Okay, all right.

We will call the order, the Budget and Audit Committee meeting for Tuesday, March 25, 2025.

We want to welcome you all to the chambers this morning and when we start by calling the role to establish a quorum.

Thank you, Councilmember Telemontes, Councilmember Maple, Councilmember Gatta and Chair Dickinson.

Here. We have a quorum.

May I pro-tem Gatta? Would you please just send a random acknowledgement in the press?

Please join us.

Please rise for the opening announcements and honor of Sacramento's Indigenous people and tribal lands to the original people of this land.

The Nesanon people, the southern Maidu, the Valley and Plains Mewok, the Puttwin and Wintun people.

And the people of the Wilton Ranch Rhea, Sacramento's only federally recognized tribe.

May we acknowledge and honor the native people who came before us and still walk beside us today on these ancestral lands by choosing to gather together today in the active practice of acknowledgement.

And appreciation of Sacramento's Indigenous people's history, contribution and lives.

Face flag salute pledge.

I pledge allegiance to the flag of the United States of America and to the Republic for which it stands.

One nation under God, indivisible with liberty and justice for all.

Thank you for that.

And just a reminder, many of you who want to speak have filled out speaker forms.

But if you haven't done so and there's an item on the agenda today that you want to address.

The committee on please be sure to fill out a speaker form and bring that down to the clerk so we can get you in line for the item in which you are interested.

And then I think we can take the consent calendar.

Do you have two speakers on item number two may I take those now?

Okay, let's do that.

Thank you.

Leah Morris and Stacey Hayes both on item two.

Good morning.

My name is Stacey Hayes and I'm going to read aloud a letter that we're submitting to the council.

Dear Mayor McCarthy and City Councilman, we are willing, I'm sorry, we are writing to you to express our support.

I'm going to give you a hand for the shelter budget motion put forth by the city's animal well-being commission to allocate funds for needed renovations at the city of Sacramento's front street shelter and to begin the search for a new shelter site.

As partners of front street, friends of front street shelter is deeply invested and supportive of the vital work carried out by the shelter staff and volunteers.

Animal care services survey conducted by the city along with the National Research Center incorporated in the summer of 21 also concluded that this value is shared by the residents of our city.

Only safety and openness and acceptance of all residents were given a higher priority of need by the city's residents than animal services.

However, the 2024 shelter needs assessment made clear that the existing facility is not capable of meeting the needs of the community.

As economic strain and the rising cost of veterinary care result in increasing community need for services, the shelters in adequate facility and resources contribute to a cycle of crisis response for the shelter staff who are then unable to effectively serve the community.

The vital work of the staff and volunteers perform that they perform is already challenging but performing this work in a crowded environment using outdated equipment while also managing safety risk adds additional difficulty and adversely affects the efforts of the dedicated and compassionate individuals who provide the essential services on a daily basis.

Any action taken by the city to support the initiative will not only benefit the animals receiving services at the shelter and the dedicated individuals contributing their time and skill to its operation.

Thank you for your comments. Your time is complete.

Our next speaker is Leah Morris.

Stacy, we do have the letter and if Leah wants to finish that last paragraph, maybe she can use a couple of her seconds to do that.

Oh, it's the, you've got the letter.

We've got the letter.

Thank you.

Okay. Thanks.

Good morning.

Good morning.

Thank you, I'm Leah Morris, the vice chair now of the Animal Wellbeing Commission.

I want to thank all of you for talking with us and reviewing the needs assessment that we presented.

We are just here to reinforce the request that we initiate a site selection process for a new animal shelter location.

I know that this is tough budget times.

We understand completely that you have many challenges ahead of you regarding the budget.

If we could initiate a site selection process in line with the site selection criteria that was outlined in the needs assessment, that would be a tremendous ask,

and a tremendous opportunity for us to move forward with this work.

So again, we appreciate the time you've given each of us and we appreciate your engagement with the city shelter.

Thank you so much.

Thank you, thank you both.

This is a receiving file for us so we can't take any direction.

But I'm sure this will be a topic of conversation as we go forward with the budget process somewhere along the line.

So thanks both.

Do we have any members of the committee who have comments or questions on the consent items?

We do.

Thank you, Mr. Chair.

One more direction here for our city interim city manager.

And one, and I have met with some members of our commission and I appreciate the information here, particularly of urgency.

I think there are some capital improvement issues related to the kennels and the gates and the guillotine doors.

That in the past we've had volunteers who've been injured because of those.

So I think some of those are some immediate things that we need to resolve that are within the purview of the authority of the city manager.

And I do would like to have a follow up to make sure that we start that process.

I'm looking what our overall facilities needs are.

But the safety issues that are apparent now I think are essential.

So with that, I think we have a motion that council member Maple may put the direction on this, particularly with what has been identified in those issues is critical for immediate action.

Thank you.

I want to let you know, sorry, we need microphone.

We've already been talking about how we can accomplish some of the urgent safety needs in the current fiscal year.

So that's something we're already working on.

Thanks.

Thank you, Chair.

I just want to align myself with Mr. Geras comments.

I was able to meet with several members of the commission, including an artistic five commissioner.

And they have some specific recommendations that they shared with me and I'm sure with others about how we can do.

Some of the immediate needs sounds like our interim city managers are working on this, but just wanted to.

So I'll move the consent calendar and just with the Eric's direction and agree that this is this is urgent.

I know that it's going to take some time for us to be able to identify any location and get the funding that we need.

I know that there are several strategies that could be in play to do that, including a capital campaign and others.

But I think there's definitely several things we can do in the short term to make it safer.

So thank you.

Thank you, Council Member.

Second from Mr. Geras.

On the consent items and to the extent that we can, the motion includes further action to be brought to the council with respect to items with the shelter.

I'm sorry.

I'm sorry.

I am number one on the.

You're number one on the hit parade picture.

Your name is.

I am.

You're invisible.

I'm invisible today.

I also just want to thank the commission for being here and all your advocacy for our four-legged friends and all the hours and time that you spend into this and to protecting them.

Also, the friends, the front street animal shelter who are fundraising arm of it.

I think it's time for us as the city, front street, the friends and the commission to collectively work together to better get more resources, more funding and be able to achieve our mission of taking care of our four-legged friends.

So thank you for all the work that you know.

Okay. Thank you for the comments.

If there are no further comments or questions, we have a motion by Council Member Maple, seconded by Council Member Aguera.

All in favor signify by saying aye.

Aye.

Opposed say no.

Any abstentions?

Hearing none, motion carries.

Thanks very much.

On to the next item.

We're down to three, huh?

Item three. Do you want to read that one?

Sure. I don't read it.

Pardon me. Item three is the city auditor's proposed work plan for fiscal year 2025-26.

Okay. Thanks. Good morning.

Good morning, Chair Dickinson and members of the Budget and Audit Committee.

I'm for a stirrari, the city auditor.

The recommendation that is before you today is to pass a motion, approving the city auditor's fiscal year 25-26 work plan, and forwarding to the city council for final approval.

The office of the city auditor plays a vital role in ensuring public accountability and transparency in municipal operations.

The recommendation is to provide a catalyst for improvements of municipal operations, promote credible, efficient, effective, equitable, fair, focused, transparent, and fully accountable city government.

As an independent body, the office provides objective and reliable assessments of the city's ability to achieve its goals and maintain an effective system of internal controls.

This has three divisions focused on our main areas of work, performance audits, research and analysis, and the whistleblower hotline.

To develop my work plan this year, I met with city leadership, including city managers office and department directors, and conducted a citywide risk assessment that reviewed various available data to identify areas of highest risk in the city.

I wanted to focus my upcoming work plan on projects that could identify efficiencies, cost savings, or potential revenue increases.

As I reported last year, our office has dealt with some vacancies during this fiscal year, which has limited our ability to complete our anticipated projects.

We've been working on filling our vacancies and are now down to one vacant position, the principal fiscal policy analyst position that manages and oversees our performance audits division.

We have been working on completing our existing audits and anticipating quite a few before the end of this fiscal year.

However, as you know, freezing the principal position is one of the strategies on the table for balancing the fiscal year 26 budget.

If that strategy is selected by the city council, it would impact the proposed work plan that I have today.

In our performance audit division, we currently have six audits and progress, including a couple that have been on hold as we work to staff of the department.

We anticipate four of these projects will be completed prior to the end of the fiscal year.

Those are the audit of the emergency medical services, part one of the homeless response audit, audit of the military equipment, use policies, and inventory practices, and the audit of the animal care service.

We will resume the evidence and property division audit once the military equipment audit is completed.

For our planned audits, we have a second homeless response audit that will bring back to the council for deliberation when we complete the first audit.

We want to ensure that the second project focuses on the council's highest priority homelessness issues.

For our planned audits, we have a pedestrian safety audit that was rolled over from our prior year work plan.

We have added three additional projects for the upcoming work plan, and those are the audit of the code compliance night team, the city radio systems, and the special event permitting process.

I selected these projects as I believe there are some efficiencies and cost savings that the city can realize in these areas.

As I previously mentioned, we had a couple of audits on hold.

I'd like to get some guidance on the council's prioritization of either resuming the complaint investigation and resolution practices audit or initiating the audit of pedestrian safety after we complete some of these projects.

In September of last year, we were able to finally fill the cannabis auditor vacancy in our office.

As we discussed last year, the cannabis auditor position has been reduced to a half and FTE working on cannabis, and then the other half assisting with other projects, including the offices measure L work.

The first few months of the cannabis auditor's work was spent on the Charter-Mandated Children's Fund, based on funding verification report.

We've now begun our ongoing monitoring of a variety of cannabis-related activities, and I also want to point out that up there it says that the Seaball audit for the Children's Fund is in progress, but it's actually supposed to be down in the planned audits.

So I'll get that fixed before we come back to the city council.

In our discussions with the city manager and the cannabis office, we identified a project that could potentially help streamline the permitting and regulating of cannabis businesses.

So this project would compare the cannabis laws governing cannabis businesses by the state and the city to identify any regulatory overlap in code provisions, enforcement mechanisms, and administrative activities.

This would identify opportunities to streamline the city's cannabis regulation.

We believe that this project should be the next cannabis project for us to conduct and have listed it before the illegal cannabis cultivation audit that was rolled over from prior work plan.

Our office also has a designated utilities auditor that's funded by the three utilities funds.

