Bangor Finance Committee Advances Sewer Software, Property Purchase Bond

[0:17] Speaker A (unidentified): All right, you are live. Good evening, welcome to the review scheduled finance committee meeting. [0:22] Susan Deane: It is September 21st, 2026. The time is 7:02 p.m. I am chairing tonight's finance. I am Counselor Dean on finance. With me tonight we have Council Carson, Council Balloon, Counselor Mallor, Counselor Beth will be returning in just a moment. We also have Council Chair Hawes and Council official at the table. We are joined by our student manager, Carolyn Lear. And first up, we have bids and purchases. [0:53] Speaker A (unidentified): Yes, so the first item is from the airport. [0:57] Susan Deane: They're looking for approval to award a bid [1:01] Speaker A (unidentified): for some roof work, building 100, looking to go with the low bidder. And this one just requires committee approval. Any [1:16] Susan Deane: questions, Counselor Carson? Recommendation. Second, we are joined by Counselor Beth. We are discussing the bids and purchases of our group replacement. We have a motion and a second. Staff recommendation next. [1:42] Speaker A (unidentified): Up we have sewer software replacement. This one isn't so simple to explain, so I'll proactively invite Bike Amanda Smith up to help with this one. So looking to award some software, oh and Jeff two for one, some software, and I'll allow them to take it away. Amanda. [2:06] Susan Deane: Smith, director of water quality management. I'm gonna let Jeff take it and I'll answer questions if you don't mind. [2:12] Speaker C (unidentified): So engineering and water quality departments, we've been evaluating our new pipeline assessment certification program. Currently, the legacy system is IT pipes, which has required the best amount of administrative overhead and manual data integration, and it just hasn't [2:31] Susan Deane: been working for our crews. [2:34] Speaker C (unidentified): Amanda's sewer crews, they use this to video and assess all the sewer lines in the city. We have a consent decree that we have to do a certain amount every year, you know. They have their own TV van that you'll see throughout, and you know they pop manual covers, they put a little robot in, and then they see the condition, age, and all that, and the classification of the pipe itself, and we use that review to do our small projects, [3:05] Susan Deane: repairs, and big capital plan projects. I'll just jump in and say we wanted to ensure that we have appropriate software as well in place before we bring to you our proposal for our new CCTV van. And if you recall during budget, we talked about how this is going to be spec'd out to be a much more advanced CCTV system and ultimately replace the two vans that we kind of got, so we'll be operating one, and we really need a software that can support that. [3:42] Speaker C (unidentified): So I'm actually going to bring John Diller back up here because he's the one who spearheaded this campaign name for a new system, and he can talk about the full quote that we received and what Seward AI is and why we decided to go with it. Sure. So do you want me to explain what the software does, what it's used for? Yeah. Okay. Okay. So effectively, what it's used for, when Amanda's talking about CCTV and the CCTV van, what that is, that's basically a box truck with a computer in the back, and they have a big spool of cable with a little, looks like a remote control car with a hammer on it, and they drive it through all the sewer pipes, all the stormwater, and essentially an operator is able to control it and make a note of all of the defects in the pipes. So anytime they see cracks or root balls or if there's a service coming in that's got a lot of water that's infiltrating or any other issues like that, they log them, and then that's used for QA of the entire system, so we understand what's going on, prioritizing work and that sort of thing, and our current system, like Jeff had mentioned, there's a lot of administrative overhead, it's just difficult to work with, and unfortunately the company's technical support is also, we end up helping them more than they help us often, and so we've been looking for a new piece of software to use. This recommendation came from the Greater Augusta Utility District. I don't know, is that where you had originally heard about? Okay. And we spoke with them, they're very happy with it, they've been using it for a little while now, and we talked to a couple of other Venus parties around the country who've used it as well, and it's pretty well received, and essentially what the software does is it, as the little camera is driven through the pipes, all that video is recorded, all of the observations for the defects, all those things are logged, and essentially it all just gets saved into a database, and then when the truck gets back to the depot, that information is uploaded and it becomes effectively a part of the GIS, so that we can go and click on a pipe segment on a map and understand what its condition is, view the video, and you know, use that as a part of just better understanding our sewer network. So there's a few Different software packages, there's not a lot of players in this space, but there are a few. It pipes is one of the bigger ones, but they're also kind of a legacy that they've been