Speaker 1: On the record is brought to you by Steve and Adele do follow Speaker 2: San Antonio is a fast growing fast moving community with something new happening every day.

That's why each week we go on the record with the Newsmakers who are driving this change.

Then we gather at the reporters round table to talk about the latest news stories with the journalists behind those stories.

Join us now as we go on Speaker 1: Hi everybody.

And thank you for joining us for on the record.

And this week you may have seen a big news is what bear county is now doing with a public health initiative, starting a public health division to maybe better distribute healthcare across the county.

That's one of the objectives and joining us to talk about that as George Hernandez, president and CEO of university health.

Thank you very much for coming in.

You have so many initiatives or a number of initiatives now for public health.

What is this public health division aim to do?

Speaker 2: It seemed to really this centralize our efforts, you know, we've been involved in public health and a variety of ways.

And the most recent is our vaccination effort at Wonderland mall, where we vaccinated probably over a quarter of a million people, 500,000 doses there over the last year.

And, but, you know, we pull, we pull a staff from different departments to do this, and we think it's time now to centralize that effort, to create a division of public health within the health system, that's that sole purpose will be public health.

You know, we, when there's a hurricane in the Gulf coast, it's our clinical division that comes to the rescue and sets up clinics for the evacuees and things like that.

In this case, it was our it people.

And some of our clinic folks that set up Wonderland, we just need to be more focused on it.

And I think that's the goal of this.

Speaker 1: And people might not understand that university health is what we used to call, and it's still technically bear county hospital district one by the county.

Is this also an effort as I understand it, to deal with the inequities that were exposed in terms of healthcare during the pending?

Speaker 2: Yeah, so, you know, the, the fastest growing area of the county is the unincorporated areas.

I know judge Wolf has been very concerned, so I have the commissioners about addressing healthcare inequity in those areas.

And so our effort will center around those unincorporated areas to try to through try to improve health equity in those Speaker 1: And the south side you're working on as well with a new hospital in the works, Speaker 2: Right?

We have, we have purchased land or we're in the process of purchasing land 68 acres right next to Texas a and M San Antonio.

We chose that site because we can leverage our investment with another public entity, Texas, a and M San Antonio and educational agencies and healthcare work hand in hand in improving health.

They, they trained the next generation of health professionals and we provide the care.

So it's important to be able to create that leverage.

So, so the, the land will be used for this public health function and, and also for a hospital, you know, and that's, that's the goal.

Speaker 1: And what about training through people might think, well, is that going to be a big partnership with Texas a and M San Antonio, a doctor Cynthia 10 Yente there, Mattson who is the president is working to get middle and high schoolers interested in healthcare and going through Speaker 2: That's.

One of that's one of the reasons Randy, that we wanted to partner with Texas a and M because of, because of her leadership in a, her aspire network of, of putting together all those school districts to create a funnel to college.

And it also creates a funnel from Palo Alto, which is down the street from Texas a and M San Antonio.

And he creates a, a pool of labor pool for future healthcare workers.

And we all know with the aging of the baby boomers like me, we're going to need healthcare workers in the future.

And, you know, as we retire out, there needs to be people to replace that.

Speaker 1: And in that area, we had done, you know, stories before this, but especially during the pandemic, we learned about, you know, maybe the lifespan of certain zip codes and parts of town being 15 years shorter than some other parts of town, is that a direct result of healthcare, public healthcare availability in those areas Speaker 2: Probably be a whole host of issues.

You know, they're called social determinants of health.

The, the non, the nonclinical functions, the clinical functions represent, you know, 20 to 30% of, of how you can improve lifespan, but the environmental conditions, the housing, the food, the food, all those things impact a lifespan.

And so we have to work on the social determinants of health to improve health equity.

And, and you know, where I live near the medical center, or there's a choice of three or four, HEBs where I go shop, you know, and in some areas of the county, you know, the, the it's, it's harder to get that fresh.

Speaker 1: You have to go to a convenience store.

There's Speaker 2: Not as much that have the options.

Yes, Speaker 1: The public health advisory board going to do.

Now, this is one of the new things with this push.

Speaker 2: I think what, what the, the interest of the court and the health system is to have, you know, experts serve as a resource for us.

You know, obviously the, the work will be done by the university health.

And I will, I'm going to mention here that David Smith, the county manager has a whole host of departments under his leadership.

