Call our fiscal year 27 first budget work session uh to order.

Uh really the only thing that we have on our agenda is this.

So DeCarlin, do you want me to kick it to you first or yes?

I'm gonna kick it to the city manager.

Yes, ma'am.

Thank you.

And I do apologize for the moving in spaces.

The council chambers are actually where ready, but we weren't sure if they were gonna be ready for today.

Okay.

So we thought just to be prepared, we'd we'd move it over to the health department.

But Wednesday and Friday for downtown in council chambers.

Absolutely.

And Christian promised me that everything's ready, right?

Absolutely.

Good to go.

Okay.

Okay.

So we want to take you on a little bit of a journey as we talk about our budget process.

And so one of the things that we're gonna do a little different from last year is we kind of we didn't really get into the proposed budget that we kind of rejected in order to get to the actual budget that we actually sent to the council.

So I want to kind of show you some of the things that department directors asked for that we had to cut in order for us to have a balanced budget.

And remember, our our goal for our budget process is to present a balanced budget to our residents.

And so that's the process that we work through, and that's our ultimate goal.

And so when we when we talk about the budget, I I feel like we're constantly going through a budget process and it never stops.

And I think Matt will agree with me.

Uh so one of the things we do in January is we start off with talking to you guys about what are our goals.

And so what are the goals for the budget?

So that'll help department directors understand what are their what's their ask should be.

And so in January we set what those goals are.

Uh the next step is we talk about new positions.

And so we asked department directors to give us what are the new positions they would like.

And so we'll start we start a process and I meet with every single department director to go over each position that they're requesting.

And some are denied, and some are say, well, we'll say, okay, we'll move it to the next phase.

And then after we talk about positions, then we talk about new decision items.

And that's either equipment, vehicles, or processes or programs.

And we go through all of those.

And again, we set meetings where we go individually and we talk about each new decision item.

And then from there we say, okay, here's what we believe our expenditures will be.

And so that's about a three-month process.

And then in April, we'll we got a better picture of what our revenues should be.

And then we'll have what our forecasts are, and we'll say, okay, here's our revenues.

And then we'll have that conversation of revenues over expenditures.

And then we looked and we said, okay, we need to figure out how do we balance.

Uh this year, when we got through that process, I want to believe that we're a little over seven million dollars out of balance.

Yeah, we were we originally it was around 141 million dollars in expenditures.

And so when we had to get down to 133 for to actually match what our revenues are.

And so that was our goal, and that was the journey we went through.

And I want to thank department directors.

In the past, what we've done is we've sent out a letter or an email to city to all the department directors and say, cut your budget by 5%, cut your budget by 3%, cut your budget by 10%.

We actually had a conversation with department directors, and we all sat around in the room and we talked about priorities.

And we asked, okay, we need to balance.

What can we do without?

And the different department directors said, okay, here's some things that we can put off for a year, or here's some things we could put off for a couple of years.

And we collaboratively got to a point where we actually had a balanced budget.

Uh at some point I did have to send an email and say, okay, we're gonna just cut all service lines by about a half percent.

And so everyone, so all service lines got cut by a half percent.

And so that's kind of a quick snapshot of this journey.

But I do want to say that it is our budget process is a very collaborative process.

We really want to hear from department directors of what their needs are, and so that we can kind of prepare for our future, but also understand the reality of what we can afford and what we can't afford.

This budget does not anticipate the public safety sales tax.

It does not participate any growth in taxes.

Uh there are some service fees that we that we are proposing, and we'll talk about that through this process.

Did I miss anything for the quick intro?

I think just a quick also high level.

So today is discussing general funds.

Yes.

Wednesdays is discussing enterprise funds, so uh transportation and utilities.

Okay, and then Friday's discussion is the holistic all.

But then we'll always we'll also cover special revenue funds if we'll.

Okay.

Just wanted to kind of remind ourselves that.

Yes.

All right.

All right.

Just a quick clarification.

When uh DeCarlin said there's no revenue increases.

We do project slight growth with our sales tax and property tax that we'll go through, but nothing substantially outside the norm.

It's no new.

Yeah, no new, no new revenues, yeah.

All right, all right.

Matthew.

So I did want to make a note that in front of you you have your city council budget and then uh sort of a summary of the general fund.

So uh we'll get a little bit.

I I'll mention the city council budget uh as we get into the presentation a little bit because you all have not had the time a chance to look at this.

So thank you.

This one, I need to click.

There we go.

All right, so here is our discussion points for today.

Uh we're gonna start off looking at the engagements that we've done for the budget.

Uh then we'll go over some general fund narratives and outlook uh where the money comes from.

So basically our revenue projections.

Uh we'll go over the license and fee studies we've uh done this year.

Uh go through some of the internal fee methodologies, and then where the money goes or our expenditures for fiscal year 27.

So this fiscal year, we have had eight different engagement opportunities or opportunities to speak about the the budget uh within the first six months of the calendar year.

And so they range from budget town halls, which we had uh the first one on the 29th of January, the second, 26th of uh February, and then we had the OSHA Civic Academy, uh, which is in partnership, I believe, with MU.

Do we do that in uh and then we had our revenue forecast presentation to the council that was a work session we did we uh had in April we followed that up with another budget town hall in April on capital improvement projects.

Uh we've had a community classroom on understanding municipal bonds, which was I don't know, out of all the engagement we've done this year, that was my my favorite.

It was something new that we uh did with the citizens, and it was it was a really good uh session or classroom community classroom.

It was it was really good.

Uh and then we have the youth civic academy, uh, and then finally our capital improvement plan uh pre-council work session.

So now we'll go a little uh look at the general fund narrative and outlook.

So the general fund is one of the largest funds, second largest fund up basically in the uh budget, and it's made up of what you think about when you think of uh local government, your police, your fire, your uh public works, community development, help, those those things that are natural for a city, and so general fund revenue does not have the same restrictions as other funds have.

They can use it on the it they can be used in a multiple of different ways.

Uh the largest expense in the general fund is personnel, and the largest functional group in the general fund is public safety.

So again, like the Carlin mentioned earlier, uh the 27 budget does not include projected revenue or expense appropriations associated with the public safety sales tax.

This budget is based on uh revenues and current projections for those revenues, and so but once we got those revenue projections, uh all modifications to expenditures were done after that.

So general fund departments and divisions.

Uh we break our budget up into basically five different uh groups.

So we have an administrative group, we have health and environment, uh, which has public health, uh community development and our housing department, economic development, office of sustainability and cultural affairs in it.

Uh then we have public safety, uh supporting activities, which is basically facilities management.

Uh communications used to be under supporting activities, but that we moved communications back out into its own fund is uh in fiscal 27, and then transportation.

Here's what the general fund budget looks like uh currently.

So this is what we are proposing.

So we're looking at 133 million in revenue and 133 in operating expenditures with a amount of 13,014 basically uh revenue over expenditures.

Here is an outlook for the general fund.

And so basically, we will be holding the cash target roughly around the same dollar amount.

There are some changes.

We we do not we won't have any ARPA expenditures in fiscal year 27, being that I guess there's a potential for something to happen before.

Yeah, we we got a couple months before they are complete.

So there is potential, but we basically looking at this as if it'll be done.

We forecast when they all be spent in 26, but it won't have effect on the cash either way if some fall into 27.

All right, so next we'll talk a little bit about where the money comes from.

These are our revenue sources for the general fund.

The largest revenue source for the general fund is sales and use tax at 29%, followed by pilot and other local taxes, and then we've also got some other smaller revenues that also contribute.

This is another way of looking at it.

You'll see some of these categories have kind of a large percent change, but we also put the percent of the 27 budget next to it, so you can see that some of those large changes represent a pretty small portion of the overall budget.

Um, like Matthew mentioned, we moved public communications back into a fund outside of the general fund, which is the reason that we have a pretty large decrease in intergovernmental revenue.

Um, those are the internal fees that we charge to other departments.

So the creative services and contact center fees are not part of general fund intergovernmental revenue for 27.

So we wanted to talk a little bit about the way that the general fund is funded.

Like Matthew mentioned, there's a lot more flexibility in the general fund about how we spend the money that we get.

But with that being said, there are some dedicated funding sources within the general fund, and those are sources that might be restricted or they're collected specifically to offset the expense of a certain activity.

So some examples of that are a dedicated sales tax like transportation sales tax.

Those dollars, even when we bring them into the general fund, can only be spent on transportation activities.

Um, another example is revenue from other governmental units that's tied to a specific program.

So an example of that would be grants that health gets to run specific programs and also the reimbursement that we get from the county for a portion of operating the health department.

Um there are also fees that are related to specific activities like community development permits, um, and then we also have general and administrative or GNA fee revenue.