around for a while. They're kind of a headache to work with, so we talked to a couple of others in exploring this in addition to talking with sewer AI, and what we found was that while largely they do the same things, we found that sewer AI has the best fit and finish general overall performance. One thing that's a little bit confusing about it is that it is the name itself, a sewer AI. And it's not really AI. So one thing that all of these software packages just have in common that's going to be a very big step forward for the city is that they use machine learning to analyze the images, and that's been something that we've been doing for you know 20 30 years. And so effectively what we can do is after those videos are saved locally, we can upload them into their system and they can scan these videos and look for defects that the operators may have missed. So one of the big advantages, there's a few big advantages here, but probably the biggest is that operators are spending less time in the middle of roads doing these captures. I can just go straight in, drive through it, capture the video, they're still making remarks, they're still testing the biggest defects, but smaller or more complex ones are going to be caught by this system. And then it's not entirely automated, so part of our requirement is that we use a NASCO certified systems and software, and with this machine learning defect detection to be NASCO certified, the companies who do it, they still have another operator go back through and validate all of the defects found by the software. So it still has a pair of human eyes on it before we create it as authoritative data. And then once that's completed, it gets them back to us, and then we can use it for analyzing our pipes system for just better understanding what's going on. And then the software also has some very useful capabilities as far as risk modeling, so we're able to specify that some of our pipe segments are a lot more critical than others, you know, so they have a, they serve a very large population or maybe they're adjacent a hospital or a school or something like that, and we want to be able to Prioritize if there are issues there, or if there's a pipe that's maybe upstream of that we may not otherwise immediately realize is connected. This software allows us to do essentially risk modeling, so you know when we're budgeting or just trying to figure out what work we want to do over a year, with all of the data that's loaded into this environment, we can have a pretty good understanding of what our network's condition is right now out and better be able to kind of forecast, figure out how we want to allocate for funds for work that needs to be done. I mean, I was just going to say in that particular component, that ability to do that modeling and forecasting is one of the biggest things that sets your AI above the others. The others were really just database programs that allowed you to view videos and see lists of problems in a pipe segment. If we wanted to synthesize the results into a report or a model, we have to do it manually, legally which is what we're doing now and it's just a very time-consuming very tedious process in the city we don't use of course sewer AI but Public Works has a biolytics program that fits the camera that we such that we use when I drive over the roads it captures it from the videos that they have and we use that to assess the roadway so this is this is nothing new I know the ai can be scary but i just wanted to address that [10:01] Daniel Carson: Yes so one two questions clarifying question and then second one if it's okay but the clarifying question is you mentioned all of this data that's received there's an operator that reviews all of that 's with the company that's so that would be with okay. My second one, and this is just more generally related to security, both cyber security, but other types of security, wastewater infrastructure, sewer infrastructure is like the top of the list for people who want to attack cities, whether it be cyber or otherwise. Wise and so with a cloud-based platform right where things are we're going to be taking videos of our very precious infrastructure and that's going to be uploaded and there's right a downloading process and there's a company i'm wondering about the risks associated with a cyber attack or violent attacks on our suicide system that could be facilitated by the fact that all of this data this would be very comprehensive data to somebody who would want to use it the wrong way so what protections Does this company have in place, or that we would have in place as a city, to ensure that this very valuable data, and I can see a thousand reasons, I'm very excited about this by the way, but that this valuable data would be for us and nobody else and not to be used [11:23] Susan Deane: in a horrific way. I'll just pop in very briefly. We have what will be excluded from this is anything that has any kind of people associated with it, so our combined, anything that has automated or controllable trumps things like that is still completely separate and that belongs to our SCADA server which is not on the internet per se and not, that means that also this would strictly be gravity sewer lines you're essentially seeing [12:01] Speaker C (unidentified): in a pipe like this and it's just going from one