We're currently working on audit on an audit of the department's energy use that will evaluate the feasibility of DOU operations moving to 100% electric vehicles.

And then other audits that we have planned and special projects are a series of audits regarding physical security and then another storm drainage fund review that was requested by the Department of Utilities.

Next we move to the research and analysis work plan.

We anticipate completing the audit of the ethics commission next month.

In addition, due to staffing turnover, we had to put the audit of the transient occupancy tax on hold last year.

We were able to fill that vacancy in this division in January, and so we've resumed that work on that project.

In addition, we started a project to explore entering into contingency contracts with the vendor to conduct audits to recover potential past taxes or other revenue owed to the city that were not properly attributed or paid to the city.

We're currently working with city staff, including the city attorney's office to determine whether that project is possible.

And then we also have added a project of business operations tax to evaluate the city's BOT and benchmark with other cities to identify any areas to consider updating.

Then our research analysis side, we have a number of recurring reports planned.

Measure L, mandates are office to annually verify that the baseline funding amount, which we calculated in December 2023, for the Sacramento Children's Fund was expended in each previous fiscal year.

In addition, last year the council approved changing the frequency of the community survey from being done annually to a biannual survey.

We did not conduct the survey this fiscal year, but we are due to conduct one in fiscal year 26.

However, this is also one of the budget reduction strategies for fiscal year 26.

And if council selects this strategy to balance the budget, that we will not conduct that project.

And then we also have a couple of our diverse city projects that we rotate each year.

Finally, our office also operates the Wissable Hotline.

As of January 1st, 2025, we had 23 tips open and we anticipate receiving about 160 tips this fiscal year.

This is an increase from our prior years estimate of 140 tips as we have increased experience and increase in the number of tips.

This increase in the Wissable Hotline activity does reduce our staff time available to conduct our other audits and projects as we don't have dedicated staff for the Wissable Hotline and all office staff take on cases.

And this last page discusses our selection process for our work plan and our office's authority.

This concludes my presentation and I'm available to answer any questions you may have.

Thanks for the presentation. I just wanted you were asking for a particular guidance on the complaint investigation on it and one other.

Yeah, the pedestrian safety if I can get some guidance on which one to start next as we do have resources available that would be helpful.

Okay, thanks. Okay. Let's take those who want to speak first before we go to the council members.

And so we have thank you. We'll take public comment first.

I have three speakers. The first is Lambert, then Mac Worthy and Keon Bliss.

As a native of Sacramento, I study City Hall very well.

And any time that I hear anything about cannabis or children's funds or whistleblower, you can best believe I'll be here. I'll start off with cannabis.

There's actually an office in one of the divisions in City Hall. There's five divisions here.

There should be no controversy on how to deal with cannabis unless it's intentional.

What do I mean by that? It is a very high-text industry and you take that tax money and put it into the children's fund.

If you have money going to help them for food, travel and lodging, the auditor should look into that.

Very few teenagers are traveling all over the world and I have to send a shout out to Megan because I see her in here from arts and cultures.

She's an icon in Del Paso Heights. Why? Because the high school appreciates her efforts. That's one department that she received money.

Regardless of a structural deficit which is a peculiar phrase to me. That is another term for mismanagement.

I never have heard of structural deficit. I've heard of deficit but not structural. And it's all over the state of California. They're using that phrase.

There's a new regime now and they're going to evaluate that phrase. A lot of people are going to...

Thank you for your comments. Your time is complete. Our next speaker is Mac Worthy. Then, Keon Bliss.

Good morning, Councilor. How are you using the word Audit?

You're using that word from what I figure here is to plan workshop. Work.

Audit should be used at the federal government. Use it. How much money is it going to cost to do those jobs? That should be your position.

If you are pure seven on 25, what in the hell are we doing? What 26 are tied to it now? Somebody, you know what, accounting me.

We need some experts to get in here and show you what accounting and how to use it instead of saying audit.

Get your head on cross and get out of the way. You got a bike here that you only got one sign for running a red light and that's on 20th of the street.

That's the reason bikes people get killed here. Talk to them as they children because they don't understand right a bike facing the traffic, not traffic behind you.

And you looking at the driver and the driver looking at you. But behind you, the driver of you and you outside of your mirror.

Thank you for your comments. Key on bliss.

Hi there, a bunch of nodding committee.

I'm here to request for this council and for the city auditors office to include in addition to the work plan and an independent audit of the Sacramento Police Department's overtime policies, practices and expenditures.

And especially given the city's projected budget deficit, it is crucial that the council take immediate action on this audit based on the annual report and work that was done by the community.

Please review commission in 2024 and was approved by the personnel and public employees committee.

Just a few of them, just a few of the most concerning observations that we learn when we studied the police department's budget management and strategic planning priorities.

Since 2011, the city has paid a staggering $158 million in overtime for the police department with at least 81% of this amount being accrued after 2016.

And in 23 alone, police overtime pay reached $23 million for the calendar year, which was a 10-fold increase since 2011.

And the top overtime expenditures according to fiscal year 2324 report that was included at budget hearings last summer.

The number one spending prior to the number one overtime expenditure was the back filling the complaint desk by $1.1 million, court appearance time by $779,000 and the impact teams by $738,000.

The other observation we noted was that over 60 Sacramento Police Department employees reported overtime pay exceeding 70% or even 100% of their base salary.

Despite staffing shortages, an estimated 70% of those employees appeared under utilized receiving little to no overtime pay.

While 13 sworn police officers and sergeants have somehow managed to double their base salary through overtime for at least two consecutive years.

Thank you for your comments, your time is complete.

Thank you for your comments, your time is complete.

Thank you. Thanks for the comments. That's something I'm sure we'll be discussed.

That completes the public comment on this item of council member Gatta.

Thank you very much, Chairman.

And I wanted to thank our city auditor here for a great work again and all of the issues.

And I understand we've discussed over and over again how many audits we want to do, the limited staffing that we do have.

And I'm still always impressed about how much we actually get done and the cost savings that result from this auto work.

So first of all, let me commend you and your team on that effort.

Number one, I think, you know, one I would like to on the on the issues of prioritizing, making sure that we compare the cannabis code analysis and making sure that we look at what the state is doing and what we're doing.

Accomplishing that audit and making and then coming back to us, I'm not suggesting that we eliminate the illegal cannabis cultivation, but I believe that audit will inform us on what to do with that following audit and whether it needs to continue or not.

So I know sometimes you'll do it concurrently, but that's one direction that I will provide on that.

And I believe that'll give us a better understanding on what to do there.

As far as the issue on where to prioritize here, my direction and my motion would be to finish what we started and that is in the complaint investigation and resolution process.

This came about from employees who felt that there had been discrimination, workplace harassment.

And so and whether the city was listening or following through with that complete resolution process.

So I would move that we move this item, Mr. Chair, with the direction that we advance the complaint investigation resolution process.

And also because when we look at the whistleblower investigation hotline, the number two by far issue is in under employee relations.

And so I think that's a signal from our employees that they want us to see that we're responding to those issues.

I want to make sure that our employees feel that there is a resolution process when they feel that things are happening within the city.

So I'll move that item. I don't know where my colleagues land on this, but I know we've been working a lot on this and I think it's time to finish this audit and then figure out what the next steps are.

Is there a second to the motion?

All right, we have a second.

And then council member, Telemontes, Vice Mayor?

So I agree with Mayor Pro Temgara that we need to finish all the audits that you currently haven't progress.

They're all expected to finish close this year. So keep up the good work.

In addition, once you have capacity with your staff, my priorities are continued to be homelessness and the audit of that so that we don't have to continue spending money and I mean, we need to see results and we need to see where we can do better.

In addition, the pedestrian safety, I know we have a declaration of it and council member Maple has been leading that.

And so that's second and then the animal wellbeing.

We're getting a lot of concern from the community about our practices there at the shelter and with the budget deficit and the ask from the animal wellbeing commission that we just adopted.

I think it's important to see how we can be more efficient.

And then congratulations to your Assistant City Manager, Kevin Christensen, on his, uh, Christensen.

Assistant City Auditor.

Assistant City Auditor on his, uh, promotion.

And then I know for the budget, you put up one of the vacancies that you have for budget reductions.

And so I want to make sure that this work gets completed. So for myself, please take that out from your strategies.

Okay.

That might be the next item.

That's it.

Council member Maple.

Thank you, Chair.

And I just want to, I'll be really brief because my colleagues said, said everything I wanted to say.

I just wanted to know how robust your work plan is.

And I hope the public sees just how much work has done by you and your office every year, not just, you know, the one off the things that we see up here.

We're like, oh, yeah, you know, we've got this great idea or we think this thing is really important that happens all throughout the year.

But also, you know, things that happen all the time, right?

Everything from the cannabis stuff that is, you know, baked into the charter and the code about what we have to do, you know, to the ongoing things related to homelessness.

And so it's just, it's a lot.

And I know that you're working and doing a lot.

And obviously we have decisions to make later on at other hearings about what we're going to do in terms of our budget strategies.

But I definitely keep that top of mind because I see your position in this office and the city as one of the most important things that we do, which is about transparency and public trust.

It's showing that we're taking a deep look at what we're doing all the time.

And we're being honest, transparent about the things that we're not doing well and finding ways that we can improve them.

And that's a big part of what you do. So I'm just really grateful for that.

And I'll be supporting the much on the floor. Thank you.

Thank you for those comments.

And I share the sentiments that have been expressed by the other members of the committee.

I would say that capacity, not even not with standing potential reductions that could occur in the course of the budget deliberations, the capacitive your office seems to me to be challenging in the sense of trying to accomplish all this all this work.

And obviously the others have much more experience with this and it appears your office is quite capable of producing a significant amount of work.

And that's to be applauded.

But I also wonder whether we are creating some both expectations and demands on your staff that are not necessarily realistic.

And in particular some of the continuous work.

Now we did take action to reduce on the measure L monitoring to a slightly lower level in the off year so to speak.

But as one I would encourage looking at your work program to see if there are other things where perhaps we can lighten the load a little bit to make sure that you have the ability to get done.

And in a timely way the things that are in your work plan.

So that's not necessarily an issue for today but perhaps over the coming weeks it's something for you to end for us frankly to think about.

Beyond that I do agree with comments that have been made as I indicated and appreciate the work that your office and your staff do each and every day to serve the city and the citizens of the city.

