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HELLO LADIES AND GENTLEMEN.[ CALL TO ORDER: Mayor Bill Wells]
WELCOME TO THE JOINT MEETING.IT'S A JOINT SPECIAL MEETING OF THE OKLAHOMA CITY COUNCIL HOUSING AUTHORITY SUCCESSOR AGENCY TO THE ALCOHOL REDEVELOPMENT AGENCY.
THE MEETING IS ALCOHOL TO ORDER AND I'D LIKE TO ASK THE CITY CLERK TO CALL THE ROLE.
ALL COUNCIL MEMBERS ARE PRESENT.
CLAY, SHANE, WOULD YOU MIND COMING UP AND LEADING SOME OF THE PLEDGE AND WOULD THE AUDIENCE BE WILLING TO STAND FOR THE PLEDGE AND THEN REMAIN STANDING FOR A MOMENT OF SILENCE AFTER? THANK YOU.
PLEASE PLACE YOUR HAND OVER YOUR HEART AND REPEAT AFTER ME.
I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA AND TO THE REPUBLIC FOR WHICH IT STANDS, ONE NATION UNDER GOD, INDIVISIBLE, WITH LIBERTY AND JUSTICE FOR ALL.
ALL RIGHT, THANKS FOR COMING OUT ON A HOT TUESDAY EARLY TODAY.
[1. Fiscal Year 2019-20 Preliminary Annual Budget Summary RECOMMENDATION: That the City Council, Housing Authority, and the City of El Cajon as Successor Agency to the former Redevelopment Agency receives the proposed City of El Cajon Fiscal Year 2019-20 Preliminary Budget Summary.]
TO START WITH ITEM ONE, WHICH IS THE FISCAL YEAR 2019 THROUGH 2020 PRELIMINARY ANNUAL BUDGET AND STAFF WILL TELL US ABOUT THIS.MR MAYOR, MEMBERS OF THE CITY COUNCIL STAFF IS PLEASED TO PRESENT THE 2019, UH, 20, UH, BUDGET FOR THIS UPCOMING FISCAL YEAR.
UM, THE PURPOSE OF TODAY OR THIS AFTERNOON'S AGENDA ITEM IS TO PRESENT THE BUDGET AS A DRAFT, SEEK ANY INPUT OR FEEDBACK FROM THE COUNCIL BASED ON THAT FEEDBACK AND INPUT.
WE'LL PRESENT A FINAL DOCUMENT FOR CITY COUNCIL ADOPTION AT YOUR JUNE 25TH MEETING.
UM, I WILL MAKE A FEW INTRODUCTORY REMARKS AND I'LL TURN THE REST OF THE TIME OVER TO CLAY.
SHANE, THE CS FINANCE DIRECTOR TO GO THROUGH SOME DETAIL ON THE BUDGET.
SO, UM, I THINK IT'S IMPORTANT TO RECOGNIZE THAT STAFF HAS TAKEN A CONSERVATIVE APPROACH IN THIS BUDGET.
AND WHAT I MEAN BY CONSERVATIVE AS WE'VE, UM, REFLECTED REVENUES NOT IN A, AN AN OVERLY OPTIMISTIC MANNER, BUT, BUT REALLY BASED ON WHAT WE REALLY THINK IS, UM, SOME POTENTIAL LIKELIHOODS OF A RECESSION.
UM, WE'VE SEEN SOME RECENT NEWS, ACTUALLY CONFLICTING NEWS IN SOME WAYS, LOTS OF EXPANSION AND OTHER AREAS.
UH, UM, WE'RE, WE'RE DOOMED FOR RECESSION.
SO, UH, WE'VE TAKEN A, A PRETTY MODEST CONSERVATIVE APPROACH IN PROJECTING SALES TAX REVENUE IN PARTICULAR.
UM, WE THINK THAT THIS BUDGET MEETS THE COMMUNITY'S NEEDS.
WE THINK THAT IT CONTINUES TO PUSH SOME INNOVATIVE IDEAS AND CONCEPTS AND INCLUDES MONEY TO DO THAT.
AND IT ALSO ADDRESSES THE MARKET CONDITIONS FOR OUR LABOR AGREEMENTS.
AS YOU KNOW, LATER ON OR AT THE LAST COUNCIL MEETING, THE COUNCIL ADOPTED OR APPROVED TO LABOR AGREEMENTS.
AND AT YOUR NEXT MEETING YOU'LL BE CONSIDERING THREE MORE LABOR AGREEMENTS.
AND THOSE LABOR AGREEMENT, UM, CONDITIONS ARE, UH, REFLECTED IN THE BUDGET.
SO IN TERMS OF A CONSERVATIVE APPROACH, UH, THE GENERAL, THIS BUDGET, UH, MAINTAINS A GENERAL FUND RESERVE EQUAL TO 57% OF GENERAL FUND EXPENDITURES.
THIS IS FAR BEYOND THE MOST GOVERNMENTS IN SOUTHERN CANADA OR ANYWHERE IN CALIFORNIA.
WE THINK THIS IS HEALTHY BECAUSE THE COUNCIL HAS BEEN PRUDENT WITH ITS RESERVES OVER THE, UM, RE YEARS, EVEN AFTER COMING OUT OF THE RECESSION WHERE SOME CITIES HAVE NOT DONE THAT, IT MAINTAINS, UH, THIS GOAL OF HAVING 20% OPERATING RESERVE AND THAT'S CONTINUES TO BE MAINTAINED.
WE ARE, UM, RECOMMENDING THE USE OF THE CITY'S CALPERS PENSION RESERVE FUND FOR ABOUT $880,000 THIS YEAR BECAUSE OF THIS SPIKE THAT WE'LL BE SEEING THIS YEAR.
WE'LL PROBABLY CONTINUE TO SEE THAT SPIKE OVER THE NEXT TWO YEARS, BUT IT STARTS FLATTENING OR SOFTENING, UM, IN YEARS THREE, FOUR AND FIVE.
UM, IX, IF YOU WERE TO EXCLUDE OUR PENSION COSTS, WHICH ARE GOING UP DRAMATICALLY IN MR SHANE, WE'LL ADDRESS SOME OF THOSE ISSUES.
OUR PERSONNEL COSTS INCREASED BY 4% AND ALL OTHER COSTS, MATERIALS, SUPPLIES, CONTRACTUALS CONTRACTUAL SERVICES INCREASED BY ONLY 1% OVER THE PREVIOUS YEAR.
SO WE'RE HOLDING A EXPENDITURES PRETTY TIGHT IN TERMS OF MEETING THE COMMUNITY'S NEEDS.
WE BELIEVE THAT THIS BUDGET, UM, UH, ADDRESSES SOME OF THE PROBLEMS THAT WE'VE BEEN HAVING WITH OUR PUBLIC SAFETY.
IN TERMS OF, UH, RETENTION AND ATTRACTION, WE THINK THAT THIS WILL, THIS BUDGET WILL HELP CREATE SOME STABILITY WITH WITHIN OUR POLICE DEPARTMENT IN PARTICULAR, AND ALSO OUR FIRE DEPARTMENT.
