Okay, thank you.

Right.

I was here at just a public.

Shall we go?

We are unmuted.

Okay, everyone, welcome to NAMPA's FY27 community budget presentation.

We're very excited to have uh Mayor Bruner here to welcome us, and then uh we'll get this kicked off.

Welcome everyone.

Is uh my first opportunity is uh is the new mayor in NAPA to be here and uh and then I get to introduce some really really special people regarding this City of Napa fiscal year budget, and I think I counted uh 589 pages, and uh and I often also heard rumors that once this budget year in August public hearing is over, pretty much you're automatically getting ready for the next one.

So uh anyway, we have the director of finance uh Doug Racine here, and uh your staff.

How many do you have now, Doug?

Oh your teammates, I should say.

Well, that's about nine.

Nine teammates, and I know a lady that uh printed all this, Leslie is back here, so you probably should see her face, but she probably won't come up here.

But anyway, I just uh want to thank the citizens.

Hopefully, you will take time to look as far as at the budget, and uh Amy Bowman, our director of communications.

I am so impressed.

I know she had help too, but with this uh city of budget summary, it's just well well well done.

And a lot most of you probably will not go through the 589 pages, but do take a look at this.

And the other person I get to introduce who has been through this process from the beginning is our chief of staff, Clay Long.

So we're gonna have him come up and bring some greetings and also give you some information before our our finance director.

All right, thank you.

Well, good afternoon.

Thanks for joining us, all of you here and online.

Um before Doug talks about the budget itself, we thought it'd be helpful to set the stage and give some context of how did we get to the point we're at today.

So, as you'll see in the budget book as well, this work really starts in the July time frame as we start looking at what the community needs and how that drives the pieces that come together for this budget for our community.

On the screen right now is the process kicking off with the budget on the capital that we just did recently, and then moving into uh today's presentation, the final one being in August, as council uh reviews and then holds a public hearing where there's another opportunity for folks to give feedback if they'd like to on the proposed budget.

So, how do we get here?

Well, for NAMPA, we definitely have strong roots in our conservative history of ensuring that we're good stewards of our dollars, that we're accomplishing the stuff that the community says is important, um, that we rank those and then identify those priorities, and you'll also find in our budget and within each of the department the goals that are aligned to the departments based on the city priorities that are identified through community voice.

That drives the development of the budget, and then we work on measuring those throughout the year to ensure that departments are accomplishing the work that the community has identified as important and a value to them.

Those all get put together, and then we have our proposed budget.

The proposed budget then goes uh before council.

Um those four community areas that we focus on are a safe and healthy community, the economic opportunity, excellence in city government, and movement in and through NAMPA.

So as you look at each department area within the budget book, you'll see all of their goals aligned to one or more of these four, and then every dollar that's been allocated or proposed to be allocated to those departments, help them accomplish and meet these goals to continue moving the city forward.

The services and amenity that the city provides are vast.

We are a large city that provides full service to our community.

We have a very strong partnership with the FIRE as a separate entity, but still an important stakeholder of our community.

The list goes on and on.

You'll get to read more about that within the budget book and identify and see what was accomplished last year and what folks are hoping to accomplish this coming year.

So to get into the technical side and go through the detail of the budget itself.

I'm excited to welcome our chief finance officer, Doug Grace.

Mayor and Clay, thank you very much.

The budget is a this presentation is a culmination of months of work.

Basis for our authority.

It is the proposed output of the finance department and all the departments of the city working together in a very effective cooperative matter.

And we'll go through some of the aspects of the budget, the bill, how why the budget mattered, where the money comes from, where it goes to, and we'll end with a uh comment about what's not in the budget.

What are the challenges of micro and how that might have been very important to say?

Let's go into the goals and objectives.

Every year in creating the budget, we start off with a theme, a goal, an objective to obtain some new measure of accuracy or improved performance.

This year we wanted to focus on holding our operational costs to zero so that we have room for dealing with the criminal issues and round control.

The um environment we were budgeting in was for the most part uh without a mayor.

