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GOOD EVENING.[CALL TO ORDER (Part 1 of 2)]
CALL THIS MEETING.THE RICHARDSON CITY COUNCIL TO ORDER.
TONIGHT IS A WORK SESSION FOCUSED ON OUR BUDGET, AND IT IS 6:00 PM FIRST ITEM OF BUSINESS IS PUBLIC COMMENTS ON AGENDA ITEMS AND VISITORS FORUM.
MAYOR, WE ARE NOT IN RECEIPT OF ANY CARDS IN ADVANCE OF THE 5:00 PM DEADLINE, AND OUR CITY SECRETARY IS INDICATING WE HAVE NO SPEAKERS.
[B. REVIEW AND DISCUSS FISCAL YEAR 2024-2025 BUDGET FOR OPERATIONS, CAPITAL IMPROVEMENTS, AND DEBT SERVICE ]
TAKE US TO ITEM B REVIEW AND DISCUSS FISCAL YEAR 24, 20 25, BUDGET FOR OPERATIONS, CAPITAL IMPROVEMENTS, AND DEBT SERVICES.AND BEFORE WE HAND THIS OFF TO MR. MAGNER, I'D LIKE TO SAY A COUPLE WORDS IF I COULD, TO SET THE TONE FOR TONIGHT.
AS A REMINDER TO OUR CITIZENS AND THE PUBLIC, WE'VE BEEN PRESENTED PROBABLY ON FIVE DIFFERENT OCCASIONS ALREADY, DEEP DIVES THAT HAVE PREPARED US FAR, TONIGHT'S SESSIONS, AND PULLING ALL THE LOOSE ENDS TOGETHER.
I WANT TO THANK OUR FINANCE TEAM WHO DOES AMAZING JOB.
I BELIEVE IT'S 12 CONSECUTIVE YEARS OF TRIPLE A BOND RATING, UM, STANDARD AND POORS AND MOODY'S.
AND IT DOESN'T JUST HAPPEN, BUT THIS IS WHERE IT STARTS TO HAPPEN.
AND SO I WANT TO GIVE A, A HUGE SHOUT OUT BECAUSE NO STONE IS UNTURNED AS WE SEE IT.
AND I'D ALSO LIKE TO SAY THAT I REALLY APPRECIATE, UH, MR. MAGNER AND HIS TEAM AS THEY HAVE APPROACHED EACH AND EVERY COUNCIL MEMBER IN THOSE ONE-ON-ONES THAT WE HAVE ON A REGULAR BASIS TO GET THAT FEEDBACK AND TO SHARE, UH, OUR THOUGHTS AS IT RELATES TO THE BUDGET AS A WHOLE AND THE BIG PICTURE.
AND SO, AS WE GO THROUGH IT TONIGHT, WE'LL GET INTO SOME OF THE DETAILS, BUT PLEASE NOTE THAT MINUTIA TYPE THINGS HAVE BEEN THERE THROUGHOUT OUR DEEP DIVES IN A LOT OF THINGS.
SO THIS IS AN OVERVIEW, BUT IT'S A GREAT OVERVIEW.
JUST AS EARLY AS I THINK A WEEK AND A HALF AGO, WE GOT ADDITIONAL INFORMATION AND OUR FINANCE TEAM WENT TO WORK AGAIN, TRYING TO FIGURE OUT WHERE WE STOOD.
AND I THINK THE STORY THAT'S GONNA BE TOLD TONIGHT IS REALLY, REALLY POSITIVE.
AND I WANT TO THANK EVERYBODY FOR YOUR HARD WORK.
SLEEPLESS NIGHTS, WEEKENDS, ALL THOSE THINGS.
SO, COUNSEL, THANK YOU FOR REVIEWING.
WE'VE HAD THIS BOOKLET SINCE LAST THURSDAY.
WE'VE HAD OPPORTUNITIES TO LOOK AT IT.
THERE'S A LOT OF INFORMATION TO DIGEST, BUT OVERALL, I THINK IT'S A REALLY BRIGHT LOOKING FUTURE, AND AT LEAST IT'S A GREAT PLACE TO START.
SO, MR. MAGNUM, I'M GONNA LET YOU HAVE IT.
HOPEFULLY I DIDN'T TAKE ANY OF YOUR STEAM AWAY, BUT I'M PRETTY EXCITED TO BE HONEST WITH YOU.
UH, VERY MUCH LOOKING FORWARD TO THIS, UH, OVER THE PAST FEW WEEKS AS WE'VE BEEN, UH, FINALIZING, UM, OUR, UH, PROPOSED BUDGET FOR YOUR CONSIDERATION.
I WANNA JOIN THE MAYOR AND, UH, THANKING BOB AND KARA AND ANITA AND TODD FOR BEING HERE.
OUR CMO TEAM, OF COURSE, HAS BEEN, UH, INTEGRAL IN, UM, GETTING TO THIS POINT AS WELL.
AND, AND, UH, SO MANY OF OUR DEPARTMENT DIRECTORS AND ASSISTANT DIRECTORS AND DIVISION HEADS ALL, UM, WORKED VERY HARD, UH, THIS YEAR.
AND AS YOU'LL SEE, THIS IS A BUDGET THAT'S QUITE A BIT DIFFERENT FROM THE PRIOR TWO YEARS.
UM, IT TOOK A LOT OF CREATIVITY, A LOT OF FLEXIBILITY, AND A LOT OF, UH, ADAPTING ALONG THE WAY, UH, TO GET TO A POINT WHERE, UH, I AM, UH, VERY EXCITED TO SHARE WITH YOU, UH, THE DETAILS OF OUR PROPOSAL.
SO, UH, BEFORE WE GET STARTED, LET ME JUST KIND OF GIVE YOU AN OUTLINE, IF YOU WILL, OF, OF WHAT TONIGHT WILL LOOK LIKE, AND THEN TOMORROW NIGHT.
UH, SO, UH, AS WE BEGIN, UH, WE'LL TALK A LITTLE BIT JUST ABOUT THE GOALS FOR THE WORKSHOP THIS YEAR, AS WELL AS SOME OF THE COUNCIL TACTICS THAT'LL BE ACCOMPLISHED VIA THE, THE, UH, BUDGET DEVELOPMENT PROCESS.
UH, THEN I WANNA TAKE A FEW MINUTES AND TALK ABOUT, UH, SOME ECONOMIC FACTORS, UH, AND HOW THAT IS IMPACTING OUR GENERAL REVENUE, OUR GENERAL FUND REVENUE.
UM, I BELIEVE IT'S VERY IMPORTANT TO UNDERSTAND, UM, THE NATIONAL FACTORS, UM, THAT ARE IMPACTING US LOCALLY.
AND THEN, UH, BETTER APPRECIATE HOW THAT LOCAL IMPACT IS, UH, IS, IS IMPACTING, UH, THIS YEAR'S BUDGET AND WILL LIKELY CONTINUE TO IMPACT, UH, OUR BUDGET CONSIDERATIONS FOR THE NEXT TO TWO TO THREE YEARS AS WE WORK THROUGH CERTAIN ECONOMIC AND REAL ESTATE, UH, CYCLES.
AND SO I'D LIKE TO SPEND SOME TIME ON THAT.
UH, IMPORTANTLY, UM, UH, I KNOW TO YOU AND TO THE COMMUNITY, UM, IDENTIFYING, UH, IMPACTS IS ONE THING, BUT HOW ARE YOU ADDRESSING THOSE IMPACTS AND HOW ARE YOU RESPONDING TO THOSE IMPACTS IS A COMPLETELY DIFFERENT ISSUE.
AND SO I'D ALSO LIKE TO SPEND SOME TIME, UH, DISCUSSING TWO VERY IMPORTANT STRATEGIES THAT WE'VE EMPLOYED, UH, MULTIFACETED STRATEGIES, BUT STRATEGIES THAT WE'VE EMPLOYED, UM, AND TO, TO COMBAT SOME OF THESE FACTORS THAT, UH, WHILE, UM, NOT IN OUR DIRECT CONTROL, WE HAVE TO MANAGE, UH, IN SPITE OF.
AND THEN WE'LL, UH, COVER SOME KEY AREAS OF FOCUS THAT, UH, I, I'VE IDENTIFIED, UH, FOR THIS YEAR'S BUDGET.
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THEN I'M GONNA, UM, UH, COVER JUST ONE, UM, SOME HANDFUL OF ADDITIONAL CONSIDERATIONS RELATED TO, UH, A ONE TIME TRANSFER THAT I'M GONNA PROPOSE.I'LL THEN TURN IT OVER TO, UH, BOB, WHO'S GONNA GO THROUGH, UH, THE GENERAL FUND HIGHLIGHTS, UM, UH, BY, UM, KIND OF DISCIPLINE AREA.
AND THEN WE'LL FIGURE, WE'LL FIND, UH, I GUESS FOLLOW UP AND, UH, KIND OF FINISH UP THE NIGHT WITH A, A TAX RATE DISCUSSION.
UM, I WANTED TO COVER THE TAX RATE, UH, UH, DISCUSSION TONIGHT, UH, SO THAT THE, THE COMMUNITY COULD HEAR, UH, THE DIALOGUE AROUND THAT.
AND THEN, UH, PROVIDE AN OPPORTUNITY TOMORROW, AGAIN, AS WE HAVE A VISITOR SECTION, UH, FOR, UH, THE COMMUNITY TO PROVIDE ANY IMPACT OR ANY ANY COMMENTS OR FEEDBACK THAT THEY MIGHT HAVE BEFORE WE ASK YOU TO TAKE, UM, THE ACTION TOMORROW TO NOT TO SET THE PUBLIC HEARING FOR, UH, THE TAX RATE, AS WELL AS, UM, FOR, UH, THE BUDGET TOMORROW NIGHT.
UH, WE'LL FOCUS, UM, ON, UM, JUST SOME, SOME INTRODUCTORY REMARKS I'VE GOT AROUND HOW WE APPROACHED, UH, THE OTHER OPERATING FUNDS.
OUR BUDGET, UH, WORKSHOP REALLY FOCUSES ON THE GENERAL FUND, UH, WATER AND SEWER DRAINAGE, SOLID WASTE GENERAL FUND, A HOTEL MOTEL.
UH, WE'LL PRESENT THE REMAINDER OF THE FUNDS TO YOU, UH, WHEN I PRESENT, UH, THE BUDGET, UH, THE MONDAY SUBSEQUENT TO, UH, THE FILING.
UM, WE'LL FINISH UP TOMORROW NIGHT WITH A DISCUSSION AROUND THE CAPITAL, UM, AND DEBT PLANNING.
UM, AND THEN, UH, CONCLUDE WITH SOME, UH, NEXT STEPS, UM, AS WE TALK ABOUT EACH YEAR, UM, WHILE TONIGHT IS THE CULMINATION OF THE DEEP DIVES THAT THE MAYOR MENTIONED, AND THE START OF, UH, A SERIES OF MEETINGS THAT ULTIMATELY LEAD UP TO THE BUDGET, UH, ADOPTION IN SEPTEMBER.
UM, THIS IS A YEAR-ROUND EXERCISE FOR OUR TEAM, PARTICULARLY IN A YEAR, UH, LIKE THIS, WHERE WE SAW SALES TAX RECEIPTS, UH, REALLY BE, UM, REALLY EARLY ON IN, IN THIS FISCAL YEAR, START TO, UH, FALL BELOW, UH, PROJECTIONS.
UM, I'M, UH, EXTREMELY PROUD OF THE BUDGET THAT I'M GONNA PRESENT TO YOU FOR YOUR CONSIDERATION TONIGHT, BUT I'M EQUALLY PROUD OF THE WORK THAT WE'VE DONE, UH, THESE PAST FEW MONTHS TO DEAL WITH, UH, WHAT HAS, UH, BEEN, UM, UH, SEVEN OR EIGHT NOW CONSECUTIVE MONTHS OF, UH, SALES TAX RECEIPTS THAT HAVE FALLEN BELOW THOSE EXPECTATIONS.
AND OUR, OUR TEAM, UH, UH, THE WHOLE CITY ORGANIZATION HAS BEEN EXTREMELY RESPONSIVE TO THE NEED, UH, TO MAKE SURE THAT THIS BUDGET IS, IS CONCLUDED ON A, IN AN ACCEPTABLE WAY, AND, UH, IN, IN A WAY THAT, UH, MEETS ALL OF OUR, UH, FINANCIAL POLICIES AS WELL AS AS YOUR GOALS.
UH, SO FOR OUR WORKSHOP GOALS, WE WANT TO JUST LAY OUT OUR OVERALL STRATEGY FOR THIS YEAR.
AGAIN, BUILDING ON THOSE DEEP DIVES.
WE WANNA REALLY GIVE YOU THE OPPORTUNITY, UH, AND WE HOPE THAT THROUGHOUT THE ENTIRE NIGHT IT IS A DISCUSSION, AND THAT WE DO HAVE, UH, GOOD DIALOGUE.
UH, THERE, THERE, AS I MENTIONED, THIS ISN'T A BUDGET LIKE WE'VE SEEN IN EACH OF THE LAST TWO YEARS, SO THERE SHOULD BE PLENTY OF OPPORTUNITY, UH, TO, TO ACCEPT YOUR FEEDBACK.
AND, AND THEN OF COURSE, WE'LL CONTINUE TO INCORPORATE THAT FEEDBACK, UM, INTO THE FUND SUMMARIES AS WE PREPARE FOR, UH, THE BUDGET THAT I'LL FILE ON THE 15TH.
UM, AND AS I MENTIONED, UH, WE WILL ALSO BRING BACK THE OTHER, UM, UH, UH, FUNDS THAT, UH, WILL BE SUBMITTED WITH THAT BUDGET FOR YOUR CONSIDERATION.
I DON'T WANNA GO THROUGH THESE BECAUSE I, WE HAVE IMPORTANT BUSINESS TO COVER TONIGHT, BUT I DO WANNA REMIND YOU, UM, THERE ARE EIGHT TACTICS, UM, THAT, UH, THE COUNCIL ADOPTED BACK IN NOVEMBER OF, UH, OF, UH, 20, UH, THREE THAT, UH, REALLY GET SATISFIED THROUGH THIS BUDGET DEVELOPMENT PROCESS.
EVERYTHING FROM OUR ANNUAL COMPENSATION ANALYSIS TO OUR CONTINUED, UM, EVALUATION OF CORE PLAN AND IMPLEMENTING STRATEGIES TO MAKE THAT, UH, SURE THAT'S SUSTAINABLE THROUGHOUT THE YEARS.
OF COURSE, YOU'VE ALREADY, UH, HANDLED THE BUSINESS AROUND THE, UM, ANNUAL REVIEW FOR, UH, THE, UH, PROPERTY TAX EXEMPTION, UH, RAISING THAT TO FROM 130 TO 145 FOR, UH, SENIORS AND, AND OTHERS.
UH, SO JUST A LOT OF GOOD WORK THAT, UH, COMES OUT OF YOUR TACTICS THAT IS ACCOMPLISHED, UH, THROUGH THIS BUDGET DEVELOPMENT PROCESS.
AND THEN ULTIMATELY, YOU TAKING THE ACTION OF DEVELOPING, OF, I'M SORRY, OF, UH, ADOPTING THE BUDGET.
SO LET'S TAKE JUST A QUICK LOOK HERE AT, UH, GENERAL FUND.
I'D LIKE TO START LOOKING AT THE, UH, BY TALKING ABOUT THE REVENUES AND REALLY GET INTO SOME OF THOSE ECONOMIC CONSIDERATIONS.
I THINK IT'S VERY IMPORTANT, UM, THAT OUR COMMUNITY UNDERSTAND, UM, NOT MANY OF THE IMPACTS, UH, THAT WE ARE SEEING, UM, IN TERMS OF THE IMPACTS ON OUR SALES TAX OR THE IMP, THE IMPACT ON CERTAIN SECTORS OF OUR, UH, UH, PROPERTY TAX THIS YEAR.
AND AGAIN, I BELIEVE FOR THE NEXT TWO TO THREE YEARS ARE LOCALLY, UM, UH, LOCALLY DECIDED ISSUES.
THESE ARE ISSUES THAT ARE AT THE FEDERAL LEVEL, LEVEL, THE NATIONAL LEVEL, UH, BUT AGAIN, IN NOT NOTWITHSTANDING THAT WE HAVE TO MANAGE AND WE HAVE TO MANAGE EFFECTIVELY.
AND THAT'S HOPEFULLY A LITTLE BIT OF THE STORY THAT I'LL TELL YOU, UH, TONIGHT.
SO THAT $180 MILLION IS THE GENERAL FUND REVENUES EXPECTED THIS YEAR.
UH, YOU KNOW THIS AS, AS WELL AS I TO, UH, PROPERTY TAXES AND SALES TAXES ARE THE DRIVING FORCE, UH, IN THIS REVENUE CATEGORY, 72 AND A HALF OR SO PERCENT OF ALL REVENUE, UH, FOR THIS, UM, UM, THIS, UH, FUND COME FROM THOSE TWO
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SOURCES, A LOT OF OTHER IMPORTANT SOURCES THERE.BUT AS THE GENERAL FUND GOES, AS PROPERTY TAX AND SALES TAX GOES, WE ALL KNOW THAT, UH, THIS IS A CHART YEAR OVER YEAR CHANGE IN REVENUES.
UM, YOU CAN SEE, UH, PROPERTY TAXES ARE UP ABOUT TWO POINT, UH, FIVE, SEVEN, $9 MILLION.
FRANCHISE FEES, UH, INTEREST EARNINGS, UH, REC AND LEISURE FEES, UH, OTHER REVENUE AND, AND THE G AND A CHARGES ARE ALL UP AS WELL.
UH, BUT LARGELY OFFSET BY THAT ONE BIG RED LINE TO THE LEFT, WHICH IS SALES TAX, UH, WHICH IS CURRENTLY, UM, UH, AT $5.2 MILLION, UM, UH, ESTIMATED TO BE $5.2 MILLION, UH, LESS.
AND THEN, UH, SOME SMALL DECREASES IN LICENSES AND PERMITS AND FINES OF IN, UH, FORFEITURES.
THE BOTTOM LINE TO THIS, UH, TWO SIDES OF THIS LEDGER IS THAT REVENUES ARE ONLY PROJECTED TO INCREASE $1.1 MILLION, UH, IN FY 25 OVER FY 24.
REVENUES ARE ONLY ESTIMATED TO, UM, INCREASE $1.1 MILLION ONCE THE, UH, BALANCING OF THESE TWO SIDES OF THE, OF THE EQUATION HERE ARE, ARE HANDLED.
THAT'S LARGELY IN PART TO TWO FACTORS.
UM, WHAT WE'VE, UH, BEEN ABLE TO REALLY, UH, DISCERN HERE IS THAT THIS PERSISTENT INFLATION THAT WE'VE SEEN FOR THE LAST THREE YEARS PLUS HIGH INTEREST RATES, UM, HAVE REALLY IMPACTED BOTH, UH, BUSINESS AND CONSUMER SPENDING, IE SALES TAX.
AND THEN THE EVOLVING OFFICE MARKET HAS REALLY IMPACTED, UH, OUR PROPERTY TAXES, UH, UH, PARTICULARLY, UM, THE, UH, OFFICE SECTOR.
AND, UH, OUR BIGGEST RISK MOVING FORWARD IN MY OPINION, IS, UH, THE OFFICE SECTOR AND THE IMPACT THAT THAT WILL CONTINUE TO HAVE ON PROPERTY TAXES.
UM, SO LET'S GET A LITTLE, LET'S TALK A LITTLE BIT JUST ABOUT WHERE ALL THIS BEGAN.
SO REALLY TO UNDERSTAND THE SITUATION WE'RE IN TODAY, REALLY NEED TO GO BACK, UM, TO, TO COVID-19.
AS YOU RECALL, AT THE START OF THE PANDEMIC, THE ECONOMY LOST ALMOST 23 MILLION JOBS, SEEMED LIKE OVERNIGHT, AND WE, WE REALLY QUICKLY PLUMMETED, UH, AS, AS INTO RECESSION.
UM, THE FEDERAL GOVERNMENT RESPONDED BY, UH, INCREASING ITS SPENDING.
AND YOU CAN SEE THERE, THIS WAS, THIS WAS INTERESTING RESEARCH TO ME THAT THE FEDERAL GOVERNMENT SPENT $1.6 TRILLION BETWEEN MARCH OF 2020 AND THE END OF 2020.
IN RESPONSE TO COVID-19, THEY ENDED UP SPENDING ON ALL FRONTS ABOUT $7 TRILLION IS WHAT THE COVID RESPONSE COSTS.
BUT IN TERMS OF DIRECT OUTLAYS AND, AND REALLY TRYING TO GET THE ECONOMY STABILIZED AND STARTED THAT $1.6 TRILLION IN FFY 2020.
OF COURSE, UH, THE FEDERAL RESERVE ALSO IN, UH, ALSO LOWERED INTEREST RATES AT THAT TIME.
AND WE'LL LOOK AT A, A CHART, UH, TO, TO DEMONSTRATE THAT.
AND THE SUBSEQUENT IMPACT IT HAD NOT WITHSTANDING, UM, WE, WE, WE ALL TALKED ABOUT IT.
UH, THERE WERE PRODUCTION SHUTDOWNS, SUPPLY CHAIN ISSUES, ALL OF THAT LED TO A SHORTAGE OF, OF GOODS, WHICH RAISED PRICES.
MEANWHILE, THERE WERE A SIGNIFICANT INCREASES, UM, AND, AND A SHIFT IN, UM, THE DEMAND FROM SERVICES TO, TO PRODUCTS, UH, WHICH ONLY EXASPERATED THE ISSUE OF SHUTDOWNS AND SUPPLY CHAIN ISSUES.
BUT RECALL, WHAT DID WE NEED? WE NEEDED HARDWARE, WE NEEDED THINGS TO WORK FROM HOME.
WE DIDN'T NEED SERVICES ANY LONGER.
AND SO GLOBALLY, COMMODITY PRICES SURGED AS A RESULT.
AND, UH, IT REALLY AFFECTED JUST ABOUT NEARLY EVERY SECTOR, ALL OF THE, ALL THREE OF THESE, UH, REALLY CONTRIBUTING TO INFLATION.
AND AS YOU CAN SEE BY THIS CHART, IN JUST TWO SHORT YEARS FROM THE ONSET OF THE PANDEMIC TO MARCH OF 22, UM, WE REACHED THE, THE HIGHEST INFLATION RATE IN MORE THAN TWO DECADES.
IN TWO SHORT YEARS, WE WENT FROM ALMOST A NON-EXISTENT INFLATION RATE TO ALMOST A, UH, 9% INFLATION RATE.
NOW, THIS IS NOT A SURPRISE TO THIS COUNCIL BECAUSE EACH OF THE PAST TWO YEARS, AS, AS WE'VE BEEN MORE INTERNAL LOOKING AT THE IMPACTS OF INFLATION, WE'VE SHOWN YOU EXAMPLES.
SOME OF THE EXAMPLES WERE, WERE WAY MORE THAN 9%.
THEY WERE 15% AND 20%, AND 30% YEAR OVER YEAR OR YEAR COMPARED TO, TO, TO 2019 AS WE OFTEN PRESENTED THEM.
SO THIS ISN'T A SURPRISE, BUT IT ALSO HAD THIS NATIONAL HERE IN HERE IN DALLAS, UH, NORTH TEXAS, EXCUSE ME.
UM, THE IMPACT OF, UH, THE INFLATIONARY PRESSURE WAS EXASPERATED, UH, THE, THE ONGOING, THE ONGOING, UH, DEMAND FOR, FOR MOST GOODS AND SERVICES BY THIS CONSTANTLY GROWING POPULATION THAT WE HAVE HERE IN NORTH TEXAS, UM, CONTINUALLY GROWING, UM, CONTINUES TODAY, EVEN TO OUTPACE SUPPLY.
I MEAN, YOU CAN THINK OF JUST THINGS OF HOUSING, FOR INSTANCE.
I MEAN, YOU COULD GO ON AND ON THE LIST OF EXAMPLES WE COULD SPEND, UH, TIME DISCUSSING HERE OF THE, THE BLESSING OF BEING IN NORTH TEXAS, AND EVERYBODY WANTED BEING HERE BECAUSE OF OUR ROBUST ECONOMY, AND BECAUSE OF THE GREAT BUSINESS ENVIRONMENT WE HAVE CREATES ALL OF THESE OTHER ISSUES, PARTICULARLY IN A TIME WHERE YOU'RE SEEING INFLATION RIVAL 9%, UM, AT THE NATIONAL LEVEL.
UM, LOCALLY, THE IMPACT OF THIS PERSISTENT INFLATION FOR OVER THREE YEARS NOW HAS HAD THE IMPACT OF REDUCING PURCHASING POWER FOR BOTH
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CONSUMERS AND BUSINESSES.AND AS A RESULT, WE'VE SEEN SIGNIFICANTLY LESS SPENDING AND INVESTMENT.
AND THAT RESONATES IN BOTH OUR SALES TAX, IN OUR PROPERTY TAX, AND WE'LL TALK ABOUT HOW WE SEE THAT A LITTLE BIT MORE.
IN ADDITION, OF COURSE, THE, THE UNCERTAINTY THAT BOTH CONSUMERS AND, AND BUSINESSES HAVE FACED, UH, UH, HAS ALSO LED TO INCREASED PESSIMISM, UH, ABOUT THE ECONOMY, WHICH HAS ALSO IMPACTED SPENDING.
SO HOW DOES THE FEDERAL GOVERNMENT DEAL WITH INFLATION? THEY RAISE INTEREST RATES, AND OF COURSE, WE'VE TALKED ABOUT THIS PREVIOUSLY.