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WE ALSO THINK THAT IT ADDRESSES SOME HOMELESS ISSUES.UH, IT SPECIFICALLY FUNDS THE HO HOUSING NAVIGATOR PROGRAM, THE HOMELESS ASSISTANCE PROGRAM.
IT ALSO THROUGHOUT THE BUDGET IN BEDS, MONEY RELATED TO ENFORCEMENT EFFORTS, UM, OVER TIME BEFORE POLICE OFFICERS AND PUBLIC WORKS AS WE DO CLEAN UP EFFORTS.
AND IT ALSO INCLUDES FUNDS FOR A CONTRACT WITH ECT LLC TO HELP WITH CLEANING UP AFTER HOMELESS ENCAMPMENTS AND HOMELESS AREAS.
UH, IN TERMS OF ECONOMIC DEVELOPMENT, THIS BUDGET REFLECT SOME AGREEMENTS THAT THE CITY HAS MADE OVER THE PAST FEW YEARS WHERE WE'VE INCENTIVIZED SOME ECONOMIC GROWTH.
SO THE BUDGET REFLECTS SOME CONTRACTUAL RESPONSIBILITIES THERE.
THAT ALSO INCLUDES SOME STUDIES, SOME MONIES FOR SOME STUDIES TO TAKE ADVANTAGE OF THE OPPORTUNITY ZONES THAT ARE WITHIN THE CITY.
AND AS YOU RECALL, UM, L CONE HAS THE ONLY OPPORTUNITY ZONES IN EAST COUNTY AND IT'S AN OPPORTUNITY TO ATTRACT INVESTMENT TO THE CITY.
SO, UM, IT INCLUDES SOME FUNDING FOR SOME STUDIES AND YOU'LL BE HEARING MORE ABOUT THOSE OVER THE NEXT FEW MONTHS AS WE PRESENT THE, THE OUTCOMES OF THOSE STUDIES IN TERMS OF PUBLIC INFRASTRUCTURE OR CAPITAL IMPROVEMENT, THE BUDGET HAS A LOT OF FUNDING ALLOCATED TOWARDS THIS.
THE MAJORITY OF THAT FUNDING IS GRANT FUNDING.
IT INCLUDES PARK IMPROVEMENTS.
IT INCLUDES, UM, $150,000 CONTRIBUTION FOR INSTALLING LIGHTS, UM, AT MONTGOMERY MIDDLE SCHOOL, MONTGOMERY, MONTGOMERY MIDDLE SCHOOL, WHICH WOULD BE A JOINT PROJECT WITH THE SCHOOL DISTRICT.
AND WITH THE COUNTY OF SAN DIEGO, IT INCLUDES TWO POINT $5 MILLION IN SMART GROWTH MONEY FOR IMPROVEMENTS AROUND THE L CONE TRANSIT CENTER.
IT ALSO INCLUDES 10 POINT $5 MILLION IN STREET IMPROVEMENTS, UPGRADES TO OUR DRAIN SYSTEM, UM, ADA IMPROVEMENTS AT OUR SIDEWALKS, JUST THE PLETHORA OF ROAD IMPROVEMENTS.
AND AGAIN, THE MAJORITY OF THOSE FUNDS ARE COMING FROM GRANT MONIES OR OR NON GENERAL FUND MONIES.
UM, THE BUDGET ALSO REFLECTS FUNDS FOR COMMUNITY EVENTS SUCH AS, UH, THE ONES THAT WE'RE ABOUT TO EMBARK WITH RIGHT NOW, WHICH IS CONCERTS IN THE PARK.
UH, IT INCLUDES MONEY FOR THE MOTHER GOOSE PARADE AND INCLUDES MONEY FOR RUN, ETC.
WE ARE RECOMMENDING HOWEVER, IN THIS BUDGET THAT WE REDUCE OUR 20, $20,000 CONTRIBUTION TO THAT EVENT TO $10,000 BECAUSE OF THE RECENT TURNOUT AND THEY HAVE SOME PARTNERSHIP OPPORTUNITIES THAT MAY, UH, LA, THE CITY OF IT'S, IT'S NEAT TO HELP FACILITATE THAT PROJECT.
UM, LASTLY, WE THINK THAT THIS BUDGET REFLECTS SOME INNOVATIVE IDEAS.
WE CONTINUE TO EXPLORE ADVANCED PURE WATER WITH PADRE DAM AND WITH THE COUNTY OF SAN DIEGO HELIX WATER DISTRICT.
AGAIN, AS I MENTIONED BEFORE, IT'S GOING TO TAKE ADVANTAGE OF THE OPPORTUNITIES ZONES THAT WE HAVE IN THE CITY TO ATTRACT, UM, INCREASED DEVELOPMENT OPPORTUNITIES IN, UM, FUNDING FOR INVESTMENT IN OUR COMMUNITY.
WE'RE GOING TO CONTINUE TO PUSH, UM, USING, UH, DATA LED POLICING THROUGH OUR SPECIAL ENFORCEMENT UNIT, WHICH FOCUSES A NOT, NOT ON JUST HOMELESS ISSUES, BUT A LOT OF ISSUES AS JUST TRAFFIC CONTROL AND OTHER THINGS THAT, THAT WE NEED TO, UH, IMPROVE THE QUALITY OF LIFE IN OUR COMMUNITY AND ADDRESSES HOMELESSNESS.
WE THINK IN A UNIQUE WAY BY INVOLVING DIFFERENT PARTNERS, NOT JUST US PUSHING, UM, ALL THE TIME, BUT, BUT HAVING OUR PARTNERS HELP IN LOOKING AT NEW WAYS OF ADDRESSING HOMELESS ISSUES.
UH, IT ALSO LOOKS AT EXPLORING THIS NEXT YEAR, DIFFERENT WAYS TO DELIVER BASIC MUNICIPAL SERVICES, WHETHER THAT BE THROUGH, UM, UH, RECONFIGURING STAFFING MODELS OR CONTRACTING OUT CERTAIN COMPONENTS OF WHAT THE CITY DOES.
AND THEN WE'RE ALSO EXPLORING SOME ENERGY EFFICIENCIES INVESTING.
SOME OF THE, THAT WE HAVE TO GENERATE ADDITIONAL REVENUE OR TO, UM, GENERATE ONGOING COST SAVINGS.
SO THOSE ARE SOME THINGS THAT YOU'LL SEE IN TERMS OF INNOVATION THROUGHOUT THE BUDGET.
IN CONCLUSION, UM, WE'LL GO TO THE NEXT SLIDE.
UM, I JUST WANTED TO THANK, UM, THE CITY COUNCIL FOR THE DIRECTION THAT IT'S PROVIDED OVER THE YEARS IN, IN ENCOURAGING STAFF TO LOOK FOR INNOVATIVE SOLUTIONS TO MUNICIPALS, UM, PROJECTS.
I APPRECIATE THAT THE COUNCIL WANTS TO TAKE A CONSERVATIVE APPROACH TO HOW YOU ALLOCATE RESOURCES.
AND I WANTED TO THANK UH, THE MANY MEMBERS OF STAFF, THE FINANCE, UH, DEPARTMENT IN PARTICULAR THAT HAS LED THE CHARGE IN PUTTING THIS DOCUMENT TOGETHER.
