Present.

Councilmember Letitia Johnson.

Present.

Councilmember Mary Waters.

Mr.

Trey, you have a quarter present.

Thank you, Madam Clerk.

That'll move us on to approval of the minutes.

Um, members of the committee should have received a copy of the minutes.

And with that, is there a motion to approve the June 10th, 2026 minutes?

Motion.

It's been a motion to approve the minutes of June 10th.

See no objections to action shall be taken.

Um just I do not have any chair remarks today.

Um, and that'll move us on to public comment.

And we'll open up public comment request for public comment will close at 115.

Please limit remarks to two minutes.

We'll start with those in the room, and then for those participating remotely, please use the raise hand feature, and you'll be called in order.

Seeing no folks in the room, we'll move over to Zoom.

How many folks do we have so far?

Good afternoon, Mr.

Chair.

As of now, we have eight hands raised.

And the first caller being William M.

Davis.

Commissioner Davis, good afternoon.

You have two minutes.

Uh, good afternoon.

Can I be heard?

Yes, you can.

Okay.

You know, I think it would be appropriate, you know, for a future rule as relates, especially the budget and audit, that whenever an administration changes, there should be actually a thorough audit of what was spent.

Because I could very well imagine if y'all did a thorough audit, y'all find out there was millions of dollars that the previous administration spent that they weren't supposed to, and the way that they spend it.

That's all I'm gonna say right now.

Uh I'll also I think that uh we as the city of Detroit could have more control over what's going on, like say it in our restaurants, gas stations, um these food trucks and a whole bunch of other things if we actually have a strong licensing um effort here, and also we can save some money, but also uh I think that we can make sure that these different entities are living up to doing the stuff that they should be doing for the people of the city of Detroit.

You know, because I know a few years back, a number of years back now, I was doing protests at some of these gas stations who were selling um age meat and trying to pass it off as being fresh.

You know, we need to have more inspections because I'm older than both of you.

I remember when we used to do more inspections, you know.

We used to you know know a little bit better what gas stations are doing, what party stores are doing, what restaurants are doing.

You know, we we need to have uh greater control over there, and don't get me wrong, I'm not uh one of those super control freaks, but I think we need to make sure that the public is safe and the public the city has options on closing down bad actors.

Thank y'all, and y'all have a great day.

Thank you, Mr.

Davis.

What I'll also say um hearing you on the audit of previous administration, but um the auditor general does do um all this throughout the year, so if there are any particular places you like attention to, you can definitely let our office know.

And the same for inspections.

If there are certain businesses that are of mine, um please let us know as well, and we will work to get some inspections done there.

All right, next speaker.

Our next speaker has their hands raised twice.

Uh, with the first one being black bag.

Mr.

Crawley, good afternoon.

You have two minutes.

Uh yeah.

Um uh let me take a break here.

Yeah, uh Denzel McCampbell.

Uh I got put off the meeting this morning by Angela Whitfield.

It's Andrew Whitfield Callaway, District 2 representative, because I said something about her being cheated in.

Cheated in, a cheating public official, and then I didn't get a chance to talk about Sandra Smith fully.

She's a uh 105-year-old resident voting in district two.

Now, you are on this committee uh with another cheating individual.

That's Letitia Johnson.

She's over in District 4.

See, Dennis Winfrey, I believe been cheating for 15 years.

I can only prove since 2020.

Yes, 2020, that was Donald Trump was in that election.

He was cheating on here in Detroit, Michigan.

But I can definitely prove 2021.

2022 and 2024.

That's the February 27th United States presidential primary election, which Donald Trump won, but he was cheated on.

Absolutely ballot fraud.

They couldn't stop it all.

They tried to, I don't know what it took place, to be honest with you, to tell you the truth, Mr.

McCampbell.

But you are serving on a committee with cheating in confirmed, confirmed, cheated in officials.

Now the monies.

Now this is what I had a conversation this morning.

We got to talk about the monies now here in the city of Detroit, Michigan.

That's what's gonna get the people and the young black people for once 18, 19, and 20 involved when they find out how much money has been getting shafted from them.

That's uh enough for now.

All right, thank you.

Next speaker.

Just uh for the record, he has his hand raises legendary Detroiter.

Uh next um, but our next speaker is meaningful inclusion of residents and master plan update matters.

All right, before we go to the speaker, Madam Clerk, if you can note that we've been joined by Member Waters.

Thank you.

All right, next speaker, you may begin.

You have two minutes.

Yes.

Okay, thank you.

Yeah, you know, uh, very interestingly enough, Janice Winfrey won't they won't hire me to work the elections, and I speak French, Spanish, sometimes English, and I should have learned Arabic when I had an Algerian boyfriend, but I freaked out at the alphabet.

I blew that opportunity.

Um so I'm wondering why in the past we did not get this financial statement about the solar farms.

Um I don't think the public was fully informed about what was happening, about the financial incentives, the federal money that was behind this.

There was federal money that incentivized the taking of Black Bottom, and also uh when they uh tried to build out at the airport, and then that overturned the pole town case.

Many residents don't even have a clue of what's going on.

I talked to a guy, he thought the housing upgrades, which weren't that great.

He didn't know it had anything to do with the solar farm.

And very politely, the law department committed fraud on the residents by not telling us about the blight definition they were gonna use.

But why wasn't this financial information presented us to us before?

Before I'm glad, Denzel McCampbell, that you remember Chair McCampbell, that we're having this discussion.

I guess the thing about the curfew, you know, delayed this and very politely look up the the negative effects uh uh uh uh uh uh of fireworks.

But back to the solar farms, it's a total violation of the charter to be destroying neighborhoods for solar farms when we could be doing things like the Michigan State solar parking lot, building on land the city already has rooftops, parking lots, instead of putting people through the misery of eminent domain, no right to counsel, rolling over them left and right by a law firm from Farmington Hills that's being paid 7.7 million dollars of our money.

We should have had this information a long time ago.

Thank you.

Thank you.

Next speaker.

We have five hands uh left in the queue, and our next speaker is Betty A.

Varner.

All right, before we go to Miss Farner, um request for public comment has been ended.

Uh Miss Farner, good afternoon.

You have two minutes.

Uh good afternoon, Mr.

Chair, and to all within the sound of my voice.

I'm Betty A.

Barn, the president of the Soda Elsewhere Black Association.

Uh advocating for help for our annual uh a rise Detroit event that will be Saturday, August 1st from 11 a.m.

to 3 p.m.

Our setup time will be at 10 a.m.

And we will be on our um Deba Community Park where we have uh purchase five lots, and we have um created a park for our community.

And on that day, we will have a bouncy house.

We will be giving away food that will be uh resources.

Um we're hoping that DMC will be here, the Wayne County Mobile Treasury Unit.

Uh hopefully we have Wayne Metro and other resources to help people and residents of the city of Detroit uh be successful in their homes.

Uh this is a uh Detroit Metro event, and we will be giving away free bikes, school supplies, uh hygiene products for our children.

But we are in need of a hair braider.

We will be uh having free haircuts, and uh it's gonna be a fun day.

There will be games, uh big with spades, uh dominoes, checkers, and other games we have purchased for uh outside activities, family games.

And so it's gonna be a wonderful day.

Hopefully, we will have good weather.

But if you uh have time and can uh support us, we need volunteers to help us set up and break down our equipment, and we need a hair braider.

Thank you for this time and God bless you all.

Thank you, Ms.

Varner.

And if there are folks who are able to help, please do so.

And hope you have an amazing event.

Next speaker.

Our next speaker is Unpaid D Dot Mobility Access Ambassador Cunningham.

Brother Cunningham, good afternoon.

You have two minutes.

Brother Cunningham, are you there?

You're you're coming in very choppy.

Can you hear me better now?

Yeah, a little bit better.

Um driving through Highland Park.

Hopefully, you all can hear me.

Yep.

31314.

313, 4404, 911.

3134, 914.

I have been helping people directly as well as to the damn warmer gloves, ice water.

I've been doing the kinds of heart.

The house that beat wants you to believe that I am the enemy.

If I was to be against you, the powers that be wants you to believe negatively.

I hands on give from the bottom of my heart.

Maybe they get millions, maybe they get hundreds of thousands.

Maybe they got in where they are because of name recognition, the nepotism.

None of those things have I obtained, but only by the grace of God.

My parents weren't much of anything.

But I am a child of God.

And I give from the bottom of my heart.

I need your help.

A cheaper vehicle, um, a cheap vehicle, repairs to the vehicle that I use now.

Um just the fact we giving our bus tickets at the bus stops.

Y'all want me to be east.

Y'all want me to be west.

Y'all want me to be north?

Y'all want me to be south, all over this great vicinity.

313, 734, 586.

You want me to continue.

And if you want me to continue as the underdog, please help me.

Thank you.

Thank you, Brother Cunningham.

Next speaker.

Our next speaker is Owner Papa.

Ms.

Hughes, good afternoon.

You have two minutes.

Good afternoon, and through the chair, Matthew Heard.

Yes, you may.

Good afternoon.

Thank you.

6.1 is the major issue on this agenda today for me.

Uh, I need Mr.

Um Johnson to come down and explain to me his numbers and how he got them.

We have some huge assumptions, but what's most concerning is that there's parentheses around everything except for monies that come from us.

Um, if you in four years aren't seeing this to be a positive in terms of money um to the city in some type of way, um, I don't think it's a good endeavor.

And the fact that you're changing um contracts, contract terms, these are substantive changes.