That deal with things that are not medically related, for example, vector control, restaurant inspections.

And they'll continue to do that in, in the unincorporated areas of the county.

So they're gonna try to organize as well to try to be more efficient.

We're going to try to organize the medical side to be more efficient and more direct since we've been doing it a long time.

Speaker 1: And the money comes from the American rescue plan act that will, in terms of adding services, 60 million or thereabouts.

Speaker 2: Yeah.

The initially, well, I think that the brigade, majority of that money will be for capital projects.

There'll be some that we'll have to reserve for startup costs, but, but I think that we have in our budget, the ability already through, through the shifting things around not to not to create an initial burden on anyone on initial dollars.

Speaker 1: And COVID, you talked about Wonderland doing, you've got national reviews being great for what has been done there.

How are we doing with COVID right now in the vaccinations and deaths Speaker 2: Vaccination rate in bear county is one of the highest in the state of Texas.

I credit the fact that this is a community where everybody works together.

I can't say enough positive things about both Metro health and well med, who we partnered with as well as the health science center, but primarily Metro health and well, mid on vaccinations, wherever we were, they, they covered the areas we couldn't cover.

Speaker 1: How about hospitalizations now?

Speaker 2: Physicians are down.

And I didn't look at the numbers this morning before the show, but I think they were down significantly from yesterday, Speaker 1: But it's still an issue, especially with certain populations.

Do you tell people if you're older, if you're vulnerable, still mask up, still make sure you're vaccinated.

Is that an issue?

Speaker 2: I think, I think it, I think we're in a period where good judgment about when to mask and when not to mask.

And I went to an event yesterday was primarily all outside.

It had an open air pavilion, no one wore masks and it wasn't necessary.

And, and, and, and a lot of the people there, I know that were vaccinated because they, you know, they talk to me about, about Wonderland being vaccinated, a Wonderland or other places.

And so that has a lot to do with it.

Speaker 1: The last quick question you had said that if you got vaccinated at Wonderland, now you can go through my chart with university health and actually get that online.

So you can just show someone on your phone.

Speaker 2: That's right.

You know, the, one of the great things, if you were vaccinated at Wonderland is you can download that my chart, and you can actually see your vaccination record on that.

And because Mike chard integrates with an apple phone, you can then download or, or, or save, I should say, save your, your vaccination record to, to your wallet on your, on your, on your iPhone.

Speaker 1: Well, I'll do that because I was vaccinated there.

Thank you very much.

And good luck again, this is a public health division, newly formed at university health, Georgia Nanda is the president and CEO.

Thank you very much for coming Speaker 2: In.

Absolutely.

Speaker 1: You may have noticed that CPS energy has been on the news quite a lot recently for a number of issues.

They're going through a change of leadership at the top, and they're also fighting in court to get some of the money back after winter storm, Yuri last year, and the big freeze.

They're also trying to retain some employees here to answer a lot of questions that you might've seen in the news is Rudy Garza.

They interim director, a CEO of CPS energy.

Thank you very much for coming in.

Thank you for having me, Randy.

First of all, the rate hike that people are, are, you know, maybe most concerned about that is going into effect this month and it is about $5 a month plus a fee.

That's correct.

And tell us about that fee.

That's the, The fee includes is included in a little over $5 a month, went into effect March 1st, and we've been getting the word out with our customers to that.

It says that it's going into effect and what they can do if they need assistance from CPS energy, we've got a number of ways that, that they can seek assistance through multiple programs that we have a portion of the base rate increased about 3.8, 5% just pays for, you know, costs of business has increased over the last eight years since we've had a rate increase.

So a small portion they'll bring in about $75 million to allow us to continue to serve our community.

And then we've got a, what we're calling a regulatory asset that the council and our board approved that will help us pay for about $418 million in fuel costs that we have paid today.

And you're fighting for about that much as well.

Yes, sir, from that fuel costs.

Whereas that right now in the courts, We have got a couple of different tracks.

W you know, w we have th they actually combined all the remaining gas cases into kind of one combined, you know, proceeding at, in the core at the courts here in San Antonio, that there, there were going through the motions on that we're doing discovery and going through the normal process of discovery in those cases.

So that's one track.

And then we have a co our, our case against circuit is right now pending at the S at the yes, at the state Supreme court that will decide, you know, and they've asked ERCOT to respond to our request for consideration.

