMODATE BY MAYBE WORKING ON THE PRIMARY LOOP AND ON POWER AND THINGS LIKE THAT IS GETTING THOSE THINGS THAT ARE KIND OF IN THE WAY OF GETTING STARTED IN CONSTRUCTION.
GET THOSE, GET THOSE OUT OF THE WAY.
UM, CAN THE LIFT STATION BE DONE WHILE WE'RE DOING CONSTRUCTION? IT? IT CAN BE, BUT IT IS RIGHT AT THE FRONT DOOR.
UM, IT IS RIGHT NEXT TO THE BRIDGE TRYING TO GET TRUCKS IN AND OUT.
IT, IT WOULD ABSOLUTELY BE EASIER IF THEY, IF THE LIFT STATION COULD OCCUR A LITTLE BIT EARLIER THAN, THAN THE HOTEL.
DOES THAT HAPPEN RIGHT NOW? PROBABLY NOT.
BUT, BUT IT BE NICE TO NOT, UH, NOT SELL BONDS AND THEN DECIDE TO START THE LIFT STATION AS WELL.
SO IF MAYBE WE COULD CONSIDER IT A LITTLE LIFT STATION A LITTLE BIT EARLY, THAT, THAT WOULD PROBABLY BE HELPFUL AS WELL.
QUE GOOD? UH, GOOD QUESTION THOUGH.
UM, HOW LONG DOES IT TAKE FOR THE LIFT STATION TO BE CONSTRUCTED? WHAT'S THE TIMEFRAME THAT WE'RE LOOKING AT THAT WE NEED IN TERMS OF LEEWAY AHEAD OF TIME? BOY, I, I, I DON'T HAVE THAT.
IT IS NOT, IT IS NOT, UH, IT'S NOT A NINE MONTH CONSTRUCTION.
IT IS, UH, I I I THINK IT'S TWO, THREE MONTHS.
WE CAN, WE CAN GET THROUGH THOSE EXACT SCHEDULED TIMELINES.
WE'RE, WE'RE ABOUT TO GET UP, WE'RE GONNA GONNA SUBMIT HERE.
I BELIEVE IT WAS 12 TO 15 MONTHS ACTUALLY.
BUT A LOT OF THAT WORK CAN HAPPEN SIMULTANEOUSLY.
SO THIS, THIS MEETING IS NOW ADJOURNED.