[ CITY OF BAYTOWN NOTICE OF MEETING CITY COUNCIL SPECIAL MEETING FRIDAY, JUNE 28, 2024 8:00 A.M. PUBLIC SAFETY BUILDING, COMMUNITY ROOM 3200 NORTH MAIN STREET, BAYTOWN, TEXAS 77521 AGENDA CALL TO ORDER AND ANNOUNCEMENT OF QUORUM ]
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ALRIGHT, SO I CALLED THIS SPECIAL MEETING OF THE BAYTOWN CITY COUNCIL ORDER.
SO FIRST ITEM IS, UH, CITIZEN COMMENT.
SO, UH, THIS IS AN OPEN MEETING, SO IF THERE'S ANY CITIZENS THAT HAVE SHOWED UP, THEN, UH, WE'LL MOVE ON TO ITEM TWO, WHICH IS TO DISCUSS THE
[a. Discuss City Council Goals, Policy and Vision for 2025.]
CITY COUNCIL GOALS, POLICIES, AND VISION FOR 2025.HAVING A PREGNANT LADY PANIC, RIGHT? YEAH.
FOR SOME REASON, I DON'T KNOW, LIKE, I, I WANNA DO LIKE THE BARNUM AND BAILEY, LIKE LADIES AND GENTLEMEN, BOYS AND GIRLS, CHILDREN OF ALL AGES.
I HAVE NO IDEA WHY I HAVE THAT URGE TO DO THAT.
UM, ANYWAYS, MIKE, JUST TO MAKE YOU UNCOMFORTABLE THE WHOLE TIME, WE'RE GONNA HAVE THE DIRECTORS GET UP AND WALK BEHIND YOU.
THAT'S, UH, THROUGHOUT THE DAY.
ANYWAYS, GOOD MORNING, EVERYBODY.
UM, WE HAVE FOUR HOURS AHEAD OF US OF, UH, BUDGET CONVERSATIONS AND, UH, WE'LL TRY TO DO FOUR HOURS INFORMATION IN 45 MINUTES, IF AT ALL POSSIBLE.
I THINK THAT'S WHAT WAS ASKED OF ME.
MAYBE TWO HOURS, MAYBE TWO AND A HALF.
BUT WE'RE SCHEDULED TILL FOUR.
SO IF YOU HAVE A LOT OF QUESTIONS, UH, DON'T MATTER.
BUT ANYWAYS, TODAY WE'RE GONNA BE ELABORATING ON A SHIFT THAT WE'VE BEEN MAKING, UM, IN BAYTOWN FOR ALMOST TWO YEARS.
AND, UH, WE'RE GONNA GIVE YOU A HIGH LEVEL OVERVIEW OF WHAT THE, WHAT THE LEADERSHIP TEAM HAS BEEN WORKING ON, UM, SINCE REALLY LAST MARCH.
AND THEN WE'RE GONNA TAKE A DEEPER DIVE INTO THE FY 25 BUDGET.
Y'ALL ASKED THE BUZZ AS WE STARTED OUT ON THIS JOURNEY TO START GETTING INFORMATION TO Y'ALL IN A MUCH, UH, QUICKER OR MORE AHEAD OF TIME, RIGHT? LIKE, WE NEED MORE TIME TO PROCESS THIS STUFF.
WE WOULD LIKE TO SEE IT ONE OR TWO TIMES BEFORE WE HAVE TO MAKE A DECISION ON IT.
THIS IS REALLY JUST AN INFORMATION, UM, OVERVIEW OF EVERYTHING THAT'S BEEN GOING ON.
WE HAVE A NEW COUNCIL MEMBER THIS YEAR THAT WAS, THAT WAS NOT HERE, UH, THROUGH THE BUDGET PROCESS.
SARAH AND KEN, Y'ALL WERE, UH, JUMPING RIGHT INTO A LOT OF DISCUSSIONS THAT THE CITY OF BAYTOWN HASN'T EVEN HAD BEFORE AS WELL, BUT Y'ALL WERE BRAND NEW ON COUNCIL AT THE TIME WHEN IT JUMPED IN, AND IT WAS STILL NEW FOR THE MEMBERS THAT, THAT HAVE BEEN ON THE BOARD FOR A WHILE AS WELL TO HAVE THESE DIFFERENT TYPES OF BUDGET CONVERSATIONS.
SO THIS IS KIND OF GONNA BE A RECAP OF WHERE WE'VE BEEN OVER THE PAST TWO YEARS AND, UM, REALLY HAVE A LITTLE FUN WITH IT AND HAVE SOME DISCUSSIONS AS WELL.
UM, A FEW SMALL HOUSEKEEPING ITEMS THAT WE HAVE.
UH, THIS IS THE NEW PUBLIC SAFETY BUILDING.
THANK Y'ALL FOR HAVING US OVER HERE.
UM, IF YOU DO NEED TO GO TO THE RESTROOM, JOHN KENNY, I THINK THEY'RE ACROSS THE HALL, RIGHT? WALK OUT THOSE DOORS AND GET LOST.
BUT MAKE SURE YOU LET SOMEBODY KNOW YOU LEAVE, BECAUSE YOU HAVE TO HAVE A KEY CARD TO GET IN THROUGH THE DOORS SO YOU COULD BE STUCK OUTSIDE FOR A MINUTE IF YOU, IF YOU GO OUTSIDE.
UM, THANK YOU FOR EVERYBODY FOR GETTING TO SET UP.
WE DO HAVE DRINKS AND, UH, A LITTLE, A FEW SNACKS.
IF, UH, I START TO BORE YOU TO DEATH, PLEASE STAND UP.
GO GRAB A, UH, UH, A WATER
IN THE MILITARY, WE JUST ASK PEOPLE TO STAND UP AND DO JUMPING JACKS.
DON'T SPEND DESIGN SNACKS THOUGH.
UH, JUST DON'T FALL ASLEEP IF YOU DO FALL ASLEEP.
OH, AND KENNY DID BRING COFFEE.
UH, WE'RE HAVING A COFFEE HERE FOR ALL OF US THIS MORNING.
AND LOOK AT DANA'S BRINGING EXTRA ALREADY.
THAT'S ALL YOU SERVED FOR 31 YEARS, RIGHT THERE.
WHAT Y'ALL, IS THAT EASY? ALRIGHT, SO LET'S JUMP INTO THIS.
SO TODAY COUNCIL WILL RECEIVE INFORMATION REGARDING THE CITY'S CURRENT FINANCIAL REALITY AND FORM REALISTIC EXPECTATIONS FOR THE FY 25 BUDGET.
WE ALSO HOPE THAT YOU'LL UNDERSTAND THE FY 25 BUDGET PREPARATION TIMELINE AND COUNCIL'S ROLE IN CRAFTING A BALANCED BUDGET.
SO TRYING TO ENGAGE Y'ALL RIGHT AWAY.
LET'S GO BACK TO DECEMBER 22 AND JANUARY 23.
WHAT WAS DIFFERENT IN DECEMBER 22 AND JANUARY 23 FOR THE CITY?
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UM, SLEPT WELL.I THINK AT THAT POINT WE WERE, YOU WERE JUST ON BOARD.
WHAT ELSE WAS HAPPENING? MORE COFFEE.
UM, I THINK WE WERE JUST ON THE HILLS OF EXXONMOBIL.
UH, LITTLE, UH, MORNING WAKE UP EXERCISE AND I'M, I'M ACTUALLY GOING BACK BEFORE, SO I WENT TO 22.
WE DIDN'T EVEN HAVE CARDS FOR THIS, RIGHT? I DON'T HAVE A FOR THAT ONE.
SO, UH, THIS WAS A SHIFT FOR THE CITY OF BAYTOWN.
IT WAS A SHIFT IN A LOT OF THINGS.
WE'RE GONNA ACTUALLY KICK OFF IN MARCH UP HERE, BUT I DO WANNA HIGHLIGHT THAT IN DECEMBER AND JANUARY, THINGS STARTED TO CHANGE, UH, QUITE A BIT, RIGHT? THE DIRECTORS GOT TOGETHER, UM, IN DECEMBER, STARTED LOOKING AT WHAT EXPECTATIONS WERE GONNA BE, LIKE, WHAT WE WERE, WHAT WE WERE DOING, WHAT WE WERE DOING, TOO MUCH OF WHAT WE WEREN'T DOING RIGHT, WHAT WE WERE DOING WELL.
AND WE STARTED TO SAY LIKE, HEY, WE NEEDED TO FOCUS ON, OKAY, YOU CAN JUST YELL AT ME, MAN.
UM, THAT WE NEEDED TO FOCUS ON OUR CORE SERVICES AND WE NEEDED TO FOCUS ON THINGS THAT, THAT ARE, WE'RE TRYING TO DO EVERYTHING AND WHAT CAN WE LIKE, PAIR THAT DOWN AND REALLY DO SOME THINGS REALLY, REALLY WELL.
AND THEN IN MARCH OR APRIL OF, UH, OF 23, WE HAD A PRESENTATION WITH THE CITY COUNCIL AND IT TALKED ABOUT STRATEGIC PRIORITIES, CORE SERVICES, HOW THINGS WEREN'T ALIGNING.
WE TALKED ABOUT HOW WE SPEND A LOT OF TIME TALKING ABOUT STRATEGIC PRIORITIES, RIGHT? AND OUR, IN OUR RETREAT IN JANUARY OF 23, THAT'S REALLY OUTSIDE OF OUR TEAM BUILDING PIECES.
IF Y'ALL GO BACK TO APRIL OF 23, HOW MUCH MONEY DO WE ACTUALLY SPEND ON OUR STRATEGIC PRIORITIES? LIKE, UH, ON A PERCENTAGE WISE, IF WE SAY WE HAVE A HUNDRED MILLION DOLLAR BUDGET, WHAT PERCENTAGE OF THAT A HUNDRED MILLION BUDGET GOES TOWARDS STRATEGIC PRIORITIES? IF, WELL, I GUESS PREVIOUS EXAMPLE, 20%.
'CAUSE IT'S ABOUT 80% IS PERSONNEL.
YET WE SPEND ALL OF OUR TIME TALKING ABOUT STRATEGIC PRIORITIES.
AND THE POINT OF THAT CONVERSATION IN APRIL AND MAY WAS REALLY IDENTIFYING THAT OUT OF ALL THE MONEY THAT THIS ORGANIZATION SPENDS, IT'S MOSTLY ON CORE SERVICES.
SO WHY AREN'T WE, WHY AREN'T WE SPENDING MORE TIME CONVERSING ABOUT WHAT OUR CORE SERVICES ARE? HOW COME WE'RE NOT MEASURING FOR SUCCESS ON OUR CORE SERVICES? AND THAT WAS LIKE THE REAL SHIFT WITH THE CITY COUNCIL WHEN WE WERE TALKING ABOUT HOW WE WERE, WERE LOOKING AT THESE THINGS.
AND THAT WAS ONE OF THE FIRST POLICY DECISIONS THAT WE MADE IN THIS SHIFT IN JULY OF 23.
OH, IN MAY, I DON'T REMEMBER WHAT MAY WAS.
HUH? WE DID THE HOME EXEMPTION IN MAY.
OH, WE DID THE HOME EXEMPTION IN MAY.
SO WE DID A HOME EXEMPTION IN MAY.
HOW DOES THAT DIRECTLY IMPACT THE BUDGET? WELL, LESS REVENUE.
LESS TAX ABORTION OF, OF LESS REVENUE.
AND THEN IN JULY, WE TALKED ABOUT WHAT THE REVENUE AND EXPENSES LOOK LIKE.
WHEN WE LOOKED AT AN OVERALL GRAPH, DID THAT SAY, DO NOT JUDGE MY, I DIDN'T, I DIDN'T MAKE A, A VERY LARGE, REALISTIC VERSION OF IT.
BUT GIVING YOUR B THE REVENUE
I'VE SEEN THAT GRAPH SOMEWHERE,
SO I HAVE A QUESTION FOR Y'ALL.
FOR SOME OF THE MEMBERS THAT HAVE BEEN ON COUNCIL FOR A WHILE, WHAT, WHAT DID THIS SAY TO YOU WHEN WE SAW THIS FOR THE FIRST TIME? IT WAS AN AHA.
IT WAS WHAT? IT WAS AN AHA FOR ME.
BECAUSE WE WERE WHOLE DIFFERENT THAN, WE WERE MORE OF MORE REVENUE WAS INCREASING.
AND WE ARE MEETING, WE'RE NOT EVEN AT A PLATEAU.
WE'RE LIKE, OKAY, WELL, I MEAN, I DON'T THINK IT WAS AHA.
I THINK WHAT I RECALL WAS WHEN YOU SHOWED A GRAPH SIMILAR TO THIS, BUT YOU SAID, THIS IS EXAGGERATED, BUT IT'S TO PROVE THE POINT.
SO YOU GET THE AHA TO SAY, WE DO NEED TO MAKE
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SOME ADJUSTMENTS TODAY TO HAVE A SUSTAINABLE FINANCIAL FUTURE.THAT'S WHAT WAS THE MESSAGE FROM WHAT I REMEMBER, RIGHT? CORRECT.
AND SO, I MEAN, IT WAS EXAGGERATED.
AND SO I THINK I WILL SAY THIS.
SO SOME COULD TAKE THIS AND PORTRAY IT AS SOMETHING A LOT WORSE OF A SITUATION THAN IT REALLY IS.
RIGHT? BUT THE IDEA IS, OKAY, SOMETHING NEEDS TO CHANGE.
AND AS YOU EXPRESS, WHAT ARE SOME THINGS THAT WE NEED TO LOOK AT TO MAKE SOME ADJUSTMENTS TODAY? CORRECT.
I DIDN'T LIKE IT WHEN I SAW IT.
WHAT? BUT IT WAS FROM A POINT WHEN HE, HE DID HAVE, YOU KNOW, THAT WAS ONE THING THAT'S OMITTED IN SOME PORTRAYALS OF THIS GRAPH IS IT WAS MEANT TO GO AND SAY, WE, THERE IS SOMETHING THAT WE NEED TO, THERE'S ACTIONS AND POLICIES AND DECISIONS WE NEED TO MAKE TODAY SO THAT THERE'S A SUSTAINABLE FINANCIAL FUTURE, OBVIOUSLY.
HOW DID YOU FEEL OUTSIDE OF I DIDN'T LIKE IT.
'CAUSE AT THE TIME I WAS A NEWBIE AND I WAS LIKE, DANG IT, I'M COMING IN WHEN DAD'S PUTTING A BUDGET ON THE HOUSE,
AND I DIDN'T, I DIDN'T LIKE IT.
I DIDN'T, I, I WAS FRUSTRATED, UM, HAVING TO COME IN WHEN, WHEN THERE WERE THESE AHA MOMENTS GOING ON.
WELL, MY FIRST THOUGHT WAS, UH, HOW DO, HOW DO WE AVOID? THAT WAS MY FIRST THOUGHT.
HOW DO WE, HOW DO WE BALANCE THAT TO WHERE THOSE DON'T CROSS? YEAH.
WERE YOU TWO COMING IN NEW AT THE TIME? WERE THERE ANY PRECONCEIVED NOTIONS IN THE PUBLIC, UM, THAT HAD BEEN RELAYED TO Y'ALL FROM YOUR CONSTITUENTS COMING IN? WERE WERE THERE ANYTHING WITH MONEY-WISE THAT, THAT WAS ON THE TABLE FOR Y'ALL THAT Y'ALL WERE CONSIDERING? OR, OR WAS IT TALKED ABOUT DURING YOUR FIRST FEW MONTHS WITH, WITH CITIZENS? FOR ME, THE PRECONCEIVED NOTIONS, UH, WEREN'T THAT WE WERE COMING TO THIS, UM, HEAD WHERE THINGS WERE, WHERE OUR REVENUE MAY NOT BE THERE FOR, FOR DIFFERENT PROJECTS AND THINGS LIKE THAT.
THE PRECONCEIVED NOTION WAS THAT THE CITY WAS JUST CHOOSING TO SPEND LARGER AMOUNTS OF MONEY ON THINGS THAT MAYBE CITIZENS DID OR DIDN'T WANT.
UM, THERE WAS A LOT OF CONCERN THAT WE WEREN'T PUTTING ENOUGH INTO INFRASTRUCTURE AT, AT THE TIME WHEN IT FIRST CAME IN.
UM, BUT I WAS UNAWARE COMPLETELY THAT, UM, WE MIGHT NEED TO CUT BACK ALTOGETHER.
MR. FRANCO, HIDING BACK THERE, ANY THOUGHTS? I MEAN, THIS IS NOT THE FIRST TIME YOU'VE SEEN THIS, BUT IT'S STILL FAIRLY NEW TO YOU AT THIS POINT.
YEAH, IT WASN'T, YOU KNOW, IF YOU GO BACK TO THAT'S A LOT OF WHAT MY CONSTITUENTS, A LOT OF WHAT I DO HERE AT THAT TIME, OF COURSE, DURING CAMPAIGN, BUT A LOT OF IT WAS THAT THERE'S BUDGET CRISIS AND THAT WE NEED TO GET A LOT OF ONLINE AND PEOPLE DIDN'T WANT TO SEE WHAT WAS HAPPENING IN OTHER CITIES WHERE, YOU KNOW, OUR COSTS WERE NOT GONNA BE COVERED.
SO, UH, THAT'S KIND OF A LOT OF WHAT THE, THE HEARTBEAT IS OF, OF THE, OF THE CITY RIGHT NOW.
SO, UH, IF Y'ALL CAME IN AT A DIFFERENT TIME THAN WHEN I CAME IN, SO Y'ALL HAVE TO SEE THIS, BUT I MEAN, IT, IT'S, IT IS NOT JUST HERE THAT, THAT, THAT SEE THAT IT'S HAPPENING.
THERE'S A LOT OF CITIES THAT ARE COMING TO THIS REALIZATION TOO.
UH, I APPRECIATE THE PARTICIPATION.
IN JULY, UM, IN JULY, AUGUST WE STARTED TALKING ABOUT A FORMULA.
I DON'T KNOW IF Y'ALL THOUGHT THIS WAS FUN.
SO THE OVERALL PIECE, AND WE'LL BUILD IT OUT HERE IN A MINUTE, THE OVERALL PIECE WITH THE FORMULA WAS THAT, YOU KNOW, THIS IN ITS SIMPLEST FORM, THE BUDGET IS JUST A MATH PROBLEM.
AND WHEN YOU LOOK AT WHERE THINGS START, WE ALWAYS START WITH THE BEGINNING FUND BALANCE FOR THE YEAR.
RIGHT? AND THERE'S POLICY DECISIONS THAT COUNCIL MAKES WHEN IT COMES TO THE FUND BALANCES AND THE SHIFT THAT WAS HAPPENING ALREADY WITH THE FUND BALANCE FOR THE PREVIOUS TWO YEARS.
DO Y'ALL REMEMBER WHAT HAPPENED ON THE PREVIOUS TWO YEARS WITH THE FUND BALANCE? DID THE CITY USE THE FUND BALANCE FOR ANYTHING? UM, WHAT DID WE DO? YOU ARE SHAKING YOUR HEAD, MR. YEAH.
WE TRANSFERRED A LARGE AMOUNT OF IT FOR CAPITAL PROJECTS, RIGHT? WE DID CASH FUND TO CAPITAL PROJECTS.
THE POLICY PIECE FOR THE CITY COUNCIL AT THAT POINT WAS THAT WE WANT TO STOP USING SO MUCH DEBT.
WE THINK WE'RE, WE HAVE AN EXCESS AMOUNT OF DEBT AND WE NEED TO START USING OUR FUND BALANCE TO OFFSET THE AMOUNT OF MONEY THAT WE'RE GONNA BORROW AND USE THE CASH INSTEAD.
RIGHT? I, I'M SUMMARIZING THAT, UH, VERY SHORTLY, BUT OVER TWO YEARS, WE DREW DOWN THE FUND BALANCE $31 MILLION.
IT, IT TOOK IT DOWN TO ROUGHLY 60 DAYS OVER THOSE TWO YEARS.
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AND THAT WAS A POLICY DECISION, NOT RIGHT OR WRONG.THAT WAS THE, UH, YOU AS A COUNSEL MAKE THE BEST DECISIONS THAT WITH THE INFORMATION THAT'S IN FRONT OF YOU, AND YOU'RE ALSO WORKING TOWARDS THE GOAL OF USING LESS DEBT.
SO WITH EVERY DECISION THAT WE ALSO MAKE, IT COMES WITH PLUSES AND MINUSES, AND WE ALL KNOW THAT AS WELL.
THE NEXT PIECE OF THAT FORMULA IS THE REVENUE.
AND THIS IS THIS PORTION OF THE, THE FORMULA IS GEARED AROUND THE PROPERTY TAX.
UM, WELL, ACTUALLY, LET ME ASK Y'ALL.
I DON'T WANT TO ENGAGE YOU HERE.
SO WE HAVE PROPERTY TAX, UM, WE HAVE IDAS, WE HAVE SALES TAX, UM, WE HAVE FEES, FINES, AND THAT'S ON THE NEXT ONE.
I THINK THAT'S ON THE REVENUE.
LOOK, Y'ALL ARE JUMPING AHEAD, 'EM, GLAD Y'ALL ARE PAYING ATTENTION.
AND, UM, THIS IS THE, ALL THE FINES AND FOUR PICTURES.
AND THIS IS JUST THE SECOND PIECE OF WHAT Y'ALL DECISIONS THAT Y'ALL MAKE BECAUSE ARE THERE POLICY DECISIONS WITH BOTH OF THESE? YES.
WHAT POLICY DECISION DO YOU MAKE WITH THE PROPERTY? THE RIGHT TAX, RIGHT? RIGHT.
WE ALSO MAKE PROPERTIES, WE ALSO MAKE POLICY DECISIONS WITH ECONOMIC DEVELOPMENT INCENTIVES, RIGHT? WITH OUR IDAS MM-HMM
SO THAT IS SOMETHING THAT WE WORK WITH.
UM, THE SALES TAX, THAT'S A POLICY DECISION THAT, UH, WE MAKE, UH, TO HAVE THE, UM, WORKING WITH MBDS, WORKING WITH, UH, JUST THE 1 CENT THAT WE HAVE ON THE OVERALL EIGHT AND A HALF OR EIGHT AND A QUARTER.
SO THERE'S POLICY DECISIONS IN ALL OF THESE PIECES THAT WE HAVE.
WE SET THE RATES FOR THE FINES AND THE FEESS, UM, MUCH SMALLER SCALE.
AND THEN THE LAST PIECE OF THE REVENUE FORMULA IS OUR TRANSFER IN FROM OTHER FUNDS.
AND SO WITH THE TRANSFER INS THAT WE HAVE, UM, THIS IS, WE TRANSFER MONEY IN THAT IS ADMINISTRATIVE FROM OTHER FUNDS LIKE, UH, SAY MDD OR SAY THE TURS OR, UM, WHATEVER THE CASE MAY BE, WATER, SEWER.
WE TRANSFER MONEY FROM THOSE FUNDS INTO THE GENERAL FUND BECAUSE THE STAFF DOES THE ADMINISTRATIVE COST OR DOES THE ADMINISTRATIVE WORK.
AND THAT'S TO COVER THE COST FOR THAT PIECE.
SO THE ISSUE WITH THAT IS THAT IT'S SOMETIMES USED AS A GAP FILLER AS WELL, RIGHT? MM-HMM
SO WHEN WE GET IT, WHEN WE'RE ABOUT TO JUMP INTO THE EXPENSES, THIS ONE IS OFTENTIMES THE GAP FILLER TO HELP BALANCE THIS EQUATION BECAUSE THESE TWO ARE RELATIVELY SET AFTER THE POLICIES DECISIONS ARE MADE.
SO THE NEXT PIECE THAT WE HAVE ON HERE IS OUR EXPENSE.
OUR EXPENSE IS, THE FIRST ONE IS OPERATION AND ONGOING EXPENSES THAT WE HAVE.
OKAY? THIS IS MAINLY DRIVEN, UH, COUNCIL'S POLICY PIECE THAT YOU PLAY IN.