Uh we have now rumors now been uh our ability gives us the guidance we need.

So the chief of staff um directed the city to build a budget that held things constantly prior years.

Don't create a new project, don't add something new, continue existing projects, and try and budget as conservatively as possible until we have leadership in place to help provide the need of guidance going forward.

We also wanted to maintain or improve our labor position relative to comparative municipalities and government agencies.

We have a challenge in that, but we've been um working for years to try and improve our pay structure to make the pay of a function in that equivalent to the pay of the everything function in Marine and other cities, so we have that correct balance of uh pay for performance.

Um in the past, we have sometimes been a training ground.

We train, we have a very good staff, we train, and then people are able to go get a better paying job, same job at a different municipality.

So our goal has been to not lose ground and to try and close ground, not overpay, not underpay, but pay the right value to get good value for the dollar.

We also wanted to reduce the capital budget so that the capital budget more accurate accurately reflected the projects that were likely to get done in the coming fiscal year.

We tend to budget for what we'd like to get done, and then life intervenes, and we become a little slower at getting off the mark.

So we're trying to reduce the capital budget to be more appropriate to what we're actually going to spend.

At the same time, we want to increase the operational accuracy of the budget.

So that for our operational costs, they're right in line, they're not over, they're not greater, they're right in line with what we expect.

And those are our goals for this year.

Let's talk about where the money comes from and where it goes to.

Starting with the first column, government, general government.

That is funded entirely by the sources listed there.

Property taxes, and I'll get to the division of percentage in just a moment.

Property taxes, state shared revenues, which are principally sales tax, and liquor sales tax, interest income for the cash we haven't spent.

We invest it moderately with low-risk investments, and we derive a value of interest income, and then transfers.

And very briefly, transfers are when we provide services to other departments.

IT, accounting, finance, HR, mayor's office.

We provide services for other departments, and we charge them for that service.

That's a transfer.

And the general government is comprised of the following departments.

Not all, but uh clerk's department, clerks department, code enforcement, the mayor and city council, economic development, uh, and the and the core services of finance, human race, human resources, information technology.

And the biggest single department is the police.

They make up the vast majority of our budget.

We'll get to that in a minute.

Then we have the enterprise funds.

Enterprise funds are golf, irrigation, sanitation, water, and wastewater.

They derive their funds from fees for services, your water bill, your irrigation bill, your sanitation bill.

Those are all funded directly.

No property tax money goes to the in it to the enterprise funds.

And then there's the internal services, engineering, fleet, unemployment, uh, utility billing, wellness and workers' comp they are funded primarily by fees and services, payroll deductions, and transfers.

And rounding it out, we have special revenue funds, 911, airport, cemetery, the civic center, grants, and not notably uh one of the smaller ones, notably Family Justice Center, the library, parks and recs and streets.

These all get a portion, most all get a portion of property taxes.

They have state shared revenue that supports them, shared highway, road and bridge taxes, road and bridge taxes, and transfers.

And debt we we only have one significant debt for the city, and that's related to the recent completion of our wastewater treatment plant, the water renewal plant.

Uh that was required and required investment by the DEQ.

And we've completed that, and now beginning this is the first full year of payments to pay that down.

And then funding for capital impact, capital costs across the city are funded through a variety of means.

We take some interest income, franchise fees.

If you if you get a utility bill, um electric bill, gas bill, you look at the very bottom, there'll be a little franchise fee tax.

That's the tax that comes to us for the franchise fees.

We take those and invest them in city capital infrastructure.

It's uh fairly minor amount of money compared to the total budget, but it helps us deal with capital projects.

Now let's look at the pie chart of these funds.

On the left hand side is the total funds.

I'd like to point your attention to the services revenue, special services revenue, 36% compared to the property taxes.

That little blue slice is 17%.

That's the total property taxes we receive is only 17% of the city's funding.

The biggest part, special revenue comes from fees paid for services such as water, wastewater irrigation and sanitation, and then other funding sources such as impact fees we derive from new construction, transfers, um, intergovernmental, which would be the sales tax and the shared revenues from the state.