So with that if there aren't other comments or questions we have a motion on the floor to accept the audit program as proposed and emphasize give priority to the complaint investigation audit between that and the pedestrian safety audit if I understand the motion correctly.

Okay all right if there's nothing further all in favor signify by saying aye.

Aye.

Post say no. Any abstentions hearing none the motion carries.

Thank you.

Thanks very much.

Next item.

Next item is item 4 fiscal year 2023 24 risk management annual report.

Good morning.

Good morning.

Members of the budget on the committee. My name is Pat Flairty.

Risk manager for the risk management division of the HR department.

Today we have the fiscal 23 24 risk management annual report for your review and discussion.

I'd be happy to answer any questions you may have regarding the report.

Additionally we thought this was a great time to provide the committee with information regarding the increase in insurance costs.

The city and public entities in California and nationwide have been experiencing.

So we have two guest speakers or experts in the area.

We have Rick brush.

Where you guys.

Here.

Rick brush who is the chief member services officer at prism and that's the JPA where the city buys our access liability and workers compensation insurance.

We also have Kevin Bibler who was the senior vice president at a lion insurance services.

And a lion is the broker for both the city and the lead broker for prism as well.

So with that I will turn it over to our guest speakers.

All right.

Thank you.

Welcome.

And we do have a busy agenda.

So we have brevity as a virtue.

Well understood.

Thank you so much.

Thank you for the time on the agenda.

I would like to thank you for your service.

My name is Rick brush.

I'm the chief member services officer of prism.

Prism is a joint powers authority.

So a joint powers authority is one group of public entities come together as you know.

You are a part of that.

We are you.

This is who we are.

We are actually the largest.

I should stop momentarily.

Do you have a copy of the presentation?

We don't.

Please hold.

Thank you so much.

Thank you so much.

I'm sorry for that.

There are.

I'm trying to be expedient.

There are.

Is a tremendous amount of information in here.

And I think truly you being able to view that at the same time as listening and will help the process.

Hopefully we just want to be able to tell the story today truly.

Joint powers authority is prism.

We were formed back in 1979.

Prism is actually the largest joint powers authority in the nation at providing coverage programs to public entities.

So our size and you will see on these screens we have 2.3 billion dollars in contributions.

We are the size of a medium size insurance company.

And we do this with the staff of only 110 people.

So we are incredibly efficient.

What the reason size matters is we are going out to the reinsurance markets and leveraging.

Not only the size of our group, which you will see on the slides, we have about 70% of the cities in California.

We have 54 of the counties.

We have 10% of the school districts.

So the size that we represent when we are going out to the reinsurance markets give us tremendous leverage.

The other thing that does is we are a very diversified group.

Because of the different types of public entities that we are made up of.

No reinsurance is scared about a certain risk that we have at hand.

We have a diversification of risk with our in our portfolio, which is very important to the members.

What that also does is it provides stability and rates.

And it provides better pricing.

It provides better insurance coverage.

And all of these things together gets you a better product at a better price.

That's the bottom line.

So in risk sharing, what is it that we are doing?

We aren't traditional insurance.

You are a part of a coverage program.

And what these coverage programs do is basically this.

We pull money, not me promise.

We pull money for the payment of claims.

We also purchase reinsurance because we pull insurance up to a certain point.

And then we buy reinsurance over the top of that.

Mr. Billers is going to speak to a little bit of that as well.

The other thing that we do is we bring together those economies of scale to help you manage your risk.

So we work with Pat.

We work with Shunil.

And thank you so much for having members of your staff that are participating as members of prism on our committee because we cannot do this work without you.

Overall, we have 150 individual employees of members of prism that sit on our various committees that set forth the strategy to manage the risk and to manage all of those coverage items.

The other things that we do is we have cost drivers that are in place.

So what we are constantly doing is making sure that the rates that we charge are equitable to all members.

And by that I don't mean we charge them the same amount.

I mean we have fair, equitable pricing.

What we do is for members that are doing a great job of managing their risk.

We have credits in place for those that aren't doing a great job.

We have surcharges and the surcharges that are going against those that aren't paying attention to risk like you do.

Get spread to out the people that are managing the risk and doing a great job there.

So there are a lot of variables that go into this.

But today truly what we wanted to talk about are specifics to your workers compensation and your general liability programs and what's going on in the market.

So I've tried to be brief.

I'm going to hand over to Kevin Billler.

All right, thank you.

All right, good morning. Thank you.

I'm going to talk a little bit about the market.

Many of you probably have heard that the insurance market has been very, very challenging of late.

And that certainly continues to be true and is a main reason why costs continue to escalate.

I'm going to start with the workers compensation because that is relatively good news.

That market has been fairly stable.

We have not seen huge increases in numbers of claims.

So the claim rates are staying fairly steady.

However, the severity of the claims and I'm talking overall does continue to inch up and that's something that carriers and underwriters are keeping an eye on.

A couple of reasons for that.

Medical technology is creating accident survivability.

So more of our injured workers are surviving, which is a great thing.

It also means it's more expensive.

The cost of the technology, the cost of pay benefits for folks continues to go up.

There's also an increased life expectancy for injured and ill workers.

And so again, from a human standpoint, very, very good news.

From a fiscal standpoint, it does increase the cost.

As well, home health and skilled nursing facilities.

Those costs are much, much higher than normal medical inflation.

So the cost to provide benefits is just higher and that's where we see some concern out in the market.

I'm now on slide number seven.

And this is some benchmarking data.

So this is comparing the city and your loss experience to the other high safety members in prison.

And high safety is defined as anybody who has safety payroll that's more than 40% of the overall payroll.

So police and fire.

What this is showing, you folks are along the top of those dials compared to the rest of the group along the bottom.

Your average cost per claim is half of the comparison group.

So you're doing an outstanding job in controlling the costs of the claims.

Your frequency, which is the one all the way to the right, is a little bit higher, just slightly higher than the average.

But your loss rate, so that's the dollar of loss paid per thousand dollars of payroll, is considerably lower than the comparison group at three dollars versus five dollars and 50 cents.

So whatever you're doing to control costs, great job.

Please keep it up.

And if we can get the frequency, the number of actual claims that are happening down, that would be even better.

So I went through work on very quickly because it's the liability side, the general liability where the costs have been increasing dramatically.

The market is terribly hard out there for general liability and it really is a societal issue.

We have seen a very steady 10, 11, 12% increase across the board in actual claims over the last 10 to 12 years.

Something changed fundamentally in about 2013, 2013, 2014, where claims that used to resolve for three to five million dollars now have the potential to resolve for 15 to 20 million.

So the economics of it just changed dramatically.

Turning the page over to slide number nine.

The two main drivers, this is what we would call social inflation.

Social inflation is defined as when the cost of insurance claims exceeds the cost of normal inflation.

And it certainly has done that over the last decade. There's a lot of different reason for those that will go through some of those.

The other is nuclear verdicts.

Technically a nuclear verdict is any verdict that exceeds $10 million.

And unfortunately, where those used to be an anomaly, we're seeing a more and more often across the board these days.

The little graph there on the bottom right hand corner shows that where prior to COVID, a $20 million verdict in the United States, we'd see about a hundred of them, 95 to 100 a year.

Since COVID, that number is more than doubled to 200 to 225 $20 million claims each year.

That's not the city. That's not even California. That's across the country.

But it still drives the cost that the carriers are charging.

The next slide talks about litigation funding. This is a little known situation that's going on where third parties actually invest in a claim.

So they fund the claimant, they put millions of dollars into the defense of a claim, or excuse me, the plaint side.

And they make out very well if they win. They collect 30 to 40% of the verdict if they win, leaving very little for the actual injured person.

So this is something that's almost entirely unregulated. They do not even have to disclose. In fact, they can't disclose to the jury that it is in play.

So it's having a terrible impact in something that we really need to focus on.

Quick question. Is there any legislation to fix that right now?

Yeah, there is. There's some legislation in California legislature. It did not go anywhere last year. It's been brought back this year.

There are a couple of states who have made it such that they are able to tell the juries in deliberation that this is a litigation financing situation.

It's a big deal. It's a multi-billion dollar industry. It's very frustrating.

The other big thing that drives this is the plaintiffs bar. The plaintiffs bar is very, very good. And they're also very cohesive.

What works for one attorney, plaintiff attorney, is going to help another plaintiff attorney. And every time they get a bigger award, that means that the next time they bring in case, it's more likely that they're going to get a bigger award.

So, high tides rise all ships in that scenario. They also spend a tremendous amount of money advertising.

So if you drive around on the freeways and you see the billboards, or you look on late night TV, three and a half billion dollars was spent in 2023 on plaintiff advertising.

So they're good at it. They're getting the word out. They're finding the cases and it's driving up the cost.

So that's kind of a quick overview of what's driving things on the liability side.

If you look at slide number 12, we again look at benchmarking. This is the city of Sacramento against the other cities within the liability program that you participate in.

It shows that your average cost of claim in this coverage is a little bit higher than the average, 25,000 per versus 23.

Your frequency, ironically, is much better. So you have a frequency rate of 1.37 versus 1.85, but the cost of the claims that you're having are higher than that control group.

Which means that if we can keep the frequency low and control the cost somehow, then we can reduce the cost of your claims overall.

I know I went through that really quickly. I'm going to turn it back over to Rick to talk about what prism is doing about these escalating costs.

But if there's any other question, I can answer please. Thank you. Thank you.

So when you hear all that, the natural question is, okay, so what are we doing about it, right? And that is what our members are focusing on all the time.

In our underwriting department, what we're doing is making sure that the cost allocations are done equitably, as I said before.

The other thing we're doing is we're constantly looking at our memorandum of coverage. Remember, this is driven by the members.

So we aren't trying to exclude coverage. The members are constantly saying, what is it that we should be covering?

So the underwriting committee does a tremendous amount of work. We aren't an insurance product. We aren't an ivory tower.

The money that we can save staves within the program. So our underwriting committee continually is saying, what is it that we should be charging?

What's the risk margin that we should put in place to make sure that we have enough money to pay for all of these escalating claims?

The other thing we're doing is I'm pointing out the word claims quite a bit. We have 17 people on our works compensation claim staff.

And we have 11 people on our general liability claim staff that all day, every day are helping members in managing claims.

They aren't doing the work. They are supervising. They are providing expertise and they're helping you to say, what are the strategies that we should do based on these claims to get the best resolution for the city?