THIS IS ACTUALLY SETTING UP THE DEPARTMENTS AND SETTING UP EXPECTATIONS THAT Y'ALL HAVE FOR SERVICES THAT, UH, THAT WE DELIVER.
BY AND LARGE THOUGH, Y'ALL DON'T HAVE A LOT OF INSIGHT INTO THAT OUTSIDE OF THE VERY HIGH LEVEL OF SETTING THE BUDGET TO MAKE SURE THAT THE SERVICE PIECES ARE THERE.
AND THEN ONE THING THAT WE'RE WORKING ON IS SETTING UP THE METRICS TO, UM, SHOW THAT THE SUCCESS OF WHAT YOUR EXPECTATIONS ARE WITH THOSE DEPARTMENTS.
HOWEVER, THE DIRECTOR SPEND ALL THEIR TIME UNDERSTANDING WHAT THIS IS AND, UM, CONTRIBUTING TO THE BEST PRACTICES OR CONTROLLING WHAT THE EXPENSES ARE.
THE NEXT EXPENSE PIECE THAT YOU HAVE IS THE TRANSFER.
THE NON-RECURRING TRANSFERS, UH, ARE TRANSFERS OUT THAT SUPPORT OTHER FUNDS AS WELL.
YES, WE TRANSFER MONEY AND FROM OTHER FUNDS, BUT WE ALSO TRANSFER MONEY OUT TO OTHER FUNDS.
UM, THE NON-RECURRING IS A LITTLE BIT OF A MISNOMER THOUGH.
WHY IS IT A MISNOMER? BECAUSE IT'S RECURRING.
BECAUSE IT'S RECURRING AND IT'S STUFF THAT WE HAVE TO DO TO SUPPORT OPERATIONS.
HOWEVER, THAT VARIES FROM YEAR, YEAR TO YEAR.
WE CAN JUST STOP IT IF WE WANT TO.
UM, BUT WHEN YOU STOP IT, YOU REALLY ARE BRINGING A LOT OF OPERATIONS TO A HALT AT THAT POINT.
SO THERE ARE POLICY PIECES THAT WE HAVE TO UNDERSTAND WITH WHAT THAT IS, AND THAT VARIES ROUGHLY FOUR TO 7 MILLION EVERY SINGLE YEAR.
SO AT THE END OF THAT, ALL OF THAT EQUALS
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A ENDING FUND BALANCE.AND A POLICY PIECE HERE, AND WE'LL TALK A LITTLE BIT ABOUT IT IN A MINUTE, IS, HEY, WE KNOW WHERE WE'RE BEGINNING AND COUNCIL HAS SET AN EXPECTATION ON WHERE WE NEED TO END.
SO ALL OF US HAVE TO WORK TOGETHER TO BUILD THE POLICY PIECES THAT WORK INTO REVENUE COLLECTION AND EXPENSES, RIGHT? IT'S ALL COMING BACK.
DO YOU LIKE IT AS MUCH, MUCH AS MR. POWELL DOES? OH YEAH.
ALRIGHT, SO IN AUGUST, WE ALSO DO THE, OKAY, SO, SO BACK TO THE STORY OR THE TIMELINE.
WE STARTED SETTING OUR TAX RATE IN AUGUST, RIGHT? BECAUSE WE DON'T KNOW WHAT OUR VALUES ARE UNTIL LATE JULY.
COUNCIL STARTS LOOKING AT THE, UH, THE TAX RATE.
IT'S ONE MORE POLICY DECISION THAT YOU'RE MAKING.
UH, WE'RE CURRENTLY WORKING WITH POLICY, POLICY DECISION THAT THE COUNCIL HAS GIVEN US, AND WE'LL, WE WILL TALK ABOUT THAT, UH, SHORTLY AS WELL.
THE NEXT THING THAT WE DID IS SEPTEMBER, WE ADOPTED THE BUDGET.
THIS IS THE BIGGEST POLICY DECISION THAT Y'ALL MAKE EVERY SINGLE YEAR.
IN THIS BUDGET ADOPTION, THERE WAS SOMETHING DIFFERENT.
THIS BUDGET WAS DIFFERENT FOR BAYTOWN.
THERE WERE KNOWN SHORTFALLS IN THIS BUDGET.
WE KNEW THAT, UM, AQUATICS WAS NOT FULLY FUNDED.
WE KNEW THAT SANITATION WAS NOT FULLY FUNDED.
WE KNEW THAT THE, UH, GARAGE AND WAREHOUSE OPERATIONS WERE NOT FULLY FUNDED.
AND THE INTENT AT THAT TIME WAS TO WORK WITH EVERYBODY, UH, TO ENSURE THAT WE DON'T HAVE THE FULL, UH, FUNDING GAP THAT WAS IN THE, THAT WERE, THAT WERE PRESENT IN THOSE FUNDS AT THAT TIME.
AND, UH, THAT WAS THE RISK THAT WE TOOK.
OKAY? IN ADDITION TO THAT, IN ADDITION TO THAT, WE ALSO HAD A RARITY FOR BETO.
WE DID NOT HAVE ANY PERSONNEL ADDRESSED, LIKE ZERO PERSONNEL.
HOW MANY PERSONNEL DID WE ADD THE YEAR BEFORE OR TWO YEARS BEFORE? COME ON, MIKE, I KNOW YOU NEED THIS.
41 OR 43, BECAUSE IT WAS A LOT OF PEOPLE WE ADDED, IT WAS THE BIGGER AND 10 OVER THE PAST FEW YEARS, OR TO SOME, TO SOME EXTENT LIKE THAT.
SO ADDING NO PEOPLE AT, AT THE, AT THE ONSET OF THE BUDGET WAS NEW.
DO YOU KNOW WHAT ELSE WAS NEW? NOT PUTTING ANY MONEY INTO THE CIP THE PREVIOUS YEAR.
WE TRANSFERRED 17 OR $18 MILLION INTO THE, THE CFP TO CASH ON THE CFP TO LOWER THE DEBT.
THIS, WHEN WE ADOPTED FY 24, I THINK IT WAS 250,000 OR SOMETHING LIKE THAT.
I MEAN, IT WAS, IT WAS NOTHING.
UM, IN ADDITION TO THAT, WE DIDN'T REALLY HAVE SUPPLEMENTALS AND THE SUPPLEMENTALS ARE REPLACING VEHICLES, UH, GETTING NEW TRACTORS, GETTING, UH, STUFF SO THAT THE DIRECTORS CAN HAVE THEIR TEAMS DO THE JOBS THROUGHOUT THE CITY.
THAT WAS NEW, RIGHT? UM, IN THE END, WHEN THE BUDGET WAS ADOPTED, WE DID ADD A FEW PERSONNEL, UH, THROUGH NEGOTIATIONS WITH POLICE AND FIRE.
AND THOSE INDIVIDUALS WERE ADDED FOR KNOWN OPERATION GAPS THAT WE HAVE.
UM, AND THAT IS WHAT IT IS AT THE TIME, AND THAT'S FINE.
UH, IN OCTOBER AND DECEMBER, WE EXTENDED THE TURS TURS ONE, AND THEN WE CREATED TURS TWO.
THE, THE CREATION OF THESE, OR THE CREATION AND EXPANSION OF THESE TWO ENTITIES WAS NEEDED BECAUSE, UM, THEY WERE GIVING THE REVENUE NECESSARY TO EXPAND, UH, DEVELOPMENT IN STRATEGIC AREAS THAT COUNCIL DEFINED AS, UH, WE NEED TO FOCUS ON THESE AREAS.
AS I MENTIONED EARLIER, EVERY DECISION THAT WE MAKE HAS REPERCUSSIONS.
THE REPERCUSSIONS OF CREATING DETERS TWO IS IT TAKES $387 MILLION OUT OF THE GENERAL FUND.
AND TAKING TAKES HOW MUCH? $387 MILLION OUT OF THE GENERAL FUND.
SO, UH, YOU KNOW, THAT ROUGHLY EQUATES TO $2 MILLION IN REVENUE.
IT'S, UH, PROBABLY 1.7 MILLION.
[00:25:02]
AND THAT'S FINE.AGAIN, WE ARE MAKING POLICY DECISIONS WITH THE INFORMATION THAT'S IN FRONT OF US IN JANUARY OF 24.
UM, YOU KNOW, WE'RE A QUARTER INTO FY 24 AT THIS POINT, AND WE SPENT A LOT OF TIME WORKING ON DIRECTION AND PRIORITIES AT THIS, AT THE COUNCIL RETREAT.
OKAY? AND I CAN'T READ MY NOTES.
DURING THIS TIME WE DID MAKE POLICY DECISIONS, UH, BUT WE REALLY FOCUSED ON WE, WHAT NEEDS TO BE NEXT, WHAT NEEDS TO BE WITH OUR CORE SERVICES, WHAT NEEDS TO, HOW DO WE WANT TO ADDRESS THE ENTERPRISE FUNDS? AND A LOT OF THAT WAS LIKE, HEY, YOU KNOW, WE, WE CAME BACK AND TALKED ABOUT THE, THE GAPS THAT WE'RE IN, THAT WE KNEW ABOUT THE ENTERPRISE FUNDS.
WE SAID, HEY, WE, WE KNOW Y'ALL ARE WORKING TOWARDS THAT, AND WE DON'T WANT TO CHANGE OUR SERVICE DELIVERY WITH THOSE ENTERPRISE FUNDS.
AGAIN, THAT IS FINE BECAUSE WHAT WE WERE TRYING TO DO IS LIKE, WE NEED TO PROVIDE THE AMENITIES AND THE ENTERTAINMENT TO OUR RESIDENTS, SOMETHING THAT THEY'VE BEEN EXPECTING.
HOW ELSE CAN WE CHANGE OUR TRAJECTORY WITH OTHER PIECES OF THE BUSINESS SO THAT WE CAN STILL SUPPORT, UH, THOSE DIFFERENT ENTERPRISE FUNDS? AND SO THAT WAS A BIG CONVERSATION AND A BIG, UM, UH, ASK TO, LIKE, HOW CAN WE REDO A LOT OF THESE THINGS? ON TOP OF THAT, WE LISTED SOME PRIORITIES THAT THE COUNCIL WANTED TO FOCUS ON TO BUILD INTO THE FY 25 BUDGET AND OR STRATEGIC DIRECTIVES.
AND THEN, SO IN FEBRUARY OF 2024, THE, THE DIRECTORS HIT THE GROUND RUNNING.
THEY TOOK YOUR, YOUR FEEDBACK FROM THE, UH, FROM THE MEETING.
THEY CREATED 55 PROJECTS THAT ALIGN WITH YOUR STRATEGIC DIRECTORS.
IT WAS LIKE THEY ALL JUMPED INTO THEIR MASTER PLANS.
THEY LOOKED AT, HEY, WE NEED TO DO THIS TO ACCOMPLISH THIS.
THIS ALIGNS WITH WHAT WAS ALREADY BEEN IN PLACE FOR YEARS WITH THE CITY OF BAYTOWN.
LET'S GET THESE READY, UM, TO ADOPT AN FY 25 BUDGET AND LET COUNCIL, I THINK IF Y'ALL REMEMBER, WE HAD A, UH, WE HAD A FOLLOW UP, UH, MEETING OR FOLLOW UP RETREAT SCHEDULED, AND THEN IT WAS CANCELED, RIGHT? IT WAS CANCELED BECAUSE IN MARCH, UH, WE RECEIVED PRELIMINARY NUMBERS IN F UH, FOR FY 25.
AND, UH, WE AGAIN HAD TO SHIFT.
WE REALIZED THERE WAS NO MONEY TO DO EXTRA STRATEGIC PRIORITIES AT THAT POINT IN TIME.
SO ALL 55 PROJECTS THAT WERE THERE, THAT WERE, THAT WERE BEING CONSIDERED, WE DIDN'T FEEL IT WAS WORTH WASTING ANYBODY'S TIME TO GO THROUGH THAT, DO ANOTHER EXERCISE LIKE THIS, IDENTIFY WHAT WE WANT TO FOCUS ON WHEN THERE WASN'T REALLY ANY MONEY TO ACTUALLY GO DO NEW PRIORITY PIECES.
SO AT THE SAME TIME, THEY STARTED WORKING ON THEIR BUDGET, THEY WERE GIVEN THE DIRECTIVE TO CREATE A FLAT OR REDUCED BUDGET FOR FY 25.
WHAT DOES A FLAT BUDGET MEAN TO Y'ALL? IT'S A CUT.
I MEAN, WHY DO YOU SAY THAT? BECAUSE EVERYTHING COSTS MORE THAN IT DID LAST YEAR.
SO TO KEEP YOUR BUDGET FLAT, YOU'RE, YOU'RE DOING LESS.
I THINK THEY ALL AGREE TO, IS THAT TYPICAL FOR BAYTOWN? NO, NO, NOT TYPICAL THAT, OKAY.
NOT IN THE RECENT YEARS, RIGHT? YEAH, NOT IN RECENT, RECENT YEARS.
SOME OF THEM HAVE BEEN AROUND LONG ENOUGH THAT, THAT, THAT WAS ACTUALLY THE CASE ALMOST EVERY YEAR.
BEEN SOMETHING LIKE OH 8, 0 9, DEFINITELY.
SO THE, UM, THE, UH, DIRECTORS WORKING ON A FLAT BUDGET WERE ALSO ASKED TO PRESENT OR TO BUILD A 5% CONTINGENCY PLAN.
UM, THAT IF WE HA IF THINGS GOT BAD, WHAT WILL WE START LOOKING AT? WHERE WOULD WE START FIRST? AND, UM, IT WAS NEW.
I DON'T KNOW HOW IT WAS RECEIVED.
I MEAN, I HEARD THE GRUMBLINGS, BUT I CAN'T SAY THAT EVERYBODY WAS ECSTATIC TO GO DO THAT.
AND, UH, BUT THE, THE FOCUS FOR ALL OF US IS WE WERE TRYING TO FIND, UM, TRYING
[00:30:01]
TO FIND DISCRETIONARY FUNDS.WE WERE TRYING TO FIND, UH, PROGRAMS THAT WERE UNDERUTILIZED THAT MAYBE DIDN'T HAVE A GOOD ROI, UH, THE, THAT TYPICALLY CAME IN UNDER BUDGET.
SO EACH YEAR THE BUDGET POSSIBLY SAVES OR PRACTICALLY SAVES AROUND THREE TO $5 MILLION EVERY SINGLE YEAR, UH, IN OUR SERVICES, MAINTENANCE AND SUPPLIES.
AND, YOU KNOW, THAT WAS A GOOD STARTING POINT FOR US.
SO THE OTHER PIECE OF THAT IS, IF YOU REMEMBER IN FY 24, WE SAID THAT, THAT WHEN WE ADOPTED THAT BUDGET, THAT WE DIDN'T HAVE PERSONNEL HAD VERY LITTLE CASH.
WE WERE SEEING ALREADY THAT FY 25 WAS GONNA BE VERY, VERY SIMILAR.
AND SO FOR US TO HAVE TWO YEARS IN A ROW OF NO GROWTH, NO MONEY FOR CIP, NO NEW PERSONNEL IS STARTING TO, OKAY, TWO YEARS.
ONE THING IS ONE YEAR IS LIKE, OKAY, TWO YEARS.
I'M LIKE, ALRIGHT, THINGS LOOK A LITTLE BIT DIFFERENT.
WE NEED TO REALLY START LOOKING AT HOW THINGS ARE.
AND SO TODAY, OR IN APRIL, I'M NOT REMEMBERING APRIL, WE DID OUR, OH, YES, THE BIG ONE IN APRIL, WE HAD OUR AUDIT.
AND OUR AUDIT HIGHLIGHTED QUITE A FEW THINGS.
IT, FOR THE FIRST TIME THE AUDIT SHOWED THE FY 23 AUDIT SHOWED THAT WE WERE OVER BUDGET.
I THINK IT WAS LIKE A HUNDRED THOUSAND DOLLARS, RIGHT? AND I, I DON'T, I'M NOT DISMISSING THAT, RIGHT? ANYBODY WATCHING, I'M NOT DISMISSING THAT.
AND, UM, IT WAS NOT DUE TO OVERSPENDING, RIGHT? IT WAS DUE TO, UH, PERSONNEL.
SO WE CAME IN UNDER, AS I MENTIONED, WHEN WE WERE LOOKING AT THE DISCRETIONARY FUNDS, WE TYPICALLY COME IN THREE TO 5 MILLION UNDER, AND WE CAME IN 5 MILLION UNDER IN OUR SUPPLIES, MAINTENANCES AND SERVICES.
SO BASICALLY THE OPERATIONAL EXPENSES THAT WE HAVE THROUGHOUT THE CITY CAME IN $5 MILLION UNDER, WE CAME IN ROUGHLY FIVE POINT SOMETHING MILLION OVER IN PERSONNEL COSTS.
A LOT OF THAT'S ATTRIBUTED TO OVERTIME.
AND, UH, IT'S ALSO ATTRIBUTED TO NOT HAVING A GOOD PROCESS IN PLACE TO BUDGET FOR PERSONNEL.
SO WHEN WE BUDGETED THE FY 24 BUDGET, WE ADJUSTED FOR THAT IMMEDIATELY.
SO IF YOU LOOK AT, IF YOU COMPARE THE YEARS, YOU WILL SEE THAT IT GOES FROM LIKE 80 SOMETHING MILLION, UH, 86 MILLION, I THINK, TO 94 MILLION, 95 MILLION, LIKE A MASSIVE JUMP.
AND THEY'RE LIKE, OKAY, WE DIDN'T ADD ANY PEOPLE REALLY.
HOW DID IT JUMP UP, YOU KNOW, SIX TO $7 MILLION? WELL, IT JUST WASN'T ACCOUNTED FOR PROPERLY, UM, IN THE PREVIOUS YEARS.
AND SO WE MADE, WE INTENTIONALLY MADE THAT ADJUSTMENT SO THAT WE KNOW WE'RE NOT GONNA HAVE THE OVER BUDGET PIECE COME IN, UM, FOR THE FY 24 BUDGET AND BEYOND.
IN ADDITION TO THAT, UH, WHAT'S THE NEXT ONE? WE DID OUR DEBT RATING.
OUR DEBT RATING IS A STRESSFUL TIME.
UH, I MEAN, I KNOW COUNCIL TALKS ABOUT IT ON THE D HEY, REDUCE IT.
IT'S ALREADY STRESSFUL IN ENOUGH GOING THROUGH THAT PROCESS.
BUT FOR THE FINANCE DEPARTMENT AND ADMINISTRATION, WHEN YOU'RE GOING THROUGH THE DEBT RATING, UM, YOU'RE, YOU'RE GETTING THE SCREWS TAKEN TO YOU, RIGHT? YOU'RE GOING THROUGH BASICALLY AN INVESTIGATION IN THE INTERVIEW ON YOUR CITY'S FINANCES.
HEY, CAME OUT, WE HAD SOME THINGS TO GLOW AND GROW, RIGHT? WE, WE HIGHLIGHTED SOME THINGS THAT WERE DOING VERY WELL, AND WE HIGHLIGHTED SOME AREAS THAT WE NEEDED TO ADJUST ON HOW WE'RE DOING OUR FINANCIAL, UH, PRACTICES.
AND, UH, THE, THE BIGGEST PIECE HERE IS THAT THEY'VE SAID TO US, YOUR FUND BALANCES HAVE DROPPED BY 31 MILLION OVER THE PAST TWO YEARS.
IT APPEARS WHEN WE ADOPTED THE FY 24 BUDGET, THAT THE ENDING FUND BALANCE THAT WE STARTED WITH WITH FY 24 DID NOT COME TO FRUITION LIKE WE THOUGHT IT WOULD BOUNCE BACK UP TO.
AND SO WHEN THEY'RE LOOKING AT OUR NUMBERS, THE FIRST THING THAT THEY TOLD US WAS, HEY, WE NEED YOUR FUND BALANCE TO BE BACK UP.
OR YOU ARE GONNA HAVE A RATING DROP AT YOUR VERY NEXT, UH, UH, DEBT ISSUANCE WHEN WE DO THIS.
AND SO, UH, THE VERY NEXT MONTH, UH, WE WENT TO THE FINANCE COMMITTEE, UH, I BELIEVE IT WAS MAY, IT WAS APRIL, MAY, APRIL, MAY, AND, UM, WENT TO THE FINANCE COMMITTEE AND REPORTED THESE THINGS.
WE SAID, HEY, FINANCE COMMITTEE, THIS IS THE
[00:35:01]
RECOMMENDATION THAT WE GOT FROM THE, UH, FROM THE RATING AGENCIES.THESE ARE THE PARAMETERS, THESE ARE BENCHMARKS THAT WE NEED TO WORK ON.
THE FINANCE COMMITTEE SAID, HEY, WE'D LIKE THOSE GUIDELINES.
I THINK MR. POWELL AND I HAD EXTENSIVE CONVERSATIONS ON HOW CAN WE TAKE THE RATING AGENCIES, THEIR BENCHMARKS AND APPLY THOSE TO OUR FINANCIAL SITUATIONS THROUGHOUT SO THAT WE HAVE, UH, UH, THINGS TO WORK THE LEFT AND RIGHT BOUNDARIES TO WORK INTO.
AND SO THE RECOMMENDATION WAS, AS WE MOVE FORWARD, OUR FUND BALANCE NEEDS TO BE ABOVE THE FY 23 STARTING POINT, WHICH IS 65 DAYS.
OKAY? AND SO THAT ADDS ANOTHER PARAMETER TO THE EQUATION, UM, WHICH IS A POLICY DECISION.
THE POOL COUNCIL HAS NOT VOTED ON THAT.
I UNDERSTAND THAT THAT WILL BE, THAT WILL BE ADOPTED WHEN WE ACTUALLY DO THE BUDGET PIECE.
UM, WE ALSO DID THE HOME EXEMPTION IN MAY.
IT'S ANOTHER POLICY DECISION THAT IMPACTS THE OVERALL FORMULA AT THIS POINT.
WHAT ELSE HAPPENED IN MAY? OBJECTION, ANYBODY? ERLER, WE HAD FINANCIAL OPTIONS.
WE HAD FINANCIAL OPTIONS, GOLF COURSE, PAY FOR GOLF COURSE.
WE HAD A DEBT ISSUANCE THAT ALSO CAME FROM THE FY 23 AUDIT THAT WE HAD TO TRANSFER MONEY INTO BOTH OF THOSE EQUALS ROUGHLY $3.2 MILLION.
UH, WITH A FEW OF THE THINGS THAT WE'VE BEEN WORKING ON FROM THE PREVIOUS THING, IT ALL ADDED UP TO AROUND 4 MILLION.
WE HAD THE FIRST HURDLE, UM, THAT THE DIRECTORS WERE WORKING ON, AND WE SPENT QUITE A BIT OF TIME WORKING ON WHAT CAN WE DO TO ADDRESS THIS? REMEMBER I SAID THAT WE TYPICALLY SAVE THREE TO $5 MILLION EACH YEAR.
WE'VE BEEN WORKING ON A CONTINGENCY PLAN OF THE 5%.
HOW CAN WE DO THIS? THIS TEAM WAS PREPARED.
THEY SAID, HEY, WE'VE GOT YOU COUNSEL.
THERE WERE MANY DISCUSSIONS AROUND THIS.
THERE WERE MANY DISCUSSIONS ON DO WE NEED TO CHANGE SERVICE DELIVERY? DO WE, DO WE NEED TO STOP SOME PROJECTS THAT WE HAVE? DO WE NEED TO IMPLEMENT ANYTHING RIGHT NOW? BOTTOM LINE IS WE DID MAKE CHANGES TO SOME THINGS INTERNALLY.
WE DID STOP SOME INFRASTRUCTURE PROJECTS THAT WE HAD.
UM, WE DID CHANGE THE WAY THAT WE OPERATE, BUT WE DID NOT CHANGE SERVICE DELIVERY TO OUR CITIZENS.
THE IMPACT TO THE CITIZENS IS PROBABLY NOT KNOWN OR SEEN AT ALL.
