Absent and excused, but we're glad to have everyone else.

And we will start uh with a solid waste services overview with Ms.

Gupta from Solid Waste.

Good afternoon, uh, Mayor and Council.

I'm Shika Gupta.

I'm the Solid Waste Services Director.

Um today completes three months of my service with the city, so excited to be here.

Thank you.

Um I sincerely want to thank my team and acknowledge them for all the work they've put together for this presentation and for the budget of our department.

Um they've been really patient with me and helping me learn the budget and getting me here in front of you today.

And also I sincerely want to thank our budget and finance team for their support as well as we talk about uh solid waste services budget.

So um today we'll go over what Solid Waste Services Department does, our key accomplishments for fiscal year twenty-six, our uh base budget for fiscal year twenty seven, and what proposed fee we bring to the table.

And then we we will look at some benchmarking and then our yard waste enhancement program that we have been working on.

Uh, from the uh from the organics.

This is a such a great example of circular economy at a local level and a zero waste initiative that we meet uh through this facility we have.

And under other services, um, Solid Waste Services offers an on-demand collection service such as bulky special or items um collection.

We also allow residents to schedule the removal of specific household items upon request, for example, e-waste, and then we also provide services at city sponsored and non-sponsored events.

While the total number of bus stops have remains relatively stable, container locations and collection routes are adjusted regularly.

Um this is our first year utilizing the model that has been uh created in support uh with support from uh consultant for budgeting and forecasting, and the model has the ability to forecast for 20 plus years.

Just for context, Raleigh Water and Stormwater utilize a similar model for many years, and they have reached a and to get to a stable enterprise, this is uh this is an amazing tool that we have started to use as well.

Our contract with Sonoko Recycling for processing our recyclables um in this third year, um, we are continue to provide uh conduct audits there, and what those audits help us with is kind of guide our outreach and education for specific items that we want to focus uh our residents' attention to to provide a cleaner material that we can collect through our recycling um cards.

And I'll I'll um talk this about yard waste enhancement transition from transportation a little bit more detailed, but just as a reminder, this transition was approved by council in June of 2026, and we have start we started planning for it and have been planning through this fiscal year as well.

Another major accomplishment for uh that we are continuing to work on our um yard waste center pilot for food waste processing, and we have been collecting data starting of January of 20 uh of this year, and I'm gonna provide you some more information on this on a future slide.

So for fiscal year 27, our budget um before any rate increases looks like this.

So we have a budget gap of about 8.47 million dollars, and um the revenue for our fiscal 27 is um is reducing a little bit uh because we are only uh um realizing about 1% growth rate in our revenue, as well as we have a reduction in our yard waste revenue from uh transportation not bringing the leaves that they collect to the yard waste center and giving us a tip fee.

So that's about a $637,000 reduction in our revenue there.

And then also, as you can see, our expenses have also gone up.

So just to go a little bit in more detail on that, um so our budget increased drivers are mainly personnel.

So our personal exp personnel expenses have increased 3.8 million, driven mainly by the yard waste enhancement transition since we're adding staff and trucks, and increasing in increase in benefits and merit.

Internal transfer um in expenses have increased about $600,000, which are driven by higher shared service and direct costs, risk costs, and the new fleet CIP transfer included in this year's uh budget.

And then the last but not the least is our operational expenses have also increased by about 200,000, primarily driven by higher contractual services and other operational costs.

It is also worth noting that this category includes our transfer to our CIP fund, which remains consistent with the prior year contribution of about $819,000.

So looking forward now, um, what we are proposing as a rate increase overall is about 9.8%, which amounts to $2.55 per account.

Um this increase is a little more bit more than what was presented to council at 7.7% um earlier, and oops.

It'll wake up in a second, I believe.

Um so the 7.7% was what was presented earlier, but we are looking for a 9.8% rate increase to accommodate for the yard waste enhancements that we are making.

Also, we are proposing a $10 increase in the yard waste center tip fee along with a corresponding increase to the residential minimum fee.

Historically, this minimum was um said to reflect the cost of half a ton of yard waste.

However, while the per ton tip fee has risen over time, the residential minimum has not been adjusted accordingly.

So this minimum fee will now cover the cost of processing that material.

So with weekly yard waste collection, we are hoping that um beginning with that program, it should bring um reduction in residential res uh residents having to go to the yard waste center.

So they should be able to use the weekly collection service instead of going there directly.

So we are intentionally approaching the rate increase and being proactive about it.

So if you uh so that's why we are hoping that to maintain an approximate 9.8% growth in rate over next five fiscal years.

And these rate increases are needed to offset general fund subsidy decrease and supporting our yard waste enhancement transition.

This slide provides comparison with other cities in the state as well as out of state.

So while it's challenging to identify municipalities that provide the exact same services as we do, we have compiled a group of peer cities that have similar services.

So the comparative rates shown here are based on fiscal year 26 figures.

Given the inflate inflation happening everywhere around the nation, it is likely that many of those services will uh cities will also increase their rates this year.

So we have comparison with Richmond, uh Willing Wilmington and Irving, Texas, as they offer similar services as we do.

And you can see that we are lower than them right now.

Our neighboring peers, Apex, Holly Springs, Zebulon, they contract with an external vendor for these services.

So what makes it even harder is for example, Apex uses an external vendor for garbage and recycling, but the town collects yard waste.

So while our fee may seem higher as a monthly minimum, but other municipalities like Holly Springs, Apex, they charge fees for additional monthly card collection and higher fee.

Our fee is only $2 per additional card for yard waste collection.

Theirs can go up to $12 for the month for an additional card.

So with the rate increase I proposed, we are hoping to uh close our budget gap and uh balance our budget.

So the rate increase will uh provide us about 4.6 million, and then we'll also use some fund balance appropriation to uh to balance the budget and reduce uh reduce our gap to zero.

And uh now I'm gonna focus a little bit of my energy on yard waste enhancement program that we are working on, provide you some visuals on what uh what these changes will look like.

So we'll we are going from 26 yearly collections per customer to 52 yearly collections per customer.

So this is the uh uh split in how we collect every other week uh for for our customers, and this is what it'll look like now every week, what our uh what our collections will look like.

Um then this just gives you an idea on the four quadrants that we work on that we provide collect about 30,000 plus collections every week going forward, which is similar to what our collections are for other services that we provide.

And our year-round weekly yard waste collection will change from um leaves on the ground to actual cleaner collection type like the the one that's shown on the right hand side.

So this is just a visual of how much yard waste can be collected weekly.

So we are uh going from volume of a single yard waste card is this right here in front of a truck, and then on top of that, we also allow for up to 15 biodegradable bags.

So that's estimated 2.2 to 3 cubic yard that the resident can uh put on their curb every week.

And last but not the least, our yard waste center currently um currently transportation uh takes about 25% of leaves to a third party.

So now it will be coming back to our yard waste center, increasing our um our input into the yard waste center and needing more resources there to process all of it.

Okay.

We are um in the first year of our of our model, but ultimately our focus areas are to reduce revenue leakage, improve cost recovery, and align with the best practices that we have set for ourselves.

So just a few services that we are continuing to evaluate and look forward in the future years to um to balance our budget there and reduce our dependence on uh any grant uh uh general fund.

Our bulky collection fee starting April 1st, we have a charge of 25 35 dollars that we have instituted to recover some of the cost of our bulky collection.

Um for our yard waste center, our processing fee have intentionally been kept low over the years to minimize the financial impact on residents, limiting our ability to recoup our all our costs and fully recover them.

For central business district, we provide a really high level of service with one six and seven-day pickup options, but we are still charging the same monthly fee as we do for a uh residential customer.

Similar for our for our multifamily collections, we charge multi-family the same monthly fee as we charge residents, but they are using dumpster service.

So that's that model is different as well.

Internal city departments currently are not charged tip fee or fee for products like compost and mulch, so that's a cost that we need to recover.

As well as for our city-sponsored events, uh which some of the cost is um uh covered by our general fund.

So we continue to evaluate these services to get our um costs better and better.

The food waste processing pilot that I mentioned earlier, we launched that on January 5th, 2026 to assess processing feasibility, and we're expecting the final report on um in the middle of July, but that's not a part of our fiscal 27 proposed budget.

The the findings will inform if the site should be considered for conversion to a permanent food waste processing facility.

It will also play a key role in determining the city's future approach to residential food waste collection.

With that, um we recommend that um you authorize solid waste services to use the proposed rate increase to begin programming and testing the billing system as well as notify customers of these rate changes.

The final rate approval will occur with adoption of the fiscal year 27 budget.

With that, I'm available to answer any questions, comments?

All right, thank you.

Questions from Spipta.