segment to the other. At the end, I don't know, I'm not really sure how you could use that to attack us. We already have all the lines on our GIS that anyway that shows those same line segments on the ground, so it's just, it's essentially just your one circular pipe, so I don't, you know, I'm not, yeah, it's a very big [12:24] Susan Deane: concern right now. It's been more and more aggressive lately, so we've had our entire, the entire system looked at through our consultant to kind of carve out anything that will not be of any use to this. Dr. Fish? I assume this remote motorized chamber is going to significantly impact the time. You know, it will make it a lot quicker to be able to assess these pipes and where you need to focus your priorities. Do you have any idea of how much time you're going to save? [13:03] Speaker C (unidentified): So we already have the robots, we already use those now, we already camera and record it. And right now that system, this new system takes that data quicker and can tell if it's a launch room crack or where that crack is, if it's a three o'clock or eight o'clock. It just helps us collect that data faster so her crew in the field doesn't have to be out, you know, in that, in that van and a busy road in the middle of the roadway trying to get every tiny little crack from there, they're, they're seeing it's hoping that's going to save you time [13:36] Susan Deane: Okay, thank you for that. If I'm not mistaken, we have always exceeded the minimum requirements like quite a bit, even, yes, before we proposes, yes, we have, we'll just be able to do it more efficiently with less disruption to traffic. Yeah, we're still, her crew is still looking at it [13:58] Speaker C (unidentified): Who is NASCOT certified? We have staff in house that are NASCOT certified that still, they'll still be working together to help capital plan, and it doesn't take that one of [14:09] Susan Deane: the real time savers is really on the back end because it's going to help take a lot of subjectivity out when we sit down into our capital planning every year, and there's, there's often in disagreement with prioritizing where to spend that final item on money that we have every year. This is really going to help make it a much easier, more objective conversation. [14:33] Michael Beck: So this is approvals for the first year. How did that work for the additional years that you know, did this automatically renew or does it come back before this committee like a sole source approval, or how do we, if we approve this piece today, how does it come back to us in the [14:52] Speaker C (unidentified): future? Yeah, so we're not locked into a contract for one thing, and that's that is a big differentiator from what we were using previously if we were in a set five year. So that's when we'll get it's either 60 or 90 days notice before it expires where we will have the opportunity to engage with the company and kind of determine how we want to continue, whether or not we want to go with another vendor or whether or not we want to stick with them. One particular thing that we made sure of for all of the companies that we looked at closely was that we would retain ownership of the data, so even though it is in the cloud and it's processed in the cloud, as long as our contract with them is valid for the you know the one year period, we can always get a full export of the raw data back locally that we can do whatever we want. So whether or not we go with another vendor or go back to it pipes or whatever, we can do that, and then yeah, in that window we can choose if we want to stick with them or if we want to you know go with somebody else. Yeah, we have, we have a lot of freedom there, and this is something you budget appear before anyway. We [16:04] Susan Deane: have no further questions putting into motion recommendation. Second. Any questions, concerns? Just to full council? No. Nope, this will be it. This recommendation even better recommend it improve. Thank you. [Speaker C (unidentified): Yeah, good] night. Next up we have a workout agreement for 250 Huston app unit 1K. Yeah, so this one's pretty straightforward. We have a homeowner who has been under a workout [16:53] Speaker A (unidentified): Agreement with the city and making the required payments and is looking to continue under that same agreement for another year. And I'm happy to have our treasurer up to answer any questions if you have them. Any [17:13] Susan Deane: questions regarding this one, Counselor Mallor. Just a general question, what's the interest rate we're getting on it because I know it changes every year. It's not something they can get the program to 70 percent, that's for the current year. Yeah. None. Can I entertain a motion? Second. Motion we have a second. We do not have any concerns. We will go with staff recommendations for another year. It's nice to see things work. Unfortunately [18:22] Speaker A (unidentified): that is not always the case. So the next item is a recommendation to take possession of a property, 290 Pearl Street, that previously was within a workout agreement that has not been successfully maintained, and so now we are recommending that we take possession of the property. Do you have anything to add on that? [18:45] Susan Deane: I don't really. I believe the normal covers the details of what happened throughout