And this these are 30-year contracts.

You need to present this in a public hearing so that we can hear all of that is involved.

The original public hearing suggested that the land that was going to be taken was vacant land.

I have the report.

And now on this new report, it says um residential.

We have a lot of vacant land.

We have a housing issue.

So we have a housing crisis, so you tear down houses.

And if it doesn't to you, then maybe we need to have your heads examined.

Because this is crazy.

Why is it that we gonna give six million dollars to Lavonia?

Why are we consistently giving contracts to outside people when Granger is in Detroit?

And if they can't support it, then we expand them.

We find ways to get our people into business to do that business so that we can have them doing business.

This this spend our money on everything except for the people.

Thank you, Ms.

Hughes.

We would definitely dive into the fiscal impact study.

Next speaker.

We had one caller drop.

Excuse me.

We had one caller drop off, so we are on our last speaker, Darren McCluskey.

Darren McCluskey, good afternoon.

You have two minutes.

Darren McCluskey, are you there?

Darren McCluskey.

If you are there, you have two minutes.

Well, we'll have to move on with the meeting, but please do reach out to the clerk's office with your public comment.

All right.

That brings us to the end of public comment.

Uh that will take us to um unfinished business.

Is there all right?

Is there a motion to discuss line items 5.1 through 5.3?

Motion.

It's been much to discuss line items 5.1 through 5.3.

Um, and I believe we have uh Mr.

Washington is Mr.

Washington or Miss Sulliva?

Miss Sullivan is on.

Good afternoon.

I believe we have Arnida Clark and DeAndre Berry on.

Okay.

If we can promote them as panelists, please.

I am promoting DeAndre Berry right now.

Uh if Anita or Nita Clark could raise their hand, that would be helpful.

Ms.

Clark, if you if you can hear us and you can raise your hand, please do so we see them there.

All right.

Mr.

Chair, I'm still not seeing Arnita Clark, but DeAndre Barry is on.

All right.

Well, we pre um chair, she is under Arnita Crusade Clark, are you there?

Yes, I am here.

Okay.

Um if you are able to turn on your camera, that would be great.

But if you're having technical difficulties, it's certainly understood.

Yes, I did turn on my video.

Let me see.

Let me try again.

Thank you for your patience.

No problem.

All right, okay.

All right.

Good afternoon to you both.

If you could just state your names um for the record.

DeAndre Barry office, uh Contractor and Procurement Manager, Office of Contracting and Procurement.

Good afternoon, Honorable Council.

Good afternoon.

So we brought back these contracts because I know myself and members on the committee had a few questions and wanted to get more information on those.

I just wanted to see if we were able to obtain that info.

Through the chair.

Okay.

I'm not sure.

Maybe maybe I'm not sure if your honorable body received it, received a memo.

I don't believe we did, but first year Johnson member waters that you all receive a memo.

It should have come from Mr.

Washington Malik.

Hold on one second.

Oh chick.

One second.

I don't see them, but maybe I'm missing them.

But I sure Johnson member waters, did you do you all see them?

Mr.

Chair, I don't see an email, but I have had several conversations regarding these line items.

Okay.

Well, if you I know I just had a few questions, but um we can move forward for now, Vice Chair Johnson.

If you have any um additional or any comments there.

Thank you, Mr.

Chair.

Um, just if anyone is able to just sort of address the questions that were presented last week.

I know um member waters spoke to the number of Detroiters that I guess that was the overall conversation, the number of Detroiters that work for uh these establishments.

I did have a conversation about Granger um recognizing the size of Granger.

So I'm not sure if you all can just share with the general public.

Um if you know Detroit employment information for the various vendors, um, or if you have any additional information about them.

I believe we did also share with you our job fair that's coming up um next week as well.

Yes, through the chair.

Um fast and all they did um reach out to us because they was on the line and they wanted to have they wanted to know information about the job fair, so that information was sent to them, and the representative for Fast North said that they will be contacting your office.

I believe Miss Strickland to coordinate um to coordinate um the with the job fair.

So that was fast enough response in terms of MSC.

MSC has a kind of it's not an official city of Detroit joint venture through CREO, but they do have a um they have an agreement with um ACE Restoration for this contract, and ACE has 11 employees, and they all are um city excuse me, City of Detroit residents, and the MS for the MSc contract, ACE Restoration will be will be working as they salespeople, so it's kind of like a joint venture or similar to a subcontracting um working like a subcontractor for this contract in terms of um generating business um for the MSc contract.

Does that answer your question?

Yes, thank you for that.

Um, but is Ace Restoration a Detroit-based business?

Yes, ma'am.

Yes, Ace Restoration is a city of Detroit certified Detroit based um Detroit certified business.

Okay, thank you.

And would you happen to have um employment information relative to Detroiters for any of the entities?

Yeah, if I could just add to uh uh what Arnita said, um Granger is a Detroit certified business with eight Detroit resident employees.

Um MSC has 18 Detroit resident employees, and as uh Ms.

Clark mentioned as partner with Ace Restoration, which is a minority on Detroit had a headquartered business with 11 Detroit resident employees.

Um and then Bassinall is the largest distributor of fasteners in North American, and they have three Detroit resident employees, and they have committed to working with uh Detroit at work to recruit additional Detroit residents for new hires, and also as stated as Ms.

Cart mentioned earlier, a desire to attend uh District 4 job fair.

Thank you for that.

And I know last week we were talking about um Granger's size and their ability to manage the entire um scope of work over all three contracts.

Can you all share?

Is there any reason why that is not happening?

Have you had challenges with Granger in the past?

It's it's not so much as challenging.

Um being able to have the versatility that Granger may have an item in in stock, but they may not have the quantity that we need.

So having additional options so that we can um order items or goods uh to get them in time.

Um, and even though they were the low-cost provider, they didn't quote on every single item.

So some of the other companies like MSC and Fast and all, they quoted on those items.

So this gives the city um the ability to make sure that we can ensure coverage and not just be solely reliant on uh one company.

Um, especially as it relates to fasteners, anchors, and boats, which um historically we've been getting out of the state in Ohio as well as out of the country in Canada.

This would move that purchase back to Michigan.

Um, and then also with uh, and then with all of these, these are our as needed contracts.

The amounts aren't guaranteed, they're just authorities.

Thank you.

Um, do we have contracts with all three of these entities currently?

Um the contract with Granger has expired.

Uh, we do have a current contract with MSC, and then this would be our first contract with Fast and all.

Okay, thank you.

Thank you, Mr.

Chair.

Thank you, Vice Chair Johnson member waters.

No question.

Okay.

Um thank you.

Uh just a question on Fort Granger for the Detroit um location for the Detroit station.

I know you said there's eight Detroiters employed.

There, what how many do we know how many total employees they have there?

Um, I do not have that information, but I can certainly check into it, unless you have it already now.

One second, please.

So I believe we just have information about how many Detroiters at the Detroit location.

Got it.

Okay.

Thank you for that.

And I do have the memo.

Okay.

I do have to go through it.

Um I'm not sure if there's a motion on this or with the desired members of the committee to bring back or to move it forward, but is there are there any motions on this?

Mr.

Chair, did you want to um bring it back to allow for an opportunity to review?

Yes, if possible.

I I understand that the Granger what I did glance that um the prior MRO contract is spent, so I don't want to disrupt any city business, but I do want to, since this is such a large amount of money, I would like to um review the memo further if there's a motion to bring back in one week.

Motion.

All right.

There's been a motion to bring back 6.1 through 6.

I mean 5.1 through 5.3 in one week.

Seeing no objections, the action shall be taken.

Thank you.

Thank you both.

And I'll read the memo.

Thank you.

You're welcome.

Good afternoon.

All right, thank you.

That'll move us on to 5.4.

This is a budget.

5.4 is a budget memo for my office relative to the mayor's office.

Um we've been asked to bring back 5.4 in two weeks.

There's been a motion to bring back 5.4 in two weeks.

Um seeing no objections, that action shall be taken.

All right, uh, that'll move us on to 5.5.

This is also a memo for my office for the Detroit Institute of Art.

Um I just want to is there a motion to discuss 5.5.5.

Um Ms.

Sullivan, or if there's anyone from the budget office that can answer this question.

We got the budget memo back, but you know, we had this conversation and the budget hearings were public and the budget process is public, but the DIA had asked that the responses not be added to smart sheet or made public.

So I'm just wondering, is there any type of agreement that the city has with DIA or what is the process with folks who like the DIA when it comes to budget and these questions being public?

Okay.

If there is someone from the or you can come forward.

Good afternoon, uh Matthew Spaith, Deputy Budget Director.

I don't think is that mic not working.

Yes, on, but it's not working.

Okay, you might have to use that one.

Yes, thank you.

Good afternoon, Matthew Space, Deputy Budget Director.

Uh my understanding would be it would still be made public through the smart sheet process.

Um there are various entities within the city that are independent and outside, but I believe historically we would post those responses on the website.

Okay.

So with that, if we could follow if if we can make sure that that is added to the smart sheets, that would be great.

And if there's some reason that it can't, if you can communicate that to my office and this committee, that would be great.

Yes, I believe we are working to put it up.

All right, thank you.

Is there a motion to receive and file line item 5.5?

Motion to receive and file line on 5.5.

Seeing no objections, that action shall be taken.

Um that'll move us on to 5.6.

Uh we've been asked to bring back 5.6 in one week.

So motion to bring back 5.6 in one week.

See no objections that action shall be taken.

