Indoor recreation financing options, and then we'll wrap it up with persons experiencing homelessness update.

So with that, I will uh turn it over to Jason Boynton, who is with uh Cohen Resnick, and uh to discuss our audit.

All right, well, Mayor Norton, Council President Schuberging, Council members, um Jason Boynton from Cohn Resnick here to uh review the results of the 2025 audit of the city's financial statements.

Um I've got a slide deck of about uh 50 slides or so here.

Um I'm gonna move pretty expeditiously through them.

We're gonna take kind of a real high level, you know, look at the activity for 2025.

Uh but certainly as we go through, if you have any specific questions, don't uh hesitate to stop me and uh we'll address those at the point.

I do have if anybody needs paper copies, I do have those as well if anybody would like.

So all right, so advance the slide here.

The clicker?

Yeah.

Yes, yes, sir.

Okay.

All right.

So we are issuing an unmodified opinion on the city's financial statements.

Uh many refer to that as a clean opinion, just it means that based on the work that we did, our team did.

Uh, we feel uh comfortable issuing or um saying that the financial statements are fairly stated in accordance with generally accepted accounting principles.

Uh just a reminder for council there are a couple elements within the city's financial report that our firm, Cone Resnik did not uh audit.

Uh that was the electric and water utility funds and the uh DMCC, which is a blended component unit by accounting standards.

Okay, so we uh they were audited by other auditors who issued unmodified opinions on their financial statements, and then we rely on that opinion that they uh on the work that they did in issuing our overall opinion on the financial statements.

Um the city does participate in the GFOA's certificate of achievement uh for financial excellence of financial reporting program.

So that was a program started by the uh GFOA many years ago to encourage governments to go up above and beyond the minimum reporting requirements to provide more information, more detail in their annual financial report.

And so the city participates in that.

Uh we are submitting that for the 2025 report, uh, but we also did for 2024 we received the award, uh, which I think it was the 54th year in a row uh that the city has received it almost back to the beginning of the program, I think.

So that just demonstrates, continues to demonstrate the city's commitment to quality financial reporting.

In addition to issuing the opinion on the financial statements, uh we are required to perform a special federal program audit.

So this is uh procedures that we have to do just on federal grant dollars based on the volume that the city gets of federal grant dollars and a specific procedures, making sure we're in compliance with federal requirements.

So uh we will do that in uh July August time frame, and then we'll issue that report prior to its due date at the end of September of 26.

And lastly, uh we did sit down last week, last Monday with the audit committee.

Uh we went over the results of the audit.

Um we talked about accounting standards, kind of both current and and future ones that are coming and reviewed the auditors responsibility letter.

And I want to thank the uh people that participate in that audit committee for for meeting with us.

Uh that's a quick summary of the audit.

Uh everything went fine.

We didn't have any issues that we feel like we need to bring to council's attention today.

So we like to take this opportunity then since um we've completed the audit procedures to then again take a look at kind of the high level uh review of the finances for 2025.

So we are looking back in the rearview mirror, right?

Uh but it'll give you some context and and uh uh some additional information as you move into your other discussions as we go on.

So we're gonna start out with uh governmental fund types and they're listed there.

Uh your general fund, your special revenue funds, which have specific purposes for tracking them separately, our CIP fund, and then our debt service funds for the bonds servicing of the bonds.

And then we'll switch over to uh proprietary funds, which are enterprise funds, which are the utilities, and the internal service funds.

Um these are both are accounted for differently, they're full accrual accounting versus governmental accounting on the governmental funds, and then enterprise um those types of funds are external customers, so the parking electric are all servicing for or providing services for external customers, whereas internal service funds as the employee uh name implies is is utilized within the government itself.

So just getting her to click forward here.

We can see the slide that internet spot frame.

Okay.

I'll trust it, and you'll tell me if it's not.

All right.

Um, so first chart we're looking at here, chart five, um general fund revenues and expenditures, and just a little housekeeping before we start uh getting into the numbers.

Um couple things.

The most of the charts that you're gonna see are going to be pretty similar, they're they're grouped by year with three different columns with multiple information in each column.

Uh and the columns are generally going to be your revenues or sources of funds, your expenses in the second column, and then uh the surplus or a deficit in any particular fund would be the last column.

Some of the charts we add a fund balance column on there as well.

Um the other thing you might notice if you've been in past presentations.

We did we used to present about 10 years worth of data, uh, but we added you can see there's a table, there'll be a table on every chart with the data underlying the chart.

Uh so that's the information, the numbers underlying the chart, uh, and to comply with the new digital accessibility requirements.

We had to add that, but that took up a little bit more real estate on each slide, so we we decided to uh reduce our presentation from 10 to 5 years.

All right, starting out with the general fund.

Uh so looking at 2025 funding sources uh we're about 133 million for 2025.

Uh that's made up of property taxes, uh, which was about 76 million in the purple and the blue is other revenues, things like intergovernmental revenues, grants we get from the federal and the state, um, license and permit, revenue, building permits, charges for services, uh, the lodging tax, investment income, those are all aggregated in that category.

And then the yellow at the top of the bar there is is in lieu of tax payments uh received from the utilities, and that's detailed out in the third bullet there in the in the descriptions.

Uh so a total of 133 million uh revenues or expenses were about 126 million, and we had transfers out of four million.

So we had about 130 million going out, left us a surplus then in that first bullet of about 3.6 million.

Uh the revenues did see an increase there in the second bullet of about 13 million.

Uh the primary revenue increases were property tax levy was a 7.8 million dollar increase, which is about 11% increase over the year before.

Uh overall, the levy increased by about 10%, but 11% went to the general fund.

Uh charges for services revenue was up about two million.

The some of the big item there were um revenues received for off-duty uh security services by I think police officers as well as planned check fees, uh license permit increase is primarily gonna be building development, building permit activity increase of 1.1 million, and then counting standards.

We had a the police uh department entered into a software arrangement, a five-year software arrangement.

And when you make a commitment like that uh to pay those, it's gonna be paid out over five years, but we're required to recognize the gross revenue and expense in the year of of the signing of the contract or the agreement.

And so that was it's showing as revenue of two million dollars, but then there's the uh corresponding expense of the same amount that's gonna be in the expenditure section.

Uh the expenditures in that next bullet increase by um 14 million dollars, the largest amount there would be in public safety.

That was up about 9.9 million, combination primarily of police and fire.

Uh fire was up 1.2 million, but police was up $8.5 million for the year.

Um, part of that $8.5 million is that $2 million software contract that we are required to recognize.

But then the remainder of that, a big significant chunk of that was employee-related costs, uh, which included normal wage increases, but we also did market uh adjustments during the year for those in the police department.

Um, and then public works was up 1.7 million, that was primarily maintenance related, and then general government 2.1 million, uh, which about a million of that was bold forward on bound related costs, and then information systems and human resources were each up about a half million.

So the surplus then for the year was about 3.6 million dollars.

Uh that increased the fund balance, then um did click forward.

You want to run it for me?

Okay.

Uh did increase our fund balance from 50 uh about 54 million to 58 million.

Uh but our expenditures with that increase in police uh costs and other costs uh increased at a larger percentage than the fund balance percentage, and so our total percentage dropped from 48 to 46 percent on the 2025 expenditures.

Our policy is 42 percent now, less than five months, or obviously above that.

Uh but if we also look at another metric in that last bullet there, um if you look at the fund balance at the end of 25 compared to 2026 budget expenditures, we're right at that 42 percent.

So if we're looking at it at compared to next year's expenditures.

If you want to go in the next chart, um one of the reasons we set that 42% range.

Uh, there's several reasons, but one is for cash flow purposes, and uh this chart just demonstrates that.

So property taxes, which is major revenue source within the general fund, only comes in in June and December.

So we have to fund all the operations of the government.

And so this just shows you the cash balance within the general fund each month until the dollars come in for tax levy and start the cycle over again until levy dollars come in.

So that's one of the reasons that we set that 42% target.

Moving on from the general fund, special revenue funds.

Again, these are all listed here.

We don't have a chart necessarily on all of them, just on the larger ones.

If you want to go to the next chart, so we'll start out with the library.

Library revenues this year were about 10.4 million.

Expenses were pretty similar.

So the library operated at a surplus overall of about 36,000.

So their fund balance didn't change much.

Went from 3,621 to 3,657.

The revenues for the library are primarily from tax levy.

So in the blue, there property taxes.

And then in the pink color, that would be county levy.

And just in that third bullet of reminder that the county levy is only levied on properties outside of the city.

So we're not doubling up on levy for the library.

And then user fees, so not a lot of user fees generated, but about a half a million dollars in the green at the top.

So their fund balance ended the year at about $3.65 million dollars, which is about 35% of their expenditures.

Next up is municipal rec.

Municipal recluse all those activities in that first bullet there.

So rec center, golf, parks.

So this is all of it combined together.

Then we'll we'll break down into a couple of individual departments within there.

But overall for the fund for municipal rec fund, we had revenues of 17.5 million, which is about 11.2 million in property taxes, and then $6 million in fees that we charge for all for those activities.

And then expenses were about 16.8 million in total.

So we had a surplus then of about 627,000 for the year.

That increased the overall fund balance from about 3 million up to 3.7 million.

That worked out to be about 23% of expenditures.

And so I think this was one we've kind of been monitoring.

So back in 2021, after some years prior to that, where we did some transfers out for capital purposes, we were at about 14% of fund balance.

Well, we we've increased about 9% over the last four years.

So that's uh up to 23% at the end of 2025.

So drilling down then within the next.

Okay.

Um of the departments, excuse me, my screen's not matching up with that, so confusing.

Uh recreation department.

So revenues.

So the green are the user charges, so that's what we can charge for operating out at the rec center.

Uh the dark blue obviously is expenses, and light blue is property tax levy.

So if you look at it, the what we charge there doesn't cover the cost, so we have to allocate levy to help support that.

So revenues were 1.8 million expenses, 1.7.

So we have enough allocated levy for 2025.

And we had about $99,000 surplus after property tax support.

If you go on to the next one, Graham Arena.

Graham Marina is a little different in that the um the shortfall, if you will, between user fees and costs are split equally between the county and the city.

Okay, so the city uh levies property taxes based on what they expect their contribution is going to be for the year.

That's in the blue.

The yellow is what we charge the her allocate to the county for the the deficit, and then the if there's a little shortfall there, that's again the city contribution, meaning we didn't have enough levy to to cover those costs.

Uh revenues were um we did see an increase in user fees there, about 100 840, or excuse me, 100 and 20,000 up to 842,000, uh, but our expenses were up as well to offset that.

Next up is Gulf.

Gulf is again revenues in the green, we're about 2.1 million.

We do levy about 275, 274,000 in property taxes there.

Expenses were higher in 2025, so our deficit was about 243,000.

Uh, we looked at that expenditure increase, uh, was related to primarily employee costs.

They um uh implemented new software, they did additional advertising, and then the uh we'll look at this when we get to the equipment revolving fund, but their uh charges for uh vehicle and equipment uh charges were increased in 25 as well.

Uh their revenues, then the 2.1 million does cover about 80% of their costs overall though.

And then last in the municipal rec is park forestry and parkway maintenance.

Uh so their revenues predominantly we don't charge a lot for using the park system, so property taxes help to cover the costs of maintaining uh the parks, and then we do get a little bit of user fees of about 500,000 there.

Uh but the amount of levy that we allocated um was in excess of what we needed uh by about 999,000.

You can see in that last bull.

So that's municipal rec.

Uh next up is airport, airport.

So this is just the operating revenues that we generate out at the airport.

Okay.

So the red represents commission revenues, which is primarily parking lot and car rental commissions.

Um, and it amounted to about 2.5 million in 2025 up from 1.6 million in 2021.

But just for some flavor, if we go back to 2019, which isn't on the chart, but our commission revenue was about Mr.

Boynton.

Can you hold for a minute?

I just want to I I had some questions on parks.

If is now's the right time, or should we wait?

Nope.

I again sorry, go ahead.

Yeah.

I I I want to understand just when you um there it seems if you go back to your original.

There's these are subgroupings underneath the overall um municipal rec and then there is that fund balance there.

But I don't think the individual sub pieces have their own fund balance.

I don't know.

Do they the individual sub pieces do not all have their own fund balance?

Um golf would be the there's a few that have are an exception.

Could you state that again, please?

Yes, I can.

So the individual subgroups do not all have their own fund balances.

Um recenter, golf, graham arena national volleyball center would have their own fund balances.

Okay, and then they show up in their own fund balance, or are they reflected in this municipal rec balance?

They're all rolled into municipal recommend when it comes to looking at the financial report.

Okay, and management wise, this is controlled at the park board and the park uh uh superintendent, and whether whether funds get taken out of um recreate out of uh municipal rec fund balance, that would be decisions by that board and by that, or is that where is that controlled and when the spending is out of the out of the municipal rec fund balance?

What is the business control?

Mr.

Whitman Mike or doesn't count there.

The few times that we uh do request uh fund balance, it is presented for the park to the park board for approval.

Okay.

I I mean I'm gonna note that it's really nice to see the fund balance come up over the years.

It it makes me feel like we're under better control than we were.

Uh, but the one that I don't understand is gram arena because this is an area where it's we are sort of like helping someone else run a facility, but then when we do deficit spending, I'm unclear how that works.

Does that come out of our fund balance then?

Or how does that work when it's somebody else's initiative that we're working with?

I'm trying to understand the um I understand that there's nominal uh levy that goes into it, but when I see us running deficits, I'm unclear if that's above and beyond what the levy spending we're doing is or where that comes from is come out of the rec um fund balance.

That uh well it reflects the agreement we have.

We do we do at the end of the year, we uh we share the deficit, and uh uh if there is a if we in many years we we uh go beyond or we we actually are profitable, and uh that's also reflected in the agreement how that is divided.

Okay.

Um let me I'll step away from this.

I'm just I I I understand as we went through the different groupings, but this one feels different because this is not an area that we run and control.

It's somebody else's running it.

So this idea that it appears that we get revenue from the county.

I I I can't get my head around it, but I I'll leave it for separate.

I just wanted to bring it up as just to make sure I understand it.

And factually, I guess I don't right now.

So I'll I'll do a follow-up with that.

Thank you.

If I could just add just real briefly, um so the way we present the chart, um, we show what the actual tax levy was that we originally decided before the year even started.

Yep.

Okay, that gets allocated.

So we don't show the city putting additional money in to cover their 50% share.

We just show that as being uh we didn't levy enough.

That's why you see the deficit.

But that deficit is split equally between.

Now, if we want to go back to the agreement and have that discussion about why we're covering part of the deficit, but that's the way the agreement was written.

I I guess my problem is if this is a program that's run out of the rec fund balance, then I could see us that balance going up and down based on this agreement.

What I'm struggling with is that I feel like it's the county property that's doing that operation, and we're providing the the labor or the expertise for running it.

So I I'm uncomfortable with that.

Uh how the how that ends up drawing money out of that fund balance where it's not levy spending, but it is city money going to there to run an operation.

Do you want me to explain more or not?

Clear it.

There's a question, but not an answer.

This agreement and versions of it go all the way back to 1970s.

I think before that, I think there is an agreement all the way back from like the 50s.

Uh so we jointly built the facility with the county and the hockey association or whatever it's called, Minneton Rochester hockey.

Uh we operate the facility.

We sh the county currently pays all of the capital, like and reinvestment in the facilities because they own the facilities.

The city share does the operations.

We have control over how we're operating to a degree, but we also are required to operate relative to this series of agreements and all the funding sources for building the facilities.

And we could jointly change the rates, et cetera, um, to charge more.

But some of this is unrelated to like this is whether we were operating it or the county was operating it, there I think there one of these years has the purchase of a Zamboni in it.

So some of those operational expenses and those are shared with the county when you go over.

So I appreciate your con you not loving how it works.

However, it probably is muting the cost because you have no capital cost in here as far as the facilities.

So like if you owned the facility and operated the facility, then we would also have capital cost unless we had some sort of an agreement where someone else paid for all of the capital.

Um so that's part of that sharing agreement is that the facility investments happen through the county.

Okay, last question.

Would it be fair when I look at this chart and I see the negative uh $19,000?

Does that come out of the rec fund balance?

And where does it go to?

Does it go to I mean, I there must be some concept of a group that runs the rec center, and I think that's the county.

But the city operates the rec center through the parks department.

The county owns the facilities.

So that black not levying enough for the total green, yellow of to the big blue bar.

Yep.

It just goes to any of the expenses within the blue bar.

We could probably isolate exactly what that was, like maybe cost of emplo employee services.

We maybe someone left and wasn't taking health insurance, someone can't, we always budget for that, but like there could be an employee payout because somebody retired, for example.

All right.

I uh I I think I I think I understand it is a unique beast, and I'll go from there.

Council member Miller.

Yeah, just following up on these fund balances.

I'm glad to see the balance going up too, but it does seem like the property tax support is going up faster than the fund balance.

So I'm just curious, uh, like some of the other ones.

Do we have targets for the municipal rec fund?

How are you deciding how much additional property tax levy?

I know it breaks down into other areas, but it does feel like we're just transferring property tax levy at a higher rate, which is making the fund balance go up for the overall.

I mean when the general cost of service goes up, generally the main source of revenue that you have to cover the cost of those services is tax levy, unless there's an opportunity to increase the fee revenue, and at some point the fee revenue has to also meet the market.

So if the fee revenue is too much, for example, if we had a scholarship program for folks, that the place where you would likely be able to raise funds for that is through the tax levy.

So, or you would need to shorten the hours, utilize it less, have less employees, have less level of service, things of that nature.

So as employee costs go, like some of that is probably just the cost of employment going up.

Not saying that that's simple, but the the reality is to mute that you would end up needing to have it less available, more fee revenue.

Or I guess looking at one of these facilities, the rec center, you see property tax support going up, customer charges going down, direct expenses up, and we still have an excess after tax support.

But how do we look at the performance?

You uh we uh we adjust or look at the fees and programs that uh are going to be offered during the upcoming year and set our performance measures during that time.

Uh generally we present that in front of the park board and um and uh we as uh administrators elms mentioned.

We we do take a look at the fees, but we're very careful to not outpace that above what uh the residents uh water community can uh uh offer uh to offset the cost of the programs.

And then I guess from a performance standpoint, do you look at subsidy per user at any of these areas?

Yes, we are working on uh that's one of the things we're working on right now is to set a uh revenue policy as it uh reflects on every program and uh that policy looks at uh you know, focusing on youth and senior programs as kind of the uh most subsidized activities that we offer as well as the park system in general, keeping that as use uh fee uh uh free as possible.

Uh and uh then we you know tier upwards when it comes to golf tennis and other activities.

Sure.

And as you develop those, would we expect to see just updates on kind of the level of tax support going in per user kind of understanding?

And the the reason I ask is because I mean most of these graphs look fairly stable over time, but it looks like golf operations is taking a dangerous shift upward faster than some of the other ones.

And I'm just curious again, like how we're looking at levy subsidy per user of that area of rec.

Yes, it's it's not reflected in the information you've received thus far.

Uh we do a report to the park board annually showing uh our um cost per activity as it relates to the luggage we receive.

I think it's just also important to note that 2025 is likely an anomaly because we had an employee that was out on a extended medical leave, and then also an a retirement, so there's a payout that's in there, and there's also temporary positions that backfilled that position.

Okay, just to add to council member Miller's point or part of his point, which I heard was from a council standpoint, if we're looking at the property tax support and we're looking at the customer charges, and if we see an imbalance there, we're that's where we're gonna we're gonna dig in.

And I think from a council standpoint, whether it's this fund or other funds, if there's some way that we can have a dashboard where we can see how much uh levy support we're giving and how much uh how much uh fees that we're getting uh getting for that, and if there's a a disparity there, we that's where we're gonna ask questions.

So with that, I think we were on the airport.

Okay.