this past year with them. How's your fish, Mr. Tenant? Was going to offer to list the property. Was there a suggested list price? It just seems odd that she had a chance to sell it and maybe we didn't get into that detail. He tried to reach out to her a few times and was only able to contact. So unfortunately we don't like to see these things happen, but since she was not responsive to any of our mailings and this is the second property, it is. Oh, it is. Okay. Any other questions, [19:46] Daniel Carson: concerns? I entertain a motion. Move that we forward to the full council the recommendation. [20:13] Susan Deane: And lastly, we're going to discuss the issuance of the bond for the purchase of 103 Main Ave. [20:25] Speaker A (unidentified): Yes, so you have quite a lengthy memo on this topic in your packet that was sort of precipitated by the public input that we've sort of already received on this item. So the underlying item is the bond order authorization for 1.4 million dollars for the purchase of 103 three Main Avenue. The history of this property is that it was some time ago part of Dow Air Force Base and then was given to the city. There's one 14,000 square foot building on the property and then an almost 5,000 square foot out Building all on just over 3.5 acres. We sold the building to PCHC for 1.5 million in 2009, and they committed to make substantial and did make substantial renovations to the building following the purchase. In the deed, the city retained a right of first refusal, and PCHC has an offer and an agreement to sell the property to Northeast Pain Management for $1.35 million. We met previously and discussed sort of the costs and benefits of exercising that right of first refusal, and you all authorized me to exercise that right of first refusal. And so the process where we are in now is authorizing an actual bond for that. Yes, if we complete that purchase, the intention would be to move the city's public health department to that location from their current almost 12,000 square feet of leased space located at 103 Texas Avenue. The annual rent for that space is currently a hundred and forty two thousand dollars and is set to escalate over the course of the next three years, so we just renewed that lease. Interestingly, on this leased property we are basically responsible for all of the maintenance and upkeep of the building except for roof repairs, the heating system, the electrical system, and maintaining utility fee beads. We're also responsible for snow removal, parking lot maintenance, repairs, sidewalks, entrances, Etc. And so we have the figures here if the amount of maintenance repair costs that we have expended on that building in the last two fiscal years, 25,000 and then 15,000 in the most recent two years, respectively. It also has some comfort challenges for our staff. It's a very old, updated building. There is some air quality issues that we've had to manage by installing scrubbers or purifiers. Fires, there's lead pipes, so we have to purchase drinking water for staff. So needless to say, there's a number of challenges with the building in addition to the fact that it's quite expensive leased space. And so when evaluating sort of the costs and benefits of exercising our right of first refusal, that was the primary driver was the opportunity to, you know, in a worst case scenario, a break even but own the building that our staff is occupying and have them an appropriate space for them to do Their work. Some other notes about the purchase. The city doesn't have, or at least to my knowledge the staff that I'm working with don't really have, any ideas or thoughts for the 4,800 square foot out building. I believe it's primarily being used for certain maintenance. It's on storage right now. I think the one thing that we have to be cognizant of for any future plans is that there is an adjacent daycare, so we certainly wouldn't want to plan to use it for anything that would be inappropriate for the neighbors using that space. About sort of the other potential costs, we're not anticipating significant fit out costs for the space, primarily because it's being used now exactly how our staff will use it should they move into it as office space. It will be slightly larger than the space they're in currently, but not large enough to contemplate really any new uses. It will really just be all of our existing programs moving over to that new space. And then the other additional costs that we may incur, or will incur, will be moving costs. The move from Panquist to City Hall was about twenty thousand dollars. It was a several day move. I mean, it's hard to judge, but my back of the envelope is that we were be looking at about half of that to move the public health staff, just by way of the fact that there's far less heavy equipment to move, for example all of the printing equipment that we had to get into our basement. And as was the case when we moved to city hall, staff basically moved everything that they could, and then all the movers did was the truly heavy stuff. Some of the public comment that we've received has been about the possibility of other buildings. And I think this has been driven by primarily the interests of the purchaser, who has plans for this new space serving patients and expanding operations. The two other than vacant land, the two city properties