5.7 is from my office as well.

This is uh a closing the gap building of Detroit where residents earn what Detroit pays.

We've been asked to bring back 5.7 in two weeks.

It's been a motion to bring back 5.7 in two weeks, seeing no objections that action shall be taken.

And 5.8 from member Miller's office for the Museum of African American History.

This has been received.

Is there a motion to receive and file 5.8?

Motion to receive and file 5.8.

Seeing no objections, that action shall be taken.

And then 5.9 from the legislative policy division uh related to an introduction for claims from the auditor general's awards.

We've been asked to bring this back in two weeks.

So a motion to bring back 5.9 in two weeks.

Seeing no objections, the action shall be taken.

All right.

That will take us on to new business.

This is from the Office of Chief Financial Officer and Office of Budget.

6.1 is a report relative to the fiscal impact of solar neighborhoods project phase two.

Is there a motion to discuss?

All right, there's been a motion to discuss, and I believe we can have folks come forward.

Good afternoon, Sarah Patton, Solar Project Manager.

Good afternoon, Matt Spath, Deputy Budget Director.

Good afternoon.

If you all can go ahead and just give an overview of the FIS, and then we can go into any questions.

Okay.

Would you like me to put on the screen?

Yes, if you have a presentation, yes.

They're promoting me now.

I can start by walking through the scope.

Um for reminder, the fiscal impact statements not intended to convey any statements nor opinions on the advisability of the proposal in front of us, but except for the components that have or may have a fiscal impact on the city budget.

Our conclusion by looking at the contract proposal to shift from LightStar for the three solar sites to DTE is that this solar initiative would have no net fiscal impact on the city budget in fiscal year 2027, so the fiscal year starting July 1.

Um however for future budget cycles, the ongoing costs will need to be evaluated on an annual basis and budgeted accordingly.

For background, the city's previously approved contract with Lightstar for development of the state fair Grash at Findlay and Houston Whittier Solar Initiative sites can no longer proceed as planned.

Rebidding the sites would trigger the loss of at least 30 million dollars in federal tax credits and incur significant project delays and price increases.

As a contingency, the city can amend LightSTAR's existing contracts to allow assignment of these three project sites to DTE.

The Van Dyke and Greenfield Park sites are already managed by DTE, and they are the only vendor positioned to meet the federal tax credit guidelines deadlines.

For fiscal impact, the solar initiative has no net fiscal impact on the city budget as departmental operating savings will negate the gross cost in fiscal year 2027.

For future budget cycles, additional centralized payments will be allocated beginning in fiscal year 2028 to cover the net cost as all sites come online.

The recurring cost for the solar initiative is 1.6 million in net cost in FY 2027, based on 2.6 million in power purchase agreement expenses offset by 1.1 million in sale of solar generated electricity.

Various city agencies, including General Services Department and Public Works, have estimated 1.6 million of FY 2027 cost savings from the solar initiative due to conversion of residential acreage to solar power fields, resulting in a modest overall net savings in FY 2027.

The potential upside from future increases in electricity prices and Michigan Green program credits may further offset some of the incremental cost of the solar initiative and mitigate the need for additional centralized payment budget resources.

We go to the next page.

This shows our financial breakout.

One thing to note here is we show a fiscal 27 through fiscal 30, the four-year financial plan.

You'll see that the gross costs are increasing throughout the forecast.

This is due to the phase in of the following five sites.

State fair in Gratchett Finley would then go online in February of 2026, so about halfway through or for February 2028.

I'm sorry, halfway through fiscal 29.

And then Houston Whittier would be on boarded in August of 2028, which would be in fiscal 29, the early stage.

Uh the cost offsets you'll see um below is centralized payments budget resource need for background.

Um in the city, we budget um we have a centralized payments budget um allocated each year.

Um, what this represents are centralized costs such as insurance, centralized rent, utilities such as electricity, gas, water sewage.

This would have to be factored into those centralized payment budgets and how they're um uh calculated going forward.

So this represents the additional need we would need to factor in to our centralized payments budget.

Um thing I would note is that um even though this project's not factored into our four-year financial plan, we don't expect an impact in the current fiscal year and future budget cycles.

We would need to um update this on an annual basis.

We would need to work with our partners that are um engaged in the solar project to know the latest assumptions on the electricity costs, the timing of the projects going online, and factor that into our assumptions when we do our centralized budget um creation going forward.

Um through the chair, I just want to expand on a couple of things.

Deputy Director's uh talked about.

Um, one factor we did have with the new pricing at DTE, the already approved contracts have a 2% inflator with LightStar.

That is no longer the pricing for DTE, DT will have a fixed price.

So the price we enter into will always be the price for the entire lifetime of the contracts.

Um sites, the land will once it's leased to the developer, so that's about 10 months ahead of when the fields will be done.

It's the responsibility of the developer to take care of that land.

That's why it's offline for the city, and we will no longer have to send resources to take care of those areas because that's part of the lease they have to maintain it.

Um then lastly, the savings we received taking those offline came directly from the departments themselves.

We gave them the areas, we asked them what would it be if you no longer had to maintain these, and they provided those numbers.

So I did just want to throw that out there.

Thank you.

Anything else?

Okay.

Any questions from members on the committee?

Vice Chair Johnson.

Thank you, Mr.

Chair.

Um, just want to make sure I understand this.

So the city, the departmental savings, how do we realize that?

Are we anticipating a reduction in staff?

Because now we don't need as many people maintaining these areas, or like if we still have the same amount of staff, how do we realize an actual reduction?

I believe the savings can be achieved through vacancies within DPW and GSD, where we can repurpose some of the existing staff to other functions and can reevaluate their positional budgets going forward.

Okay.

Um what happens if DTE's rates decline?

Is that factored into this?

Because so there was something that came out yesterday talking about DTE customers saving $700 million on their energy bills because of a federal loan.

Right.

This um fiscal impact is assuming a $70 megawatt hour um electricity cost.

Um obviously pricings can vary over the four years as we know if it were to go down.

I can speak to that.

So the rate we pay to DTE is fixed.

What is not fixed is the credit we receive back.

So that is where the electricity pricing comes in as it varies, we do receive that.

So that is what's sold on the MISO market.

As the electricity need goes up, we actually get a higher price because we're the ones selling that electricity to the customers.

So as the need goes up, we'll get a higher price.

So our credits have the ability to constantly go up or down as needed.

Um, but our expense to DTE will remain the same.

So if their rates go down, so our um the rate that they are charging the city stays the same.

Um their actual rates to consumers reduces our credit increases.

We would probably see that on the credit side, yes, because usually the other big customers are the ones making up for that need.

So they're paying a higher price for the green energy that we're selling on the market.

Okay.

And I think I was a little confused by the net benefit in this information that is shared on the screen.

Can you help me to better understand the net benefit to the city?

Correct.

So what this is showing is the departmental savings kicking in before the sites go online due to that timing of when the site is handed off to the developers.

78,000 you're seeing there, that's really just a largely a function of the savings assumptions against the gross costs.

Um to your point, uh council member Johnson.

Um I think any type of departmental savings, we would need to assess that in future budget cycles to determine their uh resource and how we could reallocate their um resources based on these sites going offline.

So is there a commitment from the departments to make sure that we realize the savings within their departments?

So essentially we're reducing staff their their um levels for 27.

We don't anticipate having to take action.

We think that small net savings there is you know a margin of error in totality.

We will look at this and evaluate it in future budgets, you know, as we also look at the uh the centralized payment need.

And lastly, can you speak a little bit more about the federal tax credits, how that impacts this overall, what what they equate to um and how it impacts the project if we were to move forward?

Yes, through the charity member Johnson.

Um the tax credits require five percent of the projects be committed by July 4th.

So that means a developer would already have to have a contract with us and have equipment to commit to their project to be able to file for the tax credit.

Um July 4th is obviously a date coming up very soon, so not many uh developers have the ability to do that, which is why GTE can take it on.

If we lose the tax credits, it is estimated 30 to 40 percent of the total project costs will be gone.

So that was savings that we included into the pricing.

We would no longer be able to realize those savings.

That is about 10 million per project.

So for the three sites, it's around 30 million.

Um that is the minimum, it would be it could be more if it we hit the 40 percent mark for some of the energy community areas.

That again, we wouldn't be able to define that until applying for the IRA tax credit.

Um does that answer your question, membership.

So, yes, um, but now I have a another question relative to that.

So you indicated that two things need to happen in order for us to receive the federal tax credit.

A contract, which technically we are under uh contract with LISTAR, right?

The other item was to have the equipment.

Five percent of the equipment needs to be committed to the project.

So the yes, panels would have had to be purchased, transformers would have had to been purchased, or um construction would have had to start it, and the IRS defined that as significant construction, which is uh per our council much further along than what we currently have for the three areas.

So does that mean LightStar did not purchase any equipment for uh at least my two projects in District 4?

Lightstar did indicate they purchased uh equipment, the the equipment they purchased cannot be transferred, and again they told us they can no longer develop the projects.

So we never saw proof of what they purchased, but they did indicate that.

So I have some I have some more legal questions around all of this.

Um, and I wonder if we would if we decided to move forward if we could utilize the fact that we are under contract with LightStar and they have equipment to be able to get the federal tax credit to allow us a little bit more breathing room to address this because my first thought, and I know we're gonna have this conversation next week, um, is why not after we get the tax credit, why not um proceed with opening this back up for others to be able to pick up where Lightstar is leaving off.