THE RUMORS, THE RUMORS THAT YOU'RE HERE KNOW THAT IS INCORRECT, RIGHT? WE DIDN'T CHANGE.
ALL THE STUFF THAT WE HAD THAT WE WORKED ON WAS INTERNAL, RIGHT? ALMOST ALL OF IT WAS INTERNAL.
WE WERE ABLE TO, UH, ADJUST FOR THAT.
AND THEN IN JUNE, UM, WE'RE HERE TO, UM, THIS TODAY, NOW WE'RE PREPARING FOR FY 25 AND WANT TO FURTHER DISCUSS ALL THE WORK THAT THE DIRECTORS HAVE BEEN DOING, UH, TO MAKE SURE THAT WE'RE ALL ON THE SAME PAGE FOR FY 25.
OKAY? WHAT ELSE YOU GOT? WE HAD DIRECTORS START WITH THE PLA BUDGET.
OKAY? BUT THEN WE HAD THEM DO THE 5% REDUCTION AND POSSIBLE 10.
WHAT WE ARE PREPARED TO PRESENT Y'ALL IN NEXT MONTH STARTED WITH FLAT, IT GREW TO 5%, NOW IT'S AT 10%.
SO WE ARE WITH THE PARAMETERS IN FRONT OF US, OKAY? UM, WE ARE WORKING ON A 10% REDUCTION IN OUR, IN OUR BUDGET.
IT IS, THERE WILL BE SERVICE DELIVERY CHANGES.
THIS IS, THIS IS NOT ANYTHING FROM AN ACUTE SITUATION, MEANING SOMETHING THAT HAPPENED, RIGHT? SHORT TERM.
THIS IS DECADES IN THE MAKING TO GET TO THIS POINT HERE.
SOME POLICY DECISIONS THAT HAVE BEEN MADE.
WHAT WAS THE TAX RATE EIGHT YEARS AGO? FIVE YEARS AGO? FIVE, WELL, FIVE YEARS AGO, WHAT CAME WAS, UH, LIKE 0.825, RIGHT? AND WHERE WE'RE AT NOW, 0.7, 2.72.
SO WE'VE DROPPED THE TAX RATE 10 CENTS.
IT'S COUNCIL'S GOAL TO CONTINUE TO DROP THAT, WHICH IS, UM, GOOD, RIGHT? AS WE CONTINUE TO DROP THAT, WE HAVE TO UNDERSTAND THAT THAT DOES MEAN LESS REVENUE IS COMING IN BY AND LARGE, OKAY? BECAUSE WITH LESS REVENUE COMING IN, I KNOW THE VALUES GROW, THE VALUES GROW, IT OFFSETS
[00:40:01]
WITH THE LOWERING TAX RATE.UM, BUT BY AND LARGE, IT DOES MEAN LESS REVENUE, ESPECIALLY WHEN YOU HAVE HIGH INFLATION TIMES.
OKAY? WHEN YOU'RE, WHEN YOU ARE CAPPED WITH WHAT, UH, SENATE BILL TWO AND HOW MUCH YOU CAN GROW, IT DOES, IT DOES ALTER THE AMOUNT OF MONEY THAT'S COMING IN FOR THE CITY.
SO IF WE, THE DIRECTORS ARE GONNA HATE, THEY HATE WHEN I SAY THIS FINANCIALLY, WE'RE OKAY.
AND THEY'RE LIKE, HOW THE HELL ARE WE FINANCIALLY OKAY? AND YOU'RE ASKING ME TO DO A 10% REDUCTION.
UM, BECAUSE WE ARE, WE CAN WORK TO KEEP THIS FROM CROSSING FOREVER IN PERPETUITY.
IT'S NOT PLANNING FOR THE FUTURE.
IT'S NOT ADDRESSING THE SHIFT THAT WE HAVE TO MAKE.
UM, BECAUSE IF WE KEEP THE STATUS QUO, WE CANNOT PLAN FOR NEW GROWTH.
WE CANNOT LOOK AT THE STRATEGIC PRIORITIES OF THE CITY COUNCIL.
WE CANNOT LOOK AT THINGS THAT WE NEED TO ALTER, UM, FOR THIS ORGANIZATION TO ACCEPT HOW MUCH WE'RE EXPANDING.
WE CANNOT, UH, WORK WITHIN THE, THE FINANCIAL PARAMETERS THAT WE HAVE.
UH, BECAUSE IF WE ARE USING LESS DEBT, WE HAVE TO HAVE, HAVE MORE CASH ON HAND TO DO THAT.
AND SO RIGHT NOW WE DON'T HAVE THE CASH TO DO ADDITIONAL PIECES.
WE DON'T, THEREFORE WE HAVE TO RELY ON DEBT.
SO THERE, THERE ARE TWO CONFLICTING THINGS ALREADY, UM, THAT ARE IN FRONT OF US.
AND IT'S JUST AS WE PREPARE THIS OUT, YES, WE'RE GONNA TALK ABOUT SERVICE DELIVERY CHANGES IN THE FUTURE, BUT IT'S SO THAT WE CAN PREPARE FOR WHAT LIES AHEAD IN BAYTOWN, NOT JUST NEXT YEAR, BUT 10 YEARS FROM NOW.
SO THEY'LL CONTINUE TO PROVIDE THE NEEDED AND WANTED AMENITIES THAT, UH, THE COUNCIL AND WANTS TO PROVIDE FOR THE CITY OF BAYTOWN.
IT'S IMPORTANT TO NOTE THAT BAYTOWN IS NOT ALONE IN THIS.
OKAY? UH, IF Y'ALL REMEMBER, THERESA AND I WERE OUT LAST MONTH IN A TRAINING.
WE CONNECTED WITH SO MANY OTHER CITIES AROUND THE NATION, UM, THAT ARE GOING THROUGH THIS.
IN FACT, I WOULD SAY A LARGE MAJORITY OF THE CONFERENCE WAS FOCUSED ON THIS.
IN FACT, WE WERE ABLE TO MEET RECENTLY WITH, UH, SOME OF OUR, UH, CITY PARTNERS IN VIRGINIA, UH, LOUDOUN COUNTY.
UH, AND, UM, WE HAD A VERY GOOD PRESENTATION FOR HOW THEY DO PROGRAM REVIEWS.
THEY REVIEW EVERY SINGLE PROGRAM IN THE CITY OR IN THEIR COUNTY EVERY FIVE YEARS, BUT THEY HAVE IT ON A REPEATING BASIS, UH, THROUGHOUT THE YEAR WHERE THEY'RE LOOKING AT THAT.
AND IT WAS FANTASTIC TO SEE HOW THEY'RE, THEY'RE WORKING THROUGH THAT PROCESS.
IT MAY BE NEW TO BAYTOWN, BUT WE'RE NOT ALONE.
UH, SOME OF US, SOME OF THE DIRECTORS THAT ARE NEW TO BAYTOWN, IT'S THE STANDARD ANYWHERE ELSE.
LIKE IT'S THE STANDARD ANYWHERE ELSE.
UM, AND WE, BUT THAT'S HELPFUL IN THE ASPECT THAT WE CAN TALK TO SOME OF OUR DIRECTORS THAT HAVE BEEN HERE, THAT HAVE GROWN UP THROUGH THE BAYTOWN CHANNELS AND SAY, HEY, LOOK, WE'VE GONE THROUGH THIS BEFORE.
MAYBE NOT TO THIS EXTENT RIGHT NOW, BUT WE'VE GONE THROUGH THIS BEFORE.
SO WE'RE GONNA TAKE A PAUSE, OR WE'RE GONNA TAKE A PAUSE BEFORE WE LOOK AT THE ACTUAL NUMBERS.
AND, UM, THIS IS JUST OUR FIRST HURDLE, OKAY? AS WE GO THROUGH THIS PROCESS.
AND, UM, THE TEAM HAS DONE A DONE A HELL OF A JOB ADDRESSING THIS.
AND I WANT TO THINK THE FINANCE DEPARTMENT, I WANT TO THANK THE DIRECTORS FOR WORKING THROUGH ALL THIS.
THIS HAS BEEN TWO YEARS OF CONTINUOUS, UM, ANALYZATION OF OUR BUDGET AND TRYING TO FIND WAYS TO MOVE THIS CITY FORWARD AS WE'VE WORKED THROUGH THIS SHIFT.
AND WITH THAT, I JUST WANNA SAY THANK YOU, UH, TO ALL OF YOU.
AND, UH, UH, AS WE JUMP INTO THE REST OF THIS, IT'S GONNA START ADDRESSING OUR SECOND HURDLE, WHICH IS BALANCING THE FY 25 BUDGET.
UH, BUT MAKE NO MISTAKE, IT DOESN'T END THERE.
SO WITH THAT 20 MINUTE BREAK, YOU MEAN A TIME? WHAT'S THAT? I DON'T HAVE A WATCH ON.
LET'S DO LIKE 9 15, 9 10, 9 15.
AND WE'LL COME BACK AND WE'LL START WITH HER NEXT.
[00:45:01]
UH, WELCOME BACK.I HOPE YOU WERE ABLE TO STRETCH YOUR LEGS, UH, GET A LITTLE BLOOD FLOWING.
BEFORE WE MOVE ON TO THE NEXT PORTION OF THE PRESENTATION, I DO WANT TO STOP AND ASK, DO WE HAVE ANY QUESTIONS REGARDING THE TIMELINE? IS THERE ANYTHING THAT I CAN, UH, PROVIDE CLARITY ON? OKAY.
IT TOOK DECADES, UM, TO HAVE TO COME UP WITH THIS, UM, FLAT BUDGET, BUT IT DIDN'T HAPPEN BECAUSE OF, YOU KNOW, ONE VOTE ON ONE ISSUE.
OKAY, I'M GONNA PUT THAT ON A BANNER.
I'M GONNA DRIVE AROUND ON MY CAR.
SO WITH THAT, UM, WE ARE GOING TO MOVE INTO, UH, WHAT OUR CURRENT REALITY IS.
AND YOU'RE GONNA HAVE THIS IN FRONT OF YOU.
YOU DON'T HAVE TO LOOK AT THE TV SCREEN.
UM, AND IF, IF WE NEED TO BLOW ANY, OH YEAH, THAT'S HARD TO SEE IT THERE.
UM, BUT WE'LL KIND OF LIKE WALK THROUGH ALL OF THIS.
AND KIND OF GO OVER, YOU KNOW, THE TIMELINE TO THIS POINT IN TIME AND PUTTING ALL THIS TOGETHER AND REALLY HAVE FOCUSED, UH, CONVERSATIONS ON WHAT THIS IS.
AND SO IF YOU START IN, UH, THE UPPER LEFT CORNER, THE UPPER LEFT CORNER SHOWS AN AVERAGE EXPENSE RATE OF 6.31 AND OR GROWTH RATE OF, UH, EXPENSE GROWTH RATE OF 6.31.
AND YOU MAY ASK, WHAT IS, WHAT IS THAT? WHAT IS OUR, WHAT DO YOU MEAN BY EXPENSE GROWTH RATE? SO WHEN WE LOOK AT OUR FORMULA, OUR ONGOING EXPENSES, ONLY OUR ONGOING EXPENSES GROW ON A COMPOUND AVERAGE GROWTH RATE OVER THE PAST 10 YEARS.
DO I HAVE TO SAY SOMETHING ON THAT? SO LIKE, HISTORICALLY, WHAT I REMEMBER, I THINK STAFF IS USUALLY THEY'VE USED A RULE OF THUMB OF THE 4%, THREE OR 4%, RIGHT? YEAH.
SO IF YOU'RE USING THREE OR 4% FOR DEC FOR YEARS MM-HMM
AND IT'S ACTUALLY 6.3, THAT'S WHY YOU, THAT'S WHY THE THINGS OCCUR HERE, CORRECT? YES.
WHERE LIKE THE BUDGETED AMOUNT VERSUS THE ACTUAL, I MEAN, AND LIKE YOU SAID, THESE ARE JUST EXPENSES WHEN THEY COME IN.
THAT'S, THAT'S WHAT HAS OCCURRED THAT DELTA HAS BUILT UP, I GUESS, RIGHT? IT'S BUILT UP.
IN ADDITION TO THAT, WHAT'S HAPPENED OVER, YOU KNOW, THE LAST DECADE PLUS AS WELL? I MEAN, IS THE BAYTOWN THE SAME SIZE? NO.
IT'S, UM, UH, INFLATION BUILT IN.
WE'VE HAD, YOU KNOW, COMING OFF THE HILLS OF A FINANCIAL CATASTROPHE IN THE NATION AS WELL.
AND THEN LIKE AN EXPLOSION AND THEN LIKE A BUILD DOWN AS WELL.
NOT MAKING EXCUSES FOR IT, RIGHT? NO, THAT'S, IT IS WHAT IT IS.
AND IT'S TRYING TO KEEP UP AND PROVIDE THE SERVICES THAT OUR CITIZENS EXPECT.
AND, UM, TO DO THAT, THE BUDGET GROWS WITH THAT.
AND ALONG WITH GROWING, JUST OVERALL, UM, NEXT TO THE AVERAGE GROWTH RATE UP THERE IS COLA PERSONNEL IS ONE OF THE LARGEST EXPENSES IN ANY BUSINESS PERIOD.
WE HAVE, YOU KNOW, BY AND LARGE, EVERY SINGLE YEAR A STANDARD COLA BUILT INTO FOR BAYTOWN EMPLOYEES, UM, I WOULD ARGUE I WITH YOU FOREVER, THAT THERE HAS TO BE A COLA PERIOD.
UM, WE ALL KNOW THAT WE'RE PAYING A LOT MORE FOR BREAD, WE'RE PAYING MORE FOR CEREAL, GOING OUT TO EAT, WHATEVER THE CASE MAY BE.
WE KNOW WE'RE PAYING MORE, WHICH MEANS OUR EMPLOYEES ARE PAYING MORE.
AND, UM, ZERO TO 4% IS WHAT'S ON THE TABLE RIGHT NOW.
UH, A POSSIBLE CO OF ZERO TO 4%, IF YOU GO TO THE MAX OF THAT, 4% EQUALS ROUGHLY 3.8 MILLION.
OKAY? THE NEXT THING TO THAT IS
[00:50:01]
THE PRESUMED TAX RATE.THESE START TALKING ABOUT OUR POLICY DECISIONS THAT WE, THAT ARE IN FRONT OF US.
THE PRESUMED TAX RATE, UM, IS 71.5.
THE PARAMETERS THAT ARE IN FRONT OF US RIGHT NOW, UH, THAT WAS GIVEN TO STAFF IS THAT THE CITY WILL WORK TOWARDS A HALF CENT REDUCTION OR THE NO NEW REVENUE RATE.
WHICH ONE IS WHICHEVER ONE IS GREATER FOR THE CITIZENS.
AND SO ON A BUDGETARY PIECE, WE ARE LOOKING AT 71 AND A HALF, WHICH IS A HALF CENT REDUCTION AT THIS POINT IN TIME.
WE WILL NOT HAVE THE TAX RATE WORKSHEET COMPLETE UNTIL AUGUST AT THIS POINT, UNLESS TERESA CAN WORK A MIRACLE AND GET IT BEFORE HARRIS COUNTY PROVIDES IT TO US.
UM, AND THEN WE HAVE THE DEBT RATE NEXT TO IT.
AND THE DEBT RATE NEXT TO IT IS 0.26.
WHY IS THAT IMPORTANT? CAN YOU TELL US WHAT IT, WHAT'S, WHAT DOES THAT REPRESENT THE DEBT RATE? OKAY, SO OUT OF OUR TOTAL TAX RATE, GOOD QUESTION, MAYOR.
UM, OUT OF OUR TOTAL TAX RATE, 26 CENTS OF THAT IT GOES TO DEBT.
SO YOU TAKE THE 26 CENTS OUT OF THE 72 THAT WE CURRENTLY HAVE, UM, AND THAT THE REMAINING PORTION IS WHAT PAYS RIGHT FOR THIS 26 CENTS.
THE ONGOING EXPENSES, THE DEBT THAT WE HAVE, 26 CENTS PAYS FOR ALL THE CAPITAL IMPROVEMENTS AND PROJECTS THAT ARE IN THE CITY RIGHT NOW.
NOW, ONE TALKING POINT, AND WHY I'M ASKING WHY IT'S IMPORTANT IS DISCUSSIONS THAT WE'VE HAD AROUND THE COUNCIL ON WHAT PERCENTAGE OF DEBT SHOULD A CITY HAVE.
WE ALWAYS SAY LIKE, WHAT'S, IS THERE A RATIO? THERE'S A SOMETHING, SOME, SOME TYPE OF THRESHOLD, RIGHT? ROUGHLY WHAT IS THIS EQUAL? WHAT IS 26 CENTS OF THE DEBT TAX RATE? ABOUT ABOUT A THIRD, RIGHT? ABOUT A THIRD, ROUGHLY 36% OF OUR TAX RATE IS DEBT.
UM, THE CONVERSATIONS THAT WE'VE HAD, UM, AND OUR FINANCIAL ADVISOR ALWAYS LOVES IT, RIGHT? 'CAUSE HE GETS ASKED, UM, ALL THE TIME BY COUNCILS ALL OVER THE STATE, WHAT'S THE PERFECT DEBT RATE, DEBT RATIO THAT WE SHOULD HAVE HIS ANSWER, THE CITY'S ALLOWED TO GO UP TO 1.5.
SO THAT'S JUST BECAUSE HE DOESN'T WANT TO ANSWER IT BECAUSE THERE'S NO, UH, THERE'S NO PERFECT ANSWER.
IT CAN BE WHATEVER WE NEED IT TO BE TO ADDRESS THE INFRASTRUCTURE NEEDS AND THE PROJECT NEEDS THAT THE CITY HAS AT THIS POINT.
UM, IT'S MY UNDERSTANDING THAT WE DO WANT TO WORK IT DOWN FROM 30 A THIRD OF THE TAX RATE, THOUGH.
THAT'S MY UNDERSTANDING THAT THE COUNSEL WOULD LIKE TO SEE IT COME DOWN, UH, TO MAYBE AROUND 25% OF THE TAX RATE AND STOP RELYING SO MUCH ON DEBT AND MORE CASH FUNDING WHEN, IF, IF AND WHEN POSSIBLE.
OKAY? SO THE BOX ON THE LEFT, THE MIDDLE LEFT IS A MODEL OF, UH, BLESS YOU, IS A MODEL HIGHLIGHTING LOW, MEDIUM, AND HIGH POSSIBILITIES FOR OUR REVENUE IN THE CITY OF BAYTOWN.
UM, FROM THE DATA THAT WE HAVE RIGHT NOW, WHAT WE NEED TO UNDERSTAND THAT IS BUILT INTO THE MODEL IS THAT WE HAVE APPROXIMATELY $2 MILLION IN GROWTH OF OUR IDAS.
WE HAVE $387 MILLION IN VALUE THAT WAS TAKEN OUT OF OUR PROPERTY TAX RETURNS TO, WE HAVE ROUGHLY, UM, $800,000 IN SALES TAX IN GROWTH.
THAT IS ALSO A DANGEROUS GAME TO PLAY BECAUSE WE DON'T WANT TO RELY TOO MUCH ON SALES TAX BECAUSE THERE'S SOMETHING THAT WE DO NOT CONTROL.
SO WE HAVE TO BE VERY CONSERVATIVE WITH THAT APPROACH.
AND THEN WE HAVE, UM, INVESTMENTS ARE DOING BETTER WITH HIGHEST HIGHER INTEREST RATES.
RIGHT NOW, OUR INVESTMENTS ARE DOING BETTER AND WE DO HAVE A CONSIDERABLE AMOUNT OF MONEY, UH, THAT IS BEING INVESTED TO TRY TO, UM, MAKE A LITTLE BIT OF EXTRA CASH, UH, WHEN WE CAN.
SO WHEN YOU LOOK AT ALL OF OUR PROPERTY OR UH, UH, POLICY DECISIONS THAT HAVE BEEN SET UP FOR OUR FORMULA, THIS IS ROUGHLY WHAT WE GET AT THE VERY HIGHEST END.
WE DO NOT SEE IT BEING OVER 138.5 MILLION.
SO IF YOU JUMP DOWN TO THE BOTTOM, THE FY 24 ADOPTED BUDGET IS 130 MILLION.
THE 130 MILLION REPRESENTS THIS.
THIS IS THE ONGOING OPERATIONAL EXPENSES, UM, FOR THE CITY.
THE 6 MILLION THAT YOU SEE UP THERE IS THE NON-RECURRING, OKAY? SO IN TOTAL, THE FY 24 ADOPTED BUDGET IS $136 MILLION.
THE PIECES THAT YOU HAVE ON POSSIBLE GROWTH MODELS HERE, 4%, 6%,
[00:55:01]
AND 8%, WHAT'S OUR AVERAGE GROWTH RATE? SIX.AND SO WHEN YOU LOOK AT THAT, THAT'S 142 MILLION.
NOW I WILL TELL YOU THAT 6% IS NOT OFF 136, OKAY? IT'S OFF ONE 30 ONLY BECAUSE IT WOULD BE DISINGENUOUS OF ME TO DO 6% ON TOP OF THE 6 MILLION BECAUSE THIS NON-RECURRING DOESN'T TYPICALLY GROW LIKE THE ONGOING, UH, ONGOING OPERATIONAL COSTS DO.
AND SO WHAT YOU HAVE UP THERE IN FRONT OF YOU IS ON THE VERY LOW END OF GROWING AT 4%, 139 MILLION, UM, ON THE HIGH END, 144 MILLION.
NOW I'M GONNA COME BACK TO THIS GRAPH.
MAYOR, WHAT'D YOU SAY THIS GRAPH WAS WHEN IT WAS PRESENTED LAST YEAR? WELL, I MEAN, USING YOUR WORDS, I MEAN, YOU SAID THIS WAS EXAGGERATED TO, BUT, BUT TO AT LEAST, I GUESS I HEARD FORGOT THE OTHER WORD YOU USED, BUT BASICALLY TO INCITE DISCUSSION AND TO JUST SHOW THAT THAT ADJUSTMENTS NEED TO BE MADE SO THAT WE CAN NOT, SO WE CAN AVOID THE, THE INTERSECTION OF THESE TWO RIGHT.
AVOID THE INTERSECTION OF THESE TWO LINES.
AND I DON'T WANNA SAY THAT THIS IS AN EXAGGERATION, OKAY? THIS IS NOT HERE TO MAKE A POINT MM-HMM
BUT I DO WANT YOU TO ALSO UNDERSTAND THAT YOU HAVE PIECES OF THE PIE.
'CAUSE I'M GONNA, I'M GONNA STEP AWAY HERE IN JUST A SECOND AND CAROL'S GONNA TAKE OVER SOME QUESTIONS THAT UNDERSTAND WHAT WE'RE DOING NOW, RIGHT? WILL WE GET HERE? WILL, I DON'T KNOW.
I DON'T HAVE THAT ANSWER UNTIL I PRESENT THE BUDGET TO YOU.
BUT IT IS THE CURRENT SITUATION THAT'S IN FRONT OF US AS THE BUDGET IS PRESENTED TO ME AT THIS POINT IN TIME.
WITH THAT, WELL, BEFORE I WANT TO, I WANT TO KIND OF JUST POINT OUT, SO WHAT'S A LITTLE BIT NEWS TO ME, I GUESS YOU WOULD SAY WOULD BE WHEN YOU SHOW, AND I, AND I APPRECIATE THE TIMELINE TO KIND OF LOOK AT WHAT WE'VE BEEN DOING, RIGHT? BECAUSE THERE'S A FEW, I THINK THERE'S TWO STORIES TO TELL.
ONE, AS THE CITY MANAGER EXPRESSED THAT SOME THINGS ARE HAPPENING ON THE, FROM THE ADMINISTRA, LET'S JUST SAY YEARS FROM ADMINISTRATION WHEN IT COMES TO POLICY BASED OFF OF FINANCIAL THINGS, WERE, WERE OCCURRING INTERNAL IN A SENSE.