IT IMPACTS OUR ABILITY TO, TO BORROW MONEY JUST LIKE IT IMPACTS, UH, PRIVATE BUSINESS AND CONSUMERS AS WELL.
BUT HERE IN, IN RESPONSE TO THE INFLATION ISSUES THAT I JUST DESCRIBED, THE FEDERAL RESERVE PUSHED ITS, UH, FEDERAL, UM, FUNDS RATE TO A 23 YEAR HIGH, BETWEEN FIVE AND FIVE, FIVE AND A QUARTER TO FIVE POINT A HALF PERCENT IN JUST 16 MONTHS.
SO FROM BETWEEN MARCH OF 2022 AND JULY OF 20, THIR 2023, UM, THE, THE, THE, THE, UM, THE, UH, RATE WAS RAISED TO A 23 YEAR HIGH, AND IT HAS NOT MOVED FOR 12 MONTHS.
THAT IS A, A SERIOUS CONSIDERATION ON, ON, UH, THE ECONOMY AND WHERE WE'VE SEEN IT MOST IMPORTANTLY, UM, AND WHAT REALLY IMPACTS, UM, OUR LOCAL ECONOMY MORE THAN ANYTHING, IS THE PRIME RATE, BECAUSE THE PRIME RATE IS WHAT BANKS CHARGE THEIR MOST CREDIT WORTHY CUSTOMERS.
UH, IT'S NOT, YOU CAN, FOR, FORGET ABOUT THE FEDERAL RATE FOR A SECOND.
THE PRIME RATE IS REALLY WHAT OUR BUSINESSES ARE PAYING TO BORROW MONEY AND TO MAKE INVESTMENTS.
AND YOU CAN SEE HERE, AS IN JULY OF 22, AS INFLATION HIT THAT 9%, UM, AND THE FEDS REALLY BEGAN TO TWEAK THEIR RATE, THE PRIME WEIGHT HAS GONE, UM, JUST EXCEEDINGLY HIGH.
NOW, UH, EVEN TODAY, STILL 8.5%.
I CAN'T TELL YOU HOW MANY DEVELOPERS I'VE TALKED TO, MANY OF THE ZONING CASES THAT YOU'VE HEARD AND THE PROJECTS THAT YOU'VE ENTITLED THE PAST TWO YEARS HAVE BEEN NON-STARTERS, ONLY BECAUSE THE PROFORMA THAT WAS ORIGINALLY, UH, WORKED WITH A FOUR AND HALF TO FIVE POINT A HALF PERCENT INTEREST RATE FOR CONSTRUCTION LOAN CAN'T POSSIBLY WORK WHEN IT'S 8.5 AND 9%.
UM, I CAN TELL YOU, WE COULD TALK ABOUT FOUR PROJECTS RIGHT NOW THAT IF THE INTEREST RATE DROPS TO 4.5%, WE WILL ALMOST INSTANTLY LAUNCH.
AND THAT'S THE KIND OF IMPACT THAT IT'S HAVING ON OUR NEW CONSTRUCTION STARTS, CAPITAL INVESTMENTS DOWN.
UM, UH, IMPORTANTLY, EXISTING DEBT FOR BUSINESSES IS BECOMING MUCH MORE EXPENSIVE, UM, FOR, FOR THEM TO SERVICE.
THAT'S LEADING INTO A DEVALUATION OF A LOT OF ASSETS, PARTICULARLY IN THE COMMERCIAL REAL ESTATE MARKET.
AND I'LL SHARE SOME MORE INSIGHTS INTO THAT.
AND THEN AGAIN, JUST, UH, FROM AN INVESTMENT STANDPOINT FOR BUSINESSES, UH, NO BUSINESS WANTS TO BORROW TO INVEST AT A HIGHER RATE, BUT WHEN THERE'S SO MUCH UNCERTAINTY AROUND THE RATES MOVING FORWARD, IT HAS, IT REALLY HAS A, A, A, A WHOLE NOTHER, UH, IMPACT.
SO HOW HAVE BUSINESSES AND CONSUMERS REACTED? UH, WELL, OBVIOUSLY, BOTH THE INFLATION AND HIGHER INTEREST RATES HAVE LED TO LESS SPENDING IE DECREASE IN OUR SALES TAX AND LESS INVESTMENT.
IE DECREASE IN OUR, BOTH OUR BPP AND OUR, OUR OUR, UH, REAL PROPERTY VALUE, UM, UH, PROPERTY, UH, TAXES.
UM, THE MAYOR AND I, AS WELL AS OUR AN ECONOMIC DEVELOPMENT DEPARTMENT HAVE AN OPPORTUNITY THROUGH THE MAYOR NINTH THROUGH OUR BUSINESS, OUR MAYORS, UH, UH, LUNCHES ON A MONTHLY BASIS THROUGH OUR BUSINESS RETENTION AND EXPANSION PROGRAM VISITS.
WE HAVE A AN OPPORTUNITY TO TALK TO A LOT OF, UH, BUSINESSES HERE IN RICHARDSON, BOTH BIG AND SMALL.
UM, I CAN SAY CONSISTENTLY OVER THE LAST YEAR, THESE BUSINESSES ARE REPORTING, UM, THAT THEY'RE ALMOST PAUSED.
THEY'RE POSTPONING ANY KIND OF SIGNIFICANT INVESTMENT, UH, ANY KIND OF SIGNIFICANT CAPITAL BECAUSE THEY'RE LOOKING FOR THESE IMPORTANT INDICATORS TO STABILIZE, IF NOT START TO RETREAT, AND TO BE MORE ACCEPTABLE IN, IN, IN LINE WITH THEY'RE ACCUSTOMED TO SPENDING FOR THEIR BUSINESS, UH, INVESTMENT.
AND BECAUSE THEY'RE LOOKING FOR MORE FAVORABLE CONDITIONS OVERALL FROM, UH, FROM THE ECONOMY.
UM, RECESSION IS A REAL, UM, IS A REAL CONSIDERATION FOR BUSINESS TODAY AND THEIR, AND, AND THEIR INVESTMENT.
BUT I'LL TELL YOU THE, THE, THE POLITICAL VOLATILITY IN THIS COUNTRY IS AFFECTING BUSINESS AND BUSINESS INVESTMENT, REGARDLESS OF WHO YOU HOPE WINS.
UH, IN NOVEMBER AT THE, AT THE FEDERAL LEVEL, THE UNCERTAINTY AROUND THINGS LIKE, WHAT WILL THE MONETARY POLICY OF THE NEXT ADMINISTRATION BE? WHAT WILL THE POLICY AROUND CERTAIN, UH, SECTORS SUCH AS OIL MANUFACTURING OR GREEN INITIATIVES BE? WILL WE HAVE GOVERNMENT SHUTDOWNS AND WILL BUSINESSES THAT HAVE LARGE GOVERNMENT CONTRACTS BE IMPACTED? ALL OF THESE THINGS ARE ON THE MINDS OF OUR BUSINESS LEADERS IN OUR COMMUNITY AND NORTH TEXAS.
IT'S IMPACTING, UM, THEIR ACTIONS, AND IT'S CAUSING THEM TO PAUSE AND POSTPONE IMPORTANT DECISIONS, AND THAT'S HAVING A RIPPLE EFFECT, UM, ON, ON OUR, UH, SALES AND PROPERTY TAX.
SO LET'S TALK ABOUT SALES AND PROPERTY TAX JUST A LITTLE BIT.
UM, BOB'S GONNA COVER THIS IN, IN MORE DETAIL, BUT I WANNA LET YOU KNOW THAT THE ESTIMATE THAT WE'RE USING FOR FY 25 IS 3.1% LESS, UM, THAN THE ESTIMATE WE HAVE ON HOW WE'LL FINISH FY 2324.
NOW, YOU'RE ACCUSTOMED AT THE, AT, AT A BUDGET RETREAT TO HEARING US SAY THAT WE'RE PROJECTING 2% MORE REVENUE THAN WE WILL ACTUALLY FINISH THE PRIOR YEAR WITH.
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IS, UH, VERY CONSERVATIVE, BUT IT'S, IT'S WHERE WE NEED TO BE, IN MY OPINION, AT, AT THIS TIME.UM, WE NEED TO SEE, UM, STABILIZATION IN OUR SALES TAX RECEIPTS FOR A QUARTER OR MAYBE EVEN AS MUCH AS A HALF YEAR BEFORE WE CAN, UM, GET A LITTLE BIT MORE BULLISH ON SALES TAXING AND CHANGE OUR THINKING AROUND THIS.
UM, WE HAVE, UH, IN, IN OUR BUDGET TODAY, UM, THE WAY IT'S GOING TO BE PRESENTED, WE HAVE A RESERVE, IF YOU WILL, SET ASIDE THAT IN CASE WE CONTINUE TO MISS OUR SALES TAX ESTIMATE IN THE COMING YEAR.
WE HAVE SOME DOLLARS SET ASIDE TO ADDRESS THAT.
IF, IF THAT BE THE CASE, IF NOT, BY ABOUT MIDYEAR OR SO, I CAN COME BACK TO YOU AND I CAN, UH, TALK TO YOU AND WE CAN HAVE A CONVERSATION ABOUT HOW THAT RESERVE WOULD BE DEPLOYED OTHERWISE.
BUT, UM, WITH THE CONSECUTIVE NATURE OF MONTH AFTER MONTH AFTER MONTH, NOT HITTING SALES TAX PROJECTIONS, WE FEEL LIKE THIS IS THE MOST PRUDENT WAY TO MOVE FORWARD.
SO ABOUT HALF A, ABOUT, UH, FIVE MONTHS OR SO INTO, UH, THIS BUDGET YEAR, SEEING MONTH AFTER MONTH OF, UH, SALES TAX RECEIPTS, NOT MEETING THEIR PROJECTIONS, WE DECIDED TO BRING IN SOME CONSULTING ASSISTANTS TO HELP US BETTER UNDERSTAND EXACTLY WHAT WAS, UH, WHAT WAS GOING ON.
AND, UM, SO WE, UH, THE, THE CONSULTANT, UH, UH, CONDUCTED ANALYSIS ON 134 TAXPAYERS.
NOW, YOU MAY SAY THAT'S NOT A LOT OF TAXPAYERS WHEN YOU HAVE OVER 12,000 TAXPAYERS, BUT THOSE A HUNDRED AND TWENTY, A HUNDRED THIRTY FOUR TAXPAYERS ACCOUNT FOR 60% OF ALL THE TAXES, SALES TAXES THAT WE COLLECT.
SO THOSE 134 TAXPAYERS ARE INCREDIBLY IMPACTFUL AND UNDERSTANDING, UM, HOW, UH, THEY, THEIR FARING AND, AND, AND, UH, THEIR COLLECTIONS.
UM, AND, AND WHAT'S BEHIND THEM, WE FELT WOULD BE VERY, UH, SUFFICIENT.
SO THE FIRST FINDING WE HAD, UM, WAS THAT, UM, SALES TAX RELATED TO TECHNOLOGY PURCHASES HAD DRAMATICALLY, UM, FALLEN OFF.
NOW, AGAIN, WHEN YOU THINK ABOUT SOME OF THE SLIDES I SHARED WITH YOU BEFORE, AND THE, YOU KNOW, ONE AND A HALF TRILLION DOLLAR INJECTION OF FEDERAL SPENDING THAT OCCURRED, UH, IN 2020, IT, IT SHOULDN'T SURPRISE US MUCH THAT THE COMPANIES IN OUR CITY THAT PROVIDE TECHNOLOGY, PARTICULARLY HARDWARE, HAD A VERY LARGE RAMP UP TIME THROUGH COVID, UH, SALES WERE, UM, UH, JUST ABOUT EVERY COMPANY, EVERY SCHOOL DISTRICT, EVERY CITY, EVERY ENTITY WAS BUYING MORE HARDWARE BECAUSE FOLKS HAD TO WORK REMOTELY, AND WE HAD TO GET, WE HAD TO GET ACCUSTOMED TO A WHOLE NOTHER WAY OF DOING BUSINESS.
AND SO WHAT YOU SEE HERE IN THE MONTHS FOLLOWING, UM, THAT, THAT 2020, UH, INDICATION THERE, WHERE THE RED LINE IS, IS PART OF THAT INCREASE EACH OF THOSE YEARS WAS THIS UPTICK IN TECHNOLOGY, UM, IN A VERY SHORT PERIOD OF TIME.
NOW, WHAT'LL BE INTERESTING BECAUSE, UH, A LOT OF THIS TECHNOLOGY IS STILL BEING DEPLOYED AND STILL BEING UTILIZED TODAY, IT MAY NOT BE UTILIZED 100%.
FOR INSTANCE, LIKE, UH, THE LAPTOP THAT I HAVE, UH, IF, IF I WAS WORKING CO, IF I WAS WORKING 100% REMOTE IN COVID, UH, DURING COVID, I MAY NOT BE DOING THAT ANY LONGER, BUT MOST ORGANIZATIONS ARE STILL HAVING SOME KIND OF REMOTE WORK, UH, POLICY.
AND SO A LOT OF THAT TECHNOLOGY IS STILL INTEGRAL TO THOSE BUSINESSES, UM, CONDUCTING CONDUCTING BUSINESS.
SO WHAT'LL BE INTERESTING IS WHEN THE REFRESH HAS TO OCCUR, BECAUSE, YOU KNOW, EVEN HERE IN OUR OWN CITY OPERATIONS, ALL OF OUR, UH, TECHNOLOGY IS ON A THREE TO FIVE YEAR CYCLE, DEPENDING ON WHAT IT IS.
SO YOU SEE THAT THREE TO FIVE YEAR CYCLE COMING, RIGHT? BECAUSE A LOT OF THIS INFRASTRUCTURE, THIS TECHNOLOGY WAS PURCHASED IN LATE 2021, MAYBE EVEN EARLY 22.
SO WE'LL HAVE TO WATCH THAT CLOSELY.
UM, THE REASON I WANNA WATCH THAT CLOSELY, THE REASON WE WANNA WATCH THAT CLOSELY IS BECAUSE WE MAY NEED TO ADJUST FOR THAT.
UM, WE MAY NEED TO TAKE SOME OF THAT INTO CONSIDERATION, ALMOST LIKE WE DO DO ON A MONTHLY BASIS WHEN WE HAVE AN AUDIT ADJUSTMENT FROM THE, FROM THE, FROM THE, UM, STATE, WE MAY WANT TO START CONTROLLING FOR SOME OF THE UPS AND DOWNS ASSOCIATED WITH SOME OF OUR INDUSTRIES.
ANOTHER GREAT EXAMPLE OF THAT IS WHAT WE FOUND TO BE A SECOND CAUSE IT'S SALES TAX RELATED TO INSURANCE CLAIMS. NOW, WHAT I'VE GOT HERE IS A LITTLE, A LITTLE SEGMENT, UH, KIND OF BARRED OFF HERE.
BETWEEN 2020, UH, JANUARY OF 2020 AND DECEMBER OF 2022, UH, THERE WERE 30 DIFFERENT BILLION DOLLAR, UH, SEVERE WEATHER DISASTERS IN TEXAS ALONE.
AND SO WHAT WE FOUND IS THAT A GREAT DEAL OF SALES TAX WAS BEING GENERATED BY INSURANCE COMPANIES NOT BEING ABLE TO HANDLE THIS KIND OF WORKLOAD.
SO HAVING TO GO OUT AND CONTRACT WITH ADJUSTERS AND OTHER INSURANCE PROFESSIONALS TO COME IN AND AUGMENT THEIR EFFORTS, THOSE CONTRACTUAL RELATIONSHIPS HAVE SALES TAX ASSOCIATED WITH THEM.
NOT, NOT ONLY THAT, BUT IF YOU JUST THINK ABOUT WINTER STORM URI, EVERYBODY IN THIS ROOM WAS IMPACTED, AND EVERYBODY IN THIS ROOM PROBABLY COULD NAME 10 FRIENDS AND FAMILY MEMBERS THAT HAD DAMAGE OCCUR.
ALL OF THOSE REPAIRS GENERATED SALES TAX, RIGHT? AND SO, ANOTHER AREA WHERE WE MIGHT NEED TO REALLY BE MINDFUL IN THE FUTURE, AND WE WILL BE VERY MINDFUL OF THE IN FUTURE AND SEEING, UH, IF THINGS ARE OUT OF THE ORDINARY,
[00:25:01]
IF SOME, IF YOU HAVE A, A YEAR WHERE IT'S JUST A, JUST DISPROPORTIONATELY A SIGNIFICANT AMOUNT OF EVENTS, WE MIGHT CONTROL FOR THAT.AND IN THE FOLLOWING YEAR, TAKE THAT INTO CONSIDERATION, UM, AS WE'RE DOING OUR SALES TAX ANALYSIS.
AND THEN THE FINAL IMPACT HERE IS CONSTRUCTION RELATED SALES TAX.
THIS WILL BE NO SURPRISE TO ANYONE, EVERYTHING THAT WE'VE ALREADY TALKED ABOUT BECAUSE, BUT MORE SO BECAUSE WE DRIVE AROUND THE CITY.
UM, IN 28 YEARS, I'VE NEVER SEEN FEWER CONSTRUCTION PROJECTS, UM, AT UNDER, UNDER CONSTRUCTION AT ANY GIVEN TIME.
THE THREE MAJOR CONSTRUCTION PROJECTS THAT ARE UNDER CONSTRUCTION RIGHT NOW ALL STARTED, UH, THEIR FINANCING AND THE DEALS, UH, UH, MAKING WAS ALL DONE PRIOR TO COVID.
THEY JUST HAPPENED TO GET STARTED SUBSEQUENT TO COVID, THE CONSTRUCTION, AND THEY'RE UNDERWAY AS A RESULT.
UM, NEW CONSTRUCTION STARTS THROUGHOUT THE UNITED STATES OR DOWN, UM, HERE IN NORTH TEXAS.
UM, YOU CAN DRIVE AROUND ANY COMMUNITY.
UM, AND, AND WHEREAS IN, YOU KNOW, 15 THROUGH 19 YOU SAW CRANES LITERALLY EVERY, EVERY TURN YOU MADE.
UM, NOW THEY'RE, THEY'RE JUST, THEY'RE JUST FEW AND FAR BETWEEN, IF, IF REALLY ANYWHERE.
AND SO WE'VE SEEN A SIGNIFICANT REDUCTION IN SALES TAX FROM, UM, UM, FROM THE, OR SIGNIFICANT REDUCTION IN SALES TAX FROM THE CONSTRUCTION MARKET AS WELL.
UM, THE, THE FINAL DISCUSSION I WANT TO HAVE IS JUST AROUND OUR OFFICE MARKET ITSELF.
UM, RIGHT NOW IN THE US THE OFFICE VACANCY, AS YOU CAN SEE HERE, IS 19 ALMOST 20%.
UM, THAT'S COMPARED TO, UH, HALF OF THAT, ABOUT 9% IN 2019 PRE COVID.
UH, THE FIRST QUARTER OF 2024, YOU SEE ABOUT 102 MILLION SQUARE FEET.
UM, WERE, WERE LEASED NATIONWIDE.
THAT'S ABOUT 10% BELOW THAT SAME TIME PERIOD.
UM, IN 2019, TEXAS, UH, HOUSTON, DALLAS AND THEN AUSTIN ARE THE FIRST, SECOND AND THIRD MOST VACANT OFFICE MARKETS IN THE WHOLE TOP 50 METROPOLITAN AREAS IN THE UNITED STATES.
NOW, THAT'S NOT BECAUSE THERE'S NOT A LOT OF ACTIVITY IN THESE CITIES, IT'S BECAUSE IN TRUE TEXAS STYLE, WE OVERBUILT AND BECAUSE A LOT OF THE BUILDING OCCURRED IN THE EIGHTIES AND NINETIES, AND A LOT OF THOSE BUILDINGS ARE NOW CONSIDERED CLASS B BUILDINGS, THEY'RE NOT DESIRABLE, UM, BY TENANTS WHO ARE FIRST AND FOREMOST WANT THE BEST BUILDING ON THE BLOCK WITH THE BEST AMENITIES, THE BEST FINISH OUTS, BECAUSE THEY WANT TO ATTRACT THEIR TALENT BACK TO THE OFFICE.
THEY WANT TO INCENTIVIZE THEM OR ENTICE THEM BACK TO THE OFFICE.
THEY DON'T WANT TO MANDATE IT.
THIS IS THE FLIGHT TO QUALITY, UH, VALUE PROPOSITION THAT WE HEAR SO MUCH ABOUT IN THE DFW MARKET.
IF YOU LOOK AT, UM, UH, IF YOU LOOK AT BUILDINGS THAT ARE OLDER THAN 2015, UM, SINCE COVID, THEY'VE LOST ALMOST 18 MILLION SQUARE FEET OF SPACE.
BUILDINGS THAT ARE NEWER THAN 2015 HAVE GAINED ALMOST 14 MILLION SQUARE FEET.
UM, THIS WAS IMPORTANT, UH, DATA THAT WE WERE ABLE TO GATHER EARLIER THIS YEAR WHEN WE WERE, WHEN WE WERE KIND OF PERFECTING OR REFINING, IF YOU WILL, OUR COMMERCIAL REAL ESTATE STRATEGY.
BUT MORE IMPORTANTLY, THIS DATA WAS, UM, VALIDATED AND CONFIRMED BY, UH, LITERALLY DOZENS OF CONVERSATIONS THAT WE HAD WITH COMMERCIAL BROKERS AND LENDERS HERE IN NORTH TEXAS.
UM, THE FIGHT, THE FLIGHT TO QUALITY IS REAL, AND WE HAVE TO CONSIDER WHAT WE'RE GONNA DO WITH OUR CLASS B OFFICE BUILDINGS, UM, OR WE WILL CONTINUE TO SEE, UH, THE OFFICE REAL ESTATE MARKET HAVE A DOWNWARD IMPACT ON OUR PROPERTY TAXES.
UM, THE SECOND BIG ISSUE THAT WE NEED TO BE REALLY MINDFUL OF IS THE, UH, OFFICE MARKET LOAN DEFAULTS.
UM, TODAY, UH, RATES ARE EXTREMELY PROBLEMATIC FOR, UH, CURRENT OWNERS, UM, WHO GENERALLY WILL BORROW AT LEAST 50% OF THE VALUE OF THEIR BUILDING.
UM, THE LEASES THAT ARE BE GONNA BE COMING UP BETWEEN, SAY, TODAY IN THE NEXT THREE YEARS, MOST OF THOSE LEASES WERE PRE COVID LEASES.
AND SO THOSE LEASES WERE ENTERED INTO WHEN A PROPERTY OWNER HAD BORROWED, UH, 50% OF THE VALUE OF THAT BUILDING AT A FRACTION OF THE INTEREST RATE THAT THEY ARE TODAY.
THEY ALSO HAD BUILDINGS THAT WERE FULLER AND THEY WERE GETTING MORE PRICE PER SQUARE FOOT BECAUSE THERE WAS MORE COMPETITION.
AS WE SEE OWNERS NOW AND LEASES EXPIRING, UM, BUSINESSES ARE RIGHT SIZING, UH, THEY KNOW THEY DON'T NEED THE AMOUNT OF SQUARE FEET THAT THEY HAD BEFORE BECAUSE THEY HAVE HYBRID WORK MODELS, AND EVEN, EVEN THOSE THAT HAVE A MAJORITY OF THEIR, UM, UH, OF THEIR CUT, UH, OF THEIR EMPLOYEES COMING INTO WORK ARE WORKING DIFFERENTLY NOW.
UM, AND THEY WANT DIFFERENT CONFIGURATIONS.
UM, THE THE PROBLEM THAT WE'RE GONNA HAVE HERE IS THAT OWNERS ARE GOING TO CONTINUE TO STRUGGLE, UH, TO FIGURE OUT THIS SITUATION AND, UH, LIKE HAS ALREADY HAPPENED AS A RESULT OF THIS DILEMMA, UH, OVER A HUNDRED MILLION DOLLARS IN OFFICE LOAN DEFAULTS IN THE UNITED STATES TO DATE AS A RESULT OF THIS.
AND WE'VE GOT ANOTHER TWO TO THREE YEARS OF THIS, UM, BECAUSE THAT'S WHEN YOU'RE FINALLY GONNA WORK THROUGH ALL OF THE PRE COVID LEASES.
THEY'RE GONNA EXPIRE, AND THEN WE'RE GONNA HAVE A NEW SETTING,
[00:30:01]
IF YOU WILL.WE'RE GONNA RESET AND WE'LL BE ABLE TO MOVE FORWARD, BUT WE'RE GOTTA, WE HAVE TO WORK THROUGH THIS, UH, CYCLE.
UM, THE IMPACT THAT THIS HAS IS THAT A LOT OF THE OLDER OFFICE, A LOT OF THE CLASS B OFFICE, A LOT OF WHAT OUR OFFICE, OUR OFFICE INVENTORY IS MADE OF HAS REALLY BECOME, IT'S, IT'S, IT'S UNCON ECONOMICAL AND, AND IT'S UNDESIRABLE AS A RESULT.
AND SO THAT'S GOTTA BE DEALT WITH, AND IT HAS TO BE INFORMED.
I MENTIONED TO YOU THE IMPACT, BOB, YOU'RE GONNA SEE THIS SLIDE AGAIN IN MORE DETAIL, BUT BOB'S GONNA COVER IT, UH, FROM DIFFERENT PERSPECTIVES.
I JUST WANNA SHOW YOU, COMMERCIAL OFFICE SECTOR VALUES ARE DOWN 9.4%.