So both of those cases continue to proceed, And you're trying to do some public outreach after some pretty tough articles in the paper, talking about acrimonious board meetings and the politicization of CPS, according to some John Steen, one of the trustees, ed Kelly, a former trustee talking about CPS energy is not at a good place at present will continue to deteriorate unless some strong curative steps are taken.

How do you see that?

How do you respond to that as the interim CEO trying to move on down the road from this turmoil?

Sure.

I, you know, I look at it a little bit differently.

CPS energy has always been a community asset.

You know, there's one line of thought that we need to be independent and, you know, we have our own board and nothing has going to change the, the responsibility.

Our board has to help provide policy direction to myself and our leadership team on the things that we have to do to serve our community going forward.

The, the fact of the matter is Randy, that our, our council, you know, councils change every two years and the expectation of our council members is that they want input.

They want CPS energy when they have input to give us about what they see us doing and how they think we should be serving the community.

They just want us to listen.

They're not Some of those board members aren't on the council air, you know, affiliated with the council.

And one of them was pushing for, you know, are you willing to do an audit right now?

And then there was a little, you know, conflict or at the board meeting, are you willing to do an audit?

We've already put the RFP out for a full, kind of a full review on a number of issues.

You know, what, what is our management structure look like?

And, you know, maybe what are some ideas for, you know, streamlining that, what does our compensation look like for a publicly owned utility?

And, you know, are there ways that we can be competitive to ensure we get the talent?

We need to run our utility, but also we reflect a publicly owned entity.

So there, if you're, if we're going to try to be more transparent, which has been a criticism of CPS energy, quite frankly, in the past, then you have to be open to getting input, you know, from independent entities.

And I think it can help set our strategy for the years ahead.

Speaking of strategy, you've had people pushing you to restructure the rates.

So, and this is one of those big issues where the board is at odds.

Maybe pushing them to be less business friendly from some others say that would cripple CPS energy and the city, because they wouldn't be getting as many people to move here.

You have to have an incentive for businesses to move here.

What are your stand on that?

Well, I think you have to, this is going to be a really complicated conversation with the community.

Our business customers already pay some, a highest rates in the state.

And so we have to, at CPS energy, our job is to ensure that we're competitive on both the residential and the commercial side, residential, where some of the lowest rates in the state commercial, where some of the highest rates in the state.

So we've got to strike the right balance.

Commercial is lower here than residential here.

That's the criticism.

Some of the structural rates are structured.

It's how you use our system.

Our, our commercial customers are more efficient in the way they use our system.

We can plan when they're using the same amount of power for 80% of the time that they're running.

We can plan for that.

So it's lower cost to serve our commercial customers than it is to serve our residential customers.

So how our rates are structured today is a legacy approach to how utility structure rates that go back for a hundred years now, They're, they're pushing to, you know, re look at restructuring.

How long is that going to take, Take probably every bit of 12 to 18 months, the rate advisory committee and so long?

Well, it's because it's a, it's a, it's probably a more complicated conversation than even what we're going to do with our generation portfolio going forward, because you know what I think what the community is really interested in is how do we help our customers who most need the help.

And there are a number of ways that you can do that.

And there are ways to restructure rates that will achieve that objective and still allow us to keep our rates competitive across the board.

So, so that balanced the strike between not becoming, you know, so out of the market, that, that businesses won't want to come here.

We've got to keep an eye on that too.

And so that's why it gets really complicated.

Again, about generation strategy, how to generate the energy.

There's been a push to close the coal-fired plants, spruce one and two or two, at least convert them to natural gas.

And the timeline for that.

Where, what is the timeline for that now?

Well, I think our, our board will be positioned to make that decision.

By the end of the year, the rack is doing a lot of really good work.

They will come forward with the recommendation.

CPO Said, advisory Committee, advisory committee, CPS energy staff.

We have our own, you know, a view of, of the world.

I think we can get there in the timeframe that we need to, to be compliant with the commitments we've made with the city on the climate action and adaptation plan.

But, but our goal is to keep rates affordable, to make sure the power's there when we need it.

I think we can invest more in renewables.

And, and so I think part of the conversation will be about that.

And we've got some older gas steam units that need to come offline probably in the 20, 25 timeframe.

So my position has been, let's just not make this about spruce, the spruce units.

We've gotta look at the whole generation portfolio and really develop a strategy for what, And it looked like there is a lot of debt at the spruce units.