The other thing that we do is we have a data and analytics team. The information that Kevin provided you in those kind of radial dials in the benchmark comparisons.

We have an in-house team of six people that are putting together all the data and analytics work. So that our risk control team, as I talked about Charneal working with member services and risk control, can say, what are the trends that are coming down so that we can put together services, resources and programs to best help you manage that risk?

The other thing that we're doing is Kevin touched upon this and thank you very much for your question of what are we doing in the legislature.

We have a legislative committee. We work with a group called Kajapa, which is an association of all of the JPAs in the state, with which there are about 120.

We're working with them to say what is the messaging that we can do to provide information over at the capital in terms of putting together torque caps or bringing forth these scenarios in the courtroom so that we can say, members of the jury, this is what you're hearing right now and this is why and this is what we should be able to disclose.

One of the things that we also do is we try and offset all of these things with investment income.

So Prism started a captive insurance company back in 2016. You can see the numbers on that next to last slide in terms of the things that we're doing and the performance that we've had to help offset the expenses as the expenses rises.

All I want to say is we have a goal of to have over 8% and since 2016, we've reached over 9% in terms of the aggregate. So that is great performance that we've done on the investment side of the house.

The other things, what can the city do? So the city can stay current. You are doing a great job of that with the staff that you have in place.

Also vigorously defend the claims that we have a good payout pattern on because if we continue to settle claims as the numbers go up and up and up, we aren't helping ourselves.

We need to get out there and say these are defensible claims and I will tell you that especially when the area of law enforcement where we used to have a huge problem, we have a lot of cities and counties right now that are getting favorable furtics because we're able to show fact patterns in place with data to say this is not on us.

So those are some of the things that we're doing. Kevin, I think you got one or two final comments.

Yeah, just very, very quickly. We already talked about the legislative change to the extent that we can all support that. There are some good things that are happening and that can make a big difference.

You could also potentially consider purchasing more limits. The claims are getting out of control. You already buy $40 million in limits in liability but we're seeing $40 plus million claim.

So I know probably not in this budget cycle or in this budget environment but it is something to keep an eye on.

And then lastly, we should all be educating the public. The public does not know when they sit on a jury and they give away $27 million that it's not being born by the insurance industry.

I mean indirectly it is but it comes back to the public energy. It comes back to the taxpayers in increased insurance costs and risk costs going forward.

So to the extent we can get that word out, that should help as well. With that, we thank you for your time and be happy to answer any questions you might have.

Well, thank you for the present presentation and this could be a much longer discussion.

Yes. Then we have time for. But I wanted, if I may, to focus in on a couple of years, what can the city do items?

The first one is consider assuming more risk and so can one or all of you elaborate on what we are doing as a city to look at different self-insured retention levels and what that would mean for premium costs and other considerations.

That's a complicated analysis so we're having our actuary work on that for us and give us, they can also I think go back in time and say how do you assume more risk the last five years, what would the results have been.

And also tell us going forward if we assume more risk is that going to be beneficial or not. Now if you assume more risk, get the form of money away into the budget to cover those costs, right?

So it does get pretty complex but we are having an actuary work on that and that should be ready for our renewal in a couple of months that we can use that to figure out if it's amputated to change our retention or not.

Well, I appreciate that and I'll look forward to it. I didn't see in the report and I thought I might.

And if I missed it, please let me know what the city actually paid out in terms of self-insured retention, separate from insurance premiums across the spectrum of insurance lines is roughly 70 million.

Do you know what the city paid out in self-insured retention in the last year?

Right. So what we normally do in this way, why? Sometimes it's difficult because claims occur three, four years ago and that's when the pay was not for three or four years.

So we try and go by the actuary's numbers which takes in consideration what's been paid and what you reserves are, what we think you're going to pay.

And we tend to focus on the actuary's numbers and those are in the report what they're estimating our total costs are going to be based on paid and what the open claims are and so forth.

Okay. I didn't see that in numbers but if you don't need to necessarily cite it now but if you can just shoot me an email or...

I'd be happy to.

So, on page 16 of the...

Okay.

And in report that's for auto. We have one for... That's for general I believe we have one for auto and one for workers compensation as well.

Okay.

That's the actuary's best guess at this given time what the overall costs are going to be for claims that occurred in that fiscal year.

And then you said in the coming months that there'll be a further conversation about whether it makes sense to adjust the self insured retention or not.

Okay.

This... The second thing that I wanted to ask about particularly with supporting legislative changes that are beneficial to defendants and I understand that...

That desire on the one hand but you know the point is ultimately to fairly compensate people who are injured.

And obviously we want to do that in a way that is also in the best interest of the city but...

I don't want someone to walk away from this exchange and your presentation thinking what we want to do is stack the deck so that people who have been injured aren't appropriate leaf and fairly compensated if they're injured and it's at the fault of someone or something to do with the city.

So I just hope that as your committee works on legislative changes and as we think about as a city what we choose to support legislative that we keep that objective in mind.

And then I just a quick comment about educating the public or point of course is well taken but I also don't think we want to prejudice people against those who make claims on the basis that you know what if it was if it was going to be paid for by Ford Motor Company it's okay open the wallet but if it's going to be paid for by the city or the county of Sacramento or any other public agency.

Whoops don't compensate people fairly because it's coming ultimately from insurance companies coming back to the public jurisdiction.

So I think education is absolutely essential but it's also delicate from from my perspective so council member telemante's.

I just wanted to thank you guys for making this so that people can understand it.

There's a very thorough presentation very quick presentation and I agree with your comments council member I think it can't lose sight of what these claims are meant to do.

I don't think we have any other comments or questions this morning for you thanks.

This is a receiving file so I don't think we need a motion for that do we.

Oh I'm sorry we have speakers thanks.

Thank you.

I have two speakers Lambert and Macworthy.

As a business owner I really appreciate what you just said Mr. Dickerson because when there's a liability people should be compensated.

You have you you pay premiums I do I own a business you pay premiums if something goes wrong with that cheese cake they're coming after us.

Because of what we've done and thank God the better business bill has endorsed us as an A plus rated cheese cake company.

And we've never had any complaints but we're insured just in case we do so for you to say.

If it was a bigger corporation and not the city that that is inspirational to me because that's laying all the facts on the table.

And to me to be given a report as you present it that's a disadvantage because you didn't have time to study that I studied it and it was so small I couldn't study it so I came here.

Now since you don't have a thing where we can put it on display the millennials who follow our family and I can turn to the audience because there's nothing here.

This is the name of our company call to the bay and back cheese cakes is was founded in Del Paso Heights we've gone I'm a baby boomer the millennials and younger people have taken it viral on social media and global and I'm still trying to understand it but I understand getting the cheese cakes where they need to be that's called logistics and if you don't.

If you get into some sort of insurance claim you can best believe they're going to get top dollar because we got top insurance so if you're paying premiums and you never get a claim the insurance company should feel relieved because they've never had any claims.

I think it's a reason I can speak to this I was in the business myself a Pippin I years here clean service and we see some things yes that on education based that you got to educate your people in administrations what to educate the employees.

Truly you got a lot of fake interest truly you have that something that I can raise but see the thing about it is we not speaking to what calls these claims can we have prevention in the administration to down this then we have to look at work was come is the big thing now home workers are they covered by your work was come and not on the site.

Look at that.

Roger the cover now see what we learned about the education was from insurance is your baby in should own the way school and after school nobody ever.

Also those things these are the things that we got to get with people that have been in the business and gold is if you've never been in the business how long have been in politics you know you.

You cannot cover this you have to have experience the business world to deal with this and I experience fifty nine years I never had a claim.

I don't have rides I swing off of but I know I was going off and do I just see these are the things that this city don't have enough people that have been in the business we're.

Nobody have been in the business so you got to depend on them we're not I want to say the things you want me to say I said the thing what I've experienced just like I like to see these guys and go with some things as I sit with the early

Teres alumnus like the LBAs and with all some things that we have to take a look at because I've been here since I 19 years old and 83 years old now and I'm looking for at least said move.

Thank you. I have no more comments. Okay I did during that I did have a chance to look at page 16 so if I can ask a question about about that in the report who's.

Yes there you are. Didn't see where you escaped to. I wanted to make sure if I understand that chart I assume you're referring to figure 11.

Figure 11 correct. Okay so in fiscal 24 then is that 11 million 172 figure what was paid out by the city and by the city in general liability claims.

So in self insured a retention not not premium but self insured retention.

That we yeah that was amount that the the actual areas estimate the city is going to be paying out.

When all the claims are settled that occurred so it's all done by fiscal year so it gets a little bit confusing but they go by the fiscal year so every claim.

That occurs in fiscal year 24 the actuary is predicting we're going to spend 11 million 172 to pay for all those claims and finally settle which could be 4 or 5 or 7 years later.

Okay I'm sorry I wasn't I was thinking there was 23 24 so 24 so let's so for all those numbers that ultimately where you still have claims pending it's it's combination of money that's paid out and the and the projection of what will be paid out.

Exactly so as you get older your claims it's more accurate because most of the claims are paid and settled the newer years obviously have a lot of reserves and nothing's been really paid on them yet.

Okay but but ultimately coming back to the the fiscal 24 number the expectation is that over time that 11 million figure will be what the city expends in self insured retention for claims settled or filed in fiscal year 24.

Okay okay thank you. Okay as I said I don't think we need a motion on the census receiving file.

That's correct it's a receiving file. Okay thanks very much thank you.

Thank you.

Appreciate the presentation and on to the next item if you want to read that.

Item 5 is fiscal year 2025 26 budget development update.

All right you didn't take the day off.

I did not know where where else would I rather be.

You're only going to grow one more year older today despite whatever happens and this is it's his birthday.

Everybody.

Happy birthday.

Thank you everyone and if anyone is in a giving mood and has $44.1 million dollars now we can solve the budget problem right here right now.

Good call.

Good call.

But good afternoon chair council members members of the public, Peacolette or the finance director.

We have a very brief budget update for the committee.

So this is just a summary of where we are now.

As you all know we started with a $62.2 million funding gap.

You know on February 24th we got the unfortunate news around our half allocation being lower than expected.

And then on the 25th council took early budget action allocating prior year savings to closing the budget gap.

So our target right now is $44.1 million dollars.

So how are we going to balance?

We need to present a balanced budget by April 30th.