Outside of those dedicated funding sources, we also have general funding sources in the general fund, and those are revenue sources that can support any activity.

And examples of those are our general sales tax, property tax, business license fees, and all of our other local taxes.

Um this chart we wanted to show you.

This is all of the departments broken down by function.

Um, like Matthew mentioned before.

You'll notice that public safety by far has the largest amount of or the largest share of general revenue that they're using to offset the cost of their operations.

Um, and they also have by far the largest in dollars budget in the general fund.

All right, so the other larger portions of the general fund are streets and engineering.

Um, this division is funded by a portion of transportation sales tax.

The street division of streets and engineering does maintenance on roadways, they do winter weather response, emergency response during other weather events, street cleaning and sweeping, and then vegetation control in the public right-of-ways, and the engineering division does design contract administration and construction for CIP for the public works department, and then they also do survey and right-of-way services, which are things that are used by various departments across the city.

Health is another big part of the general fund.

Um almost half of the cost to operate the health department is recovered either through grants or from the county, who pays for about a third of the cost to operate most of the department.

And health provides a lot of essential services for the community that relate to health, safety, and well-being for all the residents of the city, but also Boone County as a whole.

They do vital records, immunizations, communical disease control, and they also run WIC and that nutrition program and animal control.

And then a couple other areas we wanted to highlight in the general fund.

Cultural affairs does have a partial revenue offset.

They have some grant funds.

They also have sponsorships and ticket sales and donations that help them recover the costs of their operation.

And then sustainability is another one that we get questions on sometimes.

Those operations are covered in part by the city utility departments, which is mostly because the goal of sustainability is to help us meet our climate targets and the CAP.

And that mission relies really heavily on their integration with the utility departments.

And then there are other general fund departments such as community development that we mentioned before recoup some of their costs by charging fees for services that they provide.

Okay, so the next few slides we're going to go over some of just the revenue forecasting that we did.

So this slide here just covers the sales and use tax trend.

You can see the the red kind of represents use, and the blue is the sales.

What we've been seeing is basically use is been um subsidize or supplementing our sales tax and uh allowing us to basically continue to grow with the changes of consumer changes of going from on in-store to online purchases.

The other kind of thing to note is uh 24, we kind of had a peak, and then we kind of dipped back down in 25.

We're expecting our 26 numbers to be pretty in line with where we got in 24, maybe a little bit above those numbers now.

And this just kind of looks at just general fund portion of the sales tax and kind of what we're projecting out.

So what we're projecting is basically uh small but steady growth of about 1% per year from 26 all the way through 31.

Uh property tax is kind of the other big tax that we receive.

Uh and this one is much more stable tax, it's less influenced by economic shifts.

Uh we are kind of seeing slow but steady growth with that one as well from 26 all the way through 31.

Yeah, I will admit.

I was just gonna can I ask a question on uh with like the senior freezing on property tax, like have we noticed an impact and or do we can you even forecast?

Yeah, we did.

We did some forecasting on that, but it's it's it's slight because it it caps it and it just the cap just started, so you really don't see an effect on that until five or six years out when property tax starts to eclipse where their caps at.

So at this point, we're not seeing major changes to it.

Deep, you have more to add on.

I think if you can see that 25 to 26 is the um application in the dealisted value, which is over costing everything.

Yeah.

Which increase our tax base tools.

Yeah.

Right.

I just didn't know though, I don't even know how many are participating in it, whether it's impact.

We did some forecast, we did we did a fiscal note on that.

It was a few years ago when it first came up to state legislator.

I don't remember the exact amount, but what I do remember was that the effects were more long-term than short term, due to the fact that their property taxes when they get capped or uh not much more than where they the growth is until you get like five to ten years out.

Right.

So marijuana tax is one of our more recently uh imposed taxes, and we've seen a pretty substantial growth in 26.

I believe we've already eclipsed or we're close to eclipsing our the amount we've actually received from 25, and we're kind of projecting that to stay steady going forward.

So this has been kind of a pretty big surprise after 25.

We had a big drop-off.

So threat of auditing.

That's right.

Deep deep got you know cracked away.

I think we already made 800,000 by now.

Yeah, we've had a regular, we've had regular months almost every month this year.

Because I say this makes me nervous when I see that big of a jump, and then consistently having it.

So I want to know if you're conservatively.

Yeah, we're not very conservative.

We're not expecting much growth.

And this is a smaller, I mean, it the graph looks pretty big, but it's only a million dollars.

It's small compared to only a million dollars.

The whole general fund.

Yeah.

Okay.

This is just a breakdown of all of our other local taxes.

Um what we kind of wanted to highlight here is that we have several local taxes that are starting to uh decrease.

We're seeing decreases in the annual uh amounts we're receiving, particularly with cigarette tax, uh telecommunication tax, although it looks a little inflated.

Remember that 25 number we had a um that's that century com part of that was at CenturyCom pay pay uh payment.

And then um and then uh cable TV tax is the other one where we're seeing uh decreases in that.

So even though marijuana tax has uh increased greatly, it's really kind of just made it so that the full other local tax umbrella has kind of just seen slow but steady growth.

Yeah, because cigarette tax is is another one of those they're dying taxes basically.

Yeah, and then this is just uh general fund history and forecasts.

So what you're seeing here is uh the line is our revenue forecasts and our expenses or uh and then the bars, the expenses, uh the color coding is all the different uh different uh departments within those groups, and so 26 we're we're expecting to see it be a little bit below uh revenues a little bit below uh expenses, and then we're we're expected to meet those expenses in 27.

But with just the acceleration of expenses versus the kind of the slow steady growth of our revenues, we we we don't think we we're on projections to still kind of see those expenses uh overtake revenues in the out years.

You remind me, so those so this is all general fund, yes.

And our percentage of, and I'm sure you have it in here, but our percentage of our expenditures that is personnel.

What is that?

It's about 70 percent.

Yeah, okay.

Okay, so like those are people, yes.

Yeah, yeah.

Yeah, Beb is definitely coming up in some upcoming slides.

All right now we'll kind of transition to what we have done to look at revenue uh for fiscal year 27.

So uh we did some fee studies as was recommended by the council.

We did this internally, so we'll I think in August we have another separate session to walk you through the process.

So we divided each of the services by wages, uh benefits and all other categories, and we're right.

Almost 70, 80 percent is basically wage and benefit.

We chat with each of the department and try to figure out what time of their um staff is providing is engaging that kind of activity, and then we end up uh valuing, re-evaluating each of their services.

So this that is an example of townhouse inspection by community and community development department, and then we are not going through that, but you you see that uh at that with the current rate of six hundred thirty-seven dollars and sixty cents.

We are basically subsidizing that by around 300.

And we'll go in details during our that session in August.

Yeah, so we we plan to bring the the full cost of service study to you all uh with the first public hearing on the budget.

So we'll look at we'll look at that full uh study, what every everything that we looked at and what the outcomes were.

Well while we did that in-house uh on the next slide.

This is the one on the business license fees.

It's a little different than the cost of service study, but that is done through a consultant company called Cost and Revenue Specialist that uh in California based.

So basically in short, they used I just put one screenshot.

They use three major indicators to figure out the cost for each of those fees.

Not the cost just how much the public resources have been used.

One is the police demand, and the other two is uh how much that business utilized our streets and traffic and those services, and the third one is the fire.

Based on those three metrics, we are trying to come up for the business license fees also.

And I think uh the consultant will present that to you guys also that's yeah, and so this is something that we will have in place by fiscal year in fiscal year 27 for the uh that business license process.

Yeah, folks.

Yeah.

Uh there are we currently have a freeze, right?

That's what we have okay.

Yeah, and so uh this what we're showing here is still looking at gross receipts for all the business licenses, but uh there are a few that we we're we're trying to figure out how to uh possibly do one by uh employee count and then one by square footage, and so if we work through this, uh we'll we've been working with the the chamber as well and having meetings and things like that.

So now we'll get into our uh fee methodology.

So um we get a lot of questions about GNA or general and administrative fees.

So as a reminder, we put some slides in here to talk about the internal services that the general fund provides, and then the way that we charge those out to other city departments.

Um GNA fees recover the cost to operate operate the city departments or divisions in the general fund that serve a general and administrative function for all city departments but do not generate their own revenue.

So the cost to run those departments or divisions are billed to the other departments through intergovernmental fees, um, and the way that we charge those is based on each department's share of the total budget of the city in certain categories.

There are also several items that are billed directly to specific departments.

Um a couple of examples of this are the airport safety division of police and community development credit card fees that are charged directly to the utilities for the permits that they do.