If you have to shut those down, are you looking to keep those open for or convert?

What is the feasibility of converting them to some other to natural gas instead of coal?

I think that the decision on the spruce one unit is a little clear, we'd have to invest about $150 million in environmental equipment.

So I, I think the decision to just cease operations it's Bruce one is probably the right call spruce to, in order to deal with the depreciation that, you know, w would still be out there that we'd have to take a ride off on 750 million.

Well, that's, that's close to a billion dollars, you know, that's correct.

So on that, I think that it makes sense to convert that unit to a natural gas unit.

We can do that for a little over $50 million, kind of reset the depreciation schedule and allow us to reasonably and affordably move into the future.

A couple of issues that people want to know about is, are we going to have a problems with brown outs in the summer?

You know, considering what we had happen last winter, when the demand was so high?

Well, we're already doing the work to prepare our units for the summer that work started in the month of March.

We've got a number of units that we're doing some preventative maintenance to right now, and that's happening all across the state of Texas.

I believe just based on the things I'm seeing, that, that our co has done some policy changes that have happened at the state level.

I believe that we're going to have plenty of power for the summer.

How about Where we would have brown outs.

I know that was an issue before if there are only in certain areas that have they changed Any, any type of brownout situation that happens in a certain area is because of a specific challenge that we're having.

Either you lose a transmission line in the wrong part of the state, where you have multiple power plants that ended up going down in San Antonio or Houston or in Dallas.

And so I Think affecting the areas here, I think is the issue Yeah.

In San Antonio, again, unless, unless we see some type of, you know, major event or, you know, a specific plant that goes down, I'm confident that we're going to keep the lights on this summer.

Well, nice issue, problem, or retaining employees.

What do you do about that?

Well, right now we're doing kind of a, a total compensation review.

And then we talked a lot about this during the right request with the city.

We have lost a lot of, of employees.

We've lost a lot of employees to just normal attrition through the retirement process.

We've lost a number of executives that have taken jobs elsewhere, you know, for, for higher compensation.

And so our job isn't to go out and hire the, the, the executives that we can afford.

We got to go out and hire the best and brightest, which means that we have to structure our compensation in a manner that's going to attract, you know, folks to a publicly owned entity.

Again, our goal isn't to compete with the private sector, necessarily in how they structure bonuses and things that they do to attract talent.

Our, we have a pension system that is, is very valuable to those that are my age, that are starting to think about retirement.

You know, so we have to look at our compensation from a total compensation perspective, and we've got to go out and sell that Just what you're going to have to do with the next CEO.

So you can't say that you're close to retirement age, if you're up for that CEO job, the permanent CEO, but good luck with all of that and CPS energy, we all hope that, you know, everything gets straightened out for the people of San Antonio.

Thank you very much.

Rudy Garza, interim CPO, C E O of CPS energy.

Thanks.

Thank you.

On reporters round table this week, a plan development for just south of downtown.

Well, it is again on hold after the fourth plan for development has now at least been put in limbo and joining us to talk about that is Madison is a staff reporter business writer that San Antonio express news, thank you for coming in.

Thanks for having, and this is the lone star brewery south of downtown on pro bands.

Tell us about the latest chapter in the saga there what's going on.

Speaker 2: So gray street partners, which is a local firm and midway out of Houston, had teamed up to turn that complex into a massive mixed use development with housing, retail, outdoor space, better connections to the river, big project just last week, found out that they were looking to sell all or part of the site that it was back on the market.

This is at least the fourth attempt to redevelop the site.

And it's unclear what that means for plans for the site at this point.

Speaker 1: And this was just last year about this time that they announced it, right?

And it was going to be some up to $750 million plan, a lot of apartments, a lot of retail.

Does it mean that they're looking for other investors to come in because they say, as I understand it, at least part of it, they could develop locally gray street.

Speaker 2: They could stay involved.

It's unclear whether they're looking for more investors or what the impetus for the sale was midway.

Didn't respond to questions about what prompted this.

And, and it's unclear if gray street and midway will remain involved in some capacity, gray street executives have said they want to, but everything is up in the air.

This, Speaker 1: This could be related to the partnership that they had, or there was some kind of deal for Broadway development across some of the Pearl between midway and gray street.

And they kind of fell out over that.