Um we'll start with Council Branch and then Council Jones.

Definitely, thank you for the presentation, the work in trying to get us um treated more like enterprise as far as the solid waste.

My question is you're looking at staffing the yard waste facility.

But one of the challenges we have overall is just city overall growth.

So my question is do we have the staffing needed to just keep up with growth outside of just the yard waste facility with personnel being such a high cost of the budget?

The reason um thank you, Councilmember Branch, for that question.

I uh the recent staffing study did guide us into that direction on making sure that the growth is accounted for.

So for this coming fiscal year, if we are focusing on um the yard waste enhancement program and getting the staff that we need to roll out that program successfully.

But in the future years, we have built in um additional staff for other programs as well.

Okay.

And also, are is there any work being done as far as automation tools and services to make the operators kind of be more efficient?

Yes, we are looking into that as we speak.

We are the team is conducting some pilots on the truck to uh to basically go paperless on routing and other things like that.

Yes.

Okay.

All right.

Thank you.

Welcome.

Good afternoon.

Thank you so much.

Uh I just have a question about our leaf pickup.

And when we changed that last year, we did mention that we needed a program for the disabled and the elderly who couldn't uh put the leaves into the bags themselves.

When will we be hearing about that?

So we are uh so our um NAP program, the um assistance program is available for the yard waste enhancement as well.

So they get that service now.

And we are exploring our options to see how we can help and provide any additional help uh to the uh to the residents who aren't able to put them in the cards.

So when will we hear back about that?

So I will help um her answer that.

We already have like backdoor pickup and assistance program to help those that have some physical limitations and aren't able to do that.

What we and anticipate doing is continuing to carry on for those who have been approved users of that program and kind of look across the board in ways in which we can be more efficient in operations because in some instances, like it may be attributed to a residence where the person that's living in that residence right now might not still have that same physical limitation.

So we're trying to clean the program up across the board.

Right.

So when when will that be cleaned up?

How will how will we know?

Because I need to be able to tell the residents.

We when we had that last year, and I said, hey, this is what we're doing, we're we're getting this program.

Am I okay to tell them right now that it is the needs assistance and their leaves will get picked up?

Yes, if they are already on the list, and if they're not, they need to reach out and make um contact with us and staff will make an assessment to determine how we can best support them.

And that's as of today.

So I can say that now.

Yeah, okay, great.

Thank you.

And who do they contact?

Do they contact a solid waste services to get on that list?

Or probably the easier place would be if you want to if it's directly just for Solid Waste Services, but we also have customer care, which kind of runs the gamut and will kind of funnel the call where it needs to go.

Okay.

Thanks.

Counselor branch.

Just last question.

This is something to provide it later.

Um you mentioned how our services compared to other cities and other communities.

Can we at some point in the manager's update get that list like this is what the city Raleigh offers compared to you know neighboring communities and what they offer?

Because I think having that information too is helpful when we speak to rates and increases in services where we can say, well, we do A through F.

These communities only do A through C and everything else is being offered by our private vendor.

So if we could get a list of those comparable cities, I think that would be helpful.

Okay.

For sure.

Also, I'd be curious about our increases over time.

I think we've got the last five years here and you know, numbers like 10 percent, seven, eight, you know, this is a a high percentage increase for a year.

Is that what other cities are seeing?

Can you get that kind of data?

I'm just curious.

Are our cost increases, you know, comparable?

You can add that to the list too.

Thank you.

Counselor Patton?

Yeah.

And so just to um pull on that thread a little bit, yeah, it does look like there's been high percent increases over the last several years.

Um I definitely understand that you need more personnel and and we're making changes to one of your um one of the services you provide.

So um I understand that also compared to our other enterprise funds, this is increasing at a rate higher than inflation, higher than the other enterprise funds.

Do you anticipate a time when this rate of increase will slow to something more like two or three percent per year?

Um it's hard to answer at this point, honestly, um, Councilmember Patton, because I think we could we are looking at next five years and we are still looking at that rate increase of 9.8 percent to come to a uh good point.

But definitely with the model, we should be able to uh gauge that and see what year is that it it's it's a break-even year.

So we can provide that information.

Okay.

And the closer we get to true cost recovery is probably when you'll see those um um operating increases go down.

And as we discussed, it's probably been about two, three years ago now, how do we get them to self-sufficiency?

How do we get them to a full enterprise?

This is our next step into getting um solid waste services as an enterprise truly at a cost recovery model.

And you might recall if you'll put that slide back up, Luke, if you can find it, like we're still really in the market was still reasonably priced in in comparison to not that one, yeah.

Um our peer and benchmarks.

And wouldn't which of the areas I I think you spoke to this, but which of the areas are the ones that are not uh which are that are farthest away from full cost recovery at the moment?

Um just from the top of my head, I think the Yard waste center needs a little support, and we need to find fine-tune our model more to recover that cost.

That I think that's the biggest piece that we need to work on.

Okay.

As well as other services that we've provided, like I mentioned, the bulky pickup fee.

We are charging 35, but our costs are much higher than that.

Okay.

Do you know how much they are off the top of your head?

80 dollars.

Yeah.

Got it.

Um then one last question I had.

I in one point you said that um because of the changes to the leaf collection, you have about 1.6 million dollars in lost tip fees from transportation.

And then later you said that interdepartmental services don't pay tip fees.

Can you like talk a little bit more about interdepartmental fees that are paid or not paid?

Um the tip fee was 637,000 loss that we are going to see from transportation.

Um but um I have some notes on that.

Other departments, uh a quick example that comes to mind.

I don't have a number off the top of my head, but I can come back with that.

Okay.

Yes, I'll ask just in terms of the enterprise recovery.

This is, I guess, piggybacking on counselor branch's question, like how many other municipalities actually are recovering and have achieved that self-sufficiency?

I mean, are we part of the norm with this level of general fund subsidy?

If you have just general response to that, but would love to have more data.

Okay.

I I don't right now there, but yes, I we can definitely add that information in that.

Okay.

And then the second, just again, I you know respect that you've you've operated in California and different states and have a have a broad perspective here.

I mean, when you see that level of general fund subsidy, I mean what would be more, you know, just service levels that you could to get there, like would you do yard uh like recycling once a month?

Would that save a bunch of money?

I mean, are there major levers we could be pulling here besides this uh rate increase to try and balance?

Yeah.

So some of the services that we provide are the the model needs a little bit more help, for example, for our central business district and for multi-family.

We are really charging uh we are not recovering our cost for the services that we are providing.

Okay.

And another example, like I mentioned, the bulky collection fee.

All these items on here need uh need a little bit more work to determine how we can get to the point where we do redu recover our costs.

Yeah.

She's been really gracious.

They need a lot of help, to be honest.

Um there's a lot of support that goes for the central business pickup that we do daily downtown.

Um and businesses aren't afforded the opportunity for the big receptacles because we don't the way that the our downtown is laid out, they don't have alleys.

So we're kind of the only game in town to do that.

The Yard Waste Center, again, we don't cover cost.

Um bulky pickup last year, we contemplated the true cost, and it was around $75.

And that's a part that not every community affords their residents, but it's like picking up couches and mattresses and things like that that there is a fee for us when we dispose of that because that's not kind of what we do in solid waste.

So there are many components of their service delivery model that do not cover, don't even come close to covering cost.

And really in the years past, it's not really been that much of an issue per se as a subsidy from the general fund, but in years like this year, where the general fund revenues aren't what we expected or will not be in next year what we expected.

Our ability to subsidize some of these operations that have a revenue strain um attached to it aren't going to be the same and as um generous if as we've been in the past.

Well, and then just the final um on the central business district.

I know we did have a very brief um experiment of these more kind of large uh waste.

I would be again just interested if there are ways we could address this beyond you know what what we're I don't know beyond that one pilot.

Have we tried different approaches?

Yes.

And um that's the beauty of having someone who's looked at it from the lens of the West Coast and a different experience than we've experienced here.

So those are some of the things that she is bringing to the table for us to consider.

Not obviously she's only been here three months, so she can't take some.

Those are some of the things she brought forward in her budget conversation that we'll be looking at obviously next year.

Okay, great.

Thank you.

Just a little bit more about the central business district.

I'm assuming these are the older buildings.

I'm assuming the more newer buildings have either a loading dock that actually that's where waste is picked up.

Is that fair to say it's more the older areas that don't have because I'm thinking about some of the newer buildings, whether it's commercial or hotel, probably have a loading dock where they put their carts.

Is that fair to say?

Well, um just briefly, I've been on one ride along in the field in central business district, and I realize one of the food halls has 30 carts placed outside.

So that's uh and if they have space to place 30 carts, they probably have space to place a bin or two.