AND THIS BUDGET, I ANTICIPATE THAT FOR EACH OF THE NEXT TWO YEARS, OR THEM MAYBE EVEN THAT DOWNTURN BEING EVEN HIGHER.
SO WE'VE GOTTA COMBAT THIS PROBLEM WITH OTHER STRATEGIES AND OTHER SECTORS, BUT WE ALSO HAVE TO COMBAT THE COMMERCIAL REAL ESTATE ISSUE HEAD ON.
UM, YOU SEE HERE, UNDER THE PRIOR TAXES, THERE ARE STILL MANY, UM, UM, UH, PROPERTY VALUE DISPUTE LAWSUITS OUT THERE THAT HAVE TO BE RESOLVED IN RICHARDSON, AND MANY OF THOSE ARE AROUND THE COMMERCIAL SECTOR, UM, BECAUSE OF THE SITUATIONS, UH, THAT WE'VE JUST DESCRIBED.
SO, WHAT I WOULD WANNA KNOW IF I WERE IN YOUR SHOES, OR IF I WAS A CITIZEN OF RICHARDSON, IS WHAT ARE WE GONNA DO ABOUT IT? IT'S NOT THE RICHARDSON WAY TO SIT BACK AND SAY, WE HAVE THESE ECONOMIC CYCLES, WE HAVE THESE, UM, REAL ESTATE CYCLES, AND WE JUST HAVE TO WORK THROUGH 'EM.
UH, INSTEAD, UH, WHAT WE'VE DONE IS WE'VE CREATED A NUMBER OF STRATEGIES THAT I BELIEVE ALLOW US TO GO HEAD ON AND TO REALLY, UM, WITHIN THE CONTEXT THAT WE CAN CONTROL, DEAL WITH, UM, SO MANY OF THESE FACTORS, UM, THAT ARE BEYOND OUR CONTROL.
SO, UM, THE, THE REAL ESTATE AND FLEX OFFICE STRATEGY THAT I WANNA SHARE WITH YOU JUST QUICKLY, UH, AS A WAY OF COMBATING, UH, THESE ISSUES AND TRYING TO IMPROVE BOTH OUR SALES AND PROPERTY TAX SITUATION AS WE MOVE FORWARD, UH, REALLY BEGIN BACK WITH THE ADOPTION OF THE ECONOMIC DEVELOPMENT STRATEGY IN 2023.
AS I MENTIONED TO YOU, WE SPENT A GREAT DEAL OF TIME, UM, ONE-ON-ONES FOCUS GROUP MEETINGS, UM, BROKER DEVELOPER LUNCHEONS, UM, TAKING FEEDBACK AND PERFECTING THIS STRATEGY.
THE FIRST PIECE OF THE STRATEGY IS THAT WE HAVE GOT TO REINVENT OUR OUTDATED OFFICE, UH, INVENTORY ARE IN BUILDINGS.
UM, WE NEED TO CREATE PLACES WHERE TALENT WANTS TO BE BECAUSE IF WE CAN CREATE PLACES WHERE TALENT WANTS TO BE, BUSINESSES WILL WANNA LOCATE THERE.
AND SO WE NEED TO GO OUT, WE NEED TO REPLACE OUTDATED OFFICE BUILDINGS, UM, THAT PROBABLY WILL NEVER COMPETE IN THIS MARKET AGAIN WITH HOUSING, RESTAURANTS, AND ENTERTAINMENT.
AND WE NEED TO ENCOURAGE THAT REDEVELOPMENT.
IT'S ALREADY HAPPENING IN RICHARDSON.
UM, AS WE'VE BEGAN TO BROADCAST THIS TO THE DEVELOPMENT COMMUNITY EARLIER OF THESE, THIS YEAR, WE HAVE TWO GREAT EXAMPLES OF THIS.
ONE BY LAYING PARTNERS, ONE 11, UH, WEST SPRING VALLEY, AND ONE BY, UH, JLB 25 20 NORTH CENTRAL EXPRESSWAY.
BOTH OF THESE BUILDINGS WERE CLASS, UH, B OFFICE, AND THAT'S PROBABLY BEING A LITTLE KIND.
BOTH OF THESE BUILDINGS WERE CLASS B OFFICE THAT WERE, UH, IN SOME CASES GETTING ABOUT $6 A SQUARE FOOT, UH, FOR THEIR LEASE THEY HAD NOT BEEN INVESTED IN, IN YEARS.
UM, THEY WERE, THEY WERE APPEALING TO THE DEVELOPMENT COMMUNITY FOR, FOR A COUPLE OF REASONS.
ONE, THEY WERE, THEY WERE CENTRALLY LOCATED TO A RED LINE STATION.
TWO, THEY WERE RIGHT ON THE, UH, CENTRAL TRAIL, EASY CONNECTIVITY, EASY MOBILITY, UM, AND THEN THREE, THEY HAD, UM, EXISTING, UM, AMENITIES, RETAIL, RESTAURANTS, SERVICES, ALL, ALL AROUND THEM TO BUILD ON.
AND SO WE WERE ABLE TO TAKE OUT, UH, 80,000 SQUARE FEET.
UH, UH, BOTH OF THESE BUILDINGS HAVE BEEN DEMOLISHED.
UH, THE PLANS ARE IN PLACE IN AS SOON AS THE INTEREST RATES, UH, A BOTH OF THESE PROJECTS WILL LAUNCH.
UM, THESE, WERE ON BOTH OF THESE BUILDINGS.
WERE ON THE TAX ROLL FOR $5.7 MILLION, $5.7 MILLION.
THE ESTIMATED VALUE OF THE TWO NEW PROJECTS WILL BE $130 MILLION.
WE NEED TO REPLICATE THIS AS MANY TIMES AS WE CAN, AND WE'LL START NOT ONLY COMBATING SOME OF THE NATIONAL FACTORS THAT ARE IMPACTING THE COMMERCIAL REAL ESTATE MARKET, WE'LL START TURNING THE SHIP AND WE'LL START TURNING DIRECTIONS.
AND AT, AT MINIMUM, WE WILL MITIGATE THE IMPACT THAT THESE NATIONAL FACTORS WILL HAVE ON US LOCALLY.
THE SECOND STRATEGY IS TO REINVEST IN STRATEGIC OFFICE BUILDINGS.
WE NEED TO CREATE CLASS A ASSETS, CLASS A PLUS ASSETS OUT OF EXISTING BUILDINGS THAT ARE STRATEGICALLY LOCATED BECAUSE THEY HAVE PLACES AROUND THEM, BUT THE OWNERS HAVE LACKED THE VISION, AND THE OWNERS HAVE LACKED THE COMMITMENT.
WE NEED TO EXCITE THOSE OWNERS, AND WE NEED TO PARTNER WITH THEM.
UM, THIS IS AN EXAMPLE OF, UH, GALLATIN COMMONS.
THIS IS BUILDING C UM, YOU CAN SEE THE PICTURES UP TOP THERE.
THIS BUILDING WASN'T UPDATED FOR 10 YEARS.
THE, THE, UH, TENANT HAD OCCUPIED IT FOR, UH, 10 YEARS, AND THEN HAD RECENTLY MOVED OUT.
THAT BUILDING COULD HAVE BEEN MARKETED ALL DAY, EVERY DAY, AND THEY COULD HAVE PRACTICALLY GIVEN THE LEASE AWAY, AND NO ONE WOULD'VE MOVED IN THAT BUILDING BECAUSE OF THE CONDITION OF IT.
IT'S NOT APPEALING TO BUSINESSES TODAY.
IT'S NOT WHAT TALENT WANTS, WHERE TALENT WANTS TO WORK.
WE PARTNERED WITH THE OWNER WHO HAD A VISION.
[00:35:02]
IN THE COMMON AREAS.HE INVESTED $8 MILLION IN CREATING THE STAIRWAY AND REMOVING, UH, OPENING THE SECOND FLOOR AND CREATING, UH, COMMON AREAS THAT WERE ATTRACTIVE AND CREATING HALLWAYS THAT WERE OPEN AND SPACIOUS AND, AND RESTROOMS WHERE PEOPLE WOULD FEEL COMFORTABLE AND THEY'D WANT TO, THEY'D FEEL WELCOME THROUGHOUT THE WHOLE BUILDING.
UM, WE HELPED THE OWNER WITH THIS PROJECT BECAUSE WE BELIEVE THE GALLATIN COMMONS AREA, UM, IS A GREAT PLACE.
IT HAS THE WILDFLOWER FESTIVAL, IT HAS THE RENAISSANCE, IT HAS THE, UM, UH, EISMAN CENTER.
IT HAS HOUSING WHERE, WHERE FOLKS CAN WALK ACROSS, YOU KNOW, WORKERS CAN WALK ACROSS FROM THEIR HOME.
THESE ARE THE KIND OF PROJECTS WE NEED TO FOCUS ON.
UM, THERE ARE, THERE ARE NUMEROUS, UH, SEVERAL ACTIVE LEASES, UH, ON THIS BUILDING RIGHT NOW, AND I THINK PROBABLY WITHIN A VERY SHORT PERIOD OF TIME, WE'LL BE MAKING ANNOUNCEMENTS AS A RESULT.
COLLINS CROSSING IS ANOTHER GREAT EXAMPLE IN THE RICHARDSON IQ, A HIGH PRIORITY AREA.
UM, UH, NEW OWNER BOUGHT THE PROPERTY ABOUT A YEAR AGO, IMMEDIATELY BEGAN REINVESTING, IMMEDIATELY BEGAN PLANNING A MULTIFAMILY, UH, PROJECT JUST TO THE NORTH THAT WOULD COMPLIMENTED IT, COMPLIMENT THE BUILDING AND COMPLIMENT THE, UH, VISION FOR THE IQ, PARTICULARLY, UH, THE, UM, THE GREENVILLE CORRIDOR THERE, UM, ALMOST IMMEDIATELY STARTED PAYING DIVIDENDS FOR HIM.
UM, YOU CAN SEE THERE, SINCE JANUARY OF THIS YEAR, UM, HAS SIGNED ALMOST 92,000 SQUARE FEET IN LEASES.
NOW, THIS IS, IN SPITE OF EVERYTHING WE JUST TALKED ABOUT, THIS IS A AMAZING WIN IN THE FIRST SIX MONTHS OF JAN OF, UH, 2024, THE BUILDING'S NOW 93% OCCUPIED.
IN SHORT TIME, WE'LL BE ANNOUNCING THE 78,000 SQUARE FOOT LEASE.
UM, I CAN TELL YOU THE 70,000 SQUARE FOOT, 78,000 SQUARE FOOT LEASE, AND NEXT PERIA ARE BOTH TARGET INDUSTRIES IN OUR ECONOMIC DEVELOPMENT PLAN.
THEY'RE BOTH SEMICONDUCTOR MANUFACTURING COMPANIES, AND THEY'RE BOTH PUTTING RESEARCH AND DEVELOPMENT, UH, SHOPS RIGHT HERE IN THE IQ BECAUSE THEY LIKE WHAT WE'RE DOING, AND THEY WANNA BE PART OF THAT ECOSYSTEM.
AND THEN, UH, CHES MA HOMES WAS ANOTHER TENANT THAT REACH THAT RECENTLY MOVED IN, WHICH I THINK IS GREAT.
I THINK YOU NEED, I THINK A GOOD BUILDING LIKE THIS WILL HAVE A DIVERSE, UH, SET OF BUSINESSES, NOT JUST BE HYPER-FOCUSED ON ONE INDUSTRY, BUT A GREAT EXAMPLE OF WHAT AN OWNER WITH VISION SUBSEQUENT, UH, YOU MAY HAVE READ IN, IN THE PAPER, SUBSEQUENT TO ANNOUNCING THESE 92,000 SQUARE FEET AND LEASES, THEY ANNOUNCED THEY WERE GONNA BE INVESTING EVEN MORE, UH, IN THE BUILDING BY ADDING A, UM, A RESTAURANT AND A, ALMOST LIKE A SMALL CONVENIENCE STORE FOR, UH, THE EMPLOYEES AND FOR O UH, ULTIMATELY THE, THE RESIDENTS THAT'LL LIVE IN THE ADJACENT, UH, UH, MULTI-FAMILY DEVELOPMENT.
THEN THE FINAL PARTS TO THIS, UH, PIECE, WHICH I'M REALLY EXCITED ABOUT, IS REDUCING THE TENANT IMPROVEMENT GAP.
UM, WHAT THIS COMES DOWN TO IS WHAT I WENT GOING BACK TO THE FLIGHT TO QUALITY.
WHAT BUSINESSES WANT TO MOVE INTO A BUILDING TODAY IS THEY WANNA HAVE THE HIGHEST QUALITY FINISHES.
THEY WANNA HAVE THE MOST AMENITIES.
THEY WANNA HAVE A PLACE WHERE THAT, THAT EXCITES THEIR EMPLOYEES TO COME.
THE PROBLEM WITH THAT IS THAT THEY'RE ASKING FOR ANYWHERE FROM 80 TO A HUNDRED DOLLARS A SQUARE FOOT FOR THESE IMPROVEMENTS.
AND AN OWNER AS HE LOOKS TO WHAT THEY MAY BE ABLE TO AMORTIZE OVER THE, THE, THE SPAN OF A SEVEN OR A 10 YEAR LEASE CANNOT PAY THAT.
AND SO OUR STRATEGY IS FOR STRATEGIC COMPANIES THAT ARE IN OUR TARGET INDUSTRIES THAT CAN ADD VALUE AND EVEN, AND, AND EVEN DRAW MORE, UM, BUSINESS TO THE AREA WE ARE HELPING, UH, OWNERS AND TENANTS WITH BY, BY BUYING DOWN, UH, THE, UH, TENANT IMPROVEMENT ALLOWANCE AND HELPING THEM CLOSE THE GAP.
WE'VE HAD GREAT SUCCESS ON THIS.
THE INTERESTING THING ABOUT THIS SLIDE IS THAT THESE ARE ALL ANNOUNCEMENTS THAT HAVE BEEN MADE SINCE JANUARY OF 2024, BUT ONLY HALF OF THEM, ONLY 50% OF THEM RECEIVED AN INCENTIVE FROM THE CITY.
AND I WOULD ARGUE THAT THE REASON THE OTHERS CAME WAS BECAUSE OF THE STRATEGIC WORK WE DID IN THE INCENTIVE WORK THAT WE DID WITH THE OTHER 50%.
BUT YOU CAN SEE HERE, UH, UH, TWO, UH, HEADQUARTERS MOVING FROM, UH, DALLAS AND FARMERS BRANCH RESPECTIVELY, AND SOCIA AND X EXCEL PRO STAFFING TO RICHARDSON, UH, CELESTICA EXPANDING A 30,000 SQUARE FOOT MANUFACTURING OF, UH, DEFENSE, UH, CONTRACTS, UH, NEXT RANGE STUDIOS, UH, A LEADER IN CYBERSECURITY SOFTWARE.
UH, FAST PHOTONICS, A LEADER IN ALL THINGS, UM, UM, UM, UH, RESEARCH AND DEVELOPMENT AND MANUFACTURING AROUND LIGHT, LIGHT TECHNOLOGY.
UM, AND THEN OTHERS, UH, UH, UH, ALSO JOINING, AND THIS IS NOT A COMPLETE LIST OF THE, UH, UH, PROJECTS THAT WE WORKED ON, BUT I WANTED TO MAKE THE POINT OF, AS WE LEVERAGE THE INCENTIVES AND ECONOMIC DEVELOPMENT WORK WE DO, THERE REALLY IS A MULTIPLIER EFFECT.
AND BUSINESSES WANT TO BE AROUND OTHER INNOVATIVE BUSINESSES.
THEY WANT TO BE AROUND POTENTIAL PARTNERS AND COLLABORATORS.
AND SO WE ARE BEING VERY STRATEGIC AND THE TENANT IMPROVEMENT WORK THAT WE DO, UM, AND WE'RE TRYING TO MAXIMIZE THE BENEFIT OF THAT BY, UH, MAKING SURE WE PARTNER WITH THE RIGHT, UH, COMPANIES.
BUT COMMERCIAL REAL ESTATE ISN'T THE ONLY AREA THAT WE NEED TO WORK ON.
UM, WE DIDN'T TALK ABOUT THE IMPACT OF THIS SPECIFICALLY TO THE PROPERTY TAXES, BUT, UM, COMING OUTTA YOUR CITY COUNCIL SESSIONS,
[00:40:01]
UH, IN 20 TH 2023, THE GOAL SESSIONS, RETAIL IS A HIGH PRIORITY PRIORITY.AND I KNOW THAT, UH, WE SIMILARLY, EARLIER THIS YEAR, MET WITH STAKEHOLDERS AND OTHER, UM, FOCUS GROUPS AND CAME UP WITH A STRATEGY, UH, FOR RETAIL AS WELL.
UM, FIRST AND FOREMOST IS TO REINVENT OUR LEGACY SHOPPING CENTERS.
AND THE MOST IMPORTANT PIECE, UM, IN, IN MY OPINION IN THIS STRATEGY IS TO GET THE SHOPPING CENTERS IN THE HANDS OF LOCAL OWNERS AND DEVELOPERS.
I'M GONNA SHOW YOU THREE EXAMPLES OF THAT, WHERE THEY WERE PREVIOUSLY IN THE HANDS OF A REAL ESTATE INVESTMENT TRUST OR A REIT.
AND IN ONE CASE, THE SHOPPING CENTER HAD FALLEN INTO 50% OCCUPANCY BECAUSE THE REIT HAD PAID LITTLE TO NO ATTENTION TO IT.
IT WAS A READ OUT OF PHILADELPHIA.
UM, AND NOW WITH A LOCAL OWNER, WE'VE, IT'S ALREADY BACK UP TO 92% OCCUPANCY.
SO WE NEED TO, WE NEED TO STRATEGICALLY WORK TO GET THESE SHOPPING CENTERS INTO THE HANDS OF LOCAL DEVELOPERS WHO CARE ABOUT THE COMMUNITY.
THEY HAVE A VISION, A PROVEN VISION, AND THEY HAVE PROVEN, UH, RETENANTING STRATEGIES TO IMPROVE THE QUALITY OF THE TENANTS IN THE CENTER.
AND, AND THE DIVERSITY, AGAIN, REIN, REINVESTING IN SITE, AND BUILDING FACADES.
A LOT OF THESE LEGACY CENTERS, UM, NEED, UM, TO HAVE UPDATING TO THE BUILDING MATERIALS.
UH, THEY HAVE COMPLIANCE ISSUES WITH THINGS LIKE A DA, THEY HAVE NEW REGULATIONS THEY HAVE TO MEET.
THEY MAY HAVE OUTDATED SIGNS AND SIGNED PACKAGES, AND SO IT'S IMPORTANT TO WORK ON ALL THOSE.
AND THEN WE NEED TO REDUCE OBSTACLES AS WELL FOR RESTAURANTS AND, UH, AND OTHER SERVICE PROVIDERS IN ENTERTAINMENT VENUES TO REACH THEIR FULL VISIONS.
JUST LIKE THE, UH, TENANT IMPROVING COSTS ARE IMPACTING THE COMMERCIAL SECTOR, THEY'RE SIGNIFICANTLY IMPACTING, UM, THE, UH, RETAIL AND RESTAURANTS, PARTICULARLY SMALL, LOCALLY OWNED BUSINESSES.
UM, I CAN'T TELL YOU HOW MANY TIMES AN UNEXPECTED GREASE TRAP, OUR UNEXPECTED FIRE SUPPRESSION SYSTEM HAS ALMOST COST US A SMALL BUSINESS FROM OPENING.
AND SO WE NEED TO BE OUT PROACTIVELY, UM, HELPING THEM ACHIEVE THEIR FULL VISION BY ASSISTING, UH, PARTICULARLY ON SMALL, LOCALLY OWNED BUSINESSES.
THE THREE EXAMPLES I WANTED TO SHOW YOU FIRST WAS EAST SIDE PRECISION INVESTMENTS AS NOW IN POSSESSION OF EAST SIDE.
IT WAS PREVIOUSLY, UH, IN POSSESSION OF THAT PHILADELPHIA REIT, SEVEN YEARS IN THE POSSESSION OF THE REIT, AND IT HIT DROPPED TO 50%, UH, OCCUPANCY, UH, IN A LITTLE OVER A YEAR.
UH, PRECISION HAS BROUGHT THAT BACK UP TO 92%.
THEY BROUGHT IN THE ICON, THE PEACH COBBLER, OPEN SESAME BOMBAY REPUBLIC, AND THERE'S TWO OTHER SPACES THAT THEY, THEY CURRENTLY HAVE LETTERS, UH, OF INTENT ON, WHICH WOULD BRING 'EM TO A HUNDRED PERCENT, AND THEY DID THAT IN A YEAR.
SHOP COMPANIES AT PROMENADE NORTH SHOP COMPANIES IS THE COMPANY THAT WE PARTNERED WITH, UH, TO REINVENT CANYON CREEK PLAZA, THE NORTHWEST CORNER OF US 75.
WE TOOK A C AND M TIRE SHOP, AND WE BROUGHT IN A VELVET TACO.
WE TOOK OUT A LUBIES, AND WE BROUGHT IN A SNUFFERS AND A TORCHY'S AND A MINT ASIAN.
THAT CORNER IS, IS, UM, THE HIGHEST PER SQUARE FOOT RETAIL IN THE CITY NOW, AND THAT'S WHAT SHOP COMPANY CAN DO AT PROMENADE.
THEY'VE ALREADY, UH, AGREED, UH, UH, TO, TO OUR, UH, INITIAL AGREEMENT FOR A MINIMUM OF A $1 MILLION INVESTMENT IN PHASE ONE.
THEY BROUGHT IN CIVIL, POOR HI SPORTS AND MR. MAX JAPANESE RESTAURANTS.
IF YOU'RE NOT FAMILIAR WITH MR. MAX, UM, LATER THIS YEAR, UM, WHEN THE, UM, OH GOSH, WHEN THE BEARD AWARD FOLKS COME TO TA DALLAS, THEY WILL LIKELY BE AWARDED, THIS IS THEIR SECOND LOCATION, AND THEY ARE ONE OF THE MOST LIKELY, UM, IN NORTH TEXAS TO RECEIVE A, UH, AN A, A DESIGNATION.
AND THEY'RE RIGHT THERE IN THE PROMENADE AND SHOP BROUGHT, HAS BEEN WORKING WITH THEM.
AND THEN MOST RECENTLY, VERY, VERY EXCITED BY THIS JAH REALTY.
UM, AGAIN, TONS OF VISION, A HISTORY OF REINVENTING LEGACY CEN CENTERS, UM, WORKED WITH THEM CLOSELY ALL THROUGHOUT THE ALAMO, UPS AND DOWNS.
THEY NEVER GAVE UP ON THE CENTER.
AND, UH, LITERALLY ONE WEEK AFTER, UM, ALAMO CORPORATE, UM, RECEIVED AND TOOK POSSESSION OF THE NORTH DALLAS LOCATIONS.
JAH CLOSED ON RICHARDSON HEIGHTS AND, UH, HAS BIG PLANS FOR IT, AND, AND WE WILL BE WORKING WITH THEM.
BUT JUST AN INDICATION OF HOW, UM, HOW MUCH, UM, LOCAL OWNERS WHO NOT ONLY CARE ABOUT THE BOTTOM LINE, BUT ALSO CARE ABOUT THE COMMUNITY CAN MAKE A DIFFERENCE.
AND I BELIEVE WE NEED TO CONTINUE.
UM, THESE BUSINESSES AREN'T JUST BUSINESSES.
THESE BUSINESSES ARE REAL SALES TAX DOLLARS.
THEY'RE REAL IMPROVEMENTS IN THE CENTERS THAT'LL RESULT IN REAL PROPERTY TAX DOLLARS, UH, REAL, UH, BPP DOLLARS, AND THEY'RE MEANINGFUL.
UM, JUST TO KIND OF LOOKING AHEAD ON AND EVERYTHING, AND KIND OF CONCLUDING THIS SECTION OF THE PRESENTATION, UM, I THINK TO THE RIGHT HERE, UM, THIS IS A GREAT INDICATION.
ALL OF THESE HEADLINES WERE FROM TODAY, AND THEY ARE, UH, WE COULD HAVE DONE TWO SLIDES OF THESE, AND EVERY, IT WOULD'VE BEEN AS DIVERSE AS YOU COULD FIND.
UM, WE ARE LIVING IN A VERY DYNAMIC TIME, BOTH ECONOMICALLY REAL ESTATE POLITICALLY.
UM, I BELIEVE, UM, OUR JOB IS TO MANAGE
[00:45:01]
THE VERY BEST WE CAN AND TO BE PROACTIVE IN THAT MANAGEMENT.IN SPITE OF ALL THESE FACTORS.
WE CANNOT WORRY ABOUT WHAT'S HAPPENING EVERYWHERE ELSE.
WE GOTTA FOCUS ON WHAT'S HAPPENING HERE.
WE HAVE TO DEAL WITH THE CIRCUMSTANCES THAT WE'RE PRESENTED, AND WE HAVE TO MANAGE AND BE RESPONSIVE TO THOSE.
UH, I STRONGLY BELIEVE THAT NORTH TEXAS IS GONNA CONTINUE TO BE A DRIVING FORCE IN THE WORLD'S ECONOMY.
THERE'S NOT A BETTER PLACE, UM, IN MY MIND TO BE, AND THERE'S NOT A BETTER CITY IN MY MIND TO BE.
UM, I DO WANNA BE EYES OPEN WITH YOU, AND I HAD FIVE MEETINGS LAST WEEK, UH, WITH OUR CITY STAFF, FIVE DIFFERENT TOWN HALL BUDGET MEETINGS, AND I SAID THIS TO CITY STAFF.