COUNCIL, OBVIOUSLY THERE'S THINGS WE JUST DON'T KNOW THAT Y'ALL DO ON A DAY-TO-DAY BASIS.
SO YOU HAD THESE THINGS THAT WERE TRANSPIRING OVER YEARS AND YEARS AND YEARS.
UH, AND THEN YOU HAVE A COUNCIL THAT IS TRYING TO GO AND, YOU KNOW, INCREASE, YOU KNOW, THE BASICALLY EXEMPTIONS TO OUR CITIZENS, UH, REDUCE THE TAX RATE FROM WHATEVER IT WAS TO WHERE WE'RE AT TODAY.
SO WE'RE KIND OF LIKE, YOU'RE DOING ONE THING AND WE'RE DOING ANOTHER.
AND THOSE THINGS CONFLICT IN, IN SOME WAYS, RIGHT? 'CAUSE WE'RE TELLING YOU WE WANT MORE FROM YOU, WE WANT MORE FOR OUR CITIZENS, BUT WE WANT YOU TO DO IT WITH LESS RESOURCES.
I MEAN, THAT'S BASICALLY THE MESSAGE WE GIVE THEM, RIGHT? AND SO WE'RE TRYING TO FIND THAT, I GUESS YOU'D SAY THAT BALANCE OF HOW, HOW THAT BE SUSTAINED.
WHAT WAS NEWS TO ME WAS IN MARCH, UH, I DIDN'T, I REALLY DIDN'T, I THOUGHT IT WAS MAYBE MORE JUST SCHEDULING THINGS, BUT WHEN Y'ALL RECEIVED, I'M ASSUMING THE PRELIMINARY TAX NUMBERS, THAT WAS, TO ME THAT WAS THE Y'ALL'S AHA IS WE, WE NEED TO GO AND REALLY REVISIT SOME THINGS, RIGHT? RIGHT.
AND SO IT WASN'T FROM ANY INDIVIDUAL, UH, UH, WHAT YOU SAID, YOU SAY ACUTE EVENTS OR, OR, UM, DISBURSEMENTS.
IT WAS, IT WAS THROUGH WHAT WE ARE LOOKING AT MOVING FORWARD.
MAINLY, I GUESS TAXABLE VALUES OF, OF WHAT WE WILL BE APPROACHING IN THIS BUDGET YEAR.
HOPEFULLY THEY COME IN BETTER THAN PROJECTED.
WE USUALLY ALWAYS, WE USUALLY ALWAYS HAVE, UM, A LITTLE BUMP BEEN CONSERVATIVE.
WELL, YEAH, BUT WE'VE BEEN CONSERVATIVE IN OUR REVENUES, RIGHT? UM, AND SO THAT'S HELPED.
BUT IT'S REALLY KIND OF JUST MASS YEARS AND YEARS OF, I THINK, LIKE YOU SAY, WE NOT TRULY BEING ACCURATE IN OUR, IN OUR BUDGETING, IN OUR BUDGET YEARS AND YEARS BECAUSE IT, YOU BUDGET AND THEN THE END RESULT IN REALITY, LIKE I SAID, WE BUDGET FOR THREE OR 4%, UH, EXPENSE GROWTH AND REALITY IS 6%, RIGHT? SO, SO, UM, ONE LAST THING I, 'CAUSE I FAILED TO MENTION RIGHT NOW.
UM, AS Y'ALL HEARD IN THE TIMELINE, WHEN WE, WHEN WE PUT THIS BUDGET BACK UP FOR, FOR COUNCIL TO CONSIDER, UH, IN A, IN A MONTH OR SO, AGAIN, PROBABLY NO NEW PERSONNEL GROWTH.
AND IF WE DO, IT'S GONNA BE VERY LIMITED AT THIS POINT IN TIME.
[01:00:01]
STILL HAVE TO CONSIDER WHAT IT LOOKS LIKE WITH THE COLA, UM, AND MAINTAINED A, A A, UH, REDUCED LEVEL OF SPENDING, WHICH WE TALKED ABOUT WITH OUR FLAT BUDGET.AND, UH, I, I DON'T WANNA SET ANY FALSE EXPECTATIONS BECAUSE THERE WILL BE CONVERSATIONS AROUND CHANGING SERVICE DELIVERY, UH, ON WHAT WE HAVE.
AND WITH THAT TURN OVER, CAROL.
UM, SO I'M GONNA SEG OFF OF YOUR, YOUR COMMENTS.
UM, SO WE DO WANNA TAKE A MOMENT AND JUST KIND OF WALK THROUGH SOME CONVERSATION.
UM, YOU KNOW, REALLY LOOKING AT EVERYTHING.
WE TALKED ABOUT THE TIMELINE AS WELL AS ABOUT THE DASHBOARD AND, AND STUFF.
AND JUST TAKE A MOMENT FOR EVERYBODY TO JUST KIND OF SIT AND PROCESS, PROCESS ALL OF THAT.
BECAUSE WE, THIS IS KIND OF A NEW REALITY, RIGHT? WE'RE, AS JAY SAID, WE WE'RE MAKING THAT SHIFT.
DIRECTORS HAVE STARTED MAKING THAT SHIFT AS WE GO INTO THE FY 25 BUDGET.
SO REALLY MAKING SURE WE TAKE SOME TIME TO, TO SEE AND HEAR AND FEEL WHERE WE'RE AT.
UM, SO JUST KIND OF LOOKING AT SOME OF THIS, ESPECIALLY THE DASHBOARD.
YOU KNOW, WHAT, WHAT'S STANDING OUT TO YOU? IF Y DON'T PARTICIPATE, WE'RE GONNA MAKE YOU PLAY A GAME.
I KNOW YOU HAVE SOMETHING MIKE.
UH, SAY WHAT STANDS OUT IS THAT WE'VE, UH, REACHED THE INTERSECTION ON OUR, AND, AND I'LL JUMP IN THERE TOO, BUT WHETHER WE DID IT DELIBERATELY, I THINK SOME OF US SAW IT COMING OR NOT, WE HAVE FORCED THE, THE INTERSECTION, BOEING, PREVIOUS MANAGEMENT IN, IN TAX RATES AND EVERYTHING ELSE.
AND WE WOULD JUST GO SPEND MONEY AS A CITY.
WE JUST GO SPEND IT, WE GOT IT, WE GO SPEND IT.
I, I THINK WE MADE THE DECISIONS THAT NO, WE CAN'T DO THAT ANYMORE.
SO WE'VE REDUCED THE TAX RATE, WE REDUCED THE FUND BALANCE, AND WE HAVE FORCED THAT INTERSECTION.
SO NOW AS WE GO FORWARD, NOW WE NEED TO BE STRATEGIC IN R EXPENDITURES.
IF WE WANT TO GO DO A MAJOR PUBLIC PROJECT, AS MY COUNCILMAN COLLEAGUE WOULD, WOULD PUSH, WE NEED TO GO OUT FOR A GENERAL OBLIGATION.
WE NEED THE CITIZENS TO SAY, YEAH, WE'RE WILLING TO PAY FOR THAT, THAT, AND IF THEY ARE, WE CAN RAISE THE TAXES TO COVER IT, BUT WE'RE NOT GONNA HAVE JUST MILLIONS OF DOLLARS IN FUNDS AND EXCESS CO USAGE AND EVERYTHING ELSE.
WE'RE JUST NOT GONNA DO THAT ANYMORE.
SO WE HAVE FORCED THIS ISSUE AND, AND NOW WE CAN GROW IT AND BE MORE, WE'RE STRATEGIC, BUT IT'S MORE STRATEGIC IN OUR EXPENDITURES.
SO YEAH, FLAT BUDGETS ARE ACTUALLY REDUCED BUDGETS.
ANYTHING GREATER THAN A 3% REDUCTION IS STAFFING.
IF AS, AS A NORMAL DEPARTMENT, IF YOU GOTTA REDUCE 5%, YOU'RE GOING TO LOSE PEOPLE.
BUT ARE WE OVERSTAFFED? DO WE PROVIDE ENOUGH SERVICES OR THE LEVEL OF SERVICES THAT'S SOMETHING THAT FROM A POLICY SIDE, WE'RE GONNA HAVE TO STAND ON.
AND IT'S KIND OF LIKE, YOU KNOW, DO WE NEED, AND I'M JUST USING THESE, DO WE NEED 20 CODE INSPECTORS OR CAN WE DO THE GOOD JOB WITH TED? I, I, YOU KNOW, THAT'S A POLICY DECISION WE HAVE TO MAKE.
'CAUSE WE ALL ASK STAFF ALL THE TIME, DO MORE WITH LESS.
BUT WE ALSO HAVE TO UNDERSTAND THAT THAT'S, YOU CAN DO THAT TO A POINT, BUT AFTER THAT YOU CAN'T.
AND WE HAVE TO ACCEPT DIFFERENT LEVELS OF SERVICE, DIFFERENT, DIFFERENT AVENUES.
YOU KNOW, SHOULD WE HAVE A PARK ON EVERY BLOCK OF PICKING ON PARKS PARK? DO WE NEED A BLOCK, A PARK ON EVERY BLOCK? MAN, IT'D BE GREAT, BUT WE REALLY NEED IT.
SO WE'RE AT THAT POINT NOW THAT AS COUNCILMAN POWELL WOULD ALWAYS SAY, NOW WE'RE GONNA HAVE START MAKING TOUGH DECISIONS.
AND THAT'S ON US TO PROVIDE THOSE TOUGH POLICY DECISIONS TO STAFF.
I THINK WE'VE GOT THE STAFF THAT IF WE TELL 'EM THIS IS THE DIRECTION WE WANT TO GO, THEY'LL GET US THERE.
IT MAY BE A ROUGH RIDE, BUT I HAVE CONFIDENCE THAT THEY'LL GET US TO WHERE WE WANT 'EM TO BE.
AND THIS, SO WE HAVE FORCED THIS ISSUE.
SO HERE WE ARE, LET'S MAKE THE BEST OF IT AND MAKE GOOD DECISION.
OTHER THOUGHTS ON ANYTHING THAT WAS STOOD OUT TO YOU OR ANYTHING UN UNEXPECTED OR SURPRISING ABOUT WHAT, WHAT WE SAW OR HEARD TODAY? SO FAR? NO.
WHAT, WHAT IS THE STORY FOR YOU NOW? MIKE SPOKE TO THAT SON.
WHAT ABOUT SOME OF THE OTHERS? YEAH, I UNDERSTAND THE NEED OF, OR THE, THE THOUGHT OF JUST THROWING EVERYTHING OUT TO,
[01:05:01]
TO GOSS AND, YOU KNOW, THE THOUGHT OF LET'S FIND THE MONEY, BUT IS, I MENTIONED AT ONE POINT OF, IF WE'RE JUST SAYING, NO, NO, NO, TO CIPS AND THERE'S MONEY, AND I WAS LIKE, WELL, IF IT HASN'T BEEN PRESENTED TO US, WHERE IS IT AND WHERE ARE WE GOING TO GET IT? AND SO I UNDERSTAND THE TOUGH POLICY DECISIONS, BUT, UM, AT THE SAME TIME, I'M, I'M VERY CAUTIOUS THAT IT'S NOT THAT I DON'T WANT GOS, I THINK GOS ARE GOOD, UH, FOR CERTAIN PROJECTS, BUT IF WE START THROWING EVERYTHING TO GOS, THEN IN MY MIND IS HOW ARE WE GOING TO ACTUALLY FUNCTION WHEN WE HAVE A CITIZENRY THAT IS JUST VERY ANTI CITY PROJECTS BECAUSE THEY DON'T BENEFIT ME ANYWAY.AND SO THAT, THAT FALLS BACK ON US AS NOT JUST COUNCIL, BUT AS A CITY AS A WHOLE TO ENSURE THAT OUR CITIZENRY ARE, ARE REALLY, UM, LOOKING AT WHAT WE'RE DOING, OUR EXPENSES AND EVERYTHING BEFORE JUST GOING AND SAYING, NO, THIS IS A NO FOR ME BECAUSE I DON'T WANNA SPEND ANY MORE MONEY.
I DON'T WANT MY TAXES TO GO UP.
UM, AND SO THAT'S KIND OF WHERE I'M AT IN TERMS OF LIKE CUTTING FROM CP BECAUSE WE, WE FEEL WE NEED TO THROW IT OVER TO, TO THE GOS.
UM, AND SO WHEN WE DO THAT, I JUST WANNA BE MINDFUL OF WHAT PROJECTS DO NEED TO GO INTO THE GOS VERSUS JUST SAYING NO TO ALL C-I-P-E-I.
I GUESS IN, UH, THE ONLY THING I, I GUESS THE INFORMATION I WOULD NEED ON THAT WOULD BE WHAT PROJECTS MOVING FORWARD THAT WE THINK WOULD, IN A SENSE BE G GEO, LIKE WOULD BE GEO TYPE PROJECTS.
AND, AND I'LL GIVE YOU AN EXAMPLE, AND, AND MAYBE I'M, I THINK TRYING TO THINK OF ANYBODY IN THE ROOM THAT WOULD, COULD, COULD, UM, MAKE SURE THAT I'M SAYING THIS ACCURATELY, BUT 2001 WAS THE, UM, WAS LIKE THE FIRST TIME IN A LONG TIME THAT THE CITY WENT OUT FOR BONDS.
I THINK IT WAS $30 MILLION IN STREET BONDS IN 2001.
AND SO, UH, THAT, THAT WAS JUST STREET BONDS.
THAT WAS JUST FIXING, FIXING STREETS, RIGHT? AND SO IN 2009, I THINK THAT WAS OUR NEXT BOND THAT WE DID.
THAT WAS OUR LAST BOND THAT WE DID.
UM, AND THERE WAS, I THINK $30 MILLION IN THE STREETS OR SOMETHING LIKE THAT AGAIN.
AND SO, UM, AT SOME POINT WE JUST ROLLED OVER TO, I GUESS YOU'D SAY CERTIFICATES OF ALLEGATION SO THAT WE CAN CONTINUE TO DO STREETS.
OUR CITIZENS EXPECT US TO DO STREETS.
STREETS REALLY SHOULD BE JUST THE ONGOING, WE GOT THE FIXED STREETS, WE HAVE PLENTY OF STREETS TO FIX IN BAYTOWN.
AND SO WE SHIFTED FROM THE, THE TWO GEO INITIATIVES IN 2001 AND 2009 TO REPAIR AND REPLACE OUR STREETS.
UM, AND, AND NOW WE, WE DO THE COS, WHICH IS THAT THAT ISSUANCE.
SO IS THAT, I'M ONLY SAYING THAT AS AN EXAMPLE, WOULD THAT BE SOMETHING THAT WOULD SHIFT TO GOS AND WE SAY WE CAN FIX THESE STREETS, RIGHT? OR X AMOUNT OF STREET, WHATEVER THE CASE MAY BE, AND WE, WE LET CITIZENS DECIDE ON THAT OR NOT? OR IS IT, SHOULD IT BE AN EXPECTATION THAT THE CITY OF BAYTOWN, WE ARE GOING TO FIX THE WORST OF THE WORST STREETS, YOU KNOW, THROUGH COS? AND SO I JUST WANTED TO, TO DISTINGUISH WHAT WOULD, WHAT WOULD, WHAT WOULD BE THE TYPE OF PROJECTS THAT WOULD BE GEO PROJECTS IN, IN A SENSE? YOU BRING UP A GOOD POINT ABOUT THE EXPECTATION OF STREETS.
I THINK EVERYONE UP HERE HAS AGREED THAT INFRASTRUCTURE IS A FOCUS.
WE TALKED ABOUT THAT AT THE RETREAT.
UM, I WAS PROBABLY THE LEAST HESITANT TO MAKE IT THE FULL FOCUS, BUT I, I REMEMBER EVERYONE ELSE, I KNOW PRINGLE WENT THERE, BUT EVERYBODY ELSE WAS SAYING INFRASTRUCTURE.
SO MY OTHER THOUGHT ABOUT THE, THE, UM, THE WAY WE GET THE MONEY OR WE WE FUND THESE, UM, INFRASTRUCTURE ISSUES, IS, DOESN'T IT COST A LOT OF MONEY TO GO OUT FOR A BOND? DON'T OH, YEAH.
UM, SO I JUST, I THINK THAT WE HAVE TO LOOK AT THE BIGGER PICTURE.
I DON'T THINK THAT WE CAN JUST, UM, I SEE THE POINT IN WHAT YOU'RE BOTH, UM, SAYING, BUT I DON'T THINK THAT WE CAN JUST PUT A HARD NO ON, ON CERTAIN THINGS.
UM, YOU ASKED THOUGH HOW I FEEL OVERALL ABOUT, OR HOW WE ALL FEEL OR WHAT OUR THOUGHTS ARE.
I WILL TELL YOU, UM, FOR ME, EACH DISTRICT HAS VERY SPECIFIC NEEDS.
SOME OF OUR DISTRICTS, UM, WHAT I'VE SEEN MAYBE FROM THE CITIZENS IS, YOU KNOW, WE, WE HAVE PEOPLE THAT COME IN THAT ARE TALKING ABOUT, UM, DD ANNEXATION IN ONE DISTRICT, OR PEOPLE COME IN ALL THE TIME, UH, TO DISCUSS TRAFFIC ISSUES OFF OF 1 46.
I FEEL LIKE, UM, FOR ME AND DISTRICT TWO, AND I'M EVEN GOING TO SAY SOME THINGS ABOUT DISTRICT ONE, THE NEEDS THAT WE SEE IN THE OLDER PARTS OF TOWN,
[01:10:01]
A LOT OF TIMES, UM, REQUIRE MORE MONEY INTERNALLY.THAT THAT'S WHAT IT LOOKS LIKE ON THE SURFACE.
AND, AND I, I COULD BE WRONG ABOUT THAT, BUT SOMETIMES IT FEELS LIKE, UH, THIS PUTS A BIGGER DAMPER ON, UH, DOING A FLAT BUDGET AND REALLY SAYING NO, JUST ALL OUT ON CIP PROJECTS AND THINGS LIKE THAT.
I UNDERSTAND THIS AND, AND I UNDERSTAND THAT WE, WE HAVE TO LOOK AT THE DATA, BUT, UM, AS A REPRESENTATIVE OF DISTRICT TWO, SOME OF THE THINGS THAT, THAT, THAT WE NEED ON OUR SIDE OF TOWN WOULD REQUIRE CIP, UM, SUPPORT AND, AND THINGS LIKE THAT.
SO, UM, MY OPINION IS THAT SOMETIMES IT'S EASIER FOR SOME SIDES OF TOWN TO SAY NO VERSUS THE OLDER SIDES OF TOWN BECAUSE OF THE NEEDS.
BUT, UM, I, I SEE WHAT YOU'RE SAYING.
AND, UM, FOR EXAMPLE, JUST, JUST, WE HAVE INFRASTRUCTURE ISSUES ON TEXAS AVENUE, UM, BUT WE'VE NEVER BEEN ABLE TO ADDRESS THOSE.
I I DON'T EVEN KNOW THAT PREVIOUS COUNCILS EVEN ASKED FOR THOSE, BUT THEY'RE REALLY TIED IN MORE TO ECONOMIC DEVELOPMENT.
SO I THINK THAT THEY WOULD PROBABLY, IF THEY EVER CAME INTO, UH, TO THE CONVERSATION, THEY'D PROBABLY BE SWEPT UNDER THE RUG BECAUSE THEY'RE NOT GONNA IMPACT MAYBE A MAJOR TRAFFIC THOROUGHFARE, YOU KNOW, SAY GARTH ROAD VERSUS DFI, THAT KIND OF THING.
SO I JUST FEEL LIKE, UM, YOU ASKED WHAT OUR, I THINK THE INITIAL QUESTION WAS WHAT OUR ROLE IS AS COUNCIL.
SOMETIMES I FEEL LIKE AFTER I VOTE ON MAYBE THE BUDGET AND, UH, MY POINT OF VIEW ON SPENDING, THEN MY JOB BECOMES OBSOLETE FOR THE REST OF THE YEAR.
BECAUSE IF WE'RE GONNA STICK WITH, UM, THIS WAY OF THINKING, THEN EVERYTHING ELSE IS ALREADY SET.
SO WHAT AM I REALLY DOING? MAKING SURE WE'RE STANDING OR KEEPING UP WITH WHAT Y'ALL EXPECTED US TO DO.
I MEAN, I'LL GIVE I ONE EXAMPLE.
I MEAN, I'M, I'M TALKING IN LIKE, YOU KNOW, EXAGGERATED YES MA'AM.
BUT I MEAN, I, I'M, I'M GONNA MENTION ONE EXAMPLE OF, OF A LARGE PROJECT, RIGHT? BWA EAST, THAT THAT WAS, WHAT, 60 WAS THAT 60 MILLION? HOW MUCH WAS THAT? WELL, IT'S NOT FINISHED YET.
AND SO THAT WAS, ALTHOUGH IT'S BWA, WHICH IS A PSEUDO SEPARATE ENTITY, AT THE END OF THE DAY, WE ISSUE THE BONDS.
IT'S ISSUED IT SIMULTANEOUSLY WITH OUR DEBT, BUT IT'S FUNDED THROUGH B WITH STEEL, RIGHT? YEP.
BUT IT SHOWS AS PART OF OUR DEBT FOR SENTENCE.
SO IT, SO, UM, SO LIKE, IF YOU DON'T MIND THERE.
YEAH, I'M TRYING TO THINK LIKE THAT, I'M TRYING TO THINK OF LARGE PROJECTS LIKE THAT WOULD BE, ARE WHAT ARE THE, I'M TRYING TO GET TO WHAT ARE THE THINGS THAT WE CAN FORESEE GOING OUT FOR GEOS? IS IT STREETS, IS IT EVERYTHING? INFRASTRUCTURES LIKE SEWER, ANYTHING WE DO, LET'S SAY THE MARKET STREET, UH, THAT WE DOING, UM, A MATCH PROGRAM WITH THE COUNTY MM-HMM
I, I, WHAT'S OUR, WHAT'S OUR, I CAN'T REMEMBER IF IT'S A 70 30 OR 50 50 SPLIT, BUT REGARDLESS IF IT'S A 20 MILLION PROJECT, THEN WE WOULD HAVE TO GO OUT TO THE VOTE.
WE GO OUT TO THE VOTERS FOR THE OTHER 10 MILLION TO SAY, WE'RE GONNA PARTNER WITH THE COUNTY ON THIS.
IT'S ALREADY A LONG PROCESS THAT MAKES IT DEPENDENT ON THAT.
IF IT DOESN'T PASS, THEN MARKET STREET DOESN'T GET DONE.
AND THEN, BUT YOU HAVE THE INFRASTRUCTURE NEEDS STILL THERE, REGARDLESS OF THE OUTCOME OF, OF, YOU KNOW, WHAT THE CITIZENS SAY.
WHAT DO, DO YOU DO AT THAT POINT? SARAH'S POINT COMES IN POINT.
BECAUSE IF YOU GO AND SAY, WE WANT TO FIX, YOU KNOW, YOU KNOW, 10 MILES OF STREETS AND THAT DOESN'T PASS, THEN YOU'RE JUST GONNA SAY, OKAY, WE ACCEPT THE STREETS AS IS.
I MEAN, YOU KNOW, THAT'S WHAT CITIZENS NO, I KNOW.
THEY VOTE NO, THAT'S WHAT THEY'RE SAYING.
AND IT, AND I THINK YOU GOING, I, I'M NOT GETTING SOME OF THE, YOU KNOW, IT'S THE, THE, OUR OLDER SIDE OF TOWN MM-HMM
AND THESE ARE ISSUES THAT, THAT HAVE BEEN BEING KICKED DOWN THE ROAD, LIKE WE WERE TALKING ABOUT EARLIER, KICKED DOWN.
THE CANMAN KEEPS GETTING KICKED DOWN THE ROAD.
BUT IF WE DON'T, WE HAVE TO FIRST GET THIS BUDGET IN LINE.
THAT'S THE FIRST THING IS TO GET IT RIGHT.