So as you know departments were instructed to produce plans if you had to hit a 15% target what would you do?

And this is really to give a menu of options to council about how to balance versus just across the board cuts.

We also looked at citywide strategies which are mostly reallocations of projects that have either been completed or haven't started.

So on March 7th we released these to the public.

It's full transparency.

So if you go to the budget website you can see how it published there or they're attached to our staff report here.

And you can see all of them.

That chart there is a roll up of all the strategies.

So to hit our $44.1 million target we have around $108 million worth of options to choose from.

So on the service reductions they're ranked from low impact to severe impact.

And we want to minimize the impact on our residents.

So another big topic that we've been talking about lately has been our exposure to federal funding.

And you can see just on kind of what has been appropriated and approved.

We have almost $180 million dollars.

One reduction strategy you will not see on the citywide list that you saw on the citywide list last year is the contribution to the economic uncertainty reserve.

So last year we used that to restore some reductions in the budget and help balance.

This year we didn't include it on the list.

And the reason we didn't is we are going to recommend as part of the proposed budget.

So taking that funding is about $4.4 million dollars and putting it into a new federal funding loss contingency fund.

And really this is to give us a little bit of breathing room if things get tied up in litigation or if funds get outright pulled.

It will allow us some time to adjust.

I do want to pause here as well.

I should have mentioned before.

I would like to hear from fire for the next two items around fee increases.

So the EMS fee increase that was utilized as one of the funding mechanisms for the most recent local 522 contract.

So we are counting on that revenue.

And then the fire prevention fee increase that is listed as one of the revenue strategies.

The revenue strategy in the packet that's full cost recovery.

I know fire has heard some concerns about small business impact.

And so they've been looking at mitigation options which would lower the amount of revenue but protect small businesses.

As far as some of the pending factors again we have this big risk around the potential loss of federal funds.

We have our unfunded liabilities both for pension and our capital needs.

I'll mention this every time I come up the governor did not include an additional round of hap funding in his January budget proposal.

We have the risk of a recession which is becoming more and more worrying as we see some of these new economic policies go into effect.

And the other thing that I'll just mention is that we do have a lot of labor contracts coming up.

As the committee knows every 1% increase in labor cost citywide is $4.8 million of additional general fund costs that we don't have factored in to our target.

So I'll end with this. This is our budget calendar.

Our next really big thing here is going to be release of the proposed budget.

Again that needs to be balanced. It will be released the week of April 30th.

Council will have budget hearings in May and we're shooting for a June 10th budget adoption.

And so I promise to brief update and that is all we have and we're happy to take any questions.

Thanks for the presentation. Before we get to public comment I would.

Okay. All right. We'll take public comment then and then we'll hear from committee members.

So I have three speakers. I have three speakers. Lambert Macworthy. Then Jeff Bryant or Jason Bryant.

Okay. This is an idea that I took a lot of heat from this city for saying and I hope the public in the rostrums paying attention because it's real.

I was the one who said that people working remotely from the city should not get a raise. Why? Because they don't have to leave home.

I think some people have forgotten what it costs to come to work from traffic, etc.

And then I saw I think it was on 60 minutes where it said that a lot of workers from city hall and the state.

When the pandemic happened they moved 50 miles away from where they live.

Now that they have to come back to work is exposing what I was saying.

Which is 50 miles each way is a hundred miles a day.

Imagine the cost you could save from not giving them a raise.

To me the city of Sacramento should send me a check immediately because I was the one who said that and to the person who just spoke besides happy birthday.

I think he's sincere but his hands are tied because the people who really run city hall were part of that.

They should do an audit on how many city workers have moved away from Sacramento since the pandemic.

And I'll bet you that's why I say minty cup of the clerk should be the highest paid city hall because she's here.

I bet she she's going to be here at two and I bet she's going to be here at five just like me but I don't get paid.

So my suggestion is doing audit on how many people have moved away and send me a check for that.

Macworthy.

First of all people we need paperwork to look at instead of empty letter to a computer I wanted in my hands.

The city got too many buildings lease we would like to know what is the money you pay and out to lease you're trying to do something you never going to accomplish to be a big city.

We got too many places we got to the fire department got too many different places go to Polish department got two different places to go.

It doesn't take all that somebody don't know what to do in here.

You're going to be in the red we know because you're nonprofit organization that's known to be from Washington DC here for some things here that you are putting money into.

Should be changed as I said eliminate the police and fire department together you'll save a lot of money.

You're running together you don't need a police when every time a paramedic is called to a house you don't need a police.

When it's the fire the just faster no whether it's high rise or not high rise.

I accident and you go to jesterly though you got to do a sitting wait every other hour since the puts a certain lane you.

So you go you go have these things you have to understand this is not a big town town people here don't you have to education just like we come down here.

I have the knowledge of the city for quite a few years I can go right there and identify it to you but I'm not asking you to give me nothing.

I've never stood here since 2002 and asked for nothing get the hell out of my way I'll obtain but I will bring in a price is what we're going to bring people in here especially black people you're bring them in here and you were said nonprofit it's nothing nonprofit like both here you got to have some type of business and you the last to take sister.

Jason brand.

Good afternoon members of the council Jason Bryant resident of the city living in land park and organizing a group of residents who are deeply concerned about the takeover events that are occurring inside land park particularly in the handle region of the park between dock Oliver field and Riverside Boulevard.

And the types of events are street racing activities their cruising events their activities where people are coming from all over northern California descending on land park and shutting down the park to residents and guests and those that are looking to use the park for recreational purposes.

It is chaotic it is triggering a number of calls to police and to park rangers from the group of neighbors that I've organized we've got a strong group just in the last two weeks as this is intensifying we're looking for a solution to address the rather chaotic environment that exists in this part of the park on weekends that is really just dangerous and inappropriate.

So the staffs are used for recreation for people to enjoy the outdoors they're not automotive events for street racing or for blasting stereos all day and all night it's really impacting the access for all residents to enjoy the park.

We would like to propose and work with city staff including Jackie Beckham her team and city police to address this issue that will reduce the number of calls to the police and to park rangers who probably yet you know 20 to 30 calls each day just on average it's just a guess so we're looking forward to those discussions appreciate my council of regentings and the staff are willing to talk to us about this I wanted to raise a council today so thank you for your time.

Thank you for the comments you and can blesses our final speaker on the site.

There's a lot of attention that always goes into what is happening or the concerns of predominantly white neighborhoods and

and affluent neighborhoods like Land Park and East Sacramento that oftentimes overshadow and overlooked a lot of the historically divested communities here in Sacramento places like metal view of park North Highlands and old Sacramento and like North and South Sack in general.

But I think I'm seeing a lot of parallels from the previous five years of budget cycling including with last year's even despite the increased transparency and tiered reductions that I continue to find troubling one just to note being that among tiered reductions were seem to include a significant number of departments including the fire department when it comes to tier one reductions but all of the

police departments reductions are listed as tier two or tier two and and beyond and I don't see how things like the mounted services division which by my count only had two lives of officers are anywhere remotely top like considered beyond tier one.

I think that there is continued preference when it comes to public safety which is why more than 70% of the city's discretionary dollars has been allocated to the police and fire department while other important community needs areas like the parks department public works that could actually support and address a lot of the traffic safety issues around the city continued to go depend upon required for like you know only a few days before the city.

I think that's not really the enterprise funding or we just cut those I cut those services back as if those don't actually address the core issue that police and fires oftentimes see to address.

I'd like to actually see some real.

Thank you for your comments your time is complete so chair I have no more speakers.

Thanks. Thanks for your comments.

Okay.

Council Member Maple.

Thank you chair and happy birthday.

Yeah wonderful.

I hope you have a wonderful day planned except for being here until probably late evening.

Maybe so other point this week you can celebrate your birthday so but we appreciate it and I just wanted to start out by saying thank you so much for your work of you and your team and the entire city team and the budget staff.

I know this is we know this is a challenge in you and we're going to have to make some really difficult choices and I just have some comments not questions so you can stand there if you want or not.

So I just want to acknowledge that this hasn't been easy I know that this is not just a difficult choice for us up here but the so so difficult choices that are going to impact every neighborhood every family every employee as well and so I take that to heart and all these conversations.

I've been reviewing all these budget documents and looking over the reduction strategies I've been doing so with the keen interest on how is this going to impact the most underserved areas of our city.

So according to our city's own seat equity tool which is a data driven mapping tool that evaluates neighborhoods based on factors like income housing burden education environmental quality and access to opportunity not a single neighborhood in my entire district ranks in the top two tiers of equity.

So I'm going to ask the questions and start contrast some other districts and where the vast majority of neighborhoods are actually in the highest ranking categories.

This data shows that district five continues to face the most some of the most significant disparities all Sacramento.

We're talking about neighborhoods that are 25% or more of residents living below the poverty line or 60% are rent burdened and where the pollution exposure is over 50% higher than other parts of the city.

So I think that the communities where people are living on the edge their services are when when their services are reduced or eliminated it can feel like the ground is being pulled out from under them and that's what I'm hearing as I'm talking to my residents all over the district going to town halls community events they're really concerned.

And so I just want to be clear that I'm not I'm not comparing pain I think that every single neighborhood and community in the city of Sacramento deserves to have a thriving and well resource community.

All neighborhoods are starting from the same point and we know that and that's why we went and developed the equity tool in the first place.

So I'm really keen as we go through this process I know this is just an update today but we're going to have more conversations that we're really taking a look at.

How are the decisions that we're making going to either maybe unintentionally deep in some of these disparities that we're seeing in areas that are already experiencing it and I know that district two also shows a lot of the same challenges the district five does.

And so when we look at these post reduction strategies and know that we have to balance the budget it is required we must do it.

I'm really going to be taking a look at what are these strategies and how are they most impactful to this to district five in particular and some of the most underserved areas.

I look at things like you know elimination of team programs and youth employment opportunities the closure of our community pools for for experience extended periods of time reduced hours at community centers and more and.

Well that might be a challenging thing all of the city and places in my district that can literally be a lifeline that can be whether or not that child gets a meal that day or a senior gets a meal that day that can be whether or not those parents can actually show up to work.

And so I'm just so when I'm really focused on I love to either provide direction this is receiving file provide direction or just give feedback I would love to see the state tool use and have that information presented alongside future budget updates.

