I say RL3 and you guys can do that.

Yeah, if there's another council where they can fill in over there, mayor I don't know.

So yeah, you're all good right there.

That's not even these evening.

Thank you, Bryce.

Good afternoon, everybody, and welcome to the City of Norman uh City Council Finance Committee meeting on Thursday, December 18th, 2025.

We're gonna flip the agenda a little bit and let Mr.

Francisco first, as his agenda item is currently number two, but this is his last finance community meeting ever, and he's in a rush to start retirement.

So we will let him let him address by all means.

So uh starting with agenda item number two.

Thank you, Mr.

Chair, and it's really my gotta pick up my granddaughter for her basketball game.

But anyway, um so on the revenue and expenditure reports that are in your packet.

Um, I will just highlight the one thing that we had um for the month of December that's not reflected here that we had a really good use tax collection month that got us back into the black uh for the fiscal year on use tax.

So that was really good.

Um, continues to be flat, but not um inexorably, so it's like negative 0.5 percent for the year.

Um, so it's kind of unlike right on what we budget.

What we budgeted is not good, but uh, but but at least we're not below that.

So I'll just try to respond to any questions that you might have on the revenue and experience reports.

Yes, sir.

Yeah, I've still like to have a little bit of insight from the state about use tax and the confidence in allocating those funds now.

I don't know who we contact in the state, but I'm just curious more than anything.

I want that confidence that hey, the system's operating at 95-90 percent as far as flow flow that collection and flow.

Yeah, and and all that I can say related to that is that um companies and online retailers that are quote unquote voluntarily complying.

Um we're very confident that they're reporting properly.

What we're not confident in is those retailers that are um fitting through the loophole in the in the um South Dakota versus Wayfair case, um, where if you have less than 100,000 worth of sales in the state, then you don't have to collect sales tax in the form of use tax and then admit it to the to the city that you're delivering the goods to.

And and a lot of retailers we think might be over that hundred thousand dollar limit.

A lot of retailers that you know we would like to be collecting because we know that mechanically they can't, but that's the that's the concern with use tax, and and uh so it's it's kind of a yes and no answer, but but we're very confident that those that are complying are complying correctly.

We're not we're not fully in compliance though.

I would think the state would would be able to echo that and show show hey, we're we believe the ones that are at the hundred thousand point thousand mark that yeah, there is percentage that we're not collecting, and we think it's this because of this.

They would have some type of procedures to give the health of that.

I'm just curious more than anything else.

Okay, what's the missed opportunity there, state, and then what are you doing about it?

Yeah, it's just anecdotal because remember that if you're under that limit, you don't have to report at all.

So the state tax commission has the same vested interest that we do, but they just don't know, and I don't think anybody can know how many retailers are out there that are just not reporting at all.

Okay, I think we should ask the question.

Absolutely.

Yeah, just um wanted to note the looks like this was the second best to again about like how things can look in comparison to something.

Um last year was the best December that we've had in the last eight budget years, going back to 2018 on this chart, and uh this this December reflecting October was the second best that we've had in the last eight years, only second to last year's.

So it it looks like it's down, which it is, but it's down compared to the best December that we've had in the last eight years, last year.

So that's my favorite chart to look at every month because you can see the whole history going back to the FY 2019 FYU 2019 budget.

And so and then yeah, just on the city comparison and the state being down by five percent so far, over five percent so far, and um that being just uh interesting data point and wondering why if it's the grocery tax or I suspect that it is, and I think the grocery tax should start to um the the year comparison will be uh as of next month, I believe.

Um that will start to wash itself out.

Okay, but yeah, um is interesting, council member, right?

When it comes to collecting that tax and knowing who's paying it and or not, how how do we find that out?

Like when somebody knows reporting.

I mean, if they make a report to the state tax commission, we have preview to that information.

The concern is retailers that are not reporting at all because they're not collecting the tax and remaining it to the state, i.e.

the city, so so we have no way of knowing.

But but but for example, if you have a new um favorite retailer in you know that's making purses and shipping them to um Wisconsin.

Um the state of Wisconsin does not know that.

Vice versa.

If you're buying a purse from Wisconsin and ship to Norman, we have no way of knowing that, nor to collect uh tax.

Thinking more locally.

This is small retailer that we're talking about.

Uh like how would you know if there are businesses in the city that weren't there's really no way to know you know now how we should know is that they're delivering it.

I mean, there is a zip code that we know that there's being delivered to um FedEx or UPS or somebody knows who that they're making delivery from that company, so that's how we should be able to collect it.

You know, um, when that retailer makes a delivery to this zip code, they should be collecting the tax and reporting at the rate uh that that is applicable to that zip code.

That's just not happening for the small retailers.

Okay, um I was also thinking just because we used to have an internal auditor that could kind of track down maybe not in the small retail scheme of things, but I was thinking about how the grocery tax is like uh make sure people understand their incompliance.