So those are the kind of things I'm looking at right now to see where we can minimize some of the effort that we are putting in.

Because of course, emptying out 30 carts takes much longer than a front loader take picking up a bin.

So we'll we'll definitely work on streamlining the central business district and see where we can help them.

Okay.

Uh counselor cotton.

Yeah.

Just um just staying on that.

I I also have done a ride along in the central business district, and it's uh kind of banana grams when you're rolling off those 36 carts to be like, why why is this food hall operating much the same way as my house?

So um resonate with that.

Do you have a sense of like I understand you're you're sort of like wrapping your arms around the problem right now?

Do you have a sense of when you'll have a proposal of how we can update that process?

Do you think you need like six months, uh nine months?

If I may, I think I'll I'll feel more comfortable bringing it to the next um next fiscal year discussion, because then we'll be able to kind of do it all at the same time potentially and know where our costs are going and where we can invest better.

Okay.

I think we have exhausted our questions.

Uh thank you very much.

Thank you very much.

All right.

Next we have the external agency grant recommendations.

And we have Katie Conyers from Budget and Management, Ashley Tucker from Housing and Community Development, Tony Gadston from Arts Commission, and Carl Wilkins from Arts Commission.

Good afternoon, Mayor and Council.

I'm Katie Conyers, Grants Administrator and Budget and Management Services, and I'm here to present our FYA 2027 agency grant recommendations.

Here's our agenda for today.

We will begin with a quick grants program overview.

Then I will invite representatives from the Raleigh Arts Commission and our housing and community development department to present their respective programs, agency grant recommendations for the upcoming fiscal year.

The Human Relations Commission will plan to present recommendations for human services grants at the second regular council meeting in April.

Recognizing that we have a very full agenda for today's work session.

To begin, the City of Raleigh offers competitive grant funding for nonprofit organizations across three categories arts, community enhancement, or CEG, and human services.

The arts category supports nonprofit arts organizations and arts programming within the city through program and operating grants.

The CEG category, which is funded by the Community Development Block Grant or CDBG, awards funding to nonprofits that serve low and moderate income residents, and whose proposed projects align with CDBG priorities and the city's consolidated plan.

The human services category offers funding to nonprofit organizations providing direct services to older adults, youth, individuals facing housing insecurity, individuals with disabilities, and individuals with substance use disorders.

We have several council policies in place that govern agency grant programs.

First, the maximum funding request for any agency is equal to 25% of that agency's prior year actual operating expenditures.

Second, agencies may only receive awards in two grant categories.

So for example, an organization could potentially receive funding through both the Raleigh Arts and Human Services Grant Programs or through the Human Services Grant Program and CEG.

Oh, excuse me.

Finally, all agencies that submit funding requests of $25,000 or more must submit audited financial statements for review by the finance department.

Before we discuss specific award recommendations, I did want to share this breakdown of general fund dollars dedicated to agency grants.

This includes human services grants, arts per capita funding, which represents arts grants, organizational technical assistance, arts commission programs, and Raleigh Arts Plan implementation, as well as direct allocations for human services and arts residence companies.

Again, these awards are made from the city's general fund, and the recommendations total $4.55 million dollars for fiscal year 2027.

Please note that this does not include our community enhancement grants, as those are funded by CDBG.

That allocation represents an additional 200,000 in agency grant awards.

Good afternoon, Mayor Cowell and members of City Council.

My name is Tony Gadston, and I am here with I am the chair of the Raleigh Arts Commission.

Joining me today is Carl Wilkins, who chairs the Arts Commission's Raleigh Arts Partner Committee.

First, allow me to start by saying thank you.

Thank you for your belief in the art as a means to build community to allow people to have a voice and honor memory.

Specifically, thank you for showing how poetry can do all those things by launching the city's new Poet Laureate Program during last month's State of the City Address.

The arts program helps the city achieve those same goals as well by investing in public-private partnerships with Raleigh-based nonprofit arts and cultural organizations.

For example, this year the Raleigh Arts Commission is recommending funding for 36 organizations, and among those being three new applicants, Red Bud Writing Project, Raleigh Film and Art Festival, and the Black Box Dance Theater.

The Red Bud Writing Project will offer its community classes program focused on giving people who are unhoused, who are survivors of domestic violence, and or in recovery voice through writing.

The Raleigh Film and Art Festival is planning a free filmmaking education program for high school and college students.

It will culminate in screening of the students' work during the film and art festival this October.

Plan accordingly.

For a free screening of their new documentary called We Lift Each Other Up, head over to the Realto Theater on Saturday, May the 2nd.

The Raleigh Arts Partner Program Committee evaluates all the arts grant applications submitted each year.

This year, comprised of four arts commissioners and 11 community panelists with expertise in nonprofit management, finance, community engagement, and the arts.4 million in funding as part of the arts belief in a fair and transparent process.

Each application was evaluated and scored against a set criteria that covered artistic merit, nonprofit management, finance, and community engagement.

Based on that process, this afternoon, the Raleigh Arts Commission is recommending funding for, as mentioned, 36 organizations with an investment of 1.95 million in support.

It also includes welcoming back two organizations that didn't have the capacity to apply last year, Diamante Arts and Cultural Center and VAE Raleigh.

They both participated in the Arts Commission's new technical assistance program, organizations in transition designed to help organizations navigate major changes so they can grow again.

On behalf of the Raleigh Arts Commission, we submit the FY 2026-27 art grant recommendations and respectfully request mayor and city council approvals as presented.

Thank you.

Thank you.

I guess we can ask if there's questions now.

Do you have?

Yeah, just briefly, I know groups get a chance to receive money in two groups, two categories.

It seems as if only the Raleigh Little Theater is the only one that's receiving funding twice.

One from the work that you all are doing, and then historically they're also receiving money from this city as well.

Is that do you all consider the other funding when you all look at contributing to or recommending a contribution to our group?

I'm going to allow SA Corin to address that question.

Hey, SA Corinth, Arts Grant Director.

Raleigh Little Theater along with Theater in the Park both have multi-year agreements with the city, and the way those agreements have traditionally been structured, they are given the opportunity of also applying in the program support grant category.

But they are the only two groups who could apply both for an annual grant and for the multi-year agreement.

Okay.

Have we how when is that agreement run out?

It runs out in either 2029 or 2030.

Okay.

Um yeah, just something I just want to highlight, bring attention to.

Um it's been brought to my attention in other ways.

There's some challenges.

I know the Raleigh Little Theater has been having as far as leadership and um community outreach.

So hopefully that's something that is considered, because I know a lot of our grants kind of work as a little bit of a rebate.

You go, you spend the money, then you get it back.

So though we approve it for them to receive the money, I just want to make sure they meet all criteria before it is dispersed.

Yes, they are paid on a reimbursement basis, and for the multi-year agreement, there are um specific things that they have to do programmatically via community theater, um, produce eight productions a year, have an education program, and so they have to do that every year in order to continue to receive funding, even though it's a multi-year contract.

Okay, thank you.

You're welcome.

Okay.

Other questions?

I would just say, I mean, this is a tremendous amount of work, so many great organizations, and just appreciate all the volunteer time that went into reviewing these and all the hard decisions you had to make.

Thank you so much.

Okay.

Do we need to make a motion?

I guess work session.

Okay.

Okay.

Yeah.

Yeah.

We still have the housing and community development, right?

Yeah.

It's the same presentation.

We we have a few more slides for the last presentation.

Thank you so much to our arts commission representatives.

Next, I would like to invite Ashley Tucker, compliance and planning unit supervisor with our housing and develop housing and community development department to present the community enhancement grant recommendations.

Good afternoon, Mayor, members of council.

The community enhancement grant is a $200,000 allocation from the Federal Community Development Block Grant.

It funds public services for low-income individuals, families, and neighborhoods, and it is funded through a competitive request for proposal process with the RFP being issued in October and applications are due in December.

Applications are reviewed by housing and community development staff.

Those applications are evaluated on the following criteria.

CDBG eligibility, proposal quality, consolidated plan alignment, and housing stability impact.

Staff is recommending the approval of four grant awards of $50,000 each.

That CEG funding will support programs that advance housing stability, homelessness prevention, and services for low-income residents.

The recommendations that the committee has put forward are for early years, the women's center of Wake County, Family Promise of the Triangle, and Interact.

And more information on each of those are in your packets, but I'm happy to answer any questions on some of the general talks of those programs.

So my question is how do we get more funding in this category?

I don't know who can answer it.

But I mean, that's my thing every year.

I mean, it's talk to your delegation in DC.

I mean, so my understanding though, this is based upon population, correct?

Like what is the formula for how we receive this number for this category?