that we have looked at, or we really didn't look at this first one, 50 Cleveland Street, which is the former Dow Air Force Base, and the reason we didn't look at that property is because it's already slated for a council approved project, which is a central kitchen project. That being said, the central kitchen project is a full tear down because of the condition of that building, so I don't think we'd, we wouldn't really be looking at a renovation We'd be looking at a complete new build, which I wouldn't anticipate saving much or anything. The second property that has been evaluated is 120 Venture Way, which until recently was a daycare, until Panquis relocated to their brand new daycare. We did view this property several months ago to determine whether it would be feasible to move public health here, and we determined that it was not a good option. I think really because it has been fit out to be a daycare with little short toilets and sinks and countertops and big, huge classrooms, really every surface would need to be, would need to be touched to make it office space. It would be pretty substantial. You know, if we put a million dollars into it, could we get it there? Maybe, unfortunately the nature of a 30 day right of first refusal is it doesn't necessarily allow you to do that robust analysis, but I think more importantly I'm not sure who I would assign that task to plan that transition right now, given the priorities of our public health department, so I would not recommend at this point asking our engineer or public health director to undertake a substantial top-to-bottom the building renovation to make it work for them. Certainly folks are interested in the property tax impact. Right now that property is not taxable because PCHC is a non-profit, and it will remain not taxable where the city to purchase it. Were the property to sell to a for-profit entity, you might use two different measuring points to estimate the cost impact. One is the current assessed value at 1.759 million, which represents about a 30,000 a year loss and potential future property tax revenue, or if you use the sale price it would be 23,000. I think the other relevant fact is that the pub, the build out of a new public health department is a component of the parks and rec new facility build out that you all have talked about quite a bit over the last year, and the public health portion of that project is roughly four million, and so the relocating public health to a new building would eliminate that component of the project entirely with [30:05] Susan Deane: that I'm happy to answer questions. Thank you. I read this cover to cover. There's a lot of questions. I appreciate that. I'm sure the public will also appreciate it. I had one question. The document speaks to the finance director numerous times. The finance director is an interim finance director. Does that change this document at all? [30:31] Speaker A (unidentified): The bond document? Yes. No. For purposes of any legal document, our finance director is the finance director, who actually happens to be listening tonight, Jody Varney, is our acting finance director and is managing both our finance department and the airport and has come to [30:53] Susan Deane: listen and learn this evening as well. Thank you, appreciate that. 's official. I believe you're first. How old is the building at 103 Lane Avenue? Do we see any significant maintenance issues coming up within the next three or four years? Yeah, so it's at least the what, 40s [31:20] Speaker A (unidentified): It is an old building and I think I put this in the memo, I would never want to represent to you that this is a risk-free proposition. Any 1.35 million dollar real estate transaction has risk and the nature of a 30-day right of first refusal means that we can't do the level of due diligence that you would want to do for a private commercial real estate transaction of this gravity, right? So there is inherent risk. Jenny Utterman, our public health director, has been in the building and believes it to be in good condition. There is nothing that we are aware of that would be an issue, but the process doesn't contemplate us doing the level of due diligence that even I did when I bought my home. So there is inherent risk in the transaction. Yes [32:19] Susan Deane: Of course the lease that we now have relocated is that when we just signed a new lease, is that for three years [32:30] Speaker A (unidentified): It's a three-year lease but we have the ability to get out of it with 12 months notice and so what we would be doing if this, if council determines that we do want to finalize the purchase, so we'd be providing notice. A component of the underlying deal that we are accepting is to give the seller a six month no cost lease back and so for six months the city will not have access to that property. We will be closing the sale with cash on hand and then going out to the bond market at some point in the spring to pay ourselves back. And so I would not anticipate that we would start making payments on that bond, even in next fiscal year, it would be the fiscal year after when we would start making payments. So I guess to answer more directly, I don't anticipate there would be any period of overlap where we would be both paying on the lease and paying on bond. [33:45] Daniel Carson: I don't think so. I