Um, but to avoid to avoid having to walk away or walking away from the federal tax credit.

We can check those two boxes.

If we were to proceed checking those two boxes and then some things change, they shift a little bit.

Is that not applicable?

Well will we not be able to do that?

Uh through the chairs.

So I yeah, as you indicated, we will be talking more next week, and um our office is currently going through a detailed legal update to provide for all of you.

Uh through our legal outside counsel, Valerie Brader for our clean energy expert.

The IRS guidelines specifically talk about transfer of equipment and that it can't happen.

Um we can't transfer from one developer to another, it will know the it date of the equipment purchase.

So that unfortunately is not an option, even though Light Star purchased it, it would have to be Light Star who then completes the development of the project.

The credits cannot be applied for until the construction is complete.

So they would have to fully construct the project, then apply for the credits, and then they receive it.

Um DTE's ability to uh provide the five percent is their own equipment.

That is their they they purchased equipment prior to even knowing any of this for various projects they have, and they are able to commit five percent of the equipment they already purchased to this project.

So then, and I'm sorry, Mr.

Chair, this is my last so then does that mean Light Star could actually identify a subcontractor, if you will, to do the installation.

That was one of their new business model plans.

They can sell this project as they will.

They during that those conversations we had, they were requesting an even higher price than what DT is requesting from us in order to then subcontract with someone else and basically assign the project, which we um Valerie Brader, our outside counsel still was not sure if that transfer would apply, but that was a conversation, but it again it was much higher pricing at that time.

All right, thank you.

I'll have some additional questions next week.

This is very challenging for me, especially recognizing that two of the three um um areas are in district four, and I know there are a number of commitments that we have made to residents that have not been fulfilled.

Residents are still on the line waiting for the improvements to their properties, um, and that's the that's what makes it challenging because I certainly don't want us to to renege on any commitments that we've made, especially to our residents, um, but I do not like the way things are are playing out here.

Um so I'll I'll have additional questions next week.

Thank you.

Thank you, Mr.

Chair.

Thank you, Varsha Johnson.

Member Waters.

Yeah.

I um thank you.

Good afternoon.

I've just been trying to wrap my head around why Life Star decided to I mean basically stick us up.

Um through the chair to Member Waters.

They they were acquired in December, which is where the change of business came from and and then they wanted more money from us so that they can get subs to actually do the work, but didn't they know in advance that they could not do it?

I am that is that is just ultimate deception through the chairs, member waters uh the administration agrees with you.

We were just as blindsided.

Is there anything that we can do to penalize them?

Um because this is just unacceptable actually, in terms of the way that they handle this whole thing.

Um through the chair, I believe legal, so uh corporate counsel is currently working on all the options to provide to all of you, so I would I would wait for his um summary.

Yeah, I I'm certainly anxious to know um about that.

So uh I won't say what all of this sounds like.

I'm gonna say it out.

I'm gonna not gonna even say it out loud.

So but anyway, um thank you.

It's pretty it is pretty frustrating as my as member Johnson says, you know, there are people waiting for the upgrades or whatever they want to do that they you know what you know, whatever that deal was with their particular home, and we don't want to leave them out there just stranded because um they decided to bail on us uh slash try and stick us up.

So um and it does make it make it a a bit more difficult uh to decide.

So I'll I'll have to keep the residence in mind as I under my decision.

Thank you, Mr.

Chairman.

I don't know what else to say about it.

Yeah, thank you, Member Waters.

Uh a question on through the conversation that we've been having.

So did we did Lightstar purchase that equipment with the funds that they got from the city?

Through the chair to you, council pres um, the as a requirement of these contracts, the developers had to do all upfront costs.

None of the the the city has not made any payments to any of the developers.

Okay.

The only money that has left the city is for pre-construction.

So for us to buy the homes, demolish, and level the land, um, that is the only funds we have used.

Okay.

All right.

Um, and then thinking uh on the fiscal impact stu uh study, you mentioned the no fit no net fiscal impact, um, but also that the on the four-year table, it shows net cost of um 478k, then 3.21, then 3.29 million for fiscal year 28 through 30.

Um, with the footnote saying that this represents a future budget resource needed to support the cost.

So it it might read it, and you can correct me if we're wrong, it it doesn't appear to be budget neutral on this phase.

So, how does the administration plan to receive new centralized payments uh resources of that mat magnitude to begin it in fiscal year 2028 for this?

Uh correct.

So your interpretation is correct in the current fiscal year.

We don't anticipate an issue in future budget cycles.

We will need to account for this.

I will note that when we do centralized payment budgeting, it really is truly a zero-based budgeting approach.

We have to get the the latest data in terms of our rent or electricity um insurance assumptions.

Um so when we look at that centralized payment budget throughout the four years, even though it did not include this, um, we have to reset it every year anyway.

But to your point, this would put additional pressure um to budget for our centralized payments um for magnitude, our centralized payments budget is around 31 million dollars.

So this would um increase that if those other centralized costs hold steady, but we do see fluctuations and um rite sizing and uh adjustments on an annual basis um in terms of that budget line item.

Thank you for that.

Yeah, uh if that is if that holds true, 10% is a that's a substantial amount.

Um in that uh another question, we talked about the uh federal tax credits.

Um so the city would be the entity that captures those credits, is that correct?

Yes, that's correct.

We in the pricing that we receive that fixed pricing, the credits are already captured.

And in current federal policy, if we were to meet everything by July 4th, is that secure or is this something that I just want to make sure that three months later the current administration doesn't say oh we're gonna avoid those?

No, it is secure.

Once we sign our contract with DTE, which is approved by the MPSC, they cannot change the rate.

So whether they do their due diligence to secure everything to get the credits uh through the federal government, it it does not affect the city.

We are still secured in our rate.

Okay.

Oh, no, on the on the rates, right?

So that's including like if as you mentioned the aspect on or correct me if I'm wrong in this, because I'm still trying to uh understand both sides of it.

On the aspect of we're selling the energy, as you mentioned to Vice Chair Johnson, and you said the credits would cook in to if it's lower or higher, that aspect the federal government wouldn't be able to take that back.

Right.

Okay.

All right.

And on the electricity sale side, I know the 70 dollars per megawatt um is mentioned.

You is that is variable, right?

It will change, it varies, okay.

And if it falls, because I heard your example, if it rises, what would kick in?

If it falls, what is the city's exposure there?

Uh through the chair.

So we budget our expense.

We are aware that the revenue fluctuates, so we're we're truly not even entirely banking on that.

It's it's pure upside.

Um, so the the cost here is the expense with the average of 70.

Um, so there's really no like the credits are just uh additional revenue would we would be receiving.

Okay.

All right.

Um those are all the questions I have for now on the uh Vice Chair Johnson.

Thank you.

Um I just have one or two more questions.

So relative to Lightstar being sold, I guess, as a company, um that that still doesn't negate the fact that there was a contract with them.

Um so did they they indicated that they were not able to within this acquisition still abide by the contract?

Do we have any specific details on why?

Uh through the chair, they indicated to us two things.

One that they could not um complete anything at the current price, which if you recall in the fall, we that's when we brought that to uh this body's attention.

Um and then in April they indicated they are not able to build or develop the projects because that's just no longer their line of business.

And um, I'm not sure if you know the answer to this.

Do you know if there was anything that we did that prevented them from being able to move forward whether before or after um the sale or the acquisition of the other company?

Um, through the chair, not to my knowledge, there they were on the same timeline as DTE and everything was moving as smoothly as our original timelines that we presented at the start of the phase one and phase two contract proposals.

All right, thank you.

Thank you, Mr.

Chair.

Chairman.

Thank you, Vice Chair Johnson Member Waters.

Uh thank you.

Um I guess it it does concern me the fact that we um then send these out to be it.

Um is it timing?

What what what is it the you know the fact that we just transferred everything over to DTE?

Uh through the chair, yes, it is timing.

Um the time it will take us to do a bid process will not allow any other developer enough time to secure 5% that is needed for the federal tax credits.

So even from our initial bids, we would be receiving prices 30 to 40 percent, well, at least 30 to 40 percent higher to put it back out to bid as of today.

So our federal tax credit is five percent.

How often are these credits available?

Do you know?

Uh uh because of the new federal administration, they are no longer um available after the July 4th deadline.

So we have just these projects once they're completed to apply for them.

And will this affect the uh amount of money that LightStar um has agreed to fix up the uh the homes?

No.

The the neighborhoods will remain at their allocated amounts of minimum 15 uh maximum 25,000 per house.

Can we absolutely count on DTE to honor the agreement with the residents?

I mean, can we through the chair?

Just speaking for myself, we we are already actively making sure all the residents are accounted for and communicated with, um, and it's been stressed from the administration that this that cannot be a ball that's dropped.

They must receive their upgrades in a timely manner, and they must all receive what they were already promised.

Okay, so whatever agreement, contract agreement we have with those residents, it must be adhered to.

Correct, they will be upheld.

All right, I hope I don't get a call saying that it wasn't upheld.

Uh I I gotta tell you, it's one in one and you know, it's bothers me when when residents are frustrated, it does.

I agree that it the residents are our number one priority through this transfer.

Okay, all right.

Thank you.

Mr.

Chair.

Thank you, Member Waters.

Vice Chair Johnson.

Thank you, Mr.

Chair.

One one quick last question.

Um, so there were some properties in Gratchett Finley that had already received improvements.

Is that at the the expense of Lightstar, or are those expenses now going to be part of the subsequent contract?