And then there's an additional piece of this fee that recovers the cost to operate human resources and payroll, and those costs are recovered on a per employee basis since the function of those departments is really based on how many employees a department has so the departments that we recover costs on are the city counselor division of law, um all of finance except for business license, which generates its own revenue, um, city council except for boards and commissions, city clerk, except the elections division, uh the city manager's office excluding violence prevention and human resources.

The other administrative departments are excluded from those calculations, mostly because their function is focused externally rather than performing an internal service for the city.

Do you have any examples of those?

Uh the administrative departments that are excluded from the fee calculations?

So, like business license that would be giving licenses to businesses outside of the city.

Um community development that does permits and things for third parties that are outside of the city.

So the purpose of GNA fees is to recover the cost of the departments that are in administration that do work for the other city departments, not for the public.

Okay, thank you.

Or not directly to the public, I guess.

Sorry.

The other fees that we have in the general fund are related to facilities, and those are building maintenance, utilities, and custodial fees.

So for maintenance and custodial hours, we track those for each building and average them over four years to estimate what percent of time that department is spending in each building, and then we charge the departments based on square footage and how much time the facilities department is spending on each department.

And then the utility costs for city buildings are also recovered from departments based on square footage for the ones that are shared buildings.

Um if a department owns the entire building, then they just pay the utilities for that building.

All right, now we'll get into the expenditures for the general fund.

So this is what our expenditure by activity looks like uh for fiscal year 27.

So again, personnel is around 70 percent of the general fund budget, and then when you add the services to that, uh you get up to about 80 percent of our budget being personnel and services.

The rest are uh smaller items that that don't affect the the budget as much as personnel and services.

So we put a we put a percent change for fiscal year 26 to 27, and then we put a percent of the budget just so you can kind of see uh the things that we did to to balance this budget in fiscal year 27 for fiscal year 27.

And personnel services does include a cost of uh living salary adjustment.

Matthew, do you get into more details on that one?

Or is now the time okay?

Okay, so some of the things that are include included in uh purchase services are pavement main maintenance, uh social services funding, uh office of violence, prevention, strategic planning efforts, uh litigation, uh, vehicle maintenance, uh sampture grant or substance abuse and mental health program, uh, and then building maintenance and advertising.

We get a lot of questions as well on the miscellaneous expense category.

Uh this is something that in the future will be broken out a little bit more because of some regulation changes uh with uh is it GASBY with some GASB regulation.

Gaspy stands for.

What'd you say?

What does Gaspy Standards governmental accounting standards?

Standards boards.

Thank you.

So that that is our our governing body for accounting.

And so here you can see about 24% of miscellaneous fees are credit card fees.

Um, and then only about 27 per percent are truly like miscellaneous type of items.

Uh and so some of that is like name tags, uh retirement tiles, uh, copies of keys, so just very miscellaneous expenses.

Here is uh a breakdown of the budget by department.

And so again, our police and fire make up the lion's share of uh the general fund expenses, followed by public works and help.

And that city council number includes boards and commissions, which is uh it's a pretty big share of that city council number as well.

So now we'll get into some of our uh council the council priorities for fiscal year 27.

And so here are the four council priorities that were decided on, I believe back in January.

Uh city employees, we have public safety, affordable housing, and resilient economy.

So for the city employees, uh we budgeted a 3% increase to employee wages.

Um we were able to minimize increases to most insurance premiums for fiscal year 27.

Uh I believe all of the family plans decreased.

Uh the only real increases in uh insurance were to the 750 plan because it has basically been subsidized by the high deductible plan for a long time, and we're trying to get those fees more in line.

Um we had uh dental rate increase of about three percent.

There's been no change in vision costs, and then uh the deductible for the high deductible plan increase this year, uh which I believe the city pays half of that.

Is that correct?

We don't have any more from help.

We contribute to um HSA, and we did not increase those contributions this year, but we uh we will continue to contribute 1700 to individual plan and 3400, I think, to family land.

So public safety um was been included in that for this fiscal year is a purchasing of 10 sets of protective gear to stat it establish a dedicated academy uh inventory.

We have the block by block contract.

We plan on replacing uh 20-year-old confined life safety equipment, and then Knox Box uh replacements as well.

For the affordable housing, we have uh home funds and amount of six hundred and ten thousand, about a half a million in CDBG funds.

We have the million dollar affordable housing trust fund.

And then also sort of wanted to note that the Columbia Boone County Housing Study earned a national award for impact.

So I thought that was something that should be noted that I think I sort of glossed over this year, and especially in the new ones.

Matthew, can you um the $1 million for our housing trust fund?

Yes.

That's not an additional one proposed in this year.

That's from fiscal year 25.

We still have it in there.

Yes.

And so that was put up there because we uh still sort of going over what we're gonna do, what the plan is uh to spend that money, but also we want to make sure we had money coming in how to fund this moving forward before we started spending that money as well.

We don't have any mechanism for funding that additionally in this budget.

We we don't currently, but that is one of the things that the council can decide on.

I'm sorry, what was the question?

Uh do we currently in our in this current budget have any mechanism to add funding to the affordable housing trust fund?

Okay.

And and the answer is no, it's one of our decision items.

Okay, thank you.

Uh and then for resilient economy, uh, what we've done is we we've completed the cost of service study.

Uh so that again that was an internal study that we did.

We looked at all the fees uh that we collect, uh, made sure that when we present them to you all, but I think that'll be when the decision will be made if we increase fees that we leave them the way they are.

Um I don't think we saw any fees that were too low.

I mean, well, too high basically.

Uh we did see a few fees that were just basically recovering what they should recover.

So, but that'll be a I feel like that'll be a good conversation we'll have.

Um, then we also conducted the business license fee study.

Um, I want to want to highlight the the hiring of the new director, assistant director for economic development, and then the business development specialist uh who sort of helped to expand that uh taxable business base that we have and then the again kind of noting what the calliness said earlier uh in reviewing this this fiscal year budget uh we reduced proposals to ensure that we had a balanced budget for fiscal year 27 so like Matthew and DeKarlin mentioned, we don't talk about our internal budget process normally at these meetings, but we wanted to this year to kind of walk you through how we got to the proposed budget that we're presenting for your consideration.

Um just a brief overview as part of our internal budget process.

Um all of the departments submit requests related to their ongoing costs to opt to continue their operations at the same level, um, as well as new decision items, which we call NDIs.

Um, those requests would be to increase funding levels for a new service, a new program over last year's levels basically.

After that, internal meetings are held both with finance and with the city manager to evaluate those requests and award initial approvals for any items that um the city manager thinks are necessary.

Um I will say one note on that.

This year we actually did two set like in the past, we did meetings with finance and the city manager together.

It was one meeting.

This year we've broke those out.

We had a meeting with finance first to make sure that we were we were in a uh good understanding of the increases and what was proposed in their budget, and then we met with the city council together as a team.

So this was a very thought-out, very deliberate uh budget or planning for this budget.

Sorry.

And then after we have those internal department meetings with the city manager, um my team prepares the initial draft of the proposed budget for review by the city manager.

Um, and at that point it became pretty clear after we had our revenue projections in and we had all the expenses in the budget that there was a sizable deficit in the general fund.

And at that point, um, we decided to do a little bit more to try and get to a balanced budget.

So we had a citywide internal meeting with department directors to present the initial numbers to them and also implement budget cuts to balance our proposed appropriations to what we're expecting to receive in revenue.

And the following slides in this presentation detail the amount and the nature of the cuts that were taken internally to arrive at a balanced general fund budget for your consideration.

And I do want to stress just again that this it these cuts on the next few slides are not cuts compared to the 26 budget.

These were the result of the city's internal review process based on what was initially submitted by departments, approved by the city manager, and before it was presented to council as a proposed budget.

So just to clarify, these these cuts do not reflect cuts to services that are currently ongoing.

They reflect cuts to new decision items.

So they're both.

They will reflect cuts to new decision items, new positions, as well as current positions and current programs and activities that are ongoing.

Yeah, because I think you we need to note that when we started the process and we looked at what our revenues are, our revenues grew by a little over like a million two, million three.

And just to start off talking about salary increases alone, that was three million dollars.

So going into this process, we had to cut the budget in order to balance the budget just for raises.

And so these process looked at new decision items.

Some items did come through, but there was also a cut in something else in order to make that up make that occur.

And then that was true for last year's budget as well.

So this is a process that we go through every year.

Um however, this year it was a little bit more strenuous, I guess, than it has been in past years.

So every year we do what we can to balance the budget.

Um, we look at funding sources, we look at expenses, we try and cut things as close as we can while still giving the departments what they need to to perform their functions.

Um we're to the point with the general fund where, like Matthew and DeCarlin mentioned, we've got a steady increase in revenue, that's about one percent or you know, right around a million dollars, and then to continue to fund raises for employees and to continue to fund inflation and increased costs on all of our materials that we purchase and everything that we need to provide service to the citizens.