So I was on chart 15.

So uh I'll just kind of start over there.

I think I was into it a little bit, but uh the red represents commission revenues, uh, two and a half million dollars in 2025.

Uh that's primarily parking lot and car rentals.

Uh I was mentioning that in 2019, our commission revenue prior to the pandemic was about two and a half million dollars.

So we've just gotten back to where we were pre-pandemic, but passenger traffic is not gotten back to where we were pre-pandemic at the airport.

So that's just generating additional uh fee revenue uh to get back to that point.

Uh land and building rent in the yellow, uh, that was 1.7 million landing fees in the green and 1.1 million.

Uh that increased from 23 to 24.

They instituted a new general aviation landing fee, which they didn't have previously.

And then the gray, I just want to point out is um other revenue, but it's primarily in that uh second to last bullet there.

We got federal funding at the airport uh following the pandemic to help supplement costs there.

Uh and it's been around one point one million each year.

Well, 2025 is the last year that they're gonna receive that funding.

So that so next year when we look at this data set, um, it's gonna look a little different there.

Uh the chart uh airport operations overall on chart 16, then so revenues again, the yellow is the operating revenues that we generated at the airport.

I just showed you on the previous chart.

Uh, we do levy about 600,000 toward the airport uh in that bullet there to cover the cost of utilities and customs.

Uh the expenses in the blue, we did a transfer out of about 400,000, I think for some hangar purchases, uh, but we ended up with a surplus of about a million and a half that then increased our fund balance on the next chart.

Uh and the airport currently has about 15.2 million dollars in fund balance at the end of 2025.

And this is just the operations fund.

There's a separate airport related CIP fund included in the capital improvement uh fund.

So that was airport moving on to transit next.

So transit revenues in 2025 were up slightly at 15.5 million in total.

Our expenses were about 15.1 million.

We had about 350,000 surplus in transit that increased the fund balance.

So here's one where we added the fund balance in gray to 5.6 million.

Um we look at the breakdown of the revenues, uh, just a reminder transit.

There's no property tax support that goes toward transit, it's all funded through federal and state grant dollars, uh, as well as rider fees in the orange and then investment income, uh, primarily in the other income in the green.

Uh so about almost just shy of 90% of the cost of transit is covered through federal and state grants.

Next up is the bioscience center.

So this is floors four through eight, so the lower floors were TIFF related.

Uh, this is four through eight.

So we generate rental revenue there from net operations, and then we use that to pay debt service for the construction of the building.

So rental revenues were 2.6 million, roughly about the same as the year before.

Uh, and uh expenses were up a little bit at 1.7 million, so we had a surplus before we transferred out, which is the orange section for debt service.

Uh we did increase that transfer out in 2025 by about a half a million dollars over the previous year to help pay back uh interfund loan between um the the bond fund and the parking fund when we did a defeasance a number of years ago.

Um, and so that'll happen.

I think I don't know if that's gonna be over three or four years, that that'll uh probably be be paid back.

Fund balance still, though, after that extra transfer was at 2.5 million at the end of 25.

So those are the special revenue funds that we are covering.

Uh next up is debt service.

We're just gonna look at these are all the individual bonds, uh just kind of the outstanding balances of those bonds.

So the first chart on 21 is our EDA, so these are bonds issued by the EDA.

Uh, they were for primarily for the Bioscience Center, uh, those top floors, as well as uh we issued in 2020 a bond for the development services infrastructure center in the North Precinct.

And so we're paying those back with rents in the case of the Bioscience Center, and then uh through um levy to support the lease payment between the EDA and the city uh for the other bonds.

We owe in total, combined between the two, about 22.6 million.

Uh 2009 bond we issued.

This was for the TIFF portion of the Bioscience Center, uh, and we were able to pay that off in 2025.

The TIFF bond of 2017 uh was issued for uh construction of parking ramp six, um, and we're paying that back then with combination of increments as well as transfers from the parking fund.

Uh, that's paid down to 15.7 million at the end of 25.

Uh we issued in 2010 some build America bonds for construction of the public works and transit ops campus.

Uh we refunded that in 2020, so that's the bond we're looking at here.

Uh, we owe about 13.2 million, um, and that'll be paid off in 2036.

Uh, we have lodging tax revenue bonds for the Mayo Civic Center expansion that were issued in 2015.

Uh, we paid those down.

We owe 22.7 million at the end of 25.

Uh that reduction in 25 you can see was larger, as we did have an additional principal payment that we made of about 5 million.

Sales tax revenue bonds for the uh last sales tax authorization.

Uh they were issued in 2015, and we were able to pay those off in 2025 as well with sales tax proceeds.

And lastly, we've uh last three years we've issued abatement bonds in 2023.

We issued bonds for park improvements at the pool, soldiers uh field pool, silver lake, and other park improvements, and we're paying that back through that extra two million dollar referendum levy that the parking rec uh gets.

Uh, the 24 bonds were issued for the geothermal improvements that we did with the city buildings, and then the 25 bonds were issued to uh relocate the park maintenance building out to the public works and transit ops center.

That was the only new bond issue uh this year was about 11 million dollars.

Sewer project has a big project going on, sewer fund um that is drawing more debt down, but it wasn't a new debt, it was already established.

And then lastly on the obligation side is um just an informational chart for the net pension liability.

So the city participates in PERA for the employees.

Uh it's a multi-employer plan.

All the governments participate, and county standards say that if they're underfunded or overfunded, we're required to show that on our financial statements.

So it's our pro-RATA share.

They do an actuarial study every year.

Uh but I'll just point you to the funding percentages in the last bullet there.

They're based on their last actuarial study, which was last June.

Uh, they think they're over 90% funded for both the general fund and the police and fire fund.

Next up is capital projects, or CIP fund.

Uh, this is just the fund balance, so the fund balance didn't change uh significantly.

Uh it was 311 million for both years, uh, but there was a lot of activity that happened during the year.

Um, so some uh dollars were spent, some were brought in.

Uh so that bullet there lists out the of that 311 million.

This is kind of where the dollars are earmarked for, uh whether by council or whether restricted.

Um significant changes during the year.

We spent about 14 million down in our infrastructure sales tax projects uh balance.

We spent about 9 million in highways and streets down.

Um this is just the reduction in that set aside.

Um parking rec was down 7 million, uh, but they were all offset by DMCC, which had a 32 million dollar increase in that balance there, and that's sitting at 152 million uh at the end of 2025.

Okay, enterprise funds.

So we'll start out with parking.

So parking uh revenues you can see there were about 10.6 million.

That's made up of user fees of about 9.7 million, which was an increase of about 1.65 million, uh, and that's in both ramps and in non-metered uh parking.

Uh so we had a change in our rate structure uh that occurred, which was in part parceled to the increase in the revenues there.

Uh expenses were up a little bit as well, 7.2 million expenses, they have their in-luate tax payments of $800,000, and then debt service, as I mentioned earlier, they're they're transferring out to the bond fund to uh support the debt service on the parking ramp six construction.

Uh surplus then for the year was about 1.4 million, which added to uh their unrestricted net position, which they have about 15.5 million at the end of 25.

Next is electricity utility fund, RPU revenues there were 218 million, made up of retail, wholesale, steam, and capital contributions.

Expenses were 172 million, so they had a surplus of uh 46.6 million in 2025.

There was a 4% rate increase, uh growth in customers as well.

If you look at water on the next chart, then uh water revenues uh increased quite a bit, but it was primarily in two areas.

Uh one is in the in the pink, there are other revenues.

They they receive some settlement income during the year uh that uh added to there, uh, and then a uh capital contributions at the top, which is a combination of uh developers who uh pay for infrastructure and then contribute it to the water fund for them to take care of after that, or the city also does that where we pay for it in the CIP and then we'll transfer some of it to the water.

Expenses were up a little bit.

We had a surplus then because of that increased capital contributions of about 14.5 million in water.

And then if you look at the next chart, their cash reserves.

So the purple represents their unrestricted cash investments for both electric and water, which was 162 million.

And if you want to compare it to their total expenses, they had 185 million.

Um of the 162 million in cash, about 146 is electric and about 16 million is water.

But on the electric side, they are building cash reserves, I think, toward uh the end of their contract with Simpa and the capital needs that they're gonna have moving forward there, as well as servicing their existing debt.

Um, and I think they have some significant capital that's gonna take place in 2026.

Sewer utility, um, so revenues, operating revenues in the orange, other income in the green, and then capital contributions again, developer and city contributions expenses.

So total revenues were about 50 million, expenses were about 23 and a half.

Uh so we had a 26 million dollar surplus, including those capital contributions and other income.

But if you go to the next chart and take a look at so the green represents our cash balances there, and uh yellow is our operating expenses, but the cash, even though we had that surplus, we didn't see it necessarily in cash because they have a pretty significant project going on there with the revitalization.

Um I think it's a 90 million dollar project.

We're issuing debt for about 72 million of it, uh, and then we're gonna cover about 18 million of it within the the fund reserves itself.

Stormwater, uh their revenues haven't had a rate change for a while there, so but um we get uh user fees as well as investment income in the green, which is in the primary portion of the other revenue, and then capital contribution again from developers and city uh and so that fluctuates from year to year.

Uh and so that fluctuates from year to year.

But for 2025, we had about 15.5 million in revenue and a surplus there, about 6.7 million of that.

Uh now in their case, they didn't have as much capital needs.

So if you look at the next chart, that that surplus uh actually added to their cash balance as it increased from 32 up to almost 36 million dollars.

Um, depending like 2024, you didn't see they had a surplus as well, but they their cash balance stayed about the same because they spent over four million dollars in projects.

But in 25, we only spent a little over a million dollars.

We'll wrap up our fund review with uh internal service funds.

So chart 41 looks at equipment revolving.

So the yellow represents departmental charges, so that's what the departments pay to the equipment revolving fund.

So on the department side, that's an expense, it's a revenue over here and the equipment revolving, and then the green represents equipment acquisitions.

So we spent 3.7 million in equipment acquisitions, uh, listed out the major items and the dollar amounts in that last bullet.

Uh, but our departmental charges, and I think this has been a concerted effort as well.

As we looked at equipment revolving and the reserves that we have there and the impact of inflation, and especially in public safety area and the cost of replacing equipment.

So we've been adjusting our formula for how we're charging out the departments uh to do two things.

One, keep up with existing and cost increases as well as kind of make up for uh getting maybe a little bit, I don't know, I wouldn't know if you know if you'd say behind, but we just looked at where we were relative to what we think it's gonna cost to replace and realize that we we're gonna need more there.

Uh so with that, we'll look at two charts from now.

The net position increase then by about a million dollars.

Uh the next chart is similar, that's just covering information technology.

Uh departmental charges weren't uh increased as much.

Uh they're at 3.4 million.

Uh acquisitions this year was 2.7 million, so we did increase our fund reserves there as well.

And then if you look at the next chart, um that revolving fund balance, we've increased it from we were at just above eight million in 2021.

Uh we ended the year at 12.3 million, which is about a million dollar increase.

And then ITRF ended at 9.3 million as well.

And last, the uh self-insurance fund, and uh the green represents cash and investment reserves, and then the blue is the net position, which the difference is basically an estimate of what the accrued liabilities, accrued claims, and OPEB obligation are that are funded through that fund.

But I'm focusing primarily on what our cash reserves that we have there, and that did increase by about 2.2 million dollars this year up to 38 million.

Uh if you look at the next chart, then departmental charges uh in the yellow there, we're about 32.6 million.

Our benefit expense uh was about 29 million.

Um, and so that we did have a surplus, which increased that cash reserve.

Uh that third bullet there lists out the charges, so we've been um annually increasing our medical charges uh and by those amounts it was five percent for 2025.

Just a few charts left then, uh market value, taxable market value.

So we're kind of looking at revenues, overall expenditures of governmental funds on these last few charts.

So I put this chart in here to just uh highlight what's going on with the city.

Obviously, we're a growing city uh with development and so on, so the mark tap taxable market value is increasing.

We were up 6.7 percent uh this past year.

So keep that in mind as we look through the uh revenue charts.

So this first one takes a look at uh all revenues at the government fund level, so it doesn't include the utilities, but uh the first one is property taxes.

So we as I mentioned earlier, we had about a 10% increase in the levy, so that increased our collections from 100 to 110 million.

That does include the two million dollar uh park referendum uh levy.

Tax increments were 11 million dollars, so about 10 percent of our overall levies uh in those projects until those are completed.

Uh non-property and sales taxes uh it's 37 and a half million, so about 25 of that is sales tax, about 12, 12 and a half is lodging taxes.

Uh LGA, just it's a small amount.

We continue to include it on here, but uh if we went back years, it was gonna be a more significant portion of the budget, but due to the formula and the growth in the city, um we're getting less than we were in 2021, and I think it goes down again a pretty good amount for 2026 as well.

Um then in lieu of tax payments, which would be those utility payments, which are 15.4 million.

Charges for services were 19 and a half million in total, and again, that's across all those activities and departments.

Uh federal, state, county, school, so basically all of our governmental revenues from other governments besides LGA, uh, that was 108 million.

Part of that's DMCC impact of dollars coming from the state as well as the grant dollars for the airport runway project.

Investment income, so investment return has been better the last few years.

This includes fair market value adjustments for the investments, but that was 18.5 million, and then other revenues are gonna be things like assessments, building permits, the rents we get at Bioscience Center, and then other miscellaneous revenues.

It's higher than previous year, but one big item in there would work credits that the city received for their converting from their steam to their geothermal project.

They were able to apply for credits, and they received those in 2025.

On the other side, our outlays or our expenditures on chart 49.

So general government there was at 22 million.

We talked about that in the general fund.

Police fire, public safety.

If you add those three categories together, it's about 77 million we spend in public safety, which is about 43% of the overall expenditures, excluding cap outlay and debt service.

Airport was six million, 14 million in transit.

Chart 50, then we have park and rec, 16 and a half million.

Culture, which is the library, but also includes like music, art center, theater was about 12 million, economic development and tourism was 10.5 million.

That that includes the cost that we pay to the experienced Rochester to run the Mayo Civic Center as well as other economic development.

Public works was 19 million, and then community reinvestment on the allocated was 1.3 million.

Next chart, um, so this just takes a look at primarily property taxes here because LGA has become such an insignificant component to the overall budget.

Uh but we included it on there, used to be a more significant component, but property taxes.

So what we've done is taken the property tax collection amounts and divided it by the uh population estimate, and it is estimate.

We don't need to the census every 10 years, but estimate of the population increase, and then the CPI for inflation.

Uh so if you look at compare 24 to 25, we did see an increase there of about 70 dollars.

So we increased the levy about 10 percent, but the population estimated population growth is only about one percent.

Uh and then the CPI for the Midwest region was about 2.7 percent.

So you can see the increase in the levy outpaced those two uh factors.

Last couple of charts.

Um so the city's required to report at the government-wide level, uh, which is a full accrual for all activities.

So all the fund stuff we looked at is a current measurement focus of accounting, and then the enterprise funds are full accrual.

Well, they said we got to do it for all.

So if you want to go to chart 53, um there's a statement in the report that basically highlights the expenses, which includes depreciation of the assets that we've uh constructed and built and paid for uh on a full accrual basis.

Then there's program revenues, meaning we get fees uh specifically for these activities, and then we'll also get operating grants or contributions or capital grants or contributions.

It comes to a net cost or a net surplus, and then those are covered with general revenues, which is things like property taxes and and uh sales tax and LGA and so on.

Um so if we just go to the last chart, then chart 54.

So if you look at um the activities, the departments that we have, transit airport, economic development, so on, those activities, transit and airport, either generate their own revenues or they um uh get federal grant dollars or something to support those.

So there's not a lot of local general revenues of the city that are going to support those activities.

Economic development happens to be DMCC is grouped in that category.

But then you look at the last five, and those aren't able to charge specifically uh users for those services, so we support those through property taxes, and so that's the dollar amount, the largest one being public safety, uh which is about a $56 million net cost.

Uh just a note on public works.

It there was a larger increase in 2025.

That was primarily related to um uh contribution that the city made to the county out of the sales tax authorization.

There was a commitment there.

Um I think it was even was it the last one or the one before that?

But there was about 10 million dollars that was contributed to the county for infrastructure.

Uh so last chart summary.

Um so general fund looking at unassigned fund balance.

We're in good shape there.

46% of it, 25 expenditures, 42% of 26 expenditures.

Uh library fund ended at 35% fund balance.

Saw improvement in municipal rec up to 23% as we discussed.

Uh airport has 15 million in fund balance available for their local match for construction projects.

Same with transit.

Uh the CIP uh 311 million set aside as part of their CIP plan.

Uh we have the one bond issue for the um relocation park maintenance building.

Uh parking has 15.6 million in reserves, electric and sewer both increase their reserves uh and they're servicing their their uh outstanding bonds.

Uh saw an increase in self-insurance, cash reserves about 2.2 million, and uh equipment revolving increase from 11.3 to 12.3.

So I guess I'll see if there's more questions.

Any questions?

Councilmember Miller.

So I I know you talked about this a little bit at the beginning, uh, about that more striking increase, particularly in police.

Looking at slide 49 for the actuals, where did the budgeted 2025 come out?

I know in the past we've budgeted lower for overtime, and then it's come out actually higher.

So can you talk about like any impact from police overtime or unanticipated budgeted expenses?

Yeah, so you correct me if I'm wrong, but I think we finished under budget in police overall.

So it was a planned increase, but we we had a couple of things like the Sabida, which was um the subs or subscription-based IT arrangement that was not really anticipated as part of the budget, because that's more of a accounting reporting entry.

Yeah.

Um, but I think uh over time we may have been a little higher, but we we did also get um additional revenue sources to offset that from the off-duty um security services that's the police were providing.

And I guess uh question for finance uh where would the 2026 budgeted bar end up in that chart?

Is that like a new baseline where or where are we uh for the 2026 approved budget of that police bar on slide 49?

It looks like it's around 46 million and 2526.

Yeah, so like is that a is that a new normal, or is that just going to be a blip when we look at it in future years?

Um I would say two million of that is a one-time okay increase.

Yeah, but the rest is the rest of it was employee costs, and that I mean some of it might have been overtime, but I think the market rate adjustments from what my understanding was in our discussions, um was fairly significant.

Okay, there was a five dollar an hour market rate adjustment so forty-four million is a new baseline reset.

I'm looking for that in the budget right now.

It's a different document.

If you're looking at the budget book, it's multiple departments you gotta add together too.

So it makes it a little bit harder because we combine this for reporting purposes.

Um I think they could probably get that to you.

We can we can discuss that in the next item as well.

Any other questions on the audit?

Seeing none, thank you, Mr.

Boynton.

Great job as usual.

Thank you.

Thank you very much.

I appreciate it.

We will move on to our uh uh item A2, which is the 2027 recommended supplemental budget.

Miss Selms.

Uh, Council President would be okay if I sat here since we can't actually view it on that.

You are you are fine where you I don't want to struggle with back and forth.

Can you hand me that?

Yes, thank you.

Um try to make sure I'm talking in the microphone.

And now I just need to open my PowerPoint.

Just give me one second.

We are five minutes ahead of schedule.

Great.

That means I can try to get us 15 minutes ahead of schedule by the end of this.

It's a beautiful day.

It's not just dependent on you.

All right, we are here to talk about the 2027 recommended supplemental budget.

I will try to use a more exciting budget voice than I have in the past.

I've been told by several people that it's very tiring to listen to my budget presentation.

So try to keep everyone engaged in the first um detailed look at where we're sitting with the recommended supplemental budget.

A couple of things that would be helpful for you to be considering doesn't mean you can't consider other things.

Um, is whether or not um we want to continue to fund streets at the level that we had increased it to when we isolated the local government aid there, about 1.2 million dollars, or it could be another amount if people aren't as comfortable with that.

That would be increasing the levy beyond what is represented here.