Uh through the chair.

They they were at because again, LightStar and DT had to do their own upfront expenses for that, so they were incurred by Lightstar.

Uh as talked about in our contract amendment, DT and Lifestar will have their own assignment.

That is where DT will be paying life dark for those their costs as part of their own acquisition of these projects.

Thank you.

Thank you, Mr.

Chair.

Thank you.

I will talk more.

I know this this issue on the fiscal impact statement.

Will be further next week.

But I as we you know we had this conversation in public health and safety around this and the time and aspect.

Like I certainly understand the time aspect, but also what has been shared with us that we we had indication that Lifestyle had problems much earlier on.

Um so that that's a that's a major question for me on why didn't we move to protect ourselves um earlier on than to be you know now we're facing a two-week deadline to have a contract amendment?

And I would just say this.

This is Denzel McCampbell speaking.

Um, the entity that a lot of residents have issues with uh so that's that's where I am right now on this, but that's the conversation for next week.

Um with that, uh, is are there any further questions?

Mr.

Corley.

Uh really no questions.

You all raise some wonderful questions.

Um I just would ask the budget department to work with us, you know, in future budgets to kind of bird dog, you know, the um the changes in pricing and whatever changes in cost, you know, if it's a major impact on the budget, please let us know so we can convey that to city council when um the budget um when uh this is the public lighting department, right?

Yes, basically so you know when the public lighting department comes before city council doing future budgets, if there's any major fluctuations if council you know approves this DT contract, we would like to be informed so we can um inform you all and keep you up abreast of what any major price price changes might occur or cost changes.

We're we're in agreement with that on given the the variable rates, it would need to be an annual, it's not something we can just plug in and let it ride for multiple years.

We'd have to reassess it annually.

Okay, thank you.

Thank you, Mr.

Gorley member waters.

Yeah, just something quickly.

Um this was a a no-bid contract with that's going to DTE.

I mean, were there other contractors you could have very well reached out to that could do the same thing?

Um through the chair to member waters.

They they were originally bid, so that's it was two vendors they had contingency.

Yeah, so this was an open and competitive bid that we selected two vendors for.

Okay, all right.

They had uh had uh submitted a bid before.

Correct.

All right, but then that makes sense.

Thank you.

Thank you.

All right.

No further questions.

Is there a motion to receive and file 6.1?

Motion.

The motion to receive a file 6.1.

See no objections, the action shall be taken.

Thank you both.

With that, that'll move us on to 6.2, a report rather to the financial report for the 10 months ending in April 30th, 2026.

Uh is there a motion to discuss?

Oh discussion.

It's been a motion to discuss 6.2.

Uh we have folks joining us now.

All right, if you want to.

Once again, uh Matt Spaith, Deputy Budget Director.

Thank you.

Valerie Agoy, Deputy CFO and Treasurer.

Thank you.

The floor is yours.

Okay, so we'll walk you through the financial report for the 10 months ending April 30th of 2026.

Our table of contents, I just walk right through.

Um start off the the good news that we have is that we received two credit rating upgrades from Moody's and SP in April.

Uh Moody's elevate the city's issuer and general obligation unlimited tax ratings to um A3 from BAA1, and SP also raised Detroit's unlimited tax general obligation bond rating to triple B plus from Triple B.

So it's one step below the A category.

Um both agencies are also assigning us a stable outlook, which we are um happy with considering the economic uncertainties that have uh taken place over the past five to six months.

And I would like to you know just congratulate the administration and council for their continued efforts for financial discipline that resulted in these upgrades.

The next slide is showing our budget versus actual uh first section here is our April period to date, budget and actual variants, and our year to date through 10 months.

Um major um takeaways I would like to emphasize as we go through it.

As you can see in municipal income tax, our actuals to budget in April show an underperformance of 3.4 million.

This is consistent with our revised uh income tax revenue forecasts that we've um adjusted downward in the February conference, and I'll soon to um explain our May revenue updates, and you can see our year to date is showing that negative uh 17 million.

That's largely due to the corporate income tax um losses from the time of the adopted budget.

Um other um takeaways are state revenue sharing.

I believe this is our um is this our statutory or is our constitutional?

Both both, yep.

So reductions in there.

Um our other revenues, this is largely due to um calendarization and timing um with our um interagency billings and reimbursements that come in later.

One second.

Okay.

If there are folks on the soul, if you can make sure yourself is mute to mute it.

Oh have any stopped, I think.

Okay.

All right, you want to proceed to um for our expenditures, um, nothing um substantial on the sales and wages and benefits.

Um they're running uh pretty close to our budget projection.

Um we still continue to see uh timing of purchases versus budget when it comes to our professional and contractual services, operating supplies, and operating services.

So we're continuing to uh monitor the activity um through year end.

And um year to date, we're showing a positive variance of uh $30 million on revenue and as well as on the expense side.

So take us to our projection slide.

Um for reference, uh budget column A is our current amended budget.

The projection column B is our forecast on where we expect our revenues and expenses to end on in fiscal 26.

I will note that column B has been updated for the May revenue update.

You'll see that we are assuming a positive upward um revision of 17 million dollars compared to the March report.

That is a positive swing of uh $30.8 million dollars, and that's largely due to $14 million gain in our forecast for municipal income tax and a $4.6 million gain in our wagering taxes, and we also have a projected $13.6 million uh increase in our projection for other revenues that are largely investment earnings that um our Treasurer Goli will go over uh shortly.

Um thing I would like to note on this is if you recall the 42 million dollars we put in reserve back in the fall for the corporate income tax reserve fund.

We do not anticipate needing that money thus far in fiscal 26.

Um what I would like to point out is that 42 million.

If you look at our municipal income tax variants from our projection to budget, it's a loss of 43 million dollars.

Um so I think that still demonstrates that it was prudent and um wise to set aside that money at the time if it weren't for our wagering tax upside that we continue to see largely in internet gaming and um strong market investment returns, that money would have needed to be required to um make up for the income tax losses.

Um I'll do the expenses and then yeah, before we leave revenues, Mr.

Corley had sent questions ahead of time for a little bit more detail.

So um he had asked on the income tax uh the projection increased by 14 million as Matt talked about.

And that's primarily made up of corporate income tax.

We're estimating that those revenues are going to come in $10 or $11 million higher than what we estimated in February.

And we're also estimating higher tax compliance offsets, which are when the State of Michigan in administering our city income tax, they have an agreement with the federal government, and they can offset federal and state tax returns if an amount is owed to the city from a prior year.

And then that slightly offset by increase in estimated revenues and I'm sorry, estimated refunds and a decrease in the estimate for partnership revenues.

And then Mr.

Corley also asked for more detail on the projected higher estimate for wagering of $4.5 million.

And that is we're estimating approximately $4.6 million more resulting from internet activity.

That's both sports betting and what do we call the other one?

Gambling, I can't think of what it's called.

Gaming, yeah, and sports betting.

And then we are estimating compared to February that retail activity will go down by uh will be about $1.4 million less.

And then as Matt talked about state revenue sharing, this was something that came directly from the state's revenue estimating conference that they held in May where they revised their sales tax revenue downward.

Um related to the change where sales tax is no longer collected on fuel.

Instead, there's the fuel tax.

And then you you talked about uh higher earnings on investments than what we had projected in February, and that was primarily uh what made up the other revenues increases.

And thank you.

And to move along to expenditures, um we updated our expenditure projection as well alongside with the revenue projection.

I'll note that the expense projection has been flat or not updated since the November monthly financial report.

So this represents kind of the first update since that period.

Um we are showing roughly a 5.1 million lower projected ending expenditure balance compared to the prior monthly financial report.

It's primarily due to a more modest assumption on where our salaries and wages will end.

Um we originally assumed a 10 and a half million surplus, it's lower to 5.6.

Um, this is something uh Mr.

Corley also asked um in writing.

Um part of the explanation for this is uh the previous projection was based on five months of actual activity.

We now have 10 months, and um one of the things I would also like to point out if I were to roll up to the previous slide is our current year-to-date variance is roughly $7.2 million.

It's a little higher.

We want to kind of hedge on the conservative side in the event um, you know, there's overtime activity in the um May and June months in our public safety and in recreation departments.

Um that's part of the um rationale there.

I would also like to note this is another um question Mr.

Corley raised, was in respect to professional and contractual services.

We are showing a $17 million variance year to date.

Um admittedly, this is um you know, a difficult expense category to project because it's largely there's a lot of noise in terms of when bills are received, when we receive invoices, when services are rendered.

Um one thing I would like to note though is that um even though we have a $17 million variance, our projection is only showing roughly a $1 million ending balance.

Um we want to kind of take a more cautious projection on this front.

I will note that if you look at the actuals of $86.7 million, if we were to compare that to April 2025 through 10 months, and last year it was uh 66 million.

So we have seen a greater number of contractual service activity this year through 10 months than last year.