Um, our revenues are not keeping pace with that.

So on this slide and the next slide, we detailed how much by each department in the general fund was cut, um, and we'll go into a little bit more detail about these later, but the total amount that we cut internally before the budget that you are reviewing now was about 7.3 million.

And kind of a broad overview of that, there were three point six a $3.6 million decrease in personnel.

That was driven both by holding pre-existing vacancies in positions open, um, eliminating some positions, and then denying NDI requests in FY27 that were related to staffing or new positions, and those are items that were initially either approved or held in the budget meetings with the city manager.

In addition, there was a 1.6 million dollar decrease to new decision items or NDIs.

Those are everything that was non-personnel, and again, those were either initially approved or held during budget meetings with the city manager and then denied at the second meeting.

Those are direct cuts to existing program budgets and funds to keep operations at baseline level compared to a previous fiscal year.

Um, and because of the other cuts that we did, we were also able to decrease our intergovernmental charges.

So just like the general fund charges other city departments for services that we perform.

There are other internal service departments outside the general fund that charge fees to the general fund.

And because of citywide budget cuts, um, as well as the decreased budget of most general fund departments, we were able to decrease the amount of charges that the general fund is responsible for paying.

So we tried to break this down in the next few slides into the major changes kind of by category that we had, and this first slide shows the personnel reductions that we did in the existing budget.

So the majority of these were accomplished either by eliminating positions or holding positions open or vacant for the entirety of FY27.

So what that means is we budgeted, we didn't eliminate most of these positions.

They're still in our authorized FTE list or full-time equivalent list.

However, they're budgeted at zero.

So there is no money in the budget to pay somebody for this position for all of fiscal year 27.

And the total of that was about 1.9 million.

Can we go back?

Yeah, yeah.

Yeah.

Do we have any more information about what positions those are?

Yes.

Um and what the effect is to that.

We can we can give you a list of those, but we did plan to go over the NDR request.

Um when we go over the all funds on Friday, we'll have a list of everything that was approved and everything that was not approved.

And make good decisions, you know, so or ask good questions.

So if we have that info before I can spend a few hours looking at it and then asking those questions.

Yeah, that's fine.

I'm particularly looking at the 919 for police.

And I know that's one of our larger personnel departments.

And so that is no sworn officers.

So there's no cuts to sworn officers.

And these are just freezing open positions, they're not laying people off.

That's correct.

For police, we also built in, um, they've got one of the biggest budgets in the general fund, and the majority of their budget is personnel, just like with everybody else in the general fund.

Um, they also usually have a a gap between what we budget for personnel and what they actually spend.

Um, and so what we did was build in about 750,000 in planned labs.

I know we hate that word.

Uh, between what we budget, what we would need to budget for all positions and what we expect to spend.

And so that so I think that's important to note that it's not necessarily it's not necessarily mean that police officers won't be hired.

What we realize is we have two academies that hiring time is over a period over a year's time.

So October 1, we're not gonna be able to fully hire everyone that every vacant positions that we have.

And so this looks at a process to better account for that to make sure that we're more in line with actually what our spending are.

Isn't that time gap what we were citing as something that was allowing us to recruit in advance of what we need more effectively?

Not the not the timing gap.

Well, what what's what was happening is it's kind of what led to some of our significant look at what could be considered not necessarily an over expenditure where you have this large you have this large department which is 85% people, and if you have significant vacancies, if you budget for those vacancies at budget time, then you have this period of time where you're not spending, and so you're you're not utilizing your funds, so it kind of gives us false look at our budget.

This is a better alignment of to making sure that we're accounting for when positions will be filled, so that we don't have this over generally like the also way in when you're done.

Yeah, I was just gonna say it might be helpful to think about it in this respect.

Like Sergeant Ray retiled the last week or the week before.

So it'll take 10 to 12 months to fill her spot.

The only way that won't take 10 to 12 months is if we get a lateral hire from another department.

Um that unfortunately those are few and far between.

So every time someone retires, quits, moves away, it takes 10 to 12 months to fill that position.

And so I think that's what they're trying to build into this.

But my understanding is too if we can fill all the spots, we'll fill all the spots.

So a few months ago when we got permission from the city manager to I don't want to say overhire.

Over list positions that we didn't plan for.

Yeah, it wasn't overhire, okay.

But we're still still in place.

Yeah, but we're we're still far from the yeah, we're still behind that.

So we're still building in a company.

And that whole process was to allow that if if we have an academy class and we're prepared for that academy class and we can go ahead and hire in anticipation of them actually coming on board.

But we were still we still have a vacancies there, we still have retirees retirements that we know are planned for.

So this just allows us to have a better process to make sure that we're we haven't tied our hands to the point that we can't do something by anticipating of what may happen when we know there's gonna be a period of time before we can actually fill positions.

Would it be I and I don't know, is this is an exercise that you do is kind of at the end of the year because the whole intent of especially for I imagine for police is because those that budget that's in the account that's not spent is just then going to reserves.

So we don't have a dedicated public safety fund, so it has to go back in.

And if you remember, was it three years ago that we had the we start talking about laps, and that got really confusing and it really made people angry?

Yeah.

I mean, this is what it really is.

It's a conversation of understanding that you're not going to be fully staffed in October one.

Jill, you had your hand up again.

I was just gonna say, too.

The other really hard moving target is like right now.

I get an update from my hiring supervisor every Friday about how many spots we have built in the academy.

So right now we have six for sure hired, but we have 13 on that list because they're in some point of the hiring process.

So we could have all 15 filled in the next category.

We just won't know until we everybody completes the process.

So it's really a moving target every Friday for us.

We count.

So this is something again that we look at.

Oh, sorry, yeah.

Oh, I mean, my question was looking at a different line item on this slide.

So if you're related to police, go ahead.

Uh yeah, I will say something really quickly if you don't mind.

Um so we look at this every year.

Police obviously is a big like Jill mentioned, it takes a long time for them to hire, you know, they've got a little bit more lead time than everybody else, and because they're in the general fund, they share resources with every other general fund department.

So if we over budget their personnel, that's money that we're directly taking away from a different department or a different program that could potentially be using it.

Um, and that's one of the reasons that we do put in or build in a little bit into the personnel budget.

Yeah, so my other question would be because the second biggest number on there, the 288,000 coming from health, with a much smaller department.

That number is very scary.

Are you able to talk to that one at all?

Yeah, yeah.

I might let Michelle or Rebecca talk if they want to, since they hi.

Um I can't wait to see back in the health, or that we're recommending to eliminate one is an LPN, and these were all vacant positions, by the way.

An LPN, a communical disease specialist, one of our HIV care coordination positions, and the reason for that is the HIV um uh case management program is funded by a grant, and that grant has remained flat, and so as our salaries have increased, the grant is not keeping pace, and so we're eliminating one of the open positions to better align with the dollar amount that we're actually paid for to perform that contract, and then we have uh two positions that we're not filling this fiscal year.

One is our planning supervisor, and the other is a health program coordinator.

And there are with health and with all the other departments, there are operational impacts of holding positions vacant and not being able to hire.

Um, so this is an example of we cannot balance the budget without some impacts that you know, seeing the other question.

Um sorry to make you stand up again.

Right back, but oh sorry.

What is the um impact to community health?

Uh knowing that you won't be able to fill those positions.

So we have other you're gonna see in future slides some of our other impacts, but for these particular positions, so eliminating an HIV position means that the case loads will be higher.

Case meaning for the case managers that are remaining.

So we provide HIV case management services across how many counties?

37.

37 counties in Surrey.

So the remaining case managers will have higher caseloads per case manager.

Um that caseload pretty high already or is it pretty manageable smaller?

Um so and then with the communical disease specialist, one of the things that we're um looking at doing is as we eliminate the LPN and the communicable disease specialists.

So we're gonna take those two physicians and we're gonna replace them with one nurse, one R in that can do the services of both of those job titles, and it's at a cost savings.

Um and then the impact of not filling the planning supervisor, it's span and control.

So the manager that's overseeing those uh health planners has a lot of direct reports, and so it impacts that manager's ability to to do all the other stuff that they want to do because they're a little more in the weeds than they should be at the manager level.

Um, and the health promotion, or I'm sorry, the um health um program coordinator.

Thank you, Michelle.

That's really you know, that's position we would use to work on um chronic disease or injury prevention or uh mental health, just some other public health issue that we're not dedicating staff to.

Thank you.

The HIV was a grant from the state, correct?

It is a state grant, okay.

Thank you.

So the HIV personnel in particular.

I thought that was a decision last year that we decided we would need to come up with the extra funds to cover that gap in funding because we couldn't do without that.

Is this something that has that landscape changed, or has the budget just gotten more gritten?