W WE WORK ON IT THROUGHOUT THE YEAR, BUT IT SORT OF SEEMS LIKE THE LAST MONTH BEFORE THIS MEETING IS THERE'S A LOT OF EFFORT THAT GOES INTO IT AND, AND UM, THERE A LOT OF BODIES LOOKING AT IT AND CRUNCHING NUMBERS AND I'M EXPLORING LOTS OF DIFFERENT OPTIONS.
I WANT TO THANK THEM AND FOR THEIR PROFESSIONALISM WITHOUT A CONCERN.
THE REST OF THE TIME OVER TO OUR FINANCE DIRECTOR, CLAY,
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SHANE TO GO OVER THROUGH SOME UH, DETAILS.GOOD AFTERNOON, HONORABLE MAYOR, DISTINGUISHED MEMBERS OF THE CITY COUNCIL, MEMBERS OF THE PUBLIC AND CITY STAFF TODAY.
GRAHAM KIND OF HIT ON THIS A LITTLE BIT.
WE'LL GO THROUGH THIS PRETTY QUICKLY, BUT THE POINT OF TODAY'S SPECIAL PRESENTATION IS TO BRIEF THE CITY COUNCIL AND THE PUBLIC ON OUR PRELIMINARY BUDGET DOCUMENT.
WE WILL RETURN ON JUNE 25TH AT THE REGULARLY SCHEDULED CITY COUNCIL MEETING TO CONDUCT OUR PUBLIC HEARINGS AND HOPEFULLY FINALIZE AND ADOPT THE ANNUAL BUDGET.
YEAH, THE BUDGET DOCUMENT ITSELF IS AVAILABLE ELECTRONICALLY ON THE CITY'S WEBSITE, WHICH IS CITY OF EL CAHONE DOT.
U S AS WELL AS A HARD COPY ON THE FRONT COUNTERS OF THE CITY CLERK'S OFFICE AS WELL AS THE FINANCE DEPARTMENT.
THE REMAINDER OF THE PRESENTATION WE WILL COVER THE FOLLOWING POINTS.
WE WILL TOUCH BRIEFLY ON THE STATUS OF THE ECONOMY.
TALK ABOUT CALPERS FOR A MOMENT, GIVE A BRIEF OVERVIEW OF THE BUDGET IN ITS ENTIRETY AS WELL AS SPEND A LITTLE BIT OF TIME DISCUSSING THE GENERAL FUND, THE WASTEWATER FUND, AND THEN SUMMARIZE SOME OF THE CITY'S OTHER SPECIAL REVENUE FUNDS AS WELL AS THE CAPITAL IMPROVEMENT PROGRAM.
I THINK MR. MITCHELL SUMMED IT UP PRETTY WELL RIGHT NOW ON THE STATUS OF THE ECONOMY RIGHT NOW AND MAKE SURE WE TALKED ABOUT IT JUST A FEW MONTHS AGO WHEN WE WERE UP FOR THE MIDYEAR REPORT.
A LOT OF CONFLICTING SIGNALS RIGHT NOW FROM ECONOMISTS.
UM, SOME ARE SAYING THE SKY IS FALLING, SOME ARE SAYING THAT IT'S A BRIGHT SUNNY SKIES OUTSIDE.
UM, RECENT GDP NUMBERS FOR THE FIRST QUARTER OF 2019 WE'RE VERY OPTIMISTIC, CAME IN STRONGER THAN ANTICIPATED, ALTHOUGH A LOT OF PEOPLE ARE EXPECTING THAT TO SOFTEN THROUGHOUT THE REMAINDER OF THE FISCAL OR CALENDAR YEAR.
THE UNEMPLOYMENT RATE AS OF APRIL, 2019 DROPPED TO 3.6% NATIONALLY.
I SAW A STATISTIC LISTED THAT THAT'S THE LOWEST IT'S BEEN SINCE 1969.
THE S AND P K SCHILLER PRICE INDEX FOR BOTH THE 20 CITY COMPOSITE INDEX AND THE SAN DIEGO MARKET BOTH INDICATE THAT HOME PRICES CONTINUE TO INCREASE, ALTHOUGH IT IS AT A SLOWER RATE THAN IT HAS BEEN IN PREVIOUS YEARS.
HOUSING STARTS UNFORTUNATELY ARE DOWN.
SO WE DO INDEED HAVE A NUMBER OF MIXED SIGNALS AND WE'RE APPROACHING THINGS CAUTIOUSLY.
CAN'T REALLY GET ME UP HERE WITHOUT TALKING ABOUT CALPERS VERY MUCH.
UM, CALPERS CONTRIBUTIONS OVER THE NEXT FEW YEARS, UH, FOR BOTH OF OUR PLANS ARE MISCELLANEOUS PLAN AND OUR SAFETY PLAN ARE COMBINED HERE.
UM, WE'RE LOOKING AT PRETTY STEEP INCREASES, BUT AS MR. MITCHELL INDICATED, IT DOES START TO TAPER OFF AND IT DOES SEEM LIKE WE GET A LITTLE BIT OF BREAK IN 2025.
HOWEVER, DEALING WITH CALPERS LONG ENOUGH, YOU KINDA ARE JUST WAITING FOR THE NEXT SHOE TO DROP.
UM, SO WE'LL WAIT TO SEE HOW THEIR, UH, THEIR MORTALITY STUDIES AND EXPERIENCE STUDIES TURN TURNOUT HERE IN THE NEXT YEAR OR TWO.
AS AN OVERVIEW OF THE PRELIMINARY BUDGET.
THIS IS A TOTAL, A SPENDING PLAN OF APPROXIMATELY $186 MILLION OF THAT LITTLE LESS THAN HALF OF IT, 42% OR $78 MILLION IS THE GENERAL FUND REPRESENTED BY THE BIG DARK BLUE BLOCK.
ALSO, AS MR. MITCHELL INDICATED, A SIGNIFICANT AMOUNT OF MONEY IS ALLOCATED FOR MAINTAINING AND DEVELOPING THE CITY'S INFRASTRUCTURE.
APPROXIMATELY 54 POINT $6 MILLION IS APPROPRIATED FOR THE CAPITAL PROJECT FUNDS.
AFTER THAT WASTEWATER IS APPROXIMATELY 15.7% OF THE BUDGET, JUST SHY OF $30 MILLION AND EVERY OTHER CITY OR UH, BUDGET IN THE CITY OF ACCOUNTING FOR APPROXIMATELY 13% OF THE PLAN.
MOVING TO THE GENERAL FUND BEFORE WE GET INTO NEXT YEAR, WANTED TO BRIEFLY CATCH US UP ON WHERE WE'RE THINKING, WHERE WE THINK WE'RE GOING FOR THE CURRENT YEAR, FISCAL YEAR 19 WE'RE EXPECTING REVENUES TO FINISH THE YEAR TOTALING APPROXIMATELY 75 POINT $4 MILLION.
THIS IS JUST SHY OF 1% OF OVER BEING OVER BUDGET AND A VERY MODEST 1.7% INCREASE OVER THE PREVIOUS FISCAL YEAR.