We would need to know that sooner than later because once you establish your preliminary levy, it can go down or stay the same.

It cannot increase in the next year.

Also, whether or not you would want to implement a convenience fee on credit cards.

We do not have all of the details on exactly how we would recommend this.

Finance is actively working on that.

But if we want to absorb it in the general in the levy funded funds, I would say that one of the things that increases the costs at golf, for example, is the credit card fee.

Now it's gone completely.

I don't know.

There it is.

Good review.

Thank you.

And then is there any, do you have any other additional feedback about the 2027 or their decision packages you would like more information about, et cetera.

So just also we do try to focus our resources surrounding the strategic priorities and foundational principles, but we're also trying to operate as a city.

So some of the things that you talked about in the audit are things you could consider in the budget.

But we also have to consider, for example, if revenue increases beyond the market, you may actually get less revenue if you have less users of a facility and be utilizing more levy in order to offset because when there is a market for all of these things, and we have to be cognizant of that.

Just a reminder, we've been working on this, and a big thank you to Rachel Hodick, Josh Doer, uh Eston to Brian, Aaron, uh, and all the department heads and budget gurus that have been working on the budget since February.

Um, really, they've been working on this budget since February of 2025 because that this is the second year of a two-year budget.

Um, the last time you were here talking about budget was on April 13th.

We did cover a few of these things.

Um, and then uh we're here to review the audit and the budget.

Um, two wonderful financial topics on the same day for those who love it.

Um, and uh wow, this is gonna be interesting.

Um, did just want to remind you, we currently have scheduled for you to um have several more study sessions, so we have time, but it's helpful to be able to delve deeper if you want more depth on the 24th of August and September 14th.

And then um again, I mentioned approval of the preliminary levy is scheduled for September 21st and a budget hearing to adopt the final budget scheduled on December 7th.

Um, so the supplemental budget process really focuses on things that we either weren't planning for or um things that we need to adjust, um, minor things.

Um, so really revisions, not significant changes, um, although you are absolutely able to make significant changes if you like.

Um, the supplemental budget requests um have been all reviewed.

The uh there are no new decision packages included here, although there are some slight adjustments that are represented that we've talked about also in April.

And then we don't update the six-year CIP.

So we tend to stay with what the CIP was, and we do that every two years.

So what you can see here is that right now in the recommended supplemental budget, we have a tax levy of 124,901,338.

That is um a year over year increase, not a property tax rate of 5.59%, which is less than what you saw on the trend.

The trend that we um were looking at last year was 7.4%.

Um, so we've had some positive changes within our budget assumptions, um, but not all of them were positive.

Um, the general fund budget, which is very reliant on the tax levy and has many 24 or seven services in it, like police and fire.

Oftentimes public works can get wrapped up into 24-hour services too, depending on the weather.

Um, that is sitting at 141,69,000 and change.

And that is actually a pretty small increase, about two 2.94%.

Part of that is because the actual changes to employee services were less than what we had anticipated based on movement within we budget for a position at the rate that it's we anticipate.

And so if somebody, for example, retires, leaves, if we're hire a new person, sometimes that can have positive implications.

And we also have been having um lower costs related to some of our health insurance.

So we've had some positive things, but that also can swing the other way in the future.

So just always good to know that we would typically be in a trend of about four, four or five percent for the general fund.

Um, but some positive things um have developed.

Um, the action plan, we have reviewed that on February 23rd.

Uh, the next update is on an August study session.

So if you're looking for some of those performance measures related to the action plan for your strategic priorities, and again, the supplemental budget hearing and adoption scheduled for December 7th.

Um, so the tax levy year over year increase, so the dollar amount needed if all of these things are funded, is about a 5.59% increase as compared to what was collected in 2026, the current year.

Um, they don't reflect those discussion items that I mentioned.

So if you were going to absorb, continue to absorb the credit card fee, we would need to adjust the levy slightly for the levy funded accounts.

And then, or people aren't going to be able to potentially complete all of the projects that they intend in their budget.

Local government aid impact to street reconstruction is also not included in that 5.59%.

Again, the prior trend was showing that we would be about 7.4% up in the levy, but we've had some positive developments in the basically how you are funding doing your financials.

You might recall also that this is the second year where we had adjusted the allocations.

So that's a positive to the levy.

We had we did leave parking storm and sewer at 2%.

You discussed that when you were talking about your payment in lieu, and that maybe they shouldn't be the same for all, but we also had indicated we wouldn't be implementing those until 2028.

So we've had positive development on some of our medical side.

And it does include what you discussed in April, which is a max of 150,000 for golf operations.

There's also 200,000 that goes for capital at golf.

So it's got the max there.

This their assistant city attorney too is an adjustment that is a correction from a prior year when we made some adjustments, but actually didn't include the position in the budget.

Building automation specialist and facilities supervisor reclass and an addition of a position, those are funded through energy savings, so offset by savings and utility costs.

And then you will recall that we also talked about the decision package from police that adjusted from having two officers to having one officer and a community outreach specialist.

So that's all within that dollar amount.

Something that you could use as a dashboard, but you don't have to is the fund reliance on the tax levy.

So what this are not in proportion to one another.

So for example, um the airport fund is about $6 million all in for the operational fund and the city funds about $650,000 of utilities and customs.

But you'll recall the general fund is much larger, about 125 million dollars of tax levy in a in the in the general fund.

So you these aren't in proportion to one another, they're just in proportion to the total fund that you're looking at here.

So DMC projects do not have tax levy towards them.

Library is very reliant on property tax in large part because libraries are generally free.

So to fund the operation, it's generally going to be funded through general property tax.

And you can see debt service on there, about 34% of that is related to tax levy.

So the rest of that is funded by some other revenue source, if that's helpful.

How do you roll up to 5.59% increase year over year?

Um you can see the employee services is much less than it typically would be, in part because we had positive development there.

Again, that could change.

If if more people start taking health insurance, then we will have higher costs.

I would say it went up by about 0.24% because we had no longer have some of that holistic budget stability fund.

You'll recall that the COVID dollars to be able to mitigate the costs of sort of coming out of a pause in operations and a 0% levy.

Um then we have the equipment revolving stabilization.

So we're trying to continue to slowly increase the amount we're putting into that fund because everything is costing more.

Um we do also charge departments for surplus vehicles that were never purchased through the budget process.

So that to encourage folks to really think about whether or not they need that vehicle.

Uh capital improvement plan, small, very small increase there, and then um other, which I think I had written down in the PowerPoint, but we'll have to phone a friend if anyone asks me what that is.

Um, and then the decision packages that you see on future pages are about 1.15% of that year over year increase in levy amount.

Something positive, we do have new construction that's anticipated in the estimated market value.

So any increase, or even if you just had the same levy is first absorbed by the new construction.

Um, and then valuation adjustment, whether that's commercial, um, residential, apartment, multifamily, um, is going to absorb the rest of the increase based on the value of each property.

Um, so it is just always important every year that the percent increase that we talk about when we talk about the levy going up is not the rate that you will see on your bill.

It will primarily depend on um what how much your valuation changed relative to everyone else in your class of property, and then whether or not you're also having some of your homestead um uh value fall off because your value of your property is increasing.

Something else that's positive is that we do have two TIFF districts that we would anticipate being decertified at the end of the year.

Um so you can see about 470,000.

That also will immediately absorb about 470,000 of any increase to the levy because it's not just new construction, it's sort of like having new construction.

Um, but the county doesn't know that yet.

So the prior slide does not include that.

Um so about a little over a quarter of any increase is going to be absorbed by new construction or the decertification of those two TIFF districts.

Administrators, can you clarify?

So the the 46 uh that's uh anticipated for tax levy because of the TIFF districts being completed, is that included in the top line?

It's not included, it's just gonna absorb the initial tax.

So I see.

Yep.

So it's going to help offset any impact to existing property owners.

Got it.

Well, I guess they are existing property owners, it's just that they're going, their TIFF is going into the TIFF fund.

It will mute the impact.

And then this slide will be this as the last year that you'll ever see this slide.

Um we did decide to put it in just because we thought we should give it a goodbye.

Um, so over time over the last um six years almost, you have been able to uh offset the cost of the levy with those funds slowly going down over time.

Um, but that that time is now over.

So you won't see this slide again.

Um but just kind of getting to some specifics here about the levy and whether or not the 5.59% is where you would want to stay, or whether you have concerns about that is whether there's support for implementing a convenience fee on the credit card usage or increasing the tax levy by about 175,000.

We do have credit card fees that are not in the general fund or that are not levy funded, but really we're concerned about the levy at this point as we approach September.

Uh and then also a local government aid, whether or not you would want to fund a little over a million dollars of bituminous with a levy adjustment, or perhaps you would want to get there over time or not.

We did break down the credit card fees slightly differently this time.

So perhaps one of the more important places to look is the tax levy line, which is three lines from the bottom.

A middle middle shade of blue.

Um, you can see that the budget that we have in 2027 is about 81,000, but their actual costs of the tax levy is about 243,000.

So what that means, and a lot of this happens, you can see in uh building and inspection services and in municipal recreation, is that the levy is absorbing those costs.

But do they have to spend less out of their planned budget because they're paying more credit card fees than what they have allocated in that line item?

I see a handout.

Uh Mayor Norton.

So I know this is happening all across the country.

There, you you go to stores now and there's off often a credit card fee.

My question is we also don't take cash at many places now.

So we're we're in this weird place where we're we've sort of pushed people into doing credit for a lot of things, and now we're going to charge them more.

Are we wanting people to write checks instead?

Um, how are people?

Because if we don't cover this, the constituent is going to, right?

We're we're asking, we're we may not call it a tax, but we're saying you're gonna pay a fee to cover the cost of your credit card when we've, you know, we're giving them less and less options.

Young people don't even have check checks, literally don't they don't even know how to write one.

So perhaps Ms.

Woodward could respond.

But for example, the building inspection services, which is a pretty large fee absorption, they do allow people and actually encourage people to set up an account, which you just need your account number for.

You don't need a credit, you don't need a check if I recall.

And we do also accept checks.

So people can drop off and pay their fees via check.

Most of them pay online through a sellout and use the credit card processing, but they can pay.

And we also work with some of the larger um to set up a trust accounts for when they need to pay fees.

Yeah.

And the alternative is that everyone that lives here is helping to pay for someone to use their credit card.

Or people have the convenience, oftentimes it's called a convenience fee of their absorbing the convenience fee for their credit card.

Councilmember Wall.

And unless I didn't hear correctly, uh most of us have the ability to bill pay uh directly out of our accounts uh without that that's no extra charge.

Yes, that's correct.

And I I would have to ask Mr.

Whitman if what they do at parks.

Very similar.

Oh, I lost my microphone.

Thank you, Louisi.

Never had one.

Okay.

Um they all of our uh participants have the option to uh pay in cash check.

Or or credit card.

Uh most of our registration or participants in activities prefer the online and they they're willing to pay the credit card fee.

Uh we do have for picnic shelter reservations, quite a few groups show up in person just because they quite often have to um do business with both parks and recreation and the clerk's office, and uh we we get a lot of checks uh for the for those services.

Mr.

Chair.

Uh uh well, we have council member miller first.

It's fine.

It it might be the question that Mayor Norton is asking to.

I don't know, we've gone through some of this, but line by line, which of these would have an alternative to a credit card payment?

So parking, building inspection services, yes, municipal recreation, yes.

But then the other ones.

I believe the city clerk, yes.

And then but the city clerk is sitting behind me.

Um the challenge we have with parking, and I believe parking ticket has the option to pay with a check or cash.

That's also city clerk, usually.

And then um the main ones that are more challenging would be parking, but we also have an arrangement with a service, so that's and it and it's not funded with levy funding.

The primary things that we've moved to only using credit cards are things like the parking ramps.

Okay.

And we also subsidize quite a bit of parking by three hours.

Just having certain hours be free, yes.

Mayor Norton.

I was just looking for clarity when um we were talking about people paying online.

When you're paying online, you're still using your credit card or going through your bank.

Are we not offering fees for those?

It's only literally a transaction and a machine that you're talking about.

It's if you use your credit card, whether that's online or in person.

If you use a debit card, that's a different scenario.

If you uh put in and then ACH online, then that also does not have a fee.

For example, when Rochester Public Utilities, but every credit card is slightly different.

So this is I think there's like 30 agreements that Mr.

Anderson is working through, um, which is why we don't have a detailed recommendation for you today.

However, if we don't increase the levy funded accounts for those charges, then the the major impacts are going to be building inspection services not having enough really having the budget that you've approved, municipal recreation not really having the budget that you've approved, and the city clerk parking ticket collections, and again, we always like to have miscellaneous so that I have to phone a friend.

Um just various charges throughout the city where somebody might collect a fee.

Councilmember Palmer.

So our RPU has a fee and they need to set that themselves.

But there's a cost to us to have me show up at building and safety with cash or check, because then somebody has to count it, somebody has to drive it down to the bank and deposit it at the bank and then come back.

And so is it w do we know the cost of doing that?

Or is or do we just assume everybody's gonna have that and just an added cost if more people write checks?

Mr.

Anderson.

Yes, thank you, council president.

Uh we're aware that there's a fee for dealing with cash and there's you know, a fee of telecheck and for processing checks, so there's basically a fee for everything.

Um thing that we are taking a look at, or what you know, my initial analysis has found out that even if we are able to pass along, so say there is about four major vendors that I'm currently taking a look at for the processing.

Um I was able to speak to one and they said, well, we we only pass along a three percent.

That's it.

We don't go any higher than three percent, even though the state law says five percent.

But I think our fees that we are absorbing are closer to like five, five and a quarter percent.

So even if we do pass along a three percent fee for again, my initial analysis, I think we're still absorbing some of the fees.

I I guess my point is there's at least five departments that probably somebody has to add up the checks and the cash and take it to Wells Fargo and deposit it and come back.

And we don't have cheap employees, and so there's a cost to do that.

Uh, there's for a lot of it, I think there's a service that does that for us, though, too.

Like that they do that for free.

A security service.

No, not at all.

And I haven't had time to look into that one yet, but um, I'm aware of what you're talking about, especially when it comes to parking and dealing with the the change in the money.

Yes.

We're still looking at that.

I mean I'm I'm all for charging the fee.

I mean, everybody's used to that at restaurants and businesses, so I'm fine with that.

Councilmember Miller.

Yeah, I'll just provide feedback.

I I think this makes sense.

I'm in favor of it, especially for these areas that have alternatives to the people could avoid the fee if they choose.

Councilmember Fredericks.

Actually, I was pointing the key.

Oh council member Keene.

Yeah.

Yeah.

Again, I I want to just uh I think the goal here isn't so much to have them pay a different way, or it it isn't to whether they absorb the thing or not.

It's that the fees go away and that we don't have them anymore.

Um I think right now the the way I understand what RPU, they didn't try to collect the extra three percent or three dollars to offset.

They said do what you want to do, whether you whether you want to pay with the credit card, that's fine.

We're not trying to change your behavior, but we're just trying to make sure we cover our costs.

And I think we're doing the same thing here.

That's what that's what our intent is is that we don't pass along six hundred and well, I guess I have to take parking out about three hundred thousand, a little over three hundred thousand dollars of what is the convenience of using your credit card to every other taxpayer.

Yeah, the one that's that I'm still hard getting struggling to get my head around.

I know it's a enterprise, but parking where that that transaction that's happening real time, I don't know what kind of I thought that is really it's almost like the MCC saying we only want credit cards because we don't have a method of handling the other ways.

Correct.

That's why we're not recommending it for non-tax levy funded.

And we're also in a five-year contract with IPS.

So and the way that they apply the fee is very different, and whether they would be able to do that with their current system is a question mark.

So I'm trying to understand the difference then in the 2027 budget.

Are we talking about 81,000 or that we keep on talking about the two or three hundred thousand?

What we're saying is if if you don't charge a credit card fee, we're 175,000 short of levy in order to be able to fund all of the things that are levy fund, like the actual budget that you would be approving for building inspection services, municipal recreation, city clerk, parking ticket collections, which doesn't happen in parking, and miscellaneous whatever miscellaneous, all the other little things, which is maybe not as big of an issue because it's probably across multiple departments, then they will not act they then they're gonna be overspending their budget by probably more than 115,000 because people are paying by credit card more and more and more.

So they're either over there, but we don't let them overspend their budget, so they have to not spend on other things that they were anticipating, sort of like shorting their budget by the dollar amounts in the third column.

Okay.

The thing that I thought council member Palmer was trying to get towards is there is this other side of this, and this is why places like MCC have said no cash, no checks, credit only.

Um is that an option that we've looked at for some of these things and then just set our prices accordingly?

It's something that you could look at.

Yeah, I'm not suggesting it, but I'm I'm trying to except my view is we already have those methods in place.

We're just using them at 20% instead of 50% of the transactions.

And I think that's where we get to.

I think most things would go towards a bank transfer, uh, which is what RPU has moved much more to these are also not things that you pay monthly typically.

Right.

That's what bothers me about these, that they're not they're they're not things that you set up on a reoccurring basis like uh like a monthly charge.

A lot of them are one time one-time fees for like the clerk's office's parking tickets where those are harder on me.

I would say it's not like we've hired a cadre of people to other than having a security service that takes the actual bag of money.

We're not hiring people to like handle that it's a piece of some other job they're doing that means they can't do something else.

I'm not saying that's good or bad.

That's just it's somewhat unfortunate.

This is already in place and being paid for unless we stop taking cash.

So I I do think that is an offset.

Um yeah, I I'm still trying to get comfortable with this because I do find it to be um like that, and I think we have to be telling them that we're charging them this fee.

And we had trouble with that with getting people to hear that before the fee started showing up.

So I think I think if we do this, we should expect some blowback of people saying, like, what are you charging me for?

I don't know what's happening here.

So I'm uh uh again, I understand the logic behind doing it.

Um, in the bigger I I think there should be some sort of communication associated with it.

Um, but uh yeah, I I do support the idea of not absorbing the credit card, the the credit fees across the entire uh levy payers and focus the the fees on where they're coming from.

Councilmember Fredericks.

If I'm hearing that we're eating five and a quarter percent and we're gonna ask for three, that doesn't make a lot of sense to me.

I mean ask for four because they have the option to ACH for nothing, correct?

There's no fee for that.

There's a limit with one of the providers that we have, and again, I haven't had access because it's under uh person's name.

So they said they only go up to three, so I can't tell them to go to four because they generally speaking, though, you could have the opportunity to ACH or use a checker and you don't have a fee, correct?

Uh, with US bank, not our primary for Wells Fargo.

I feel like we're dancing right now.

Um I don't have all the information to present it to you.

So well, the point I'm making is it just seems like typical government fashion.

Oh, we're losing 5.2%, but we're gonna charge three.

And uh we're gonna make up for it in volume, but it just doesn't make sense to me.

So I think the concern is if you have a credit card provider, you either have to not accept that type of credit card if they are unwilling to pass through more than three percent, or you have to have multiple different fees, which seems very confusing.

Yes, it does.

That's why I'm saying a four percent makes more sense because you see that very often.

That then you'd have to not allow people to use the type of credit card that only allows you to recover three.

Council member Palmer.

I I'm not particularly sure what what you're actually saying, but I don't want us, this is not a profit center.

This is just to cover the cost to make it fair for all people who actually pay.

So that to me is is is uh is what you're trying to do.

It's not to make a little extra money.

Okay.

That's that's my point is you know, and building and safety.

I know there's some guys who will use their some people will use their credit card only because they get miles, and uh they'll they'll do that, or if you get a building permit for 100,000, I don't particularly want them showing up with cash.

And so, you know, I mean, um, you know, they can write a check.

I believe there's a certain amount where we don't allow them to provide cash.

And actually, maybe even most of those folks set up a customer account.

Correct.

Okay.

Um this I am comfortable with the convenience fee.

Uh it sounds like a reasonable decision.