I don't remember that being a conversation last year because there has not been any change to there's not been a reduction in that particular contract, it's just that it's remained flat.

So it is not kept up with our increase in salary, any intergovernmental fees that have increased, it's covering less and less of those expenses.

Okay.

Thanks.

Yeah.

All right.

So in addition to those personnel items, we also had a pretty significant amount in NDI reduction.

So as a reminder, these were new decision items, new things that would have been added with the 27 budget that initially were approved or held and then were later denied.

Um and those impacts are being felt across most departments.

Um there's also quite a few new positions or um personnel related NDIs that were not approved for consideration in the 27 budget.

Again, police has a big number.

A lot of that is because they asked for an increase in overtime and standby pay to kind of match what they've been spending in those areas.

However, like we mentioned, there's usually a pretty big gap between what we budget for their personnel and what they spend, and so we didn't deem it necessary at this point to include that in the budget given how tight things are what happens if they end up needing more of that gap than we anticipated, because that's something that then we bring it back to you as well.

We'll bring it back to the budget budget adjustment.

Yeah, we do those quarterly uh budget amendments, and so what we'll do at the end, just like we'll do at the end of this year for fourth quarter, we make sure everything is in alignment, and we if we need additional authority, uh we'll do that.

But sometimes it's a matter of just moving uh expenses around to make the the expenditures correct.

So actually, I was gonna ask a question about that.

Um when we do, you know, we we mentioned uh at the last quarterly adjustment, wanting a little bit more detail, right?

Not we don't care about brevity of the council memo, right?

You want the details in it.

Can we also include if there's a quarterly adjustment if it's related to an NDI that had been proposed, but then we held it, you know, we didn't do or are we not proposing to approve it?

I think that would be good and useful to see like, oh, because it's not like the need has gone away, these departments have requested it, especially if you approved it originally, but to see like as your expenditures change or maybe more revenue is it's coming in better.

If we could see that that's tied to those, I think that would be a good exercise to do can you say the ask one more time?

Just making sure that yeah, so like when we get those quarterly adjustments, right?

Um I I and I'm assuming that some of the ones that we had over the last year maybe had been NDA new decision items that had been asked for of the city manager and finance, but at the time because of resources they didn't have it.

I think it'd be useful at the next quarterly adjustment that we get, like after fiscal year 27 is adopted, if those are highlighted, if we did find the funding for whatever, so that it's showing that that need is still.

Does that make sense?

I don't think nobody really agreed, so it's like just does that make sense?

I mean, could I give you this?

I knew what you were asking for.

All right, all right.

Yeah, all right.

Thank you.

I have a question.

Sorry, on the NDIs um with the fire one.

I am wondering.

So I know that earlier this year we had the conversation about their new project of increasing paramedic training, doing it for free for that first year with the hopes that there would be increased salary in the future.

Was that one of the NDIs in this reduction?

Okay.

What is included in that?

Because that's that's not personnel.

The big right?

Because their big number is operating.

So there were um the largest portion of that.

Do you want to talk or you might what is included in that 542,000?

Half of it is personal productive equipment or uh personnel to respond to rescue situation like the landfill the other day.

Uh lightweight and able to work in this alignment.

We don't have um any type of personal productive equipment for those type of calls or a Rama calls.

So it's a dual certified that was half of that amount, and then I have to follow up the specific in the ISA probably have it.

I think the other biggest portion of that was that there are quite a few um building improvements that are needed at the fire stations.

Um what was asked for was more than we were able to afford in the general fund, and so we asked them to cut the list of um building improvements down to about 500,000.

So there were, I think 236,000 that we had to cut out that they had initially asked for.

So both of those things are one-time expenditures, these aren't not ongoing.

That is correct.

Okay.

So what is the long-term impact of not doing those maintenance items this year?

Sure.

I mean, do you want to speak to that?

Sorry.

What is it's kind of what we've been dealing with now is that we have a lot of buildings that are aged that we that we know there's significant needs for improvements, and so it's putting it off for another period of time.

This does allow for some of that to be done, it's just not the full amount that they've asked for.

Yeah, and it we they asked us to prioritize it.

So watch more mold and and problems with you've seen the stations.

So it it just temporarily fixes and gets us through.

But like DeKarlin said, it's it's what we've always done.

Just kind of kick the can down and then it exacerbates over time.

But if you know, when we were prioritizing, it was it was really what what we could afford that was absolutely life safety, and then everything else just kind of has to go on.

And it's kind of and if you listen to some of the conversation that uh Jill does a great presentation where she talks about the fact that in the past in the in the past we didn't talk to council about here's the some of the things that departments have asked for that we just couldn't afford.

And so that's what this conversation really is, is we really want to highlight here's what departments are asking for, but in order for us to balance it to have a balanced budget, we just can't move it forward.

I also want to say thank you because this is something that council asked for last time we did the budget.

So responding to the questions that we had for you.

Absolutely.

What's the 542,000 from streets?

Um, is we had budgeted for salt and similar materials in the South Salt dome.

Yeah, chances are I'm not gonna have that rate of put salt in it anyway.

So we if we have that, we'll split between our current salt dome and the south salt dome.

So about $370,000 of that $542 is that um then there's a couple other items in there.

Um you remember we had a 10 uh we had a 10-year getabout grant.

That's what put in a lot of the bike lanes and all that striping.

As you can imagine, you get a grant to put things in, but that doesn't pay for the upkeep of those things.

So we were working on increasing our pavement um marking and our budgets to account for that.

So that is part of that, and then if you remember, we brought the council um we have an agreement with the county where we take on some of the county streets when so much of it gets annexed on either side.

And we take those on, we look at those and say, hey, this is work that we need to do that the county for whatever reason didn't do, and so that will have to get absorbed by what we use for payment preservation elsewhere.

There's about 90,000 or so in that.

So those are the three items that make up that 542.

So does that mean that those won't get done?

Where do the happening will do less payment preservation citywide next year?

And the and then less pavement markings.

Um, yes, in spots.

Um there's some areas we've delayed on bike lane, things associated with bike lanes, so we could probably still delay.

Some of that would get picked up by our current pavement marking budget.

Um, or it would come out of what we use for pavement preservation.

Because I've got a mark.

do less payment preservation citywide next year and the and the and less pavement markings um well yes in spots um there's some areas we've delayed on bike lanes things associated bike lanes that we could probably still delay some of that would get picked up by our current pavement marking budget um or it would come out of what we used to pay for this i've got a mark I don't necessarily have to do the payments or places where I can't do taking county roads that aren't up to our standards and then not being you know what I mean that's it yeah okay thanks for that yep we should do the private roads too if we're taking the county road so I'm sure you're noticing a theme where we're putting off things that you'll probably see again next year um or at some point during the year if they become a priority and that's kind of the the spot that we're in to try and balance the general fund.

So the last category that we wanted to talk about were operating reductions.

Some of these like DeKarlin mentioned were reductions that departments made in order to offset costs for new items or new um new decisions that they asked for in the 27 budget and then in addition we also have a half percent cut to services across the general fund that we implemented at the end to balance the general fund um and that affected every every department in one of the prior slides you guys showed that city council and commissions get like 5000 why what is that what is that money going to because I I guess I just am too new to understand so one of your yeah one of your handouts is your city council budget so that'll show you what is in there of the other one.

You're talking about probably the other one yeah so you've got an admin division that is the budget for the six of you today um and then you've also got boards and commissions as part of your budget and each of those boards and commissions have individual budgets that they submit to the city um some of them are not funded but the ones that are are included in those numbers and we've also given you some historical information on boards and commissions that includes their budget versus what they've actually spent all the way back to 2020.

That number is quite large and that's something that you all probably have not seen before but we did want to sort of make you all aware of that because there is some flexibility especially for some things that you all may want to do differently within the city council but yeah and I I would like to speak to that if all possible so in the so the flexibility lies in the fact that we have money budgeted for boards and commissions but they're not spending it consistently okay so I would like to make um a suggestion and I recognize this is a work session and we're not voting but something for us to consider um as we have seen changes at all levels of government I think it's important for us to be thinking about our current city council and future city councils and if it would be possible for us to take some um some of the board and commission money that is not being utilized and create some kind of stipend I don't know what that would look like for city council persons to utilize if needed for their own personal home security systems because that has become a very real issue for multiple council members not just on this council and for me personally for previous council members and in order to keep people continuing to want to serve in this capacity I think it's an important public conversation that we need to have and so I just kind of I want to throw that out there as a discussion point as we move forward.

I feel like if we're asking I agree safety is important.

But if we're asking certain individuals to go like cut their budget by significant amount we should also be looking at how we can cut ours as well I think there's definitely some room to do that within that the boards and commissions budget so they they I believe their budget is somewhere around is it two to eighty something like that.