WE HAVE A NUMBER OF YEARS COMING THAT THE COMMERCIAL REAL ESTATE, UH, MARKET WILL LIKELY IMPACT THE DECISIONS THAT WE HAVE TO MAKE.
THERE'S GONNA BE DEFAULTS, THERE'S GONNA BE LEASES THAT ARE RENEWED FOR HALF THE SQUARE FEET, OR A FRACTION OF THIS PRICE PER SQUARE FOOT.
AND ALL OF THAT IS GOING TO IMPACT THE VALUE OF THAT COMMERCIAL PROPERTY.
AND COLLECTIVELY, THAT COULD HAVE IMPLICATIONS FOR OUR PROPERTY TAXES AND WHAT WE ARE ABLE TO COLLECT.
SO WE'VE GOTTA BE EXTREMELY MINDFUL OF THAT.
I MENTIONED EARLIER, WE HAVE TO BE EXTREMELY VIGILANT AND WE HAVE TO SEE SALES TAX STABILIZE, AND NOT JUST FOR A MONTH OR TWO.
WE NEED TO SEE A QUARTER OR A HALF YEAR, UM, BEFORE WE START TO REACT.
THE ONE THING I AM CERTAIN OF, EXCUSE ME, IS WHEN THESE CONDITIONS DO STABILIZE, WE ARE GONNA BE POSITIONED, AND I THINK IS STRONGLY AS ANY MUNICIPALITY HERE IN NORTH TEXAS TO BE, UH, ABLE TO REBOUND AND TO BE ABLE TO RESPOND AND TAKE ADVANTAGE OF THE OPPORTUNITIES THAT PRESENT THEMSELVES IN THOSE EARLY DAYS OF THAT RECOVERY BECAUSE OF THE THINGS THAT WE'RE DOING NOW, BECAUSE OF THE MARKET TRENDS THAT WE'RE LEVERAGING, 'CAUSE OF THE RELATIONSHIPS THAT WE'RE BUILDING.
UM, AND BECAUSE OF THE, THE, OUR ABILITY TO CLEARLY TO COMMUNICATE THOSE VISIONS, UM, I'M EXTREMELY PROUD OF THE FEEDBACK THAT WE'RE GETTING FROM THE DEVELOPMENT WORLD.
UH, THEY UNDERSTAND THAT WE GET IT.
UM, THE BIGGEST CONCERN I HAVE IS THAT SOME OTHER CITY'S GONNA TRY TO TAKE OUR IDEAS AND TRY TO COPY OR EMULATE WHAT WE'RE DOING.
UM, THEY WON'T DO IT AS GOOD, BUT THEY MAY.
UM, BUT THAT IS OUR RESPONSE TO THESE VERY TRICKY TIMES.
NOTWITHSTANDING ALL THAT, I WANTED TO LET YOU KNOW THAT OUR KEY FOCUS AREAS, UM, CONTINUE TO, TO SUSTAIN.
UM, OBVIOUSLY ONE OF THE DRIVERS, UH, I WOULDN'T HAVE WENT THROUGH IT IF IT WASN'T, WAS THE CURRENT AND, AND ANTICIPATED ECONOMIC FACTORS, BUT YOUR GOALS AND STRATEGIES, YOUR FEEDBACK DURING OUR DEEP DIVES.
UH, MY ASSESSMENT, AGAIN, OF THE ORGANIZATION AND, UH, HOW WE CAN, UM, BETTER SERVE OUR COMMUNITY.
UH, OUR BOARDS AND COMMISSION INPUT IS SO VERY IMPORTANT TO US THROUGHOUT THE YEAR AND DURING THE BUDGET TIME.
OUR HOMEOWNERS AND NEIGHBORHOOD ASSOCIATIONS WHO WE MEET WITH 10 TIMES A YEAR, UH, AS PRESIDENTS AND LITERALLY DOZENS OF TIMES A YEAR IN THEIR OWN MEETINGS AND THE INPUT THAT THEY PROVIDE ARE INSTITUTIONAL PARTNERS.
OUR BUSINESS AND DEVELOPMENT COMMUNITY, AS I'VE MENTIONED, UM, THE PLANS THAT WE ADOPT AND THE, AND, AND, UH, THE SPECIAL INITIATIVES, UH, THAT WE LAUNCH AND THAT HAVE TO BE, UH, NOT ONLY LAUNCHED BUT CONTINUALLY WORKED AND BROUGHT TO FRUITION.
AND THEN THE CITY ASSESSMENTS AND EVALUATIONS THAT WE DO, THE, THE INFRASTRUCTURE ASSESSMENTS WE DO, UH, FOR INSTANCE.
AND THEN THE EXTERNAL ASSESSMENTS THAT WE DO WITH PARTNERS LIKE TEXT DOT, ALL OF THESE, UH, ROLL UP AND INFLUENCE OUR, UM, OUR KEY FOCUS AREAS.
I'LL TELL YOU THAT, UM, THIS YEAR, IN ADDITION TO RECRUITMENT AND RETENTION OR PEOPLE, UH, PUBLIC SAFETY AND INFRASTRUCTURE, I'VE ADDED ECONOMIC DEVELOPMENT, UM, BECAUSE OF THE, THE CONSIDERATIONS THAT WE'VE DISCUSSED.
UM, I PRESENTED THIS SLIDE IN THE PAST, AND I'LL BE HAPPY TO REPORT THAT IT'S IMPROVING.
UM, THERE WAS A TIME WHERE, UH, YOU HAD ALMOST, UH, 50 PER 50, UH, OUT OF EVERY A HUNDRED WORKERS THAT WE NEEDED HERE IN TEXAS.
THAT NUMBER NOW, ACCORDING TO THE US CHAMBER OF COMMERCE AT THE END OF MAY, HAS JUMPED TO EIGHT, BUT EIGHT OUTTA 10 WORKERS, UH, STILL MAKES IT AN EXTREMELY COMPETITIVE ENVIRONMENT HERE IN NORTH TEXAS.
AS A RESULT, WE'VE DONE A NUMBER OF THINGS.
UH, ACTUALLY WE'VE DONE A LOT OF THINGS BECAUSE YOU'VE SUPPORTED THE RECOMMENDATIONS AND SUGGESTIONS.
NONE OF THESE WOULD'VE BEEN POSSIBLE WITHOUT YOUR SUPPORT.
I'M NOT GONNA GO THROUGH 'EM, I'LL JUST HIT A COUPLE OF THEM.
THE MARKET ADJUSTMENTS OVER THE PAST COUPLE YEARS HAVE BEEN SO VERY IMPORTANT, UH, TO ALLOW US TO RECRUIT, PARTICULARLY THE MOST DIFFICULT TO RECRUIT POSITIONS.
THE LIVING WAGE, WHICH I THINK IS, IS SO IMPORTANT.
AND THE SALARY, UH, COMPRESSION ISSUES THAT WERE, UH, UH, CREATED WHEN WE INCREASE THOSE, UH, THOSE EMPLOYEES THAT ARE OUT THERE DRIVING DAY AFTER DAY AND, UH, PAYING, UM, SO MUCH MORE FOR FUEL TODAY OVER WHEN THEY FIRST GOT THEIR ALLOWANCES, WE ADDRESSED THOSE, THE INCREASE IN LONGEVITY PAY AS A RE AS A RETENTION TOOL.
UM, AGAIN, SOME OTHER, UH, STRATEGIES AROUND, UH, SPECIFIC DEPARTMENTS.
UH, THE EN ENHANCED RETIREMENT, UH, ELIGIBILITY FROM 25 TO 20 YEARS WAS HUGE, PARTICULARLY IN THE PUBLIC SAFETY, UH, REALM, UH, AND OTHER, UH, UH, BENEFITS AS YOU SEE THERE.
AND THEN THE WORK LIFE BALANCE, ALL OF THESE THINGS I'M HAPPY TO REPORT ARE HAVING A GOOD IMPACT.
THEY'RE HAVING A POSITIVE IMPACT.
AND OUR SITUATION, UH, IS IMPROVING NOTWITHSTANDING, UM, THE, THE, THE, UH, STATISTICS THAT I PRESENTED YOU EARLIER AROUND THE AVAILABILITY OF WORKFORCE, UH, THROUGH THE FIRST, UM, I GUESS 10 MONTHS HERE OF THIS YEAR
[00:50:01]
COMPARED TO LAST YEAR.YOU CAN SEE WE'RE UP ALMOST 300 APPLICATIONS.
BUT LET ME TELL YOU A LITTLE BIT ABOUT WHAT YOU SEE THERE.
IN JULY OF AUGUST OF LAST YEAR, IF YOU CONTROL FOR THE FACT THAT WE WERE HIRING 18 FIREFIGHTERS, THE NUMBER IS ACTUALLY A LOT.
THE DIFFERENCE IS ACTUALLY A LOT HIGHER.
YOU CAN ACTUALLY TAKE OUT ALMOST 300 APPLICANTS THERE OUT OF THAT 600, UH, 6,264.
SO YEAR TO DATE, WE'VE, UH, WE, WE'VE GOT OVER 500 MORE APPLICANTS, UM, YEAR TO DATE.
AND WE'VE HAD FEWER POSITIONS POSTED, FEWER POSITIONS AND FEWER, UH, FEWER, UM, PLACE OR FEWER, UM, SPOTS IN EACH OF THOSE POSITIONS.
AND WE'RE SEEING AN INCREASE AND THE MOST DIFFICULT TO, UH, UH, FIND FILL POSITIONS.
YOU SEE SOME POSITIONS DOWN SIGNIFICANTLY, LIKE CUSTODIAN SOLID WASTE LOADER.
THOSE ARE GOOD THINGS BECAUSE THOSE POSITIONS ARE FULL.
THE WORK THAT YOU'VE DONE ALLOWING, PARTICULARLY ON THE LIVING WAGE, ON THE, THE LOWEST SALARIED POSITIONS THAT WE HAVE, THE WORK THAT YOU'VE ALLOWED US TO DO, AND THE POLICIES AND, AND COMP PLANS YOU'VE ALLOWED US TO PUT INTO PLACE IS HAVING A GREAT IMPACT.
UM, YOU CAN SEE SOME OF THE OTHER AREAS, UH, POLICE OFFICER, UH, 9 1 1 OPERATOR ALSO FALLING OFF.
AND I'LL TALK A LITTLE BIT ABOUT WHY THAT IS AND WHY IT'S A GOOD THING HERE SHORTLY.
UM, IF YOU LOOK AT OUR VACANCY RATE, UM, IT'S FINALLY STARTING TO COME DOWN TO WHAT LOOKS LIKE A RICHARDSON RATE.
UH, YOU KNOW, PRE, UH, PANDEMIC, IT WAS, WE WOULD ALWAYS HOVER RIGHT AROUND 5%.
AND, YOU KNOW, I WOULD ARGUE FOR ANY ORGANIZATION OF A THOUSAND PLUS EMPLOYEES, THAT'S JUST NORMAL ATTRITION.
UM, YOU CAN'T, YOU CAN'T AVOID THAT.
UM, NOW WE'RE AT 7% IF, IF YOU KIND OF CONTROL FOR A PUBLIC SAFETY.
UM, BUT A, A BIG IMPROVEMENT, UM, OVER, UH, THE PAST COUPLE YEARS, THAT 7%.
UM, AS YOU, AS YOU CAN SEE THERE AMOUNTS TO 30 TO 40 POSITIONS DEPENDING ON THE YEAR.
30 TO 40 POSITIONS MORE WE HAVE FILLED TODAY THAN WE HAD FILLED BACK IN 2022, FOR INSTANCE.
UM, WHAT ABOUT THE DEPARTMENTS WE'VE HAD THE BIGGEST STRUGGLES WITH? I WANNA START OFF WITH POLICE 'CAUSE THIS IS A HUGE SUCCESS STORY.
EVERYTHING FROM THE SIGN-ON BONUSES TO THE LATERAL PAY TO ALL THE OTHER, UH, PROGRAMS THAT WE'VE PUT IN PLACE.
WE HAVE ONE VACANCY FOR 9 1 1 OPERATORS.
THAT NUMBER WAS AS HIGH AS 13.
IT WAS 50% OF THE, OF THIS, UH, THE NOT FULL-TIME, 9 1 1 OPERATORS AT ONE TIME.
AND THAT VACANCY JUST BECAME, UM, UM, AN ISSUE LAST WEEK.
WE COULD HAVE, IF WE'D HAVE DONE THIS PRESENTATION TWO WEEKS AGO, IT WOULD'VE BEEN ZERO.
UM, LOOK AT POLICE OFFICER FOUR.
WE WERE AS HIGH AS 18 POSITIONS VACANT AT ONE TIME.
TWO OF THOSE POSI, TWO OF THOSE FOUR, AGAIN, REALLY RECENTLY.
ONE DECIDING, UM, TO TAKE A DIFFERENT POSITION THAN THE POLICE DEPARTMENT THAT BETTER ALIGNED WITH, UH, KIND OF WHAT, WHAT HIS, HIS, UH, KIND OF LONG-TERM CAREER GOALS.
AND THE OTHER, UM, UH, JUST, JUST, UH, LEAVING FOR LEAVING FOR DIFFERENT, UH, REASONS.
BUT THIS IS A 5.2% VACANCY AND PD IS ALL ATTRIBUTED TO WHAT YOU'VE ALLOWED US TO DO, AND SOMETIMES TO TRY OVER THE PAST COUPLE YEARS, IT'S A HUGE, UH, IMPROVEMENT, A HUGE, HUGE IMPROVEMENT.
BUT SOME DIVISIONS WAS STILL STRUGGLING.
YOU SEE PUBLIC SERVICES, IT'S STILL VERY DIFFICULT TO FIND MANUAL LABOR FOR, UH, WASTEWATER.
UH, SEWER OPERATIONS, FOR INSTANCE, IS STILL VERY DIFFICULT TO FIND.
UM, OUR RESIDENTIAL DRIVER LOADERS, UM, DIFFERENT THAN THE DR THAN THE LOADER THAT WE TALKED ABOUT WHERE THAT'S ALL THEY ALL THEY DO.
AND SO WE STILL HAVE OUR WORK TO DO.
UH, IT'S STILL VERY DIFFICULT TO FIND MECHANICS AND FLEET TECHNICIANS, ALSO FACILITY, UH, TECHNICIANS.
SO ANYTHING THAT REQUIRES, UH, THE TRADES, IF YOU WILL, AND THE TECHNICAL TRAINING, UM, WHICH IS WHY SOME OF THE WORKFORCE DEVELOPMENT THAT'S HAPPENED IN THE COMMUNITY IS SO IMPORTANT.
UM, AND THEN OF COURSE, UM, THAT GOES FOR BUILDING INSPECTION AS WELL.
UH, SOME OF THESE COMBINATION INSPECTORS THAT WE'VE BEEN TRYING TO FIND THAT CAN, UH, BOTH DO, UH, SAY FOR INSTANCE, ELECTRICAL AND MECHANICAL INSPECTING, OR MECHANICAL AND PLUMBING INSPECTING.
UM, THEY'RE JUST FEW AND FAR BETWEEN.
UM, AND SO THAT CONTINUES TO BE A HIGH AREA OF FOCUS.
NOW, NOTWITHSTANDING THAT, UM, NOTWITHSTANDING THAT SUCCESS THAT WE'VE HAD, AND IT IS SUCCESS, THERE'S NO DOUBT ABOUT IT.
IT'S BEEN SUCCESS OVER THE LAST COUPLE YEARS.
UM, RETENTION IS STILL A HUGE ISSUE FOR US.
WE CANNOT, UH, WE CANNOT, IN MY OPINION, LET UP ON RETENTION.
NOT BECAUSE WE, ONE, WE'VE SPENT A LOT OF RESOURCES ATTRACTING THOSE PEOPLE THAT I JUST MENTIONED TO YOU.
THE COST TO PUT A POLICE OFFICER ON THE STREET, UH, IN TERMS OF TRAINING AND A FIREFIGHTER ARE BOTH OVER A HUNDRED THOUSAND DOLLARS.
UM, THINK ABOUT THAT WHEN WE GET TO THE COMPENSATION SLIDE, 'CAUSE I WANNA BRING THAT BACK TO LIGHT.
HOWEVER, WE ALSO HAVE TWO DAY, WE HAVE 272 OF OUR 1000 PLUS EMPLOYEES WHO ARE ELIGIBLE TO RETIRE TODAY, WITHIN TWO MORE YEARS, THE END OF 2026, THAT NUMBER WOULD JUMP UP TO ALMOST A THIRD OF OUR FULL-TIME EMPLOYEES CAN RETIRE.
NOW, YOU MIGHT SAY, WELL, WAS THAT TO DO WITH GOING FROM 25 TO 20 YEAR RETIREMENT? IT'D BE A VERY FAIR QUESTION.
IT WASN'T ONLY 70 OF THOSE HAVE, ARE
[00:55:01]
ELIGIBLE NOW BECAUSE THEY, WE WENT FROM 25 TO 20 YEAR RETIREMENT.AND I WOULD STILL SAY THAT THAT WAS ESSENTIAL TO DO 'CAUSE IT WAS A BIG OBSTACLE IN THE PUBLIC SAFETY RECRUITMENT.
THIS IS ALSO AN IMPORTANT RETENTION CONSIDERATION.
UM, THE INSTITUTIONAL KNOWLEDGE, UH, THE EXPERIENCE THAT THESE FOLKS HAVE, HAVE TO BE TRANSFERRED AND THEY HAVE TO HAVE TIME WITH.
AS YOU CAN SEE, UM, NEARLY 47% OF OUR STAFF WITH LESS THAN FIVE YEARS PER EXPERIENCE NOW.
AND SO I WANT TO CONTINUE TO FOCUS ON RETENTION, NOT ONLY FOR THOSE NEW EMPLOYEES THAT WE INVEST IN, BUT BECAUSE WE HAVE LONG-TERM EMPLOYEES WHO CAN ADD GREAT VALUE AND HAVE, UH, WHO CAN HELP THIS TRANSITION, THIS ORGANIZATION TRANSITION, UM, MORE EFFECTIVELY.
SO LET'S TALK ABOUT PUBLIC SAFETY COMP JUST FOR A SECOND.
YOU'RE VERY FAMILIAR WITH THESE, UH, THESE, THESE CHARTS.
UM, ON THE, UH, FIRST, UH, TO THE LEFT, THERE YOU SEE THE RANK AT MINIMUM.
THAT'S WHERE WE RANK OUT OF, UM, THE, THE SURVEY CITIES THAT WE COMPARE OURSELVES TO.
AND THEN YOU SEE THE PERCENT BELOW.
THE FOURTH RANK IS, UM, OUR, OUR ASPIRATIONAL GOAL OF ALWAYS BEING IN THE, THE TOP, UH, UH, FOUR, UH, FOR PAY ON MINIMUM AND MAXIMUM SALARIES FOR, FOR PUBLIC SAFETY.
UH, AND, UH, FOR, UH, NON-PUBLIC SAFETY.
UH, YOU CAN KIND OF SEE WHERE, UH, THIS IS SHAKEN OUT.
THIS IS NORMAL AND CUSTOMARY, UH, BECAUSE, UH, WE ENACT OUR TEN ONE CHANGES.
AND THEN OTHER, UH, UH, CITIES, UH, WILL ENACT DIFFERENT, UH, CHANGES FOR THOSE AGENCIES.
AND SO THIS IS WHERE WE STAND TODAY, ALWAYS REMIND, UM, OUR PUBLIC SAFETY EMPLOYEES, UH, REMIND THE COMMUNITY.
IT'S ALWAYS GONNA BE A POINT IN TIME, AND WE ALWAYS HAVE TO JUST BE MINDFUL OF THAT.
UH, YOU CAN SEE ON THE MAXIMUM THERE, AGAIN, FALLING, UH, MORE SO THAN WE DID ON THE MINIMUM, UH, ON THE POLICE SIDE AND ON THE FIRE SIDE.
UM, WHEN IT COMES TO OUR GENERAL EMPLOYEE, UH, PAY SURVEY, YOU CAN SEE, UH, LIKEWISE HERE, UM, YOU SEE A LOT OF, UH, FIVES AND SIX AND SEVEN AND EIGHTS.
AND THERE YOU CAN SEE THE PERCENT BOTH BELOW MINIMUM AND MAXIMUM.
UM, AND, UM, SO WE HAVE A STRATEGY, UH, AROUND THIS AS WELL.
AND RECALL, UM, UH, NON-SWORN, UM, MOST NON-SWORN, UM, UH, PUBLIC SAFETY EMPLOYEES ARE ON, ARE NOT ON STEP PLANS AS WELL.
THERE'S SOME QUASI SWORN 9 1 1 OPERATORS, DETENTION OFFICERS, FOR INSTANCE, THAT ARE, BUT THE MAJORITY ARE NOT, UM, ON, ON STEP PLANS.
AND SO THEY FALL INTO THIS CATEGORY.
UH, THE LIVING WAGE THIS YEAR HAS BEEN PARTICULARLY, UM, UM, UM, PROBLEMATIC.
UM, AND IT'S, IT'S VERY FRUSTRATING TO ME 'CAUSE THIS IS VERY IMPORTANT.
UH, BUT THE LIVING WAGE JUMPED ALL THE WAY TO 2206, UH, AN HOUR FROM, UM, ABOUT 1872, IF I REMEMBER RIGHT.
UH, UM, AND, UM, AND, AND SO IT'S, IT'S A HUGE JUMP.
WE'VE LOOKED AT THIS EVERY WAY POSSIBLE.
YOU KNOW, IN EACH OF MY FIRST TWO BUDGETS, THIS WAS A HIGH PRIORITY FOR ME TO, TO MAKE THE FULL ADJUSTMENT ON THE LIVING WAGE.
IT'S SUCH A LARGE INCREASE, UM, THAT IT HAS A RIPPLE UP EFFECT AND CREATES COMPRESSION ISSUES THAT WE SIMPLY COULDN'T TAKE ON, UH, GIVEN THE, UH, REVENUE CONSTRAINTS THAT WE'LL DISCUSS AND THAT WE'LL GO INTO MORE.
AND SO, BUT IT IS VERY IMPACTFUL, DTC TO 150, FULL-TIME EMPLOYEES AND 179 PERMANENT PART-TIME EMPLOYEES.
SO WHAT IS MY RECOMMENDATION ON COMP YEAR? UM, I'M ESSENTIALLY RECOMMENDING A 3%, UM, UM, MERIT UP TO A 3% MERIT INCREASE, MERIT INCREASE FOR POLICE, FIRE, AND FOR GENERAL, UH, PURPOSE AND, UH, GENERAL, UM, UM, GOVERNMENT EMPLOYEES.
AND SO ESSENTIALLY WHAT'LL HAPPEN IS THE MINIMUM AND THE MAXIMUM ON THEIR, ON EVERY SALARY RANGE WILL BE INCREASED BY 3%, AND THEN AT THE EMPLOYEE WITHIN THE OPEN RANGE WILL BE ELIGIBLE FOR UP TO A 3% MERIT INCREASE.
AND AS YOU'LL SEE, THAT'LL TAKE CARE OF A LOT OF THE GENERAL GOVERNMENT, UM, ISSUES AS IT RELATES TO WHERE WE ARE RANKED.
UM, I'M ALSO RECOMMENDING TO YOU, UM, STEPS, UM, FOR BOTH POLICE AND FIRE.
NOW, YOU CAN SEE THERE THIS YEAR WE'VE DIFFERENTIATED, UM, IN THE POLICE DEPARTMENT, YOU ACTUALLY HAVE ONLY, UM, 62, UH, INDIVIDUALS THAT WILL RECEIVE STEPS BECAUSE THEY'RE, UH, IN, IN SERVICE OF FIVE YEARS OR LESS.
AND IN THE, UM, UH, UH, FIRE DEPARTMENT, YOU'LL HAVE 70, SO A TOTAL OF ONLY ABOUT 132 EMPLOYEES CITYWIDE THAT WILL ACTUALLY RECEIVE THE STEP.
BUT LET ME TELL YOU A LITTLE BIT ABOUT, ABOUT THE STEP PLAN AND WHY IT'S SO IMPORTANT.
SO AS I MENTIONED, UM, THIS IS ONLY FOR SWORN UM, UH, STAFF.
AND IF WE DID A FURTHER BREAKDOWN, YOU WOULD SEE THAT THE MAJORITY OF THOSE 70 AND THE MAJORITY OF THOSE, UH, 60, UH, TWO, UM, IS, AM I, YEAH, 62 IN THE POLICE DEPARTMENT, UH, ARE POLICE OFFICERS AND FIREFIGHTERS.
UM, AND, AND SO THEY, THEY ARE THE POSITION AS YOU MOVE UP IN THE RANKS, YOU DON'T, YOU DON'T HAVE AS MANY INCUMBENTS, AND SO YOU DON'T HAVE ANY ISSUES.
SO I MENTIONED TO YOU, IT COST US OVER
[01:00:01]
A HUNDRED THOUSAND DOLLARS TO BRING ON A NEW FIREFIGHTER, A POLICE OFFICER.UM, THE STRATEGY BEHIND HAVING THE STEPS FOR THE FIRST FIVE YEARS, UM, IS A RETENTION TOOL IN THAT INVESTMENT.
UM, ONE OF THE MAIN DRIVERS IN IN COMP COMPETITION IN NORTH TEXAS, UH, FOR, UH, PUBLIC SAFETY IS HOW QUICKLY DO THEY TOP OUT? WE HAVE THEM TOPPING OUT IN FIVE YEARS, WHICH IS ALSO THE YEAR THAT THEY BECOME VESTED WITH THE CITY.