FYA 18 EXPENDITURES ON THE OTHER HAND ARE EXPECTED TO TOTAL 78 POINT $3 MILLION.
THIS IS 1.8 MILLION UNDER BUDGET AND THAT APPEARS TO BE 16.2% ABOVE WHAT WE EXPENDED IN FYA 18.
BUT IT'S IMPORTANT TO REMEMBER THAT AS PART OF THAT 78.3 WE HAD APPROXIMATELY $5 MILLION OF FUNDS FROM THE SALE OF THE A HUNDRED FLETCHER OF THE OLD POLICE STATION BEING TRANSFERRED TO THE CIP PROGRAM TO SUPPORT THE MAGNOLIA PERFORMING ARTS CENTER RENOVATIONS.
ONCE YOU ADJUST FOR UM, NINETEENS EXPENDITURES ARE UP FROM THE PREVIOUS YEAR BY ABOUT 8% AND MOST OF THAT IS FROM FILLING VACANCIES AND GETTING BACK UP TO SPEED, PLAYING A LITTLE
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CATCH UP ON SOME THINGS TAKEN ALTOGETHER.WE'RE ANTICIPATING FUND BALANCE TO D DECREASE THIS YEAR BY APPROXIMATELY TWO POINT $9 MILLION.
AND TYPICALLY THAT'S BAD NEWS.
HOWEVER, WITH THAT TRANSFER OF FUNDING TO CIP FOR MAGNOLIA PERFORMING ARTS CENTER, UM, WE WERE ANTICIPATING A FIVE POINT $3 MILLION INCREASE.
SO WHEN YOU LOOK AT IT AND KEEPING THAT IN MIND, WE'RE ABOUT TWO POINT $4 MILLION BETTER OFF THAN WE INITIALLY PLANNED.
LOOKING FORWARD TO NEXT YEAR
THIS IS A 2.4% INCREASE FROM THIS CURRENT FISCAL YEAR
SALES AND PROPERTY TAXES TOGETHER.
ACCOUNT FOR ABOUT THREE QUARTERS OF THE GENERAL FUNDS BUDGET WITH ALL REMAINING OTHER CATEGORIES, ADDING UP TO THE REMAINING QUARTER EXPRESSED THIS WAY.
THE BIG BLUE WEDGE IS SALES TAX AND I THINK THIS UNDERLINES THE IMPORTANCE OF THAT CATEGORY.
PROPERTY TAX SPRINGS UP ANOTHER QUARTER PERCENT.
SO 75% THREE QUARTERS OF THE CITY'S REVENUE SOURCES, THE GENERAL FUND REVENUE SOURCES ARE THOSE TWO CATEGORIES ALONE.
UM, AND THIS DOCUMENT IS FULL OF THEM.
UM, I DON'T WANT TO NECESSARILY READ THIS TABLE TO YOU.
I HAVE IT UP HERE JUST FOR A MOMENT.
UH, MAINLY TO EXPRESS ONE THING, THE 2.4% REVENUE GROWTH WE'RE ANTICIPATING FOR NEXT YEAR.
THERE REALLY ISN'T ONE BIG STORY TO TELL.
THERE ISN'T ONE CATEGORY THAT'S NAILING IT.
UH, YOU KNOW, HITTING IT OUT OF THE PARK.
MOST OF THAT INCREASE IS SPREAD THROUGHOUT REVENUE CATEGORIES, UM, OR THEY'RE REMAINING RELATIVELY FLAT ON THE EXPENDITURE SIDE.
WHEN WE LOOK AT THE GENERAL FUND BUDGET BY CATEGORY, WE SEE A LITTLE BIT OF WHAT MR. MITCHELL EXPRESSED IN STAFFING.
UM, GROW IS WHERE MOST OF THE GROWTH IS.
UM, IT'S APPROXIMATELY THREE POINT $7 MILLION.
UM, FOR THE MOST PART THAT'S CALPERS INCREASES, ALTHOUGH ANY SALARY AND BENEFIT INCREASES ARE INCLUDED, THEIR RESULTS AS WELL AS ALSO EXPRESSED EARLIER, THE SUPPLIES AND SERVICES ARE RELATIVELY FLAT FROM YEAR TO YEAR.
AND HERE AGAIN AT THE BOTTOM THERE ON FYA 19, WE SEE THE TRANSFER FOR MAG PACK, UH, SORRY, THE MAGNOLIA PERFORMING ARTS CENTER OF APPROXIMATELY $5 MILLION.
I WAS REALLY INTO PIE CHARTS YESTERDAY.
I WAS PUTTING THE SLIDE DECK TOGETHER.
THIS IS STILL GENERAL FUND EXPENDITURES BY CATEGORY AND I WANTED TO INCLUDE THIS TO GRAPHICALLY DEMONSTRATE THE IMPORTANCE OF PERSONNEL COSTS IN THIS BUDGET.
THESE ARE FOR THE INDIVIDUALS THAT ARE DELIVERING THE SERVICES TO THE PUBLIC.
IT'S THE BIGGEST COMPONENT OF THE BUDGET WITH MATERIALS, SUPPLIES AND SERVICES, ACCOUNTING FOR THE REMAINING QUARTER.
ON THIS TABLE WE SEE THE FUNCTIONS IN THE GENERAL FUND.
HERE AGAIN, GENERAL GOVERNMENT, WE SEE AN INCREASE.
MOST OF THAT'S ACCOUNTABLE, UH, WITH THE ECONOMIC DEVELOPMENT ACTIONS THAT THE CITY MANAGER DESCRIBED EARLIER.
WE SEE SIGNIFICANT INCREASES IN BOTH POLICE AND FIRE AS WE'VE ADDRESSED SOME OF THOSE ISSUES THAT HAVE ALSO BEEN DISCUSSED.
AND THE REMAINDER OF THE GENERAL FUNDS RELATIVELY FLAT HERE AGAIN WITH ANOTHER PIE CHART, UM, WE SEE POLICE DEMONSTRATED BY THE BIG BLUE WEDGE APPROXIMATELY 48% OF THE GENERAL FUND BUDGET WITH FIRE.
THE RED WEDGE OF APPROXIMATELY 22%.
I INCLUDED THIS HERE JUST TO DRIVE HOME THE POINT THAT OF OF THE ENTIRE BUDGET, THE ENTIRE GENERAL FUND BUDGET, APPROXIMATELY 70% OF IT IS DEDICATED TOWARDS PUBLIC SAFETY.
AS I WAS PUTTING THIS TOGETHER, I HAD A LITTLE BIT OF A CURIOSITY.
EVERYONE'S AFFECTED BY CALPERS COST.
I KNOW THIS IS GOING BACK A LITTLE BIT TO SOMETHING WE'VE ALREADY COVERED, BUT I WONDERED WHAT THIS WOULD LOOK LIKE IF WE PULLED THE CALPERS EXPENDITURES OUT OF EACH DEPARTMENT AND SET IT UP AS ITS OWN WEDGE AS IF IT WAS A ZONE DEPARTMENT TO SEE WHAT THAT WOULD LOOK LIKE.