It's on hundred well 16 I'm sorry I'll I'll overshot that but they consistently spend around eighty ninety thousand of that so it's about it's about uh 50 percent over what is what is budget.

Well and I think you know and and I know the city clerk had done this before with the staff liaison like asking you know I think we had our asks maybe back in January February to ask the sta the boards and commissions what would you like some cut some asked for more and and I think we said no to the more requests.

Did no to we should just we so in prior years we said what changes do you have to your budget or we said no increases or whatever.

This year we didn't even ask them anything.

We told them that their budget was gonna remain the same, like no unless they had cuts, and that was part of the direction gave us at a work session.

Yeah.

And so they did If so they evaluated their budgets, not very many of them did because of that.

I think that's one of the things when I look at this, like I look at planning and zoning, which you know, they stay as late as a council member does to the council meeting, so I think feeding them I'm totally you know what I mean, like for their support.

But for the ones who consistently do not spend, I think I would I would look for that proposed reduction in moving forward for what it is that would you like us to propose something?

Or would you guys can see I mean I see you put it together, but like I think you can look along with finance along with the staff liaison onto it, because they would also probably know best with you know that actually that's like for instance the building construction codes commission, right?

I mean, Clint, you have every few years they have to purchase those books for the code, like I mean, there's there'll they'll be knowledgeable, I assume, on expenditures, but the ones that are consistently not is to reduce that.

Okay.

I mean, because that's I mean that's that's what I was good at.

Yeah, yeah.

Yeah.

So we did implement the only cut that they had.

There were a couple that cut voluntarily when um you all asked before earlier in the budget process, and then we also implemented that half percent cut to services um across the board, which included the boards and commissions, so any of those that had a budget in the services category.

So intergovernmental or council increased by 255%.

What is that?

Apparently it's the laptops, it's related to laptops and um devices essentially for laptops.

We took the laptops out, they don't have laptops or boards and commissions.

It's like the ones in the council ones within the council, like disabilities does zoom meetings, it's laptops used for that.

If council ever did zoom meetings, we'd have to use the laptops for that.

So they're housed in creative services or communications, whatever that's being called right now.

And we added those this year?

They moved from creative services to your division, which was why I believe because boards and commission creative services decreased by that amount.

Yes.

So part of part of the challenge that we have when we are moving departments around.

So we move public communications into its own fund.

Um that fund performs an internal service for the city, and the cost to operate that fund gets split out to all the departments in the city that use their services.

Um, we've got admin departments and general fund that also get their costs split out to other city departments, so we do our best to try to allocate appropriately the cost, and there are certain costs that should not be included in a public communications fee.

Um that is something that we're willing to discuss if you'd like to.

Um where the laptops are located or where they get charged, those are things that we can change internally, but there is a consideration for where we put them and whether or not they get charged out to other departments and in what capacity when we do that.

So some expenses of boards and commissions are within that department that houses them, and some come through the council.

Is that correct?

That is correct, right?

Because I'm I'm assuming there's quite some P and Z expense.

I don't know if there's any commission or whatever that price can use.

There's lots of commissions that aren't funded through the council budget.

Correct.

Like Board of Health or subs well, substance now might have something, I guess.

I mean, this is there's a there would there's a there's a place to charge it.

It is a general fund charge.

It's just where we charge it in the general fund, whether it's so we can figure that out.

And the consistency is appreciated.

Yeah, I think the the biggest I had the same thought, but I was like, Well, that's an increase, and I don't know what changed.

So the biggest thing is because we because communications now became this fund that's charging it's it's used to to other departments, it's not fair to charge other departments for something that they don't utilize.

So what do you charge up to?

Do they charge council for like how long our meetings go and do we have to pay more the longer we go?

Well, some of the council expenses is spread out to other funds, not just the general fund.

A little bit of that increase is probably also your public communications charge.

It's not in the general fund anymore, so the general fund is explicitly paying for those services now, but they don't charge by the minute.

We can forgot a better way to show it.

Or explain it, yeah.

Like we mentioned, this is the first time that you all have seen your budget.

Um, all the other department directors and and departments have seen their budget previously, so um we're open to any questions or changes you have.

Yeah.

Well, I think one of the tricky ones we have too on ours is that like we've had a lot of turnover on council.

We've had get vacancy, you know, right now we have a vacancy, so it's kind of like to look at these averages, like I can tell you a different empty spot at council.

So I don't know what is consistent as far as that get bureau.

Yeah, and I in terms of that and understanding like what these divisions actually mean since it is the first time that we're seeing this.

I think it would be helpful to see it a little more broken down, like in that 2025 actual what was what I mean.

We don't need to know like exact line items, but maybe an understanding of what fit under materials and supplies versus what fit under intergovernmental, because I'm not sure I have an understanding of what would be materials and supplies versus what would be a public communication thing.

Yeah, and it I think prior to that point.

Um I know we did a work session earlier this year, but we also did one last year where kind of we talked about reducing in our services, like what council had for some of the things.

So maybe I'll we'll have if that can be shared or just the presentations that we had on that.

Sheila, do you know what I'm talking about?

I I know I had a sheet that had a summary at least on the council side.

You don't have to speak to boards and commissions on that point, just ours.

Yeah, on the council side as to what kinds of things come out of what.

Yeah, so I can provide that.

Yeah, because yeah, we made the you know, originally we were talking about um we did like news, you know, council, but that engagement, and then we never really spent the money, so like we cut that out of our budget, but I think that'd be useful information to see so uh we'll sort of wrap this up with the impacts to the fiscal year 27 uh based on those budget reductions, and so we have uh delaying critical replacements, upgrades and purchases.

Uh we're reducing the utility assistance fund from 600 to 400,000 dollars, and so we have uh an audit that uh will go along with that, and so that will be presented August 3rd to you all.

Uh the internal auditor or the uh I guess performance auditors.

External internal audit uh Ruben Brown will be on site to sort of discuss uh everything that we looked at uh with that utility assistance funding, and this basically came from us going through that $800,000 at an extremely fast pace this year.

So just creating a better program uh and giving a better suggestion to you all on how to utilize those funds.

Uh then we had a reduction in social services funding uh by about 10 percent.

Uh some of that 10 percent was the increase to the social service funding as well.

No, that's not it's not, it was all okay.

Well so they had requested a CPI increase to their social service funding as an NDI, um, which is not in the budget, and then this is an additional 10% decrease over what we funded that at last year, or in 26.

Then we are holding open or eliminating positions.

Uh we're doing a discontinuation of the family planning services.

Uh, we're gonna defer defer the drone fleet program.

Uh we're gonna delay the hiring of the real-time information center uh specialists, and then that across the board uh half a percent cut in service in the service categories.

Yes, you mentioned uh the deferring the drone fleet, so there's currently a fleet there, it's the replacement of that.

Correct.

I'm assuming the the maintenance and all the security updates will still continue to happen for those things, maybe that they're not gonna whatever maintenance that might look like, so that we're not creating unintended security holes or something.

Yeah, but yes, I don't know.

Nothing was nothing was decreased from the maintenance.

I don't know.

I'll see you putting their head up, no, you did it.

Okay.

All good.

Okay.

So they're not past their extended warranty or anything like that.

Yeah, they might be getting close.

The big big question mark is all Chinese-made drones.

So if the state decides to outlaw those or the federal government does at any time, or the replacement going forward will always be American made so that we don't have this issue anymore, but we bought them back when this was not a thing.

Um right now they're all in compliance, but if that changes, but certainly when they reach their end-the-life word placement, they'll be replaced with American funds.

So if we went and and you can tell me that we're gonna talk about this in August, but if we went through $800,000 so quickly, then what's it I mean, how can we uh cut it?

Well, so that's I think so.

One of the things that we have to so our utility assistant fund when we were receiving ARPA funds, we didn't put any guardrails on.

And so there's this there was a demand for a lot of use, and when we really looked at the program, the program was probably greater than what you would see in most communities.

And so we had Ruben Brown do is actually do a study to look at exactly how other communities and other utilities are utilizing their fund to make sure that the program we have in place is something that makes sense, that's something that's actually the correct size for what who we are.

Uh it's still higher than most places, but it's not as rich as it was when we was ARPA funds that were funding the program.

So it went from ARPA funds to the general fund.

And so it's how does the general fund sustain this type of program?

How does the need in our community compare to the need in other communities?

I would say the need.

I would say the need is probably pretty much the same throughout.

I mean, there's a general need for for help.

There's generally a need for assistance.

I mean, one of the things that you saw is that you know we were having people who were it was their they hadn't used their trash service for for a period of time and they were using that as uh utility assistance.

And so it's really making sure that if we're gonna have a program, the program makes sense.

Our child poverty rate is high compared to other cities in Missouri.