AND THAT WE, WE, WE DON'T GO INTO NEGATIVE AND INTO MORE DEBT BECAUSE IF WE KEEP DOING THAT, EVENTUALLY THAT'S GONNA KEEP MOVING TOWARDS SIX AND THEN TOWARDS FIVE.
AND THEN NOW WHAT ARE WE GONNA DO IN FIVE, 10 YEARS WHEN EVERYBODY'S IN THIS SITUATION? NOT JUST ONE AND TWO, BECAUSE WE DO WANT TO FIX ONE AND TWO, BUT IT MAY BE, HEY, WE MIGHT HAVE TO PUT A HOLD ON IT AND GIVE US A COUPLE YEARS TO GET THE BUDGET RIGHT, SO THAT WE CAN MOVE FORWARD WITHOUT HAVING TO GO WITH, GO TO BONDS.
AND, AND I THINK THAT'S WHERE WE'RE AT.
AND, AND I KNOW THAT'S NOT WHAT ANYBODY WANTS TO HEAR.
WE WANT TO, WE WANT TO SAY, OKAY, WE WANT TO KEEP CONTINUING WITH PRODUCTION, BUT WE DO HAVE TO PROVIDE OUR CITIZENS OF THEIR BASIC SERVICES AND, AND FOR THE DEPARTMENTS NOW, THEY, THEY'RE NOW HAVING TO START THINKING OUTSIDE THE BOX.
AND I FEEL BAD FOR Y'ALL BECAUSE NOW IT'S GONNA BE, Y'ALL HAVE TO COMPLETELY RE RETHINK
[01:15:01]
HOW Y'ALL HAVE BEEN THINKING OVER THE PAST FIVE YEARS.YOU KNOW, IT'S A WHOLE NEW, IT'S A CRASH COURSE.
AND OF, OF WHAT DO WE HAVE TO DO TO RETHINK TO GET THESE, BECAUSE THEY'RE STILL, THEY KNOW WE NEED THE PROJECTS.
YOU'RE, YOU'RE GONNA, YOU'RE GONNA HIT IT THE WORST BECAUSE THERE'S A LOT OF WHAT'S GOING ON IN YOUR, YOUR DEPARTMENT AND WHERE CAN YOU THINK OUTSIDE THE BOX? WHERE CAN WE GET THINGS DONE? BECAUSE IT STILL NEEDS TO BE PROVIDED.
WE STILL NEED TO FIX THE SEWER LINES.
WE STILL GOTTA FIX WHAT'S GOING ON OVER, OVER ON, UH, OVER ON, UH, ALEXANDER WITH ALL THE SEWER ISSUES WE GOT THERE WITH THE STORM, WITH THE WATER, THAT HAS TO BE DONE, RIGHT? SO HOW DO WE GET IT DONE? YOU KNOW, THAT'S A PROJECT THAT WE'RE GONNA HAVE TO FIGURE OUT.
YEAH, THEY'RE ALREADY DOING THAT.
IT'S GONNA BE ANYTHING BIGGER, BUT THEY'RE STILL MORE FOR THE DIRECTORS, BUT THERE'S STILL MORE TO COME THAT, THAT WE HAVE TO LOOK AT BESIDES JUST WITH THAT.
SO IT IS, I GET WHAT YOU'RE SAYING, COMING FROM THAT
IT'S GONNA GET EVEN MORE TECHNICAL WHEN THESE DISCUSSIONS GET DEEPER BECAUSE THE VOTING BASE AND THE, AND WHERE MOST PEOPLE LIVE IS NOT IN OUR DISTRICT, SO TO SAY.
AND I, I MEAN, WE COULD GET INTO BIG DISCUSSION ON HOW, YOU KNOW, VOTING WORKS AND ALL OF THAT, BUT AT THE END OF THE DAY, UM, IT'S GONNA BE A SMALL PERCENTAGE THAT VOTES AND THE PEOPLE THAT VOTE ARE PROBABLY NOT GOING TO BE ON OUR SIDE OF TOWN AS A LARGER PERCENT.
AND THAT'S, BUT IF WE DON'T FIX IT, IT'S GONNA GET, IT'LL, IT WILL EVEN BE WORSE.
IT'LL TAKE EVEN LONGER TO GET WHAT WE CAN FIX THEN IF WE DON'T GET THIS RIGHT.
WE GOT, WE CAN'T JUST KEEP KICKING AGAIN DOWN THE ROAD.
CAN I BRING THIS BACK TO LIKE, UM, TO THE DASHBOARD AND LIKE LOOKING AT ALL OF IT IN THE ENTIRE, IN ITS ENTIRETY TO LIKE, THINK ABOUT SOME OF THE PIECE, THE POLICY PIECES, AND I'LL, I'LL ALSO ADDRESS THE, THE GEO HERE IN A SECOND, BUT 4% GROWTH UP HERE, UM, IT'S HIGHER THAN THE HIGHEST REVENUE PIECE THAT WE HAVE.
AND SO 4% GROWTH IS 1 39 AND THAT'S THE, THE BUDGET THAT WE CURRENTLY HAVE IN FRONT OF US, UH, FOR FY 25.
AND THE REVENUE AT THE HIGHEST THAT WE SEE IS 138 MILLION.
AND SO WHEN WE TALK ABOUT THESE CIP PROJECTS AND WE TALK ABOUT NOT USING, UH, DEBT, RIGHT? IF WE LOOK AT THE DEBT RATE OF 26 CENTS AND WE'RE TRYING TO BRING THAT DOWN AND USE MORE CASH FUNDING TO USE MORE CASH FUNDING, WELL, WE DON'T HAVE ANY ADDITIONAL CASH AT THIS POINT.
UM, AND WE DON'T WANT TO ACTUALLY INCREASE OUR DEBT RATE AT THIS POINT.
SO WE AREN'T CURRENTLY EVEN PLANNING ON ISSUING DEBT NEXT YEAR AT ALL.
AND WE HAVE FIRE STATION TWO THAT HAS TO BE ADDRESSED.
UM, AND SO IF WE DO THE DEBT ISSUANCE, IT'S GONNA BE PROBABLY SEPTEMBER, WHICH WILL TECHNICALLY STILL BE IN THE FFY 25 BUDGET.
UM, IT'LL BE SEPTEMBER OF FY 25, UH, WHEN THAT DEBT WOULD BE ISSUING ISSUED IN PRACTICAL, IN PRACTICAL TERMS, THAT WOULD MEAN THAT THE DEBT, THE MONEY WOULDN'T COME IN UNTIL OCTOBER, UH, OF FY 26.
AND SO, LIKE WHEN YOU LOOK AT IT IN ITS ENTIRETY FROM THAT PIECE, LIKE I'D LIKE TO HAVE A CONVERSATION ON HOW THAT, YOU KNOW, HOW THAT HITS A LITTLE BIT MM-HMM
UM, AND HOW THAT MAKES YOU GO TOWARDS LIKE THE POLICY DISCUSSION ON WHAT NEEDS TO HAPPEN WITH THAT.
UM, AND THEN QUICKLY ON THE GENERAL OBLIGATION BOND, UM, I KNOW THERE'S A, UM, PLUS AND MINUS ON BOTH SIDES OF THE PIECE, UM, WHERE IT CAN BE BENEFICIAL TO THE CITY, IS IT, TO MIKE'S WORD, STRATEGIC? IT IS STRATEGIC ON BEING DONE AT THAT POINT.
YOU KNOW, LIKE WHAT WOULD HAPPEN IS THAT YOU WOULD HIGHLIGHT ALL OF THESE PROJECTS THAT NEED TO BE ADDRESSED OVER THE NEXT THREE TO FIVE YEARS.
AND, UM, FRANK'S TEAM AND THE DEPARTMENT HEADS WILL GET TOGETHER SAYING, HEY, LOOK, WE FORESEE THIS GROWTH.
WE NEED TO HAVE THIS HERE, RIGHT? AND WE'RE GONNA PUT THIS ON A PLAN.
AND THEN THAT PLAN WOULD BE, WE'RE GOING TO ADDRESS THIS, THIS, AND THIS.
THAT WOULD OUTLINE STREETS, RIGHT? LIKE, AND IT WOULD BE BUNDLED LIKE A STREET PACKAGE.
SARAH, TO YOUR POINT, IT'S NOT JUST SAYING DISTRICT TWO STREETS, IT'S SAYING ALL STREETS IN THE CITY WOULD BE ADDRESSED SOME THIS YEAR, SOME THIS YEAR, AND SOME THIS YEAR.
AND THAT WAY IT'S A CITYWIDE, YOU'RE SPREADING, SPREADING THE WEALTH, SO TO SPEAK, UH, ACROSS THE CITY.
UM, AND THEN WHAT I WOULD ASK OF COUNSEL IF WE WERE TO GO THIS WAY IS THAT YOU HAD A HYBRID APPROACH WHERE THE GENERAL OBLIGATION HELPS YOU DEFINE WHAT YOU'RE GOING TO DO, UM, OVER THE NEXT THREE TO FIVE YEARS.
IT HELPS YOU PLAN ALL THIS OUT SO YOU KNOW EXACTLY WHAT YOU'RE GONNA SPEND.
[01:20:01]
THE SPEND.BUT THE HYBRID APPROACH WOULD BE THAT WE HAVE TO USE COS TO LIKE THE MAYOR'S POINT, UH, IF SOMETHING WERE TO COME IN, UH, LIKE, HEY, MARKET STREET, WE'LL GIVE YOU 30%.
UH, IF YOU CAN CONTRIBUTE 30% OF THE PROJECT, THE COUNTY WILL MATCH 70% OF THE PROJECT.
AND THEN WE WERE LIKE, COUNCIL WOULD BE LIKE, OKAY, THAT'S BUILT INTO OUR PHILOSOPHY THAT BY AND LARGE WE'RE USING GENERAL OBLIGATION, BUT WE HAVE CONSIDERATION POINTS WHERE WE'D GO USE COS TO ENSURE THAT WE'RE NOT, WE'RE NOT, UM, WE'RE NOT MISSING OUT ON SUCH A LARGE GRANT AT THAT POINT IN TIME.
AND YOU WOULD, YOU WOULD WORK THROUGH SITUATIONS LIKE THAT, UM, WITHOUT ADDING, UM, PROJECTS TO THE CIP THAT DON'T HAVE A LOT OF FORETHOUGHT INTO THEM, RIGHT? LIKE SOME OF THE THINGS THAT WE WORK ON POP UP LIKE A MONTH OR TWO MONTHS IN ADVANCE AND YOU'RE LIKE, WELL, I DON'T HAVE A LOT OF DETAILS TO EVEN PUT WITH WHAT THE OVERALL COSTS ARE GONNA BE WITH THIS.
IT'S JUST A BEST GUESS SCENARIO, UH, WORKING WITH ENGINEERS AND EXPERTISE IN THE FIELD.
AND SOMETIMES THAT'S WHY WE HAVE THE CHANGE ORDERS COME IN, RIGHT? LIKE THINGS ARE MORE EXPENSIVE WHEN THAN, UM, UM, THAN WHAT WE DO WITH THE QUICK ANALYSIS ON PIECE.
AND SO I JUST REAY ALL THAT TO LIKE BRING IT BACK TO LIKE LOOKING AT IT FROM A A, A HOLISTIC VIEW WHEN YOU'RE LOOKING AT THIS, AT THIS DOCUMENT.
AND I KNOW THAT WE'VE TALKED ABOUT THAT IN THE PAST AND, AND LOOKING AT DOING THE BUNDLING, UM, BECAUSE I KNOW I GET THAT QUESTION A LOT WITH ONE THAT I BROUGHT TO YOU IN, IN TERMS OF LIKE ONE NEIGHBORHOOD ASKING ME HOW DID ABROOK GET ALL THESE NEW STREETS? AND GLEN ARBOR IS LIKE DETERIORATING, YOU KNOW, WHEN DID Y'ALL VOTE ON THAT? AND SO, UM, I LIKE THE BUNDLING WHEN EVERYBODY GETS TACKLED, UM, BECAUSE I KNOW THAT WAS BROUGHT UP BEFORE, UM, I FORGOT WHEN IT WAS.
AND I THINK FRANK MAY HAVE TALKED ABOUT IT IN TERMS OF HIS NEW STRATEGY, UH, INSTEAD OF JUST FIXING AND FIXING AND FIXING ALONG THE WAY, UH, AND BEING ABLE TO CREATE MORE OF A UNIFORMED PACKET OF, OF HOW WE'RE GOING TO MAINTAIN THE STREETS, UM, TO GET THEM ALL AT TO A CERTAIN LEVEL BECAUSE WE'RE NOT ALL GONNA BE AT THE HIGHEST RATING.
THAT'S NOT GONNA HAPPEN UNLESS IT'S A BRAND NEW STREET THAT JUST OPENED, BUT EVENTUALLY THEY'RE GONNA START GOING DOWN ON PCI.
UM, BUT UM, I THINK I'M, I'M OPEN TO THAT BUNDLING.
UM, AND I, I, I JUST ECHO WHAT I, TO USE YOUR WORDS, I ECHO, UH, WHAT SARAH WAS TALKING ABOUT BECAUSE WHEN WE START GOING OUT FOR, UM, GOS AND THINKING ABOUT HOW THE PROJECTS ARE DONE, THERE'S JUST STILL A HIGH STIGMA WITH THE OLDER NEIGHBORHOODS.
THEY'RE LIKE, THEY DON'T NEED IT.
SO IF WE TACKLE THAT AS A GROUP PROJECT WHERE IT COVERS THE ENTIRE CITY, WE WOULD HOPEFULLY AVOID SOME OF THAT.
AND THAT'S KIND OF WHAT HAPPENED IN THE 2001 STREET BOND, UM, PACKAGE, IF I REMEMBER RIGHT.
WHAT THEY DID WAS, I THINK IT WAS THEY DID SIX DISTRICTS, EVERYBODY GOT $5 MILLION FOR STREETS, BUT SO THEY HAD EQUITABLE RESOURCES, BUT DISTRICTS ONE AND TWO AND A LITTLE BIT OF THREE HAD MORE OF THE NEED OF STREET REPAIR MM-HMM
AND SO, I MEAN, WHAT TOOK PLACE WAS, UH, ACTIVE DISTRICT THREE AND FOUR TO FIX SOME OF THE OTHER STREETS.
WE, THAT WE TRANSFERRED MONEY IN A SENSE FROM SOME COUNCIL DISTRICTS TO THEM TO GET STREETS DONE.
AND THEN EVEN LATER AT THE VERY END WHEN THERE WAS SOME MONEY COBBLED TOGETHER, THAT'S HOW WE DID KEWELL ROAD.
UM, I THINK IT WAS DISTRICT SIX AND THREE THAT WE, WE AGREED IT WAS THE RIGHT THING TO DO FOR THE CITY.
SO IT'S KINDA HARD TO GO AND BE EQUITABLE WHEN THE NEED'S NOT EQUITABLE.
AND THAT'S, TO SARAH'S POINT, PROBABLY.
SO, BUT YOU DO WANNA MAKE SURE THAT, I MEAN, WE HAVE, YOU KNOW, SOME AREAS OF TOWN OBVIOUSLY HAVE NEWER INFRASTRUCTURE, SO THEY HAVE LESS OF THAT, THOSE LARGE PROJECTS, BUT THEY'RE, THEY'RE GETTING OLDER TOO.
YOU KNOW, DISTRICT FOUR, RIGHT? DISTRICT FOUR HAS STUFF.
BAKER ROAD IS, IS A GOOD EXAMPLE OF IT'S, IT'S, IT'S STARTING TO GO AND HAVE ISSUES.
ROLLING BROOK, JUST ON MY DRIVE HERE BETWEEN GARTH AND NORTH MAINE, ROLLING BROOKS, IT'S A ROLLER COASTER.
YOU KNOW, IT'S CONCRETE STREET, BUT IT'S, IT'S NOT SMOOTH IN ANY WAY.
YOU COULDN'T GRIND THAT ONE DOWN SMOOTH.
SO
I, I'M GONNA, UM, GO AHEAD AND, AND WRAP THIS UP.
AND AS SOMEONE, I, I DON'T KNOW IF IT WAS MICHAEL OR JAMES, UM, EARLIER KIND OF SAID IT'S, YOU KNOW, THIS, THIS IS MONEY IN, MONEY OUT, RIGHT? IN ITS SIMPLEST FORM,
AND WHEN WE LAYER IN, WE USED TO HAVE MORE MONEY IN AND WE DIDN'T HAVE TO WORRY SO MUCH ABOUT HOW DO YOU REALLY RACK AND STACK AND PRIORITIZE.
[01:25:01]
WE HAD A LOT OF FREEDOM AND ABILITY TO DO A LOT OF STUFF.AND SO NOW AS Y'ALL STARTED THOSE CONVERSATIONS, IT, IT BRINGS UP WHAT ARE ALL OF THE LAYERS OF THE QUESTIONS, RIGHT? WHAT ARE ALL THE LAYERS IN FIGURING OUT HOW DO WE DO WHAT WE NEED TO DO? UM, SO WITH THAT, UM, WE'RE GONNA GIVE YOU ABOUT A 10 MINUTE BREAK SO WE CAN CHANGE OUT, UM, THE BOARD FOR THE NEXT SECTION.
UM, AND THEN WE'LL BE BACK HERE.
SO WE'VE BEEN HERE, HOW LONG HAVE WE BEEN HERE? TWO AND A HALF HOURS.
ESPECIALLY WITH THAT SHIRT, RIGHT? YOU CAME HAWAIIAN SHIRT FRIDAY.
SO WE ARE, UM, GOING TO KIND OF PEEL BACK SOME OF THE LAYERS OF THE DASHBOARD.
WE'RE GONNA TALK THROUGH THE FORMULA.
IT'S GOING TO BE A CONVERSATION BETWEEN US AND Y'ALL.
I'VE GOT MY MARKER FOR WRITING UP HERE ON THE WALLS.
NOT ON THE ACTUAL WALL THOUGH, CHIEF.
I SAW THE PANIC WHEN YOU LOOKED UP.
UH, I WASN'T TEACHING FOR A LITTLE BIT, SO I KNOW, I KNOW HOW THAT PLAYS OUT.
BUT WE'RE GONNA KIND OF DIVE INTO THE DIFFERENT SIDES OF OUR FORMULA, WHICH JUST SO HAPPY TO PLAY OUT SO NICELY IN THE MIDDLE OF MY BOARD, SO I'M VERY, VERY EXCITED.
UM, SO JAY, LET'S START ON THE LEFT SIDE WITH OUR REVENUES, PROPERTY ACUTE AND TRANSFER IN WHICH ARE, LET'S TALK THROUGH WHAT OUR PARAMETERS FOR REVENUES ARE.
OKAY, SO WE TALKED A LITTLE BIT ABOUT THIS AT THE BUDGET MEETING LAST YEAR.
UH, BUILDING THIS WHOLE EQUATION OUT WHERE WE ALL PLAY A ROLE AND COUNSEL HAS POLICY ROLES IN THIS WHOLE EQUATION.
THE, THE LARGER PART OF THE POLICY GUIDES THAT ARE UP HERE FOR THE CITY COUNCIL ARE WITH THE REVENUE.
AND THE BIGGEST ONE IS THAT WE HAVE OUR PROPERTY TAX.
HOW MUCH DOES THAT BRING IN? ROUGHLY? PROPERTY TAX? ANYBODY DON'T LOOK DOWN? LOOK OR PERCENTAGE? NO, JUST A TO LIKE A ROUGH AMOUNT.
ANYBODY ELSE? JACOB'S LIKE MAYBE A LITTLE MORE, A LITTLE MORE.
WHAT ARE YOU THINKING? UH, WELL, SO THIS IS RESIDENTIAL AND THE IDAS AND EVERYTHING.
SO, OH, YOU HAVE, I I HAVE IDA.
WELL, IT'S PART OF THAT, I'LL ADD IT DOWN.
I SAY I'M GONNA SAY 120,000,020, JUST GUESS.
BUT, UM, AND THE RIGHT ANSWER IS YEAH, ROUGHLY 25 MILLION, 27 MILLION THERE.
WE, 27 MILLION ROUGHLY ARE WE DOING? 25, 27.
THAT'S, I WAS GONNA SAY
HE WANTS TO GUESS WHO WANTS, DO YOU WANT TO GUESS? NOW I KNOW IDAS ARE LIKE 55% OF REVENUE.
SO 70, 70 MILLION, 70,000,035, ALL FIVE.
WHAT'S
AND THAT OTHER, AND THEN WE HAVE SALES TAX.
THE MAYOR, YOU SAID IT'S ROUGHLY HALF, WHICH IS I IDEAS ARE ROUGHLY HALF, SO 55.
SO, SO, SO LET'S SEE, WE'LL BREAK THAT DOWN.
IT'S, WHO'S GOT THEIR CALCULATOR?
SO WHILE THAT, THAT'S, THAT, THAT'S INTERESTING BECAUSE OUR SALES TAX AND PROPERTY TAX ARE ALMOST THE SAME.
AND SO, UM, ARE WE GETTING THE SAME? SO WHAT'S THE, WHAT'S THE POLICY GUIDE RIGHT NOW FOR OUR PROPERTY TAX? I MENTIONED IT EARLIER.
EVERYTHING THAT I'VE SAID HERE HAS BEEN SAID THROUGHOUT THIS MORNING.
SO LIKE, JUST TO KEEP THIS INTERACTIVE, WE'RE NOT FALLING ASLEEP AT, AT THIS POINT.
WHAT'S THE POLICY GUIDE THAT COUNSEL HAS AS PART OF THIS EQUATION WHEN IT COMES TO PROPERTY TAX? THE RATE, THE RATE, THE RATE, WHICH IS OUR CURRENT THING THAT WE'RE OPERATING UNDER RIGHT NOW, IS THE HALF CENT REDUCTION OR THE NO NEW REVENUE RATE AT THIS POINT IN TIME.
AND SO WITH HOW WE ARE BUILT, OKAY, WITH HOW WE ARE BUILT, THE NO NEW REVENUE RATE COULD DRASTICALLY DECREASE, UH, THE PROPERTY TAX RATE.
[01:30:01]
A LOT OF CONTROL OVER THAT.SO IF WE HAVE, UH, IF WE HAVE AMAZING GROWTH, RIGHT? IF WE HAVE AMAZING GROWTH THAT'S JUST UNPRECEDENTED, IT COULD PUSH THAT TAX RATE DOWN EVEN MORE THAN THIS.
AND THEN WE HAVE TO MAKE A DECISION.
WHAT ARE THE REPERCUSSIONS IF WE GO ABOVE THE NO NEW REVENUE RATE? YOU HAVE BOTH THE CITIZENS HAVE TO APPROVE YOUR BUDGET.
LIKE IT CAN BE, NOT NECESSARILY IT'S A ROLLBACK TO VOTE.
WELL, THERE'S A NO NEW REVENUE AND THERE'S A VOTER APPROVED, RIGHT? VOTER WE CAN GO BUT VOTER APPROVAL RATE, BUT GO ABOVE IT.
IT'S JUST GONNA SAY ON THE, ON THE BUDGET THAT IT IS A TAX RATE INCREASE.
AND SO THERE ARE THINGS THAT WE HAVE TO CONSIDER WHEN WE'RE MAKING SOME OF THESE POLICY DECISIONS AROUND US.
AND THAT'S FROM STATE LEGISLATURE, RIGHT? THAT IS THROUGH THE STATE.
BUT WHAT IS THE ONE THING THAT STATE LEGISLATION HAS DONE FOR US THAT IS IMPACTING SOME OF THE POLICY DECISIONS WHEN WE ARE CREATING THIS? WE'VE TALKED ABOUT IT NUMEROUS TIMES AT THIS POINT.
AND THAT'S ROUGHLY LIMITS OUR GROWTH BY 3.5%.
SO THAT'S ANOTHER PARAMETER THAT IMPACTS OUR CHART, UH, UP ON THE BOARD AT THIS POINT.
UM, THE CELL TAX WE'RE MAXED OUT.
OKAY? WE'RE MAXED OUT THE TOTAL TAX RATE FOR THE SALES TAX IN THE, THE STATE THAT YOU CAN GO UP TO IS EIGHT AND A QUARTER.