And then grants and loans are a portion of our fees as well.

On the right-hand side is just the funding for the general government, the police, the clerk's department, the mayor's department, and internal services.

And there are property taxes make up 55% of our funding with the intergovernmental, the sales taxes, and transfers accounting for the two other biggest slices.

We also have interest income and other financing, but the governmental side is actually smaller than the enterprise side.

And that's we want to make clear no taxes and sales taxes go to the enterprise side and the special revenue funds.

So let's look at the totals or how these are used.

We bring it into general government, and then we allocate it out for the clerk's department, the uh code enforcement, code compliance, Napa City Council, this all pay and the facilities that keeps our facilities in the best shape they can given the funds they received.

And this is just kind of a general uh graphic about the overall structure of the general government.

Now let's look at the the details.

How are the property taxes used?

This year, for this year's budget will have 49.6 million dollars in property taxes.

That's an increase of 2.8 million dollars.

And I'll get to why that increase in just a moment.

But the increase primarily goes into general government, and that primarily goes to feed the public safety of the city.

So we have new staff, um, new equipment, new vehicles, um, pay increases.

That's the biggest slice of that money goes right to the public safety.

Streets gets 2.6 million dollars, and they they take that fulfilling many their many needs.

They have they have more needs than they have funds, so they use it very effectively.

Airport gets a small size, small slice of funds, and it's important to note that the airport, while we give them 272,000 in property taxes, we get back about half of that for the property taxes we charge for facilities and hangars on the airport.

So it's it's a we can partially it feeds itself.

Parks gets about $3.2 million in property taxes.

Uh that goes to maintaining, developing, lawn mowing, keeping in good shape for the use of the city.

That goes to maintaining, developing, lawn mowing, keeping in good shape for the use of the city.

Cemetery has a small amount, $303,000, and library gets $2.3 million for $49.

You'll notice that the airport parks, cemetery, library, they get modest amounts of increases.

That's just enough to cover the cost of wages and health care and benefit increases.

Let's look a little more deeply into the use of those funds.

The police budget is 42.1 million dollars.

That's an increase of 1.4 million over the prior year.

Now, if you look back at that prior page, I guess I can go back here.

Um the police budget uh is 42 million dollars, but the amount of property taxes going to the federal government is 40 million dollars.

So we have a uh a gap we have to fill.

About 1.8 million dollars.

Did I start a timer or something?

Okay.

Let's see if I can take it off.

Nope.

I've got it, we've got it.

Okay.

So property taxes meet 90, 95 percent of the needs of the public safety, but we need more funding to cover it, and that comes from our shared revenue services state uh uh sales taxes.

Streets departments.

Well, let's talk about their revenue.

They get 2.6 million dollars in property tax funding, but they get $9.4 million of highway and district revenue and road and bridge taxes, $600,000 of interest income.

So the property taxes are a smaller portion of the of the streets funding.

They could use more, we'll have to find a way to address that in the future.

But uh their 11, 12 million dollar budget is primarily coming from the gas tax, so to speak, the highway district revenue.

Parks, impact fees can pay for new parks, uh, but the city has to fund the operational support, the ongoing maintenance, and the upkeep of the existing parks.

And we have a broad system of parks, and we're stretched very thin, but we we make it to work.

The parks department does an excellent job, and then we also spend about a million dollars, one in capital to maintain the the capital assets or build new ones.

The library gets three million dollars, and uh about port shared revenues of about 0.4.

Let's look at the levy history.

Back in 2018-2019, the levy rates were very high at 0.78, 0.0078.

Now we're down at a 0.0028.

It's up very modestly from 2025, but I want to clarify the tax levy is not the driving factor of the home levy, your home property taxes.

The way that's achieved is by taking the total taxable value of the city, the total taxable value of the city, which is $17.3 billion this year, that's up $980 million of the prior year.

We take that $17.3 billion and divide it into the city's property tax budget, that gets a levy rate of the 0.0028.

So the levy rate is the byproduct of the of the city operations, it is not the reverse.