IT'S ALSO THE YEAR THAT IN THEIR MIND THEY CAN SAY, HEY, I'M ACTUALLY NOW ONE QUARTER OF THE WAY TO THAT 20 YEAR RETIREMENT.
AND SO OUR EMPHASIS ON, UM, THESE EMPLOYEES IS, UH, REALLY MAKING SURE THAT THEY UNDERSTAND THAT THEY'RE APPRECIATED, THAT THEY'RE VALUED, AND THAT WE WANT THEM TO REMAIN PART OF OUR ORGANIZATION LONG TERM.
AND THE WAY THAT WE DO THAT IS THROUGH THE STEP SYSTEM.
IT WOULD BE MUCH MORE, UH, COSTLY OVER THE LONG TERM.
UH, AS YOU CAN SEE HERE, WITH JUST $500,000 TO ADDRESS ALL OF THOSE ISSUES, IT WOULD BE MUCH MORE, UH, COSTLY OVER THE LONG TERM.
UM, NOT TO, UH, HAVE A STRONG RETENTION STRATEGY FOR THESE INDIVIDUALS THAT WE INVEST SO MUCH MONEY INTO, AND TO HAVE A HIGHER TURNOVER, UM, IN, IN, IN THESE POSITIONS BECAUSE THEY WERE SIMPLY, UM, AT A YOUNG AGE AND NOT BE INVESTED HOPPING, UH, CITY TO CITY BECAUSE THEY WANTED TO MAKE A DOLLAR OR $2 MORE AN HOUR.
AND THAT IS WHAT HAPPENS, UH, IN SOME CASES.
UM, AND SO I FEEL LIKE THE STEP PLAN, UH, FOR PUBLIC SAFETY IS A VERY IMPORTANT COMPONENT TO OUR RETENTION STRATEGY.
UH, IT'S, UH, SOMETHING THAT IS EXTREMELY COMMON, UM, AND, AND, AND, UH, PUBLIC SAFETY.
AS A MATTER OF FACT, OUR DIRECTOR OF HOME HUMAN RESOURCES TODAY TOLD ME THAT HE DOES NOT KNOW ANY CITY, UM, IN TEXAS THAT IS NOT USING STEPS FOR PUBLIC SAFETY.
AND SO WE WOULD BE A REAL OUTLIER IF WE DIDN'T, IF WE DIDN'T DO THAT.
UM, ON THE, UM, UH, PAY PLAN ADJUSTMENT FOR, UM, THOSE, UH, EMPLOYEES THAT ARE MAKING A MINIMUM HOURLY WAGE, WE'RE PROPOSING TO TAKE THAT TO 1945 WITH THE COMMITMENT OF, UM, TRYING TO MAKE UP AND, UM, GET TO THE LIVING WAGE, UM, HOURLY WAGE AS QUICKLY AS WE CAN IN, IN, IN THE FUTURE, UH, HAVING TO BALANCE A LOT OF DIFFERENT PRIORITIES, BUT REALLY TRYING TO MAKE THAT A, MAKE THAT A PRIORITY.
AND AGAIN, ONE OF OUR BIGGEST OBSTACLES TO THAT IS NOT JUST THE FUNDING THAT WOULD BE REQUIRED FOR THAT CHANGE, IT'S ALSO THE RIPPLE UP EFFECT THAT THAT HAS THE COMPRESSION THAT IT CREATES.
UM, AND YOU QUICKLY GET INTO SOME VERY LARGE NUMBERS.
UM, UM, AS, AS A RESULT, IF YOU LOOK AT WHAT THAT 3% DOES, IT REALLY DOES A, UH, IT DOES IMPROVE OUR SITUATION FOR BOTH POLICE AND FIRE.
YOU CAN SEE NOW, UH, ON THE MINIMUM RANK FOR FIRE, I'M SORRY FOR POLICE ON, EXCUSE ME, ONLY SERGEANT, NOT IN THAT TOP FOUR.
UH, AND AGAIN, UM, YOU HAVE A POLICE OFFICER AS WELL AS SERGEANT AND CAPTAIN, UH, BUT LITERALLY 1% 0.7 AND 0.3% OUT OF THAT TOP FOUR.
UH, ON FIRE SIDE, IT'S A LITTLE, THE NUMBER'S A LITTLE HIGHER ON THE MINIMUM.
YOU STILL HAVE A LITTLE BIT, UH, PARTICULARLY ON THE ENTRY LEVEL FOR FIREFIGHTER, UH, BEING ABOUT THREE AND A HALF, EIGHT, THREE AND A HALF, UH, 3.8% BELOW.
BUT AS YOU GET TO THE MAXIMUMS, IT REALLY STARTS TO CURE.
NOW, I'LL TELL YOU, I'VE REVIEWED THIS WITH BOTH CHIEFS AND WITH, UH, BOTH OF OUR, UH, OUR POLICE ASSOCIATION AND FIRE ASSOCIATION.
THEY FULLY UNDERSTAND THE, THE BIGGER, UH, UH, BUDGET PICTURE THAT WE'RE DEALING WITH.
AND, UM, I FEEL CONFIDENT IN TELLING YOU THAT THEY'RE SUPPORTIVE OF THIS STRATEGY, UM, AND THAT THEY, UM, APPRECIATE, UH, EVERYTHING THAT THE COUNCIL HAS DONE THE PAST TWO YEARS.
AND, UM, IF THIS BE THE PROPOSAL THAT MAKES ITS WAY TO ADOPTION, I KNOW THAT THEY'LL BE VERY APPRECIATIVE OF THIS AS WELL.
AND THE GENERAL FUND EMPLOYEES YOU CAN SEE ALSO REALLY MAKES A, A BIG IMPACT.
UM, YOU CAN SEE NOW THE, THE PERCENT, UH, THERE, UH, BELOW, UH, MINIMUM RANKING, UH, FOR THE MOST PART, UM, IT REALLY DOES, UH, IMPROVE SITUATIONS.
NOW, I'LL TELL YOU, WE HAVE A VERY SMALL AMOUNT OF MONEY, BUT WE HAVE MONEY, UH, THAT WE'VE SET ASIDE, UM, FOR STRATEGIC MARKET ADJUSTMENTS.
SO FOR INSTANCE, UH, THE FACILITIES MAINTENANCE SUPERVISOR, I JUST TOLD YOU, WE HAVE A, WE HAVE A PROBLEM BOTH IN FLEET AND FACILITIES.
WE'LL PROBABLY COME BACK AND LOOK AT THAT NUMBER.
AND BASED ON MARKET, WE MIGHT TWEAK THAT NUMBER.
BUT WHOLESALE ACROSS THE BOARD CHANGES THE RANGES IN GENERAL.
UM, I THINK WE HAVE, UM, I'VE CHECKED ME ON THIS.
I THINK WE HAVE MAYBE ABOUT $40,000 OR SO FOR STRATEGIC MARKET ADJUSTMENTS.
SO IT'LL BE A VERY LIMITED NUMBER, BUT THEY'LL BE IN THE MOST DIFFICULT TO FILL POSITIONS, UH, IN THE MOST COMPETITIVE, UM, IN TERMS OF PUBLIC SAFETY, UH, OF COURSE, PUBLIC SAFETY CONTINUES TO BE, UH, A BIG PRIORITY FOR US HERE.
UH, BUDGETS OF NOW, UH, OVER 39 AND A HALF MILLION DOLLARS FOR PD, UH, OVER 32 MILLION FOR FIRE.
AND OF COURSE, EMERGENCY MANAGEMENT ON THE PD, UH, FRONT, I'M SORRY, I'LL START WITH FIRE HERE ON THE FIRE FRONT.
UM, IN THE CAPITAL REPLACEMENT FUND, WE HAVE THEIR COMMAND ONE COMMAND VEHICLE.
THIS IS, UH, THERE ARE FOUR COMMAND VEHICLES IN THEIR FLEET, EACH BEING REPLACED, UH, IN A ROTATION.
AND SO, UM, WE HAVE, UM, ACTUALLY, UH, 12, UH, OF
[01:05:01]
THESE LARGE THERMAL IMAGERS.AND THEN WE ACTUALLY HAVE, UM, I THINK, UH, CURTIS TOLD ME 40, UH, OF THE INDIVIDUALS AND THERMAL, UM, UH, IMAGE, UH, THERMAL IMAGERS ARE WHAT THEY USE WHEN THEY GO INTO A BUILDING AND THE SMOKE IS SO DENSE THAT THEY CAN'T SEE THROUGH.
AND SO EACH OF THE, UH, APPARATUS WILL HAVE, UM, UH, NOW TWO OF THESE THERMAL IMAGES IMAGERS, AND THEN THEY'LL HAVE 40, UH, FOR STAFF TO CARRY A HANDHELD, ALMOST LIKE A BODY CAMERA SIZE, IF YOU WILL, THAT THEY'LL HAVE, THAT THEY'LL BE ABLE TO CARRY ON ON THEIR, UH, ON, AS CURTIS WOULD SAY, ON THEIR PERSON.
UM, WE HAVE A, UH, ROTARY, UH, NUMBER.
UH, I THINK THERE WERE, UM, UH, LET'S SEE.
I THINK THERE WERE NINE ROTARY, UH, RESCUE SAWS, UH, FOR A TOTAL OF 15,000.
THESE ARE THE SAWS THAT CUT, UM, BOTH CONCRETE AND METAL.
AND, UH, THEY'RE NOT JAW, UH, THE JAWS OF LIFE, BUT THEY'RE SAWS THAT THEY, UH, OFTEN WILL USE IN CONJUNCTION WITH RESCUES.
UH, AND THEN THE POSITIVE PRESSURE VENTILATION FANS ARE WHAT THEY USE WHEN THEY, UH, WILL SET THE FAN AT THE FRONT DOOR OF A BUILDING TO BLOW OUT ALL THAT SMOKE AFTER, UM, THE, THE INITIAL.
AND THEN YOU SEE THE FIRE TRAINING CENTER NOW, UM, ITCHING UP TO 20 YEARS, BELIEVE IT OR NOT.
UM, SO THERE'S A, UH, A TOWER ROLLUP DOOR, UH, A MISTING FAN, AND THEN SOME BALCONY WORK THAT THEY WANT TO DO.
ALL THAT BEING PLA UH, PAID FOR WITH THE, UH, CAPITAL REPLACEMENT FUND, UH, STATION BAY IMPROVEMENTS.
UH, CURTIS DESCRIBED THESE AS, UH, SEVERAL IMPROVEMENTS AT DIFFERENT DAYS.
UH, A LOT OF, UM, UH, UH, MAINTENANCE THAT, UH, UH, HAS BEEN, UH, DEFERRED THAT, UH, JUST KIND OF GETTING THE BAYS UP.
AND THEN THE AERIAL PLATFORM TRUCK, THAT'LL BE AT STATION FOUR.
UH, AND THEN THE, UH, NEW MICU, UH, THAT'LL BE PUT INTO ROTATION.
UM, AND, UH, ONE WILL BE TAKEN OUT AND KEPT AS A RESERVE, UH, AS A RESULT ON THE POLICE SIDE, THERE ARE 14 VEHICLES, UH, OVER A MILLION DOLLARS.
THIS IS OUR GENERAL, UH, FLEET REPLACEMENT, UH, PATROL VEHICLES.
AND, UM, UH, PREDOMINANTLY, UM, THE FORENSIC IMAGING SYSTEM REPLACEMENT.
UM, THIS IS, UH, FOR THEIR CRIME LAB, BUT IT ALSO IS, UH, ADDING A PORTABILITY FEATURE TO IT.
THIS IS WHAT THEY CAN TAKE OUT TO USE TO, UM, IDENTIFY THINGS LIKE BLOOD, OR I'LL STOP THERE, BUT BLOOD AND OTHER KINDS OF, UM, UH, ISSUES.
UH, UH, BUT, UM, IMPORTANT, IMPORTANT IN THEIR, THEIR, THEIR, UH, INVESTIGATIVE WORK AND, AND OF COURSE, TO THE CRIME SCENE, UH, UM, WORK THAT THEY DO THERE.
UH, THE THERMAL DRONE IS AN ADDITIONAL DRONE THAT'LL BE ADDED TO THEIR FLEET.
THIS'LL GIVE THEM THE ABILITY, UM, TO, UH, AS WE'VE ALL SEEN ON SO MANY OF THEIR SOCIAL MEDIA POSTS, SO MANY APPREHENSIONS TAKING PLACE NOW BECAUSE OF THE, OF THE DRONES.
THIS WILL GIVE THEM THE ABILITY TO GO EVEN DEEPER INTO PLACES LIKE THE SPRING CREEK NATURE AREA, FOR INSTANCE, AND BE ABLE TO OBSERVE, UM, FOLKS THAT THEY MAY BE WANTING TO VISIT WITH FOR ONE REASON OR ANOTHER, AND HELP THEM KIND OF TAKE THEM IN SAFELY INTO CUSTODY.
THE CRIME PREVENTION BAIT VEHICLE, UH, THIS WOULD BE THE USE OF SEIZED VEHICLES, UH, MUCH LIKE YOU HAVE A, A BAIT BIKE AT THE, AT A DART STATION, FOR INSTANCE.
UM, BUT, UH, THIS EQUIPMENT WILL ALLOW THE BAIT VEHICLE TO BE SAFELY, UM, UH, SHUT DOWN, UM, AFTER IT'S, UM, UM, ILLEGALLY TAKEN, UM, AND ALLOW, UH, THE OFFICERS TO, TO, TO BE ABLE TO KIND OF TAKE THAT PERSON, UH, SAFELY INTO CUSTODY.
UH, THE, UH, RAPID DEPLOYMENT SMART CAMERA.
UM, THESE ARE CAMERAS, UM, THINK OF THESE AS SURVEILLANCE CAM, PORTABLE SURVEILLANCE CAMERAS.
SO LET'S SAY WE'RE HAVING A REALLY BAD PROBLEM WITH GRAFFITI, UM, AND MAYBE ON A KCS LINE UNDER AN OVERPASS, FOR INSTANCE.
THESE ARE CAMERAS THAT WE COULD DEPLOY IN A SITUATION LIKE THAT TO HELP WITH THE INVESTIGATIVE WORK.
UM, THEY'RE PORTABLE, THEY'RE VERY FLEXIBLE, AND THEY CAN BE USED IN A VARIETY OF SITUATIONS.
AND THEN, UH, IMPORTANTLY, UM, AN ADDITIONAL $10,000 BUILDING ON THE INCREASE IN FUNDING WE HAD LAST YEAR, UH, FOR THE COMMUNITY RELATIONS DIVISION TO ENHANCE PROGRAMMING, UM, UM, AND REALLY TO, UH, FOCUS ON TAKING PROGRAMING MORE OUT INTO THE COMMUNITY.
AND SO, PROGRAMS LIKE UNIDOS PROGRAMS, LIKE NATIONAL NIGHT I PROGRAMS, UH, ALL, ALL, ALL THE DIFFERENT COMMUNITY PROGRAM, COMMUNITY RELATIONS PROGRAMS, UH, THAT WILL BE ABLE TO KIND OF BE ENHANCED WITH, UH, WITH THIS ADDITIONAL FUNDING.
AND THEN FINALLY, UH, SOME SECURITY CAM, ADDITIONAL SECURITY CAMERAS, UH, AT THE EOC FOR THE EMERGENCY MANAGEMENT.
THIS IS A, A VERY IMPORTANT, UH, CHART THAT I, I HOPE YOU'LL APPRECIATE, UH, 'CAUSE IT'S YOUR WORK HERE.
UM, IF YOU LOOK AT, UM, UM, BACKDATE USING FY 21, 22 AS BASE YEAR, EACH OF THE LAST THREE BUDGETS, UM, WITH THE EXPENDITURES THAT WE'RE PROPOSING TODAY, YOUR INVESTMENT IN PUBLIC SAFETY, UH, OVER THE LAST THREE YEARS HAS INCREASED OVER 27%.
AND SO, A, A REAL COMMITMENT TO, WHEN WE'RE SAYING IT'S A FOCUSED AREA, UH, WE'RE DEMONSTRATING THAT THE INVESTMENT THAT WE'RE MAKING, UH, VIA THE BUDGET, REFLECTS THAT ONTO INFRASTRUCTURE.
UM, UH, REAL, AGAIN, REAL PROUD OF THE INFRASTRUCTURE INVESTMENT AND HOW THAT'S WORKED THIS PAST YEARS.
I'LL COME BACK TO THE CHANGE AND WHY IT SHOWS A A 0.3% DECLINE.
UH, BUT AGAIN, THE SCREENING, WALL MAINTENANCE, THE BRIDGE RAIL MAINTENANCE, UH, THESE ARE OUR, UH, AND, AND ENTRY FEATURES AND THINGS, UH, THINGS OF THAT NATURE.
[01:10:01]
THE INVESTMENT THAT WAS MADE AND VIA THE NEIGHBORHOOD VITALITY PROGRAM OVER THE YEARS.AND SO THEY'RE THINGS LIKE MASONRY SCREENING WALLS, UH, ENTRY FEATURES, UH, BRIDGE RAIL ENHANCEMENTS.
AND SO THIS IS FOR NOT ONLY THE MAINTENANCE OF THOSE, BUT THE, UH, CLEANING AS WELL AS MANY OF THOSE NOW OVER A DECADE OLD, UM, INCLUDED IN THIS BUDGET IS THE INFLATIONARY INCREASES THAT TRANSPORTATION, MOBILITY, RELAPSE, REAL, UH, HAS, UH, ENCOUNTERED.
UH, AND THIS WILL ALLOW US TO KEEP AT SOME OF THOSE RHYTHMS AND ROTATIONS THAT WE DESCRIBED TO YOU, UH, THAT WE WERE SO PROUD TO GET INTO LAST YEAR.
NO, WILL ALLOW US TO MAINTAIN THOSE.
AND THEN UNDER SPECIAL PROJECT FUNDS, I'LL COME BACK TO THIS IN A SECOND HERE, YOU'LL SEE A NEW SCHOOL ZONE FLASHER ON RENTER THERE.
UH, THE KEY INITIATIVES, OBVIOUSLY CONTINUATION OF THE 21 AND 23 BOND PROGRAMS AT THE AMOUNT YOU SEE THERE, ALMOST $19 MILLION.
UH, AND A COMBINATION OF, UH, BOTH CASH AND DEBT INTO WATER AND WASTEWATER MAINTENANCE AND CAPITAL PROJECTS.
UM, UH, ALMOST $2.8 MILLION, UH, FROM, UM, BOTH, UH, PROGRAMS AND SERVICES AS WELL AS CAPITAL PROJECTS, UH, BEING FUNDED BY THE DRAINAGE FEE.
AND THEN IMPORTANTLY, UM, THIS YEAR, UM, ALL OF THE, UH, PROPERTY TAX, UH, DEDICATIONS, THE TRANSFER OUTS, IF YOU WILL, THAT YOU SEE AT THE BOTTOM OF, UM, OF THAT FUND SUMMARY EVERY YEAR FOR STREETS, FOR ALLEYS, FOR PARK MAINTENANCE, FOR FACILITY MAINTENANCE, ALL BE INDEXED THIS YEAR, ALMOST 4%.
UM, AND SO YOU SEE A LARGE INCREASE.
NOW, I DO WANNA DRAW YOUR ATTENTION, UM, TO THE STREETS LINE ITEM.
REMEMBER, LAST YEAR, WE MADE A ONE TIME, UM, UM, DEDICATION TO THAT LINE ITEM OF $700,000 TO COMPLETE AN ADDITIONAL, UM, NEIGHBORHOOD ZONE, IF I BELIEVE WAS THE PLAN.
AND SO WHAT WE'RE DOING FOR HERE, IF YOU CONTROL FOR THAT $700,000, WHICH AGAIN, UH, WAS ALWAYS INTENDED TO BE A ONE-TIME, UH, KIND OF INJECTION INTO THAT PROGRAM, IF YOU CAN KIND OF CONTROL FOR THAT, IT IS GOING UP 4%.
BUT THAT ACCOUNTS FOR WHY THAT 0.3 NUMBER, THAT DECREASES 0.3% THAT YOU SEE ON THE FRONT THERE.
AND THEN IN THE CAPITAL REPLACEMENT FUND, YOU SEE, UH, A, UH, A DUMP TRUCK AND, UM, A, UH, SIGN ROLLER TABLE THAT'S BEING, UH, REPLACED VIA A CAPITAL FUND.
AGAIN, MUCH LIKE THE, UH, PRIOR SLIDE ON INFRAS ON, UH, PUBLIC SAFETY HERE, UM, AGAIN, USING 21, 22 AS THE BASE YEAR, UM, YOUR STRATEGIES EACH OF THE LAST TWO YEARS.
AND IF YOU, UM, UH, UH, PROCEED AS, AS OUTLINED HERE, ARE GOING TO INCREASE OUR INFRASTRUCTURE SPENDING 27% IN THREE YEARS.
AND SO, REALLY, UH, TAKING STRIDES TO, UH, COMBAT, UH, THE INFLATIONARY PRESSURES THAT WE SEE AND ALLOW US TO CONTINUE, UM, UH, TO, TO, UM, MAKE GREAT STRIDES ON THE INFRASTRUCTURE.
UH, THE LAST, UH, FOCUS AREA HERE IS ECONOMIC DEVELOPMENT.
I'LL TELL YOU, WITHOUT THE PUBLIC SAFETY AND WITHOUT THE INFRASTRUCTURE, I WOULDN'T EVEN HAVE ECONOMIC DEVELOPMENT ON HERE.
THAT'S HOW IMPORTANT BOTH OF THOSE ARE TO ECONOMIC DEVELOPMENT.
I DO WANNA JUST, UH, PAUSE HERE JUST FOR A SECOND BEFORE I GO THROUGH THIS SLIDE.
AND I DO WANNA ACKNOWLEDGE, UM, YOU KNOW, THIS IS, UH, THE TWO YEAR ANNIVERSARY, UH, OF THE ECONOMIC DEVELOPMENT DEPARTMENT MOVING IN-HOUSE.
AND I, I WILL LET YOU KNOW HERE, UM, UH, THAT WE ARE, UM, EVALUATING A NUMBER OF, UH, STRATEGIES ASSOCIATED WITH OUR ECONOMIC DEVELOPMENT PLAN.
NOTWITHSTANDING WHAT I THINK HAS BEEN AN AMAZING FIRST HALF OF 20, UH, 24, UM, AFTER LAUNCHING ON THESE KEY STRATEGIES, UM, THERE ARE THINGS THAT, UM, I, I, I THINK THAT WE CAN IMPROVE ON.
AND WE'RE TAKING THOSE INTERNAL STEPS TO DO THAT.
AND PART OF THE REASON WHY YOU SEE THIS DECLINE, UH, IN THE LINE ITEM FOR ECONOMIC DEVELOPMENT IS ASSOCIATED WITH THAT.
SO LEMME TELL YOU THE FIRST THING THAT, THAT WILL ACCOUNT FOR THAT DECLINE THAT YOU'LL SEE, UM, IS THAT I'M MOVING A MARKETING AND PLACEMAKING POSITION OUT OF ECONOMIC DEVELOPMENT, AND I'M PUTTING THAT MARKETING RESPONSIBILITY IN COMMUNICATIONS.
UM, GREG, UM, IS AN AMAZING, UH, LEADER OF OUR COMMUNICATION TEAM.
UM, THIS COMMUNICATION PERSON, UM, WILL APPROACH ECONOMIC DEVELOPMENT LIKE OUR OTHER COMMER COMMUNICATION, UM, UH, PROFESSIONALS APPROACH THINGS LIKE THE ANIMAL SHELTER OR LIKE, UM, THE CHERYL PARK OR ANY OF OUR OTHER DEPARTMENTS.
ECONOMIC DEVELOPMENT WILL BE AN INTERNAL CUSTOMER OF THAT PERSON.
BUT UNDER THE LEADERSHIP OF GREG, WE'LL BE ABLE TO LEVERAGE HIS EXPERTISE, WE'LL BE ABLE TO LEVERAGE THE EXPERTISE OF HIS TEAM AND THE COLLABORATION THAT'LL COME OUT OF THAT, THAT.
AND SO, UM, I WANT TO JUST REASSURE YOU THAT THERE'S NO, UM, REDUCTION IN THE DEDICATION TO ECONOMIC DEVELOPMENT.
IT'S JUST SIMPLY BEING, UM, REALLOCATED.
I'LL ALSO MENTION THAT AS I MAKE THAT MOVE, UM, AND CREATE AN ECONOMIC, I'M SORRY, CREATE A, UH, A, UM, A, UM, MARKETING, UM, SPECIALIST POSITION, UH, IN COMMUNICATION TO FOCUS ON ECONOMIC DEVELOPMENT, I'LL ALSO BE CREATING A PLACEMAKING POSITION.
UM, ONE OF THE LESSONS LEARNED WAS THAT BOTH OF THOSE, UM, BOTH OF THOSE FUNCTIONS UNDER ONE PERSON, UH, WAS A, UH, WAS TOO, UH, BIG OF A WORKLOAD, PARTICULARLY AROUND, UM, TIMES OF, UM, UM, UM, UH, THE, THE LUNAR NEW YEAR, LIGHT UP BLACKWOOD CULTURE IN THE CORE.
UM, AS WELL AS THAT, YOU WANNA CONTINUE TO SEE PLACEMAKING AND EVENTS GROW.
