Good evening.

Good evening, counselors.

And thank you very much for continuing this conversation and and um uh inviting us back to have this conversation.

So thank you very much.

Mm-hmm.

And Councillor Randorf.

Thank you so much.

Thank you so much, President Tamonic, and thank you, um Executive Director Beldon for coming back.

Um we asked you uh specifically to come back to uh take a look at uh perhaps revised budget uh to specifically look at uh decreases in your levy requests because for us the Duluth transit system is essential.

It's essential in Duluth.

Every single counselor uh here in this room agrees with that.

Thousands rely on transit every day to access jobs and school and health care.

Um it's a basic service that we need.

And we need a strong system, and we need the routes to remain reliable.

So we're all in agreement on that.

Uh we need a strong system and a balanced fiscal uh strategy from you as well.

And so on September 29th, we sent uh there was uh Councillor Forsman, Councillor DeLuca, Counselor Nephew, and myself sent a list of uh seven questions.

Those are the questions we're gonna review tonight.

And what we asked you is we asked you to provide a revised levy and an underlying budget that explores the possibilities of increasing other revenue sources, such as increased passenger fares, trolley charges, advertising revenues, contract revenues, and the like.

Have you come tonight prepared with a revised budget?

Thank you, uh Counselor Randorf.

And um our levy request is remaining the same for this year.

Um I did send a presentation.

Did did everybody get a chance to look at that?

Yep, we saw your PowerPoint.

Yep.

Okay, and in there um we did update our our forecasts.

Okay, talk a little bit more about that.

I'm just pulling it up on my own computer here.

Um so a few things did change between the our last meeting and what MINDOT has been announcing to us through updates with the state legislature and what um the funding forecasts they have as well.

So um the biggest news with that is that for 2027 they're also um remaining at that still decreased um local match requirement to uh 15 percent, still not back up to the 20 percent.

So that's all the way out into 2028.

Um what now has changed is also their extended forecasting for uh capital awards, which has become challenging for them with uncertainties with federal funding and state funding sources as there was a reduction in in state um revenues for greater Minnesota transit, 11 million the next two years they decrease.

So um we only know our our capital vehicle awards, which is our biggest expense usually.

Um that's for 2026.

We do not have um preliminary awards for 2027, 28, 29, 30.

So we made a few assumptions on what we think we might get based on our need.

Um how they award buses is the entire state of Minnesota, and they go down a ranked list on what's the oldest worst condition buses in the state.

And once you get to the top, you're up next, you get the awards.

Um a lot of times that's years after they've met their useful life.

The vehicles are um, well, in our case, good half of them are are parked.

Um we we're stressing out the fleet we do have because we haven't been able to replace those yet.

Um of them they're past twice their useful life, so they're they're in rough shape.

They're needing more continual maintenance, that's an added cost.

They're less fuel efficient, more cost, and so on.

Um so we did make some assumptions on it's uh 19 total buses that are needed, uh large buses over the next three-ish years.

So we in 27-28 kind of made a guess on where those might be.

That helps us out in that the min dot match for operating, which is our our largest expense.

We are projecting to drop a bit in 27.

Um beyond that, there are uncertainties, but through um deferring some of our other capital projects, we have not been applying for um usually it's min dot.

They are they they also get federal funds that they then disperse out through uh competitive grant processes.

We have not been applying for those funds for the last few years, and we we can continue to do so, but uh that'll that often comes at a higher expense somewhere else, either down the line or in operations.

So if I can just paraphrase you based on this year, you're still asking for the 43% increase going from 2.3 million to 3.3 million.

And what is your projected levy increase next year given some of the assumptions you're making?

How much lower will that be?

Where will that be at?

Um to the first question that that is correct.

It's a 43% increase in the levy request due to the funding investment levels from the state dropping.

Um that that local match requirement increased.

Um our actual budget is increasing uh only three percent.