AND THAT'S THE BRIGHT RED WEDGE THAT'S KIND OF PULLED OUT OF THE PIE.
IF WE CONSIDERED CALPERS ITS OWN DEPARTMENT, IT WOULD BE THE SECOND BIGGEST DEPARTMENT IN THE GENERAL FUND WITH ONLY POLICE BEING LARGER.
TO SUMMARIZE THIS ACTIVITY, WE'RE GONNA KIND OF PULL THE CURRENT FISCAL YEAR END NEXT YEAR.
TOGETHER WE STARTED FYA 19 WITH APPROXIMATELY $49 MILLION
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IN RESERVE RESERVES.UM, WITH OUR PROJECTED REVENUES IS 75.4 AND EXPENDITURES OF APPROXIMATELY 78.3 WE EXPECT TO END THIS YEAR AT 45.7 MILLION IN RESERVES.
THE PROPOSED BUDGET PROJECTED REVENUES OF 77.2 NEXT YEAR AND EXPENDITURES OF ABOUT 78.1 MILLION AND WE EXPECT TO END WITH A TOTAL FUND BALANCE IN THE GENERAL FUND OF ABOUT 44 POINT $9 MILLION.
WHEN YOU LOOK A LITTLE CLOSER AT THAT 44.9 MILLION, IT BREAKS DOWN INTO THESE FOUR RESERVE CATEGORIES.
THE FIRST ONE BEING THE 20% OPERATING RESERVE.
AS MR. MITCHELL EXPLAINED EARLIER, WE HAVE NOT.
WE'VE BEEN ABLE TO MAINTAIN THAT INTO NEXT YEAR.
WE ALSO HAVE ADDITIONAL FUNDING IN THE CARRYOVER RESERVE.
WE DO REQUIRE A LITTLE BIT OF USE OF THE PPARS RESERVE, WHICH IS WHY WE SEE THAT BALANCE MOVING DOWN A LITTLE BIT FROM 8 MILLION AND WE'RE STILL ABLE TO MAINTAIN THE DESIGNATED FOR ECONOMIC UNCERTAINTY RESERVE AS WELL.
CHANGING OUR FOCUS NOW TO THE WASTEWATER FUND, WE ANTICIPATE STARTING NEXT FISCAL YEAR WITH APPROXIMATELY 13 POINT $7 MILLION IN BUDGETARY FUND BALANCE.
WE ANTICIPATE COLLECTING AN ADDITIONAL 20 POINT $5 MILLION IN REVENUES AND EXPECT EXPENDITURES TO TOTAL APPROXIMATELY 22.4 MILLION WITH CAPITAL AND OTHER FINANCING USES OF 6.8 LEAVING US WITH A PROJECTED ENDING BUDGETARY FUND BALANCE OF APPROXIMATELY FOUR POINT $9 MILLION.
THIS SLIDE SUMMARIZES OUR TOP FIVE SPECIAL REVENUE FUNDS.
THESE ARE FUNDS THAT HAVE SEPARATE AND DISTINCT REVENUE SOURCE THAT ARE RESTRICTED FOR A SPECIFIC PURPOSE.
NEXT YEAR, THE LARGEST OF WHICH WILL BE THE STREET MAINTENANCE OR THE GAS TAX FUND OF APPROXIMATELY 3.2 MILLION, THE LOW AND MODERATE INCOME HOUSING FUND TO FUND HOUSING PROGRAMS OF APPROXIMATELY JUST SHY OF $3 MILLION CDBG AND WANTING TO POINT OUT THAT THAT IS NEW APPROPRIATIONS AND NOT ANY CARRYOVER MONIES.
UM, POLLING APPROXIMATELY 1.3 MILLION RECREATION SPECIAL PROGRAMS, APPROXIMATELY 700,000 AND THE FEDERAL, STATE AND LOCAL GRANTS TOTALING APPROXIMATELY $660,000.
THE CITY OPERATES A NUMBER OF INTERNAL SERVICE FUNDS.
THESE ARE FUNDS THAT ARE FUNDED BY FEES CHARGED INTERNAL CUSTOMERS.
THESE ARE FUNDS THAT SERVICE OTHER FUNDS IN THE CITY.
THE BIGGEST OF WHICH IS OUR IT SERVICES FUND AT THREE POINT $9 MILLION.
OUR WORKERS' COMPENSATION INSURANCE FUND OF APPROXIMATELY 2.4 MILLION THAT'S BEEN SEGREGATED FOR THE FIRST TIME THIS FISCAL YEAR AND IT WILL BE DISCUSSED A LITTLE BIT LATER TODAY.
UH, THE VEHICLE MAINTENANCE FUND OR FLEET FUND OF APPROXIMATELY TWO POINT $4 MILLION.
OUR CLAIMS FUND, OUR SELF INSURANCE FUND IS ABOUT 2.1 MILLION.
AND OUR POST EMPLOYMENT BENEFITS TOTAL IS APPROXIMATELY 1.3 MILLION.
CAPITAL IMPROVEMENT PROGRAM HAS GOTTEN FAIRLY LARGE THIS YEAR, UH, TOTALING APPROXIMATELY $39 MILLION.
AND MOST OF IT, AS YOU CAN SEE, IS ON THAT VERY FIRST LINE IS TRANSPORTATION PROJECTS.
THESE ARE OUR GATEWAYS TO THE CITY.
UM, APPROXIMATELY, WELL, A LITTLE MORE THAN HALF OF THE TOTAL CIP BUDGET ARE FOR THESE NEEDS.
WASTEWATER PROJECTS TOTAL ABOUT 6.6 MILLION, A LITTLE LESS GLAMOROUS SPENDING THERE.
UM, FACILITIES FOR THE MOST PART, THAT'S A MAGNOLIA PERFORMING ARTS CENTER.
UH, 4.2 MILLION PUBLIC SAFETY, 3.8 MILLION AND PARK PROJECTS APPROXIMATELY 1.5 MILLION.
LOOKING AT THE PROGRAM AND A SLIGHTLY DIFFERENT WAY, THIS SLIDE LISTS OUR 10 LARGEST CITY PROJECTS, UM, LARGEST OF WHICH IS, UH, ENERGY EFFICIENCIES FOR THE PUBLIC SAFETY, UH, FACILITIES, UM, LOOKING TO REDUCE OPERATING COSTS AS WELL AS DEVELOP A LITTLE BIT OF ENERGY INDEPENDENCE.
IT'S ABOUT THREE POINT $4 MILLION.
PROBABLY DON'T NEED TO GO THROUGH THIS AND READ THEM ALL TO YOU WERE THERE IN OUR DOCUMENT.
THE ONE THING THAT'S IMPORTANT TO SEE HERE, JUST TO SCAN THROUGH THEM REAL QUICKLY, YOU CAN REALLY SEE THE, THE, THE ATTENTION SPENT ON TRANSPORTATION PROJECTS HERE.
MAJORITY OF THESE ARE STREETS, ROADS, THINGS LIKE THAT.
UM, ONE OTHER THING THAT CAME TO MIND AS I WAS PUTTING THIS SLIDE TOGETHER.