The budget projection last year was also around that 103 million.

were to compare that to April 2025 through 10 months and last year it was uh 66 million so we have seen a greater number of contractual service activity this year through 10 months than last year the budget projection last year was also around that 103 million um so this is one where we we do want to continue to monitor um the rain the remainder of the fiscal year look through the June period and kind of get a better um sense of where these expenses are landing through the adjustment period um that'll take place after June we go to our amended budget reconciliation um page there has been no change uh from the prior month on this um slide uh what you're seeing here are the continuing appropriation amounts um those have remained flat um in terms of the budget authority from uh March to April our next slide here just want to make sure this is visible on the screen this is our employee count monitoring um April was a strong month for hiring you can see here until in terms of the total change there's been an increase of 233 um filled positions uh the major um movements that I walk through is in police uh increase of 63 we saw this uh primarily in our uh student uniforms um we also if you were to look at um public works there's an increase of 16 full time general services seven um b seed transportation it's largely students um what we've noticed in police is an increase in um emergency service deployment operators month over month our theory is on some of these increases in positions are from some of the large uh labor contracts that were ratified in the fall particularly on AFSME um when those contracts are ratified they included um you know in many cases targeted market adjustments our theory is you know those were largely implemented and phased in January and February then they've since you know rolled into the job posting since then so I think what we're seeing there on the the positive month over month gains in employment activity um may have to do with the um more competitive wages that allow us to hopefully fill um you know some of these department vacancies um and then overall our position over under budget we're still you know under budget um or flat across the departments um some other changes seasonal part time we're seeing an increase of uh 69 positions month over month that's to be expected as we're transitioning into the summer months and I'll hand it off to our uh treasurer to go over the remaining slides so on the slide for income taxes um as you can see withholding compared to this time I'm sorry thank you um the slide on income taxes uh if we what we're doing here is comparing where we were at this point um last year and so you can see the withholding is up individual is up corporate is down and partnership is down um in uh overall we're up by 15.6 million I do want to make sure I know sometimes this slide is confusing compared to um when we look at the other slide where we're doing our annualized budget versus projection where it shows um the variance of 42.7 million and then we look at this and say hey we're doing better than we were at this time last year and the reason for that is the on page five the annualized budget versus projection column A the budget is based again on the um February 2025 estimate of corporate income tax and overall um uh income tax so that's why even though we're doing better than we were at this time last year we still uh have the shortfall in terms of the expected revenues at the time the fiscal year 26 budget was developed the next slide is cash position um there's really nothing remarkable here operating cash activity um uh this is our team that estimates uh our need for cash inflow and outflow and um there's nothing new here and then accounts payable slide number 11 I do want to make sure it's a typo at the top it is for April 2026 and you can see in terms of aging for the current month they only have two that are 31 to 60 days and four that are more than 61 days and for the four the reason two were on hold per law um one was a credit invoice and one was on hold but has since been paid and that concludes our presentation thank you both so much uh we'll start with questions from members of the committee member waters okay thank you um about 70 percent of um residents work outside of the city is that right what's the percentage about 70 percent I'd have to look it up I'm sorry don't

And that concludes our presentation.

Thank you both so much.

Okay, thank you.

Um about 70% of um residents work outside of the city.

Is that right?

What's the percentage?

About 70%.

I'd have to look it up.

I'm sorry, I don't have it.

Well, well, I uh Mr.

Chairman, I'm gonna be asking for a a report um that identifies the number of people who literally who live residents um who work outside of the city and what would that economic impact be?

I so that that is my motion, and we will follow up with a memo.

All right.

There's been a motion made to get a report on the number of folks that are of Detroiters that are working outside the city and the economic impact that has on the city of Detroit.

Uh any objections?

There's discussion.

Um okay, discussion.

Uh no objections for me.

I will also say I think that goes hand in hand with um the line item.

We have we have a memo on how do we actually reverse that trend and get folks in.

So I think that goes that compliments that as well.

Um but send objections that actually shall be taken, and um member waters will follow up with a memo.

Okay.

Um you have um you said you had a hiring uh increase.

How many uh were um Detroit residents?

That's something we would have to work with HR on to see of those gains what the um resident status was for those employees.

Okay, I guess that should be another motion then.

All right.

Um motion um should we ask HR directly or will you do that?

Should it be to you?

I would um I would direct it to HR.

Okay, their payroll would be able to provide information.

So Mr.

Chairman, I'm gonna ask that uh I'm gonna make a motion that uh human resources um uh break down the numbers that were Detroit residents uh with this uh within this hiring increase.

Okay.

Do you want that to be for the year total?

I think if you were to ask like hires from April 1st.

From April 1st.

And outward, that should get you okay.

April 1st, 26th, 2026.

Um that would get you kind of the that's what we saw the the biggest increase.

Yeah, that'll show you kind of the yeah.

I would be curious.

Um so yes.

Okay.

There's been a motion made to have uh the HR department provide the residency status of folks who were hired in the month of April 2026.

See no objections that action shall be taken.

April on, yeah.

Okay.

And I would, and that's actually a good point.

For if it is the will this committee, if if there are ways as we prepare these uh the numbers and the variance and hiring, if we could work to get that breakdown in these reports, that might be beneficial if that is or would that need to come from HR.

Um in terms of the employee count, that would be a challenge based on the data as it's currently uh presented and um organized within OCFO.

We don't really have access to the uh resident status of it so it may be with this motion and member waters if you are inclined in your memo to just ask that they provide that to us on an ongoing basis.

Okay, yes.

Um so whenever they come back to do their monthly report.

Well, that would be for HR.

Oh, for HR, okay.

Yep.

All right, yes.

So I'll I'll um amend my motion to include um ongoing report and in terms of that data.

Yeah, I think you said ongoing.

Yeah, that's it.

Yeah, you said ongoing.

Okay, all right.

Okay.

Thank you.

Uh Vice Chair Johnson.

Um, thank you, Mr.

Chair.

I believe that'll go through IOS.

I don't believe that particular report will come through BFNA.

Okay, well, yeah, it can go through there.

We have to submit a memo anyway.

So I'm sure it will be directed to IOS.

Right.

Maybe, maybe not.

LPD Will it folks for LPD no?

Mr.

Chair, um really not sure.

Um, but HR typically is an IS, you know, um issue.

So I wonder is there a way is there a way we can request, you know, the council can request for Ms.

Starr to send the report to budget financial audit.

Rather than going to the do so in our in our memo if through you, Mr.

Chairman.

Um with uh within our memo uh to them because I think it's very important that it comes comes here, that type of data.

All right.

Thank you.

Um any further member waters?

No, okay.

I do have a few questions here.

Um the wager and tax, as we're thinking about future budget planning, and I know there are some factors here we talked about on wagering, um, that there's you know with the state action as such.

Are we treating the the increase that we see we're seeing in this fiscal year as a temporary peak, or are we treating this as we expect these levels to continue through for both 27 and 28 planning?

For we during tax, um we are expecting just a small um increase each year.

Okay.

Uh the increase that we made.

I know um Erica um our economist that works on this, said that she's used to coming back in May, and you know, there'll be a big increase in compared to what we've seen in the past, this is relatively smaller, but it's still an increase, the four and a half million.

Okay.

Okay.

And I know this is for this still fiscal year twenty-six, and um we and there's a memo that we're waiting to hear back on, but since we have you at the table when we're thinking about the marijuana wholesale tax and the news that the um the state revenue there they did not get as much as they're you know, I'm trying to line this up because the state is they they put this in their current fiscal year budget, but as they're seeing the the revenue from the host the marijuana wholesale tax is much lower than what they anticipated.

Um so and you know, we are not yet into the fiscal year 27 budget where a lot of our street fund and such is dependent on that.

How have you all been planning and looking at those numbers and thinking about our upcoming budget?

It's a great question.

Um the mayor wanna wholesale tax money that would support our neighborhood road funds for the fiscal 27 budget.

I believe we did not factor in that revenue.

Um we will continue to monitor it and as it comes in.

Um take a better look at it.

Um part of the rationale behind that was at the time there was the the legal case that um was brought up around January that was you know right in the midst of doing our revenue forecast.

Um of the other challenges um were the um you know kind of monitoring how those collections look.

Um but yes, they we've um our team uh treasury the four the uh the revenue analysis team is continuing to uh track this um and we'll keep it in mind for our upcoming you know September conference.

Thank you.

Yeah, um that is something that I came woefully under.

So uh definitely, and I look forward to the answers on that memo.

We we'll go into more questions on it, but uh on the state revenue sharing, um it's the projected to be 8.7 million under budget.

Um do we know what is driving that and also thinking about the exposure there of and I ask this uh quite often uh potential changes, and do we have we heard of any potential changes to the formula as the city is going as the state is going through their budget negotiations currently?

I can say high level that reduction you're seeing is a result of the enacted state budget back in the fall that repurposed state sales tax gas tax revenue um to um different funding sources that had a that impacted the um the constitutional revenue sharing uh by lowering the the sales tax base that has been um accounted for in the the twenty seven budget and going forward.

And do we have we heard any and this might this might be for the Governor Affairs office, um, but have we heard any indication of changes to that formula or anything in the upcoming budget?

I don't believe so.

Okay.

All right, hopefully it stays that way, but we'll see.

All right, uh that's the end of my questions.

Is there oh Mr.

Crowley, my apologies?

Oh no problem.

Uh thank you so much for the responses to our questions.

Appreciate it.

Um, just on a on a positive note, it's good that it's looking like we're not going to need to use the 42 million dollar corporate income tax reserve.

Um that's that's positive.

And and it's helping to um possibly generate a decent amount of a surplus for you know end of June as of June 30, 2026.

So that's a positive thing.

So I just want to highlight that.

But thank you.

Thank you, Mr.

Gorley.

Uh definitely a positive.

And I'll also say as we start out, no, we went to the numbers, but uh definitely great news to see on the credit upgrades as well.

So I want to highlight that also.

So thank you all.

See no further.

Is there a motion to receive and file six point two?

Motion.