Any more on the convenience fee issue.

We do have the other issue that's the staff is asking us about, and which I think is probably has a little more impact.

So yes.

Council member Keene.

Just on the convenience fee, I want to just to clarify RPU didn't charge a percent, they charged a flat fee, which is a little, it's much simpler, but it does have the bad effect for the lower bills paying a higher percent.

Um, so that's something that we should be aware of.

The percents are are probably more uh train uh trailer are things better, but they are comp they are more complicated to explain.

Yes, and some of these fees are like $25.

So if you have three percent on a $25 bill, it's very small.

Yeah.

So if you have three percent, yeah, yeah.

Thank you.

A chart that finance made, that's beautiful.

Um local government aid uh since 2019.

So just moving along.

I told you it's gonna keep you awake this time.

I just want you to strain or something.

Yes, you can look at it online, it'll be there forever.

Um so since 2019, this is what the local government aid has looked like.

Um wild vacillations and how it has changed, but that is direct relationship to the formula.

Um I I guess one positive is we don't do well in the formula because we have a lot of development in Rochester, and not every city has that.

So not every city has that new construction.

Not every city has had new construction for every year since 2019 or even since 2000.

Um, so it is set up as aid.

Um, we did have the hold harmless that happened in 2024.

Um, and now we are going back to 2023 because the hold harmless is over.

And you so you can kind of see that in that chart.

Um, so what we did in 2024 when we had the unexpected dollars come back through the legislative process was isolate the m vast majority of that to increase the amount of bituminous pavement that we could put funding towards each year because it's a capital project.

If you had put this towards, say, two new police, well, you'd get more than two police officers, but you two police officers, two cars, maybe an assistant.

Like now you have this new way of doing business and it's more challenging when it's on an operational cost.

Is this important to our operation?

Yes.

Is it we we did not have the same amount of funding going there before 2024?

Um, so that was about the total LGA reduction is a little over 1.2 million dollars or 24% of the LGA.

Um we had about one million, a little over 1 million allocated towards the CIP project for annual by two minutes street reconstruction.

Um the remaining 166,000 is absorbed in that 5.59% levy adjustment um in the operational cost.

And then um the 2007 CIPR also has 910,000 allocated.

So that's how much was going in before we made that adjustment for LGA and tried to isolate that towards a project.

So we more than doubled how much is available in order to be able to provide the mill and overlay.

Um street reconstruction line.

Can you hold a minute, Ms.

Helms?

Uh council member Palmer.

So it tells explain to me how the sales tax extension, um, which is new money is is is allocated to roads.

So the new sales taxes for reconstruction.

This is sort of the annual maintenance of the roadways.

And the way that that was worded, I might have to phone a friend because I don't have it in front of me.

But it talked about reconstruction of roads.

So you can't build a new road with it.

And I would I think the intent is that that's for major reconstruction projects, for example, center street.

Yeah, it it it is actually similar funding.

I mean, it again, you'll see in subsequent slides that we're still significantly behind our annual you know, need in this space.

Um, but both are for you know, street reconstruction, the sales tax, obviously, you're prioritizing projects.

Um, some are larger reconstructions on state aid roads.

There's a lot of emphasis on state aid roads for that.

This is really emphasizing more residential road reconstruction, so areas that are in the you know, 80% of our roadway network that don't have a funding source for reconstruction.

So this basically brings your resident your residential road reconstruction budget to zero.

Um you don't have another funding source for that.

Your state aid and your sales tax are predominantly focused on your larger streets.

Not that you can't use your sales tax for collector streets, more residential streets, but it was designed to be more regional in nature when that was approved.

Well, the the LGA, my understanding if I remember correctly, is that a couple years ago we said don't put it in the budget because it's undependable.

So we're gonna throw it at the roads.

That doesn't mean we're gonna throw it at the roads all the time, but we have we have this reconstruction for sales tax extension.

That's where that should be going to, and it shouldn't matter if it's if it's a state A road because we're getting state aid.

And it should be for the residential jobs.

And we're not building new roads with it.

I mean, most of the developers build 90% of our roads.

So I I don't know why we would even consider adding more to the tax levy.

Yeah, your honor.

This is for the existing residential roads that are due for reconstruction that at some point, you know, the developers gifted us these 30, 40, 50 years ago, and there is a need at some point to reconstruct those roads.

But um, again, sales tax can be relevant here.

It is helpful.

That's a new funding source since we allocated this originally.

Uh and as City City Administrator Zelms indicated very correctly, like this was designed to not be impactful to operations when or if it went away and it it has gone away.

So I'm just following just follow up.

I mean, 36th Avenue out in Northwest Rochester at Kirchclow Manor hasn't been rebuilt and it's 65 years old.

So uh, you know, at some point we've been paying PAPE taxes for that.

We mill an overlay.

Typically, what we're really replacing roads with is when the sewer or the water goes bad.

And so then we're going in these neighborhoods and they pay a small percent.

But but so I'm um I don't understand where the confusion is or why we'd want to add more property tax.

Yeah, your honor, I maybe defer to the public works team on specific projects, but yes, utilities often drive reconstruction, but at some point streets need to be reconstructed, multiple factors in play uh for that, but uh at some point you do have to um you know ensure reconstruction, whatever the time frame is.

So just to clarify uh um uh council member Palmer's initial question.

So are you saying we cannot use the uh sales tax funds that we have for streets for our mill and overlay in our residential streets?

Or do we have to do that?

I'm not saying that yeah.

I mean, again, the the team is prioritizing those funds, and you know, they've allocated and recommended projects, and again, you're you still have a finite pool of resources there.

Um, but could you?

Yes.

Uh mill and overlay is generally well supported in the budget.

Uh mill and overlay isn't a reconstruction, so you can't mill and overlay forever at some point you got to reconstruct.

But we have significant state aid dollars and other dollars in the CIP that are allocated for a fairly well developed mill and overlay problem.

This is again street reconstruction.

At some point you're gonna need to do that, and you'll need it more and more in the future.

Thank you.

Thank you.

Uh Council um Mayor Norton.

And then we have Councilmember Wall and Councilmember Keane.

So I'm glad we're having this discussion, although I didn't think we'd be having it quite in the detail we are today.

Um our road um health has been a significant concern of mine, and I find myself uh agreeing with councilmember Palmer, which he'll probably run from the room screaming because of this.

But I actually think um we have we have a huge citywide problem with local roads.

They are in horrible repair.

Mill and overlay, in my opinion, has not been working well at all.

I watched it on my own street in about one year.

It was a complete mess again.

And the gal that was here from urban whatever told us that we should consider not doing mill and overlay, that we should recon spend the money on reconstructing the street, and then you've got another X amount of years.

That was not she she made the comment that that mill we might want to look at mill and overlay as not a uh good investment.

Yeah, you do need to do mill and overlay.

It's a critical part of extending the life of a road to 50 to 60 years.

So you actually there is a whole formula for how you should do mill and overlay.

I understand those kinds of things in order to push out the reconstruction.

The issue is at some point you do have to reconstruct.

Because we have been doing mill and overlay so long, and we're not doing the reconstruction on roads, and instead we're waiting until we're at a point where there are roads all over this community that are crumbling that need to be reconstructed.

And that sales tax money that we collected, what in my opinion when I went up and talked to the legislature was not about any major roads, it was about roads.

And I think I thought, and I think the community thought that meant their roads too that are crumbling and need work.

And so I really hope we can get to the bottom of this and not just continue to rely on mill and overlay that just push the problem down further and further and further without really repairing.

I don't want this to sound combative, but you have to do mill and overlay in order to maintain your streets.

It is a critical part of the street maintenance program, and you have to fund reconstruction.

I understand that.

But when we spend money on a mill and overlay again and again, and then you're in tearing up streets because of, as was mentioned, sewer and all the other things that are under happening underground.

We have spent a ton of money on roads that could have been used on a reconstruction project to fix it all and be done with it for 50 years.

And that is not happening, and our roads are crumbling, and people are tired of it.

I get calls all the time about the roads on people's chests.

I don't want there to be such inaccuracy on the record.

You have to mill and overlay in order to maintain your roads.

I I think we are not here to discuss the merits of mill and overlay.

We are here to discuss whether or not we want to uh to add to our levy uh 1.2 million for the uh reconstruction of roads, however we do them.

And so the question, and I think I'm hearing from the mayor, I heard from from uh from councilmember Palmer, and I would agree myself is I would like us to look at that half cent sales tax road reconstruction fund and whether that is a place for us to go for this rather than tax levy.

So with that, I'm gonna go to Councilmember Wall and then Councilmember Keene and I don't and Councilmember Miller.

How much road reconstruction would one uh point two million get us?

And to clarify, we're looking at bridging the shortfall of 1,076,000.

I'm not saying you have to do that.

Um, but I would need to have I don't think I don't think public works this year.

Yep, Aaron's they are here.

Sorry.

So that's a great question.

I don't know off the top of my head how many miles that that will get us.

Um, but generally speaking, you know, again, this would cover what it already.

Can you get closer to your microphone there?

There we go.

Um so to answer your first question, I don't know exactly how many miles this this will get us.

I can talk to Dylan Dombrowski and get back to you on that.

Um the what this will cover is um uh what has been covered by the LGA.

It's largely used in those projects in which um there are assessments being applied, and then the utilities are covering their portion of it, and the remainder of that is what this fund is used for.

There are some limitations as um uh Aaron had mentioned with the the local sales tax and trying to find the regional nature of that, um, recognizing it's not just strictly limited to regional, but that does come into play as we evaluate that.

Um so it would cover the existing portion of that.

Keep in mind that based on the 2019 report, we had a 16 to 20 million dollar annual shortfall.

Um this uh further um makes that that even worse, adding another million on top of that.

Um those numbers do consider um the the local sales tax, so it helps a little bit, but it doesn't get us nearly as far as we need to to cover that gap.

Could I clarify some I just want to I think I confused this the 910,000 is what has always been in the budget for the mill and overlay, the one million dollars was allocated towards reconstruction.

So I sort of bungled that slide and I think I've created a problem.

I just want to clarify it.

Yeah, thank you.

And if I heard Mr.

Parish correctly, we have zero budgeted dollars for this item beyond this uh million seventy-six.

Yes.

Councilmember Keene.

Yeah, I I'm struggling with this one.

Maintaining our streets is critical responsibility for infrastructure for for any municipality.

Um, but I agree that when we did the when we had the uh hold harmless and we move this into streets, it was so that it wasn't critically into the budget.

Now we're using the the activity of losing that and and then putting it critically into the budget forever.

I'd rather do this as more of a decision packet in 2027 when we're doing a full thing and lay it out against our other um responsibilities and make sure it's it's that I don't like this.

Feels like we're doing it as a one-off.

Yes, I I could appreciate that.

And we wanted to make sure that you were aware of it.

It is a policy item that we need a decision, like we don't want to make the decision for you, I guess.

And so it also could be that you want to consider later on, whether during this budget process or in the future, that you would slowly get up to the million dollars or some other amount.

Um so it is there, I mean, you don't have to replace the whole million dollars considering it wasn't there before 2024.

You could consider whether I mean you don't have to, but you could consider whether you want to get there in four years or whether you want to get, you know, wait till 2028 and then and move from there.

Yeah.

So that's that's my input that I would, but as far as this partial and things like that, I guess the other thing I'd want to throw into this most of the reconstruction we do is through uh the enterprise things, the the assets under the underground with be it storm sewer or water delivery or sewer.

Um, but right now we have an algorithm and a process that we share costs across those groups, and it's sort of bothersome that public works takes the lion's share of that because they have the you know, finishing the road on top, even though they're not generally the ones saying these are the roads that need to be reconstructed.

And I think there's some fairness there that we probably need to work out to be if if you're the one saying um this road needs to be reconstructed because we've had four water breaks in the last three years, you shouldn't just have the responsibility of paying for your water line.

You should take more of the cost of driving this project.

And I think there's a right now there's a policy that exists across, and it's across the enterprise funds, like uh sewer and stormwater, and they they pay a smaller percent.

And I think this is one of the reasons why we do have roads that we look at and say, hey, we want to get to those, but we don't get to them because we only have enough budget work to do the work with the utilities that are driving.

And those need to be done too.

I'm not saying they don't need to be done.

It's just we don't get to the other streets that we want to get to.

Um, and I think those are bigger sort of policy things that we need to work out.

And I I don't feel right approving this or giving the go-ahead that we need to move uh new levy money into this in 20 for the 2027 supplemental budget because it's a supplemental budget and it doesn't have the rigor of all the other compares.

Councilmember Miller.

Yeah, I I largely agree with that.

And I would also point to the fact that we've had a conversation about our our trail networks and not having a sustainable funding source, and I would like to look at this a bit more comprehensively of understanding how we're developing sustainable transportation funding sources for maintenance.

I do think the urban three um report is is helpful here because we have to understand our long-term lia liabilities.

We talk about annexation when we talk about new development, how are we generating sufficient tax base to pay for the ongoing maintenance over time?

And I would wonder, even if our action plan gives us an opportunity to tie some sort of measure of increased uh tax capacity, new development, something to unlock funding and phase this in over time, but I I wouldn't be in favor of um just shifting this to the levy right now.

Any more on uh this issue.

Seeing none, uh Mr.

Luxin, go ahead.

I just have one quick clarification.

I I pulled up the quick budget.

We still do have 910,000 in reconstruction that would be available.

This is the million that was going to be covered by LGA.

So there's still a small amount, approximately half that is already built in there that we could still advance some projects, but not as much as what we would like or had been planned.

Thank you.

Uh Councilmember Palmer, go ahead.

So if you live in a newer neighborhood and and they didn't do the inspections correctly, you have a road that is um standing in water, and people don't like that.

And so somehow we've got to go backwards and fix that from 10 to 15 years ago.

Superior Drive is an example of that.

They had to redig Superior Drive up, they went down about four feet to get to good soil.

And again, I'll go back to 36th Avenue.

Literally was built the year I was born, and they haven't done anything but millinal relay and chip seal it.

And so there's there's there's some problem with some of our roads, and some of the worst roads we have are the roads that we inherited when we did the sewer project down in Southeast Rochester, and they were they were annexed in and they have no sidewalk, they are very small roads.

So not all roads are the same, and not all the problem is the same.

And so I agree with Mr.

Keene.

Let's let's look at a policy position next year and let's come up with a policy that works.

And Mr.

Miller's right, our infrastructure on on um trails, it's 90 miles of trails, and and some of them need to be rebuilt.

So if it was built the year you were born, it must have been cobblestone, right?

It was dirt.

Well, the helpful discussion.

So I'm hearing comfort in us continuing with the convenience fee for credit cards, but not but we will wait until 2028 and do work in between to talk about um pavement overlay, both funding for streets for trails, and also whether that's all how much is allocated to the utilities who you have to build the road back on top of.

All right.

Just a few more.

I think I still might be able to gain 10 minutes.

Um, but it's up to you.

Um, so we don't have any changes to outside agencies here.

You'll recall there was there were some adjustments between 26 and 2027.

Um, and we didn't do a process this year to um that is intended just to be supportive funding for these agencies.

It's not intended for them to fully rely on it.

Um the 2027 decision packages, we kind of we had talked through that.

Also, based on the conversation in April, we didn't advance anything um regarding public music.

Um, these are the decision packages that are within um both the levy and non-levy funded um funds.

Um, the specific packages, and you can also see that the um community service police officer and one community outreach specialist that that the funding amount and the um information about that changed there.

I did just want to point out that there was a question earlier today about um if you didn't fund any of the tax levy supported decision packages, it would reduce that year over year levy increase by 1.94%.

I don't know whether I was getting my math from earlier today, but I got this from finance and it's right.

Um, and then I also um did want to point out that um within this, if you look at the third line, there is um funding there of $700,000 that's to complete your um enterprise resource planning software project, which is currently underway.

So it would be concerned if we cut that.

Um if just so if you didn't remove that, if there's any desire to remove any of it, um, then you would be reducing the levy adjustment by 1.35% if you took if someone, if there was four of you that wanted to reduce all of these decision packages.

Uh I do, and I don't know if I should wait until Chief Franklin comes up at uh the fourth item here, but I did have some questions on uh both the the community outreach officer and the officer position and uh kind of my I'd like to have some clarity on currently I believe it's a part-time community outreach officer.

And so are we adding a full-time to that?

And my question is you know, is that enough or is there more?

And then I did have some questions on the issue of overtime that we heard earlier and what the department is doing to uh to deal with that issue.

There you go.

Council President is certainly willing to answer that now, or you can wait for now.

It's a budget issue.

Okay.

So in reference to uh the community service police officer, community services is just the division it's assigned to.

So it is a full-fledged police officer.

In our original budget request, we had two police officers requested to be assigned within our community services division to be assigned to our community action team, which one of their primary functions is um handling problem properties.

Um but mostly one of their primary functions is dealing with people experiencing homelessness.

Um as a result of hiring um our embedded kind of homeless navigator, Terry DOS within the organization.

I think we've more than proved concept, proof of concept of the value of that position alongside of police officers working hand in hand together.

So we're gonna cover some of that in the presentation.

Uh, but what you see in front of you is an adjustment downward from two officers to we still feel we need the one officer to sustain the level of work that we have in front of us, but we are also asking for budgetary funding for that embedded homeless navigator in our organization.

Currently, that position uh is is funded through um public safety funds that will expire at the end of the year.

So, short of a budget uh allocation, that position actually goes away in 2027.

So, to clarify, so uh are we getting additional uh resource time resource for that role that's been filled so valuably.

It's a great question.

Uh so what this is reflective of it it would be a net neutral for the community outreach specialist because we already have that under the other funding source.

Uh so it's either fund that or that goes away.

So that'll be a net net neutral, but it would be a plus one FTE police officer assigned within the community services division to the CAT team.

Got it.

Uh and it it and the other issue that I brought up, the overtime issue, which came up earlier to I know there's some work happening in the department on that front.

If there's anything you can share.

Yeah, certainly.

Um we're we're pilot testing internally, uh, we're taking a very aggressive approach to trying to uh manage our overtime, understanding that overtime, just like other entities, public works, fire department, us, uh, when we're short staffed, you know, uh we have certain minimum staffing levels on the street.

Um we have seven officers currently in our academy.

Uh so technically, and we still have one opening.

So technically we're eight officers short.

We don't fully realize those officers, even though we've hired them until they're fully trained.

Um it takes about six to eight months to get them fully trained and on the street, fully functioning as police officers.

So there's always kind of that gap that has to be maintained in reference to funding or excuse me, staffing the street, rather.

So, but with that, uh, we're we're testing um really a pretty innovative training model where we're trying to utilize on duty time to train our officers and do our in-service training uh with legal updates, use of force, things like that, um, in reference to buy down some of that overtime, whereas last year we paid officers to come in on their off time.

We're trying to leverage downtime on duty time to um kind of spread out the training.

So it's smaller increments of training rather than kind of bulk training on on days.

So that's one of the ways that we're managing the overtime.

Uh, and again, we're just being a little bit more judicious in that in saying uh when do we really need the staffing and how can we staff it?

We still need those minimums and we still have to maintain those minimums.

Uh, but who could we possibly pull?

Uh maybe maybe there's a detective that we could pull out of the bureau that maybe has a little bit of a lighter day and put them on the street to help plug the gap.

Councilmember Miller.

Yeah, I I appreciate the information and yet I feel like I'm still struggling to get my head around exactly sort of the the long-term strategic operational analysis of what fully staffed is.

I mean, one of the things that I continue to hear in the community is why is there not more enforcement for traffic?

Um, and I know that's an area that's we've been talked about here and there, but I I've asked about this before for just operational analysis of all public safety.

I feel like we've gotten a clearer plan that we've talked about with fire, like a long-term plan to open a you know, an additional fire station, move an engine.

That feels more tangible to me than this discussion.