Now they take that levy rate and then apply it to the valuation of your homes to get the tax for individuals, but it's from this calculation of dividing the taxable our budget by the taxable assets of the city.

And the 0.00287 is an estimated number.

The final number will come from Kenyon County after the budget process is completed in September, October.

Let's talk about the budget specifics.

What is in the budget this year?

We asked staff in the city departments to keep the requested new staff increases to a minimum.

We didn't we felt it was time to have a pause.

Let's wait till we get formal leadership with the new mayor.

So we held that flat, and I'll get into that in just a minute.

But labor and benefits increased $3.4 million.

There's a little bit in there from new staff.

Most of that is going to be a very sharp increase in health care.

If you've watched the health care costs across the country, they're on a rapid trajectory upwards.

Ours are no exception.

We were initially proposed a or presented with a 15% increase in our health care costs.

We were able to get that down to about 7 to 9%.

That's a that's about a million dollars.

And the rest is benefit, labor, and then uh some staffing.

Operational cost decreased $8.1 million.

I'll get to that in a second why that went down.

Debt service increase by 0.8 million, that's the DEQ loan for repayment of the water treatment plant.

Capital decrease by 12 million.

That's our goal to reduce the capital budget to more appropriate levels of what we can accomplish.

And transfers and allocations decreased by millions.

So the net budget in 27 decreased by 17.1 million dollars over the original budget in 26.

Let's go and talk about for a moment the Ford Idaho Center because it impacts the budget reality.

The conveyance of the Ford Idaho Center at the end of fiscal year 26, reduced the overall 27 budget by one eleven point one million dollars.

That means we had in 26 we had a budget of 11.1 million dollars in revenues and eleven point one million dollars in expenses.

That was included in the budget.

Getting rid of that 11 million dollars doesn't mean I have 11 million to spend because all that money was determined and generated externally from city operations.

It was the result of concerts, both the revenues and the cost, concerts, events, gun shows, uh RV park.

But taking that out reduced our budget total.

What it did do for us is the conveyance reduces the city's ongoing financial burden by give or take a million dollars a year, depending upon needs.

Most of that is capital.

We would have been paying that ongoing for the next years, plus any deferred maintenance that needed to be taken care of.

And having that burden lifted from our shoulders while it was a very the process was very challenging to get through.

From strictly a financial perspective, it relieves the city of a burden of having to care for that going forward and allows us to focus more effectively on public safety, transportation, streets, and the critical needs that the city is dealing with on a daily basis.

So if you take out the Ford Idaho Center, this is what the budget looks like.

The labor is up $3.4 million, net operations is up $3 million, and the capital is down $12.2 for a net budget decrease of $5.8 million compared with the prior year.

That's apples to apples, and all the impacts of the Ford Idaho Center have been removed in that comparison.

That's that's a pretty good budgetary approach.

That shows we're we're paying attention, we're not overspending money, we're we're paying very close attention to the capital at operations as well.

So let's go into that $3.4 million for the wages.

Why is it so much?

We had seven new FTs, that's 0.8 million dollars.

Prior years we've had from 25 to 35 new FTEs.

So getting down to seven is a dramatic change in direction and control.

This is something we can do for a year, maybe two before we really start having uh growing pains.

But within those seven employees will be four new police staff, two for patrol and two for the real-time crime center, and then three others scattered across the city, uh, but that's 0.8 million dollars.

A 4% COLA, which helps us try and catch up a little bit to our neighbors, is $2.1 million.

Overtime is down 0.5 million, a lot from the police.

Um Percy is up 0.2 million, very moderate, moderate.

The health care up nearly a million dollars in cost.

That's going to be our challenge.

And then other is 0.3 million, that's $3.4 million of personnel costs.

Other operational costs, increases and decreases.

Contractual services, these are mainly contractual services in water, wastewater irrigation for services we pay to manage those utility processes.

Sewer line replacement, a big ticket item we need to invest more than that, it's up $500,000.

Electricity, it's going up.

We had a rate increase from Idaho Power last year that was somewhere between $10 to 15%, depending upon what type of an institution you were, residential or commercial.