It's been a motion to receive and file six point two, send no objections that actually shall be taken.

Thank you all.

That'll take us to 6.3 from the legislative policy division.

A report relative to the request for information on the American Rescue Plan Act funded programs.

Uh is there a motion to discuss?

Motion.

Thank you, Mr.

Chair.

And um Mr.

Rasetano is going to call up the report that we uh did for the council.

And um he calls that up, then we can proceed.

Okay, great.

So um as as we know, uh council member uh McCampbell requested for LPD to prepare a report on what American Rescue Plan Act or Opera funded programs currently exist, when they are terminating, uh costs and personnel associated, and which other ORPA programs can be funded by the City of Detroit General Fund.

And so uh this report that you're seeing on the screen represents our um responses to that.

I really want to thank um Terry Daniels, director of the Office of Development of Grants, and her team for providing um the detailed information for this report.

And um she agreed to maybe be available in case council members have any specific um questions on the Opera projects.

So on page one of this report, um you will see 12 ARPA purposes uh that include total expenditures by purpose, and so when I say purpose, that's affordable housing, blight, central services, community engagement, economic development, health, housing, uh, information technology, jobs, neighborhoods, public safety, and recreation uh and culture.

And um of the 827 million in opera dollars, about 740 million of that was spent as of May 18th, 19, I mean I'm sorry, 2026, um, which um leaves about an eight eighty-seven million dollars in remaining opera funds to be spent by December 31st.

And so we can go to page two and um scroll down to three, but page two and three provides a more comprehensive list of the individual ORPA projects under the 12 um opera purposes that I just talked about in page one.

And so tables one and two of the report respond to council member member McCamba's request on what opera funded programs currently exist.

Now we go to pages four through seven, and you can scroll down, please um from page four through seven, and this is table three in our report.

So on these pages four and through seven, um they provide a status of the current listing of opera funded programs as of May 18th, and there are 139 Opera funded programs.

And this table will also respond to additional concerns raised by Councilmember McCampbell.

So one of those questions that Councilmember McCamillo had was which opera funded programs are terminating.

And so table three indicates that for the 139 Opera funded programs, it shows table three shows which program is complete or in progress.

That's in page three, and using the uh 12 opera purposes.

Uh if you can please scroll down to page nine.

So from pages seven through nine, by the 12 OPRA purposes, I do give a status of whether the project is completed or not.

But I want to give you just a summary for the sake of time, which is on page nine, and the summary of the status of the 139 Opera funded programs.

81 projects have been completed.

One project will be completed by May 30th.

21 projects will be completed by June 30, two projects by July 30th, three projects will be completed by July 31st, 8 will be completed by September 30th, one project by October 20th, one project by November 30th, and 14 projects will be completed by December 4th, and six projects will be completed by December 31st.

Now there's one project that would be completed by April 30th, 2027.

And I know that we've been told time and again that all of the Opera projects have to be completed by December 31st of 2026.

But the one project, which is Central Services, federal government, U.S.

Treasury does allow municipalities to close out the pro the projects using administrative services.

And they give municipalities through April 30th of 2027 to close out the projects administratively.

And so that's why there's that one project that has an end date of April 30th, 2027.

So based on this summary I just gave you, 81 projects of the 139 Opera funded programs that represents about 58% has been completed.

When you add the 35 Opera funded programs that's going to be completed between May 30th and September 30th, that means by September 30th, 116 projects or 84% should be completed by September 30th.

Meanwhile, the administration is extremely confident that all Opera funded project dollars will be spent by December 31st, 2026.

Of course, with that one exception for the central services or administrative services that can be spent by April 30th, 2027.

And so while reviewing the information in Table 3, we in the LPD noticed that there were some late end dates, you know, when the project would be complete.

There were end dates such as October 20th, November 30th, December 4th, and December 31st.

And so we inquired about this, and the Office of Development and Grants responded by saying projects that are showing and dates after November 30th are APRA staffing costs that has the responsibility of processing final payments and closing our projects.

Any event that any contract needs a council approved extension before December 31st will be brought to City Council for approval.

And we kind of seen that now, you know, as council has uh agreed.

Um in fact, if that was before you yesterday, there was a um request to uh reassign dollars to to other opera projects to make sure that we spend these dollars um by December 31st.

Now we can uh look at pages nine and 10, and we can scroll down to page 10.

Councilmember McCambo wanted to know the cost and personnel associated with the Opera funded programs.

And table four of the report shows a listing of projected ARPA staffing costs through December 2026.

And table four indicates that there are 248 active ARPA employees with a cost of approximately 10 million dollars associated with the ARPA funded programs.

These are tentative numbers since the number of active ARPA employees reduces as the ARPA funded programs are completed through uh December 2026.

The last two pages of the report, pages 10 and 11, and you can scroll down, please to page 11.

Lastly, council member McCampbell wanted to know which Opera funded programs can be funded by City of Detroit's general fund.

And table three shows um the number of Opera programs uh that could be funded with general fund dollars.

Of course, um Mayor Mary Sheffield working with City Council have to agree to fund a program previously funded by ARPA dollars if general fund dollars are available.

And um that may be difficult as we know because general fund dollars are scarce.

It is important to note that um where uh in table three, there's a yes next to general fund eligible, which means that the program potentially could be funded by general fund dollars.

Um that we have to make sure the general fund dollars usage for that particular program does not violate the law department's stance on lending of credit.

And we know that linear credit uh that that provision in the state law basically says that you cannot use uh city dollars for private uses.

That's in a nutshell, a little bit more than that, but that's basically in a nutshell.

And so the Office of Development and Grants along with the budget department, they work closely with the law department to make sure that um if we were to spend general fund dollars on opera programs that would run out with opera dollars, uh, and we want to use general fund dollars that we have to make sure that it's not violating um the line of credit.

Um also uh in table three, there were some projects that indicated administrative costs only, which could also be funded by general fund uh dollars potentially.

Um however, again, according to the law department, those general fund dollars, if we if they were to be used, uh they could not support individuals because of lending the credit.

And then lastly, um table three out of uh out of the 139 opera funded programs, there were 79 of the 139 Opera funded programs that could potentially be funded through general fund dollars if they were available.

And then there were seven out of 139 Opera projects that indicated administrative costs only um but could also potentially be funded with general fund um dollars.

And so uh I know uh Mr.

Chair um it took a while for this report to come together for you, um, but hopefully this detail is giving you uh the answers that you're looking for.

And again, I think Ms.

Daniels could be um could could add, you know, uh could be added to the discussion if you have any uh specific questions on the operate funded projects.

But that's our that's the end of our presentation, and thank you so much.

Thank you.

Thank you, Mr.

Crowley.

Thank you.

Uh a lot of gratitude to you and team at LPD and also uh Miss Daniels for the work that went into the support.

Um really appreciate the thoroughness of it and wanted to, you know, the thought behind it is not only for us to have uh a view of where ARPA dollars are and and how much is uh spent, what has gone into it.

I know uh members of the public have been asking about that as well, but also as we're thinking about going into budget um and and programming and such, what can we spend money on?

And I know that there's a lot of work to I think a conversation about what has been effective at our programming and spending, and for us just had a blueprint moving forward as we think about the priorities and needs and funding opportunities here in the city, and also to give um the council administration a view on what's not able to be funded by general funding, as you mentioned, what outside sources we have to engage to make sure that that happens as well.

So thank so much for this.

Uh and I I've gone through it.

I'm gonna go through it again and go through it again, I think.

Um and and I'll probably have more questions.

Um but I I do have a question on this is this may be and this may be for Ms.

Daniels.

Um if she is on, but if not, I can follow up in the memo.

But Mr.

Chair, I don't see her directly, but if she could raise her hand, I can promote her.

She's on under Daniels TE.

And Mr.

Chair, you know, as she comes on board, and your point about you know what outside sources that maybe could be used if we can't find the general fund dollars, you know, for a program that council and the mayor would like to move forward.

Um, I I think uh Ms.

Daniels can speak to you know her office uh looking for you know any potential federal grants or state grants that could be used, and I would think the administration would try its best to work with um philanthropy, you know, uh foundations.

Um, if we can show them, you know, a good model as to why this program should move forward, maybe a foundation could um be willing to provide some funding for the program as well.

So just want to mention that for sure.

Thank you.

Uh good afternoon, Miss Daniels.

If you could introduce yourself for the record.

Good afternoon.

Terry Daniels, Director of Development and Grants.

Thank you, Director.

I know we we've been spending a lot of time together this week.

Um thank you uh again for your your help in this in this report as well.

Um I know you mentioned this just uh we we are on track for I know this was 85.5 million as spent of May 18th, but I know that's a little bit lower now.

Um, but we are on track to spend all of them.

We don't see anything going back to the federal government, right?

Correct?

We have we we are absolutely confident that we will spend all of the ARPA funds.

Gotcha.

Okay.

And um the for the ARPA funded head count that's that's uh of of folks that are working on ARPA funded projects that are terminating by December 31.

Uh is there a transition redeployment or severage plan for those staff members?

Uh to the chair, uh we are experiencing um attrition.

We're actually down to like 189 staff members um paid by ARPA now.

Um many ARPA employees are transitioning into other city jobs.

Um of them are leaving for other opportunities.

Um, but we are working closely with human resources to try and um give people opportunities to transition into um other city jobs.

Great.

I that was that was gonna be the part B uh part A of my question on if we are um if their transitions to other city jobs.