UM, THIS IS A LIST OF NEW PROJECTS AND OLD PROJECTS.
UM, IT OCCURRED TO ME WHEN I WAS KEYING IN THE OVERLAY 2019 LINE.
UM, I KNOW THERE'S BEEN SOME CONFUSION WITH SOME IN THE PAST THAT HAVE ASSUMED THAT THIS IS NEW
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MONEY.THIS IS A CONTINUATION OF PREVIOUSLY APPROPRIATED MONEY.
THIS IS JUST A RENEWING BY THE CITY COUNCIL OF THIS PROJECT.
SO THINGS LIKE THE OVERLAY 2019, THE MAGNOLIA PERFORMING ARTS IMPROVEMENTS, THOSE ARE THE CONTINUATION OF EXISTING PROJECTS AND NOT NEW MONIES.
AS I SAID, THESE ARE THE TOP 10 PROJECTS.
UM, ALL REMAINING PROJECTS, WHICH THERE ARE 40 OF THEM TOTAL, 11.7 AND BRINGS US BACK TO THE TOTAL CIP PROGRAM OF $39 MILLION.
WITH THAT, THAT CONCLUDES MY PRESENTATION.
I'D BE HAPPY TO ANSWER ANY QUESTIONS IF YOU HAVE THEM.
THANKS VERY A COMPREHENSIVE REPORT.
ANY QUESTIONS? STEVE? HI CLAY.
UH, BESIDES THE CAPITAL IMPROVEMENTS TO MAGNOLIA PERFORMING ARTS CENTER, WHAT'S IN THE BUDGET FOR OPERATIONAL EXPENSES FOR THE COMING YEAR? WE DO HAVE A SEPARATE FUND SET UP SPECIFICALLY TO SEGREGATE THE COSTS OF OPERATING THE MAGNOLIA PERFORMING ARTS CENTER.
UM, WE'VE ESTABLISHED A BUDGET THAT SIMPLY I BEST, I THINK THE BEST WAY TO DESCRIBE IT AS A PLACE HOLDER.
IT'S ENOUGH TO GET OFF THE GROUND AND GET MOVING.
UM, ONCE WE GET A LITTLE BIT FURTHER IN TO OPENING THE CENTER, I, I HOPE WE HAVE A LITTLE BIT BETTER INFORMATION AND CAN AT THAT TIME WE'RE TURN TO THE CITY COUNCIL AND MAYBE GET A MORE COMPLETE BUDGET.
BUT WE BELIEVE WE HAVE ENOUGH TO OPEN THE DOORS RIGHT NOW.
HOW ABOUT FOR, TO OPERATE FOR A FULL YEAR BECAUSE THE BUDGETS FOR A FULL YEAR.
SO WE KNOW HOW MUCH IT'LL COST TO OPERATE THE DAY TO DAY OPERATIONS OF THE BUDGET.
I MEAN THE THE CENTER CAUSE WE HAVE AN AGREEMENT WITH, WITH LIVE NATION, WHAT WE DON'T KNOW IS WILL IT COST US $20 MILLION IN COSTS AND THEN WE'RE GOING TO GET $20 MILLION BACK IN REVENUE THAT WE DON'T KNOW.
SO WE HAVE THE FUNDING TO OPEN AND OPERATE BUT WE JUST DON'T KNOW HOW MUCH IT'S GOING TO COST AS MONEY IT LEAVES AND COMES BACK IN.
HAVE YOU RESERVED AN AMOUNT FOR UTILITIES AND AIR CONDITIONING AND ONGOING EXPENSES OR IS THAT GOING TO BE A SURPRISE WHEN THAT HITS THE BUDGET? I WOULD NOT SAY THAT IT WOULD BE A SURPRISE.
UM, I THINK THERE'S ENOUGH ASSUMPTIONS TO BE MADE ABOUT NUMBERS OF SHOWS AND THINGS TIED TO THAT.
HOW MANY MONTHS WE'RE GOING TO BE OPERATING THAT SIMPLY AREN'T KNOWN QUITE YET.
I THINK THEY'RE SUFFICIENT TO HAVE THE LIGHTS ON OPERATING THE OFFICES ON DAY TO DAY FOR THE YEAR.
BUT I THINK ONCE WE START GETTING SOME SHOW PLANNING AND THINGS LIKE THAT, THEN WE CAN START GOING A LITTLE BIT FURTHER WITH THE PLANNING.
I GUESS I WANT TO AT LEAST RAISE THE CONCERN.
WE DON'T WANT TO BE HIT WITH A HALF A MILLION DOLLAR SURPRISE AT THE END OF THE FISCAL YEAR SAYING, WOW, THAT WE JUST DIDN'T SEE THAT ONE COMING.
SO THAT'S MY CONCERN THAT WE DON'T, THAT WE RESERVE FOR THAT AND NOT GET SURPRISED BY IT.
WELL I THINK A LOT OF THAT COMES DOWN TO ONCE WE START SEEING NUMBER OF SHOWS THAT ARE BOOKED AND WE HAVE PROFORMA INFORMATION PROVIDED BY LIVE NATION, I THINK WE'D HAVE A LITTLE BIT MORE OF AN INFORMED DECISION AT THAT POINT.
BUT A LOT OF THAT OPERATING EXPENSES IS DRIVEN BY THE NUMBER OF SHOWS, THE TYPES OF SHOWS, THINGS LIKE THAT AND HOW LONG THE CENTER WILL BE OPEN.
YOU KNOW, THERE'S A SIGNIFICANT DIFFERENCE IN OPENING JULY 1ST AND OPENING JANUARY 1ST.
SO I THINK WE'RE JUST WAITING TO SEE A LITTLE BIT.
UH, YOU KNOW, WE DON'T WANT TO JUMP THE GUN AND, AND USE BAD INFORMATION.
I THINK WE'RE WAITING FOR BETTER INFORMATION BEFORE WE DO THAT KIND OF PROGRAMMING.
THE 2.4 MILLION IN WORKER'S COMP IS THAT OUR RESERVES A REQUESTED BY AN ACTUARY FOR POTENTIAL CLAIMS. THAT IS A COMBINATION OF THE PREMIUM PAYMENT FOR EXCESS WORKERS' COMP INSURANCE.
UM, OUR ESTIMATED COST OF CLAIMS AS WELL AS A LITTLE BIT TO BEGIN ESTABLISHING THE NECESSARY RESERVE FOR THAT PURPOSE.
DO YOU THINK EVEN AFTER ALL OF THESE CAPITAL EXPENDITURES, WE HAVE ANY DEFERRED MAINTENANCE EXPENSES LEFT THAT WE NEED TO ADDRESS SUCH AS FLEET MAINTENANCE OR BUILDING OR ROAD MAINTENANCE AND DEFERRED EXPENSES? WE SHOULD BE AWARE OF? I DON'T KNOW IF I'M NECESSARILY THE BEST PERSON TO ANSWER THAT QUESTION.
I CAN SAY THAT I'M NOT AWARE OF ANY BACKLOG THAT A LOT OF OTHER CITIES HAVE SUFFERED FROM.