Irrigation assessments, these are not coming from the city, they're being passed to us for the water rights, so we have to pass them on.

IT software and hardware, the cost of software.

If you look at the technical world, costs are skyrocketing.

The price of RAM, random access memory, other technical issues, IT issues, everything's going through the roof.

Decreases, repair and maintenance, 1.2 million dollars down.

That's good and bad because we still have repair and maintenance to do, but we're controlling the the projects we're working on.

Water renewal chemicals, because of the new water renewal facility that relies more on electricity, which is part of the electricity increase, we have less reliance on chemicals, and we can we can push put those down.

Engineering costs are decreased, and pavement management is down by $100,000.

Those make up the most significant increases and decreases in the operational budget.

Now, let's talk about how we got to the property taxes we have for this year.

The new construction, which is taxes on new homes and businesses, not a tax increase, new taxes at the existing rate, was $1,292,000.

Annexation, $104,000.

The 3% we're legally allowed to take is 1.4 million.

That gives us the $2,815,000 of a net property tax additional new monies for the year.

That $2.92 represents everything I have to spend to cover all the costs and creases, the wages increases, the health care cost increases for general government.

We have a bucket of foregone that if council saw fit could use for the appropriate reason, but it is not a taxable value to use as citizens until we actually elect to use it.

We have a bucket of 2.168 million dollars.

The maximum we can pull in for one year for operations, uh, and it has to be for a very good purpose, would be about 472,000 or 1%.

And right now, that is not in the budget.

There is no foregone built into the budget.

Other revenues, state shared sales taxes.

We're up about a half million dollars to 11.9 million dollars.

The trends have been in 25 and 20, early 25, they were a little bit flat, hard to tell where they're going.

They picked up steam.

As retail prices increase, so do our taxes, and as volume increases, so do our taxes.

That's almost 12 million dollars.

Shared state sales taxes decreased by 100,000, primarily due to legislation House Bill 967, which impacted the entire state and diverted sales tax revenues to help supplement funding for the Idaho State Police.

But it took it out of our bucket to do that.

Water, water renewal, and irrigation are all coming in at 2.89.

That's the CPI rate.

There is good and bad on that.

I'll get to the bad in a minute.

The good is we're trying to hold costs.

We're not trying to put anything else in the system.

The bad is we have an aging system with significant deferred maintenance issues that will need to be addressed.

This will not help us.

We'll barely keep our head above water.

And technically, it won't even do that.

And sanitation is that's for public services, your garbage collection, that's a 3.5 statutory or a contractual amount.

Um, that goes up 3.5% per year.

Let's look at the population, and then we'll look at the employees per population.

We can see from 2017 to 2027, 10 years.

We're up about uh what, 32,000 residents.

That's roughly mental math, a 30% increase, 10 years.

A significant increase for the city.

Let's look at the staff per population.

You'll see back in the on the far right or the far left-hand side, in 21 and 22, we had a big decrease.

That was when we um separated when the fire department became their own district and went to do their own process, so we had that decrease there.

Since then, we have maintained rounding notwithstanding, 5.8 staff per thousand.

So we are controlling our growth in staff to not grow faster than the population.

We want to keep that low, we want to make sure that we're providing the right services.

It provide it causes challenges because the growth is dynamic, and we're trying to do more with with the same uh quality of staff, but that's our goal.

Now, as we look at the budget challenges, let's think about what we're not doing with the budget that we need to be aware of going forward.

Police staffing to match population growth.

We're not doing that.

Um the original police request was 10 officers and two support staff.

We have four two officers and two support staff built in the budget.

And even that, we're still behind the population curve of what we'd expect to be.

So we're again asking the police to do more with less.

They do an excellent job, they're a good police department, but their capacity to meet the growth of the city is being stretched.

Facility maintenance.

A recent, very recent study of our assets of the city revealed that we have at least, this is just a portion of the study, at least four buildings in critical need of maintenance.

That's the Harwood Rec Center, the Napa City Hall, NAP Pacific Center, and the Idaho Hispanic Community Center.