OKAY? THE CITY GETS ROUGHLY 2 CENTS THAT YOU CAN GO.
UM, THAT 2 CENTS THAT WE HAVE IS BROKEN DOWN THROUGH MANY DIFFERENT PIECES.
SOME OF THE FUNDS ARE, ARE, UH, FIRE CONTROL, SOME OF, UH, FUNDS ARE CCD, SOME OF THE FUNDS ARE MDD.
AND THEN WE HAVE OTHER PIECES, UM, UH, ON CHAMBERS COUNTY SIDE THAT GOES TOWARDS THE CHAMBERS COUNTY EMS. AND IT KIND OF MESSES WITH THE, THE RATE ON BOTH SIDES.
UM, THE NEXT PIECE THAT WE HAVE ARE OUR, OUR REVENUE ACUTE, OUR FEES, RATES, AND FINES.
SO ONCE WE'VE SET THESE POLICY GUIDELINES FOR THIS, THAT IS SET, WE ALL AGREE LIKE IT IS SET UNTIL EACH YEAR WHEN WE CAN POSSIBLY MAKE CHANGES TO THAT.
AT THIS POINT, REVENUE ACUTES IS A LITTLE BIT DIFFERENT.
THAT'S ONE THAT WE CAN LOOK AT.
UM, ANYTIME THAT COUNSEL SO CHOOSES TO REALLY, TO REALLY BRING SOMETHING IN THERE.
I WOULD ASK YOU THOUGH, HOW MUCH TOTAL REVENUE DO WE BRING IN WITH THIS RIGHT NOW? YOU KNOW, WE'RE AT A HUNDRED.
OUR TOTAL REVENUE IS ROUGHLY 136 MILLION RIGHT NOW.
THERE'S OTHER PIECES THAT COME WITH THIS.
SO HOW MUCH THOUGH WITH FEES, FINES, AND FORFEITURES OR, UM, FRANCHISE FEES AND RATES AND OTHER THINGS.
SO JUST ALL ALL OF THE THINGS THAT WE CHARGE SERVICE FOR.
SO THE THING WHEN WE'RE LOOKING AT HERE AND WE'RE LOOKING AT POLICY DECISIONS, AND THEN WHEN WE WANT TO START BALANCING WHERE WE'RE IN TO JAMES, UH, POINT EARLIER, IT'S MONEY IN, MONEY OUT.
AND I'LL COME BACK TO THAT IN A SECOND.
UM, IF WE WANTED TO START MAKING POLICY DECISIONS ON THIS, IF WE RAISED EVERY FEE, EVERY RATE THAT WE HAVE IN THE CITY TODAY, IF WE RAISE EVERY SINGLE ONE OF THEM 20%, IT ONLY BRINGS IN AN EXTRA MILLION DOLLARS.
SO WHILE THIS IS CHARGES FOR SERVICE, IT'S NOT SOMETHING THAT WE SHOULD LOOK AT FOR LIKE A REVENUE GENERATOR FOR THE CITY BECAUSE IT DOES, YES, IT CAN MAKE AN IMPACT, BUT THE IMPACT IS NOT A GOOD ROI WHEN IT COMES TO THE HOLISTIC VIEW OF THE BUDGET.
BECAUSE WHY WOULD YOU THROW THAT EXTRA BURDEN ON PEOPLE FOR THE, FOR THE SERVICES, UM, FOR SUCH A NOMINAL RETURN IN GENERAL FUND? IN IN GENERAL FUND, YES.
AND THIS IS STRICTLY JUST GENERAL FUND THAT WE'RE TALKING ABOUT.
SO STILL THIS IS OUR, THIS IS OUR BABY WHERE WE FOCUS ON A MAJORITY OF THESE THINGS AND THEN WE HAVE OUR TRANSFER IN AGAIN.
UM, I DON'T THINK WE HAVE ANYTHING.
THIS IS JUST SOMETHING THAT, LIKE I SAID AT THE VERY BEGINNING, IT'S KIND OF A GAP FILL.
IT IS A, IT DOES COVER THE ADMINISTRATIVE COSTS TO RUN SOME OF THESE OTHER FUNDS.
SO THERE IS MONEY THAT COMES IN FROM THOSE FUNDS THAT, UM, IS WARRANTED, RIGHT? BECAUSE WE DO DO A LOT OF WORK FOR THOSE DIFFERENT FUNDS.
AND SO, SO WE HAVE TO ACCOUNT FOR THAT MONEY COMING IN.
THERE ARE SOME OTHER THINGS THAT KIND OF AFFECT OUR REVENUE ON THIS SIDE THAT ARE, UM, THE POLICY GUIDES, WHICH IS LIKE THE HOMESTEAD EXEMPTION, WHICH YOU SAW LAST MAY, AND THEN AGAIN THIS MAY, UM, DOES ANYONE KNOW HOW MUCH THAT KIND OF TAKES FROM THE REVENUE FOR THE YEAR? THE TOTAL OF PERCENTAGE? WELL, SO LET'S JUST START WITH THIS ONE.
WE DID 20,000, UH, EXEMPTION ADDED ON LAST MONTH.
THAT WAS ONE POINT, ONE POINT.
YOU'RE CLOSE, YOU'RE CLOSE ON BOARD.
[01:35:01]
ALMOST WE'RE, WE'VE BRACKETED IT NOW.SO THE HOMESTEAD EXEMPTION REDUCED THE REVENUE PARAMETERS BY 1.2 MILLION.
OKAY? UM, AND THEN WE HAVE 65 DAYS IN RESERVE.
WE'LL, I'LL PROBABLY PUT THAT ON THE END, BUT IT IS A PARAMETER, UM, THAT WE CAN PUT ON THAT IT'S STILL SOMETHING THAT WE HAVE TO CONSIDER WITH OUR REVENUE PIECE BECAUSE WE HAVE TO UNDERSTAND THE, THE IMPACT THAT'S GONNA HAVE ON THE OVERALL TO BE, IF IT'S, IF IT'S LESS THAN 65 DAYS, IF IT'S LESS THAN 65 DAYS, WHAT DO WE PROJECT IT TO BE? UM, CAN I COME BACK TO THAT? I WILL ANSWER THAT QUESTION RIGHT NOW.
I'LL COME BACK TO, I'LL TELL YOU THE ANSWER.
THE ANSWER RIGHT NOW AS IT CURRENTLY STANDS UP.
LESS THAN 60 RIGHT? NOW, THIS ONE DOESN'T HAVE A NUMBER ATTACHED TO IT, BUT IT IS A POLICY, UM, GUIDE FOR OUR REVENUE AND, YOU KNOW, THE, UH, NOTE DEBT IN 2026, RIGHT? IT'S SOMETHING THAT WE HAVE TO CONSIDER, UM, WHAT THIS LOOKS LIKE WHEN WE'RE ESTABLISHING THE EQUATION IN ITS ENTIRETY.
UM, IT CAN PROBABLY BE PLACED ANYWHERE UP THERE, BUT IT'S SOMETHING THAT WE'RE LOOKING AT.
UH, NO DENT IN 25 YET SHOULD BE 25, NOT 26.
AND I NEED TO CLARIFY THAT 'CAUSE I'VE ALREADY GOT THE TEXT.
UM, WHEN I'M TALKING ABOUT NO DEBT IN 25, FRANK, I'M TALKING ABOUT GENERAL FUND ONLY.
I'M NOT TALKING ABOUT AWA STORM WATER, UH, WATER SEWER,
IS THAT WHY HE TURNED HE CAN BREATHE? UM, BUT AGAIN, WE STILL HAVE TO ADDRESS FIRE STATION TWO.
UH, THAT IS SOMETHING WE'VE ALREADY COMMITTED TO.
I DON'T WANT SOMETHING TO COME OUT OF HERE TO SAY THAT WE'RE NOT ADDRESSING FIRE STATION TWO.
WE ARE ADDRESSING FIRE STATION TWO.
OKAY? UM, AND IT'S JUST ONE OF THE PARAMETERS THAT ARE BUILT INTO THIS EQUATION AT THIS POINT.
AND I'M JUST TERRIBLE ABOUT FY TWO FIVE VERSUS CAL YEARS.
SO, SORRY GUYS, DON'T MIND THAT.
SO GOING BACK TO UM, JAMES' POINT, THIS IS MONEY AND MONEY OUT.
THIS IS THE MONEY OUT PORTION, RIGHT? THIS IS OUR SERVICE DELIVERY, UM, THAT THE DIRECTORS HAVE BEEN WORKING ON.
AND WHILE COUNSEL DOES SET THE POLICY ON WHAT IS EXPECTED IN THESE DEPARTMENTS, THE STAFF IS GUIDING A LOT OF WHAT'S HAPPENING IN EACH EACH OF THESE DEPARTMENTS WITH THEIR EXPENSES.
UM, WHAT YOU WILL SEE IN THE FY 25 BUDGET IS A SERVICE DELIVERY CHANGE RIGHT NOW, AS WE ARE CURRENTLY PRESENTED, THE BUDGET THAT I HAVE IN MY HANDS IS THIS POINT RIGHT HERE IS 139 MILLION.
AND, UM, IT HAS A FLAT PRESENTED BUDGET.
HOWEVER, AS WE ALSO MENTIONED, THE WE ARE LOOKING AT 5% CHANGES, WHICH EQUALS WHAT? DO Y'ALL HAVE ANY IDEA WHAT THE 5% EQUALS FOR THE, THE BUDGET FOR SERVICE MAINTENANCE AND OPERATION OR SERVICE MAINTENANCE AND, UH, SUPPLIES? UM, 4 MILLION.
OKAY, LESS ABOUT TWO, 2 MILLION.
TWO TO TWO AND A HALF MILLION.
DO YOU WANT AN EXTRA CHANCE? AH, THAT'S OKAY.
I DIDN'T WANT 'EM TO STRUGGLE.
SO ON TOP OF THAT, IF Y'ALL MENTION EARLIER, OR REMEMBER EARLIER I SAID 10% IS WHAT THEY'RE LOOKING AT, WHICH EQUATES TO FIVE, 5 MILLION.
WHAT ELSE HAVE WE GOT SABRINA? SO OVER HERE, UM, YOU KNOW THE NON-RECURRING EXPENSES AS PART OF OUR SERVICE DELIVERY, BUT IT'S ALSO THE SUBSIDIES TO ENTERPRISE FUNDS.
BUT WITH SERVICE DELIVERY IS THOSE EXPECTATIONS FOR OUR COMMUNITY AND FOR STAFF, RIGHT? SO WHEN WE'RE LOOKING AT ALL THOSE AS A WHOLE AND WHAT THE TEAM HAS BEEN WORKING ON, THERE'S THE NON-RECURRING EXPENSES IS BROKEN DOWN INTO A FEW DIFFERENT THINGS.
UM, WE CAN HAVE WAYS TO LOOK AT HOW THAT'S USED.
I WOULD ARGUE IT'S ALREADY BEEN REDUCED FROM 3 MILLION DOWN TO ONE OVER THE PAST FEW YEARS.
I DON'T KNOW IF I'D FEEL COMFORTABLE REDUCING IT ANYMORE AT THIS POINT, JUST BECAUSE THINGS DO POP UP.
UM, IT IS LESS THAN 1% OF THE ENTIRE BUDGET AT THIS POINT IN TIME ANYWAYS.
UH, YOU ALSO HAVE CASH FUNDING FOR SOME OF OUR SUPPLEMENTALS.
IT'S DOWN BELOW 500,000 AT THIS POINT.
UM, AND SO WHEN WE'VE GONE THROUGH THAT, THAT HAS BEEN CHANGED, WHICH IS REDUCING SOME OF OUR SERVICE
[01:40:01]
DELIVERY AT THIS POINT BECAUSE IT'S A LOT OF DEFERRED MAINTENANCE.IT'S A LOT OF DEFERRED MAINTENANCE ON THE ASSETS THAT WE HAVE.
WE'RE TRYING TO FIGURE OUT HOW WE'RE GOING TO ADDRESS OUR VEHICLES, HOW WE'RE GONNA ADDRESS OUR TRACTORS, HOW WE'RE GONNA ADDRESS, UH, A FEW OF OUR DIFFERENT PIECES.
THOSE, THOSE START TO BE POLICY DECISIONS FROM THE COUNCIL LEVEL.
BECAUSE WE HAVE TO DECIDE IF WE'RE GOING TO EX, IF WE'RE GOING TO STAND WITH DEFERRED MAINTENANCE OR IF WE'RE GOING TO MAKE CHANGES TO OVERALL SERVICE DELIVERY IN THE ORGAN OR TO THE CITIZENS SO THAT WE CAN ADDRESS THE ASSETS THAT WE HAVE.
THAT'S HOW THOSE TWO INTERTWINE AND LIKE CAN START A LOT OF DISCUSSION FOR US.
UM, THE, THE OTHER PORTION OF THE NON-RECURRING EXPENSES IS THE SUBSIDIES TO THE ENTERPRISE FUNDS.
UM, WE'VE ALREADY ESTABLISHED THAT WE TALKED THAT HEY, THE THINGS THAT WE ARE SUPPORTING, WE'RE GOING TO CONTINUE TO SUPPORT.
HOWEVER, WE HAVE TO FIND WAYS TO MAKE THEM MORE EFFICIENT.
RIGHT? WE, THAT'S WHY WE HAVE THE CONSULTANT WORKING, UH, WITH THE AQUATICS TEAM.
WE ARE TRYING TO FIND WAYS TO MAKE MORE EFFICIENCIES BUILT INTO THAT BECAUSE THAT IS AN AMENITY THAT WE HAVE AGREED UPON THAT WE WILL CONTINUE TO SUPPORT AND MOVE FORWARD BECAUSE IT IS A FANTASTIC BENEFIT TO THE CITIZENS OF BAYTOWN.
SANITATION COMES BACK TO, WE HAVE DIFFERENT THINGS THAT WE DO.
SOME OF THOSE HAVE BEEN ADDED ON SERVICES OVER THE YEARS.
AND WHEN IT COMES DOWN TO BEING ABLE TO SUPPORT THAT, UM, I BELIEVE 1 MILLION RIGHT NOW, FRANK ONE SANITATION, ONE POINT, YEAH.
SUBSTANTIAL GOING IN THE 25 YEARS.
BUT WE DIDN'T ACCOUNT FOR, UM, THE INCREASE IN BEST TRASH, RIGHT? 240.
SO WE'RE PROBABLY AROUND A MILLION.
OKAY? SO TO HELP SUPPORT THAT IS ROUGHLY A MILLION BUCKS THAT WE HAVE TO CONSIDER.
WELL, THE MONEY IN MONEY OUT PORTION AT THIS TIME GOES BACK TO THIS.
WE'RE GONNA, YES, THAT'S OVER THERE AND OUR SERVICE EXPECTATION, BUT WE'RE GONNA TALK ABOUT WHAT THE RATES ARE, UM, IN THE NEAR FUTURE FOR HOW WE CAN BEST DELIVER THE, THE SANITATION SERVICE THAT THAT IS EXPECTED OF THE CITY COUNCIL.
OR ARE WE GONNA OFFER UP SERVICE DELIVERY CHANGES TO REDUCE THE AMOUNT OF CHANGES THAT NEEDS TO HAPPEN IN OUR RATE STRUCTURES JUST TO UNDERSTAND WHAT THAT SERVICE IS.
'CAUSE WE NEED TO REMEMBER RIGHT NOW WE ALREADY HAVE LESS REVENUE THAN WHAT OUR CURRENT EXPENSES ARE.
AND IF WE'RE GONNA WORK DOWN HERE, DO YOU HAVE OTHER THINGS? IF WE'RE GONNA WORK TO THIS PIECE WITH OUR 65 DAY, UH, RESERVE BALANCE TO GET THERE, WE NEED AN ADDITIONAL $5 MILLION.
SO AS WE CURRENTLY SIT TO GET TO THIS NUMBER RIGHT HERE IS $5 MILLION.
THAT'S WHERE THIS COMES INTO PLAY.
THE 10%, THE 10% HELPS OFFSET SOME OF THOSE PIECES.
IT'S WHERE ALL OF THAT FORMULA WORKING TOGETHER REALLY IS SHOWING, HEY, WITH THE PARAMETERS THAT WE HAVE ALL BEEN COLLECTIVELY WORKING ON, UH, FOR TWO YEARS AT THIS POINT, IS GOING TO, UH, SET UP THINGS THAT WE NEED TO, TO GET TO WHAT WE ESTABLISHED AS GOOD FINANCIAL HEALTH FOR THE CITY OKAY? AND WHAT THE CITIZENS COME TO EXPECT.
SO WITH ALL THAT SAID, UH, THERE'S ONE PIECE THAT I'M FORGETTING RIGHT NOW, BUT THAT'S OKAY.
WELL, THAT IS, I GOT THIS A QUESTION.
JUST SO WE HAVE THE KNOWLEDGE, LET'S JUST SAY, WHAT IS THE HALF CENT INDUCTION IN THE TAX RATE? WHAT DOES THAT REPRESENT IN DOLLARS? I'M, I'M SURE IT'S NOT BIG, BUT IT'S SOMETHING.
YOU WERE LOOKING AT ME, SO I JUST FELT OKAY.
DID I GET IT RIGHT? YEAH, ABOUT HALF A MILLION BEFORE I MISSPEAK.
ALRIGHT, SO IT'S ROUGHLY 500,000.
IT'S STILL DOESN'T ADDRESS THE OVERALL CASE.
YEAH, JUST, AND, UM, YOU KNOW, IT IS, IT'S JUST THE TIME FOR, FOR THE SHIFT, RIGHT? LIKE, UM, I CONTINUE TO SAY THAT JUST TO MAKE SURE THAT WE UNDERSTAND THAT THERE IS A SHIFT IN THE WAY THAT WE'RE THINKING THE WAY THAT WE'RE OPERATING.
UM, AND JUST TO LIKE REALLY BRING IT HOME THAT THAT'S, UM, THAT'S WHERE WE ARE GOING WITH ALL OF THIS AT THIS POINT IN TIME.
SO YOU, SO THE, SO ON THE TAX RATE, RIGHT? SO TAX RATE 7.5, YOU'RE ASKING WHAT THE HALF PERCENT DIFFERENCE, RIGHT? BRANDON? WHAT YOU'RE ASKING.
SO YEAH, IN DOLLARS, I MEAN, SO, SO, SO OUR PROPERTY TAXES BASICALLY ARE TOTAL VALUE OF PROPERTY TAXES ARE LIKE WHAT, I GUESS WHAT, 37.5, 38 MILLION.
[01:45:01]
OH.WHICH IN THE BILLIONS? NO, YEAH, IT'S IN THE BILLION.
YEAH, THE VALUE, THE VALUE BEING, NO, YOU GOT IT.
WELL, AND I'LL KIND OF JUMP IN THERE FROM THE POINT THAT JAKE AND I FIRST CAME ABOARD THE POSITION WE TOOK AND THE PHILOSOPHY WAS THE TAX RATE'S TOO HIGH.
SO WE WORKED DILIGENTLY OVER THE LAST FOUR YEARS OR SO, AND EVEN BEFORE WE CAME ON BOARD COUNCIL WORKED TO REDUCE IT.
I THINK WE'RE AT A POINT NOW THAT, AND WE ALWAYS SAID WE WILL REACH A POINT THAT THE TAX RATE REALLY CAN'T BE REDUCED, BUT WE GOTTA GET TO THAT POINT.
I THINK WHAT WE'RE SEEING TODAY AND AND WHAT WE KNEW WAS COMING, OR AT LEAST I KNEW IT WAS COMING PRETTY QUICKLY, IS WE'RE THERE.
SO DO WE MAINTAIN THE PHILOSOPHY THAT WE WANT TO SEE IT DROP ANOTHER HALF CENT? OR DO WE WANT TO KEEP PHILOSOPHY OF LET'S HOLD OUR GROUND AND KEEP IT AT THE NO NEW TAX LEVEL MM-HMM
AS FAR AS THE STATE REQUIREMENT.
AND AS LONG AS WE'RE MEETING THAT, WE'RE GOOD BECAUSE, YOU KNOW, WE CAN CONTINUE TO REDUCE IT, BUT THEN WE HAVE TO GO TO THE OTHER SIDE AND SIGNIFICANTLY CUT EXPENDITURES, RIGHT? SO I, I THINK WE'RE TO THE POINT NOW THAT AGAIN, I COULD VISIT WITH MY CONSTITUENTS OR CITIZENS SAY, LOOK, WE DID WHAT WE SAID WE WERE GONNA DO AS A COUNCIL BEFORE AND DURING OUR TENURES.
WE'VE REDUCED IT TO A POINT THAT NOW IF YOU WANT US TO CONTINUE TO REDUCE, WE'RE GONNA QUIT DOING STREETS.
WE'RE GONNA QUIT DOING, WE'RE GONNA START, I'M ASKING, THERE'S AN IMPACT.
STREET LIGHTS, I'M GONNA START TAKING STREET LIGHTS OUT.
YOU KNOW, THERE'S, THERE'S A NEGATIVE SIDE TO THIS.
SO AGAIN, AS YOU'VE STRESSED, WE'RE TO THAT POINT NOW WE NEED TO STRUCTURALLY REBUILD AND GROW FROM THIS POINT FORWARD IN THE PAST IS LET'S OVERCHARGE, WE GOT LOTS OF RESERVES 'CAUSE WE'RE CHARGING TOO MUCH, IN MY OPINION.
SO NOW WE'RE GETTING BACK DOWN TO NOW WE HAD ONE YOU SCREAM UNCLE, RIGHT? YEAH.
WE'RE, WE'RE AT THE POINT THAT WE'RE SCREAMING UNCLE NOW WE NEED TO BUILD IT BACK CORRECTLY SO THAT WE'RE, WE NEED SOME RESERVES.
I UNDERSTAND WE NEED TO RAISE THE 65 DAY RESERVE.
I MEAN, THIS IS THE FIRST TIME IN THE 20 PLUS YEARS I'VE BEEN HERE THAT WE DIDN'T EXCEED THE, UH, RESERVE NUMBERS.
SO, BUT THAT WE'VE HAD SOME EXTRAORDINARY EXPENDITURES THIS LAST YEAR CATCHING UP, RIGHT? THAT HIDDEN THINGS THAT WE DIDN'T KNOW ABOUT.
SO, UH, THAT'S A TRUE STATEMENT.
SO AGAIN, WE SET THAT BASED ON WHAT WE KNEW AND THEN WE FOUND OUT WE DIDN'T KNOW SO THAT, BUT I THINK WE'RE TO THE POINT ON THE PRO PROPERTY TAX RATE THAT WE CAN'T CONTINUE JUST TO REDUCE IT BECAUSE WE CAN, WE'VE GOTTA BE STRATEGIC THAT ANYMORE, ANYMORE WE TAKE AWAY, WE'VE GOTTA START TAKING AWAY THE OTHER SIDE.
NOW THERE'S SOME THINGS THAT WE PROBABLY COULD, BUT IT TAKES A LOT TO START DOING.
THREE, FOUR, $5 MILLION WORTH OF REDUCTIONS.
WELL THAT, I MEAN IF YOU THINK ABOUT IT, THE PAST FIVE YEARS, LET'S SAY WE REDUCED IT 10 CENTS, THAT'S $10 MILLION.
THAT, THAT WOULD, YOU KNOW, WE WOULDN'T EVEN HAVE WITH THESE CONVERSATIONS LIKE WE'RE HAVING, IF WE WOULD'VE KEPT IT SAFE.
IF WOULD'VE KEPT IT WOULD'VE BEEN EX EXCEEDING THAT.
BUT AGAIN, YOU KNOW, YOU'RE TALKING REDUCING 5% BUDGET AND YOU AND I HAD THE DISCUSSION, ANYTHING MORE THAN 3%, YOU'RE TALKING ABOUT STAFF BOTTOM LINE.
YOU KNOW, YOU GO TO A DEPARTMENT AND SAY, CUT 5%, THEY'RE GONNA HAVE TO REDUCE STAFF.
AND, AND THAT'S A TOUGH DECISION.