UM, YOU KNOW, THERE'S ALWAYS WORK THAT GETS PUSHED TO THE NEXT YEAR FOR ONE REASON OR ANOTHER, WHETHER IT BE MANPOWER WAITING FOR FUNDING, LIKE A GRANT TO COME IN OR SOMETHING LIKE THAT.
BUT I'M NOT AWARE OF ANY BIG BACKLOG, A HUGE, UH, UNRECOGNIZED LIABILITY AND DEFERRED COMPENSATION COUNSELING.
OTHER QUESTIONS? BOB? I WAS CURIOUS.
UH, I SAW AN ITEM IN THERE ON
WHAT PORTION OF HAMARTIA ROAD ARE WE TALKING ABOUT? UM, OKAY.
[00:30:01]
TRIED TO CALL THAT PUBLIC WORKS DIRECTOR TO COME UP.HE, HE'S KEENLY AWARE OF THAT PROJECT.
I TRAVEL THAT NOW AND THEN, AND I KNOW BETWEEN WASHINGTON AND UH, UH, MAIN, IT'S NOT THE SMOOTHEST ROAD IN THE WORLD.
WELL YOU HIT IT RIGHT ON THE HEAD THERE.
UH, IT'S APPROXIMATELY FROM, UH, UH, SOUTH OF WASHINGTON, UH, AREA ALL THE WAY NORTH PAST THE, UH, I ATE INTO SECOND STREET.
SO THERE THERE'S, THERE'S UH, SEVERAL DIFFERENT, UH, ITEMS THAT WE'RE LOOKING AT MOSTLY RELATED TO PEDESTRIAN SAFETY, UH, DUE TO INCIDENTS THAT HAVE OCCURRED IN THE PAST FEW YEARS.
IT'S A HIGHWAY SAFETY IMPROVEMENT PROGRAM GRANT THAT WE SEE AND IT'S ACTUALLY ONE THAT WILL HELP TO IMPROVE A LOT OF THINGS, BUT ALSO AT THE SAME TIME WE GET TO IMPROVE A LOT OF INFRASTRUCTURE WITH IT.
AND THAT GOES RIGHT DOWN TO HIGH PASS HIGHWAY DOWN SECOND STREET YOU SAID? YEAH, CAUSE THERE WAS A HIGH, UM, NUMBER OF INCIDENTS JUST NORTH THERE.
AND SO WE'RE GOING TO LOOK AT PROVIDING A SAFER CROSSING OF THE STREET.
OH, MR. MITCHELL, COULD YOU GIVE ME SOME EXAMPLES OF THE POST EMPLOYMENT BENEFITS THAT WE'LL BE PAYING FOR? OKAY.
I ACTUALLY, I'M GONNA, I'M GONNA BRING MR SHANE UP TO EXPLAIN THAT PROGRAM.
UM, THERE ARE, UH, ONE IS THE, UH, PIMP CTCA, UH, HEALTH INSURANCE FOR RETIREES.
UM, WE PROVIDE APPROXIMATELY $125, IF MY MEMORY SERVES CORRECTLY, UH, PER MONTH, UH, FOR RETIREES, UM, ADULT.
ADDITIONALLY, THERE'S ANY PAYMENTS THAT ARE MADE FOR PRESERVATION OF BENEFITS FOR PEOPLE WHOSE PENSIONS HAVE FALLEN OUTSIDE THE MAXIMUM PERMITTED BY THE IRS AND CALPERS.
SO IT'S, IT'S A HANDFUL OF RELATIVELY SMALL ITEMS. RIGHT.
LET'S TO FOLLOW UP FROM HIS DROP PERSON.
UH, WE'RE PRETTY PROUD OF YOUR EFFORTS.
THE CITY STAFF'S EFFORTS IN PAVEMENT CONDITION INDEX, PCI, ALCOHOL, AND HAS ONE OF THE BETTER ONES AROUND THE COUNTY.
ARE WE MAINTAINING THAT WITH THIS BUDGET? ABSOLUTELY.
AND ONE THING THAT WE'RE FOCUSING ON GREATLY IS TO IDENTIFY A ZONE MAINTENANCE THAT REALLY CONCERTS OUR EFFORTS IN DIFFERENT ZONES AROUND THE CITY.
AND SO WHAT WE'VE ESTABLISHED AS A MORE SYSTEMATIC WAY OF MAINTAINING THE CITY'S INFRASTRUCTURE FROM SIDEWALKS TO STREETS TO SEWERS TO WORKING WITH OTHER UTILITIES LIKE HELIX WATER SO THAT WE'RE NOT ALL ON TOP OF EACH OTHER AT THE SAME TIME.
AND SO WE'RE TAKING A SYSTEMATIC APPROACH TO THIS.
THE MONEY THAT WE'RE PUTTING INTO THE PAVEMENT TO PRESERVE IT, BOTH IN OVERLAYS AND SLURRY SEALS WILL REALLY HELP.
UM, THIS AND A LOT OF IT IS ATTRIBUTED TO THE SB ONE FUNDS THAT WE'RE RECEIVING.
UM, A LOT, A LOT OF PEOPLE, THEY COME TO YOU, THEY SAY YOU'RE A PUBLIC WORKS EMPLOYEE AND WHY ARE WE HAVING TO PAY MORE AT THE PUMP? WHERE'S THIS MONEY GOING? WHO SIPHON IT OFF? AND I WANT THE RESIDENTS OF EL HOME TO KNOW THAT IT'S GOING DIRECTLY TO THE STREETS.
WE'RE TAKING ALL THAT MONEY, NOBODY'S SIPHONING OFF THE TOP AND WE'RE APPLYING THAT TO WHILE WE GET IT, AS IT WERE, WE'RE PUTTING IT RIGHT DOWN ON THE STREETS AND WE'RE GOING, WE'RE GOING TO SEE A LOT OF FUTURE IMPROVEMENTS.
ONE OF THE WORST STREETS THAT WE HAD IN THE CITY RIGHT NOW, NORTH JOHNSON.
UM, WE JUST GROUNDED YESTERDAY AND TOMORROW WE'RE GOING TO BE PAVING IT.
AND IT WASN'T THAT ABOUT A MILLION AND A HALF THIS YEAR.
AND SB ONE MONEY, UH, PROBABLY A LITTLE BIT MORE IF I, IF I REMEMBER CORRECTLY.
SO THAT ALLOWS US TO USE A MILLION AND A HALF OF GENERAL FUND MONEY, WHICH PREVIOUSLY PAID FOR THOSE THINGS IN OTHER AREAS, RETENTION OF THAT AND TRANSNET MONEY THAT WE RECEIVE, WE'RE ABLE TO ALLOCATE THOSE MONIES TO OTHER AREAS THAT NEED IT EVEN MORE SO.
AND SO WE'RE TAKING THAT ADDITION, THOSE ADDITIONAL FUNDS FROM SB ONE, APPLYING IT DIRECTLY TO THE STREETS.
WE'RE, WE'RE APPROACHING A TIPPING POINT ON WHETHER WE JUMP INTO THIS THING WITH SOME BIG MONEY, IS THAT IN THIS BUDGET, UM, THAT IS, THAT IS COMPLEX AND CONTEMPLATED IN THE BUDGET.