Those are millions and millions of dollars behind in deferred and delayed maintenance or costs.

We're going to have to address that.

It's the electrical systems, it's the insulation, it's the found some not only foundation, but the roofing, the HVAC.

All these costs are building up because we've been deferred, deferring doing maintenance on them.

Those will need to be addressed.

They're not in the budget right now, and we're running out of time to take care of those.

And probably even more significant to the population is deferred infrastructure for maintenance and repair of streets, water lines, sewer lines, irrigation lines.

The amount of the number of accidents or breakages of lines is increasing.

You have water under pressure, irrigation under pressure, and that causes breakages on lines that are 60, 80 years old.

And you'll you'll get instances where just here on Northside, a couple months ago, we had one break under the street, water current starts gushing up through the cracks in the pavement and causing a flood.

It costs about 30 to 50 percent more to fix them than it does to do advanced maintenance to get them fixed before they break.

That needs to be addressed.

And council and may are aware of that.

They're working on plans to figure out how to do it.

They're also aware this is the cost to the city and to the citizens.

It'll be borne by those, so they're very aware of both sides of the coin, but delaying fixing those will result in greater cost down the road than starting to do them now.

So the budget only reflects the 2.89%.

Those are minimal increases, those are meant just to keep track or pace with the cost of inflation if we're doing the same thing we did this year as last year.

That leaves us in a challenging environment going forward.

You know, today it kind of looks okay, but we can't tell what's gonna happen tomorrow.

A main could break, an irrigation line could break, something with a sewer could go wrong.

So we have opportunities and challenges together.

Um I think what you'll find in this budget, and it is available online under the the City of Nampa website under the finance section.

Go look at it, read it, challenge it.

I we invite any public commentary, any cut public involvement, because we are spending your dollars and want your involvement, we want you to know we'll answer the questions, we'll give you the best responses.

But we're grateful to have present this to you.

And I think Clay and Mayor, that's all I have for the budget.

Thank you, Doug, and again the entire budget team for all the work that's been done.

Uh, just a few recaps and key takeaways.

I I think it's really important as we talk about the effort of the city and staff and department leadership to control costs.

There's a lot of costs that are outside of our purview that that naturally create expenses to go up, even if we don't expand services.

And so, as the community continues to provide and give their feedback of what's important to them, as you saw from the beginning, our priorities, those same expenses costs, those same things cost more today than they did yesterday.

So with the decreased budget, you know, again, any time we can look for areas or ways that we can be more efficient or to budget to our actuals better.

That's something we're always focused on.

Um staffing levels, police being one that's typically called out, uh, but across the city, staffing levels continue to be a challenge to meet the needs of and expectations as we look forward, especially with some of the large capital projects for deferred maintenance that need to be done, that's going to require additional staffing to take care of.

And on top of the staffing numbers, it's also the growing challenges of wages and that competition in the market that we're competing against for the same people of the same workforce in the Treasure Valley and trying to be competitive.

Um then finally, in wrapping with the community focus on public safety and transportation improvements, continue to remain to be the top priorities for the city in surveys and conversations that we have.

Those are the ones that that always rise to the top.

Understanding and recognizing infrastructure is one of those things that we want to make sure when we turn the water on, water comes out of the faucet, and we don't have uh delays with that.

So again, the process that we're gonna see uh today kicked off the community presentation.

There's lots of opportunity between now and August 17th during the public hearing where uh council will make a final determination on the proposed budget.

And the way you can submit that, you can go to the budget page, uh, the city of Nampa.us forward slash budget for anyone that wants to dive in or see that 586-page document and read it cover to cover.

And then also, if you have any feedback you want included with the public hearing, we encourage you to email that feedback to the clerks at cityofnampa.us.

If you're unable to join for the public hearing meeting, just please make sure that that feedback is sent to the clerk's office by August 12th at noon, so we have time to be able to include that in the packet for council.

And with that, if there's any questions, Doug's happy to answer them.

All right.

Well, thank you everyone for being here.

We appreciate it.