I just wonder if we can bring this back at another time to better understand some of these challenges.

I I'm definitely interested in how we're managing overtime, how we're budgeting for overtime, where that actual to budget is coming out.

But I'll just say I'm struggling with uh sort of management level discussion versus like where we are at a policy level.

Happy to come back at a later time.

Um if I could briefly address your traffic enforcement concern, the way it works operationally right now is we do not currently have a dedicated traffic unit or officers um that are dedicated to that short of the one grant funded officer that we have, but uh they're assigned primarily for DWI interdiction, which is a state DPS Department of Public Safety grant.

Uh that's their primary role.

Certainly there's some traffic enforcement mixed in there as it's uh related to DWIs.

Uh so we do have that one position.

Uh as we continue to grow um as an organization and trying to meet the demands and needs of the city, I agree we do need to look at a dedicated traffic unit as that continues to be uh concerns, and I hear concerns from you and other citizens as well.

But uh so traffic enforcement is done uh in between calls for service when time permits councilmember Palmer.

Well, thank you.

Um I mean, obviously safety of of the public and the officers are most important in my understanding is if you're short of staff, you're saving money on that end, so then your overtime budget goes up, and in it's kind of a balancing act of what you're trying to do.

And so it's not like um we're just fully staffed and overtime is overtime.

Um I getting that correct.

Yeah, and and I apologize, I cannot remember the gentleman's gentleman's name that presented, but he he kind of touched on that a little bit that at the end of the year it balanced out fairly close.

Yes, we were over an overtime, but we had some employee services savings that helped balance and offset some of that out.

You are correct.

Okay, and then I know I've had a discussion before, but to me, um, we use the drone um um uh program a lot.

And in I would like to see some savings on that to say, you know, um, I did the drone, so I didn't need to go into overtime or or some kind of a um a policy in there that that we know that not just for for public safety, but also for for um saving some money.

The last question I had, or that was a statement, I guess, but a question for you is last time you were here.

I think for the homeless, we talked about I think about two million dollars out of a budget handling the homeless um um population.

Is that about the right number?

Uh I'll I'll do some math real quick.

We have a s we have a couple slides on that why don't we hold that one for presentation?

Yeah, okay.

Uh, because it's not just your department, it's also Park and Rec who sends their people out there to clean up um um camps, which is very expensive.

That that is so we'll hold that for until our okay other um if you wish, I believe Mr.

Parrish has the numbers from the question during the audit about um year over year differences for PD, what's the 2026 budget?

Go ahead, Mr.

Parrish.

Uh yes, Your Honor.

And and agree, just we do try to look at the employee services as a whole.

I mean, I know you can look at the line items, but as referenced here by the group, you know, we're looking at regular salaries.

If we're under staff there, sometimes we will have over time, but we do look at that to make sure it all nets out appropriately.

And and then this reimbursed overtime is a very significant you know issue.

And we're paid for that.

It's a benefit to the community.

You can see a lot of the traffic control happening with the clinic right now as a benefit to our residents and patients.

So, you know, that all is looked at on a monthly basis to determine, you know, if we're we're on course there.

Uh, from a budget perspective, in 25.

Uh and we've we've trended tended to hit budget, you know, as we net all these things out very close.

Um in 25, the budget was 39 million.

Uh in 26, it was 41.8.

It would have been more substantial of an increase in 26, but when we went through our um reduction exercise, um, there was a fairly substantial adjustment in the PD budget by about 2 million dollars.

So the but for that adjustment, the growth would have been larger that particular year.

Um, so again, 41.8 million in 26.

Um, and then 27 were 45.1.

The vast majority of that is about 2.4 million dollars in employee services uh growth.

Again, this happens across all the the enterprise.

You know, we have adjustments in health insurance, we have adjustments in para and compensation, all that.

Um, but that also reflects the decision package to adjust two positions uh as well.

So um that's the that's the trend there.

Um we we have been discussing the potential for a broader evaluation.

I think you know we can well have more conversation with that in the council in the future, certainly committed to doing that too.

Thank you, Mr.

Parrish.

Uh other I was gonna land on this slide and say, do you have any other feedback?

I think we had a very solid discussion about the LGA discussion, and uh we will work on that for the future.

And then um the convenience fee.

Uh Councilmember Palmer.

I'm not in favor of the 20 funding the decision package that I see right now.

One of the things on there is a contingency for the ERP project, and that's contingency, and we may or may not need that.

And that's why we have an overall contingency fund.

But if I can say 1.4 million dollars, I'm I'm more than willing to do that.

Councilmember Miller.

You do you look like you had a question.

Councilmember Keene.

Yeah, I again I think these are things that we approved in the doing our work in 2025 for the two-year budget, or these are that's how I'm reading this chart.

These were presented in the 2026, 2027 two-year budget, but you still have to approve your levy every year, and so you get to decide if you want to continue to keep these here.

Right.

But in the numbers we've seen so far, these are assumed in.

Yes, those are in the 5.59%.

And I too had that same question that I'm surprised.

Not, I mean, I know what the ERP project is.

I know these things can are unwieldy and there might be need for contingency, but I am surprised to see contingency as a decision packet because then it's in there into perpetuity.

I think Mr.

Parrish could answer that.

Yeah, I mean, contingency is probably a bad way to say that.

I mean, we we developed an overall project budget um that we felt would be necessary to deliver it.

But there's also some reconciliation of the annual licensing costs that we're going to have going forward too.

So I would view this as a collective need of the budget.

It isn't um not uh set up, I believe, as a one-time package, but we can confirm that for you and get more information.

We bring the recommended budget back in August.

Um, but but generally that is part of what we had contemplated for the overall ERP project, which we funded and are advanced, you know, through at this point.

Right.

So that was my comment that it and maybe it is a titling problem as opposed to a spending problem.

But um, yeah, I I again we can re review these again, but I I wanted to make the point that I think these are baseline considered in, unless we make changes.

That's typically how we approach it.

Yes, you would be taking them out.

And I did just want to clarify the ERP, much like um Mr.

Boynton shared during the audit, software as a service has ongoing licensing costs that you need to pay for.

So you would have implemented a project that you can't use.

Councilmember Miller.

Yeah, it's it's not an item here, but we've talked about it in the past and the budget process, and so not for today, but hopefully during the the August or September discussions.

How we support community festivals, uh both through the community building fund, what the right level is, how that has functioned.

Because we talked about what level to support it at last year, increased it.

It does seem like that was quickly still used up early on in the year.

That's how we're managing that in the 27, but also community festivals like Rochester Fest, Fourth Fest, what the level of support is and how those are supported by the city.

Uh we can um bring you the information that's about the um outside agencies funding.

That's typically where we put that.

Um, although they don't all have agreements and they aren't all considered outside agencies.

That for example, Rochester Fest is somewhat of a legacy from celebration of a city.

Um, but we can bring some of that information to you.

I did want to point out that the building community fund, the grants um that Ms.

Motala does have plans in the five-year update, which I think is maybe at the end of the month, um, to share information on some intent to adjust and to have that be open like quarterly, so that they're not considering um grants as they come in, but rather can much like your discussion, considering them more in batches because there's sometimes things at the end of the year that they're like, well, we probably would have funded that over this other thing.

But so they are looking at changes to that, and the current funding level for that is 100,000.

Councilmember Wall.

Maybe even just a little bit more specific following up on Mr.

Miller's comment.

Uh to fund the fourth FEST this year.

I think we used contingency funds and went through uh um experienced Rochester.

Is there something in the budget for the coming years?

The way we actually ended up doing that is that we had we never actually took the dollars out because there was a lot of I couldn't quite tell if I was gonna need to figure out the fourth of July during the last budget.

Um so there was about 20,000 in um public music, but we also have access funds from when we were having to put the stage up at Riverside in the public music budget.

So it will it will not require contingency, but no, we do not have funds budgeted, but we could reallocate some of those funds in order to be able to support um the uh if they would like to continue to put on uh fourth fest having um experienced Rochester do that.

I don't think it would need to be an increase.

Councilmember Palmer.

Well, I I would uh agree with Mr.

Wall that we need to do something for experienced Rochester or I thought they did a great job, but I think we need to continue that, and if that comes out of the music budget, that's that's one thing.

Um but I don't know, maybe we need to look at Riverside um on Sunday nights and see if if they can do it cheaper or better or differently than we're doing it currently.

If you wanted to look at that, I think you'd be looking at a pretty wholesale change to public music, which is fine.

I just want to make sure that if there's comfort level with the rest of the council doing that.

I'm comfortable doing that.

I just want to make sure I'm not running down a rabbit hole.

I will say that Experience Rochester is on your study session agenda for I should probably have this in front of me.

Um in the future to talk about Chateau theater.

And that might be a good discussion to have there also with them actually with us because I don't want to speak on their behalf.

Um that is coming on July twenty-seventh.

Did Councilmember Keene?

Yeah, I'm I'm just gonna react to the discussion going on.

I I wanna kind of speak of that.

I d I don't want us to get into micromanaging other department budgets in these sort of discussions.

Like you say, there might be a good reason to look at the um the downtown events or the music events, but to do this like in a budget meeting on the fly without the staff involved.

I'd I I don't want to support that.

And maybe by being silent, I felt like I was so I wanted to speak up.

And I guess just to clarify my position, I I'm not necessarily uh I'm not endorsing Mr.

Palmer's recommendation.

I'm I'm saying I would like to look at our budget support of summer festivals, summer programming across multiple departments, and that's why I brought community building fund in there as well through Ms.

Motella's office because I think all of those things are supporting cultural and uh outdoor public events and just to understand how we're comprehensively supporting that and how we're modifying that so it's relevant for the community going forward.

Councilmember Doring.

Yeah, I I would agree that I would appreciate these conversations based in data and not just the re theoretical abstract.

So um I would uh I would I would love to see uh the information that both uh Councilmember Keene and I I really council member Miller has requested to come back to us for further discussion.

Any further uh feedback for the recommended supplemental budget, which we were here again in August.

Seeing none, we will take a uh eight-minute break.

Wow, it's kind of a lot of people.

February of 25, the council asked us to evaluate options to um do phase two of the regional sports and recreation complex, which we're now calling the Rochester Sports Plex.

Um that was really with the desire to meet some indoor recreation needs that we felt were unmet.

Umsequent to that, there's been a lot of evolutions in our community since uh this has happened.

Of course, you know, we had the YMCA, we've had um you know private facilities closed, we've had the dome announce that they weren't uh going to be reopening this fall.

Um so we've had some conversations with RCTC.

Um weren't able to really advance uh an indoor option there given a variety of constraints that you've all heard about.

Um and then we did get confirmation in 26 that the dome will not be reopening this fall.

Um just really want to talk to you about the policy considerations.

Um, really, this is just an ask of you to say, you know, do you want to consider utilizing any of these financing authorities to continue the conversation on indoor rec?

This is really just an opportunity for you to say, like one of these is you know the right idea at the right time, maybe it's the right idea at the wrong time, or maybe it's just the wrong idea all over, you know.

So um just really want to get your feedback on that.

Also just want to emphasize coming out of our previous conversation in June that we you know have made as many changes as we can to the Rochester Sports Plex site plan that would allow for a future dome installation, but there are many that are not cost neutral, and that we are you know continue to advance the original design for that project, um, and we just have to pick up those items in the future.

Uh a lot of evaluation in the indoor rec space.

Um we've we've talked about this, but really just want to emphasize those continued key shared themes, of course, affordability, community access and flexibility, um, opportunities for casual recreation, uh flexible scheduling, better communications around what we have, we're all themes that we heard in the four or so different efforts of outreach that we had on this topic.

Um option uh to meet indoor recreation needs, of course, is the the notion of a dome on the uh sportsplex site.

Uh I'm not gonna go through that, we've talked about that, but for context, you know, that could be up to 250,000 square feet of indoor turf space, six um indoor all right, indoor basketball courts, sport courts, uh indoor pickleball, indoor play area, um, you know, significant uh amount of square footage.

Uh by contrast with the original uh facility that was discussed on the sportsplex site, that was about 130,000 square feet, no indoor turf again, subsequent to all this, the indoor turf that people have grown to utilize and enjoy in Rochester is no longer available.

Um there are obviously costs uh to this.

Uh the request at the previous meeting was to uh consider pursuit costs or evaluation costs.

Um and again, we wanted to pause on that um with the understanding that you wanted to have a better community conversation around financing if you wanted to go down that road.

Um so we're here to kind of have that conversation tonight.

Um so again, not going deep diving, you know, on that because you've seen that.

Um, at that previous uh meeting as well, there was some conversation around our arts investments, and you know, are we doing uh enough there in that space?

I wanted to just highlight some of those because I think you know, you go through the budget processes and we sort of live year to year on these things.

Um, but really um sometimes when you take a step back, what some people might think is limited investment, you know, really is substantial investment.

Uh so a civic center, and again, I'm gonna say these can cut across a variety of things.

They're not all you know easily categorized into one bucket.

Um, but you know, if you look at our civic center investment, um, which does bring a wide variety of uh arts and cultural options to the community.

Uh we collect about 12 million dollars plus or minus of lodging tax.

Uh there's three different buckets.

We'll talk about that later.

Um, but we do provide about four million dollars per year to the Mayo Civic Center for operations.

Um, and out of that you get you know, events, you get you know, Bob Dylan, you get comedy, you get a variety of these other things that come in uh to the civic center.

Uh you also have a lot of venues in that facility uh that can host people.

So in the uh arena, for example, you can host up to 5,000.

I'm not trying to give you perspective on what people view as the user experience of this, but it is.

I'm just giving you head count numbers.

Um you can get 5,000 in the arena, 3,000 in the auditorium, and a little over a thousand in presentation hall.

Um so we we can accommodate large numbers of users in those groups in those areas as well.

Uh about a year or so ago, you received the facility condition assessment for the civic center.

Um, there's about 38 million dollars of deferred maintenance needs there.

About 15 million of that is just basic roofs, HVAC, plumbing mechanical work, um, 10 million of that or so is interior renovation work that would want to happen.

Um sort of prioritized and color-coded.

Um, but that's the 10-year projected need in that space.

So just want to kind of level set with you that you know, we have ongoing requirements in all of our facilities and the civic center at over you know 200,000 square feet is a major uh facility in Rochester.

Uh looking at, you know, one of the things I know there's obviously this larger community conversation around, you know, can we do uh presentation quality uh orchestra and other sort of large stage events?

One of the big gaps that's been identified is the stage space with the existing civic center.

Um option for you if we really want to compare 70 million dollars, which is the current estimate for the facility at Grant Park at 160,000 square feet, um, which I think 70 is probably a light number, at least with the numbers we're getting for those kinds of project costs, um, is can you have some opportunity to reevaluate um stage configuration, whether that be in the auditorium or we just did this in presentation hall again, a nice nice facility, but uh lacks the right amount of stage space.

Um, and just you know, obviously users you know want to be able to use it in certain ways, and there's you know, operational things, but just don't want to look past what you have on these things.

Um, so there is you know some rethinking if you ever wanted to go down that road of you know what could that look like uh as well.

Uh this is just a quick mock-up by our team saying like the presentation hall or presentation stage, you know, could be adjusted.

Uh other areas that we talk about in terms of arts and culture.

Um, here, you know, we certainly have the art center, civic theater and chateau theater.

Just operationally, you know, with the one roof, we have $379,000 per year of investment there, a little over 100,000, you know, on the chateau, but we put substantial money into the acquisition and subsequent renovation of the chateau.

I mean, that's probably a plus or minus 10 million dollars.

Um, you think about the previous investments we've made through sales tax and civic theater and the art center as well.

Um, and and we've at times in his in the history of Rochester made substantial investments in those uh spaces.

Uh you'll have more opportunity to consider investment in the chateau at your July meeting as well.

Um so I wanted to talk also.

I mean, we we at the operational level, you know, uh fund fairly significant arts and cultural activities in the library, um, in public music and the community connector grant program.

So the library has an annual budget of over 10 and a half million dollars.

You know, I think a plus or minus nine million of that is tax levy supported.

Um, and maybe a little more than that, well, about that uh with the county contribution.

Uh public music is at about 1.1 million, which is something that you don't see nationally, like public our investment in public music is somewhat unprecedented.

I am not come across another public music department.

Um, and so at a point in Rochester's time and history, you you know, there's a community decision to say we want to have this, we want to do these things, and we want to be able to promote it.

Um, but those two uh are very substantial.

And then the smaller you know, investments in arts and cultural programming happening on the community connector grant program are also meaningful.

Um, you supports things like Latino Fest, et cetera, um, and have had really great you know, great uh wide range of smaller activations that are done privately, which are meaningful as well.

Again, this is where you can start to see things cutting across a variety of areas.

So if you think about our 125 live investment, we we funded that for construction.

Certainly active senior living or active senior work happening there, but also lots of arts and cultural programs that happen at that facility as well.

There's lots of groups.

So just wanted to kind of level set that just for awareness.

But then on the financing options.

So that's really what we want to talk about tonight.

Certainly anytime you have these conversations, property tax is always an option.

You all just had a great conversation about like property tax and the competing priorities for that.

This isn't recommended.

I'm just you know giving it to you for reference.

Um I'm not even gonna go through all these numbers for you, but like you can see at different um uh debt issuance levels what you would need in order to support debt in those areas.

So again, just wanted to provide that for reference.

Maybe the more notable area of uh emphasis for this evening is there is a cities of the first class sales tax legislation that applies to Minneapolis, St.

Paul and Duluth and Rochester that allows you to do a couple things.

Uh and I'll just say uh when you asked us in February of 2025 to look at options for financing indoor rec.

Um, this was not something that we knew about.

Um, this was something that came up in the course of our due diligence in this topic.

Um, and so from that perspective, uh we you know weren't aware of that in the sales tax vote when we, you know, went through the legislative process, the vote process.

This is something as we were looking for options at your request that we came came across.

Um, this does allow us to collect for the full duration of our sales tax.

So right now, our sales tax is authorized for 24 years.

Uh, this allows us to collect for that full 24 years.

I'll talk more about the projection about that that the finance teams put together in a moment.

Um, however, it is limited to really two items.

So the second highlight there talks about it being eligible for sports facilities, which you know, again, indoor recreation options, certainly eligible for that, or convention and civic center.

So I would say at a very basic level, that would qualify for what you have across the street here.

I guess you have a great view of it out the window.

Um, that would qualify as you know, right now we consider that our convention and civic center uh in Rochester.

Um what kind of revenue opportunity do you have there?

Uh so really three points of reference.

Uh, first, our existing obligations.

The current sales tax was approved at 205 million plus any interest costs we accrue with the issuance of the regional sports and rec complex debt or Rochester Sportsplex debt.

Um, our estimated obligations are 241.5.

The other areas have been contemplated is pay as you go.

Um so 240 uh 1.5 million is that that'll probably be satisfied in 13, 14 years given the current level of collections.

Um if you go out to the full 24 years, uh we would project that you would uh collect about uh 394.5 million dollars.

Um, I think this projection is very conservative, so you can see that on the right side of the screen.

Um, two things to note there and why it's conservative.

We only do one percent escalation of that sales tax.

So again, sales tax can be you know uh go up and down.

Um, but uh generally speaking, 1% over 24 years is pretty conservative for us in terms of what we've seen historically.

Um I'd also say um for years 26 all the way out to 2032, we're projecting at less than we're collecting right now.

Um, so last year we collected over 16 million.

Uh we don't get back to that level until 2032.

Just again, another conservative way we project it.

So again, I think you can come to this with some degree of confidence with this conservative model.

This would still give you 153 million dollars to think about um what you wanted to do, uh, whether it be sports center or conventionslash civic center.

Uh this just shows you a cash flow for how you could maintain the four categories with uh the existing 205 million dollar allocation plus um the uh potential for a phase two for indoor rec.

Um, I'm not gonna go through this detail basis, but like again, it does allow you to uh work pretty effectively through um all categories.