That's information that staff can get back to you or MLS.

Emily Sutton, Housing and Community Development.

So this is all from our community development block grant funds that come federally.

And this is specifically the amount that we can provide for of that allocation for these purposes.

So it's federal funds, federal funds says you can use this amount for these types of activities, and that's how we so if we receive more, does this go up?

Or this is this still limited?

And I'm asking that because our population is increasing.

So I would think we would get more federal dollars, but yet this number hasn't changed in 10 years.

Yeah, that's a good question.

We can look back at the historical, but uh like for example, HUD just announced our entitlement funds, and it's pretty much the same as prior years.

I don't think we've seen a significant increase in recent years, but we can get that information to you.

Okay.

Thank you.

Mr.

Rainey, call her for us.

Well, I guess they don't do that.

My question, again, I appreciate the work and the very difficult decisions from so many incredible applicants that really are going towards housing and housing stability.

And my question is about how this intersects or interacts with the Human Relations Commission.

Um do we cross-reference these?

And I know we've got a separate request about how are we thinking about legacy grants and the human relations commission, but could you just speak about is this made completely independently of those decisions?

Uh yes, that is made independently of those um debt committees.

Those they're two separate committees.

Okay.

And I guess I would just do you think that's ideal.

It's it just seems like uh maybe that should be a question we should ask ourselves.

Is that if these if we you know we're able to fund so few of these groups that fundamentally get at our number one priority in the city, should we be looking at these and thinking about the human relations commission and how we allocate and who's applying?

Absolutely.

Staff can look into that and we'll provide more information.

Okay.

Thank you.

Any other things?

Just while we're talking about human relations grants, are we are those in the hopper sometime soon?

I have a question about them, but I I'll ask it at the appropriate time if there's um good afternoon, Mayor, members of City Council Sadia from Saya Satara from Budget and Management Services.

Uh you will be hearing from uh the Human Relations Commission with regards to their grant uh suggestions for fiscal year 27.

That should be coming up in the second meeting in April.

Got it.

Yes.

Okay, I will hold my question until then.

All right, thank you.

Okay.

That's it.

Thank you.

Just circling back to see if there are any other questions related to that concludes our presentation.

So if there are any other general agency grant questions, I'm here to answer those.

No.

All right.

Appreciate it.

Thank you.

Thank you.

All right.

That brings us to uh parking.

We have Caitlin Parker from Transportation.

Sorry, Mayor, you got me here just for a second.

Uh Paul Callum here, transportation.

Good afternoon, Mayor and Council.

So as y'all, I'm just gonna kind of tee this up here.

Uh y'all saw this item uh about a month ago.

I'll say it was aggressive.

Uh hopefully I can set the tone here for what y'all are going to see with Caitlin's presentation here.

It's about 15 slides.

So hopefully we take to uh we took a uh kind of calculated, measured, modest approach uh with what you're gonna see here uh next here.

So hopefully this will start moving the this the parking enterprise uh in the right direction here.

So just kind of want to set the tone on what you're gonna see with Caitlin here.

Thank you.

Good afternoon, Mayor and Council, the actual Caitlin Parker coming up.

Um parking manager for the city of Raleigh, and today I'll be reviewing our parking rates review.

So quick agenda for us today.

We're gonna do an off-street review on street and then go with some recommendations and next steps.

I do want to say before we start this, off street is very much in a reactive mode right now, whereas on-street we are in a proactive approach.

So for our off-street review, here is a map of our garages throughout the city, trying to give you a visual where they're at.

In the blue, you have our non-event garages.

So for example, that city hall where most of you park today, Wilmington Garage, which is right by Marbles, and Morris Square.

Then we have our event garages in purple.

And then our event venues.

So Red Hat, Convention Center, Performing Arts, and in the future the Omni will be in that same area as well.

So for our non-event garage rate options, again, this is like City Hall, Wilmington, Moore Square.

Our current pricing structure is $2 per hour with a $14 daily max.

And our current hours are Monday through Friday, $7A to 7P with the first two hours free.

For our proposed pricing, we're going to $3 per hour with a $21 daily max.

And then for proposed hours, there's three options.

So the first one is current hours Monday through Friday, $7A to $7P, first two hours free.

Second one, Monday through Friday, 6A to 12A with the first two hours free.

And then Monday through Friday, 24 hours, so daily, first two hours free.

And that far right hand column shows the projected additional additional revenue per year, those changes would bring in.

So for our event garages, again, these are our garages within a block or less of our event venues.

So our Kabaras Garage is a different structure.

It is $1 for the first two hours, $2 an hour after that with a $14 daily max.

And then performing arts convention center Charter Square are at $3 an hour with a $15 daily max.

Now Kabaris is very unique in that it currently is operating like a non-event garage, even though it's literally right there by the convention center.

So it's Monday through Friday, 7A to 7P.

And then those other garages are 24-7.

So proposed pricing is to go to $4 per hour with a $24 daily max for all those garages.

And then to make Kabaras Garage a $24-7 garage as well, since it's right there next to convention center with our other event garages.

With those changes, you'll see there's two numbers there for the additional projected revenue, which comes in about a total of $730,000.

So our program options for off-street.

So currently monthly is about $125 per month.

There's two proposed pricing, $135 or $140.

And to our far right, you can see those projected additional revenue.

So for our first off-street staff recommendations, we are proposing to keep the three programs in place, which are free two-hour parking, free nights and weekends, and the free small business program.

Now remember these programs are only for our non-event garages.

Then our other recommendations are for our non-event garages to go up to that $3 per hour, $21 daily max.

However, keep our current hours.

So keeping that Monday through Friday, $7A to 7p in the two-hour free parking.

Then for our event garages, we want to bring in Kabaris to be that 24-7 structure, and then increase the rate to the $4 per hour with the $24 daily max.

And then for our programs, which is our monthly program, increase from $125 to $135 per month.

From there you can see the projected revenue is about $1.8 million for the off-street.

Okay, on-street.

So as you remember in a previous presentation, we did say that on-street revenue cannot defray the cost of off-street expenses.

However, that does not mean that on-street does not have expenses, plus we have future expenses coming down the pipeline.

For example, those meters are aging.

While they look beautiful, they are aging.

They're about to be a decade old.

There's a large cost to replace these meters.

We're also putting money into current meters just to make them operational.

So here are three rate options for the on-street meters.

I want to clarify currently we're at $1.25 and $1.50.

Remember, about 68% of our meters are at $1.25.

We're proposing that they would all be that rate that you see on the presentation.

So what could these funds be used for?

Well, they could be used to help with the bike and scooter crowds.

They could be a resource for a residential parking permit program that I know you're all very well aware of.

That is a large program.

It's continuing to grow.

There's a lot of resources and expenses to maintain that program.

It could be useful for traffic striping.

And then also, as you know, our community is asking for more parking enforcement beyond the downtown area.

So these funds could help increase parking resources to do that.

So staff recommendations and next steps.

Our first recommendation is for us to retain the following programs, which is free two-hour parking, free nights and weekends, and free small business program.

Again, those are in the non-event garages.

And then to go forward with these other recommendations in the garages.

So again, non-event increase rates, but maintain that Monday through Friday, 70 to 7P and maintaining that two hours.

Event garages, bring in Kabaris and increase rates.

Increase the monthly rate to 135, and then increase the on-street rate by 25 cents.

And by that I mean it all goes to $1.50, not $1.50 or $25 cents on top of $1.50.

Next sets for us.

It's going to be a parking study, RFP RFQ.

And then RFI for Wilmington Street parking deck.

And with that, I'll take questions.

Okay.

Questions from Ms.

Parker, um, Mayor Pro Tem.

Yeah, thank you so much for bringing this back.

I know there's been a lot of interest in ensuring that folks can park downtown and don't feel um concern about these costs.

So I really appreciate you all bringing back this second uh kind of options for us.

Um can you tell me more about the on-street uh parking that 25 cents, what it can be used for?

You had mentioned specifically the markings on the street, and I know that is something that I do get a lot of um requests for that we are not um I'd say maybe painting our streets regularly enough in certain areas.

So can you just explain what exact type of markings can be used with this increase, where um how does this help with pedestrian safety and just safety of especially our downtown areas that rely on on street parking?

Yeah.

So with the general statute, it allows for traffic enforcement and ordinances.

So we could use it to stripe crosswalks.

Um also there's a lot of parking that's not striped currently, and so it could also be used for that to ensure that people we all see people that maybe don't park appropriately.

So maybe we had some lines to help guide our community to park correctly, that would help.

Um but it can be used with traffic striping to a point.

Um and I know we've been working with our city attorney's office to make sure what we can exactly do for traffic striping Council Branch.