I'm I'm really interested in who's going to feel this the most will it worsen existing racial economic or geographic disparities and if possible are the different ways to each our physical goals without disproportionately impacting the areas that are most underserved.

And so I know we're going to have to make some of those decisions and I think since the our team at work so hard at developing the seat tool in the first place it's really an incredible tool if you haven't used it.

I spent a lot a lot of time over the last couple weeks looking at different census tracks all over the city.

I think it can be a really powerful tool for us to be able to make these choices in context right across the board cut can have a very different impact in district one than district five in district two.

And I think that we should be thinking about that as we're up on this dius and making these tough choices and so again just want to thank so much the staff for the time that you put into this I know that it's been challenging and looking forward to future conversations and hope that we can incorporate the seat tool for future budget discussions.

Thank you.

Thank you. One of the things that we've been working on with the racial equity committee is the role out of the use of the racial equity tool.

As part of the budget deliberation process and last year we had three departments who initiated we've added since two departments in the review this year you'll hear them at the end of May and the work that they did.

It is truly a capacity issue a learning issue of how departments are able to roll this into the budget process so not all have done but where it is appropriate and we see overall changes and levels of service if we can we will try to do that.

But not sure if we are going to 100% be able to do it for everything that you see because it really is a heavy lift in creating the capacity within the people who are just

profaring these things and understanding what they mean from an FTE account and a person count and a response count and then to add that geographic but it is a work in progress and we are working on it.

Thank you.

That's really helpful. Thank you and I appreciate and I know that you Madam and interim City Manager I know that you've worked very hard on this tool as well over many years and so I'm grateful it exists and that we're working on that and totally understand the need for capacity.

So maybe you know there's a way and I'm sure you're looking at this to ensure that we're putting it on the big ticket items you know and saying what does that mean if you were looking at things that are most going to impact youth and we can help with that provide direction on that but I'm.

Yeah thank you.

Yeah I do want to add one other thing because our IT department is going to go present at the ESRI conference to stay right in here.

I don't know if he's here.

The folks who created this E tool to share this with the GIS community nationwide for other cities to be able to use this tool so super proud of them and their accomplishments and that they're sharing what we've done here.

Good. That's very good.

Yeah.

Vice Mayor Pro Tem.

Thank you very much Chair you know same thing we had very deep discussions and conversations and the race and equity committee about the rollout on this and the goal is to get to 100% of every department using it the tool.

What we want to make sure is that we train staff not only to use it but then also to figure out how to implement it and what it means in that takes the the one on work to making sure that we're creating a culture of understanding the information.

So I think I think to your point we do need to to make sure that we get to 100% of every department what I would fear is that we rush it and then it just becomes say like a check mark.

So we want to make sure that we have a measure that doesn't actually give us also informative information because we want the staff themselves to say well we're seeing this information we want we want to reply back but we do want to get to that and I want to echo your concerns about making sure that we look at every district because to your point you know I worry about you know the George Simp community center and it's a availability.

So I agree with that the other thing is I wanted to support the staff on there the federal funding contingency fund for now my hope is that Congress will recognize that we have a president not a king in this country and that the issue of empowerment is a serious one one that the federal funds that were already appropriated to every jurisdiction across the country for law enforcement for public safety.

So I think that's the reason why I think that the that they're that they're provided and executed in the way that the Congress had already authorized so with that.

Appreciate the work and I acknowledge you know the the changes we have to do moving forward I know it's a it's a difficult conversation but the more informed where and the prep prepared we are to make those decisions that they will be good.

I also want to uplift that as part of the budget what Mayor Pro Temgara said is 4.4 million dollars that we're not putting into our EUR for our federal funding reserve just just in case of the impacts that we're going to feel from the Trump administration so want to uplift that and then that phone.

So I think that's the only way to get the money out of the city hall. Okay and then Mr. Worthy is out your cell phone.

Somebody's looking for you. Thank you sir. Thank you so much. And then I do have a question I had a chance to go through each one of these line item by line item and I know we're getting the department presentations but they're not going over like they're doing kind of brief 10 slides overview.

So I think there's a briefing with the city manager's office to go over each one of these are like how are we going to go through them and win.

So I think there are kind of two parts to it so one of you have specific questions on you know a strategy it doesn't make sense or you have questions about the impact let us know and we'll we can provide those answers via SBI items but when we when the city manager presents the proposed budget.

So we're going to be here from each of the major program areas or here are the strategies that we selected as part of the proposed budget to balance and here's what the impact of those strategies are going to be because again we're you know we have a universe of 108 million dollars worth of strategies and we need to choose 44.1 million dollars of them so that 44.1 you're going to hear in great detail during your budget hearings.

So we're going to see how we're going to see what the impact of those strategies are and why those were selected and what that impact will be but you know going up to them or because council will have the you know reserves to write to say hey you know city manager I didn't like that strategy but we still need to balance so I want to pick this one instead suffering so if you have some questions on what are the you know what is the this one instead mean you know we we can answer those for you.

Okay sounds good I just want to make sure that you guys are getting enough direction from us at budget and audit to go into the weeds of this so that we're not surprised when the budget comes out.

Yeah and I think budget doesn't come out to the week of April 28 so you have almost a month to be studying these and figure out where you do have questions and then I think Pete's right we're going to focus in April on those at the end of April and all of May on what was included in the proposed budget so that you will have details on the impacts of the proposed budget.

So in between now and then we wanted to be very transparent to both the council and the community what may be on the table and this is your opportunity as you're going through those if you want to schedule time with us and or departments to understand their reduction proposals and or what's included in the budget after the 28th we should certainly do that.

Thank you for all the all the comments. Pete thank you and and those who worked on doing the evaluation of the vacancies I appreciate that if no one else does I want to know I do and if I may I'd ask then now you cost them so you you came up with the figures of net FTE that would be we're nominal FTE and not net and net if you could cost that because I'm not sure if I'm going to do that.

Because I'm not looking at it was I think the year or more was equivalent of 203 full time FTE which is a little bit of 203 FTE or so but what is that what is that equal in dollars sure we'll we'll cost that out and then provide it as an SBI.

Yeah I appreciate that and I also appreciate the the actuals to budget comparisons as well I find that that kind of comparison very helpful and I and I think it does illustrate some areas where we budget and we consistently come in under that that budget number so there are lots of reasons for that that's obviously at the gross level but there may be something there to to drill down.

And I want to go down into a little bit as well I want to completely align myself with council member maples comments about about equity as we look at how we solve the budget issues that that we face and mindful of what what Mr. Gator said but but reductions

are not all equal everywhere and I think that's ultimately part of our job to figure out how to how to how to apply those but to the extent that as you look at at the list of tiers of impacts you incorporate the consideration of what's the impact on a territorial basis.

I think that I think that can be both informative and helpful putting some money that we might otherwise cut into some places whether it's a George Simpson or any any one of the number of locations around the city may actually have have a much greater benefit than putting it into some other department where we won't get the impact.

From that that expenditure say for the George Simpson or other parks or other kinds of other kinds of investments so that's a much trickier issue to try to evaluate but I think it's something that's on the minds of many of us sitting on this side of the table.

And finally I want to express my appreciation for the work that's been done so far it's interesting to note that if you if you take the citywide items if you take the revenue enhancements and you take tier one that adds up to about 42 million dollars.

Now we're not going to do any of all of those things in those categories but I think it's illustrative of if we I think if we're thoughtful and targeted in what we do we we can preserve most most all of what we want to see happen for the city and its residents with with the least amount of pain involved at least in this year.

I said finally but when a lawyer says finally that always means there's at least one more thing on the on the 4.4 million for the the federal reserve.

I have a slightly different I don't object to you doing that in principle I'm it's putting it there and labeling it but I would just say for my part I'm not necessarily committed to that being the ultimate use of that that money as a reserve when we get down to.

I'm going to hammering out the details of the of the budget.

There are impacts of great consequence that we could feel and all local governments as well as states could feel depending on what happens in Washington.

Whether setting aside a relatively modest amount shields us in some meaningful way from that compared to how we might spend it to preserve other items in our budget I think remains a question to be debated so I'll just indicate that level of question mark for me on that one so with that if there aren't other questions or comments from members.

This is also receiving file so thank you and wish you a very happy birthday and hope you have time for lunch.

Great thank you.

Thanks and thanks to all all the city staff who are here who've heard the conversation and who are working I know very very hard to try to figure out the best solutions for all of us.

Thanks.

Chair we need move to item number six which is proposed emergency medical services fee adjustments and I have no public comment on this item.

Okay.

Now comes the fun stuff.

Yeah that's right.

Good morning.

Good afternoon.

Members of the public and city staff.

The fire departments here before you today with two items proposed items for fee adjustments for EMS and for fire prevention fees we also have our consultant with us that help us work through this process.

So I'm going to turn it over now to chief builder to give you the high level on each item.

Afternoon council manager.

I know we're under some time constraints so I'll keep it brief just know that we have the whole team here to follow up with any technical questions you have.

My name is Tilden Bill Dorma deputy chief that oversees community services which includes the fire prevents and division and the EMS division.

A while ago we initiated a department wide fee study and we are mostly done with that fee study and I'll speak specifically to the proposed fees in front of you for EMS and fire prevention.

A little background in history the last time that we completed a fee study was in 2018 that is also the last time that we increased our fees for fire prevention and EMS.

Inside of that resolution we included a CPI and annual CPI for both fire prevention and EMS and unfortunately since 2018 that is roughly returned about 2 to 3% over the course of time.

If approved these fees will go into effect July 1st. If you look at these fees and you compare them against our comparables as it relates to EMS we are still under all of our comparables.

We are also doing a lot of work to ensure that we can increase the fire department to the EMS and the EMS.

We are also doing a lot of work to ensure that we can increase the fire department to the EMS and the EMS.

We are also doing a lot of work to ensure that we can increase their fire prevention fees and we are right in line as a comparable for them.

There was a request that was made about rolling some of the training costs as it relates to EMS.

We are exploring that option right now where we are meeting with our city attorney's office. It's a little bit of a complicated request because we have multiple programs in our training division that are attached to other funding sources.

So with that being said I'll close and we are available for any questions or comments.

Councillor Member Gare.

Thank you very much Chair. If there's no public comment Madam Clerk.

Great. Good. I will go ahead and move the item with some direction.

But first one I wanted to thank Deputy Chief Tilden for your work on how we can.