SO WITH THE COUNCIL WE'LL BE SEEING, UM, IN THE NEXT MONTH ACTUALLY IS A DECISION POINT OF WHETHER WE WANT TO INVEST REAL MONEY BEFORE WE'VE BEEN, WE'VE BEEN PUTTING MONEY INTO EXPLORE.
THIS IS MONEY TO ACTUALLY START DESIGNING AND CONSTRUCTING THAT WOULD BE PAID FOR.
IT WOULDN'T BE PAID FOR OUT OF OUR MONEY.
IT WOULD BE PAID FOR OUT OF UM, GRANT MONEY.
BUT IF THE PROJECT DOESN'T COME FORWARD, WE'D BE ON THE HOOK FOR THAT.
SO THERE'S NOT A LINE ALLOCATED FOR THAT.
BUT IT DOES CONTEMPLATE THAT AS PART OF OUR BIGGER SEWER RATE STUDY THAT YOU'LL BE LOOKING AT AS WELL.
[00:35:01]
WITH REGARD TO CALPERS CONTRIBUTIONS.UM, IS THIS, UH, THE FIXED SCHEDULE OF PAYMENT IF WE PAY AHEAD OF SCHEDULE, DO WE SAVE, DOES THE CITY SAVE ANY MONEY BASICALLY? IS THERE ANY FINANCIAL BENEFITS PAYING AHEAD OF SCHEDULE? YES AND NO.
I MEAN, WHEN, WHEN YOU PAY DOWN A MORTGAGE FOR EXAMPLE, YOU CAN SEE A PRETTY CLEAR RETURN ON WHAT THAT ADDITIONAL PAYMENT WILL WE'LL MAKE.
UH, WE'VE, WE'VE EXPLORED THIS IN A LOT OF DIFFERENT WAYS AND WE LOOKED AT HOW MUCH WOULD WE HAVE TO REALLY PUT INTO A DIFFERENCE.
AND MR SHANE, YOU CAN REMIND ME IT WAS TENS OF MILLIONS OF DOLLARS TO ACTUALLY SHOW A DIFFERENCE.
SO I'M PAYING A MILLION HERE, PAYING A MILLION.
THEY'RE PROBABLY DOESN'T HAVE THE BIGGEST IMPACT THAT, THAT WE WOULD LIKE IT TO HAVE.
UM, SO WE'VE BEEN, THAT'S, WE'VE BEEN RESERVING THAT FUNDS IN CASE OF DAYS LIKE THIS.
THE OTHER THING THAT WE'RE LOOKING AT THOUGH IS CREATING A PROGRAM WHERE WE WOULD PUT THAT THAT SEVEN POINT $2 MILLION OUT OF THE GENERAL FUND ACTUALLY INTO A TRUST FUND THAT WOULD HA WOULD EARN A LITTLE HIGHER INTEREST RATE AND, AND IT WOULD, UM, PUT IT OUT OF TEMPTATION OF USING IT FOR OTHER REASONS.
AND SO WE'RE EXPLORING THAT AS AN OPTION TO BRING THAT TO THE COUNCIL AT SOMETHING.
UM, THE SCHEDULE, CAN THAT BE CHANGED BY CALPERS OR IS THAT A FIXED SCHEDULE? SO CAN THEY UP THE AMOUNTS OVER THE YEARS? CERTAINLY IT DOES CHANGE FROM YEAR TO YEAR.
SO EVERY YEAR WE ACTUALLY GET A PROJECTION FOR THE NEXT SEVERAL YEARS.
AND SO THE NUMBERS THAT MR SHANE SHOWED ARE JUST PROJECTIONS AT THIS POINT.
THEY LOOK AT MORTALITY RATES, THEY LOOK AT, UM, THE CITIES, UM, UH, SALUD PAYROLL, FOR EXAMPLE, THAT THAT'S A FACTOR THAT GOES INTO IT.
BUT THE BIGGEST FACTOR IS THEIR INTERESTS EARNINGS.
AND SO IF THEY'VE MADE AN ASSUMPTION THAT THEY'RE GOING TO GENERATE 6% IN INTEREST AND THEY ONLY GENERATE 4% IN INTEREST, THEN THAT WILL AUTOMATICALLY SHIFT OUR CONTRIBUTION FOR THE NEXT YEAR.
AND THAT'S WHY MR SHANE, HE WAS A LITTLE SKEPTICAL OF US.
HE EVER HITTING THAT POINT WHERE WE'VE PLATEAUED AND ACTUALLY START DECREASING.
WE THINK SOME OF THE, UM, THEIR ASSUMPTIONS ARE PROBABLY FAULTY AND THEY KNOW THEY'RE FAULTY AND THEY'RE JUST WAITING FOR THE RIGHT TIME TO LET US KNOW THEIR FAULTY.
MS. SHANNON, I HAVE A QUESTION FOR YOU.
ASSUMING WE HAD ANOTHER RECESSION LIKE WE DID IN 2008, HOW PREPARED ARE WE FOR THAT? JUST EXPLAIN A LITTLE BIT ABOUT HOW MUCH SAFETY WE WOULD HAVE WITH THE RESERVES THAT WE HAVE AND THE EMERGENCY PLANNING YOU HAVE.
I THINK, I THINK MOST PEOPLE WOULD CONSIDER OUR RESERVES VERY HEALTHY, IN FACT A LOT BETTER THAN MOST OTHER CITIES.
UM, I DON'T KNOW IF YOU WOULD LOOK AT A 2008, 2009 TYPE OF EVENT AS A TYPICAL THING.
UH, WE CERTAINLY HAVE RESERVES TO WEATHER AN AVERAGE RECESSION WHERE WE MIGHT HAVE A SLOW DOWN FOR A COUPLE OF YEARS.
UM, SOMETHING AS DEEP AND AS EXTREME AS 2008, 2009.
UM, WHAT I BELIEVE OUR RESERVES ARE CAPABLE FOR IN THAT SITUATION WOULD BE BUY TO BUY US ENOUGH TIME TO REACT TO IT.
SO RATHER THAN MAKING HUGE, DRACONIAN CHANGES TO A ADAPT TO IT, IT CAN SLOW US DOWN AND GIVE US THE TIME TO MAKE SMART DECISIONS RATHER THAN NATURE DECISIONS.
I CAN'T ANY MORE QUESTIONS OF STAFF? ALL RIGHT.
ANGELA, DO WE HAVE ANY SPEAKER CARDS ON THE SIDE OF WE HAVE NO CARD, SIR.
THE PUBLIC HEARING FOR FISCAL YEAR 2019 TO 2020 BUDGETS WILL BE CONDUCTED ON THE JUNE 25TH, 2019 THREE O'CLOCK MEETING AND WE ARE NOW ADJOURNED.
THE SPECIAL JOINT MEETING OF ELLICOTT CITY COUNCIL HOUSING AUTHORITY OF THE SUCCESSOR AGENCY.
THE ALCOHOL REDEVELOP AGENCY HELD THIS 11TH DAY OF JUNE, 2019 IS ADJOURN AND WE'LL BE BACK AT THREE O'CLOCK FOR THE RED.