Um, so that's your uh cities of the first class authorization that if you so choose, you can further explore.

Don't have to, but you have that option, it's available within the existing law.

Um, we also just wanted to highlight because there was some discussion about um, you know, again, what can what can you do?

Uh, and just wanted to bring this to your attention, uh, just so you can start thinking about it.

It's a little bit more operative in a few years.

Um, but our lodging tax legislation um does also give us some flexibility.

So we have three buckets of lodging tax.

So I'm gonna try to go over that quickly.

Um, there's a little bit of a misprint on the bottom, so I'll talk about that in a sec.

But our three buckets of lodging tax, we have one percent, which is for destination marketing or is designed to go to experienced Rochester.

Three percent uh right now currently goes for we'll call it Experienced Rochester and Civic Center operations.

Um, and then we have an additional three percent that is focused on debt service for when we did the MCC expansion um a few years ago here.

Um with that uh in 25, we collected about 11.67.

So that shouldn't be just the three percent.

That is actually all of those put into one.

So that's um just that's the total numbers.

Uh we're projecting for the three percent that I'm gonna talk about in a minute here.

That is for the debt service, that's about five million dollars per year.

So think about that.

Um, when we move on to this next slide.

Also, in our law, uh, when we got that the lodging tax extension done, and there was a rewrite of this around the DMC era.

Um, it's allowed for debt service for the civic center, and we can use it for pay as you go.

Uh investments in the civic center for we'll call it rehab, landscaping, skyway, and again around the civic center, but also just think about any physical investment in the civic center, we can generally cover with this five million per year.

As the auditor previously mentioned, our debt obligations are going to be um going to be uh satisfied in about 2034.

So in 2034 on, um, and might be earlier, but 2034 conservatively, um, you would be able to use that five million dollars for capital reinvestment in the civic center, or to redo a stage, or to upgrade the arena seating, or those are all policy conversations that you're going to want to have.

Um, but again, you have a fairly significant amount of deferred maintenance there too.

So balancing all that off.

Uh, we also have other funding in the current agreement.

Um, about a million is going to capital.

Um, so it's not like we're investing zero in capital in the civic center either.

So want to just make you aware of that authority, um, but really sort of land you on the the concept of you know, is this an idea that you'd want to consider?

Um, if you do, um, what how do you want to have the community conversation around that?

I mean, certainly there's another level of this conversation that wants to happen with community feedback and engagement.

If you were interested, we would bring you back a strategy that outlined how that could happen and make some recommendations there.

Uh, also, I just want to emphasize I think you all receive an email today just based on some questions.

I think there was a question around Cub.

Uh, could that be used for indoor rec?

Um, you can do anything uh with the right amount of funding and investment.

I'm not sure and in right price, right?

And it's not actively on the market this minute, but um, we've certainly have done our fair share of adaptive reuse as a building, some successful, some not.

Um, but uh there are some challenges with that.

Uh you uh it's 80,000 square feet.

Um so in the context of this discussion, uh, the existing dome, the existing turf space is you know, just under 100,000 square feet.

You're not doing turf in that building, you could do some gyms potentially at that square footage.

Um, however, uh ceiling heights not great, it's not ideal.

Um, you're probably 18 to 20 feet on ceiling height, which would be more recreational in nature.

You wouldn't want to do anything competitive, it wouldn't be a good fit for volleyball.

Um the other part of that is there's columns all over that thing.

So you've got about 13, 14, 15 columns, whatever it is.

Um configuring gym space within that.

So the shortest distance is like in the 20s foot range or 23 foot range, longer is 30 for gym spaces.

You want fifth, you know, conceivably 50 to 70.

So your gym configurations, your court configurations wouldn't be ideal in that situation.

So just want to lay that out.

Certainly we can always do more evaluation, but on its face, it seems very challenging.

So I've got a question, just a clarifying question on the lodging tax to start off.

So you you first we have a three percent lodging tax, but then you talked about a one percent for marketing, another three percent for operations.

So I'm unclear as to what is our lodging tax, and then I and then as a kind of follow-up questions is it uh a legislative initiative if we were to ask to increase that to four percent.

Uh and would that then uh would we then more rapidly cover our debt?

Yeah, so the the correct answer is is that um all those authorities are creatures of legislative action, and uh we have one of the longest continuously operating lodging taxes in the state.

Um and they are bucketed that way.

Um so if we wanted to go to four, we would have to, you know, request that authority from the legislature and certainly can do that.

Um you know, there is sort of a quest, and then the so I'm I'm getting off topic here, sorry.

Um so yes, on the four percent, you would go uh the one percent.

If you think about a lot of uh experienced Rochester-like organizations or called CVBs or destination marketing organizations, that one percent would go to fund their operations and not just for the civic center.

We think about it uh a lot because of the way it's funds the civic center now, but a lot of communities really just do it as heads on beds, marketing to marketing your community, total promotion, total marketing, um, no real operational considerations for facilities.

That's probably the vast majority of communities in our state use their CVB slash lodging tax money that way.

Um we have this other authority then that allows us to go three percent for experienced Rochester and Civic Center operations, and then the last is three percent or about five million dollars is for that debt service.

And the total lodging tax local lodging tax is seven percent bucketed in that way, it is different total is seven three, three, and one with different authorizations for use.

Yeah, council member Palmer.

And is my understanding that our it's my understanding that our lodging tax is the highest in the state?

Is that right?

I I don't know the answer to that.

Um it's higher than most, but I don't know that if it I don't know if it's the highest.

And one of the reasons we don't really usually like to raise it is because it's basically male clinic patients, and we're trying to keep it as reasonable as possible.

So let's um let's go back to what you're you're suggesting here.

Uh cities of the first class, uh 40 million dollar project.

Is that correct?

It has to be the minimum.

That is also correct, and I did not mention that.

Okay.

So if we wanted to do a 65 million dollar extension, would it take us about six years to pay for that um um indoor sports, so phase two of the indoor sports?

Yeah, certainly the debt service associated with the indoor sports at 153.

Um you have a lot of room.

You can go at least 65 million if you wanted to go that high.

But again, we don't have the exact number, but you certainly could could do it if you were trying to save up for it.

You have construction escalation you have to deal with, of course.

So you have 153 million available if we went to the full 24 years.

If you took the um Chateau Civic Center that we have in Rochester in into the 40 million dollar project there, would that also qualify?

I mean, do you just put the name Civic Center on it?

And or is there a definition for civic center?

Yeah, I mean, ultimately the council is gonna be the arbiter of that, but you know, you have to withstand the scrutiny of public opinion and legislative perspective on that.

So I would be somewhat judicious about calling everything a civic center when you have one.

Um but certainly that's that's part of your policy coming.

But but the other problem on that would be I'm just I'm just asking the question is is how would you spend 40 million dollars at the civic at the chateau?

Because I think the need right now is about 15 million, isn't it?

Yeah, I mean it I'm sure there's people that could think of ways to do that.

Um but uh well not be well but being reasonable and in prudent with the tax period dollars.

I mean yeah, I mean it it would I mean it would be an expensive investment that you'd have to want to maintain in perpetuity Mayor Norton So a couple couple things.

Um when we the newspaper articles started coming out about this.

I got calls from several people, and one of the calls pointed out to me, and I'm just gonna reiterate this as a fact.

We said we were going to build the sports complex, regional sports complex for 65 million dollars, and now we're talking about over a hundred million dollars on a sports complex that the community did not anticipate and was told it would be 65, and they aren't getting what they want for that 65.

I think we have all sorts of problems just within that bucket of issues.

This is you're you're jump, you're doubling the price, nearly doubling the price of a sports complex you said you could do for 65 initially.

Granted, things change as you moved along and and decided what you wanted to do with the baseball diamonds.

Um the Southeast location, again, no accessibility to kids on an easy basis.

So that came up.

I want to remind people in the administration and at the table here.

I will not be here to give you my unsolicited advice in the future about legislative matters, but our legislators are interested in also would be willing to make changes to the language in the law.

So just because today it says the things that we have written in front of us, and that we were told, all that can be changed, as well as a determination about whether a performing arts center or whether some other center would be considered civic in nature or not.

Maybe it maybe you can't justify in your head that it would be.

The legislators are ready to go forward to make changes in the legislation to try to help us make just like these were put in for initially Duluth and Minneapolis and St.

Paul, and then Rochester became a city of the first class.

All that legislation can be changed in a session with the help of our local legislators.

Um I also uh wanted to add the item of um community engagement.

Yes, I think we are jumping the gun, assuming the community wants a hundred plus million dollar sports complex.

I think we could ask if we're going to make any sort of changes with another 55 million or more.

We should ask the community what they want, just like we did with the initial four items.

And I think whether it be a ballot question, maybe that's the direction to go since we did that for the first time, about the options for spending this.

I think the community deserves to weigh in.

Um they feel like they haven't been heard to this point, and I think this is an opportunity for us to weigh in, but I feel like there's a real mismatch between what the recommendation in front of us is, and I know it's just a concept and idea, and what this community initially wanted and expected, and what you're proposing now.

I think it's a mismatch with this community and what this community wants.

So I just turned down an opportunity to add a fifth item to the sales tax extension when we could have done it the second time we went forward.

And I feel like that's a little bit about where we are now.

We're talking about adding something else, either adding to what we currently have or a whole nother concept.

And I just I think we need to be really careful about assuming what our community wants.

Um and think long and hard about how we move forward on this.

So I'll just end it there.

Councilmember Miller.

Yeah, just a question.

So if we do nothing and we're collecting at this rate, when we collect the 241 million, the authorization ends.

Is that correct?

That's correct.

Or could end.

Yeah, you it could end uh what we have typically done historically as a community a couple years ahead of that.

Um we've discussed what the next sales tax extension might be, and then tried to get the legislative approval and then position it for a voter approval two, three years, like in this case, we started this conversation for the original sales tax or the this one that was just enacted in like 2019-2020, uh, because it takes time to navigate all the steps.

And and so assuming the conservative projection, that point would be reached in what year.

Um, you know, I I think you're plus or minus 13 or 14 years from now.

Yeah.

So in about 10 years, we could be going back to the community to envision what sorts of projects we would go and say the community needs these things.

Could be street maintenance, could be flood control again, could be other things, but really do an intensive process.

So we're we're we're potentially considering a legislative authority that would allow this to us to extend this and extend that process farther in time.

So I just want to note that this is not 153 million of no impact money, right?

It does impact future projects for future councils for future community needs.

Uh the other thing I I just keep going back to is when we did the strategic priorities process, we we we changed them somewhat.

And my colleague, council member Keene was uh adamant that we had transformational capital projects, noting that we have a lot of projects going on right now and limited capacity, and we really have to focus on delivering what we've committed to.

And then the other one that several of us uh advocated for of reframing was inclusive growth management.

And I think of both of those and this timing question, and I just don't feel the community behind us saying, go ahead and do this too.

And so I I think it's really interesting.

I I'm glad that it was discovered.

Um but short of finding a way to sell this project or ask the community a version of what would investment be meaningful.

Should we invest now in an expansion of civic convention center facilities?

Should we do a sports complex phase two?

Is there a way to do that as a ballot question?

Just asking based on existing authority to go and say option A, option B, option or nothing.

Your Honor, um, yeah, I wanted to address that with the mayor's comment as well.

And um, I don't think you have the ability to do it as a ballot question.

I mean, in order to do a ballot, you know, you have to have a specific authority behind that, and it has to be something that is actionable that way.

And that I don't believe there's a specific authority.

You can't do a what we call an advisory referendum on a topic.

Uh as you if you could imagine if that was permissible, you'd see those all over the place, right?

I think that the real option, if you really wanted to do something similar to what you're talking about, um, would be to consider a statistically reliable survey, like we're doing with the community survey now.

Um, and we've done this before on other topics.

If you recall, we was like we did on golf, or you know, we've done it on other topics that you know have generated enthusiasm in the community.

Um that probably is your best option, and you could lay out a range of ideas, see where folks you know, land.

I think you'd want to be somewhat constrained in terms of what you would also aligns with your priorities.

Um, but certainly a statistically reliable survey could could be part of your engagement strategy, and that's something we've talked about the staff level if we were to bring something back to you.

To that, to that can I just interject for a second?

To that point, we have the community survey that's going out.

Are there recreational activity questions in that survey that uh that is ready to go out in the next few weeks?

Yeah, it's it's out now.

Um, and the at a high level.

We did some last year, sort of trying to inform the the process that we were in last year.

Uh, but this would be a better standalone effort, um, just so you could go deeper.

We will have some high-level things, but you also have to remember the community survey we're asking, I don't know if it's 60, 80 questions, whatever it is on all categories of city government.

I think it'd be better just to a good investment, it's probably 30,000 plus or minus to do something like that as a okay.

Back to council member Miller.

And from a timing perspective on this legislative authorization, there's nothing special about the time period we're in now.

It's it's during the authorization.

Is that correct?

That we could exercise this at any point theoretically.

Yeah, yes, and though, here's what I would say to that construction escalation costs.

Um there's no um the S on that, but I'd also say legislation changes all the time.

Right.

And people may change that.

Yeah, you know, in the future, they may say, well, the cities of the first class sales tax legislation isn't something we thought we wanted to have forever.

Um, it was a creature of the time uh when this was created.

Um, you've seen significant changes in the local sales tax legislation landscape since you've adopted this.

Um and we had a major point of consternation when we went through this process in the past, we've did 12, 15 projects.

Um, the legislature limited us uh to well, three, I think it was, um we went four, if I remember right, or somewhere in that nature.

And it it felt different for people.

So there was we're just coming out of a sales tax moratorium, no sales tax provisions adopted in this year's budget.

So I the future can be uncertain in these things for sure.

Definitely.

Um I guess where I would just say I I am at this point is when we go to the legislature for sales tax authorization, there's a lot of effort, a lot of community engagement, a lot of refinement of the council to then devise this series of projects.

And then because we need the community to vote, should the legislature authorize us to go to the ballot, we then have to sell these projects to the community and and tell that case.

And so if we were to move forward with something like this, I I think without that robust community selling the project, making sure it's refined and meeting the needs of the community.

I would not be in favor of advancing any series of 40 million dollar plus projects under this authorization.

I would also just know, again, with the transformational capital projects, we have a lot of stuff going on right now with construction and in this particular period up to 2030.

I I continue to hear from the community that are kind of tired of new things, wondering what else is changing.

And I I wonder about this rate of change and progress and how we're keeping people engaged.

And so I I just don't feel the urgency to do it right now.

I think it's a very interesting authorization.

I think it's a great opportunity.

But looking back to our priorities for those two reasons, I I would want to do it as a more intentional public engagement process and make sure that this is the right project for the community.

Councilmember Wall.

Thank you, Mr.

Miller.

Uh, I think that uh you probably just said what I was going to say, particularly the question about, and I appreciate Aaron's answer.

Uh, couldn't we consider this in five years or eight years when it and legislation can change, but is there an immediacy to the decision that we have to make it happen right now?

Um I am in the same camp as Mr.

Miller that I would find it difficult to uh put forward any kind of large project and the tens of millions of dollars because I don't think the community is ready for it.

Uh I've already knocked on 1200 doors.

Uh and it doesn't come up very often uh really, uh, but I think more often in social media, it comes up uh rather than in personal conversation, at least uh for me.

Um I when we had the disappointment of the 65 million not going as far as uh we had been led to believe it could.

Uh I was of the opinion at that point, and maybe I'm coming back to that opinion, that we be as responsible as we can with the 65 million, and we show the community how this can work for the community.

And then uh as we find success in that, perhaps a community is more willing to take a look at expanding into different kinds of uh opportunities, indoor dome.

I that that's going to be a pain for uh our community for sure, an indoor dome.

Uh but maybe an absence of uh two or three years uh will change some community sentiment.

I I don't know that, but I would be uh happy to wait on this kind of discussion.

Councilmember Keene.

Yeah, I had a couple of questions first, and I think uh I uh on the sales tax extension and this idea of the cities of the first class, is there an example of one of the other cities using this in any big way?

Um yes, I I'm not gonna recall the project specifically, but it was one of those things at the time that was came out of the US bank legislation.

Yep, it was written for a very specific purpose, but as can happen, a city of the first class, you know, benefited at the time in 2012 when this happened.

They made it available to others.

We now have the potential to benefit from other for it as well.

Um, so there was a specific project around in St.

Paul or is it in Minneapolis?

I believe it was St.

Paul, but I could I'll follow up with the group.

Okay, I didn't know it was used, I just thought it was there.

Um, and then on this discussion with lodging tax, I might have read too much into it, but is that it looked like it was less of a sportsplex sort of thing and more of a community performing arts phone function.

Is there language in there that sort of like drives it one way and basically keeps it from the other side?

Yeah, I mean, I think it really keeps it within the confines of the civic center.

Yep.

Um, and and I just wanted to forecast the idea that if you ever thought you needed to make renovations to that to accommodate community need, you have some potential source of funding for that.

Okay.

All right.

I up front now.

I know I want to just go through these, like on the you give the three options with the property tax thing, it really does not make sense.

I mean, even when we were doing the sales tax, I viewed there was two projects there that were but for only we're only gonna do if the sales tax come.

I mean even when we were doing the sales tax, I viewed there was two projects there that were but for only we're only going to do if the sales tax come uh but the other two were really those were city you know the thing with uh flood control and with uh streets those were things that we would have to come up with new ways of doing but I don't consider this something that belongs in the uh to be weighed in the on the property tax.

Um as far as the the um discussion on lodging tax it's interesting but at the same time it does sound like there's legislative things and it almost takes us off this whole sportsplex discussion into a in a different direction.

And I think it did come up in our discussions in in June so I understand why it's here.

Yeah.

As far as the sales tax extension, yeah I I just do not feel the authority based on the votes that we had that that we here in a group or that I as a member of a group could support that with the idea that don't worry it's legal so I I don't think I would go that way um and I do like the idea of um like as much as the escalation of construction let's do what we've got on the plate right now and do it well and then find out where we're at in 2031 and see you know what you know what kind of successes or failures we've had and what the next things are to do.

Yeah council member Fredericks sorry yeah oh did you have a follow-up question well I want to get in here yeah and I also just um I I wanted to see if like is that what you're hearing from others or is that do you yeah your honor I I'm just trying to navigate you through this conversation and and this is a discretionary project um but I also think from a policy perspective from from your from your seat having clarity um you know on the fact that uh this is an option that we're not pursuing and so people understand that we won't have a dome next year so the soccer landscape will change the indoor senior softball landscape will change for people um name the you know parks will make decisions uh based on what they need to accommodate in other areas um for facilities etc no these are quality of life discussions and i and no i'm concerned about them but um the other thing I wanted to talk about again and and if someone can help me with this today or another time this idea of reliable surveys and what the community really wants I through this whole you know three year odyssey it's really difficult thing for me to to get my head around even to the point that the sales tax we had a like under 55% approval and we say oh good we have we have this like uh authority now do this that's that's less than you know we're just above half of the citizens saying this so when is it that you really have this like what this we use this term what what our residents want and unfortunately many of us have our own set of people we talk to or don't talk to and and so I I really have struggled with getting my head around that um and the last comment is I still think we're we've we've sort of simplified this discussion down to indoor and outdoor but I still think we're not talking about the same things when we talk indoor there's a group of us talking about like community assets that can be used at us you know at a certain level you brought up you know it doesn't come up as a main driving force but the YMCA closing and that's a that conjures up in people a sort of asset that's dramatically different than an eight basketball basketball court that also has two gyms and we just we seem to have simplified the discussion down to indoor or outdoor and I I think it's a lot I don't I think we have a lot more tentacles in the community with different opinions on that than what our discussion is is representing council member Fredericks.