WELL, EVERYTHING IN FRONT OF US IS TOUGH AND UM, A LOT TO WORK THROUGH.
AND WHEN YOU LOOK AT BOTH PIECES, YOU KNOW, YOU LOOK AT HOW EVERYTHING UP HERE IMPACTS WHAT'S UP ON THE BOARD RIGHT NOW, THE, WE STILL HAVE TO FIND WAYS TO ADDRESS THE CIP.
RIGHT? WE STILL HAVE TO FIND WAYS TO HAVE CASH ON HAND.
WE HAVE TO FIND WAYS TO BUILD THE RESERVE AND, UM, I'M NOT SAYING WE NEED TO DO IT ALL THIS YEAR EITHER.
OKAY? AND THIS IS NOT A SKY'S FALLING SCENARIO.
THE SAME THING I SAID LAST YEAR.
AGAIN, WE ARE FINANCIALLY OKAY, I KNOW Y'ALL HATE IT.
UM, WE CAN WORK THROUGH A LOT OF THINGS, UH, IN FRONT OF US.
WE MAY JUST HAVE TO UNDERSTAND WHAT OUR PARAMETERS CURRENTLY ARE, WORK THROUGH THEM, SHIFT THEM, UH, LEFT OR RIGHT, HOWEVER WE SEE FIT.
UM, BUT AT THE SAME TIME, UH, MIKE, TO YOUR POINT, WHEN WE COME TO THE PROPERTY TAX RATE AND THE NO NEW REVENUE, WHAT I DON'T WANT IS TO TAKE A LAISSEZ-FAIRE APPROACH WHERE WE'RE LIKE, HEY, WE'RE JUST, WE'RE CURRENTLY PROVIDING THIS.
WE DON'T NEED TO HAVE THESE HARD CONVERSATIONS BECAUSE WHAT'S THAT, WHAT THAT'S GONNA DO IS IT'S AUTOMATICALLY GONNA DRIVE THE NO NEW REVENUE RATE UP, OKAY? OVER TIME.
BECAUSE IF WE DON'T LOOK AT HOW WE'RE OPERATING RIGHT NOW
[01:50:01]
BY HOW IT'S BUILT, IT'S GONNA DRIVE THAT NO NEW REVENUE RATE UP BECAUSE OUR EXPENSES ARE GONNA CONTINUE TO GROW.AND, UM, IF WE WANT TO BALANCE THAT, WE DO HAVE TO LOOK AT SOME WAYS TO, TO ADJUST OUR SERVICE DELIVERY.
SO WE'RE NOT DOING SO MUCH HERE, RIGHT? UM, BECAUSE I THINK THE INTENT OF COUNSEL ON, ON A THEORETICAL ASPECT, WE WANT OUR ENTERPRISE FUNDS TO SUPPORT THEMSELVES.
THE REALITY IS NOT ALL OF THEM DO.
WE ALSO DON'T WANT TO OVERCHARGE FOR WATER AND SEWER RATES, RIGHT? WE HAVE SOME, UM, SSO THINGS COMING UP THAT WE NEED TO PLAN FOR, THEREFORE WE NEED MORE CASH ON HAND TO ADDRESS A LOT OF THOSE THINGS.
THOSE, THE, THE ADDITIONAL CASH ON HAND AND THE WAY THAT WE DELIVER OUR SERVICES WILL HELP OFFSET THE NEEDED RATE INCREASES IN THOSE AREAS.
SO WE HAVE TO FIND THAT BALANCE ON WHERE WE'RE HAPPY WITH ALL OF THAT.
AND RIGHT NOW, THE TEAM BEHIND YOU IS PUTTING ALL THAT IN PLAY SO THAT WE CAN HAVE THOSE CONSIDERATIONS WHEN, UM, WHEN THE BUDGET BOOKS ARE PRESENTED TO YOU, UM, IN JULY.
AND YOU WON'T HAVE TO, IN AN EFFORT TO NOT GO LINE BY LINE IN THE BUDGET BOOKS WHEN WE GET THEM NEXT, UH, NEXT MONTH, JULY 25TH, JULY 25TH, ALL OF THAT IS GONNA BE HIGHLIGHTED FOR YOU AT THE VERY BEGINNING.
YOU'RE GONNA UNDERSTAND WHAT THE SERVICE DELIVERY CHANGES ARE, RIGHT AT THE VERY FRONT OF EACH DEPARTMENT'S BOOKS.
YOU WON'T HAVE TO GO THROUGH AND, AND UNDERSTAND WHAT, WHERE THIS CAME FROM OR WHY IT'S DONE THAT WAY.
IN ADDITION TO THAT, I DON'T FEEL IT'S FAIR TO YOU TO COME DO EXERCISES LIKE THIS WITH EVERY SERVICE THAT WE OFFER IN THE CITY.
IT PUTS YOU IN A WEIRD SITUATION BECAUSE YOU DON'T DEAL WITH IT DAY TO DAY.
YOU WON'T UNDERSTAND THE COMPLEXITIES AND NUANCES THAT COME WITH EACH SERVICE THAT THE CITY OFFERS.
THAT'S NOT FAIR TO ANY COUNCIL MEMBER BECAUSE Y'ALL DON'T DO THIS EVERY SINGLE DAY.
SO WITH THAT SAID, WE WILL JUST MAKE THOSE DECISIONS AND PUT THEM IN THE BOOK.
YOU AS POLICY MAKERS WILL THEN HAVE THE TIME TO SIT WITH US AND TALK THROUGH WHAT WAS THE REASONING BEHIND THIS? WHERE DID WE GET HERE? OH, HEY JAY, MAYBE YOU DIDN'T REALIZE THAT THIS IS ONE OF THE MOST, UH, COVETED SERVICES THAT WE OFFER HERE IN THE CITY.
AND LET'S JUST FIND OUT A WAY TO PUT THAT BACK TO WHAT THAT SERVICE LEVEL WAS.
AND THEN WE WILL RETOUCH SOME OR WE'LL TOUCH SOMETHING ELSE.
SO PART OF THIS EXERCISE WITH THE 10 IS HAVING THOSE BACKUP PLANS JUST IN CASE WE AREN'T AWARE OF SOMETHING THAT'S SO COVETED THAT WE JUST NEED TO PUSH IT AND PULL IN SOMETHING ELSE.
AND SO AS WE'RE GOING THROUGH OUR EXERCISES INTERNALLY, WE WILL HAVE ALL THAT PREPARED SO THAT WE CAN HAVE GOOD IN-DEPTH CONVERSATIONS ON THE SERVICE THAT Y'ALL KNOW OUR RESIDENTS WANT.
I WANT TO KIND OF JUST MAKE A POINT TOO, SO HOW MANY BUDGETS HAVE WE, I GUESS, ADOPTED SINCE SB TWO AND THE 3.5% CASH, THREE BUDGETS ALREADY 2019? UM, YEAH, SO IT'S 5, 5, 5, 6 BUDGETS AT THIS POINT.
AND SO IF, I MEAN WITH THAT, RIGHT? SO THEY'RE LIKE, OKAY, YOU'RE CAPPED AT 3.5% OF NEW REVENUE, RIGHT? BUT YOU'RE, YOU'RE BASICALLY AVERAGING, LET'S SAY 6%, WHATEVER THE CASE MAY BE, OF NEW ACTUAL EXPENSES, RIGHT? THAT HAVE NOTHING.
I MEAN, IT'S JUST, THAT'S THIS, THE COST OF GOODS AND SERVICES THAT WENT UP.
SO BASICALLY EVERY YEAR WE'RE BASICALLY SEEING A 3% DELTA OF SHORTFALLS THAT WERE FORCED BY THE STATE, RIGHT? ON A, ON A BASIC LEVEL.
AND THEN YOU TIMES THAT BY, IF IT'S FOUR YEARS, WHATEVER, THAT'S 12% LESS REVENUE TO DELIVER SERVICES THAT THEY REQUIRE US TO DO.
AND YOU KNOW, WITH ALL THAT IN, WE DO HAVE THE, THE GROWTH WITH THE CITY THAT HELPS.
AND THE GROWING CITY, IT'S EVEN WORSE BECAUSE IF YOU HAD A STATUS QUO, YOU WEREN'T GROWING TO SAY YOU HAD THE SAME POPULATION, SAME STREETS, EVERYTHING'S THE SAME.
IT'S NOT SO BAD THAT WE'RE A GROWING CITY.
WE HAVE 5,000 NEW HOMES THAT ARE GONNA BE ENTERED INTO, YOU KNOW, THAT OUR, OUR SERVICE AREA, THEY'RE GONNA BE ON OUR STREETS, THEY'RE GONNA BE IN OUR PARKS, THEY'RE GONNA BE IN OUR LIBRARIES, THEY'RE GONNA, YOU KNOW, SO YOU HAVE ALL THESE THINGS THAT ARE GROWING.
AND SO IT'S JUST A, I GUESS COLLECTIVELY IT'S A CULMINATION OF, YOU KNOW, BASICALLY YOU TALK ABOUT BOUNDARIES.
THAT'S A BIG BOUNDARY THAT THE STATE PUT US ON AND I THINK IT REALLY IMPACTS GROWING CITIES THE MOST.
WITH THAT, I'LL TURN IT OVER TO CAROL.
SOME, UH, FINAL QUESTIONS AND THOUGHTS.
UM, SO WE'RE GONNA TAKE A MOMENT.
[01:55:01]
WE'RE GONNA CAPTURE SOME THINGS FROM Y'ALL IN JUST A SECOND, BUT JUST KIND OF BRINGING THIS, THIS BACK, WHAT WE SET OUT TO DO TODAY WAS REALLY TO KIND OF BRING THE CURRENT PICTURE, UM, TO Y'ALL.AND I THINK EVERYBODY AT SOME POINT OR ANOTHER COMMENT SAID, YEAH, WE KIND OF, WE KNEW IT WAS COMING, IT WAS, YOU KNOW, HAD THE AWARENESS, THAT SORT OF THING.
UM, YOU KNOW, BUT THIS IS ALL ABOUT, AND NOW WE'RE HERE, YOU KNOW, THAT MOMENT IN THE FUTURE, WE ARE NOW LIVING IN THAT MOMENT.
UM, AND SO WE REALLY WANTED TO MAKE SURE WE HELPED TO GROUND Y'ALL IN THAT BEFORE WE START TALKING ABOUT ALL OF THE BUDGET AND WHAT'S NEEDS TO CHANGE.
AND Y'ALL HAVE TO START ENTERING INTO ALL THOSE DISCUSSIONS OF WHAT Y'ALL WERE DOING EARLIER, IS HOW DO YOU START BALANCING ALL OF THIS OUT, UM, KIND OF THING.
SO THE THINKING, JUST KIND OF GO BACK THROUGH THE FULL DAY, THE TIMELINE, YOU KNOW, THE, THE DASHBOARD UP HERE, THE FORMULA, ALL OF THAT.
WHAT'S THE THING THAT'S LIKE REALLY KIND OF STICKING IN YOUR MIND? IT'S THAT THING THAT JUST KIND OF KEEPS ON COMING BACK TO YOU COULD BE AN IDEA OR A QUESTION OR CONCERN.
UH, THE THING THAT STICKING IN MY MIND IS THAT WE'RE ENTERING INTO A SEASON, AND IT'S LIKE ANY SEASON YOU HAVE TO BE PREPARED FOR WORK.
UM, AND, UH, STRATEGICALLY SET YOURSELF UP TO WHERE YOU'RE NOT OVEREXTENDED OR UNDERSTANDING IN THAT SEASON.
SO, UM, I LIKE WHAT, UH, COUNCILMAN LESTER HAD TO SAY ABOUT, YOU KNOW, EVEN THINKING ABOUT HOLDING OUR LINE WITH, WITH THE TAX RATE, NOT TRYING TO, NOT TRYING TO GO UP OR DOWN, BUT WE'RE, WE'RE IN THAT SEASON WHERE, UM, WE JUST NEED A HOLE WHERE WE ARE AND YOU KNOW, BUCKLE DOWN.
SO SEASON'S KIND OF, AND SEASONS CHANGE.
IT'S A BEAUTIFUL THING ABOUT SEASON.
THEY DON'T SAY THE SAME LATER TODAY.
WHAT'S THE, WHAT'S THE THING THAT'S GONNA LIKE, WELL, I KNOW COME BACK TO YOU.
WE, YOU KNOW, YOU'RE DISCUSSING FEES AND RATES TO COVER PRINTS COSTS AND, YOU KNOW, WE CAN PRETTY MUCH HAVE THAT DISCUSSION LAST NIGHT.
AND A LOT OF IT WAS TALKING ABOUT, OH, DO WE WANT TO STAY HERE OR BOTTLE THAT WATER LINE, THAT WATER RATE IS HERE JUST TO COVER OUR COSTS.
THAT'S JUST A NOT COVERING OPERATION OR OTHER COSTS.
THAT'S JUST THE WATER TO GET FROM BALL UP TO HERE.
YOU STILL GOT THE OTHER PART THAT WE'RE NOT COVERING, AND WE'RE GONNA HAVE TO LOOK AT THAT.
AND THEN WE'RE GONNA HAVE TO TAKE THE, THE HEAT BACK ON THAT AND OF WHY WE HAVEN'T RAISED THE WATER RATE.
WELL, 'CAUSE WE GOTTA COVER OUR COSTS.
WELL, IT, IT'S NOT JUST THE FEES AND RATES, BUT ALSO THE FINES.
WELL, AND WE TALK A LOT ABOUT, YOU KNOW, THE, THE STATE OF OUR, OF OUR, UH, INFRASTRUCTURE AND, UM, HOMES THAT HAVE NOT FIXED THEIR OWN INFRASTRUCTURE AND THE LINES AND, YOU KNOW, WE'RE, WE'RE, WE'RE TRYING TO HOLD THOSE FINES OF THOSE HOMES WHERE WE MAY NEED TO START INCREASING THOSE AND TO HELP SUPPORT SOME OF THAT INFRASTRUCTURE COSTS.
THE, YOU KNOW, THE, THE LINES BREAK IN INTERNALLY WHERE CUSTOMERS AREN'T FIXING IT.
AND I MEAN, WE INCREASED IT AT ONE POINT, BUT I DON'T KNOW WHAT IMPACT THAT HAS MADE.
YEAH, WELL MAYBE FOR YOU, SO YOU, SO YOU'LL KNOW THAT LIKE, I GUESS CITIZENS THAT HAVE BEEN IDENTIFIED THAT THEY HAVE, UH, A BREAK IN THEIR LINE THAT ALLOWS FOR INFILTRATION OF WHAT TO SAY, STORMWATER, GROUNDWATER, WHATEVER.
UM, YOU KNOW, WE, AT ONE POINT, WELL THE, INITIALLY WE STARTED OFF WITH A $25 AFTER LIKE 12 MONTHS.
IF THEY DIDN'T FIX IT THEN, THEN THEY HAD THE $25 A MONTH FEE.
AND WE THOUGHT, OKAY, THAT WAS GONNA FORCE 'EM TO GET THEIR LINE FIXED.
AND THEN SOME PEOPLE HAVE PERPETUALLY JUST STAYED WITH THE FINE OR THE PENALTY, WHATEVER YOU WANNA CALL IT.
AND SO REALLY THE IDEA WAS WE WANT THEM TO VOLUNTARILY FIX THEIR LINE.
SO WE'RE NOT TREATING THIS, MR. SEMINO MENTIONED LAST NIGHT WHEN IT WAS ASKED, WE'RE NOT TREATING BASICALLY RAINWATER AT OUR WATER, OUR WASTEWATER TREATMENT PLANTS, BECAUSE WE'RE SPENDING A LOT OF MONEY TO, TO TREAT GROUNDWATER.
RIGHT? SO, UM, AND SO WE HAVE TO COME UP WITH, I MEAN, WE TRY DIFFERENT WAYS, UM, BUT OBVIOUSLY JUST A, A MONTHLY PENALTY IS NOT SOMETHING THAT HAS MOTIVATED PEOPLE TO PREPARE THEIR LINES, WHICH ALL, THAT'S ALL WE REALLY WANT.
YOU KNOW, AND THEY'RE PRIVATE LINES.
SO WE, WE'VE LOOKED AT DIFFERENT AVENUES TO TRY TO, HOW CAN THAT BE FINANCED? I MEAN, WE CAN'T FINANCE IT.
YOU KNOW, HOW CAN THOSE REPAIRS BE MADE? UM, THAT'S ALL WE REALLY WANT.
I'M VERY, VERY, UM, CONCERNED ABOUT HAVING TALKS OR EDUCATIONAL TOWN HALLS WITH LOWER MIDDLE CLASS OR BELOW ABOUT THE FACT THAT IT'S GONNA COST MORE ON CITY BILLS
[02:00:01]
SUCH AS WATER.UM, BUT THERE IS A CHANCE SOME OF THE SERVICES WILL ALSO GO DOWN.
UM, THAT MAKES ME NERVOUS TO HAVE THOSE KIND OF CHALLENGING DISCUSSIONS, PARTICULARLY WITH PEOPLE THAT LIVE ON A VERY, VERY FIXED INCOME.
UM, MAKING THOSE KIND OF DECISIONS, YOU KNOW, IT JUST, UM, I DUNNO, MAKES ME NERVOUS.
SO SETTING ASIDE, UH, THE IDEA OF INFRASTRUCTURE WATERS TO RESTRAINTS, THOSE ARE, THOSE ARE THE EASY, EASY THINGS TO THROW OUT THERE, RIGHT? UM, AND THEY'RE BIG, DON'T GET ME WRONG,
UM, BUT THINKING ABOUT SOME OF THE OTHER THINGS THAT WE PROVIDE FOR OUR CITIZENS, HAVING KIND OF HEARD ALL OF THIS AND YOU KIND OF STARTED TALKING ABOUT IT, WHAT ELSE CONCERNS YOU, YOU KNOW, THINKING ABOUT THOSE OTHER SERVICES AND WHAT'S IN FRONT OF US? I MEAN, IT IS, YOU KNOW, WE START, WE, WE, WE HAVE TO LOOK AT, AT, AT OUR BASIC SERVICES.
WE'RE PROVIDING, YOU KNOW, OUR FIRE, OUR POLICE, WATER, SEWER, JUST THE BASIC SERVICES AND HOW THOSE ARE GONNA AFFECT OTHER, OTHER DEPARTMENTS AND HOW THOSE, YOU KNOW, 'CAUSE YOU CAN'T REALLY TAKE AWAY OUR BASICS FROM OUR CITIZENS.
WE HAVE TO LOOK AT WHAT ARE OUR EXTRAS AND, AND WHAT ARE OUR, OUR WANTS AND OUR NEEDS OR WHAT IS GONNA HAVE TO BE LOOKED AT VERY TIGHTLY, WHAT ARE OUR NEEDS AND VERSUS WHAT ARE SOME OF OUR, UM, EXTRAS? AND I KNOW THAT'S NOT WHAT WE WANT TO DO, BUT AGAIN, IT GOES BACK TO WE HAVE TO GET THIS FIXED BEFORE WE CAN START LOOKING AT THAT.
WE, WE, IT, IT IS JUST EVERY, EVERY HOUSEHOLD IN AMERICA IS DEALING WITH THIS RIGHT NOW WITH, WITH INFLATION AND THE ECONOMY AND HOW THINGS ARE, IS THAT, HOW DO I GET MY BASIC NEEDS FIXED? 'CAUSE THESE COSTS GOTTA BE COVERED BEFORE THESE EXTRA WANTS ARE, ARE NORMAL.
I THINK WE'VE TALKED BEFORE ABOUT PHILOSOPHY WITH THIS COUNCIL AND UM, YOU KNOW, I, I DIDN'T GO BACK AND WATCH THE FINANCE COMMITTEE VIDEOS, BUT IT CAME TO MY ATTENTION IN OTHER WAYS THAT THERE WAS TALKS OF, UM, YOU KNOW, CUTTING LIBRARY HOURS AND THINGS LIKE THAT.
SO ONE OF MY BIGGEST CONCERNS IS, YOU KNOW, WHEN WE TALKED ABOUT PHILOSOPHIES AND WANTS VERSUS NEEDS, UM, I WOULD CONSIDER LIBRARY SERVICE A NEED IN A COMMUNITY, PARTICULARLY FOR PEOPLE THAT, UM, ARE LOW TO MIDDLE INCOME OR BELOW, BECAUSE THAT MAY BE THEIR ONLY SOURCE.
UM, THEY MAY NOT BE ABLE TO GO TO BARNES AND NOBLES, OR THEY MAY NOT HAVE INTERNET OR THINGS LIKE THAT.
SO, TO ME, EVEN SOME OF THESE THINGS THAT MAY SEEM SO CUT AND DRY AS FAR AS, UH, A WANT VERSUS A NEED, I THINK THAT THAT COULD EVEN CAUSE CHALLENGES WHEN WE START HAVING THESE CONVERSATIONS.
UM, AND, AND I'M GONNA GO BACK TO THIS AGAIN.
THERE WILL BE SOME AREAS OF TOWN THAT ARE GONNA BE IMPACTED MORE THAN OTHERS, DEPENDING ON THE MAKEUP OF THAT AREA AND WHAT MONEY IS AVAILABLE TO THEM IN THEIR HOUSEHOLD.
KIND OF WHAT STANDS OUT TO ME IS, YOU KNOW, IT'S, IT'S EASY FOR US TO, UM, BLAME PREVIOUS COUNCILS, LIKE FOR LACK OF INVESTMENT IN INFRASTRUCTURE AND THINGS LIKE THAT.
YOU KNOW, WE CAN JUST SAY, OH MAN, WE'VE GOTTA PLAY CATCH UP.
LIKE THEY'VE REALLY MADE SOME BAD DECISIONS.
UM, WHAT'S HARDER IS TO SAY MAYBE THEY ALSO MADE MISTAKES IN OFFERING TOO MANY SERVICES, TOO MUCH.
UM, BECAUSE THEN WE'RE THE ONES THAT HAVE TO CUT BACK ON THOSE THINGS.
UM, AND SO, YEAH, I THINK, LIKE I SAID, IT'S, IT'S JUST IF WE'RE GONNA BLAME 'EM FOR LACK OF, LACK OF, UH, YOU KNOW, INVESTMENT IN SOME AREAS, UH, WE HAVE TO BE THE ONES TO MAYBE LOOK AT ARE WE OFFERING TOO MUCH IN OTHERS? SO, UM, I GUESS I'M LOOKING FORWARD TO SEEING WHAT, WHAT STAFF HAS PUT TOGETHER ON THAT, ON THAT REDUCTION AND SEEING WHAT, WHAT THEY'RE GONNA OFFER.
ONE, ONE AREA THAT I THINK I HEARD EVERYBODY TALK ABOUT IS OUR STAFFING WITH EOC AND, AND, AND, YOU KNOW, WHEN, WHEN THINGS GET HAIRY, YOU KNOW, HOW, WHAT DOES THAT LOOK LIKE? YOU KNOW, WHAT, WHAT, WHAT ARE THOSE, HOW ARE THOSE SURFACES GONNA GET CUT? I MEAN, ARE THEY PROPERLY STAFFED? AND, YOU KNOW, WITH EVERY SEASON WE HAVE SOMETHING IN THE SUMMER WITH HURRICANES IN THE WINTER, LOOK, IT FREEZES ON THE GULF COAST AND, AND EVERYBODY'S LOOKING, YOU KNOW, TO THE EO WHEN, WHEN EMERGENCY, YOU KNOW, WHAT'S THE CITY DOING? SO THAT'S A CONCERN, UM, YOU KNOW, FOR ME AND, AND HELPING CITIZENS RESPOND DURING THAT TIME.
WHAT, WHAT DOES THAT LOOK, WHAT DOES THAT LOOK LOOK LIKE? HOW DOES THAT TIE INTO WHAT WE'RE TALKING ABOUT WITH THE BUDGET AS FAR AS, WELL, SHE SAID CONCERNS AS FAR AS, YOU KNOW, CUTS WERE MADE AND THAT WAS, YOU KNOW, MAYBE CONCERNED HOW'S THAT GONNA AFFECT OUR EOC SERVICES? OH, HAVE THERE BEEN TALKS ABOUT CUTTING EOC SERVICES? UM, NO.