So I just want to make sure I'm understanding this correctly on the recommendations.

The first one is um keeping the hours 12 hours for our non-event garages.

Yes.

Um at the rate of um one I'm sorry, three dollars.

Three dollars.

Three dollars an hour.

Okay.

Then for our event, making both of those 24 hours fee at $4.

Correct.

So convention center charter square performing arts are already 27, 24-7 to begin with.

We just want to move Cabaris into that uh hour structure.

Okay.

And then a program fee would be 135, and then on street parking, we're saying just for those that were 125, they become 150.

Correct.

And those that are 150 remain 150.

Correct.

Okay.

My question for the event parking.

Um what requires the 10 the people out there with the 10 dollar parking signs that we see at those lots compared to the $4?

So these are our event garages, and then we have event parking or special event parking that we've not even touched.

Currently that's a ten dollar fee that we charge for that.

We do have a criteria within the city, and I don't I can get it to you later, but I believe it's a 10,000 attendee threshold, which is actually quite large.

Okay.

Yeah, it's the it's 10,000 attendees is what triggers that kind of $10 special event rate.

10,000 over one a week.

Like what's for the event itself.

For the event itself.

Okay.

Okay.

So got it.

Because some events, so basically, if a conference comes in, parking for your week because you're going to have over 10,000 people, require triggers a 10 dollar parking.

For the special event rate.

For special event rate.

Okay.

Okay.

That's helpful.

Counselor Patton.

Yeah.

Hi.

Um Yeah, I thought the for the presentation we got a month ago was really aggressive, so I'm really appreciative of the way we've um kind of scaled this back.

I will say, you know, I've been engaging with folks a lot on this, and certainly we've gotten a lot of engagement in our inboxes, but also just on social media and and in person I've been engaging.

And I do think the public actually has like a actually much more sophisticated understanding of how that this cause has to be borne at some point.

And I think they're understanding that we have to move in a direction of these costs being paid for at an enterprise level, but we're not necessarily ready to bear the full brunt of that and understand that that the trade-off is some subsidy from the general fund.

So I think this is moving us in the right direction, and we should also be stepping into a pattern where you are back in front of us just like our other enterprise funds to tick up at a steady rate so that we don't find ourselves filling such a large hole over time.

I do have some questions.

The on-street.

You gave a statistic.

So some I'm sorry, you've probably said this now three times in this presentation.

So some of the meters are already at 150.

And some of them are at 125.

And you gave a statistic about the percentage of each.

Can you give that again?

How many are at 120?

68 percent at 125.

Okay.

So only that 68 percent are experiencing a change, and the remaining 30-ish percent are staying the same.

Um I think that's a helpful note.

Um then to put a fine point on it to draw this out that that additional revenue that you're generating will allow you to proactively invest in those meters that need replacing and other things like that.

Because you know, some something that has come up across the discussion related to the off-street is that they've this maintenance has been deferred.

There no no fault of any particular staff member, but the maintenance has been deferred, so it's not a great experience.

So people are saying uh under logically are saying, like, why pay more for poor experience to raise these rates on-street is to prevent that same kind of experience for the on-street users, right?

Correct.

We're trying to get like not into that reactive mode with on-street.

Um, the meters are a lot of them are getting older.

I'm sure some people have used them.

That's a pretty high cost replace those.

So we're not trying to add to this gap because it's already big enough.

Right.

Um I have Lambert Milton and then Silver.

I missed the first work session where the initial parking presentation was made.

Um obviously I read a lot about it, caught up when I was back in town, and I've heard a lot about it.

Um one question I had at the time was whether this on-street um revenue could be used to support our streeteries program where businesses are allowed to create outdoor dining.

I had asked that question to one of our assistant city managers.

My understanding from the attorney's office is that it could not be used that way.

Um so I don't think we're going to be able to explore that option, certainly not this cycle.

But seeing that the on-street parking revenue can be used for things like the bicycle and scooter corrals, I do think that is a benefit to the public because folks do complain about um multimodal um rental options, clogging sidewalks, knowing that it can be used for resurfacing is important.

I would like to see what sort of flexibility could exist in the future.

I will not be here, but could exist in the future for the streeters program, um, because that could be a nice trade-off too.

I do know that when um COVID happened and cities were moving to allow more flexible outdoor dining, we s we set up our streeter program, unlike a lot of other cities.

We made ours permanent.

And so when other cities were walking those back, we kept ours.

And I do think that that outdoor um use of the public realm, in my opinion, is better than car storage for allowing people to sit out there and eat and drink, and it helps our small businesses that have access to it.

And so some of the feedback we've heard about these parking changes have been from the business community downtown.

And if there were a way to allocate some of those resources to make the streeter's program uh more affordable uh or to maintain the the cost, I think that would be great in the future.

But I understand right now doesn't seem like it's an option.

Maybe that's an opportunity for our legislative agenda in the future or something.

Thank you.

Uh you mentioned that 68 percent of the meters are at 125, 32 at 150.

Uh we did receive some correspondence that people were concerned about, you know, the turnover.

I know some of them have time limitations.

Uh is that does that vary throughout the downtown?

In other words, you have a maximum amount of number of hours you can use the meter.

Uh is that consistent across the board or that too varies throughout the parking meters?

So for our meters across the board, it's that two-hour max.

That's it.

You might be talking about some other hourly regulated, but it's not paid like meter parking.

So there are different times.

Okay.

So it's two hours, whether it's 125 or 150 after that, you have to move your vehicle to another spot.

Okay.

Thank you.

Do you have to move?

Because I've sometimes some meters say you can add more time.

Do hours allow you to add more time?

If you're not at that so you were there for an hour, you could go add to two hours.

And you're supposed to move out of the zone.

I don't want to tell you how to get around the system.

But you can add more time currently if you're not past that two hours.

Correct.

Okay.

Okay.

So if you're not past the two hours.

You could add more time.

Okay.

So one of my questions is on the RFI for the Wilm Wilmington Street deck, right?

How did you hone in on the Wilmington Street deck as a prospect?

Yeah.

So two things with that.

There's been interest in that garage in the past.

And then two, that's one of our garages with the least amount of contractual obligation.

So I think in the past presentation, we remember we said that 55% of our spaces are contracted, right?

So like Red Hat, the corporation within the Red Hat Garage, contractually, they have 550 spaces up to 1200.

So Wilmington doesn't really have any of those large contracts.

Gotcha.

Yes.

On that, if you're able to sell Wilmington Street, does that money then just go into general the maintenance?

Where does that does that fill that gap?

Where does that money go?

I'm going to ask my budget teamer.

Good afternoon.

So certainly I think at the time that that sale would happen, we would bring that back to council.

And then certainly I think it would be at Council's discretion where those where those funds would go.

Certainly we would anticipate hopefully those funds staying within the enterprise to help offset a lot of the cost and the debt service that we have got within the enterprise.

Counselor Silver.

We were all a bit shocked from the options the last time.

So I do agree with Councilmember Patton that is a lot more logical moving forward.

The last option got a lot of public attention.

And I don't know whether they are watching, and again, we'll get some see similar feedback that this seems to be a lot more reasonable because it is a balancing act.

We want to make sure our downtown thrives, but at the same time we need revenue to keep up with uh maintenance as well as with meters, whether it's uh off-street or on-street.

So I don't know if we're just going to let this conversation like the last time uh take its own.

Are we going to be proactive putting it out there so we as council members can get some feedback because it seems that this is now uh in the more comfortable direction.

Uh definitely keeping you know the free parking, a two hours free parking, nights and weekends, and then just modest increase on some of the other ones.

So just want to know that we are listening, being responsive, and just want to know how we're going to uh share this uh with the public because this will be part of our budget deliberations.

Good point.

And staff met with um the leadership in DRA last week to have a conversation to kind of discuss some of the possible options that we were going to bring forward to council today.

And we will work, we will continue to work with Bill King to make sure that it is communicated to the business community, and just as soon as this meeting goes live today, people will know about it, trust and believe.

Um so yeah, we we will have many opportunities before we bring it back to you in May in the proposed budget.

So just a quick update.

So I talked to Bill King this morning.

Will Gaskins is here.

So we have got a virtual meeting set up with DRA this Thursday at night to build a vet some of these latest proposals with them.

So that will be our next step on that.

Yeah.

Councilor Jones.

Um just a quick question as we're talking about DRA, we did receive an email.

Um and I just wanted to ask about turnover data for on-street parking.

Do we have that currently, or would that be part of the parking study?

Like when people leave, if if that's been a problem uh of turning over cars, or if it has not been.

Well, for right now, we have the two-hour limit.

So they have to move after two hours.

Um we do have some of that data.