I like the idea of anything that gives our weekend economy a shot in the arm Friday through Sunday we see a large difference in traffic in our community and I I like the idea of having the sports community um action in town it's it's a good vibrant uh crowd they bring a lot of great things they spend a lot of money they do great things for our economy I like that this particular project I just don't feel good about it right now I don't feel like we have a well thought out plan um I don't I don't feel good about the way it presents myself um I don't have a great idea what it what it should look like or anything like that that's not my expertise but yeah and I'm sitting here thinking when are we going to run out of workers to get this stuff done it's like crazy what's going on in our community and I do uh I am very comfortable walking down the hill slow and drawing an easy breath if it's a little bit more in a few years and we get a lot better product it just makes sense just makes sense rather than do it quick and be like oh we should have done this we should have done that why didn't we do this why didn't we do that I just I just don't think we need to do that just use a little common sense and take our time and do it do it right if we do it.

I don't know and I will add this comment I don't know why I'm saying all that ever came into into play.

This was supposed to be tournament facilities this is supposed to be a revenue generator for this community with some benefit to the community when not in use for those things.

It's not supposed to be our leader.

It's not supposed to be what we lead with that was my understanding.

So and I don't think that's really changed.

So I do want to see it be something that with a secondary benefit being facilities we can use when it's not being used for tournament play and things like that.

Councilmember Dory.

I also am not ready to move forward uh with this project, which is is hard for me to say because uh I have heard overwhelmingly from the community uh for the desire for indoor recreational opportunities.

I I appreciate uh council member Keene's uh last statement about there seems to be a disconnect uh from the community that I'm hearing from primarily that wants a place for recreation rather than a tournament built facility, right?

So uh I appreciate that the hard spot that you're in.

You've you've you've heard our feedback throughout the course of this process about the community wanting indoor recreation opportunities.

You've presented a project to us, you've you've done your due diligence that way.

And I'm I'm I'm sure it's not the easiest thing to hear us kind of say, uh, we're not quite quite ready with that.

Um I don't think I don't uh based on the conversations that I I hear in the community.

I don't think that there it would be support uh to to build a project of this scope or magnitude, uh, just throwing it on the property levy.

Um I property tax levy, I that's a no-going for me.

Though I also agree that the lodging tech stuff is interesting to me.

Um, but I I need to do more due diligence to understand that.

I appreciate you bringing us forward the options of uh continuing to collect the sales tax beyond the current scope of of what we promised the community that we were going to collect it for at this point.

Um, but I think I've I've said before as well, just because we can do something doesn't mean we should do something.

Uh and I that's kind of where I'm at with this, without increased community conversations, making sure uh that this community understands the ramifications of moving forward in in that collection of sales tax.

So uh I I'd be willing to to wait for a while to make to ensure that though those community uh conversations could happen uh in a very robust way, but at this point, I'm not ready to to move forward.

Thank you, council member.

Uh and I I guess just to kind of wrap this up, I would say we're kind of in a place where we're sports complex fatigue.

I feel it from the community.

And I think uh just kind of picking up on what all of my colleagues have said, I think I think what we need is something real to show the community.

And we do have the facility being built, and it is opening next year, and uh success for that will be the best thing for any future extension on that.

I would go back to, and one, I I I appreciate council member Doring really giving the staff uh credit uh cred on this because you did do what we asked.

This has been an issue that we've talked about.

This council has talked about for over a year and a half, and uh part of me is I am really fatigued with relitigating that 2023 vote.

The majority of us here were not here at the time.

But what I can say is that our staff listened to us when we said we do want the community is interested in indoor, and you folks were very creative.

We worked for months and months with RCTC on looking for options there, and through that process, this was discovered.

I also want to say that what we've also talked about is really looking at increasing the visibility and marketing of our recreational uh facilities holistically.

I think that's what we need to focus on in the in the short term in the next year, and that includes visibility of our partnership with RCTC that still is a partnership.

Uh we will see some kind of impact with not having the indoor uh uh turf field uh dome that uh RCTC uh decided not to put up after this year, so that we will feel that effect, but I I do want to keep drilling on let's get tighter on what that visibility campaign is for all of our uh all of our recreational activities and um take a pause on this for now.

With that, Councilmember Milley, do you have a question?

Yeah, one closing comment, if I may.

I appreciated the conversation and presentation about how we support arts and culture in the community.

What I would just note though is that where sports and recreation falls clearly under one department of uh parks and rec.

I think public music holds part of it, and then there's a gap on the other support.

And I think that's something we're gonna have to figure out over a longer term of how do we support arts and culture from an official government perspective, and that might look like an evolution of public music, it might look like an evolution of another department.

But I do think it is a missing piece of official support.

Thank you for that.

With that, uh let's move on to uh Chief Frank and persons experiencing homelessness.

And unlike our first three topics, Chief, you only have half the amount of time.

Well, good.

Well, good evening, uh Council President, Council members, mayor, uh, city administration.

Thanks for this opportunity.

This was uh your request for us to come back and report on all of our efforts.

Really, uh the purpose of this presentation is really just to illustrate uh what we're doing from a police perspective, the type of outreach uh that our officers and our Rochester Police Department homeless navigator uh are doing with individuals who quite frankly require uh really the greatest level of service within our community.

Um I am incredibly proud of the work uh that these individuals are doing.

Uh and I'm excited to present this to you today.

Uh I'm gonna let uh I'm just gonna do a quick opening here, and I'm gonna let uh Captain Jennifer Hodgman do most of the speaking, but I also brought uh Lieutenant Greg Gerdo, who, in my opinion, uh uh probably knows more about uh people experiencing homelessness in this community than anybody I've I've met before.

Greg, in my opinion, is a subject matter expert.

Uh he has dove into this issue head on and uh with courage and professionalism.

I appreciate that.

Uh Captain Hodgman heads up our community services division, which houses that uh community action team.

Uh before I turn it over to them, uh just real quick.

I do need to go back to Council President Schubring's question, or that now that I kind of have further clarification, you are correct, sir.

Terry DOS right now is funded as a point five under a contract.

If this is approved, this budget request is approved.

That is a net 0.5 gain as an FTE position.

So I just wanted to offer you.

Thanks for that clarification, Chief.

Appreciate that.

Uh with that, um, I'll just kind of jump in here on the first slide.

Again, uh, I'm incredibly proud of the work uh that these guys are doing on an absolute daily basis.

I think you're going to see that uh as we engage uh this population within our community, a very difficult, complex issue uh that quite frankly, cities our size struggle with across the country uh as we do.

But uh we do it with compassion and respect.

And I think you're gonna see that reflected in this presentation here.

And with that, I will turn it over to Captain Hodgman.

Thank you, Chief.

All right.

Uh thank you again for the opportunity, Mayor, Mr.

President, Council members, administrators elms for this opportunity to come uh before you and give uh an update on our response to homelessness here in Rochester.

I'd like to begin by acknowledging what everyone here knows.

Homelessness is a very complex issue, right?

And as Chief Franklin said, our approach is guided by compassion and respect, while we also recognize that accountability and uh enforcement remain necessary components of an effective response.

So, what are what are we doing?

Our role is much broader than just simply responding to calls for service.

Our officers are regularly engaging uh individuals experiencing homelessness.

We're providing information about available resources, we're attempting to connect people with services, and we're working collaboratively with our city, county, and community partners.

One thing that I want to emphasize here is that our response to homelessness involves more than uh just one person, one unit, one division.

Um it's not simply the responsibility of those people.

Patrol officers are responding to calls every day involving homelessness.

Our community outreach specialists are dealing on a daily basis with those individuals in our community who are experiencing mental health crises.

Our CAT team is addressing chronic issues, problems, um, problem locations, camps.

And since March of 2025, um, our contracted homeless outreach navigator, who you all know as Terry Dose, um, as you'll see throughout this presentation, has added another important layer for us in our response to homelessness here in Rochester.

So together, all these resources allow us to be much more intentional and strategic with our resources.

So here uh for our the police department, we uh use what we call a 3e approach, and our approach begins with education.

We want individuals to understand what the laws are, the the services that are available, what resources exist in our communities, and what expectations resist or exist, excuse me, uh, regarding ordinances and the use of those public spaces.

Whenever possible, our first interaction is always to educate about providing information and creating opportunities for voluntary complaints, um compliance.

The second approach is encouragement.

This is the second step for us.

We provide someone with resource with a resource guide is one thing, right?

But successfully connecting someone with services is a completely different.

Um, our patrol officers, our cat team, our homeless outreach navigator, they all work to encourage individuals to accept services, make referrals, and conduct follow-up.

The persistence is important because we know that someone might not accept services that first time or even the tenth time.

The last step in this is enforcement.

And enforcement is used obviously when education and encouragement have not been successful and when officers have probable cost believe that crimes have been committed or activities have occurred.

We are intentional about the sequence of this approach.

However, compassion and accountability are not mutually exclusive.

Uh, there are circumstances where enforcement is necessary to protect public spaces, protect uh community expectations, and address criminal behavior that we're seeing.

So the next video that we're going to show you is a success story that we have by the name of Matt.

And Matt is an individual who we've dealt with for several several years.

Uh, he was an individual who you've all heard us talk frequently about the top 10 lists and kind of how you go on and off the top 10, um, is really all related, and I'll show you here in a couple slides, related to contacts and hours for service.

And again, it's our most uh resource-heavy individuals, the ones that are requiring the most attention from law enforcement and our and from Terry.

And so Matt was one of those individuals.

And a couple weeks ago, he sent a uh text message picture to Officer Van Tiker, and it was just him with this huge beaming smile, and it showed a full set of brand new denture teeth that he was so excited that he was finally able to get.

Now, Matt is now in housing, he has a full-time job, he's successful, and he's hoping to continue that momentum.

And have we stopped our contact with Matt?

Absolutely not.

So, this contact, this relationship that was built has gone on for a very long time to the point that hey, his his number one contact when he gets his new teeth is to send the officer a picture of it.

Um I will say that he's very soft spoken, so hopefully the volume is turned up enough uh that we we can hear him, otherwise we might have to restart it.

And uh team decided to show up.

I think that was a lot of times we started really drugging to try to accept some help.

Yeah, we're right back in that one.

They walked up, they were talking to me.

Um it was minus 30 degrees outside of the windshield of minus 50.

When we go out and visit Matt, is uh only request from us would be to bring him hand sanitizer.

Because the hand sanitizer starts a quick little fire, which will keep them warm during the winter months when it got to those brutal temperatures.

I tend to isolate myself from everybody from the whole world.

That's just the way this is what drives it to me.

We let him know how much it meant to us for him to do better, and therefore he would do better.

He didn't even care about himself enough anymore to overcome.

But I think with knowing that it mattered to us that that changed and made a difference.

I think coming from the perspective of police officers showing that compassion that we do care about individuals, and we want to see them succeed, and we can offer them everything that we can, but uh we need their assistance to also help with that transition.

So for him, it was just that constant contact, uh building that friendship, that relationship.

Um, what you've accomplished over the last call year and a half, right?

What you've accomplished over the last year and a half.

I mean, USB model which everybody does.

And you got over those and you can continue to push forward.

Right now, yeah, well, I'm trying to say.

Thank you.

All right.

So that that's one success story.

Going forward, what does that top 10 list look like, right?

Um, here is just representational of the amount of people that have the most police contacts in one particular month.

Okay.

So you'll see the range of this this particular month's top 10 ranges all the way from some people have 29 contacts, some people have 10 contacts.

Now, these contacts are calls for service.

These are not the contacts that the cat officers are having with these individuals.

These calls for service are coming in from dispatch, they're coming in from citizens.

These are quality of life issues, these are people being disruptive, it's public nuisance, it's trespassing.

The next slide is the amount of hours that some of those individuals are taking of officers' time.

These are again our most heavily resource-dependent individuals, all the way from 22 hours down to 11 hours.

You guys have seen some of some of these brief updates, if you will.

And this is just kind of a snippet of what Terry provides to leadership about who she's been dealing with this month on the top 10 list.

And what I want to emphasize here, and you can read from all these different paragraphs of people, is that it requires persistent relationship building.

It's Terry getting out there on a daily basis.

It's the CAT team officers getting out there, re-engaging with officers, reminding them of the services that are available.

It's not always a linear progress, right?

Like some the success is going to look different depending on that individual.

You can see from some of these um some of these summaries that they're not all individuals that are even originally from here.

And I think that's a trend that we're going to continue to see as some of the outlying communities surrounding us don't have the resources to address some of these issues.

We're going to start getting those people who are coming here from like one of them is Winona County.

And so there's this kind of conflict going on between is this an omested county individual, is this a Wabasha or Winona County individual, and who pays for those services that they're going to be getting in terms of treatment and stuff like that.

The other thing that's very important to point out here is you'll see from some of these summaries is these these are messy.

These these lives of these individuals are messy, and it's not just as simple as placing them into housing, it's ensuring that they have substance abuse treatment.

They have the resources necessary to get in to mental health help.

And sometimes that comes from being placed in jail, so everybody can kind of level set and get started from ground zero.

And that's where Terry also will do a lot of her work, is getting into jails, um, our jail here and connecting with these individuals who maybe now are ready to go to treatment, or maybe now are ready to have rule 20 evaluations done.

Can you hold them in council member Miller?

Just for clarification, can you define what a rule 20 evaluation is?

So rule rule 20 uh evaluations, and correct me if I'm wrong on that, are quite complicated, but it requires a court to determine that somebody is not mentally capable of providing some of those decisions for themselves, and therefore kind of takes the court system will take that over for them.

And most oftentimes it is placing them in maybe a facility or putting restrictions or conditions on them remaining in the community.

Now, the difficult thing about that is the amount of, and we we had the number, I apologize.

I can I can get it for you as well.

We had the number that Omstead County uh recently had seen in terms of rule 20s, where if it was like approximately 75, the amount that maybe actually went through were like five or 10.

And the reason for that is is because if you're allowed the opportunity to stay in the community to to make sure that you're doing this, this, and this, and you actually do it, you're not gonna get committed.

So there's kind of that that loophole there for us.

However, one of the great things about us having um Terry DOS in this position and having that social worker in that position is that gives us a seat at those tables where they're having those discussions about these are the people that need the rule 20 evaluations, and here's how we're gonna get them services because this I see them every day.

I'm out there, you know, making sure that they're doing there are a couple individuals who will have summaries here that that need it, um, that are living in the community that are doing what they need to do in terms of what the court expects of them, and so they're allowing being allowed to stay here in the community and not being committed.

Great question.

So this slide here is probably one of the most significant data points of the entire presentation.

And this highlights really that from January of 2025 to March to May of 26, 81 different individuals have cycled through our top 10 most contacted lists.

Through our persistent and focused outreach, 54 of those, 81, nearly 67%, they've all transitioned off the list in one month, which is is pretty amazing.

Um, even more importantly, though, is that 41 of those 54 individuals have remained off the list.

Okay, so that means nearly 76% of the individuals who initially transitioned off the list have sustained that progress.

And that's not just because we drop away and allow them to do things, it's because we're continuing to have that contact with them.

Terry's continuing to see them, we see them out and about, we're continuing that dialogue, and we have that relationship that we've built.

So, like we said earlier, this isn't just dependent on the cat team and isn't just dependent on Terry DOS.

Patrol also has a part in what's going on in the response to homelessness here in Rochester.

And this this slide here highlights that in May alone, patrol officers approximately 760 hours were spent working with the homeless population.

And again, this is going to be calls for service that are generated from the community.

This is going to be times when maybe we don't have Terry here or our CAT team members are gone.

This is maybe the weekend, this is on holidays.

Um, to put that into perspective, though, that's 760 hours that those officers could be responding to other calls for service within the community, that they're not able to do that.

In May, we had um 536 or 538, sorry, incidents involving um homeless individuals, and that represented a 2.67 increase for us just in the month of May.

Um, we recognize obviously that incidents are not the full story that it's why we look that's why we look at the number of contacts, we look at the location, we look at the officer hours, individuals involved, and we look at the outcomes.

Council member Miller, just for clarification 200 2.67% increase compared with May of the prior year, the prior month, what is the increase from?

April.

Yeah, April.

April, okay.

Previous month.

I didn't we haven't had the numbers yet for for June.

So, what else is the cat team doing?

So, again, we have a continued presence that we're maintaining in the skyways.

Um, this slide here kind of highlights the reason that it's important for us to maintain that that presence because the last thing that we want is it for everything to divert back to the way it originally was, right?

And so, if the concern is is that if we completely just walked away from that that skyway presence, that these conditions could return.

Greg's here, and he can maybe talk a little bit about the camping response if there's questions about that.

But I I wanted to bring this up because there always seems to be questions or a misconception about once a camp is reported that it's like immediately um removed, and that's not actually what occurs.

There's an entire process that we go through, and a lot of it again goes back to those three E's.

We're educating them, you know, we're encouraging them, and then we're enforcing it.

So it gets, you know, a camp gets reported, and then our officers and the cat team will go out and take a look at it, and then we're posting the cleanup time, and then we have to come back and clean up whatever is left, and that's not just a burden that the police department shares.

You know, we're sharing that with public works and with parks.

Anything else you wanted to add on that?

No.

Okay.

As you guys know, the camping ordinance, right, is prohibitive of camping on city property and city ride-aways.

The number of detected camps that we've had has been decreased significantly since the ordinance went into effect.

So, in general, the camps that we are seeing are smaller, they're cleaner, and they're more mobile.

This slide here shows that it illustrates the difference between where we were and kind of where we are today.

So that's what the the pictures on the left before the ordinance.

This is what most of our camps used to look like, and now this is the recent stuff that we're seeing.

Terry wanted to be here, however, she's in Iceland this week with her daughter.

So we got a video that we had her record on what she does.

I am a social worker.

Um, I am the homeless outreach navigator currently for the Rochester Police Department.

I do a lot of walking in the streets, um, the skyways.

This is this was a very popular place uh in the winter.

We go to places where I can find folks that are unhoused and try to help them get connected to services and resources.

Housing, substance use treatment, food.

I get a lot of steps in.

The beauty of the work that I do is if I need an officer to go with me, I've got one.

I can grab somebody, we we hit the streets.

So some of those folks that are a little bit more difficult or that struggle a little more with mental health and substance use, particularly the substance use.

And so they usually tell us if someone's struggling, if someone, if they know someone is hiding under the stairwell, or if they need some help by building those relationships with folks in the community, it has helped us to find people and access people and build rapport with those unhoused folks.

I met a gentleman down in the subway, actually.

We were down on the subway.

And I have been trying for months, probably I'm gonna say almost closer to a year to gain some rapport with this guy.

I don't know.

I don't know if he'll consent to talk or not, but I do need to have a chat with him.

But he sees us and he darts away, you know.

And I've I've tried and tried, but just recently, for whatever reason, he has chatted with me a little bit.

And when we saw him today, um I asked you not to go down there because I didn't want to scare him away with the camera.

But he agreed to meet me at the library.

So, what time you usually had the library about 10?

Yeah.

Yeah, I'll meet you over there a little bit later and we'll sit down and get that filled out.

Okay, Terry, remember Terry?

And he was there at the library at 10 o'clock this morning.

Um I sat with him for an hour.

I got I did the coordinated entry um paperwork.

Um he signed some releases for me.

He agreed to um see a doctor.

He agreed to have a diagnostic assessment, which these are all tools that we can um use to help him get help.

Catch a lot of folks over at the Salvation Army.

I'm over there, I would say daily lately.

I tend to go there late morning or close to the lunch hour because a lot of people go there to eat.

I have have had good luck there.

Staff have been super helpful.

Um we just work together to get folks some help.

And then at the very end of the day, I come back up to the North Station at the end of my day.

Um, I make phone calls, I do any referrals, I refer people a lot to the DART team for the county, Olmstead County Housing, um, I refer a lot of people for mental health help for case management.

I just feel it's been a big effort by RPD too to to really work on this.

And the officers that um in particular from the CAT team that work on this, they are um a lot of heart, you know.