This is an area of the city where we can recoup some of our revenue and where much of it has been going to metro fire or consumers fire.

I think the one, the fee adjustments are important for looking at full cost recovery where the state is also paying some of this.

And I think it's important that we make sure that we capture that. Those fees and revenues.

So number one I'd like to give direction one to continue to pursue as we discussed the specific programs that are leading to our EMS recruitment.

There may be questions about the fee structure and prop to 18 spills out that process and there are indirect costs that are eligible for that.

And then there are those that are direct costs. But I do believe in my opinion that those efforts that we are using to making sure that we deliver EMS services are important to be associated in the fees.

So in that I think helps us in many ways. I mean I think one the recruitment of local people from Sacramento without we're not recruiting from out.

I think that helps on the retention side. Also it also makes our department look and reflect the diversity of our city.

But also I think it addresses the issue of the income gaps that we have in our region.

So I'd like to make sure that we continue to hone in on that. So I will make a motion to approve this to council with the direction to look at incorporating those recruitment programs both whether they be high school or adult programs.

And that are recruiting into the EMS to be part of that and also direct the staff to identify if that is not an eligible option to identify the amount of potential cost savings that are freed up through funds from the new fees that categories that could also offset the cost of this program.

So in this motion and in what we have we have new fees that are being appropriated. Those programs were paid by the general fund before. So those are cost savings. So I'd like to direct staff to identify that amount of cost savings to cover those programs if we cannot incorporate our recruitment programs into the EMS fee.

I'll leave it there if that's just.

If I may I just want to make sure I understand you the the you're asking to explore whether EMS recruitment activities recruitment and training activities are eligible for reimbursement by Medicare,

the Cal private insurance. Well all of our fees in our fee structure because we can then spread the cost of fees and there are some that may be eligible.

So that's what I'd like to I'd like to make sure we explore that.

So I believe the department is working through the notion of where it would be appropriate where there is an excess could be an extra cover for that and then use it to offset the cost of these programs.

So that work is already in play and would be brought back in any proposal that comes to council. There was a second half though that I do need a little clarity.

Yes, so there are new fees so I can probably look at maybe four or five new fees that we weren't collecting revenue for but we are going to collect revenue.

That's money that was not that was generally fund covered. So I'd like to get that total amount and say can we cover those fees and what I'm what I want to make sure is that if that savings can be can be focused towards EMS recruitment.

And one example is I'll say like the fire academy at Natomas high school and in Hiram Johnson that are recruiting people into our cadet program that go into EMS.

If we can't I'd like to I'd like to see if what that total cost is and can those fees be associated with our EMS services.

Generally our fees have to be associated with the service for which we're charging them for so there is that so if they are eligible to be used for that.

But if you're asking us to identify generic general fund revenues if they can't be used or included as part of fee recovery.

We are looking at fee proposals holistically and how those revenues revenues will offset all of the costs. So I think perhaps that's a conversation we have after we have the proposed budget to see what reductions are actually included.

Okay.

Well, if looking in here's what I would suggest and I'll work I want to work offline on this to identify for example the lift assistance fee in the medical assistance treatment fee.

You know those we weren't charging a fee for that before obviously it's an eligible fee for us to charge.

And that that money that would have been general fund money could we allocate it for those recruitment EMS services.

So and I don't know how much that is because what we're approving is the fee we're not approving we're not looking at the overall you know revenue generation in that in that process.

So I want to see okay you know this is this could could we allocate this so that there is also an exes in our general fund with our EMS services.

And that's what they are exploring.

Yeah.

Perfect.

Okay.

So I'm trying to figure out whether whether the additions that you made to the simple motion to approve the fee proposal need to be.

In the in the motion or not only the first one to which is already current which is can we include the full cost of the recruitment programs.

Okay.

Yeah.

If we're going to reach and that's great.

The challenge but worth looking at.

Yep.

Okay.

All right.

Is there a second to the motion?

Okay.

Okay.

We have a second.

And any other comments or questions?

Okay.

So the motion then is to approve the proposed fee increases and explore whether there are other opportunities to get reimbursement for costs associated with the EMS.

If that's if that's a fair articulation of it.

Okay.

All right.

If you know further comments or questions all those in favor signify by saying aye.

Opposed say no.

Abstentions hearing none motion carries.

Thank you.

Thank you.

Okay.

On to the next item.

Item seven is proposed fire prevention fee adjustments.

Hello again.

I there again.

Is there any questions about fire prevention fee specifically?

The overview I just gave kind of included both the historical background of the EMS fees as well as the fire prevention fees.

The last fee adjustment for fire prevention was in 2018.

Let's see if there are questions about it and then we'll take public comment.

Council member Maple.

One of the key questions I have is I know that you've been in conversations with especially the restaurants and other small businesses.

If you could one of the key concerns that I've gotten letters and sure others on the DSF here to about their concern about the proposed fees for places of assembly over 50.

Can you explain that a little bit to me about what their concerns are and if we can address them in any way.

I'll bring Jason Lee who are a fire marshal.

The technical expert of this.

And while you're walking up, you know, as I often say, my first career was in restaurants.

I worked 10 years and the time I was 15 until I graduated college.

And so I know how hard it is for restaurants in particular.

It's a very high risk business and they're making do with a little for a lot.

So just kind of curious if there's ways that we can help support them.

Thank you so much committee.

My name is Jason and the fire marshal for the state of Sacramento.

To answer your question specifically, we have a tiered approach for restaurants or places of assembly.

If a business has less than 49 occupants, we don't inspect them.

That's not something that we inspect.

So that would be a small restaurant or small location.

We would inspect a location and charge of fee for restaurants or locations of places of assembly above 50 or more.

And that is something where, like we said before, we did a fee study back in 2018.

And we haven't raised our rates since then until now.

Okay.

Thank you.

Council Member Dara.

Thank you very much, Fire Marshal Lee.

And appreciate all your hard work.

By the way, thank you for also your consistent engagement on addressing the illegal firework issue.

And I know we're getting ready for that reeducation time and season on that issue.

One, a couple of things.

I want to continue the outreach efforts, particularly with the business improvement districts and I'm thinking Stockton Boulevard, you know, in that area.

What I'd like to drill down, you know, maybe offline is our proposed fee here.

You know, it's going, say, for $3.27 to $8.89.

But when I look at Metro Fire, they're at $473.

And I don't know if they're doing full cost recovery or not.

I know there's no free lunch here, no pun intended for the restaurant world, right?

But I wonder if they're doing full cost recovery and they're charging $473.

And we're charging $8.89.

But, you know, I know one issue and that's unfortunate and collect bargaining here that is we're still trailing behind our Metro partners in their employee compensation.

So their employees make a little more but they charge less.

And so I'm just wondering where that gap is.

And I'd like to understand, you know, that issue, like, you know, what's the difference?

What are other agencies that maybe have higher operational costs than we do, but they charge less.

So, you know, not for now because I know this is a deeper thing.

But I'd like to see, is there something in their secret sauce, and I'll put an intended again in the restaurant?

That they're doing? That we're not doing.

Yeah. So, yeah, let's, if we can work offline, you know, on that, to find that answer that'd be helpful because, you know, I think it's still still not cooked.

Thank you, Mr. Chair.

Okay. Thank you.

Why don't we take public comment and then we'll come back.

Oh, I'm sorry. Did you want to get question? Okay.

I have one speaker, Jameson Parker.

Good afternoon.

Good afternoon.

I have to do a little bit ambitious by writing good morning to my talking points on this one.

Good afternoon, Chair and committee members.

Jameson Parker with the Midtown Association.

Midtown Association is a property business improvement district representing about 1300 properties in the urban core.

Our mission is to make Midtown the center of culture, creativity, and vibrancy in Sacramento, Zermen core.

I just want to start by saying we are very supportive of the fire department.

We appreciate everything that they're doing to make sure that they are whole and when they look at cost recovery from a fee perspective.

With that said, we do have significant concerns with the impacts that the proposed increase will have on small businesses and our special events in our public right away.

What makes Midtown the hub of intertaving and vibrancy is our network of small businesses and those create special events that are happening in our streets.

As a matter of fact, over 55% of our sales tax generated in Midtown is coming from our restaurants, our bars, and our nighttime venues.

These industries face many challenges and operate at a very thin margin already and we are concerned with what these fee impacts will do to their businesses.

In addition, our city is continuing to look at how do we become the city of festivals and we want to make sure we're doing everything that we can to make it easier to put on special events in the city.

Adding increased fees to special events makes it just that much harder to have those creativity and vibrancy that we're looking for.

Again, we appreciate the importance of what the fire department is considering with the fee adjustments but we need more time to work through what real impacts of the proposed fees will have in our city.

We look forward to having those conversations with the fire department and the fire marshal as discussion progresses. Thank you.

Thank you.

Thank you, comments.

Vice Mayor.

I'd like to make a motion to move this agenda in the side.

I'm forward and then just directing fire to continue doing outreach to the chambers and our small businesses and everyone impacted.

I know I'm a little bit sticker shock by the percentages of how much we're going to increase it.

I know it's because we haven't done so in so many years.

So what's got us here today, but I think moving forward on actually to the same manager like on any of our departments we need to make sure that our fees are keeping up today with cost of living and inflation and everything else.

And that way we're not spending 10 full years in between before we do a fee adjustment and then we're sticker shocked.

So let's do those increases as we go like for the various departments.

Okay, so your motion is to just send it to the council.

So I'm going to ask you a question for the future of rather.

Okay, all right, is there a second to the motion?

I might have some direction myself so I want to if it's okay, I'll maybe start speaking and then we can see if we can meet in the middle.

Okay, all right.

Thank you, chair.

And just want to say, well, thank you for the public who have written in and who's shown up and to our fire department.

I align myself completely with Vice Mayor Talhamontez.

I know it's really, it's been a long time since we've updated some of these and it is time.

I'm challenging right now with everybody feeling it in their pocket books, especially our small businesses and residents, but you know, ultimately we need to make sure that we're recovering our costs too.

So, you know, I am comfortable moving this forward, but I did want to provide some direction that we take a look at maybe phasing in the fees for assembly over 50 for the small businesses and be working with that with the small businesses to see if that's something that would help them be able to.

It's really, it must be difficult for them.

You know, one day it's this and next day it's something else and then you're all this and you're trying to figure out, okay, how am I going to make payroll and buy the food that I need?