[01:15:01]
AND SO WE WILL, UH, BE CREATING A POSITION THAT'LL BE PARTIALLY FUNDED, UM, FROM THE GENERAL FUND AND PARTIALLY FUNDED FROM THE TIFF, UH, LIKE THE, UH, OTHER, UH, ENTREPRENEURSHIP, UH, POSITION IS, AND, AND, UH, AND, UH, THE IN ECONOMIC DEVELOPMENT THE SAME WAY.UM, AND, AND WE'LL BE CREATING THAT POSITION EFFECTIVE, UM, OCTOBER ONE.
AND THAT PERSON WILL NOT ONLY BE TASKED WITH, UM, THE EVENTS OF THE CORE DISTRICT, BUT, UH, LAUNCHING ON IMPORTANT INITIATIVES THAT WE'VE TALKED ABOUT FOR SOME TIME, AND THAT WE'RE IN THE CORE DISTRICT STRATEGIC PLAN, THINGS LIKE, UH, NEW, UH, UH, POLE BANNERS, THINGS LIKE SIGN TOPPERS, UM, THINGS LIKE, UM, UH, FURTHERING AND, AND, AND PROBABLY, UH, CEMENTING A, A BUSINESS ASSOCIATION, A VOLUNTARY BUSINESS ASSOCIATION FOR THE AREA, UM, AND HAVING THEM BE A BIG, BIGGER PARTNER IN THAT.
AND, AND SO, UM, JUST WANTED TO MAKE MENTION THOSE COUPLE OF CHANGES THERE.
UH, YOU SEE OUR, OUR OVERALL DEDICATION TO ECONOMIC DEVELOPMENT STRONGER THAN THE YEAR BEFORE, AGAIN, WITH OVER $2 MILLION BEING TRANSFERRED TO THE ECONOMIC DEVELOPMENT FUND, AND AT $90,000 IN INTERNATIONAL BUSINESS DEVELOPMENT, UH, BEING PAID FOR OUT OF THAT FUND THIS YEAR.
UM, SO THAT WAS, UM, UM, A NEW, A NEW INITIATIVE, UH, THAT, UH, WE'LL BE, UH, DISCUSSING IN MUCH MORE DETAIL, UH, COMING OUT OF THE, UH, TRIP THAT OUR ECONOMIC DEVELOPMENT TEAM AND COMMUNICATIONS TEAM RECENTLY TOOK, UH, TO, UH, TO INDIA, UH, UNDER ADDITIONAL FUNDING AS WELL.
UNDER, UH, FROM TIF NUMBER ONE, OF COURSE, WE'VE GOT THREE TESTS, BUT TIF NUMBER ONE, UM, UH, AS I MENTIONED, UH, FUNDING, UM, ABOUT $90,000 IMPROVEMENTS IN THE IQ HQ, UH, ONE TIME, UH, IMPROVEMENTS THAT WILL, UH, ALLOW US TO, TO LEVERAGE AND FURTHER THAT INTERNATIONAL BUSINESS DEVELOPMENT PROGRAM.
UM, I MENTIONED THE ED PERSONNEL COST, SO THAT'S HALF OF TWO POSITIONS, UM, THAT ARE BEING FUNDED.
UH, THE CORE DISTRICT PROGRAMMING, AND THEN THE PLACEMAKING INITIATIVES ALL, UH, BEING FUNDED, UM, CONTINUING TO BE FUNDED OUT OF, UH, OUT OF THE TIFF, UM, FOR A FULL AND COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGY.
SO THIS SLIDE IS ONE THAT WE, UH, UH, TYPICALLY END ON, UH, BEFORE I HAND IT, UH, OVER, UH, TO BOB.
AND, UH, GENERALLY IT LOOKS A LITTLE DIFFERENT BECAUSE THE NUMBER AT THE TOP IS USUALLY A LOT BIGGER.
AND THEN WE USUALLY EXPLAIN, UH, BY LINE ITEM HOW WE ARE GOING TO, UH, UTILIZE AND DEPLOY THOSE, UH, RESOURCES.
AND, AND THEN IT ENDS UP TOTALING, UM, UH, AND TYING OFF, UH, THIS YEAR, YOU CAN SEE WITH, UH, GOING BACK TO THE, ONE OF THE FIRST SLIDES, I STARTED WITH 1.1 MILLION NEW DOLLARS OF REVENUE IN THE GENERAL FUND.
YOU CAN SEE THERE WITH THE, THE, UH, PUBLIC SAFETY, UM, UH, 3% IN STEPS, COSTS, THE NON-PUBLIC SAFETY, UH, AND THEN THE INFLATIONARY INCREASES THAT WE FOUND THROUGHOUT THE ORGANIZATION THAT WERE JUST UNAVOIDABLE.
I KNEW YOU WOULD WANT TO CONTINUE WITH THE PROGRAM OF THE SERVICE, AND SO WE HAD TO FIGURE OUT A WAY TO TAKE ON THAT INFLATIONARY, UM, UH, COST.
AND SO THAT'S BUILT IN AS WELL.
WE'VE BEEN ABLE TO BALANCE THAT, UH, WITH A COUPLE OF NEW STRATEGIES.
UM, PREVIOUSLY, UM, OUR BUDGETING STRATEGY WAS TO FUND EVERY POSITION IN THIS CITY FOR A FULL 12 MONTHS, AND WE WOULD BURDEN, SO EVERY SINGLE FULL-TIME POSITION WOULD BE BUDGETED FOR A FULL 12 MONTHS OF SALARY.
UM, THAT'S A VERY CONSERVATIVE APPROACH.
UM, BUT, UM, I JUST SHOWED YOU, EVEN IN OUR BEST YEARS, EVEN IN OUR BEST YEARS, WE HAD A 5% ATTRITION.
SO WE WERE ESSENTIALLY, UH, UH, UH, OVERFUNDING 5% OF THE, OF THE POSITIONS FOR A WHOLE YEAR.
AND SO WHAT WE DID THIS YEAR WAS WE KIND OF TOOK A NEW APPROACH AND WE USED A 3% ATTRITION RATE.
UM, NOW, CURRENTLY AS A, AS WE JUST SHOWED YOU, WE WERE UP AROUND A 7% ATTRITION RATE RIGHT NOW.
SO WE'RE NOT EVEN USING ABOUT HALF OF THAT IF, AND, AND AGAIN, PUBLIC SAFETY IS A LITTLE DIFFERENT IF YOU CONTROL FOR PUBLIC SAFETY.
AND SO I FEEL IT'S A, IT'S A, IT'S A PRUDENT MOVE.
UM, I TALK TO A LOT OF MY CITY MANAGER PEERS, AND IT'S SOMETHING THAT THEY DO.
UM, WHEN YOU FUND EVERY POSITION FULLY FOR 12 MONTHS, YOU ARE TYING UP DOLLARS THAT CAN BE UTILIZED FOR IMPORTANT OTHER, UH, PURPOSES UNNECESSARILY.
AND, AND, AND SO I BELIEVE THIS IS A BEST PRACTICE IN BUDGETING MOVING FORWARD.
WE ALSO ASK THE DEPARTMENTS, UM, NOT TO CUT ANY OUTWARD FACING PROGRAMS, BUT REALLY CHALLENGE THE DEPARTMENTS.
CAN YOU BE MORE EFFICIENT? ARE THERE THINGS THAT WE COULD DO DIFFERENTLY MOVING FORWARD THAT WOULD END UP IN COST SAVINGS? UM, AND I'M PROUD OF THE DEPARTMENTS.
YOU KNOW, IT'S A BIG BUDGET AND $800,000 MIGHT NOT SEEM, OR $880,000 MAY NOT SEEM LIKE A LOT OF SAVINGS, BUT IT'S A, IT'S A GOOD STEP FORWARD.
AND IT'S, IT'S, AND PARTICULARLY THIS YEAR, IT'S A MEANINGFUL PART OF THE, THE SOLUTION.
UM, THE INFORMATION TECHNOLOGY AND TRAFFICKING INITIATIVES.
YOU MAY RECALL THIS WAS A SEVEN YEAR PLAN THAT WE ROLLED OUT TO YOU, UH, WHERE WE WOULD MAKE THIS TRANSFER FOR THOSE SEVEN YEARS, AND THEN THAT MONEY WOULD RETURN TO THE GENERAL FUND, UM, FOR A VARIETY OF REASONS.
UH, THAT SEVEN YEAR PLAN NOW IS PROBABLY MORE LIKE A NINE OR A 10 YEAR PLAN AS WE ROLL OUT AND TRANSITION OUR LEGACY SYSTEMS. BUT WHAT WE FOUND IS WE DON'T NEED AS MUCH MONEY EVERY YEAR.
I MEAN, THERE, YOU, YOU'VE, YOU'VE BEEN BRIEFED, UM, YEAR
[01:20:01]
AFTER YEAR ON SOME OF THE CHALLENGES THAT WE'VE HAD WITH SOME OF THE EARLIER DEPLOYMENT AND TRANSITIONS TO THOSE, THOSE NEW, UH, UH, SOFTWARE SYSTEMS. AND SO WHAT WE'RE DOING HERE IS, AGAIN, WE'RE RIGHT SIZING THE TRANSFER OUT ON AN ANNUAL BASIS, AND IT'S LESS NOW EACH YEAR BECAUSE WE'RE GOING TO HAVE TO GO FURTHER, MORE, MORE YEARS OUT.UM, AND SO, UH, WE'RE ABLE TO REDUCE THAT TRANSFER, I THINK FROM ABOUT ONE POINT, UH, SEVEN OR SO, 1.8 TO, UM, BY $600,000.
AND THEN THE FINAL, UH, AGAIN, BUILDING OUT OF AN IMPORTANT, UM, AN IMPORTANT, UM, TACTIC, UM, THAT YOU'VE ASKED US TO DO TO REALLY BE MINDFUL OF COURT PLAN.
UH, COURT PLAN, UM, IS IN THE BEST FINANCIAL POSITION THAT IT'S BEEN IN IN MY 28 YEARS WITH THE CITY.
I MEAN, IT'S, IT'S GOT A FUN BALANCE THAT'S, UM, ALMOST 40% HIGHER THAN INDUSTRY BEST PRACTICES.
AND THAT'S LARGELY BECAUSE OF HOW RESPONSIBLE OUR ORGANIZATION HAS BEEN, UH, MANAGING OUR HEALTHCARE.
UH, WE HAVE GREAT PARTNERS LIKE METHODIST SEARCHERS AND MEDICAL CENTER THAT ARE, THAT ARE SAVING US DOLLARS EVERY YEAR, UH, BY PUTTING ON SPECIAL PROGRAMS. AND SO WHAT WE'RE PROPOSING HERE IS TO REDUCE THE TRANSFER OUT FROM THE GENERAL FUND, UH, TO CORE PLAN.
NOW, WE'VE HAD OUR CONSULTANTS MODEL THIS, THIS, UM, STILL GIVES US A, A, UM, UH, A SEVERAL YEARS BEFORE IT WOULD EVEN, UM, BE A CONCERN.
UM, AND THAT'S ASSUMING, UH, THINGS, UH, DON'T IMPROVE.
AND WE DON'T START A RESTORATION OF THIS $580,000, SAY NEXT YEAR, FOR INSTANCE, OR EVEN MID-YEAR.
THERE WOULD BE NOTHING THAT IF THINGS WERE TRENDING POSITIVELY THIS YEAR THAT WE COULDN'T MID-YEAR MAKE THIS CONTRIBUTION AND COURT PLAN WOULD BE WHOLE.
AND SO THAT'S, UH, JUST AN EXAMPLE OF THE KINDS OF STEPS THAT WE'VE TAKEN TO TIE OFF THIS, UH, $1,132,000, UH, OF NEW REVENUE AND PUT IT TO GOOD USE.
UM, THE FINAL SECTION I DO WANNA, UH, COVER HERE, AND THIS IS SOMETHING, UH, NEW, UM, TO, TO THIS YEAR, IS, UM, UM, A PROPOSAL THAT I HAVE FOR YOU.
UM, YOU MAY RECALL BACK IN BOTH 1920 AND 2021, UH, MIDYEAR 1920, AND THEN IN 2021, BECAUSE OF COVID, WE HAD NO IDEA WHAT TO EXPECT.
I MEAN, WE DRAMATICALLY, UH, REDUCED OUR EXPENDITURES.
WE DRAMATICALLY, UH, UPDATED AND CHANGED OUR REVENUE PROJECTIONS.
AND WE WERE, UH, IN PARTICULAR VERY, UM, CONCERNED AND UNCERTAIN ABOUT WHAT WOULD HAPPEN TO, UM, THE HOTEL MOTEL TAX AND HOW THAT WOULD IMPACT THE HOTEL MOTEL FUND.
AND EACH OF THOSE YEARS, WE TRANSFERRED A MILLION DOLLARS FROM THE GENERAL FUND TO THE HOTEL MOTEL FUND IN AN ATTEMPT TO STABILIZE THE FUND, OR WHAT WE THOUGHT WOULD BE TO STABILIZE THE FUND.
WELL, IT TURNS OUT IT NEVER REALLY HAD AN IMPACT, AND IT ACTUALLY BEGAN TO PERFORM, UM, VERY, UH, STRONGLY.
AND SO WHAT WE FIND OURSELF WITH NOW IS A FUND BALANCE IN THE HOTEL MOTEL FUND OF SOMEBODY REMIND ME OF IT WAS A, WE, IF THE EQUIVALENT DAYS WAS OVER 200 DAY, 200 DAY FUND BALANCE IN THE HOTEL MOTEL FUND.
AND SO WHAT I'M PROPOSING IS TO ESSENTIALLY KIND OF PAY BACK THE GENERAL FUND 1 MILLION OF THOSE $2 MILLION AND USE THAT FOR NON-REOCCURRING SPECIAL PROJECTS THAT WE REALLY WOULD LIKE TO GET DONE THIS YEAR AND NOT HAVE TO USE DEBT, NOT HAVE TO USE ANY ADDITIONAL KIND OF, UH, BURDEN OUR DEBT.
AND SO WHAT WE'D LIKE TO DO IS TRANSFER THAT MILLION DOLLARS, USE, UH, ABOUT $335,000 TO RESURFACE, UH, THE HEIGHTS POOLS, UH, AT THE REC CENTER THERE BEFORE NEXT, UH, SWIM SEASON.
UM, UH, LEVERAGE, HOPEFULLY LEVERAGE A LOT OF OTHER, UH, GRANT DOLLARS.
UH, AND THE $150,000 HERE, I BELIEVE IS, IS OUR MATCH, UM, UM, FOR A FULL CITYWIDE A DA TRANSITION PLAN.
WE'VE NEVER HAD A A DA TRANSITION PLAN.
UM, AND I'LL TELL YOU, UM, I BELIEVE IT'S GOING TO START HAMPERING OUR ABILITY TO GET CERTAIN FEDERAL, UH, FUNDING OR EVEN STATE FUNDING, UM, IF WE DON'T HAVE ONE.
JUST RECENTLY TXDOT REACHED OUT AND DID A SURVEY, UM, AND WANTED TO SEE OUR TRANSITION PLAN, UM, AND HOW WE, WE, HOW WE WERE USING THAT, UH, AS WE WENT ABOUT APPLYING FOR, UH, CERTAIN, UH, GRANT OPPORTUNITIES WITH THEM.
AND SO I BELIEVE IT'S ESSENTIAL TO LEVERAGE THESE OTHER GRANT DOLLARS THAT WE MIGHT HAVE TO CONDUCT AND TO CREATE AN A DA TRANSITION PLAN TO CONTINUE TO BE ABLE TO LEVERAGE GRANT DOLLARS MOVING FORWARD.
AND THAT'S WHY IT'S A PRIORITY.
THE HOUSING NEEDS ASSESSMENT THAT WE BRIEFED YOU ABOUT BACK, UH, IN APRIL IS INCLUDED IN THIS ONE TIME NON-REOCCURRING.
UM, THE FIRE STATION BAY IMPROVEMENTS THAT I MENTIONED PREVIOUSLY WOULD BE PAID FOR OUT OF HERE.
UH, THE, AS WOULD BE THE NEW TECHNOLOGY FOR THE CRIME SCENE LAB, UH, THE SCHOOL, UH, THE RENTER ROAD, UH, NEW SCHOOL ZONE FLASHERS, A, UH, CITYWIDE CYBER SECURITY RISK ASSESSMENT.
AND THEN FINALLY, UM, UH, BUILDING ON THE CHALLENGE THAT, UH, UH, THAT, UH, MAYOR, YOU AND THE COUNCIL, UH, ISSUED TO US IN EARLY JULY, WE WANNA PROVIDE, WE WANNA RECOMMEND USING $200,000 OF THE MILLION DOLLARS FOR RICHARDSON REPLANTS INITIATIVE.
UH, OBVIOUSLY THE MAY 28TH STORM CREATED, UM, YOU KNOW, WHEN A, A, UH, A RECORD BREAKING, YOU KNOW, 260,000 CUBIC YARDS OF VEGETATION.
[01:25:01]
AS WE ALL DROVE THIS, THE CITY WE KNOW, UH, JUST A RECORD BREAKING KIND OF IMPACT ON THE CITY WHERE, UH, LITERALLY HUNDREDS OF TREES, UH, THROUGHOUT THE CITY, UM, IF NOT, YOU KNOW, POTENTIALLY THOUSANDS OF TREES THROUGHOUT THE CITY, UH, WERE DAMAGED.UM, AGAIN, YOU INSTRUCTED STAFF TO DEVELOP A PRO, A PROGRAM TO ASSIST WITH THE RESTORATION OF THESE TREES.
UM, AND SO WHAT WE'D LIKE TO DO IS, UH, USE OUR, UH, RICHARDSON PLANTS AND KIND OF REBRAND THAT TO RICHARDSON REPLANT TO ASSIST WITH WHAT I WOULD SAY WOULD BE A MULTI-YEAR EFFORT YEAR ONE.
UH, WHAT WE'D LIKE TO SUGGEST IS TO GIVE AWAY TO RICHARDSON RESIDENTS A THOUSAND TREES BEFORE THE FIRST ANNIVERSARY OF THE STORM, BEFORE MAY 28TH.
LIKEWISE, TO PLANT A HUNDRED TREES IN OUR PARKS BEFORE THE FIRST ANNIVERSARY OF THE STORM.
UM, THE WAY WE WOULD DO THIS WOULD BE TO USE OUR FALL AND SPRING EVENTS IN THE FALL, FOCUSING ON HUFFINES NATIONAL NIGHT OUT, UH, THE NEIGHBORHOOD LEADERSHIP WORKSHOP, PUBLIC SAFETY EXPO, AND THE TEXAS ARBOR DAY, ALL TO PROVIDE, UH, WHAT WOULD LIKELY BE FIVE GALLON TREES.
SO NOT THOSE OF YOU THAT, THAT HAVE HAD THAT EXPERIENCE, NOT WHAT WE WOULD GIVE AWAY
UH, BECAUSE OF THE SHORT TIME SPAN WE HAVE HERE FOR THE FALL, UM, OUR OPTIONS ARE A LITTLE BIT MORE LIMITED THAN THEY PROBABLY WILL BE IN THE SPRING, BECAUSE WE HAVE TO PROCURE THESE IN A SHORT TIME.
SO WE'RE FOCUSING ON WHAT WE THINK WOULD BE AVAILABLE, THE BUR BOROUGH OAK, AND THEN AN ORNAMENTAL TREE IF SOMEBODY WOULD PREFER THAT, WHICH WOULD BE A DESERT WILLOW.
UM, I'M, I'M SUGGESTING THE $200,000, EVEN THOUGH I DON'T THINK IN YEAR ONE WE WOULD FULLY UTILIZE THE $200,000, BUT THERE'S A LOT OF WORK TO BE DONE ON THE PROCUREMENT SIDE TO, UM, TO, TO FULLY RESOLVE THAT QUESTION.
THE IMPORTANT POINT AND WHY I WANNA SUGGEST THAT THIS IS A MULTI-YEAR, UM, UM, RESTORATION IS BECAUSE WE BELIEVE THERE ACTUALLY ARE GOOD GRANT DOLLARS OUT THERE THAT WE COULD LEVERAGE.
UH, THE PROBLEM IS THOSE GRANT DOLLARS AND THOSE CYCLES DON'T NECESSARILY LINE UP WHEN, WHEN THE STORM HAPPENED, AND WE'RE, WE'RE LAUNCHING.
SO WE NEED A YEAR OR SO TO GET IN TO, TO BETTER UNDERSTAND WHAT THOSE OPTIONS ARE AND TO, UH, GO THROUGH THAT APPLICATION PROCESS, HOPEFULLY BE AWARDED, AND THEN MAYBE IN THE SPRING OR EARLY SUMMER, UH, UH, NEXT YEAR AS WE'RE IN THE EARLY STAGES OF THE BUDGET DEVELOPMENT PROCESS, WE COULD COME BACK TO YOU AND PRESENT WHAT WE WOULD PROPOSE FOR YEAR TWO AND, UH, APPROACH IT THAT WAY.
AND SO THAT WOULD BE, UH, KIND OF THE, UH, UTILIZATION OF, OF THAT, UH, MILLION DOLLARS THERE.
UH, MAYOR, I, UM, THIS IS WHERE I'M GONNA TAKE A BREAK AND HAND IT OFF TO BOB.
UH, I'LL LEAVE IT UP TO YOU IF YOU WOULD WANT TO HAVE ANY DISCUSSION OR QUESTIONS ON WHAT'S BEEN PRESENTED SO FAR.
IF YOU WANT US TO CONTINUE TO PROGRESS THROUGH AND COME BACK, WHATEVER WAY YOU AND THE COUNCIL WANNA MANAGE IT, I THINK WE'RE GOOD COUNSEL.
UM, FOR THE RECORD, IT'S NOT THIS BOB WHO'S SPEAKING, IT WOULD BE THAT BOB.
YEAH, YOUR FAVORITE PART OF THE NIGHT.
NUMBERS, NUMBERS AND MORE NUMBERS.
UM, AS DON MENTIONED, UH, WE'VE PUT TOGETHER A, A PRETTY, UH, PRETTY TOUGH BUDGET THIS YEAR.
THE LAST COUPLE YEARS HAVE BEEN DRIVEN BY WHAT WE WOULD SAY WERE EXPENDITURE DRIVERS.
UH, THE COST THAT WE WERE SEEING THIS YEAR, IT WAS QUICKLY, UM, ACKNOWLEDGED THAT OUR, OUR REVENUES WERE GONNA DRIVE THIS BUDGET MORE THAN ANYTHING.
SO THE GENERAL FUND BUDGET OF 180.7 MILLION, WHICH IS ABOUT A SIX A POINT, 6% INCREASE IN REVENUE, TOTAL EXPENDITURES IS 180.3 MILLION, WHICH IS ABOUT 1.2%.
ALL WITH BALANCING ABOVE THE MINIMUM FUND BALANCE OF 90 DAYS.
AS DON MENTIONED, UM, 180.7 MILLION, 72.4% IS MADE UP OF, OF TWO REVENUE SOURCES.
BUT THERE ARE SEVEN OTHER CATEGORIES THAT PLAY A VITAL ROLE IN, UH, THE CITY'S OVERALL BUDGET.
UH, AND YOU'VE SEEN THIS EARLIER.
UM, WE SEE THE SALES TAX, UM, TREND WAS WHAT WAS REALLY DRIVING THIS YEAR.
UM, BUT WE DID SEE SOME FRANCHISE FEES, UM, INCREASE MAINLY AS A RESULT OF SOME, UH, ELECTRIC FRANCHISE, WHICH WE'LL TOUCH ON HERE IN A SECOND.
LICENSING PERMITS AND FINES AND FORFEITURES ARE DOWN, UH, INTEREST, EARNINGS, UH, AND RECREATION, OTHER AND, UH, G AND A ALL UP, UH, PROJECTED UP FOR NEXT YEAR.
AS DON MENTIONED, UH, HE TALKED ALREADY TALKED ABOUT TOTAL PROPERTY TAXES OR, OR, OR THE, THE CURRENT YEAR TAXES.
UH, TOTAL, UH, REVENUE OF 77.8 MILLION, WHICH IS AN INCREASE OF 2.6 MILLION, UH, THE CURRENT YEAR PROPERTY TAX DOES INCLUDE A PROPOSED, UH, RATE INCREASE OF A LITTLE OVER, UH, 1.80 CENTS, UH, AND DOES BRING IN AN INCREASED REVENUE OF ABOUT $3 MILLION.
SO WHERE IS THE REDUCTION COMING FROM? AND THAT IS IN THE PRIOR YEAR TAX CATEGORY.
UM, PRIOR TO COVID, WE SAW ABOUT $250,000 IN THIS SUBCATEGORY, UH, EVERY YEAR.
AND ONCE WE GOT INTO COVID, UH, THAT NUMBER TURNED NEGATIVE, UH, IN FY 23,
[01:30:01]
IT TURNED POSITIVE, WHICH GAVE US SOME INDICATION THAT WE THOUGHT WE'D BE MOVING IN THAT DIRECTION.WHAT WE FOUND OUT WAS, AS A RESULT OF THE CYBER ATTACK FOR DALLAS COUNTY, SOME OF THOSE, OR DALLAS APPRAISAL DISTRICT, UH, SOME OF THOSE, UM, I THINK IT'S ACTUALLY DALLAS COUNTY, UM, UH, BUT SOME OF THOSE LAWSUIT SETTLEMENTS DID NOT GET RECORDED IN 23.
THEY GOT RECORDED IN 24, AND AS WE SAW 24 PROGRESS, WE'RE ACTUALLY SEEING MORE UNFAVORABLE, UM, OUTCOMES OF THESE LAWSUITS.