The parking study can go much more in depth.

You also have to remember that once meters are we're not paying them, we don't have that utilization data.

So again, with more funds, we could have that technology that would capture that for us and tell us, you know, the parking study should it be extended to 10 PM or whatever it may be.

Um also, as we spoken to, the reason for an increase price is to create that turnover so people move to the garages for long-term parking.

Thank you.

Well, and I would just say I think you know, Bill and others have done a good job of walking us through some of these.

And I know there was uh the desire to not do anything to on-street until we have had the turnover data and the more expansive study.

And I think the council, at least in our discussions, was receptive to that, but we felt that given 68 percent, right?

32 percent were already at $1.50, that this is um something that at least gives a nod to the level of the gap and the general fund woes that the city is having, um, knowing the restrictions on those use, um, but that a 25 cent we felt was minimal enough that this would not dramatically impact downtown.

So just to sort of reflect on what the conversations at the at the table uh have been as as we've you know mulled over these changes.

But um I appreciate the scale back on this.

And lastly, I just want to say thank you because I think last time I asked, can we have some uniformity in pricing?

So I think we went from five different rates now down to three.

So thank you for at least, you know, looking at that and making some some improvements.

So I still will have some wiggle room on the on-street parking, but we're gonna let this one stay where it is for now.

Parking for now.

All right.

Park it.

Put it in the parking lot.

All right, yeah.

Okay.

Thank you.

Thank you so much.

All right, and then we have the uh capital improvement program with Hannah Osborne.

Good evening, Mayor, City Council, City Manager, City Attorney, and Clerk.

I am Hannah Osborne, and I am from the Department of Budget and Management Services.

Here is today's agenda.

First, I will provide a high-level overview of the capital budget process.

I will explain what has occurred to date and what to expect in the next few months.

Next, I will walk through the general funds pay-go or cash funded projects for fiscal years 27 through FY31.

Then I will provide a status update on the city's advanced planning process, uh 2026 general obligation bonds, and future limited obligation bonds.

In September, the city kicks off the capital budget process.

By the end of October, departments formally shared their identified capital needs with the budget office and the city manager.

In step two, staff evaluate unfunded requests and departments presented present their prioritized requests to the city manager's office.

Next, our department works with the finance department to identify the most appropriate financing, debt or pay-go for the requested unfunded projects.

This process is also involves reviewing department's available capital budgets and reallocating budgets to meet higher capital needs.

To prepare the CIP, staff present components to council.

On March 9th, parking, stormwater, Raleigh Water all shared the proposed operating and capital needs with council.

On March 10th, council heard from staff on the housing and transportation bonds.

During today's budget work session, you've also heard from Solid Waste Services and received additional information from parking.

Then in our step five, um, on July 1, we hit the ground running to act on our new budget authority for capital projects.

The functions listed on this slide are all considered enterprise departments.

Enterprise funds account for operations that are financed in a similar manner to private businesses and have user fees to directly generate revenue for those particular services.

Since you have heard from enterprise departments with potential fee changes today and at your last budget work session, my presentation will focus on the general fund portion of the city CIP.

As previously approved by council, there are four capital areas with a dedicated one cent equivalent of the property tax rate.

This slide displays a shelter replacement at Kwanis Park, which is one of the projects that was completed and funded through the penny for parks maintenance.

Council's previous policy decisions commit funding for affordable housing, street resurfacing, parks maintenance, and citywide pay-go needs.

As reflected on this slide, the city anticipates less than a half percent increase in the annual value of a one cent equivalent of the property tax rate from the 26th proposed budget to FY27.

Staff had shared have shared the main drivers impacting property taxes at your January retreat, and you also heard from the Waite County tax um administrator at the March 17th council meeting.

With all that considered, uh, we have built out the CIP assuming no growth in the value of a penny from FY28 through FY31.

This pie chart shares the general fund's planned pay-go expenses over the five-year capital improvement program.

On this chart, you will see the $58.4 million for affordable housing, street resurfacing, and parks maintenance.

In addition to these dedicated pay-go funding for these areas, uh these three areas also receive funding through general obligation bonds.

The other items listed on this chart are funded through the council's adopted penny for general paygo.

On the next several slides, I will go into more detail on this area.

As mentioned, starting in FY25, the adopted budget includes a dedicated general fund support for projects best suited for paygo funding.

This slide pictures civic plazas shade structures, which were completed last summer as part of the Civics Places program, which is funded through the Penny for General PAYGO.

Dedicated general funding provides support for bond ineligible projects and commits support for external facing programs.

Internally, it allows departments to better plan for project delivery.

In addition to the penny for general paygo, the FY27 budget includes $4.4 million of one-time interest revenue that is recommended to be used on capital projects.

On later slides, I will detail what is funded with this one-time interest revenue.

The first three projects listed here focus on replacement of lighting and security cameras that have reached the end of their useful life and funding to maintain existing city facilities.

Continuing with the city facilities category, these projects, the projects on these slide, do not have funding needs in FY27, but they do have program needs in FY28 through 31.

The CIP also affirms support for external facing programs.

These grants are in the capital budget because the nature of the projects extends beyond one fiscal year.

For example, the city's facade improvement grant, which matches up to 50% of qualified construction to improve the exterior appearance on commercial buildings, commits awards in one fiscal year, but by policy does not distribute the award until after the project is complete.

Projects are often completed in a later fiscal year.

The Impact Partner Grant provides innovative projects to help businesses start, stay, and grow in Raleigh.

And what you have pictured here is the 2025 cohort from the Impact Partner Grant.

This city-led program integrates placemaking elements in public infrastructure projects, and it prioritizes projects from cities adopted plans.

This slide highlights the completed Commerce Place Street Mural and Improvements Project.

Also in FY27, the Office of Strategy Innovation includes one-time funding to support strategic initiatives initiative teams, strategic plans initiative teams.

Over the next five years, $16 million is committed to improvements and maintenance of existing fire stations.

These projects are spread out across fire stations based on the useful life of equipment and best practices for building maintenance.

Picture is Fire Station 7, which recently went through a major renovation that included the replacement of garage doors for efficiency, upgraded Americans with Disabilities Act compliant bathrooms and kitchen, replacement of flooring for waterproofing, window replacements, as well as replace lighting with LEDs.

FY27 also includes building systems maintenance funding for Raleigh's Police's Youth and Family Services Center.

This dedicated location has allowed Raleigh Police to expand their offerings to youth, including summer camps and the police cadet program.

And it has also provided a venue for other community events, including Halloween events and for the during the holiday season.

This project will extend the useful life of this city-owned facility.

Over the five-year CIP, $26.6 million is planned for transportation projects best suited for PAYGO funding.

This includes bridge maintenance, sidewalk repair and improvements to the city's existing sidewalk network, and traffic intersection improvements.

Some of what's included in the traffic intersection improvements is funding to add accessible pedestrian signals to serve persons with low to no site and to maintain repair and upgrade the city's traffic signal fiber network.

As previously mentioned, the first year of the CIP includes the use of one-time interest revenue to supplement the penny for general paygo.

This slide lists the projects that are funded with this source.

I have shared information on most of these projects earlier in the presentation.

The last project listed, historic markers will implement up to 40 markers honoring historic sites, events, and individuals that were highlighted in the completed historic context and fourth ward context studies.

The image on this slide is an example marker completed at the MLK Junior Memorial Gardens, which honors the local activists who designed the gardens.

To recap, there is approximately 16 million dollars that are programmed in FY27 for general pay-go projects.

All right.

Last year, council approved the steady state approach to debt financing and the new advanced planning process for the city's debt funded projects.

In this section, I will provide you with a status update on the three projects that are currently in advanced planning, preview what is slated to be included in FY27, and reshare information on the city's general debt affordability.

I also want to note that this is an image of the nearly completed fire station three, and so excited when that is all complete.

In the FY26 budget, the fire department's first two priorities and the city Southeast Remote Operations Center were placed into advanced planning.

Projects remain in advanced planning until initial or preliminary design is complete.

As shown, the fire training center has completed a feasibility study on an identified property.

Phase one for the fire training center is important to have space for larger and additional recruit classes, which is necessary to implement the staffing recommendations of the Fire Master Plan.

This project will start preliminary design next year.

The combined Fire Station 23 and Northwest Police Station project is determining the building needs, which will then inform the land requirements for purchase.

Once the site has been identified and purchased, the project will enter into preliminary design.

The Southeast Remote Operations Center has initiated a feasibility study on a city-owned property, and based on the outcome of that feasibility study, this project would enter initial design.

The last column on this table provides a very very rough estimate of these three limited obligation bond projects.