So maybe there's a way that we can do that while still getting our cost recovery.

And so if you're comfortable with that amendment, I'm happy to second.

Yes, definitely.

Okay, thank you.

Okay.

Mr. Gatta.

Yes, I was actually going to ask if we could actually do if it's pleases the maker of the motion and the second to do also the 100 plus and I'll say that, you know, not all 100 pluses of assemblies are the same.

And I think about happy garden, you know, on Stockton Boulevard.

They, you know, have to have a lot of frequency for them to be able to make it.

And they have, you know, sometimes, you know, if they're lucky and they have good, you know, wedding venues or whatnot.

And yes, but many times like when I go there on the weekends, it is a place of 100 plus, but it's just the local families who are there.

So I think I want to look at what does it look like for all of them because it's just because your large doesn't mean that you're full all the time.

Are you speaking only of restaurants of restaurants?

Okay, okay.

A restaurant.

Yeah, a restaurant.

Because restaurants are the tough ones.

So I'd like to see what that breakup looks like and what's the loss to it, you know, that's what I think we don't know how many facilities there are.

I think it would be good if we could bring back a number of facilities, but I want to confirm we inspect to the maximum because that is when we need to be prepared.

Jason is nodding his head behind you all.

So I just wanted to make sure.

And then I will probably prefer some comments about what makes us different from Metro when we do hear this next time because we are indeed different.

So thanks.

Well, let me weigh in here if I may.

Because it is interesting to look at the comparison with other jurisdictions. And in some cases, we're up with a proposed fee.

Some cases were down still.

And West Sacramento is doing something with three for $346 bucks.

It seems to work for them, I guess, for the moment.

But it's not as I look at it, it's not just the restaurant.

I mean, it's across the entire spectrum of fee increases.

And this is the, this is certainly the downside of having a significant interval of time between coming back and revisiting fees that then you're trying to catching up on the one hand.

But it becomes a very large increment on the other.

And complicating this, of course, is we could use the money to help us balance the budget.

So there are a number of little asteroids here that are colliding out and out in spaces as I see it.

I do support looking at phasing, but not just for restaurants.

I support looking at phasing for across the spectrum.

And I'm not saying that I'm necessarily going to go that direction ultimately.

But I think we ought to look at whether it's split into a couple of years or three years.

What's the impact of doing that?

And for me, I would suggest doing it across the spectrum of fees.

Because a lot of these, you know, you look at apartment buildings, things like that.

I mean, they're going up 100 to 200%.

So it's not necessarily in consequential even beyond the restaurant setting from my standpoint.

So given that the motion that's on the table was restricted, as I understood it, to restaurants, I'm suggesting maybe we ask for an analysis that goes beyond that and looks at the entirety of the proposal.

I think we can offer some things real quick while you have the motion on the diast still to some of the areas that you're looking at haven't done a fee increase in over 10 years.

Some of the fees may have been adjusted when they were brought to their respective councils.

So like Sacramento has a fee that is lower than our initial fee that we're proposing.

Those are some of the directions you've given us is to look at and adjust already before the 22nd.

So we're going to work with the business community on that and we'll bring those adjustments back to the full council as well.

I just want to make sure that that was clear and we can get some answers for you as well too on those fees around us that look like their disparate today.

So maybe we can do just keep the original motion, the staff report and then when you come to the full council come back reports back on the 50 small businesses up to 50 and then the 100 and then restaurant and all the other businesses.

That way we get a supplemental to this report and that way we can see clearly.

I have one more thing to have where we're at again.

Yeah, that's a supplemental.

And I don't know if it's and this is maybe on Mr. Rurex realm on the Prop 18 question.

Can we as we move through this work with the business community also on a cost escalator, whether it's a CPI or whatnot.

I don't know if we can do that through Prop 18 or not, but I'd like to make sure that we kind of track through that.

So it's actually something that we already have built into most of our fees.

However, in some cases that escalator has not kept pace with actual cost because we use a cost of inflation CPI.

So maybe it's something that we could look at how we amend our fees and charges policy and then how we amend future fees and charges reports to give us more flexibility to ensure that our fees are keeping pace with cost better than just that.

One other item that we need to consider as the department.

It's been seven years since we brought this before you.

It's recommended every three years.

So we meet with our consultant every three years going forward.

We'll bring a new set of fees proposed to you every three years.

And then the year out years, we would be using the cost escalator to keep moving forward with the pace of the economy.

Well, do you need both? I mean, if you have a CPI adjustment, not a set 2% or something, if you have a CPI adjustment, then can you not just do that without the necessity of coming back periodically?

I think that what the chief is saying is that sometimes CPI doesn't keep pace.

And so it's probably a little stale. So that is probably something that could be updated.

Council, did you have? Okay.

Well, thank you. I appreciate that.

Assistant City Manager, just for that point, because we all know CPI didn't catch up with the impacts that inflation had on other parts of the economy.

But no, that's helpful.

I have to add on to the supplemental of the supplemental for council.

Okay. All right. So any other comments or questions?

So we have a motion on the table to approve and send this to the full council for consideration and include an evaluation of phasing in the fee increases and cost adjustment factor and three-year reconsideration.

Or new consideration of fees.

Does that capture it?

Thanks.

Okay. All right. Okay.

If there's nothing further, all those in favor signify by saying aye.

Aye.

Those say no. Any abstentions hearing none? Motion carries. Thank you.

Okay.

Now we have committee comments, ideas, questions, or meeting reports? Anybody?

No. All right. And then we have public comments for matters not on the agenda.

Thank you, Chair. I have six speakers. The first is Lambert, then Cindy Brown, Kevin Fiera, Kevin Brown, Mac Worthy, and Jason Bryant.

Lambert?

I would like to say that I'm acknowledging some people that are in the audience. They are what I call go getters.

And they are go getters. I'm a go getter. That's why to the Bay and Back Cheesecakes is in position that is in now.

Thank God for the millennials. They were tremendous this year so far.

They have inspired me now because now it's all about manufacturing. And that's my expertise.

We have a manufacturer in Southern California, and we have one in Northern California. And again, since we can't put that there, I want to show this to some of the what we call ballers and go getters that I believe are in this audience.

This is our company. It's the only one that if you go online and Google it, it's the only one that will come up by Google.

And I want to end by saying is one minute left. I think this committee is in great hands with Roger Dickerson. He asked the right questions.

He inquires about things. Even when they give him reports at the last minute, he can still figure out what about this? What about that?

I know exactly what I see here. And because I don't get paid to say this, I really mean this. If a person was in the chamber during the pandemic, how many people can say they work?

It's been an honor, Minty Cupi, as I go and follow these young people and sell millions of cheesecakes.

Thank you for your comments. Cindy Brown and Kevin Fiera.

Good afternoon. Good afternoon, everybody. Be quick. Kevin Fiera, the Executive Director of the Sacramento, Sierra building and Construction Trades Council.

We're asking the committee to keep in consideration public works and workforce development in the budget proposals.

Both of them, they actually hold hands. One is weaker without the other. They are stronger when they're together.

And we have an agreement with the city from the building Tracer's perspective with the community workforce training agreement with the public works developments that we have actually reached out to the 16 economically challenged zip codes of the city and actually transform lives into building of construction projects through our apprenticeship programs with members of the community.

Just to be quick, what does some of that look like? I'll just give one demographic and then Cindy and Kevin Brown can enhance on that afterwards.

This is what we know from 2017 to current. The building trades has increased. It's African American apprenticeship programs by 1000.

And so we were pretty happy with that number and we want to continue to grow it. But it can only happen with public works and workforce development investments.

All right. Thank you so much. Thank you.

Next speaker is Cindy Brown and Kevin Brown.

Hello. I'm Cindy Brown with the people working together. There's very exciting things going on in the city.

From 2017, we have launched our workforce development. We are, we have shown to be very great partners with the building trades, as Kevin Fira mentioned.

Together, we've been able to not only, it's not only African American, it is women in construction. It is ex-offender or justice involved. Foster Care Youth Homelessness, right?

For those communities, low-income communities as well, we develop a very strong outreach to these, to these pockets of folks, these populations.

We nurture those, we build those relationships and nurture them. We don't even have to advertise people know in the city. People of need know come to people working together. They will help you.

We have transformed lives in various generations. Now people are bringing their sons, their daughters, their nieces and nephews.

We bring them into life skills, workforce development skills. We help them with placements, along with the building trades working together to do that.

We reach out to at-risk youth so it can build a pool of folks as well to come into the trades right out of high school.

We just want to let you know this great work that's going on is very exciting. We're going to look forward to getting some time with each of you to talk a little further about how we can continue this work.

Thank you.

Kevin Brown, then Mac Worthy.

That was the powerful Brown.

That was the powerful Brown. Good afternoon.

I'm from the broader being established. I am Kevin Brown, CEO of People Working Together. And since 2017 specifically for the CWTA, in partnership with the building trades, we have been able to create something that provides societal and communal change.

And what we're asking for needs most overwhelming circumstances is that we consider allocation for workforce that we can continue to provide this societal and communal change to really transform this community.

So thank you very much.

Thank you.

Mac Worthy.

And then Jason Brandt is after Mr. Worthy, but I don't see it.

People we see here and still we got the city manager talking about race.

Can she tell who broke the round that?

Wake up. She also speak here. She also be out here with those others. I went to the court coming here.

And somebody go to jail for misuse and money. And then we look at some situation here.

The council and no park. You don't know what you're doing. You just there. Even to the fact you go and have some city cards like the NWC.

You don't know about the NWC. Nothing what you're reading.

Integration with the worst thing ever happened to American in laws.

I was a part of that. I dropped out of college because I denied to demonstrate and you put a dog on me.

I will kill you and think nothing but ask in human.

That's when I came here in 19 years old. And this is what I find here. Race equity.

Race equity is a lie and a bunch of shit people wake up. That's all it is.

You have to count your hurt when you bring a man what bulls and what is helpers.

Kill the bulls we also want to have one for her. That's what you do.

Look at the count of us. The government say heart attacks and strokes. That's something black men.

We can't be on the police department and fire department. Race equity is that race equity?

90% of the five minutes is white. A 90% of police department.

You're positing the death and allowing to the people.

Thank you for your comment. Jason Bryant.

I don't see Jason. Chair you have no more speakers.

Looks like we have completed our business for the day.

We thank you all for being here and this meeting is adjourned.