SO WE ARE PROJECTING, BASED OFF THE CURRENT TREND AND BASED OFF OF HOW LARGE OF VALUES ARE STILL IN DISPUTE, UH, A NEGATIVE $350,000 IN THIS SUBCATEGORY.
UM, THE PENALTIES AND INTEREST IS BASED ON A FIVE YEAR AVERAGE, ABOUT $262,000.
UH, FRANCHISE FEES, THIS IS WHERE I SAID WE, WE HAD A, AN INCREASE ABOUT A HUNDRED OR 819,000.
THE LARGEST INCREASE IS THERE IN THE ELECTRIC FRANCHISE FEE CATEGORY.
UM, WE'RE LOOKING AT, UH, $9.5 MILLION IN THE ELECTRIC FRANCHISE CATEGORY.
UH, THAT IS AN INCREASE OF 875,000.
UH, WHAT WE'RE SEEING SO FAR THIS YEAR, UH, IN FY 23, WE HAD $8.7 MILLION IN TOTAL REVENUE, AND THAT FROM ELECTRIC FRANCHISE, WE ARE UP SO FAR, THIS, SO FAR, THROUGH THIS PART IN THE YEAR, WE'RE UP 9% FROM LAST YEAR AND BASED FROM LAST YEAR.
BUT WHAT WE'VE BEEN ABLE TO SEE SO FAR IS THAT THERE IS A LITTLE UPTICK IN THE RESIDENTIAL SIDE OF THINGS, MOST LIKELY BECAUSE OF WORK FROM HOME.
BUT WE'RE ALSO SEEING PROBABLY AN UPTICK IN THE MANUFACTURING, UH, AREA.
UM, FOR THE LAST COUPLE YEARS, WE SAW, UH, AN IMPACT OF SOME COOLER WEATHER THIS YEAR WE DID NOT SEE THAT, AND WE'RE GONNA CONTINUE THAT, UH, MORE NORMALIZED YEAR IN NEXT YEAR.
UH, $1.8 MILLION, WHICH IS A DECREASE ABOUT $300,000.
TELEPHONE FRANCHISE, AND CABLE FRANCHISE.
BOTH OF THESE CATEGORIES ARE, ARE SEEING A, A SLIGHT DECLINE AS PEOPLE DROP THEIR, THEIR LANDLINES AND THEN SWITCH FROM CABLE TO STREAMING SERVICES.
THAT DOES IMPACT BOTH OF THOSE CATEGORIES.
AND THEN FRANCHISE FEES FROM WATER AND SEWER, UM, AND AS WELL SAW WASTE FRANCHISE ARE BASED OFF OF THE 5% OF THE REVENUE IN THOSE CATEGORIES.
UH, AS, AS DON MENTIONED, SALES TAX WAS PROBABLY THE, THE BIGGEST CHALLENGE FOR US THIS YEAR.
NOW, THERE ARE TWO SMALLER CATEGORIES OR SUBCATEGORIES, THE MIXED BEVERAGE AND, AND, AND THE BINGO TAX.
WE BASICALLY TREND THOSE OUT AND, AND WE'RE LOOKING AT 755,000 FOR THE MIXED BEVERAGE TAX, AND THEN THE BINGO TAX OF ABOUT ROUGHLY 49,000.
UM, WHAT WE SAW THROUGH THIS YEAR, AS DON MENTIONED, WAS SOME, SOME CHALLENGES IN THE BUSINESS TO BUSINESS REALM.
UM, WE ARE PROJECTING, UM, A 2% REDUCTION NEXT YEAR AFTER REMOVAL OF THE ROUGHLY $800,000 IN AUDIT ADJUSTMENTS THAT THE STATE HAS RECORDED THIS YEAR.
THAT IS A 9.1% DECLINE FROM THE FY 24 BUDGET AND A 3.1% DECLINE FROM THE FY 24 ESTIMATE.
IT'S ALSO 11% DECLINE FROM THE FY 23 ACTUAL.
UM, WE THINK THIS IS A, A GOOD ESTIMATE.
WE'RE, WE'RE STARTING TO SEE SOME DECENT SIGNS, UH, THROUGH THE FIRST FOUR MONTHS OF THE YEAR.
THE STATE AS A WHOLE WAS DOWN 1.9% THROUGH THE LAST FIVE MONTHS.
THE STATE AS A WHOLE IS UP ONE, UP 1.9%.
UH, WE'RE ALSO STARTING TO SEE SOME AREA CITIES START TO GET INTO THAT POSITIVE AREA, WHICH GIVES US A LITTLE BIT OF, UH, HOPE THERE.
AND WE'RE ALSO SEEING THROUGH THAT THIRD PARTY, HE REALLY HELPED US, UH, ISOLATE SOME THINGS.
OF THE 134, UM, COMPANIES THAT MAKE UP THAT 60%, 72 AS OF JULY, 72 OF THOSE 134 ARE NOW POSITIVE FROM LAST YEAR.
UH, SO WE'RE SEEING SOME THINGS MOVE IN THE RIGHT DIRECTION.
SO WE DO THINK THAT THIS IS A, A VERY, UM, UH, REALISTIC ESTIMATE GOING FORWARD.
UH, AND AS YOU CAN SEE, AS DON POINTED OUT, THIS IS, UH, YOU CAN SEE THE ILLUSTRATION.
IT'S BEEN A COUPLE YEARS SINCE WE'VE BEEN THIS LOW OR WHAT WE'RE PROJECTING.
UM, AND WE'LL CONTINUE TO MONITOR THAT, UH, AS WE GO FORWARD.
AS, AS DON MENTIONED ON THE EXPENDITURE SIDE, WE HAVE SOME THINGS THAT WE'RE GOING TO KIND OF HOLD BACK AND, AND NOT NECESSARILY LAUNCH ON RIGHT AWAY, UH, TO ENSURE THAT, UM, REVENUES ARE BEHAVING.
THE OTHER REVENUES, UH, THE TOTAL COMBINED OF, UH, JUST UNDER $30 MILLION, IT'S AN INCREASE OF 2.9 MILLION.
UH, LICENSE LICENSING PERMIT OF 3.1 MILLION.
UH, IT DOES INCLUDE ABOUT 67 OR 66,000 IN, IN, IN FEE INCREASES.
IT IS A DECLINE OF $225,000 FROM THE FY 24 BUDGET.
MOST OF THIS IS RELATED TO WHAT WE'RE ANTICIPATING AS A SLOW DOWN IN THE CONSTRUCTION, UH, REALM, UH, INTEREST EARNINGS OF 2.4 MILLION.
IT'S DOWN FROM THE, UH, ESTIMATE OF 2.7 MILLION THIS YEAR, UH, AND UP SLIGHTLY FROM THE FY 23 BUDGET.
NOW, THE FY 23 BUDGET WAS BUILT ON SOME ASSUMPTIONS OF SOME RATE CUTS THAT DIDN'T HAPPEN.
[01:35:01]
SO THAT'S, UH, RESULTING IN HIGHER THAN ANTICIPATED REVENUE THIS YEAR.NOW WE'RE ANTICIPATING SOME RATE CUTS AND, AND THERE'S SOME OTHER FACTORS SUCH AS HIGHER, UH, FUND BALANCE, AS WELL AS WE DO HAVE SOME, UH, WHEN, WHEN INTEREST RATES DO START TO COME DOWN, WE WON'T NECESSARILY SEE SOME OF THE IMPACT RIGHT AWAY.
WE HAVE SOME OF OUR INVESTMENTS THAT GO ON BEYOND NEXT YEAR, WHICH WILL KIND OF, UH, SOFTEN THAT FOR US.
SO WE THINK, UH, AGAIN, $2.4 MILLION, UH, AS A ESTIMATE OR FORECAST FOR NEXT YEAR.
UH, FINES AND FORFEITURES, UH, ARE BASED OFF OF THE ACTIVITY AT THE COURT.
UH, AND THEN OUR RECREATION AND LEISURE, 4.3 MILLION, WHICH IS, UH, 345,000 ABOVE, UH, THE CURRENT YEAR BUDGET AS A RESULT OF SOME STRONGER ACTIVITY AT THE, AT THE REC CENTERS.
WE, WE'VE, UH, SEEN THAT RETURN TO ITS PRE COVID LEVELS.
IT ALSO DOES INCLUDE ABOUT 108,000 IN, IN, UH, INCREASED PARK FEES.
THE OTHER REVENUE CATEGORY, YOU'LL SEE IT HAS A, A SUBSTANTIAL INCREASE, UH, 5.8 MILLION.
IT'S AN INCREASE OF $1.2 MILLION.
UH, THE MAJORITY OF THAT, ALMOST ALL OF IT COMES FROM THE AMBULANCE, UM, AREA, WHICH DOES INCLUDE ABOUT 275,000 IN, UH, A FEE INCREASE, UM, BASED ON SOME, SOME GOOD, UH, EFFORTS OUT AT THE, UH, FIRE, UH, PART OF THEIR, THEIR FIRE TRAINING OFFICER PAY.
SOME OF THEIR, UM, RESPONSIBILITIES INCLUDES, UH, UH, REVIEWING BILLS THAT ARE BEING SUBMITTED TO INSURANCE COMPANIES.
AND WHAT WE FOUND IS THAT THEY WEREN'T BEING, UM, FILED WRONG, BUT MAYBE NOT AS DETAILED AS WHAT THE INSURANCE COMPANIES WERE, WERE, UM, WANTING.
SO THIS FIRE TRAINING, UH, OFFICER, UH, RESPONSIBILITY ALLOWED THEM TO GO BACK THROUGH, UH, MAKE SURE THAT WE'RE BILLING FOR ALL THE, UM, MEDICATIONS AND, AND SUPPLIES THAT WERE IN THE AMBULANCE AT THE TIME, AS WELL AS, UH, ALL OTHER BILLABLE, UM, ITEMS. THEY'RE ALSO EVALUATING WHAT WE'RE CHARGING FOR, UH, MEDICATIONS.
AS WE'RE GETTING INCREASES ON MEDICATIONS, WE'RE ALLOWED THROUGH REGULATIONS TO INCREASE THAT AS WELL.
AND WE'RE DOING THAT MORE OFTEN, WHICH IS RESULTING IN HIGHER REVENUE.
NOW, THIS BRINGS US TO THE FY 23 LEVEL.
WE DID GO A LITTLE BIT CONSERVATIVE ON THE FY 24 BUDGET.
WE WEREN'T SURE NECESSARILY IF THIS WAS A, A SUSTAINABLE PRACTICE.
AND IT TURNS OUT THAT, UH, WE'RE SEEING, UM, ADEQUATE RESULTS THIS YEAR AS WELL.
THE GNA OF 12.5 MILLION, THIS IS AN INCREASE OF 1.7 MILLION OVER THE BUDGET.
NOW, JUST AS, UH, COVID STARTED, UH, WE, THIS IS WHEN WE, UM, UNDERTOOK UPDATING OF OUR COST ALLOCATION PLAN.
AND THE RESULT OF THAT WAS THERE WAS A COUPLE FUNDS THAT WERE UNDERPAYING FOR THEIR GNA.
UM, BUT AT THE TIME, WE DIDN'T THINK THAT A COUPLE OF THE FUNDS COULD AFFORD THAT.
SO THIS IS YEAR THREE OF OUR MULTI-YEAR STEP TO GET MOST OF THOSE FUNDS UP TO A HUNDRED PERCENT, UH, GOLF.
AND, UH, THE TIFF ARE, ARE TWO THAT ARE GOING TO BE A LITTLE BIT UNDER, UH, BUT WE ARE, UH, TAKING, UH, UH, SOLID WASTE FROM 90% OF THEIR TARGET TO A HUNDRED.
HOTEL MOTEL WILL GET TO HIS A HUNDRED AS WELL.
AND THEN THE DRAINAGE FEE WILL INCREASE FROM 75% OF THEIR TARGET TO 87.5%.
SO ALL OF IT IS BASED OFF OF OUR COST ALLOCATION PLAN AND TRYING TO GET THEM TO THE, THE TARGET AS DE UH, AS, UH, DICTATED BY THAT COST ALLOCATION PLAN.
UH, THE FIRST ONE IS THE AMBULANCE TRANSPORT FEE.
UH, GOING INTO EVERY BUDGET SEASON, WE ASK OUR DEPARTMENTS TO REVIEW THEIR, THEIR FEES, UH, TO, UM, TO EVALUATE WHETHER OR NOT THEY'RE, YOU KNOW, MARKET BASED.
UH, YOU KNOW, WHERE ARE WE ON ON SOME OF THESE? DO THEY NEED TO BE INCREASED, DECREASED? UH, A COUPLE YEARS AGO, WE DECREASED OR ELIMINATED THE LATE FEE AT THE LIBRARY, AND THAT WAS ALL BASED OFF OF SOME MARKET RESEARCH.
WE'VE DONE, UH, THE AMBULANCE TRANSPORT FEE BASED OFF OF WHAT, UM, UH, FIRE WAS ABLE TO DO AS FAR AS A MARKET SURVEY, AS WELL AS, UM, UH, BRINGING IN OUR, OUR BILLING COMPANY TO DETERMINE WHAT DO INSURANCE COMPANIES CONSIDER A FAIR TRANSPORT COST, UH, THAT WE FELT WE CAN INCREASE THAT FROM $675 PER TRANSPORT TO 875, UH, DOLLARS PER TRANSPORT.
AGAIN, KEEPING US WITHIN MARKET AS WELL AS UNDER WHAT, UH, INSURANCE COMPANIES FEEL IS AN ACCEPTABLE REIMBURSEMENT.
THESE ARE ALL MAR UH, MARKET BASED.
UH, GOING THROUGH THEIR, UH, MARKET SURVEY, WE FOUND THAT THERE WAS A COUPLE AREAS, UH, WHERE WE WERE UNDERCHARGING OR, OR UNDER, UH, THE AVERAGE, UM, MARKET AVERAGE.
THE PLAN IN, IN THE PLANNING SE AREA, THAT'S THE TREE MITIGATION PROGRAM THAT YOU WERE BRIEFED ON AND PASSED EARLIER THIS YEAR.
UH, THIS WOULD BE PUTTING THOSE FEES IN PLACE OCTOBER ONE.
UM, AND IT'S KIND OF BEEN A GRACE PERIOD UP UNTIL THEN, AND THAT WOULD GENERATE ABOUT, UH, $20,000 IN ADDITIONAL REVENUE.
THE LARGEST AREA WE'VE SEEN, UH, WELL, THE, THE, THE AMBULANCE
[01:40:01]
ONE WAS A LITTLE BETTER, BUT WE SEE MORE FEES BEING INCREASED HERE IS IN, IN THE PARKS ROOM, THE SPECIAL PERMIT.THIS IS FOR, UH, UH, COST RECOVERY EFFORTS FOR THINGS LIKE BOUNCE HOUSES, TENTS, UH, CHAIRS, THOSE KIND OF THINGS.
THIS ALLOWS, UH, TO RE ALLOWS US TO RECOVER SOME OF THE, UH, COSTS THAT IS ASSOCIATED WITH OUR STAFF SPENDING SOME TIME ON THAT.
THE PAVILION RENTALS, THIS REALLY ISN'T A CHANGE TO THE FEED, BUT IT'S KIND OF A CHANGE IN, IN METHODOLOGY.
UH, WE ARE SETTING UP, UH, SCHEDULED BLOCKS INSTEAD OF THEM JUST CALLING AND SAYING, WE WANT THIS BLOCK, WHAT WE FOUND WAS THAT THERE WERE, THERE WAS, IT WAS LEAVING, UH, UNUSED TIME, YOU KNOW, IT, IT WOULD LEAVE AN HOUR HERE, BUT THAT THE NEXT GROUP THAT WANTED TO, TO RENT THAT ONE TO TWO HOURS.
SO WHAT WE'RE DOING IS WE'RE BLOCKING 'EM IN TWO HOUR INCREMENTS.
IT'S GOING TO ALLOW STAFF EFFICIENCIES ON WHEN THEY CAN SCHEDULE, UM, A, UH, UH, SETTING THOSE UP AND THOSE KIND OF THINGS, BUT ALSO WE FEEL WOULD OPEN UP AVAILABILITY TO OTHER, UH, GROUPS THAT MIGHT WANT TO RENT THOSE.
UH, THE PLAYGROUND, UH, KINDERGARTEN CAMP, UH, ELEMENTARY CAMP AND TEEN CAMP.
THESE ARE ALL RESPONSES TO INCREASED COSTS OF THOSE PROGRAMS ARE, ARE CAUSED, UH, ARE COSTING.
YOU'LL SEE THAT, UM, THE BUSES THAT WE'RE RENTING, UH, STAFF TIME AS WELL AS JUST THE COST OF THE FIELD TRIPS THEMSELF ARE JUST, UM, ARE, ARE COSTING MORE.
UH, THE REC CENTER MEMBERSHIPS, UH, THEY, THESE FEES HAVE NOT BEEN INCREASED SINCE 2013, UH, WITH THE EXCEPTION, I THINK, OF THE CORPORATE MEMBERSHIP, WHICH WAS ESTABLISHED IN 2017.
UM, BUT THESE FEES HAVE NOT BEEN ADJUSTED SINCE 2013.
AND BASED OFF OF, UH, MARKET AVERAGES, WE FELT THERE WAS SOME ROOM THERE AS WELL.
UH, THE TOURNAMENT GATE FEE, THIS IS A COST RECOVERY.
IT'S A, IT'S A PER TEAM, UH, UH, CHARGE AND ALLOWS US TO, TO BETTER STAFF SOME OF THESE TOURNAMENTS, UH, TENNIS COURT, UM, FEES ARE, ARE ALSO MARKET BASED.
AND THEN THE VAN, UH, RIDE, UM, I DON'T THINK IT'S BEEN ADJUSTED SINCE WE'VE, UH, STARTED THAT, AND I DON'T REMEMBER THE YEAR ON THAT, BUT IT'S, IT'S BEEN QUITE A WHILE SINCE WE'VE, UH, INCREASED THAT FEE.
TOTAL EXPENDITURES OF 180.3 67% OF THAT IS A RESULT, UH, OR IS THROUGH PERSONNEL.
AND YOU'LL SEE THAT, UH, IN THAT TOP GREEN BAR.
THAT'S THE RESULT OF THE COMPENSATION ADJUSTMENT, UH, THAT WE'RE PROPOSING WITH THIS BUDGET.
THE TRANSFERS OUT THAT NEGATIVE IS A RESULT OF THAT.
UM, IT AND TRAFFIC INITIATIVE REDUCTION, UM, BUT THE REST OF THEM ARE BEING INDEXED TO, UH, MATCH, UH, THE GROWTH IN PROPERTY TAXES.
SO WHERE DOES THE GENERAL FUND REVENUE GO? 75.3% OF THIS REVENUE GOES TO FOUR CATEGORIES.
PUBLIC SAFETY, UH, GENERAL GOVERNMENT, THAT'S YOUR CITY MANAGER'S OFFICE, CITY SECRETARY, FINANCE, ACCOUNTING, UH, COMMUNICATIONS, AND THEN NON-DEPARTMENTAL WHERE WE HAVE STUFF LIKE, UH, LIABILITY INSURANCE AND RADIO MAINTENANCE AND THAT KIND OF THINGS.
UH, INFRASTRUCTURE MOBILITY, UH, 11.7%.
AND THEN RECREATION LEISURE BANKS, THAT'S ABOUT 9%, BUT COMBINED, THAT'S ABOUT 75% OF THE TOTAL GENERAL FUND BUDGET.
UH, AGAIN, ON OUR, OUR TRANSFERS OUT, UH, 60, UH, $600,000 DECREASE AS THE, UM, AS THE, THAT FUNDING PLAN HAS BEEN RETHOUGHT, AS WELL AS SOME OF THE, UM, PROGRAM IS MOVING FROM, YOU KNOW, GENERAL GOVERNMENT RELATED TO UTILITY BILLING.
SO YOU'LL SEE IN THE, IN THE WATER FUND, THE WATER FUND WILL BE MAKING UP A LARGER PORTION OF, UH, THE FUNDING AS WE, UH, MOVE TO MORE UTILITY BILLING, UH, REPLACEMENTS.
AND THEN THE, UH, STREET ALLEY FACILITY MAINTENANCE PARKS, MAINTENANCE, ECONOMIC DEVELOPMENT EQUIPMENT REPLACEMENTS.
UH, AFTER THE REMOVAL OF THAT ONE TIME, UH, STREETS DEDICATION IN FY 24, WE'RE ALL GROWING AT THE SAME RATE AS PROPERTY TAXES.
AND AGAIN, THIS ALL BALANCES THE FUND TO 90.99 DAYS ABOVE OUR, OUR MINIMUM 90 DAY BALANCE.
UH, GENERAL GOVERNMENT, UH, 24.8 MILLION FOR NEXT YEAR.
THIS IS A, A REDUCTION OF 421,000.
UH, THE, THE LARGEST PART OF THAT REDUCTION ACTUALLY WAS, UH, DUE TO SOME GOOD WORK, KENT AND, AND, AND JOSE AND, AND THE HR TEAM DID AND REEVALUATING OUR, UH, INSURANCE LIABILITY INSURANCE NEEDS AND, AND GOING OUT AND SHOPPING THAT AROUND.
WHAT WE FOUND IS, UH, WE MOVED OUR MOST OF OUR INSURANCE TO TML, AND THAT IS SAVING THE CITY, UH, NEXT YEAR ABOUT A MILLION DOLLARS.
SO THAT WAS SOME, SOME GOOD WORK THAT THAT GROUP DID.
UH, THIS BUDGET FOR GENERAL GOVERNMENT INCLUDES SOME EXPANDED COMMUNITY ENGAGEMENT STRATEGIES, AS WELL AS, UH, BROADENING DIVERSITY ON OUR APPLICATIONS FOR BOARDS AND COMMISSIONS, UH, THE CARES PROGRAM AGAIN, AND CONTINUED FUNDING FOR THAT.
UH, IT DOES INCLUDE THE INSURANCE PREMIUMS AND STUFF LIKE RADIO MAINTENANCE AND PHONE FEES, UH, ONGOING SUPPORTIVE, THE NETWORK OF COMMUNITY MINISTRIES AND THE COUNSELING PLACE AT $500,000 EACH.
[01:45:01]
FUNDING FROM, UH, ENHANCED RECRUITMENT EFFORTS THROUGH HR.UM, WE ARE PUR, UH, PROPOSING, UH, PURCHASING A GRANT APPLICATION SOFTWARE THAT COULD BE USED IN, IN MULTIPLE AREAS FOR ABOUT $10,000.
AND THEN THROUGH THE JUDICIAL EFFICIENCY FUND, YOU'LL SEE, UM, PHASE TWO OF SOME MUNICIPAL CAR, MUNICIPAL COURT, UH, REFRESHMENT, UH, CARPET AND, AND, UM, CUBICLE UPDATES, UH, COMMUNITY AND NEIGHBORHOOD SERVICES.
IT'S AN INCREASE OF, UH, 571,000, UH, LARGEST PART OF THAT, OR ACTUALLY THE INCREASE IS ALL DUE TO THE HOME IMPROVEMENT INCENTIVE PROGRAM, WHICH WE'RE SEEING AT 1.9 MILLION FOR NEXT YEAR.
THAT'S AN INCREASE OF 675 OR 57,000.
IT ALSO PROVIDES FOR ONGOING HOMEOWNER AND NEIGHBORHOOD ASSOCIATION SUPPORT PROGRAMS, AS WELL AS, UH, SCREENING, WALL PAINT, UH, WASHING AND AND PAINTING PROGRAM.
AND A GR UH, GRAFFITI ABATEMENT THROUGH COMMUNITY SERVICES, UM, WHERE YOU DO SEE ONE AREA OF DECREASE.
AND THIS GOES WITH OUR, WHAT WE'RE EXPECTING ON THE REVENUE SIDE FOR BUILDING PERMITS.
UM, SOME OF BUILDING INSPECTIONS, UH, INSPECTIONS DONE BY BUILDING INSPECTION.
SOME OF THE BUILDING INSPECTIONS DONE BY BUILDING INSPECTION ARE DONE BY A CONTRACT.
UH, WE'RE SE GRANTED, WE'RE PROPOSING OR, OR PLANNING ON A REDUCTION OF ALMOST A A HUNDRED THOUSAND DOLLARS AS WE SEE LESS, UH, NEED FOR THOSE, UH, CONTRACT INSPECTIONS.
WE DO INCLUDE MONEY, UH, IN THE GENERAL FUND FOR A, UH, NEW CURB APPEAL CAMPAIGN, AS WELL AS NEW RESIDENT RESOURCES FOR ABOUT $5,000 EACH, UH, AS WELL AS, UM, THROUGH THE SPECIAL PROJECTS FUND THAT THAT DON DESCRIBED OF 150,000, UH, THE PLANNING AND DEVELOPMENT SERVICES BUDGET.
THIS, UH, PROVIDES FOR, UM, UH, FUNDING FOR ABOUT 12 POSITIONS AND PROVIDES ONGOING SUPPORT FOR THE CITY PLANNING, COMMISSIONING, AND THE ZONING BOARD OF ADJUSTMENT, AS WELL AS FOR THE COMPLETION OF THE, UH, COMPREHENSIVE PLAN, UH, FLEET AND FACILITIES.
THIS WAS A NEW DEPARTMENT IN FY 24 AND REALLY PROBABLY HOUSES THE UNSUNG HEROES OF THE CITY.
THEY'RE THE ONES THAT HELPED MAKE SURE THAT OUR BUILDINGS AND, AND EQUIPMENT ARE, UH, AVAILABLE FOR THE REST OF US TO DO OUR JOB.