I say rough because we have not completed initial design, so it's not until we've completed initial design on a very specific site location that we will have a much more accurate cost estimate.

At that time, staff will return to council through to request funding for the full design and construction budgets.

For the foreseeable future, the city's limited obligation bonds needs are primarily tied to implementing the Fire Master Plan.

On March 10th, you heard from the housing and community development and transportation departments on their proposed calendar year 2026 bonds.

As a reminder, the city's current state current steady state debt affordability is 203 million dollars.

If voters approve the 2026 bonds, budget for spending will be available starting in fiscal year 28.

Therefore, some transportation projects will enter into advanced planning to conduct preliminary design.

This will allow the city to be in a much better position to act on these general obligation bonds if approved at the start of fiscal year 2028.

This information on the slide has been shared at the council retreat as well as at the March 10th council work session.

I want to point out that the city is in our current financial position where voters will be able to go to the polls in November without a needed tax rate increase because last year's city council agreed to move to a steady state approach and created the advanced planning program.

Under the city's prior limited obligation bond process, the city would allocate budget before preliminary design was complete and often before a site had been identified for purchase.

This resulted in debt to capacity being tied up on projects that were not actually ready to move into construction.

Because projects were instead placed into advanced planning, the debt capacity was not held up, which directly contributes to the city's current state steady state debt affordability of 203 million dollars.

If the city uses that full steady-state debt affordability on the 2026 general obligation bonds, and if any of the three limited obligation bonds that I went over are ready to move out of advanced planning, that will require a tax rate increase in FY 2028.

So a few little next steps before I get to questions.

The finance department supported by housing and transportation will return to council on April 21st to provide updates on the proposed general obligation bonds.

And budget and management services will return on May 19th to present the city managers proposed 2027 operating budget and complete five-year CIP.

Thank you.

All right.

Thank you.

Questions?

Counselor Silver.

Thank you for the presentation.

This may be a question for transportation.

So I appreciate what was on the pay-go.

I know at the last meeting we went and did a deep dive into how the transportation for the steady-state bond would be allocated for bicycle and pedestrian, and there were some priority projects listed.

On the paygo, when it comes to the sidewalks, the crosswalks, and all the other elements that you mentioned, I just want to understand how that is prioritized.

Again, I don't want to sound like a broken record, but we're seeing sidewalks fading in paint.

I don't know if they are state facilities or city facilities.

When do we upgrade those stop bars where I think they should go?

So I'm just trying to understand in terms of the sidewalk repair and improvements and the traffic intersection improvements.

We see a lot of money, a lot of paint going to bike facilities.

I don't see the comparable expenditure for or at least attention to pedestrian facilities.

So can you just help me?

And I guess this is a question for transportation.

Um understand how the sidewalk repair improvements are decided under pay-go, as well as the traffic intersection improvements, and as that include painting crosswalks to make it safer for pedestrians, as well as those stop bars, because some vehicles stop right into the crosswalk.

They don't have the stop bar.

Not a question for you, but just want to understand how that decisions are made for FY27 and then for the longer five-year CIP.

We can tell you are passionate.

Yes.

I cannot look I almost get hit twice a week, so I'm just saying.

Cars are not used to seeing pedestrians and cyclists.

Uh but I can speak to how we prioritize all of the capital requests that come in that are unfunded, but in terms of what street intersection is prioritized over another, I would ask my partners from transportation to come forward.

And I will say on the intersections, I was reading through the entire safety plan, and I know there were four intersections named in that plan.

My question is just to piggyback on Counselor Silver.

Is the 1.67 million towards those four priority intersections, or is just how does that all work?

So this actually included the I have created these three categories for the purpose of the presentation today, so you are seeing them in these bigger groupings.

They are actually within it are some smaller groupings of projects.

Um whether it's for the ADA pedestrian signal uh improvements versus for the fiber or for particular intersections being improved, which is one of the things that is included, um, is all grouped within that traffic intersection improvements.

And then the sidewalk repairs includes repairing sidewalks and also replacing sidewalks and also meeting some of our Vision Zero spot safety checks for sidewalks.

And before they stand up, I do want to share some good news because I know Paul Callum, we had a long conversation.

I live in a neighborhood of walkers and they tend to be over the age of 55.

And so we realize my road is a state facility, and after requesting the speed limit be dropped by the state, uh it happened last week, so there is some good news, but they are very vocal.

They're walkers, and so for me it's just something that's not just about me, but it is about uh the folks in my district as well as throughout the city.

So if you can respond to how those prioritizations are made, I would certainly appreciate it.

Good afternoon, Kenneth Richie with transportation.

So certainly Hannah kind of hit it high level.

Um you look at the sidewalk repairs and improvements.

So both of these items are really more maintenance-driven than they are pushing forward on like the Act Mobility Plan or our comprehensive safety action plan.

They will be back in front of you in a couple weeks.

Um crack sidewalks, repairing those, replacing those, uh, handicap ramp upgrades, not only as we see them, but as we resurface roads, we are required to upgrade those handicapped ramps at the same time.

What we are trying to do here is really trying to rectify where we have been using resurfacing dollars historically to try and meet that requirement.

We're really trying to make sure we have got dollars so it continues to make sure that our resurfacing dollars are going to that asphalt maintenance.

Uh, with the traffic intersection improvements, a lot of this is really looking at more had the audible pedestrian signals uh and making sure that we're really trying to upgrade a lot of those as we and some of that does include markings, uh, but really a lot of this is more maintenance driven than it is those those plans which you have approved or will hopefully be approving here in the future.

Yeah.

So I I just need to understand about striping and painting.

Is that is that going to be resident driven or does transportation kind of look citywide about what is some of the high volume areas?

Because like I said, I'm seeing some that are virtually I know six forks of state facility, but you can't even see the crosswalks they've faded because traffic are going over.

Just want to understand for the stop bar.

As well as repaint repainting the crosswalks that already exist.

Is that a maintenance item or is that something else?

So that certainly is a maintenance item, and I believe we were here in September, or we were at Translation Transit in September and had an in-depth conversation about the markings program.

And certainly some of this will help offset that.

Okay.

But it's not going to be able to push it to the level we need to.

I mean, we have estimated about an $800,000 gap in that program to really get to a point where because really, as you look at our markings program, we're really trying to look at the life cycle of the paint itself.

And we tried get there twelve to fifteen years, but the resources we have do not get us there in that timeline, which is why you kind of see that diminishing uh impact uh of the markings.

So certainly those are conversations that we've had and certainly can continue.

Thank you.

I'm sorry.

I just wanted to make sure I heard that correctly from that meeting that you referenced back in September.

We we learned that it that department that caught the markings had a hundred and thirty thousand dollar budget, and you're saying that we're eight hundred thousand dollars behind?

I believe that was roughly the number that we had shared at that time.

Did you share oh I didn't realize it was that big.

Thank you.

Okay.

Uh Mayor Pratem.

Yeah, I just wanted to go back to uh the laws and the potential tax rate increase mentioned in 2028.

Um could you just explain this a little more?

So is this if these are ready to go, this will happen.

Um this is not, you know, related to our transportation affordable housing bond that could be on the ballot this year.

Can you just clarify if I've got that right?

So your total debt affordability currently for a four-year time frame is 203 million dollars.

If you elect to have 203 million dollars worth of projects on the the general and the referendum in November, then that will use the existing capacity.

So if you want additional capacity as a city, you would have to have a tax rate increase to and and I'm not naming an amount here for FY28, because we're gonna be looking at what progress do those three projects that are here make.

So if they're not ready and they haven't completed initial design, we wouldn't be seeking for the budget for the full design and construction budgets.

Okay.

Thank you.

Okay.

Okay.

I don't see any other questions.

So thank you.

Thank you.

All right, we have one more presentation.

I don't know whether we're over or uh if this if this is all timely, but we have the proposed budget outlook.

Ms.

Satar.

Yes.

Um so good afternoon, Mayor and members of City Council.

Thank you so much for hanging in there.

I am Sadia Satari with Budget and Management Services here to wrap up our budget work sessions.

Um you have heard um from a lot of departments, not just today, but over the course of the past three months.

You have heard from our enterprises, you've heard about how we've conducted our engagement process, you have heard from parking twice.

Um, but I'm here to sort of wrap things up and kind of let you know where we stand as part of our base budget in general and really talking incredibly high level about um our property taxes, really highlighting some of the pressures that we have in um on in our budget uh moving forward for fiscal year 2027, how those pressures are impacting our base budget and kind of those next steps uh prior to uh May 19th, as well as actually adopting this budget in June.

So I'm going to kick us off with talking about property taxes.

Again, a really high-level overview.