did not, I may have, I forgot, I just don't know if I'm reading this wrong, this is [33:54] Michael Beck: One of those things that feel like too good to be true, but on the one hand I'm looking at rent 142,000 and climbing up to 150,000, but then I'm only looking at the potential $30,000 in incoming property taxes, and that just feels like the savings on the rent just blows that right out of the water, makes this an incredible deal, I think, the thing that to be fair to account [34:16] Speaker A (unidentified): for is utilities, and so the two, so under currently the lessor pays for utilities currently because they're not separated, so they can't, we can't pay for our own utilities, we will be assuming utilities on this building, and it is utilities aren't cheap, right, and so I would prefer to think of this as, you know, at the worst case scenario it's just a break even, I think that's a fair way to analyze it, not analyze it as a tremendous savings, sure, worst case scenario is it's a break even, but at the end of the day we own the building, we're not wasting money leasing [35:01] Michael Beck: Yes. Yeah, I mean even a break-even, I mean we still are coming out ahead, and I think as much has been made about look at the taxes we're foregoing, and I'm not seeing that as the big issue as it had been made out to be based on this memo. [35:19] Daniel Carson: I was just going to comment that I don't see it as a, in the worst case scenario, I still don't see it as a break-even because we've owned the building, whereas now we're paying, right, we're releasing and we're paying rent into a pot of money that we never see ever again, and every year they're going to want more, oh [35:39] Susan Deane: gosh, as you know I'm an advocate of keeping Van Gogh land as much as we can, and I think it's in the great location as opposed to where our other path is now, you know, I was hoping that maybe you'd tell me they'd have an opportunity to expand there, but it sounds like at least the space is efficient enough, and it takes this part of the equation off of the rec, you know, problem we have, so that we can continue to try to, you know, cut that budget down and see what we can do now to try to find out how we can solve the problem, yeah, I feel bad that, you know, it's kind of put a pain management position, But it is a first right of refusal, and you know how I felt when I was at 500 Main Street where the slots are now. I opened up a little business called 3 Max Advantage, and I think I just signed a 10 year lease, and a year into it, I got the call to get out of my lease, and I was scurrying around to find a place. At the time, I had 20 agents and three employees, and it didn't feel very good. So I can imagine how it could feel, but the slots are there contributing a lot of money, and I bought a building, and it all worked out. So I think that this is good for the city of Bangor. I would concur that's, I think this will be great for us. May I just say one thing? I know the public is very interested in why we want to do this, and I think maybe now they understand the right of first refusal, where it's been explained. The one thing I think the public does not understand is that the city does have money to purchase this property, but by going up to bond, or actually helping public works by allowing them more grant funding, isn't that one of the big reasons? That's one of the reasons why I think it's smart to [37:34] Speaker A (unidentified): bond this rather than paying cash, because we use, as you know, public health is substantially grant funded, and a huge component of the way they pay for their building and their electricity is through including their costs in those grant funding formulas and using some of those dollars to pay for portions of those costs. So I think having this bonded will allow them to include those amounts in the grant calculation when they determine those administrative expenses. Did [38:09] Susan Deane: I see your hand up? And this actually is [38:13] Daniel Carson: related to one of the other properties in your memo that's currently finished now for roll pikes, but as just the thought is that as the state continues to roll out new programs that impact the school system, right, we're taking on three-year-olds and other things, I suspect, and also with the urgent need of child care being a question, I suspect that we'll find a use for that space probably sooner rather than later, particularly like I wouldn't want us to rush to encourage anybody to remodel that when there's such an urgent need for services for children. Do [38:57] Susan Deane: you have any other comments on this? What do you look for to see? So we need a committee [39:04] Speaker A (unidentified): recommendation to include in the council order to council. That's a curse. I would like to move [39:12] Daniel Carson: that the committee forward this recommendation for the full council or to the full council to hold the appropriate public hearing. Second. We have a motion, we have a second. Any doubt? [39:27] Susan Deane: We have commitment to move this to full council. [39:35] Speaker A (unidentified): No other than I want to pat us on the back because I think this is the earliest we've been done. It is pitch black out, but it's 7.10 o'clock. [39:48] Susan Deane: With that, I believe finance is adjourned. Good night, everyone.