Speaker 2: Yes, gray street in midway had teamed up on a similar, somewhat similar project across from the Pearl on Broadway, again, a massive mixed use development.

And then grey street also put that property on the market and midway sued gray street over the right of first refusal to develop the project on the site at midway later dropped the lawsuit, but that could have damaged the relationship between the partners.

Speaker 1: And this is what's going to be the lone star district in that particular property, but that whole area south of downtown Provent Roosevelt, that's still being developed and it's still hot properties.

Speaker 2: Yes.

There are a lot of developers that have bought properties in that area that have planned apartments or similar mixed use sites around that area.

So it's definitely still drawing attention for my article about Lonestar.

I talked to two developers, David Adelman, and James live shoots who have bought property recently at that area.

And they both said the lone star sale doesn't affect that.

They think it's a great growing area with a lot of potential.

Speaker 1: And those guys are second and fourth generation or third generation.

I think developers here in San Antonio develop some other things.

So they have the backing, in fact, a lift shoots as well as working on the hot Wells area, or has that, do you think some, some of this is kind of land banking that they're getting in early, they're owning this property and figuring it's going to be worth more down the road?

Speaker 2: I think it definitely could be.

Yes.

Development just seems to be going further.

South people are moving further south around blue star.

There are a lot of apartments, a lot of construction going on, so it could be the land baking, but they know it's a good investment.

Speaker 1: How has the apartment rental market here in San Antonio right now?

Is it, is it good still for young urban professionals that we used to call them millennials now, instead of yuppies Speaker 2: Rent, like housing prices have gone up quite a bit during the pandemic.

So renters are having a tough time too, just with escalations during the pandemic and that whole downtown area downtown and around downtown is really hot right now.

And so those are some of the higher rents in the city.

Speaker 1: And what do you expect to happen in that area with Lonestar?

I mean, this was only the fourth development, at least that I remember, and you've probably covered Speaker 2: Well, I'm eager to see what, what happens, how this all shakes out.

As you just mentioned, this is the fourth attempt to redevelop that site.

And so I'll definitely be watching to see what happens with the land.

If new partners come in, if gray street and Midwest stay involved in some capacity Speaker 1: And grey street is still, you know, very involved in other projects here, local firms, they had gotten away from some projects, are they focusing on some other work right now?

Speaker 2: They're still finishing the light building, which I'm supposed to move into and nearby.

They still own quite a bit of real estate downtown, but they have some sold some of their holdings recently.

And I mentioned Broadway east, that whole project, they recently sold that land to fulcrum.

So the lone star project was definitely the biggest on their horizon that I know of.

Yeah.

Speaker 1: And you've covered some companies coming in from out of state, as well as from out of town and some of these, and they're, they're looking nationwide for potential buyers, for little parts of this, there are parts that we're going to go down to the river.

I mean, if it's not all all or nothing deal, but they had drawings, they had a whole concept of whether they're going to do.

Speaker 2: Yeah.

There was a big master plan developed for the site.

They had figured out what might work best on different parcels.

There were specific numbers that they presented to the city council, as far as the square footage of different pieces, the number of units.

And so what, what, whether those plans will happen now, I'm eager to see Speaker 1: Then the lone star district is something competing with the Pearl, because that was basically, it looked kind of like the Pearl feasible viable at this time.

Or is there a tipping point in terms of our, our demographics here at downtown?

Speaker 2: That's a good question.

As I understand, lone star was going to be a little bit humbler perhaps than the Pearl little bit of a different mix.

Speaker 1: Okay.

The lower scale.

So it wouldn't have been, or downscale may be a little bit, Speaker 2: Maybe downscaled a little bit, yeah.

Some different components, maybe more of a focus on public art.

Speaker 1: Oh, okay.

And a beer garden and the pearls pure plural stables this week.

Stable hall.

A beer garden there.

Speaker 2: Yes.

Yeah.

There, there are plans to turn that into a concert venue.

As I understand what the beer garden used to be an event venue that closed during the pandemic.

Speaker 1: All right.

Well, thanks very much.

I know you're going to be busy with all that and the next iteration of the lone star district, we'll look forward to a story on that.

Medicine has learned the express news.

Thank you very much for coming.

Speaker 2: Thanks for having Speaker 1: Me.

And thank you for joining us for this edition of on the record.

You can see the show again, or previous shows, just go to KLR ren.org and we'll see you next time.

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