HOW DOES THAT LOOK? I MEAN, I DON'T KNOW IF THERE IS.
[02:05:01]
GOOD TO HEAR THAT THERE'S NOT.UM, WELL, I THINK ALSO WHAT HELPS IS WHEN WE HAVE TO DO THE DISASTER DECLARATION, BECAUSE THAT MEANS, IF I'M NOT MISTAKEN, IF WE DO HAVE STAFF ON OVERTIME OR WORKING AND HAVING TO DO BRUSH OR OR DISASTER RELIEF, WE GET SOME OF THAT FUNDING BACK.
WE HAVE THE POSSIBILITY, YEAH, I WOULD SAY OF GETTING REIMBURSEMENTS FOR THAT TIME.
SO, UM, AND, AND, AND I THINK WE, THOSE ARE, ARE FLEXIBLE.
THERE'S GONNA BE SEASONS THAT NOTHING HAPPENS AND WE'RE, WE ARE HAPPY WITH THOSE SEASONS AND, AND THOSE THAT ARE NOT, WE WOULD AT LEAST HOPE FOR THOSE REIMBURSEMENTS TO HAPPEN TO KIND OF BALANCE OUT THE SPENDING.
YEAH, I THINK WHAT, WHAT I'LL ADD, AND IT'S A LITTLE BIT ALONG THE LINES OF LIKE WHAT, UM, COUNCILMAN POWELL MENTIONED.
SO SINCE I HAVE KIND OF LEGACY OF DIFFERENT, I DON'T KNOW WHAT YOU CALL HURDLES OF, OF BUDGETS, YOU KNOW, THERE WAS DIFFERENT, IT, IT SEEMED LIKE THERE WAS ALWAYS GONNA, THERE WAS ALWAYS BEEN A CHALLENGE EVERY BUDGET, RIGHT? SO I REMEMBER THERE WAS A FEW YEARS WHERE HEALTHCARE COSTS WERE GOING UP AND WE ABSORBED THE COST TO OUR EMPLOYEES AND COUNCIL MADE A DECISION, WE'RE GONNA ABSORB IT 'CAUSE WE HAVE THE MONEY, RIGHT? I'M SURE YOU WERE AN EMPLOYEE AT THE TIME.
SO WE ARE LIKE, WE DON'T WANNA PASS ON THIS 10% INCREASE, WE'LL JUST ABSORB IT, RIGHT? BECAUSE WE DON'T WANNA BITE THE BULLET AS A COUNCIL, RIGHT? WE DON'T DO THAT.
YOU KNOW, AND THEN WE, LIKE, AS MIKE MENTIONED, YOU KNOW, OH, HEY, WE, WE, WE, WE NEED TO REDUCE OUR TAX RATE 'CAUSE WE'RE UP HERE.
WE DON'T WANNA BE UP HERE WHEN IT LOOKS AT LOOKS LIKE IT, WE'LL JUST SAY PEER COMMUNITIES.
SO A LOT OF TIMES I WOULD SAY, AND MYSELF INCLUDED SINCE I, SINCE I WAS THERE, WE DIDN'T MAKE THE TUFTS CHOICE AT THE TIME.
IF WHATEVER, IT'S RIGHT, IF IT WAS ABSORBING HEALTHCARE COSTS, IF IT WAS NOT RAISING RATES, I REMEMBER ONE TIME WE SAID, OKAY, THIS YEAR WE'RE NOT GONNA RAISE THE WATER RATES, SEWER RATES, WHATEVER THE CASE MAY BE, RIGHT? AND WE JUST FOREGO THAT, BUT THE COST IS STILL THERE.
SO WHEN YOU JUST, WHEN YOU COLLECTIVELY ADD THIS UP OVER WHATEVER AMOUNT OF TIME, IT DOESN'T MATTER.
AND EVENTUALLY THAT'S WHAT CAUSES THAT GRAPH, RIGHT? AND SO AS COUNCILMAN POWELL MENTIONED, THEN NOW WE HAVE THIS REALITY TO, TO TRY TO GO AND, AND, AND I GUESS YOU'D SAY MAKE SURE THAT ENSURE THAT WE HAVE A SUSTAINABLE FINANCIAL FUTURE SO THAT THOSE LINES DON'T INTERSECT.
AND THIS IS THE TOUGH CHOICE, RIGHT? BECAUSE WE WANT TO, WE WANNA PROVIDE OUR CITIZENS WITH EVERYTHING, UH, ALL THE SERVICES THEY ONE NEED AND THEN SOME THAT THEY WANT.
AND SO WHERE, WHERE, WHERE DO WE DRAW THE LINE? I KNOW EVERY TIME WE LOOKED AT TOUGH BUDGETS, AND I DON'T HATE, I HATE TO SAY THIS AND I DON'T WANNA SEE IT THIS WAY, BUT IF 80% OF YOUR BUDGET, LIKE IF 80% OF YOUR HOUSEHOLD BUDGET WAS, I DON'T KNOW, GOING OUT TO EAT, THAT'S PROBABLY WHAT YOU'RE HAVE TO CUT IS GOING OUT TO EAT.
SO OUR PERSONNEL IS 80% OF OUR BUDGET.
SO THOSE ARE JUST THINGS WE HAVE TO LOOK AT.
I MEAN, I THINK YOU GAVE AN EXAMPLE, WE CAN GO AND MESS WITH, UM, WHAT WAS IT, THE FINE FEE, YOU KNOW, THE FEES, RATES AND FINES, BUT THE IMPACT IS SMALL, RIGHT? AND SO WE HAVE TO LOOK AT WHAT CAN WE DO TO CONTROL THE LARGE 80% OF THE BUDGET.
THE OTHER 20% CAN MAKE SOME ADJUSTMENTS, BUT REALLY THIS IS, THIS IS WHERE WE HAVE TO LOOK AT MM-HMM
SO YOU ALWAYS TRY TO GET, WHERE'S THE BIGGEST BANG FOR OUR BUCK WHEN IT COMES TO, I GUESS YOU WOULD'VE SAY, UM, COST BENEFIT.
WHAT? COST BENEFIT? WELL, THAT TOO, RIGHT? BECAUSE I MEAN, I DON'T, YOU KNOW, WE HAD SOME VERY TOUGH YEARS.
WE DIDN'T, WE, WE MAY NOT HAVE BEEN ABLE TO GIVE 'EM A RAISE, BUT, YOU KNOW, IN OH 8, 0 9, WE KEPT EVERYBODY ON BOARD AND IT'S JUST, I THINK IT WAS A CULMINATION OF, OF COUNSEL AND ADMINISTRATIVE ADMINISTRATION IN A SENSE BITING THE BULLET.
AND NOW IT'S, NOW IT'S, IT COMES TO FRUITION AT SOME POINT WHEN YOU START TALKING ABOUT, UM, YOU KNOW, THE BIGGEST BANG FOR YOUR BUCK.
THAT'S A SCARY CONVERSATION PARTICULARLY TO HAVE IN THIS ROOM BECAUSE IF YOU GO ALONG WITH, UH, BASIC BUDGETING AND THINGS LIKE THAT, THE BIGGEST BANG FOR THE BUCK IS GETTING RID OF HIGHER SALARIES, WHICH WOULD BE DIRECTORS AND THE PEOPLE AT THE TOP MM-HMM
SO, UM, YOU KNOW, THAT, THAT'S A ROAD, I'M NOT SURE ANYBODY IN THIS ROOM WOULD WANT TO GO DOWN.
WELL, YOU KNOW, IT'S LIKE SOMETIMES THEY SAY, YOU KNOW, SOMETIMES YOU HAVE TO HAVE, HAVE TO HAVE DISCUSSIONS AND THEY'RE TOUGH SUBJECTS.
RIGHT? AND THAT'S NOT WHAT I'M PROPOSING, BUT I'LL, I'LL, THESE ARE, THESE ARE DIFFICULT SUBJECTS TO DISCUSS.
ALL OF IT, ALL THE DISCUSSION HERE REAL QUICK.
UM, WE HAVE THE, AS A COLLECTIVE, UM, HAVE BEEN LOOKING AT EVERYTHING, EVERYTHING FROM GROUND ZERO STARTING UP, WHAT IT LOOKS LIKE, UM, GOING THROUGH THE WHOLE GAMBIT, SEEING WHAT CORE SERVICES ARE SEEING WHERE, WHAT THE, THE NEEDS AND WANTS ARE.
[02:10:02]
AND SARAH, I AGREE WITH YOU.IT'S, IT'S DIFFICULT TO DE DETERMINE WHAT NEEDS AND WANTS ARE.
AND, UM, AND YOU AND EVERY CITY GETS TO DETERMINE ITS OWN NEEDS AND WANTS.
YOU DON'T HAVE TO FIT ANY SPECIFIC MODEL, UH, ON ITS CORE LEVEL.
YOU KNOW, YOU'RE THERE TO PROVIDE SERVICE DELIVERY, WHICH IS GETTING WATER TO YOUR HOUSE AND THE WASTE OUT OF YOUR HOUSE.
YOU'RE THERE TO PROVIDE A ROAD FOR PEOPLE TO GET BACK AND FORTH TO WHEREVER THEY NEED TO GO TO.
YOU ARE THERE TO, UH, PROTECT THEM, HAVE SAFETY AND SECURITY, UH, FINDING WAYS, UH, THAT, THAT PIECES OF SAFETY AND SECURITY ARE PROVIDED AT THE BEST COST.
DOES THAT MEAN TO ALL EXTENTS THAT WE HAVE SAFETY AND SECURITY NOW? NO, IT DOES NOT.
AND SO WE'RE LOOKING AT A LOT OF IT, YOU KNOW, SAFETY, SECURITY IS EXPANDS ON ALL ON ALL LEVELS.
YOU HAVE CODE ENFORCEMENT THAT DOES SAFETY AND SECURITY.
YOU HAVE PLANNING AND DEVELOPMENT THAT DOES SAFETY AND SECURITY.
YOU HAVE POLICE AND FIRE THAT, THAT HAVE SAFETY AND SECURITY ASPECTS, BUT NOT ALL OF THEM ARE PART OF THAT PIECE.
UM, AND THEN YOU HAVE STORM WATER PROTECTION DRAINAGE THAT YOU HAVE TO, UH, GET WATER OUT OF YOUR CITY.
AND THEN YOU HAVE THE ADMINISTRATIVE COST THAT COMES WITH PROVIDING THOSE CORE SERVICES ON THEIR BASIC LEVEL.
THOSE ARE WHAT CORE SERVICES ARE TO ANY AND EVERY CITY.
AGAIN, THE COUNCIL GETS TO DEFINE WHAT OUR CORE SERVICES ARE, AND IT'S, WE DO NOT HAVE TO SETTLE FOR WHAT THAT BASIC UNDERSTANDING IS.
RIGHT? WE CAN GO ABOVE THAT AND WE HAVE, AND WE ARE.
UM, AND THAT'S PERFECTLY FINE.
IT COMES BACK TO YOUR VERY QUESTION, SARAH, ON HOW DO WE DETERMINE, UM, ON A PHILOSOPHY LEVEL ON SUPPORTING PIECES, RIGHT? IT GOES BACK TO WE DON'T WANNA RAISE FINES AND FEES TO AN EXTRAVAGANT LEVEL.
WE DON'T WANT TO HAVE HIGH TAX RATES TO A HIGH LEVEL AND ALSO NOT PROVIDE THE SAME SERVICE ANYMORE.
RIGHT? BECAUSE THAT WAS, THAT WAS YOUR, UM, YOUR CONCERN.
IT'S PROBABLY A CONCERN OF EVERY SINGLE COUNCIL MEMBER UP HERE IS LIKE, I DON'T WANNA TAKE AWAY SERVICE AND CHARGE MORE FOR, FOR WHAT'S HAPPENING IN THE CITY TOO.
THAT'S WHERE WE ARE TRYING TO FIND WAYS TO CHANGE SERVICE DELIVERY, NOT GET RID OF IT, CHANGE SERVICE DELIVERY.
SOME THINGS MAY GET RID OF, TO MR. POWELL'S POINT, LIKE IT'S, IT'S A EX EXTRAVAGANT AMENITY THAT MAY BE HERE.
RIGHT? AND I'M SAYING THAT JUST ON A HYPOTHETICAL, OKAY? UM, IT MAY BE AN EXTRAVAGANT AMENITY THAT JUST NEEDS TO BE REEXAMINED OR IT'S, WE JUST DON'T GET A LOT OF ROI FOR IT ANYMORE, RIGHT? AND WE'RE SPENDING A THOUSAND DOLLARS PER CITIZEN ON THIS ONE EVENT, RIGHT? THAT WE, THAT WE PUT OUT, THAT'S PROBABLY NOT THE BEST USE OF MONEY, SO TO SPEAK WHEN WE GET, YOU KNOW, 20,000 PEOPLE SHOWING UP AND IT ONLY COSTS $10 PER PERSON FOR THAT EVENT, RIGHT? LIKE, WE'D HAVE TO WEIGH THAT AND LOOK AT STUFF LIKE THAT.
AND SO THEN THAT COMES BACK TO THE PHILOSOPHICAL OR POLICY DECISION, HOWEVER YOU WANNA LABEL IT ON.
IF WE HAVE EXTRA CASH, WE CANNOT DO THE EXTRA FINES OR, UM, FEES THAT ARE NEEDED FOR TO PROVIDE THOSE SERVICE DELIVERY THAT WAY.
SARAH, TO YOUR POINT THAT IT'S NOT CHARGING SOMEBODY A LITTLE BIT EXTRA.
LAURA, I THINK YOU HAVE THE, THE SAME CONCERN NOT CHARGING SOMEBODY EXTRA, UM, WHEN THEY DON'T HAVE THE EXTRA QUARTER IN THEIR POCKET ALREADY.
AND THE, THE POLICY DECISION IS THAT WE ARE GONNA USE SOME OF THIS CASH THAT WE HAVE TO HELP OFFSET THAT.
PERSONNEL'S BEEN THROWN OUT A HERE, UM, I WANT TO CALM FEARS THAT WILL COME OUT OF THIS MEETING.
THERE ARE CURRENTLY, THERE IS NOTHING IN THIS PRESENTED BUDGET WHERE ANYBODY IS THAT ANY EMPLOYEE WITH A JOB HAS BEEN CUT FROM THAT BUDGET.
IF I'M MISSING SOMETHING RIGHT NOW, I DON'T THINK, I THINK THAT'S A TRUE STATEMENT.
I DON'T THINK ANYTHING IN THIS PROPOSED BUDGET RIGHT NOW, UM, HAS AN EMPLOYEE NOT HAVING A JOB, UH, AT THE ADOPTION OF FY 25.
ARE THERE SCENARIOS BUILT INTO WHAT THE DIRECTORS ARE WORKING ON WHERE WE DON'T FILL A POSITION THAT'S CURRENTLY VACANT? YES.
UM, OH, OH, THE 10% REDUCTION BUDGET.
[02:15:01]
HAS SOME FTES, BUT THAT'S NOT IN THIS NUMBER RIGHT HERE, RIGHT? THAT'S NOT IN THIS NUMBER.UM, THERE ARE, UM, VACANCIES THAT ARE LOOK, BEING LOOKED AT WITH SERVICE DELIVERIES, UH, SERVICE DELIVERY CHANGES THAT IF THOSE POSITIONS AREN'T FILLED, THOSE POSITIONS JUST MAY NOT BE THERE IN THE FY 25 BUDGET.
BUT WHAT IMPACT DOES THAT HAVE ON THE SERVICE DELIVERY THAT WE HAVE? UM, THERE, IF WE HAVE TO GO TO THE FULL EXTREME AND GO INTO, UH, THE FULL 10%, UM, THEN THERE MAY BE SERVICE DELIVERY.
RIGHT NOW, I DON'T FULLY FORESEE IMPLEMENTING THE ENTIRE 10%, UM, CHANGE IN THE BUDGET.
UM, BUT EVEN IF THAT'S THE CASE, IT'S MY UNDERSTANDING AS WE ARE WORKING THROUGH THIS, THE SCENARIOS WOULD BE INVOLVED WITH PERSONNEL MOVING FROM POSITIONS TO OTHER POSITIONS WITHIN THE CITY.
UM, THEY WOULD MOVE TO OTHER OPEN POSITIONS THAT WE HAVE.
I JUST NEED TO PUT THAT OUT THERE BECAUSE THE, I DON'T WANT THE FEAR TO START COMING OUT OF THIS ROOM THAT SOMEBODY'S NOT GONNA HAVE A JOB TOMORROW OR OCTOBER 1ST.
UM, WILL THINGS CHANGE? YES, THINGS WILL CHANGE, BUT WE ARE, THERE IS NOTHING THAT'S ACTUALLY GETTING RID OF PEOPLE THAT WE CURRENTLY HAVE.
UM, BEFORE WE CLOSE, I'M GONNA HAVE ONE MORE QUESTION.
UM, OBVIOUSLY WE WILL BRING BACK A BUDGET FOR Y'ALL TO REVIEW WITH OUR RECOMMENDATIONS IN IT.
UM, OUTSIDE OF THAT, UM, REALLY KIND OF FOCUSED ON ANYTHING THAT YOU'VE HEARD TODAY OR THE IDEAS OR ANYTHING.
IS THERE ANY ADDITIONAL INFORMATION YOU NEED BROUGHT BACK, YOU WANNA HAVE FURTHER CONVERSATION ON TO GET CLARITY OR WHATEVER SO THAT YOU'RE PREPARED, UM, TO REVIEW BUDGET, ANY LINGERING QUESTIONS OR MISSING INFORMATION? I DO REMEMBER AT THE LAST EXERCISE YOU GAVE US, OR YOU MENTIONED SOMETHING ABOUT, UM, AND WE TALKED ABOUT IT AT, AT THE FINANCE COMMITTEE, HOW OUR RESERVES AND, AND GENERAL FUND AMOUNT, UM, IMPACTS OUR RATINGS.
AND SO IS THERE A THRESHOLD OF WHERE WE NEED TO BE? IS IT THE 65? 65? OKAY.
I THINK FOR INFORMATION, UH, AND YOU CAN JUST EMAIL US IF YOU LIKE.
WHEN IT SAYS SUBSIDIES TO ENTERPRISE FUNDS, COULD YOU LET US KNOW WHAT THAT AMOUNT, AT LEAST THE LAST YEAR'S BUDGET, WHAT THAT AMOUNT IS? 4 MILLION PER, YOU KNOW, EITHER IN TOTAL OR HOW IT'S BROKEN UP, BUT YEAH.
I, I'D LIKE TO SEE THAT BROKEN OUT AS TO WHAT ENTERPRISE FUNDS AND HOW MUCH.
YOU KNOW, WHICH ONES AND HOW MUCH BECAUSE IF IT'S AN ENTERPRISE FUND, THAT'S SOME OF THE DISCUSSIONS THAT WE'RE GONNA HAVE TO DO IS, YOU KNOW, CAN, CAN WE REASONABLY RAISE RATES OR WHATEVER TO, TO MAKE THOSE ENTERPRISE FUNDS MORE BALANCED? UM, LESS SUBSIDIZED.
'CAUSE IT MAY BE THAT NO, WE CAN'T RAISE RATES THERE.
WE'LL GO AHEAD AND CONTINUE, BUT I'D LIKE TO SEE WHAT THAT, THOSE NUMBERS ARE.
ANYTHING ELSE? ANY OTHER INFORMATION QUESTIONS? YEAH, REMEMBER THIS IS NOT THE SKY'S FALLING SCENARIO.
THIS IS THE SKY IS NOT FALLING.
WE HAVE THE OPPORTUNITY TO REBUILD A BUDGET THAT IS GONNA SET THE CITY UP, UH, IN A VERY GOOD POSITION FOR THE YEARS TO COME.
UM, WILL IT RE WILL IT HAVE A LOT OF CONVERSATION AROUND IT? ABSOLUTELY.
UH, BUT IT'S GONNA BE GOOD POSITIVE CONVERSATION.
AND THIS IS NOT A DOWN SITUATION AT ALL.
THIS IS NOT A DEBBIE DUNNER SITUATION.
THIS IS A CONTINUOUS EFFORT THAT WE WILL MAKE AS A GROUP.
WELL, WHAT I, I WILL SAY WHAT I DON'T LIKE TO, WHAT I DON'T LIKE TO SEE AND HEAR IS, IS THE MISINFORMATION.
LIKE I ALREADY HEAR THAT, YOU KNOW, POLICE IS CUTTING SERVICES TO OUR CITIZENS ALREADY.
AND SO THOSE ARE, THOSE ARE, UM, INACCURATE.
AT THE VERY LEAST THEY'RE INACCURATE.
SO, UM, KIND OF LOOKING FORWARD, UH, RIGHT NOW WE DO HAVE JULY 11TH WORK SESSION THAT WE WILL BE HAVING SOME, SOME MORE DISCUSSION.
YOU WILL NOT GET YOUR, THAT'S A REGULAR COUNCIL MEETING.
I DON'T THINK WE HAVE A JULY 11TH WORK SESSION.
OH, JUST RIGHT BEFORE THE COUNCIL MEETING.
WE UNDERSTAND THAT A FEW OF YOU WILL BE GONE.
BUT WE DELIBERATELY KEPT IT VERY GENERIC FOR JULY 11TH, BECAUSE WE UNDERSTAND THAT NOT EVERYBODY WILL
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BE HERE.THEY CAN, WE JUST, IT WASN'T ON OUR CALENDAR, SO, OH, OKAY.
UM, THE 25TH, ALSO REGULAR COUNCIL MEETING.
UH, WE'LL HAVE THE WORK SESSION BEFORE THAT, UM, TO DO BUDGET.
UM, YOU SHOULD RECEIVE YOUR BUDGET ON THE 25TH.
UM, AND THEN, UM, DO WE HAVE THE DATE IS THE EIGHTH, 13TH, AND 14TH STILL.
OKAY, SO, SO THEN AUGUST THE EIGHTH, 13TH AND 14TH, UM, WILL ALSO BE DOING BUDGET, UM, TO GO THROUGH THAT.
SO
SO THE EIGHTH IS A REGULAR COUNCIL DAY.
UM, SO THAT'LL BE A WORK SESSION.
AND THEN THE 13TH AND 14TH ARE SPECIAL, UH, SESSIONS BECAUSE ON MY CALENDAR IT SHOWS CANCELED FOR WORK SESSIONS FOR THE 11TH, RIGHT? FOR 11TH AND AUGUST 8TH.
THAT'S WHY I'M THROWING IT OUT THERE.
I MEAN, THEY, THEY'RE ALL MINE, BUT IT NOT CANCELED.
UM, ONE OTHER THING I I JUST WANNA TAKE A MOMENT FOR, UM, SABRINA OVER HERE WHO HAS BEEN SLUGGING THROUGH LIKE CRAZY, HELPING DO ALL OF THIS STUFF.
UM, SO YOU DIDN'T HAVE THE TIME.
HER LAST ABSOLUTELY LA LAST DATE.
THE DOCTOR WILL LET HER AT THIS POINT IS THE 14TH.
SO YOU MAY OR MAY NOT SEE HER AGAIN.
SHE WANTS TO GET THROUGH, UH, JULY 4TH.
I WANNA HEAR BRETT YOUNG, SHE WANTS TO HEAR BRETT YOUNG, SO Y'ALL KEEP YOUR FINGERS CROSSED FOR HER.
UM, BUT HUGE THANKS TO SABRINA AND WELL WISHES TO HER.
SHE'LL BE TAKING A LITTLE TIME OFF VERY SOON.
ALRIGHT, UM, WITH THAT, THAT'S ALL.
UH, ARE YOU HAPPY WITH YOUR THANK YOU ALLALL.
SO BEING THAT BAY COUNCIL, CITY COUNCIL HAS ADDRESSED, IT'S ONE, WELL, TWO, UH, AGENDA ITEMS AS MEANS IS NOW ADJOURNED.