You know, we heard in the last budget presentation of even the increase in professional contractual services.

So even as we get a breakdown of what that increase comes for, it'll be great to see if we could get some of these folks to cover that to be city employees.

Um the the other question I have is uh as you were coming being promoted to be a common panelist, but I'm sure you heard it, as we are thinking about the efforts in reaching out to whether it be state, federal, and philanthropy philanthropy, if you can just go into those efforts and and how can we as a city council be helpful and really making the case for that these programs are effective and that we need to have that support.

Uh so my office is you know, working closely with the mayor's office and working with our philanthropic funding partners to um try and get funds to fund those programs that are not eligible to be funded with general funds.

We are always on the lookout for state and federal opportunities, and as you might see, um there are always uh letters to council that will that we're asking for approval to apply for various grants every week.

So we my office is constantly applying for um federal and state grants.

Um we're having conversations with the philanthropic and um corporate partners to um try to fill those funding gaps.

Thank you.

And my last question, as I know we are focused on getting the money spent and and closing our programs, do will your office or anyone administration be putting together just a breakdown of you know the impact of these programs and and I would guess qualitative and quantitative data on uh these projects because I think that also would go a long way as well as we think about what needs to be funded moving forward and how we reach out to external partners as well.

Uh to the chair, we actually have a team that is our data and analytics team that is ARPA funded, and their responsibility is to um collect all of the metrics associated with um all of the the projects and residents that are served and impacts.

So we have been required by Treasury to do an annual report every year.

Um last year, Treasury lifted that requirement.

Uh, but we plan on doing a final report, even though we're not required to, we will do a final report once all is said and done um by the summer of next year.

So the close out has to happen by April 30th, 2027.

So after that time, we will prepare a final report that will show all of the impacts and outcomes.

All right, thank you.

Any questions from our colleagues?

Just a quick member waters.

Um, well, first of all, thank you for applying for the various grants.

Yes, you know, state, federal, and so forth, because we really um we really do need those.

Um so for those departments um who received some opera dollars, but who may not have been able to use those in a timely manner, they can't spend them.

How how we are encumbering those?

For example, uh DEGC, did they use all of the APRA dollars that they received?

Uh, through the chair too, Councilmember Waters.

Um DEGC for the Motor City Match Um, they did not use all of their funding.

And when we discussed yesterday about the reassignment of the dollars, some of those dollars in that resolution from yesterday come from that program for unused dollars.

What are we gonna do uh with them since they didn't they so we're gonna just encumber them and in and disperse them other places?

I did you know how many people need help and they couldn't use those dollars really?

Uh through the chair to councilman waters.

Um the motor city match program um is a a longer term.

So once the businesses are selected, yeah, they have to go through um technical assistance, and it it takes about 18 months to get through each cohort.

So once all of the cohorts were finished, um there wasn't enough time, even though there was money left, there wasn't enough time to create a new cohort.

So those fund that those funds were pulled back and they will be reallocated towards um projects of your choosing.

Boy, that's too bad because you know what?

Technical assistance is so critical for all of our businesses.

Many of our businesses have they have skills, um, they know how to get it started for the most part, but they don't know how to grow it, nor can they sustain them.

And technical assistance is so critical, and I I really do hate that we were not able to utilize those dollars for that.

I truly do.

So I just wanted to make that point.

Thank you so much.

Thank you.

Thank you, Mr.

Chair.

Um, thank you to everyone who um played a role in pulling this report together.

It is uh great to have.

Um as I look at the general fund eligible column, uh some sales say admin costs only.

Can someone just explain to me what that is?

Uh through the chair, I can explain that admin costs only means that let's say, for instance, Motor City Match.

While we can pay for DEGC to administer the program, we just can't pay for the grants that they give to the businesses.

So if we were to if we were to be able to secure grant funding to fund Motor City Match, then the general fund could pay DEGC to administer for administrative costs, but we can't, but the general fund can't pay for the actual grants to this to the small businesses.

Okay.

Um just wanted to understand that because I do see the Detroit Housing Services on here that says admin costs only.

Um the other question that I had was is relative to the 22 technically 23 projects that have the um completion or deadline after September 30th that Mr.

Quarley was referring to.

I thought in previous conversations, September 30th was the deadline because we wanted to ensure that the dollars would be spent by the end of the year.

Um there are several housing projects that have a deadline after September 30th.

I would love to get more information, more granular information about those 22 projects to understand how much they've already spent um, like where they are on track to actually spend the dollars just to make sure we don't get to December, and it's virtually impossible for us to spend any dollars that are left coming from any of those projects.

Uh to the chair, may I to uh council member Johnson?

Um those grant those projects that are running through um November and December, those are personnel costs.

So a lot of our projects have personnel cost city personnel costs associated with them.

So those are personnel costs.

We are keeping people on until the you know absolute latest that we can as they are continuing to close out their projects.

So those aren't contractual, they're they're personnel costs.

Okay, so like 7850 East Jefferson Lee Plaza, um, those housing projects that still have Fisher 21 lofts.

Um you're saying those are personnel costs for the developer or for us internally relative to that development project.

So, with the exception of the affordable housing developer agreements, so anything under affordable housing development agreements, those do go until the end of the year, but they are likely to close prior to 9 30.

But we maximize the end date for it because those are those are big ticket expenditure items, they're not going to come in um a little at a time.

It's gonna be a large payout once they provide um the invoicing documents to us.

And and I think that's my concern, right?

Um, so we have the housing projects.

I I just really like to know where they are.

Um, how much they've already utilized or have spent based on the allocation for their projects and the ARPA related spend, um, just to make sure they are in fact going to be able to utilize the dollars and not um in December say, okay, we spent 80 percent.

Um, the other 20 percent we just weren't able to get done before the end of the year.

We can certainly provide an update on where they are so that um this committee can see um what has been spent thus far and what's left to for them to spend through um the end of their contract.

Okay, that'd be great.

Thank you.

Thank you, Mr.

Chair.

Thank you.

Anything further?

All right, just again, thank you.

Thank you, Director Daniels.

Thank you, Mr.

Crowley, thank you to folks at LPD um for this very thorough and important report.

So thank you all.

Is there a motion to receive and file 6.3?

It's been a motion to receive and file 6.3.

See no objections that action shall be taken.

That'll move us on to 6.4.

This is a resolution authorizing a resolution promoting property taxes reduction from Member Whitfield Callaway.

Is there a motion to approve or discuss?

Well, Mr.

Chair.

I'm so sorry.

So I had a conversation with um one of her, I think the chief of staff of her office.

And it looks like Councilmember Callaway would like to embellish this resolution.

Okay.

Is there a motion to bring back 6.4 in two weeks?

Motion.

It's been a motion to bring back 6.4 in two weeks.

See no objections that action shall be taken.

Under miscellaneous, these are two memos from my office.

6.5 is a memo relative to the NEZ fiscal impact.

And 6.6 is a memo relative to the request for information on the fiscal year 27th role funded under the revised marijuana tax projections.

We've been asked to bring both back in two weeks.

Is there a motion to bring it motion to bring back 6.5 and 6.6 in two weeks?

Seeing no objections, that action shall be taken.

And that will take us on to member reports.

Folks have any member reports.

Well, just want to announce skill trades today, Mr.

Chairman.

Yep.

Go ahead.

And we should be heading there soon, huh?

Yes.

You can't make it today.

Yeah, I'll be there today.

I'll be a little late because I have the board meeting, but I'll be there.

Okay.

All right.

So it's uh co-chaired by um Waters, um McCampbell, and uh Miller.

That's today, 4 to 6 p.m.

And you know the skilled trades is getting to be uh quite something.

It's it's you know it's getting more and more note um opportunities for people, so we do encourage people so that we can connect them uh with labor unions.

Um some of them manage to start uh work the very next day.

So again today, folks, 4 to 6 p.m.

Adams Butzel Center on London.

Thank you so much.

Thank you, and we'll see everyone there.

Vice Chair Johnson.

Thank you, Mr.

Chair.

Just want to let Detroiters know that on Saturday next Saturday, June 27th, from 10 a.m.

until 1 p.m.

We are hosting a job fair in partnership with Detroit at work.

Uh the Detroit at Work Payne Pullium School located at 18017, East Warren.

That is East Warren and Radner, just east of Balduck Park.

Um, so we've always seen just a number of residents come out from all parts of the city.

Uh that has always amazed me, but uh just shows how much residents are looking to work and looking for good employment.

So again, that is next Saturday, June 27th from 10 a.m.

until 1 p.m.

at the Detroit at work paying pulley school located at 18017 East Warren.

Thank you, Mr.

Chair.

Thank you.

And yeah, if you're in any parts of the city, make your way to the east side to the job fair uh to make sure folks get gainful employment.

Thank you so much, Vice Chair Johnson.

Uh just the one re uh item for myself this Saturday on June uh June 20th.

We will be having a district seven Juneteenth Freedom Festival.

We'll have uh free food for folks, resources, health uh checks.

Also, we're gonna have uh dancing.

We're gonna teach people how to hustle for those who want to lend a Tomia hustle.

Please do come out.

Um, and just an overall celebration of Juneteenth, but also making sure to connect folks to resources throughout the city.

So join us this Saturday from 12 to 4 at Rooch Park at the corner of Joy Row and Spinoza.

All right.

With that, seeing no further business for this committee.

Is there a motion to adjourn?

Motion.

It's been a motion to adjourn.

See no objections, uh, this committee stands adjourned.

Thank you all.