They don't go at it from a um legal or punitive view, they go at it from we want to help you.

And here's Terry, what can she do for you?

It's just been a great combination.

We've um accomplished a lot.

All right.

Uh Councilmember Fredericks.

I greatly appreciate the proactive re approach versus the reactive.

It's incredible.

And I and relationships is what makes change happen, and I just really appreciate that aspect that that's the avenue you go about it.

I witnessed it firsthand.

I went out with one of your officers early morning, went through the skyways.

Were my patients would have ended?

I mean, his started, it was unreal.

I could not believe calling everybody by first name, going through things with them, helping them pick up their stuff.

Uh I was amazed.

And that that sort of compassion goes a long ways, and that is how you get through to people and get them to let their guard down, build some trust and make some change.

It's impressive.

So I just wanted to ask, is there anything more we could do to help you out?

Yeah, I think that plays into the to the next slide.

Um council member.

Uh first of all, we don't we don't want to lose the momentum that we have.

You know, I think is Captain Hodgman said, uh, we feel that if we do stop walking the skyways, we do stop engaging that we'll kind of lose the hill per se, if you will.

So I think we need to keep our foot on the gas uh in reference to this.

It's why we need the additional officer and why we need this FTA position.

That's why we're asking for it.

Um, understanding that we've you know provided, I believe, proof proof of concept and the value of having this navigator embedded alongside of the police department has been incredibly uh valuable.

It's why we pivoted from two police officers to our current ask in front of you today.

Um I I think there needs to be further analysis of you know of the different resources in town and how we can work together uh better and the potential impact that those resources are actually having on the town, uh, particularly uh any new additional resources that are brought into town.

I think there needs to be kind of a collaborative discussion in reference to those.

Um, and then uh, you know, with that the second lens there is accountability for all the services being rendered down here and how we again come together for this holistic collaborative approach of solving probably one of the most difficult problems out there for most communities.

Council member for uh council member Miller.

That's the last uh just a question logistically if uh Terry Dose is currently 0.5 FTE and you're asking for a full FTE.

What is the additional capability of that additional point five?

Is this a single person?

Is this that that person would be able to talk with the top 20, 50, some other like number?

Is it an ability to engage with providers and partners that is not within the scope of hours today?

Is it something else?

Is it some combination?

Uh great question.

Um, actually, um we did actually apply for a grant for uh another contract uh navigator.

Um, unfortunately, we were just notified, I think a week or two ago, that we did not get that grant.

Uh part of the discussion that I had with the city administrator was well, if you get that grant, you still need this FTE position.

The best way I can answer that question is yeah, we need them both.

There the bottom line is there is actually uh more there's enough work there for probably one and a half, two FTEs uh above and beyond just the point five that we have.

There's more work in front of us than Terry can actually do as a.5 employee is the best way I can answer that question.

So we would just continue the same efforts, just more.

And I I guess as a follow-up, and uh, you don't have to commit to this, but when we asked when you were last here, I asked, well, how soon can you scale this up?

And so I'm I'm glad to see that the request is to scale this up.

Does that mean keeping Terry in the role and then moving her to a full-time?

I would prefer if she never retires.

So at some point you are correct.

We need to figure out how do we duplicate that.

Sure.

Um and just to just to add maybe a little bit more context too, is part of this certainly Terry Dois is the magic sauce.

I'm I mean, she is wonderful, she's a gifted individual that has the ability to connect with people, build trust, and then and then help guide them into services.

Um, but the the strategy behind the top 10 is you know, is really is a pretty smart strategy in the fact that we have to um have a targeted approach, not targeted from punitive, but targeted from hey, you know, you're coming across our radar the most.

And and these again, these are the people that need the greatest level of service within our community that the most service resistant, and how do we get to them?

And that's part of the the strategy, the brilliance behind the top 10 piece.

Uh, and and again, as the captain said, um, we're very proud of our success rate.

And uh, again, is it gonna hold?

We'll see.

We'll see.

Uh, and if people come back on the list, 100% they have.

And I would add to that if you at any given time, I think within the county and the city of Rochester, there's a couple hundred people that are unhoused or are waiting to get into housing.

We are focusing right now on the ones that are creating the most social harm for our community members.

And that that's what makes up the top 10.

Okay.

And I I know we've talked a lot about the homeless navigator or this homeless outreach coordinator position.

What is the capability that an additional CSO offers in this space?

Or how do how do should we interpret this pairing of the request?

So it's it's not a CSO, it's a police officer.

This one is for the so we modified the decision packet from two officers for the CAT team to Terry as a full that position as a full-time and um uh our CAT officer.

And the CAT officer is if you maybe want to speak to that, all the different things that we have planned for that person.

Okay.

Yeah.

In this particular role, uh, as with Matt, what you'll find is when you go out and you're you're talking to some people who have lived some pretty rough lifestyles and had some pretty bad things happen to laugh and end up where they are.

And when you go out, you can connect with that person and bring them back, it'd be very similar to you going to your doctor, and the next time you have to go see a new doctor, and you have to tell a very personal thing about yourself to person after person, you're gonna be frustrated very quick.

That's where we put the right person in that spot, like Matt and I have done and some of the other officers on CAT team is you get to know the individual, and you like I said, you know how to build that person back up like Matt Short.

Uh he didn't always like us, but he's very happy that we kept pushing and pushing on him to get to where he is.

And like he says, he wouldn't be in the position he is without us.

But you're not going to get that by sending a different officer every time and somebody having to start over their story because they're just not going to start the story over.

They're just gonna walk away and leave.

That's the importance of having that designated person and to pair them with somebody like Terry, who has the ability, the resources where she can make things happen right now that we just don't have that ability.

And she has the time to work with the jail and get down there when people are sober and work with them at that point and work with the courts and help work with uh commitment processes.

That those are things police officers, we just we struggle.

That's where this is really kind of helpful.

So when we started this and the top 10 is not like a top 10, really what it was is the chief came to me and said, We got a problem, like help me out, like fix this.

So I looked at it and said, okay, it was we were having our numbers, our contacts.

It was like 30, 40 contacts per person of the highest ones.

And I said, okay, well, uh, how do you tackle a big problem?

Like how do you eat an elephant one bite at a time?

So that's really what I was.

I was trying to how do I narrow it down to a bite amount?

And I said, what if we just took the 10 people that are causing the most social harm at any given time and we focus on helping these people?

And that's where there's a lot of people.

If you've been downtown over years ago, you would have seen the same people every day over and over and over.

And that's what we were seeing.

And the chief said, What do you need?

I said, Chief, I need a missing link.

I need that social workers right there with us to help me navigate this that I can get that person, the social worker, to help make connections to which treatment facility might be right or which service might be right, or if get him connected to uh commitment, if possible, if that's the appropriate approach.

And that's where we got Terry involved, and our numbers started to go down and from 30 and 40 contacts per person.

We were very close one month.

I was really excited.

We almost had single digits as our top numbers.

So that's we have uh a full dance card here.

Uh so we have council member Palmer, Wall, Doring, Fredericks, Keene, and Mayor Norton.

So, council member Palmer.

I'll make it quick.

Thank you.

Just I got three things real quick.

Um, camping ordinance, I'm assuming is is working well, and we need to keep the camping ordinance going.

Um, number two, how are you working with the county?

I've always been critical that they haven't done much.

Um, I compliment the mayor because she got us to have a uh an evening shelter in the summertime where the county didn't want to do it.

Um, is the county stepping up and doing what they should be doing, or do we need more help from them?

I would say that we have since we have started working with this this kind of a model with Terry, our collaboration with the county and external providers has increased exponentially.

We are having success and other people are noticing that too, and they're getting in on some of that as well.

And so again, um, we're we're required, we're asking maybe social workers to handle things a little bit differently, to do things a little bit differently to maybe focus on outreach in the county is stepping up and and we're getting a lot of those resources um from them to be able to do so.

So that has increased going forward.

Um, with the increase of FTE for that position, I would it I would expect that we would have greater collaboration and we would have the ability to participate more with collaborative meetings, uh planning things, stuff like that.

That right now, there just isn't the time of the day for her to be able to do that stuff.

Councilmember Wall.

Uh I simply add my thanks to RPD for treating everybody with respect and compassion.

Thank you for all you do.

Absolutely.

Councilmember Doring.

Yeah, I I just have a few clarifying uh questions and a statement as well.

Uh, according to the AnyPath Home uh by name list, there's 300 individuals who are uh single adult individuals who are experiencing homelessness in Olmstead County with the vast majority of those uh living in the city of Rochester.

Um earlier on the presentation, you put uh 538 contact hours uh with individuals experiencing homelessness.

Wondering if you can tell me what percentage of those hours was allocated to the top 10.

Uh I can loop back with you and get that data.

I'd have to I'd have to buy forget that.

Okay, I I'd appreciate that because sometimes there's the perception that all of our homeless population is causing immense problems in this community, and that that reality is simply is not true.

That that is the top 10.

Okay, okay, yeah, thank you.

Okay, I would agree with you.

That is not accurate.

Yes, that all of them are by far and large, no, they're not.

Correct.

And I just want to get that narrative changed in the public sphere as well.

And then, Chief, you had you at the end of your statement, you talked about the impact of additional resources and what impact that could have on the community in terms of reaching people in this space.

I was wondering if you could unpack that statement for me a little bit.

Are you talking about the budget ask?

It was on that slide, or you had you had said something like we want to be more collaborative to fully understand the impact of additional resources allocated to serve this population.

Were you talking about additional service providers, additional capital expenditures?

Can you just elaborate on that a little bit more?

Sure, as you look at the different service providers, um, it's not just issues, concerns, problems are not just isolated to inside the four walls of those buildings.

Uh so whether you're talking about the landing, uh, the Salvation Army Catholic charities, uh, sometimes those issues spread out into the parking lots into for other neighborhoods.

Um, and uh I'll be flat honest with you, we have significant issues uh in and around, you know, the landing, the warming center, as there are people kind of funnel in there.

And so there's there's downline downstream issues that we that fall to us based on these service providers.

And I think that's where we need to start having some of those more collaborative conversations of how can we collectively deal with those issues outside those four walls.

Okay, thank you.

Councilmember Fredericks.

My mind goes right to solutions, of course.

And I'm sitting here thinking training two people while we have this rock star having them having her train the next two in line, so to speak, because obviously we can't do that.

Uh, a typical police officer probably can't do that.

We need her to train in her predecessors.

That that'll definitely be part of the, you know, if there's if this is funded, that'll definitely be part of the equation.

Is you know, how do we sustain this?

Yeah, heaven forbid we lose her, then we got this vacuum.

Our unicorns gone.

Councilmember Keene.

Yeah, thanks.

There's uh interesting stuff.

I I did want to go just you know, on the on the thank you uh educate, encourage, but on that enforcement are we using like the enforcement and on the camping ban?

I know I checked at one point a year or two into it, and we hadn't made arrests on that, but we're using it when you use enforcement.

I want to clarify what does that mean?

Does that mean arrests or what does it mean?

Let me jump at that.

I I think um you you are correct.

The the camping ordinance is working and significantly reduced the number of camps in this community, and and as the picture showed, it's reduced the size and scope and complexity of those because they're realizing that once we post those camps, they need to move.

And and that that ordinance gives us that authority to move and sweep those camps.

Uh, not dissimilar, quite frankly, if you've read any of the news recently, the city of St.

Paul is doing a major camp sweep uh uh in the in the near future.

And so having those rules, having those boundaries are absolutely essential.

Same with the Skyway uh ordinance that we talked about.

That has made significant difference.

That has made a significant difference.

And again, so we certainly do take the compassion approach, but we also need the rules and the boundary, otherwise uh people are less inclined to cooperate and uh and no, I agree, and again, I was able to support the camping band, but I want to understand.

I think when you use the word enforcement, maybe we're using it as what we're really we're having the authority to uh uh to to come to bear.

Right.

Or or does it really mean no?

We are re retaining, we're we're pertaining people and hope putting holding them for 24 hours.

Are we doing things like that?

Is that happening?

If there's criminal conduct, yes, we're certainly dealing with that.

We're we're taking appropriate law enforcement action.

Okay, but I don't think year to date we've or have we written a we no, that that was that ended up being dismissed.

There was some miscommunication on the understanding of the officer that wrote that.

Um so that that's been dismissed.

But I will add that we we have a lot of collaboration and communication that goes on with the city attorney's office regarding these individuals who were really needing to get some assistance.

And sometimes it is this person needs to be arrested so they can have some time to sit in jail, detox, whatever it is.

And Terry will have that conversation with the city attorney's office, and we've had a lot of success in doing it that way.

Okay.

So it's not necessarily just a decision we all of a sudden make.

It's kind of a collaborative decision.

No, I just want to understand that enforcement, and I think that I wanted to clarify that that I think enforcement doesn't mean arresting and going to court and things.

Those things I think we we know they're not gonna, they're there, that's just not the solution.

Um, I want to follow up on Councilmember Palmer a little bit with the county.

I expected to hear a little bit more about the AnyPath Home and the this new initiative.

And I know we're this is really an update from our police force about what we're doing, but I I think I I just want to clarify that this is like bringing these different groups together.

Um, I I don't know.

I'm I'm looking for it to bridge some of these problems with the things that happen around the landing because they're a part of this, or some of these other groups here.

Is that is that helping, or is it just a group that we try to inform what we're doing, or is it we it really is collaborative?

That's a complicated question.

Um so uh if you look at any path home as more of like a clearinghouse, right?

Of kind of like this is where everybody goes, and from there, people get dispersed into various different housing options.

So it exists, yes, and it is being successful, and it's great for tracking those numbers and for being able to show us out of that number, these are the people who are maybe homeless with families and they need to go into specific kind of housing.

That's what they're going to be doing.

Um, they're not necessarily going to be dealing with the people that we've highlighted here on a monthly basis.

They may know them, but these individuals might never rise to that point where they're going to be available to get any kind of housing through any path home.

Yeah.

No, and I I appreciate that everyone's in their lane.

And as the city side of this, we do have some of the enforcement and some of that like feet on the street.

So I appreciate that.

Councilmember Keene, I'm gonna allow council member Doring to fill in since he is our representative on any path.

I I would I would say that uh one of the interesting uh interactions with uh RPD and Any Path Home is in uh public spaces uh work group that's really working on addressing the effects that some of our more um uh some of our homeless population that requires more um effort.

Uh the the ramifications of their presence are having in our our public spaces.

So there's lots of discussions about how to clean up, how to how to light places so folks aren't congregating in places.

So there is there is some beginning work on and collaboration in that particular task force with any path home.

I don't know if that was what you were looking for.

No, no, I'm glad I think Councilmember Palmer touched on it of saying like we did do we have those those are those connections being made?

And I think the answer is yes.

And but like I said, we're still in our own lanes too.

I I don't expect this group to become, you know, to be reassigned into something else.

We have to stay in our lanes.

Um my my last comment is just on my you my admiration for, and I think some of this comes from leadership, but the it's amazing the touch some of the officers have in this because going through this in the skyway or in these other neighborhoods, it it really has to be difficult.

And I and I'm um I'm really impressed that the especially these younger guys can have that sort of outreach to people who need that at the time, but are not always treating our people with respect back to them.

So I think that reflects leadership, but also the character of the people we're hiring.

I I I couldn't agree more, and thank you very much.

I appreciate that comment.

We are very careful and selective and who we pick for the CAT team, and they have to have a true, genuine desire to want to help those individuals be successful.

Yeah, thank you.

Thank you.

Uh Mayor Norton.

So I think a lot has been said, but for those of you who were not here, when we started this path back in 2018, nine, nineteen, um, it was a very different looking situation.

We literally, those were easy pictures showing the housing in the skyways.

They were filled with people living in our skyways.

It was a very difficult time.

And it was new to the city, and um we didn't have any path home.

I'm so grateful that the county and that we have a representative here that's working on that because for people who are unhoused and they simply um have fallen on hard times, could be personal, could be financial, whatever.

Sometimes it's easier to, and we were from the very beginning finding more success getting some of those folks housed.

What we're talking about today today is kind of a different population of people who were resistant as the gentleman that was up there.

But sometimes you have to keep being there for someone until they're ready, which is one of the things I think that the police officers have done is being there.

There are folks who um have issues maybe so significant that finding housing is very nearly impossible until they're ready to get the help.

And this is what this has done.

You know, it's hard to hear the top 10 or whatever.

Sometimes I know I think that rubs some of us the wrong way.

Um, but they are the the 10 most challenging um persons experiencing homelessness who are are in legal trouble quite often.

Um that's who we're talking about here.

And and I really appreciated uh council member Keene's comments because having watched this evolve over the many years, I've been mayor.

Um that's who we're talking about here, and and I really appreciated uh council member Keene's comments because having watched this evolve over the many years, I've been mayor, it is night and day difference, and truly the compassionate folks that have been hired by RPD and that have been assigned to these uh roles have made a huge difference in the outcomes that we're seeing and why that group of 50, 80 people, I don't remember how many was something with the one at the end, have are no longer on the list who are able to get help, who are in chemical dependency treatments.

I've seen, you know, sometimes they finally are like, I'm ready today, right?

And then you're able to help get them where they need to go.

It is a night and day difference.

So um, it's been a challenging path, and and I felt um really fortunate to have what to have been a part of the change because literally at the beginning, it was anybody in the city deal with the homeless population.

No one at the county deal with the homeless population.

No one, no one was focusing on it.

No one and from that start to where we are now is a night and day difference, and we haven't solved the problem 100%.

I'm still waiting to find the community that has, but we're on a much better path.

And I think between any path home and the and the compassion that we're seeing um for our our toughest um folks experiencing homelessness is gonna continue to make a big difference, and thank you.

Appreciate it.

Thank you, Mayor.

And just uh one point that I wanted to add, taking off on uh what the mayor was talking about is also I want to commend you to uh on uh the work that you're doing across jurisdictions.

You were at Chief Franklin was at our OCJC earlier the last week and challenging.

We talked about Rule 20 uh uh cases, and just that there are a lot of challenges working with major health providers and the county, and really uh the chief is taking a lead on really building those partnerships and getting answers for these individuals who who are struggling, whether they're Rule 20 or close to rule 20.

And I one of the things that I really appreciate you uh sharing is that we've heard a lot about the top 10, and what you presented to us today was really showing how people it's not a stagnant top 10, it is people that are moving off of that, and that really says progress to me.

So uh thank you very much and uh keep up the good work.

Thank you.

And now I always put administrators elms on the spot.

No, she's got it up there.

That was the clerk.

Um thank you.

They know that I can I can't do it myself.

Um, so upcoming on the 27th, we mentioned the Shatio operating model and CIP update, and you also have RPU water and power supply plan update.

I also wanted to note on here if we can go to the next slide.

I'm hoping there is one.

Nope, there isn't.

That's okay.

Um, in your packet, there is the rest of the year of study sessions.

So I did just want to note that we are working on um getting an uh final sort of update and feedback from better public meetings, and so um if Mr.

Vlaho's is available on August 10th, we do have some time available on that meeting.

That might be um a good opportunity for him to be able to present.

Um, but we will check and see if he's available.

And then um, if you look forward in the year, one of the things that the group had has had talked about was using a fifth Monday, maybe twice a year, or at least trying it um to not have a study session, but to do a town hall, and one of the things we're talking about for your calendaring is potentially doing that on November 30th.

That is a fifth Monday, and so I realize not everyone might be available, it would be in a similar style.

You on the 9th of November, you oh sorry, something's popping up on my computer.

On the 9th of November, you are gonna have the feedback from the community survey.

And so, what we had talked about is having that be a town hall about the community survey.

So you'd have been presented the information during your study session earlier in the month.

You would also talk about how you might want to curate some of the the meeting.

We will need to find a meeting space probably before, two weeks before.

Um, but just wanted to uh share that for awareness that we're working on that.

All right, thank you.

And we are adjourned.