Absolutely.

Are we expecting our utility assistance to be high compared to other cities in the I think it's looking at the amount and it's making sure that what look making and this is and this isn't in no way to say that people shouldn't receive help.

The question is when you look at your program, is it a program that you can afford?

Is it a program that makes sense compared to how you look at all other utilities and other locations without throughout the city throughout the state?

And so they really did do a really good analysis to look at exactly how some of these other programs are functioning and what would make sense for us.

Again, this is our proposal, but when you when you're looking at how do you balance your budget, there are there are a lot of hard decisions that had to be made.

This isn't this is not an easy process, and it wasn't a fun process to get to how do we make sure that we get to balance.

So I want to say I'm I'm fine with holding this conversation off till August when we have it next.

I I think there's definitely more conversation here.

Um yeah.

Um my concern is that that need doesn't go away.

It does not it shows up somewhere else if it's not paid for here.

Um the costs to our other programs will increase if we don't pay that somewhere.

I mean, there's plenty of studies that show that by reducing that stuff ahead of time or addressing on the front end rather than waiting till somebody's had like major catastrophes, it's way harder to bring somebody out of that situation than to help them at that point that they need the help or right before.

Is this a work session in August?

What's what's the plan for this discussion?

Oh no, it'll be presented at a council meeting.

August.

This is the the report from the auditor.

Yes.

Can I ask and I don't I can't remember um you know, one of the things that we attempted to do with our ARPA funds was to do some of the physical improvements to some of our are we gonna have a kind of a report on that, or you know, like what the impact was of that?

Because I think the weatherization Christina's point, you know, one of the conversations that we've been having for years is make physical improvements to these structures so they don't have to lose as much.

And so was that done through housing or was that done through sustainability?

Housing housing.

So the weatherization program, can you bring a report that kind of shows exactly the number of homes that were improved and certainly and then are we continuing that program without ARPA funds?

Uh we have a little bit of block grant money dedicated to it.

We applied for a federal home loaning grant to continue that because you know, as you know, it's funded with ARPA.

Yeah.

Um we can get your report on how many bit assisted.

I'm gonna how if we can get with that report, like how many of the people who are needing utility assistance are successfully um, I guess transferred to the weatherization programs and can meet the barriers in application to use those programs.

I don't I don't know.

I don't know if you could we'll be able to look at the from the program to the transition.

We can't we can't look at what we're doing who got utility assistance and what percentage of them.

Not everybody's a homeowner.

So if they're a renter, then it's true.

Then they don't have really control over the things we can do.

But that's not that but that was that's but not weatherization.

Yeah, but we do.

Do we do that through CDBG for rental property?

I think it's just homeowners.

It's owner occupied.

We don't know our utility program that we have that water and light runs.

I asked about that, yeah.

And I still either eligible, still don't know all the details.

Yeah, and so I I the one thing that I can that we can't speak on is we can speak on the programs that we created to try to help eliminate the barriers for people to utilize the programs, and so that's my key to the city, which allows for a little bit more streamlined process, so you only have to go to one source to apply for assistance, and then that allows you to kind of navigate through all our other assistance programs without having to constantly reapply and constantly bring back in for new information.

And so that program is in place and it is an operational.

Are homeowners in that case who would be eligible?

Is that part of the audit report?

Do they show it?

I don't think we got it.

What against an LODR because this was strictly utility assistance.

And there's no question on the utility assistance allocation on as to whether or not they rent your own.

Right.

They just have to be the account.

No, we don't have the data.

Can we for future, can we add that as a question?

Because it helps us audit our other programs in effectiveness of reaching.

Yeah.

Yeah, I'm thinking through like, is there any unintended concept?

That would be discouraged.

So that would be one of my concerns is just making sure that we don't do anything that's going to create another barrier.

Right.

Yeah.

Explore the possibility of adding.

I think explore sounds good, but we should be able to do it based on the addresses.

And rental license.

Well, and the rental license, but I mean, if you're looking for who needs assistance, we should be able to do that based on the addresses.

We don't really need to know if they're homeowners or not.

I mean, you could then look and see which ones need help and then address whether they've got a compliance.

So if you're looking at the weatherization program through CDBG or the ones we did through ARPA, those were all for owner-occupied properties.

And so it's it's that distinction.

I mean, there's we can look at what property received assistance, but it's trying to figure out how do you put that into a program.

And it's just and it's just not a re information that we've captured.

So it's kind of taking a step back to kind of figure out exactly how do you pull that together.

Were those reimbursement or low interest loans?

Remember.

I believe those are reimbursements for the ARPA process program.

Weatherization.

But reimbursement.

Yeah, they're they had to pay up front.

Right.

No, no, no.

No, no, then we're doing that.

No.

The grant pay for it.

Right.

We we paid for the work up to the vendor.

Through the city to the vendor.

Yeah.

Right, through the ARPA funding.

I'm also wondering if uh a good stopgap measure, if not something to keep moving forward, is when someone is applying for some form of assistance from the city, are they also then receiving information about other assistance and resources that the city provides?

Because then there they could be sent the information of if you are a renter, this is available for you.

If you are a homeowner, this is available for you, and here is how they can help with your utility fees in the future.

Do you think that Rebecca?

Yeah, it it all depends, not typically for utility assistance, because this is very much a low barrier.

We don't have a lot of staff time to spend for this particular program because our social services staff are pretty busy with medication assistance and pregnancy um uh case management and all of the other things that they do.

So the utility assistance program is really a paper-based program.

We're looking at your income, we're verifying that you're eligible, and then we're doing the lottery.

So there's not that face-to-face interaction because you're looking at over 800 households.

So if we were to do that, we would have to increase our staff in order to be able to meet that need.

What resources are available to renters who have less efficient houses, or to their landlords, and do we have a way to initiate with the landlords to let them know this is available?

That's a slippery slope.

I know, yeah.

That might be, yeah.

That that sometimes opens you up to landlords increasing prices to tenants too.

I think this is I mean, it's a good conversation, but I want to have the conversation.

I think that's bigger than the budget right now, but it is a good conversation.

Maybe at the next council you're gonna request like a report for that sort of information.

Uh I thought that we had requested for information of this type to go with the discussion on the audit.

Um because we talked about I can I just ask for us to be prepared to talk about um rehabilitation and weatherization programs along with the audit in August.

We can talk about the programs.

I don't know if we can get into the level detail that you're asking for right now, where you're looking at for the number of houses and what houses, because I don't know how quickly we can just kind of pull all that together.

Uh, for the but you're right, we do have a council tracker for that information.

That's all right, right.

You can add it to the council tracker.

I don't think you're it sounds like a lot of this information we don't collect.

Right, and so some of it may be trying to figure out how do we go back and collect on the back end.

All right.

All right, I think you've got two more slides.

Okay, so here are the changes in the proposed budget as well.

So um there's a net reduction of uh 24.45 full-time equivalents or FTEs in the general fund.

Uh 22 of those were moved to the new public communication fund.

Um we had seven new FTE positions added uh in fiscal year 27, but then we got rid of eight vacant positions.

Um to kind of a counterbalance that so it's about two uh positions that were actually uh decreased in the fiscal year 27 budget for the general fund.

Um and then again the public communications was moved from the general fund to its old fund.

And then we have our upcoming engagement opportunities.

Um so we have the another budget work session on Wednesday, uh the final on Friday.

We will talk about our capital improvement plan.

We'll have that public hearing on the 20th.

Uh we have a budget town hall scheduled for the 30th, uh kind of speaking to how we got to the place we're at now.

Um we have a uh bond debt work session on the third.

And so I think that would that's been asked for a few times by council person Peters.

So we we've we've made it.

Is it um question on that one?

Is what is your timing expected on that presentation for that pre-council?

I believe we have an hour and 30 minutes uh for it, and but that's for the both the bond debt and also the presentation.

That's for the bond debt and also any bond debt, and if there were any questions, questions on the general fund on the budget work sessions, yeah.

Okay.

I the reason why I ask is because you know some a few people have floated because we have a lot on the August 3rd.

You were setting like 70 public hearings on Monday uh for that August 3rd meeting, and it's our first budget presentation.

Um so there have been questions on whether or not we could start our city council meeting at 6 rather than 7, just knowing that it's gonna be a long day.

But A, we'd have to know that like before you post next Monday's agenda because you have public hearing times set, but it depends on that work session what time we could start and how long you need.

So if you needed if you needed it to be that if council, you know, if that's if that's of interest to council, we can then we would start the pre-council at if there's no questions on I mean, if there's no follow-up, we can do the follow-up to the budget.

That can happen during the regular council meeting.

Yeah, right.