You've heard from our CFO during the retreat, um, Allison Brad for our CFO described kind of what's happening here at the city level, at the state level, at the county level in terms of our property taxes.

You also heard from the source, our Wake County uh tax administrator who was here on March 17th, kind of giving you um an overview of where we find ourselves.

Um this should come as no surprise to any one of you at the table that property taxes are a most stable source of revenue.

Uh but given some of the things that we are experiencing um here at the city at the county level, um, that doesn't happen to be the case anymore for our base budget moving forward for fiscal year 27.

Um and why is that the case?

Well, there are some budgetary impacts in terms of increased approvals for commercial appeals, increase in brownfield exemptions, as well as um multifamily complexes using a tax loophole uh to use not-for-profit, you know, um funding structure.

So lots going on.

So there is no doubt that we will not be meeting our fiscal year 26 property tax budget.

This slide uh kind of showed a projection.

This was a moving target.

So we may not meet this projection either as we continue to get numbers regarding appeals uh from our tax administrator.

So what does that mean in terms of you know our base budget?

Um it's actually not very good news.

But before we move forward, let's also talk about in terms of property taxes.

What's that done to the value of our penny?

Um so with all these exemptions, with the property tax appeals, commercial appeals, with the affordable housing exemption, our tax property tax base has actually shrunk, which really means that that value of that penny has also shrunk.

So when I stood in front of all of you during the January, you know, City Council retreat, I was assuming was conservative in terms of the property tax growth.

We normally assume a 2% growth.

We were assuming a 1.5% growth, but we've actually had to lower that growth even further as we continue to get more and more information from the county.

And of course, I got to credit our CFO here for keeping budget a price as we go through a very tough budget season.

So again, our current assumption continues that you know we're almost at, you know, zero to very, very little growth in general.

And again, just kind of reiterating that that is not a situation that any local government normally finds itself in because property taxes are a most stable source of revenue.

So what does that do to our base budget?

Uh no surprise that you know we have a lot of expenses.

Um you heard from a ton of departments.

Um we are experiencing for the first time in my tenure here at the City of Raleigh a base budget gap.

I stood in front of all of you in January and I said that I was confident that I would be able to solve that gap.

Given the news that we are continuing to get from the county, that doesn't happen to be the case anymore.

We find ourselves in a $13 million deficit as of just last Friday when I had my folks on their numbers.

Um so we have a big um you know gap.

Um and there remains little doubt that we will need to raise property taxes to solve this base budget gap.

We just can't do it otherwise.

We are taking as many actions as we can on the expense side, but on the revenue side, our most stable source of revenue just doesn't happen to be there anymore.

And this gap is before we do anything else.

Um this is before we do salary increases, we you know, talk about we've talked, you've seen these before.

You've talked, we've talked about these pressures before.

Before we do salary increases, before we, you know, fund DICS, which happens to keep on growing in its popularity thanks to Gibson Play Plaza.

We've invested a lot of money in doing a targeted staffing study to see how our city responds to growth.

Uh we've also invested a lot of funds in a fire and master plan to see, and of course, that has operating as well as capital budget implications.

Um so there's a lot here.

Um, you know, this shouldn't come as a surprise to anybody, but just kind of we want it to be proactive.

We want it to come in front of you, don't want to have any surprises in May when we come and ask for a tax increase.

But all that to say that we will continue to stay on top of the situation.

Now, something else has happened uh before there are two words, the Iran war.

So that wasn't happening when we started the budget.

That wasn't even happening when we were meeting in January to talk about the budget.

So there's a lot of economic uncertainty, of course, with uh, you know, uh rising interest rates, inflation.

There's a lot of things to look over on the expense side as well, as well as the revenue side.

So we'll continue to work with finance and monitor fiscal uh economic activity.

We'll also continue to collect feedback from city council.

Um but I am confident there is no doubt that the city has to present a balanced budget, and we will do that on May 19th.

How we get there, that's a challenge, and we'll meet that challenge.

Uh our first public hearing for the budget is scheduled for June the second.

Um and then of course we have council budget work sessions that commence every Monday um in June till we propose a uh adopt a budget.

So uh possible dates of budget adoption listed here as well for all of you.

And um with that doom and gloom, um I'm open to any questions uh that um you all may have.

All right.

Questions I've rendered you all speeches.

You're dismissed.

Yes.

Yes, you've left us speechless.

Um can you go to the this is not working?

I'm not that that's the one.

Okay.

Couldn't use any words today, apparently.

Um this is a little more than a penny.

That is that's 1.11 penny.

Okay, yes.

A little more than a penny, just to do like literally exactly what we did last year.

That is absolutely correct.

Yes.

And some of the, I mean, last year we we'd put a lot of pressure to not raise property tax, so we know that there are things that didn't get done last year in hopes that we would be have being more favorable circumstances.

So like how I guess I'm trying to understand the size of all the things that are not covered in this, right?

Like to just you get back to the base budget, you do exactly the same thing we did this year.

There are still things that have are going to be rising to the surface.

What's the sc scale of the sort of additional supplementals that go beyond this?

So that can't be put off for another year.

So department directors would argue that nothing can be put up for another year, right?

So let me just give you an example of in the ballpark of what we get every year in terms of supplementals.

We get over 45 million dollars in supplemental asks every year.

Um the fire master plan alone is asking for about 77 FTE for the next year.

So let's be realistic.

We we can't make that happen.

Can you imagine the tax increase that has to happen to just make all of it happen?

But the we are working really closely with the manager to figure out what a measured uh budget would be uh for the upcoming fiscal year.

So, you know, um I can't really give you a number because I'm in the middle of budget uh uh itself, but um that's where we're open to you know hearing feedback from City Council as we uh you know kind of come forward towards a proposed budget.

Yes.

Thank you so much.

Um in mentioning the Iran war and its implications on things like our gas usage, um, our energy usage across departments.

Um how I I don't even know how you can project what that's gonna be, but if if gas continues to rise and rise and rise and every department uses that, this is not accounting for any of that yet.

No.

You're absolutely right.

Yes, ma'am.

Oh, okay.

Cool.

Thanks.

Any other things?

Um first just thank you.

I know a lot of long meetings, and I know we um have our own compressed natural gas, so if we got any vehicles that we can convert, it might save us, hopefully.

Yep.

I know we had a conversation, uh, another shocking presentation uh from Way County.

City manager, do we know?

I know they talked about this Blue Ridge, that affordable housing loophole.

I'm assuming that will not be resolved by the time we have to adopt this budget.

Is that true or not true?

Because I know that that had huge implications.

The others seem to be on a whole different track.

But the one, it appeared that there was some conversation about addressing that blue ridge loophole, if I remember the term correctly.

Do we know where that is or the likelihood of that getting resolved, or if the city attorney knows that response as well because this was a very that was a shocking presentation, and I know it's factoring in to our property tax base.

So we are watching and tracking the activity on Jones Street daily in working with our lobbyists and our partners primarily with Wake County, obviously, to make sure that we're kind of in tandem as we both bring forward our our balanced budget next month.

And so uh I doubt if past performance is an indicator of what future performance will be.

I doubt we have an answer by May 19th.

Um however, I'm hopeful that there will be some decisions made on the state level to help all of us make decisions in our respective budgets across the state, because this holds true for all 100 counties.

Correct, you know, all of the municipalities that are all struggling trying to figure out how we balance.

Thank you.

And just to stay on that, you know, one of the um interventions being knocked around by that special committee is a levy limit, which does not close the loopholes.

It's just a different tool altogether.

Um have you all been evaluating how we would be impacted by a levy limit?

Um but I've the answer to your question is no.

But um what we are doing as the managers said we're continuing to monitor what's going on because that's being discussed in those um special uh property tax committees in both the Senate and the House, and those proposals appear to be in the early stages as to exactly what that would look like.

Um they do have another meeting.

I believe that meeting is April fifteenth tax day.

Tax day.

Tax day.

Yes.

The IRA force.

Yes.

And so uh we will be tuned in as well as our lobbyists is it is planning to be there.

I'm just weighing in just thinking about the General Assembly, but if they do this as a standalone bill on plugging the loophole, I mean, I think you could get something maybe by July passed.

And then the question is, is it immediate or you know, how does that impact all these people in the pipeline, applying for this?

And then there is multiple language for the ballot initiative that they I think will be on the ballot this fall.

But then the question and so we are getting some requests for feedback of that, but I think we'll know what will be on the ballot, and then we need to do our calculations on how that will impact us.

Absolutely.

Yeah.

Lots to unpack.

Yeah.

All right.

Well, thank you for those updates.

Thank you.

Uh Debbie Downer.

All right, and I think that concludes our agenda for today.

So thanks everybody for all the work.

We are adjourned.