Um, another way to kind of shorten that is last year when we did the initial uh budget presentation, it was only a presentation, so we presented it and everything was kind of held to a minimal that were held over to the first public hearing.

That's when we had a lot of the more deep discussions.

Uh but this bond, this bond discussion could probably happen in an hour.

Yeah, I mean, we're gonna review the outstanding bonds, and that shouldn't take very long, but then I think a good portion of the conversation is gonna be the new bond to fund the AMI meters.

So I think that's kind of the meatier part of the discussion.

So what's the thought of council on potential like you um so having a regular work pre-council at five, but then having our regular council meeting starting at six?

With the knowledge that August 3rd, because of it being so long, so that we're not getting to I was hoping to be there until three.

You were oh so sorry.

We can leave you there.

So we're so rest of us might want to go home before that.

We can get your blankets.

Okay, all right.

So, yeah, sounds like we're gonna start the August 3rd regular meeting at 6.

Okay.

And pre-council will still start at 5, and we'll probably just be talking about the bond debt.

That's fine.

There's only one resolution setting a hearing for August 3rd.

Okay, so that one can be adjusted.

Okay, the other three were two for August 17th and one for September 8th.

So if you're making any adjustments to those, we need to know before I don't know.

Yes, so you so that discussion can maybe happen on Wednesday when you guys have so it's not affecting to your agenda that you're gonna publish this week.

It is so we can talk about it potentially Wednesday as you're if you guys are wanting to entertain that for those meetings in addition to the August 3rd meeting, then what's the pre-council for August 17th?

Stacy for August 17th, right now.

Um portion of it's closed, and also tentatively municipal campaign finance reform.

Do we have a times assigned to those?

The closed would be about an hour.

The other one, I think it's it sounds like it's gonna mostly be your year all's discussion.

Conversation potentially have until Wednesday to decide whether or not we wanted to punt that you know what I mean.

Like, do we if we want to start that meeting also because is that a long meeting as well?

It depends on what you guys well that's where if it's the first bug but public hearing for the budget.

Correct.

There's gonna be a couple special items, maybe.

Um who knows how many scheduled public comments, six all six spots have been filled up this time.

Um, so I just I just don't know yet.

All of August will start at six.

I mean, would you I mean um so the campaign finance we've been talking about, you know, the potential for forming thing.

Would you guys be okay at holding that one off to start to have a pre-council just be an hour and start that meeting also at six meetings?

Yeah, and I'm kind of looking at 10 minutes.

It's I hate to defer that again, but I also understand there's more pressing issues.

So then we can talk about it by the end of this year.

It might be helpful to know when it would be deferred to because I feel like our council meetings are scheduled out for like 10 months at this point.

Yeah, so knowing that it wouldn't be a year down the line before we bring it back up, um, I think that would be helpful context.

And how many times has it been deferred?

We first started a year in May.

Yeah, we first started talking about it in May of last year.

Yeah, but then we got a report and but this is the first time we would be discussing session at a work session.

Right.

Yeah, yeah.

I don't think we should defer it if we've already been waiting a year for the meeting.

Well, it's really yeah, for our conversation on it, and then what do we want to do next steps?

Yeah, like and I think you had a task force idea of putting together of that.

Um Stacy, what do we have any open uh work sessions or pre-councils?

There's there's also another item on August 3rd that we get kicked back a little bit as well.

Which one is it?

It's the um special event ordinance revision update.

But that's just a 30-minute estimate, so that'll be easier to kind of put in somewhere.

Okay.

What are we doing on September 21st?

Because that's the date that we just approved the budget, but we pretty much have already done the amendments and done all the work for it.

So it would that be a time when we could have a two-hour pre-council meeting.

What's that?

Do you already have something there?

I one of them is flexible, one of them is the 2027 legislative priorities, so that one definitely gets that one could get pushed back, and then uh a closed portion that might be if it's a legislative priorities, like would we have some sort of input that needs to happen in order for that to happen?

Or it's for the state legislative priorities would be able to move it back a little bit that that is without impacting the feeding for the input, I think, right?

Our initial one.

Yeah, we didn't have to.

So as long as we do it before December, right?

Yeah, yeah.

Well, I'm just thinking like staff has to have time to do stuff before it gets filed, I would think.

Yeah, um, so we could tentatively do then the um campaign finance reform on that meeting.

Um so rather than August being September.

Okay, that's yeah.

Okay.

I think then my asked also to the council's um and maybe Sheila, you can reshare with us that report that came to us.

Wasn't it a report?

Are you talking about campaign finance report?

No, I think Nancy maybe sent you guys an email, but I don't believe there was a report.

There's going to be a report, and then it was decided it's better off being a work session.

Okay, I've trying to remind my my memory of these things.

Okay.

Um so yeah, request the council.

So okay, so then we're starting August regular council meetings.

We'll start at six.

We'll have a pre-council at five.

Regular council meetings will start at six.

So for both of those, the additional things that you have that are gonna be on intro for Monday's meeting.

Will those times be updated for when those public hearings would be?

Yeah, for the August 3rd and August 17th meetings, we will change it from seven to six.

Yes.

For September 8th, I'm leaving it.

I say leave it as, right?

Yeah, okay.

Yeah.

Okay.

All right.

Sorry.

I and then you have other ones too.

Other public engagements.

Yeah, so we'll have the the first presentation of the but 27 budget on the third.

Uh we'll have our fifth and final town hall separate dates because we couldn't do the daytime and evening on the same day.

So uh the sixth, I believe, will be the daytime of it, and the 12th will be the evening event.

Um, and then public hearing one and two on the 17th, and then on September 9th, I mean, uh, and then adoption on the 21st.

So that is basically it.

Can I ask a quick question?

On um for the expenditure.

Are there any NDIs that were approved that are using reserves?

No, no.

Okay.

Yeah, this is balanced.

Okay.

Yeah, yeah.

That was just I mean, would I just thinking about last year's budget when we were trying to do some of the and like there were some vehicle purchases that we so I just wondering?

Do we have any sort of documentation or information that I could look at on what risk we know we're we're knowingly accepting by reducing these things so that I can look at the likelihood, the potential impact of that?

Like a risk register or something.

Yeah, I don't think there's a documentation of what the risks we would have.

I think it's more being at no what the delay service would be for our residents.

Okay, but it's that's a risk, right?

Well, I mean that's that's what that's kind of what we present it is no here or what the impact would be for some of that delay.

Well, it's kind of like what Rebecca stood up and said, right?

The case of but I guess the question am I right that you're kind of like wanting that?

Yeah, I mean, we're cutting a ton of stuff, and so I just want to be able to look and understand what that risk is in a structured way so that I can understand what I'm saying.

Yes, definitely do that, or no, don't do that.

Or let's find a rock for that money to pay for, yeah.

I'm not sure there's anything available though.

I mean, like I do risk registers all the time, and like you guys do projects, right?

So there's risk associated with projects because it's the same thing.

And so here are here are basically the uh summarization of the impacts that we will see on the budget.

There may be a few more that we could add in there, but these are basically what we have put together what the impacts will be.

Right.

What if we just I ask you guys to explore what a risk register is and then possibly tell me if that could apply to this.

We can look at what a risk register is and see if that's something that we could apply to.

Thank you.

It's not something that we do in our in our world, but we can take a look at it and see how.

So in years past, um, and once we get into the actual budget presentation and the numbers are before us, you know, a reminder for council too.

Like if there are things that you know are priorities of ours that we're not seeing, is to think about, right?

Is to ask those questions of what would those be.

Um, like for instance, I'm gonna ask more questions about just listening.

So now I've been on this road show with the police and fire chief talking about these things.

Listening to the fire chief talk about that protective equipment, you know, the gear for now we're dealing with wildfires, now we're dealing with some of these things.

Like I will be interested in like, is that something that we could pay find the money for, or it's in res, you know, it's a one-time funding.

But so I remind council like to think about if there are those questions.

And so I think having that information on the NDIs is useful for that, um, as well as looking at ways we can also like cut our own budget and different pieces on that.

Absolutely.

So I also I I know that you've said out loud a bunch of times, like it is a balanced budget.

I really want to highlight, you know, last year we had some employee wages coming out of reserves, and that can be a really scary place to be as an employee because you don't know that you have stability.

And so I just so appreciate the work that y'all put in to get all of that.

I mean, everything, but for me, particularly the employee wages fully into the regular fund fully into a balanced budget.

I mean, that is uh incredible.

So thank you.

And that was and I think you know, coming from the council's priority, that was the first thing we looked at before we looked at anything else.

So we wanted to make sure that we can account for the employee wages, raise raises before we looked at any other NDI, new positions, new equipment, anything of that magnitude.

So that was the top priority.

Appreciate that.

Yeah.

All right.

Hopefully in the council chambers, right?

We will be in a council chambers.