UH, WE'RE SEEING ABOUT 750 OR $747,000 INCREASE, UH, IN THIS AREA.
A LOT OF THAT HAS TO DO WITH ELECTRICITY, WHICH IS GOING UP ABOUT A HUNDRED THOUSAND DOLLARS NEXT YEAR AND OUTSIDE REPAIR AND PARTS AT FLEET, ABOUT 310,000 NEXT YEAR.
UH, IN FACILITY MAINTENANCE, WE'RE SEEING, UH, $435,000 FOR CONTRACT INSPECTION AND MAINTENANCE SERVICES ON THINGS LIKE ELEVATORS AND GENERATORS AND, AND, UH, COOLING TOWER CLEANING.
IT'S, THAT'S A ROUGHLY $69,000 INCREASE.
UH, THERE'S 838,000 DEDICATED TO ROUTINE MAINTENANCE.
AND THEN THE PROPERTY TAX DEDICATION TO FACILITY MAINTENANCE IS INCREASING, UH, ABOUT 24,000 TO 623,000.
UH, CUSTODIAL SERVICES IS BUDGETED, 1.7 MILLION ISH, UH, FOR IN-HOUSE, CUSTODIAL AND, UH, SERVICES IN ABOUT 453,000 FOR CONTRACTUAL, UH, CUSTODIAL SERVICES.
UH, AND THEN OUR FLEET DEPARTMENT, OUR FLEET DIVISION IS BUDGETED AT ROUGHLY $7.1 MILLION LIBRARY, 300, 3.9 MILLION, ROUGHLY UNCHANGED, UH, BUT IT DOES, UH, PROVIDE FULL FUNDING FOR LIBRARY OPERATING AT THEIR MOD MODIFIED LOCATION DOWN THE HALL HERE.
UM, IT DOES INCLUDE FUNDING FOR CONTINUED CULTURAL DIVERSITY PROGRAMS AND EVENT OPPORTUNITIES, FUNDING FOR OPERATION OF THE LIBRARY, UH, COMMUNITY OUTREACH FAN, AS WELL AS SUBSCRIPTION SERVICES OF ABOUT $50,000 AND $30,000 TOWARDS THE CONTINUED SUPPORT OF THE RICHARDSON ADULT LITERACY CENTER.
UM, AS PART OF OUR CASH FUNDED CAPITAL REPLACEMENT FUND, WE HAVE ABOUT 375,000 FOR THE REPLACEMENT OF BOOKS.
PROPOSED BUDGET OF, UH, 9.9 MILLION.
UH, IT'S A DECREASE OF 235,000 OR 234,000.
AND THE MAJORITY OF THIS, WELL, THIS IS AS A RESULT OF THAT, UH, $600, $600,000 REDUCTION IN THAT, UH, OPERATING TRANSFER TO FOR IT AND TRAFFIC INITIATIVES.
UH, CLOUD-BASED SERVICES OF 1.4 MILLION.
THIS IS AN INCREASE OF 262,000 OR ROUGHLY 18%.
SOFTWARE LICENSE AGREEMENTS ARE PROPO, UM, RECOMMENDED AT 1.1 MILLION.
AND THIS IS ROUGHLY ONE, UH, ABOUT 10%.
UH, THESE ARE, ARE ITEMS THAT WE PRETTY MUCH HAD NO, UH, OPTION ON HARDWARE MAINTENANCE, $324,000, 325,000, UH, AS WELL AS, UH, THERE IS THE $600,000 REDUCTION IN THE TRANSFER, UH, TO THE IT AND TRAFFIC INITIATIVE.
THE PROPERTY TAX DEDICATION THAT'S, UM, DEDICATED TOWARDS IT.
REPLACEMENT IS GONNA BE IN AT $1.6 MILLION FOR
[01:50:01]
NEXT YEAR, AND DOES INCLUDE THE $25,000, UH, CYBERSECURITY ASSESSMENT THAT DON MENTIONED EARLIER.RECREATION LEISURE, UH, 17.3 MILLION, ROUGHLY UNCHANGED.
UM, IT DOES, UH, INCLUDE FUNDING FOR ALL OF THE TRADITIONAL COMMUNITY EVENTS, FULL OPERATIONS OF THE POOLS, UH, SUPPORT OF INCREASED ACTIVITY AT THE TENNIS CENTER.
UH, THE, AGAIN, THE PROPERTY TAX, UH, DEDICATION OF 623,000, AND THEN INCLUDES 25,000 FOR MATCHING FUND BEAUTIFICATION WITH SOME OF OUR AREA NEIGHBORHOODS.
UH, SOME OF THE EXPANDED INITIATIVES THAT ARE FUNDED IN THE GENERAL FUND, ADAPTIVE DATE, ADAPTIVE ADULT VENTURE DAYS OF, UH, OVER A LITTLE OVER $5,200.
THE ADAPTIVE, UH, PROGRAM CAMP, COURAGEOUS OF JUST UNDER 7,000.
UH, LIGHT CONVERSION AT MIN MUSCO, UH, PARK OR MI UH, MI OH MI MIMOSA PARK, THANK YOU.
AND THEN, UH, THE CITY OR FACILITY WIDE PUBLIC ADDRESS AND SOUND SYSTEM UPGRADES AT HUFF FINDS, UH, REC CENTER FOR ABOUT $4,500.
UH, THERE'S ALSO THE 335,000 SET ASIDE FOR POOL RESURFACING THROUGH THAT, UH, TRANSFER OUT FROM THE HOTEL FUND THROUGH THE, UH, CASH FUNDED CAPITAL REPLACEMENT FUND.
UH, ROUGHLY, UH, $549,000 IS GOING TO BE, UH, SET ASIDE FOR SOME PARK IMPROVEMENTS.
IT INCLUDES 300,000 FURTHER REPLACEMENT OF SOME PICKUP TRUCKS.
UH, THE, THE CREDIT CARD READERS, DUE TO SOME TECHNOLOGY UPGRADES NEEDED TO BE REPLACED AT $6,500.
UH, YOU SEE SOME GYMNASTICS FLOORS OF 14,000.
UH, AND THEN THERE'S SOME EQUIPMENT REPLACEMENTS, SOME, UM, STAIR STEPPERS AND TREADMILLS.
UH, WE SEE SOME, UH, AGAIN, FORWARD REPLACEMENTS AT, AT HEIGHTS AND, AND VARIOUS, UH, UPGRADES AT, AT OUR POOLS IN, IN OUR TENNIS, UH, FACILITY.
UM, I THINK THAT CONCLUDES THE GENERAL FUNDS, UH, PROGRAM.
THE SERVICE, UH, WE'LL AT THIS POINT TALK ABOUT OUR, UH, UH, TAX, TAX RATE, UM, CONSIDERATIONS, MAYOR, SINCE, SINCE WE'RE, UH, THIS FAR, UM, IF YOU DON'T MIND, I'LL GO AHEAD AND FINISH THE TAX RATE DISCUSSION, THEN WE CAN, UH, HAVE GOOD DIALOGUE.
UM, SO A LOT OF THESE SLIDES WILL LOOK FAMILIAR TO YOU FROM LAST YEAR.
SOME OF THE NUMBERS HAVE CHANGED.
UM, IF YOU LOOK AT THE, UH, FIRST CERTIFIED TAX ROLL, UM, IF YOU LOOK AT THE TOP THERE, THIS 26 POINT, UM, ONE, UH, BILLION DOLLARS WHEN YOU ADD IN, UH, VALUES AND DISPUTE AND THEN SUBTRACT OUT, UH, TIFF, UH, INCREMENT WE'RE LEFT WITH, UH, JUST OVER 24 BILLION AVAILABLE FOR, TO THE, UH, GENERAL FUND AND FOR DEBT SERVICE.
UM, THAT'S AN INCREASE OF, UH, 9.96% OVER LAST YEAR.
YOU'VE GOT, UH, ALMOST, UH, 51.75% OF RESIDENTIAL ACCOUNTS THAT SAW MARKET VALUE INCREASE OF 10% OR MORE, UH, 65.5% OF RESIDENTIAL ACCOUNTS QUALIFIED FOR THE HOMESTEAD CAP.
LIMITING THAT TAXABLE INCREASE TO 10%, UH, THE CURRENT SENIOR EXEMPTION OF 145 EQUATES TO A 30% PROTECTION MEETING YOUR FINANCIAL, UH, POLICY GOAL.
AND THEN, UH, INTERESTINGLY ENOUGH, UH, AGAIN, TOTAL SENIOR ACCOUNTS INCREASED BY ABOUT 2.27%.
UH, CURRENTLY, UH, ALMOST 32% OF, UH, THE TOTAL RESIDENTIAL ACCOUNTS.
IF YOU LOOK AT HOME, UH, AVERAGE HOME VALUES, YOU'VE GOT THE MARKET VALUE, UH, JUST OVER $475,000, UP 10%, 10.818%, AND THEN THE TAXABLE AVERAGE HOME VALUE AT $387,000, UH, UP 10.37%.
UM, IF YOU LOOK AT OUR RESIDENTIAL COMMERCIAL VALUES SPLIT, UH, WE'VE GOT, UH, 58.24% COMMERCIAL COMPARED TO 41.7, UH, 6 41 0.76% RESIDENTIAL, AND THE TAXABLE ROLE CHANGE, YOU SAW 10.38% IN THE RESIDENTIAL 3.95 IN COMMERCIAL, AND THEN 12.41 IN BPP.
I THOUGHT IT'D BE INTERESTING, UH, TO, TO LOOK AT THE, THE, THE, THAT THE, UH, HISTORY AND COMPARE THE RESIDENTIAL AND COMMERCIAL, UH, OVER, UH, SAY THE, UH, LAST 20 YEARS OR SO, UH, YOU KNOW, AS BACK AROUND OH FIVE OR SO WHEN, UH, RESIDENTIAL ACTUALLY, UH, OUTPACED THE COMMERCIAL BY 52 TO 48.
UM, AND THEN YOU REALLY START TO KIND OF SEE, UH, COMMERCIAL REALLY START TO TAKE OFF AND A DIFFERENCE TO BE, UH, HAD AROUND THAT 20 12, 20 13 TIMEFRAME.
AND REALLY SINCE AROUND, UH, 2015 OR SO, WE'VE, UH, MAINTAINED THAT ESSENTIALLY 60 40 SPLIT.
I THINK THE POINT I WANNA MAKE HERE, AND I THINK IT'S VERY IMPORTANT TO APPRECIATE, UH, IS THAT THERE'S CHANGE EVERY YEAR.
AND, UH, YOU KNOW, YOU COULD SEE CHANGE ONE TO TWO, UH, POINTS, UH, EITHER WAY, JUST DEPENDING ON, UM, A VARIETY OF, UH, CIRCUMSTANCES.
AND SO THE 58 42 IS VERY MUCH STILL IN LINE, UM, WITH, UM, WITH WHAT YOU SEE.
I THINK, UH, IN PARTICULAR WITH, UM,
[01:55:01]
A VERY LIMITED, UH, NEW CONSTRUCTION REALLY BEING BROUGHT ON ONLY $134 MILLION OF NEW CONSTRUCTION BEING ADDED, UH, TO THE TAX ROLLS THIS YEAR.ONCE WE SEE, UH, CONSTRUCTION STARTS RETURN, AND WE START TO SEE THAT CAPITAL INVESTMENT BY BUSINESS AGAIN, I, I WOULD EXPECT THAT THAT, UH, 58.244 TO RETURN TO THAT 59 OR 60%.
UM, BUT ALWAYS A, UH, ALWAYS AN INTERESTING, UH, TREND TO LOOK AT.
UH, STILL VERY STRONGLY, UH, FAVORED, UH, ON THE, THE, UH, OVERALL TAX BURDEN ON THE COMMERCIAL SIDE OF THINGS.
SO THIS SLIDE DEFINITELY WILL, UH, LOOK FAMILIAR TO YOU, UM, BUT I'M GONNA GO THROUGH IT JUST AS A, AS A BASIS OF FOUNDATION.
UH, SO JUST AS A REMINDER, OUR PROPERTY TAX RATE IS THE ADOPTED, UH, TAX RATE THAT'S ASSESSED ON THE TAXABLE VALUE OF REAL BUSINESS, PERSONAL, UH, PROPERTY.
IT'S COMPRISED OF TWO COMPONENTS, THE MAINTENANCE AND OPERATIONS, OR M AND O THAT GOES TO THE GENERAL FUND FOR GENERAL SPENDING.
AND THEN THE DEBT RATE THAT IS USED TO, UH, COVER THE DEBT SERVICE, UH, UM, AND, UH, GOES TO THE DEBT SERVICE FUND TO PAY THAT OUTSTANDING DEBT.
UH, YOU HEAR THE TERM NO NEW REVENUE RATE.
THAT'S THE RATE, THAT'S THE TAX RATE THAT WOULD BE ADOPTED TO GENERATE APPROXIMATELY THE SAME REVENUE AS THE PRIOR YEAR.
ESSENTIALLY THE VOTER APPROVAL RATE, UH, COMING OUTTA SB TWO AND SOME OF THE CHANGES THAT WAS, UH, ENACTED THERE, UH, IS THE HIGHEST RATE THAT A CITY COUNCIL CAN ADOPT WITHOUT A MANDATORY RATIFICATION ELECTION.
UM, THIS RATE ALLOWS, UH, THE 3.5% TAX CAP THAT WE BECOME SO FAMILIAR WITH.
SO IT ALLOWS YOU TO COLLECT 3.5% MORE REVENUE FROM PROPERTY TAXES, UM, THAN IN THE PRIOR YEAR.
UM, UNLESS YOU HAVE INCREMENT AND INCREMENT IS, UM, GENERATED OR CREATED WHEN, UH, IN A TAX YEAR, YOU ACTUALLY DON'T REACH THREE AND A HALF PERCENT.
SO LET'S JUST SAY FOR PURPOSES ONE YEAR WE'RE AT 3.25.
WELL, THE INCREMENT THAT WAS CREATED THAT YEAR, AND THAT CAN BE USED FOR UP TO THREE ADDITIONAL YEARS IS 0.25.
UH, CURRENTLY WE HAVE 0.00493, UM, OF, UH, INCREMENT THAT IS AVAILABLE TO US, AND, UM, THIS YEAR WILL BE THE THIRD YEAR THAT THAT, UM, UH, WILL, UH, EXPIRE IF IT'S NOT UTILIZED.
UM, IN TERMS OF, UM, UM, OUR, UM, OUR RATE, THE PUBLISHED VOTER APPROVAL RATE THERE INCLUDES THE TOTAL INCREMENT, UH, AVAILABLE TO THE CITY AS, UM, AS WE'LL SEE AS WE GET TO, UM, A, A LATTER LATER SLIDE HERE.
SO IF YOU LOOK AT THE CURRENT RATE, IT'S THAT 56 0 9 5, AND YOU SEE THE, THE DIFFERENCE BETWEEN AN M NO AND THE DEBT.
IF YOU DON'T WANNA GENERATE ANY NEW REVENUE, YOU WOULD ADOPT A 50, UH, POINT 51 0 8 RATE, AND YOU CAN SEE HOW THAT WOULD IMPACT BOTH THE M AND O AND THE, AND THE DEBT RATE.
UH, THE VOTER APPROVAL RATE, UH, WITH, UH, WITHOUT THE INCREMENT WOULD BE THAT 5 3 7, 2 5, AND THEN THE VOTER RATE WITH THE INCREMENTS JUST SLIGHTLY HIGHER THAN THAT AT THE 0.54218.
THIS IS A GOOD CHART, I THINK, TO HELP KIND OF ILLUSTRATE WHAT WE'RE TALKING ABOUT.
YOU SEE THE CURRENT RATE ON THE LEFT, UM, YOU SEE WHERE THE PROPOSED RATE IS, UM, AND YOU CAN KIND OF SEE WHAT WE'RE, WE'RE, WE'RE SUGGESTING HERE IS, UH, GIVEN, UM, THAT THIS IS THE LAST YEAR TO USE THAT, THAT SMALL INCREMENT.
AND GIVEN SOME OF THE CHALLENGES WE'RE HAVING WITH OTHER REVENUE SOURCES AND THE UNCERTAINTY AROUND THAT, WE'D LIKE TO PROPOSE TO USE THAT INCREMENT AND NOT, UH, NOT LET IT FALL OFF AND, UM, AND NOT BE AVAILABLE AGAIN IN THE FUTURE.
AND SO, UM, THAT'S THE 5 4 2 1 8 RATE THAT YOU SEE THERE.
UM, THAT RATE COMPARES, UM, FAVORABLY, UH, TO, TO OTHERS AT A 1.877, UH, CENT REDUCTION.
UH, YOU CAN KIND OF SEE THE PROPOSED RATE WHERE THAT WOULD PUT US IN OUR, UH, IN COMPARISON TO OTHER CITIES.
NOW, SOME OF THESE OTHER CITIES, JUST DEPENDING ON THEIR SITUATION, MAY ALSO ADJUST THEIR RATE.
AND SO MUCH LIKE THE, UH, COMP SURVEY, THIS IS A POINT IN TIME AND, UH, REALLY WON'T KNOW UNTIL ALL THE CITY BUDGETS ARE ADOPTED WHERE WE WILL END UP, UM, COMPARED.
UM, THIS IS A CHART THAT I, I WANTED TO SHARE JUST TO KINDA SHOW HISTORICALLY WHERE THAT 5 4 2 1 8 RATE WOULD PLAY A SI.
SO YOU'VE GOTTA GO ALL THE WAY BACK TO BEFORE THE BOND PROGRAM OF 2006 TO BE AT A RATE BELOW, UM, AT OR BELOW, UH, THAT FIVE FOUR TWO ONE EIGHT.
SO RECALL IN OH SIX, THE VOTERS APPROVED A BOND PROGRAM WITH A TAX RATE INCREASE AGAIN, IN, UH, 2010 VOTERS APPROVED A BOND PROGRAM WITH A TAX RATE INCREASE.
THEN IN 2015, WE WERE ABLE TO, UH, IMPLEMENT A 1 CENT REDUCTION, UH, THAT CARRIED ALL THE WAY THROUGH 2021 WHEN ANOTHER 1 CENT REDUCTION WAS, UH, ISSUED.
AND THEN LAST YEAR, UM, UH, I'M SORRY, IN 2022, UM, A, UH, A LARGE REDUCTION, I THINK THAT WAS ABOUT, UH, IF I REMEMBER RIGHT, THAT WAS ABOUT 5.40 CENTS OR SO, UH, REDUCTION.
AND, UH, AND THEN THIS YEAR, UH, THE 1.877, UM, SO AGAIN, A RETURNING TO A PROPERTY TAX RATE, UH, THAT'S NOT BEEN AS LOW AS THIS IN OVER, UH, JUST ABOUT 20 YEARS OR SO.
SO HOW DOES THAT IMPACT? UH, IN THE RESIDENTIAL SIDE, YOU CAN KIND OF SEE, UH, THE CURRENT RATE, UH, WITH THE, UM, WOULD, WOULD RESULT IN AN AVERAGE RESIDENT TAX INCREASE OF ABOUT $204 OR 10.37%, AN
[02:00:01]
AVERAGE SENIOR INCREASE OF ABOUT $145 OR 10.32% WITH, UH, THE VOTER APPROVAL RATE, INCLUDING THE INCREMENT, UM, FACTORING THEN THE 1.88 CENT REDUCTION, UH, THE AVERAGE RESIDENT TAX INCREASE WOULD BE 1 31 OR 6.6, UH, 8%, AND THE AVERAGE SENIOR INCREASE WOULD BE 93, UH, DOLLARS AND 57 CENTS FOR 6.63.UM, SO THE AVERAGE RESIDENT BILL YOU SEE THERE AT THE BOTTOM, THE CURRENT RATE 2175, THE VOTER APPROVAL RATE WITH THE INCREMENT 2102 FOR A SAVINGS OF $72, UH, OR A SAVINGS OF $52 IN THE AVERAGE SENIOR BILL.
UM, JUST SO YOU CAN KIND OF GET A SENSE OF THE ENTIRE BILL.
UM, SO YOU SEE HERE THAT, UM, UM, WE BREAK IT OUT BETWEEN THE CITY OF RICHARDSON RICHARDSON, ISD, DALLAS COUNTY, DALLAS COLLEGE PARKLAND, AND THEN WE DO THE SAME THING, UH, FOR, UH, PLANO SD COLLIN COUNTY COLLEY COLLEGE.
UM, AND YOU CAN KIND OF SEE THE 2102, UM, IN BOTH SITUATIONS AND HOW THAT COMPARES TO OTHERS.
UH, OUR BILL BEING ABOUT 25% OF THE TOTAL TAX BILL AND IN, IN, UH, COLLIN COUNTY BEING ABOUT 29.3% OF THE TOTAL TAX BILL, UM, ONCE, ONCE A PUBLIC HEARING IS CALLED, UM, THE CITY IS REQUIRED BY STATE LAW TO POST THE NOTICE OF THAT PUBLIC HEARING, UM, WITH THE VARIOUS RATES IN THE DALLAS MORNING NEWS.
UH, OF COURSE, UH, NOTICE IS ALSO POSTED ON THE CITY'S WEBSITE.
UH, THIS IS A, UH, KIND OF A EXCERPT FROM THAT NOTICE.
YOU CAN KIND OF SEE WHAT WE REPORT IS THE TOTAL TAX RATE, UH, 22 VERSUS 23 IN THE CHANGE AVERAGE HOMESTEAD TAXABLE VALUE TAX ON AVERAGE HOMESTEAD TOTAL TAX LEVY ON ALL PROPERTIES.
AND WE COMPARE THAT BETWEEN 23, 20 23 AND 2024.
MY RECOMMENDATION TO YOU IS TO, UM, TOMORROW NIGHT AFTER WE CONCLUDE THIS BRIEFING, YOU'LL HAVE TWO MORE ACTION ITEMS. UH, MY RECOMMENDATION IS, UH, AND I ASK YOU TO CONSIDER SETTING A PUBLIC HEARING, UM, UM, ON SEPTEMBER 9TH FOR THE PROS TAX RATE OF 54 2 1 8.
UM, AND AGAIN, THAT IS THE, UH, VOTER APPROVE RATE WITH THE INCREMENT.
JUST A COUPLE OF FINAL THOUGHTS, MAYOR.
UM, FIRST OF ALL, THANK YOU SO MUCH, UM, FOR, UM, UM, YOUR AT ATTENTI THIS TONIGHT.
I'M VERY EAGER TO NOW GET INTO THE CONVERSATION PART OF THE, THE, THE DISCUSSION AND, AND HEAR FROM YOU.
UM, HONESTLY, UM, YOU KNOW, SIX OR EIGHT WEEKS AGO, I DIDN'T THINK THAT I WOULD BE PRESENTING THIS BUDGET.
UM, WE'VE, UH, VERY FORTUNATE, IN MY OPINION, TO BE ABLE TO, UM, APPROVE A BUDGET THAT REDUCES THE TAX RATE, INCREASES THE SENIOR, UH, TAX EXEMPTION INCREASES SPENDING ACROSS THE BOARD ON INFRASTRUCTURE INCREASES SPENDING FOR PUBLIC SAFETY, UM, UM, ACKNOWLEDGES THE IMPORTANCE OF ATTRACTION AND RETENTION OF TALENT, UM, INCREASES.
UM, OUR MINIMUM, UM, UM, SALARY FOR, FOR EMPLOYEES, UM, AGAIN, REALLY FOCUSES AND REINVEST IN PUBLIC SAFETY VIA THE, THE STEPS, CAPITAL EQUIPMENT REPLACEMENT, MENTAL HEALTH CARE THAT WE CONTINUE ON WITH AND EXPANDED COMMUNITY PROGRAM.
UM, AND THEN REALLY USES OUR, UH, PEGO CAPITAL REPLACEMENT AND, AND IT FUND TO, UM, UM, BE ABLE TO PROVIDE THE DEPARTMENTS WITH ALL THEIR HIGHEST PRIORITY ITEMS. UM, NOT EVERY ITEM, BUT ALL OF THEIR HIGHEST PRIORITY ITEMS AS THEY DEFINED IT.
AND SO, UM, WE DO ALL THAT AND MAINTAIN A FUND BALANCE OF 90.99 DAYS, UM, WHICH IS, WE'VE WORKED SO HARD FOR OVER THE LAST DECADE TO ACHIEVE.
UM, I, I THINK IT'S A, A VERY, UH, GOOD BUDGET CONSIDERING ALL OF THE FACTORS THAT, UM, ARE WORKING AGAINST US.
AND, UM, I'D LOVE TO HEAR FROM YOU, MARIN, FROM THE COUNCIL, AND ANSWER ANY QUESTIONS THAT YOU MIGHT HAVE.
I'LL OPEN IT UP TO COUNCIL ALSO, BUT I WILL, I'LL JUST SAY THAT I THINK THAT YOUR EFFORTS ARE VERY HONORABLE AND THEY'RE VERY MUCH IN STEP WITH THE TACTICS OF THE GOALS OF THIS COUNCIL.
AND SO I PERSONALLY, I'M VERY PLEASED IN HOW YOU HAVE STRATEGICALLY HAVE DONE IT.
I LOVE THE FACT THAT YOU HAVE THE PAY AS YOU GO IN MANY INSTANCES WHERE WE'RE NOT INCURRING ADDITIONAL DEBT ON SEVERAL OF THOSE ITEMS WHEN POSSIBLE.
SO ANYWAY, I'D LOVE TO HEAR FROM THE REST OF THE COUNCIL, BUT I'LL JUST THROW THOSE, THOSE WEREN'T TERMS THAT WERE ACTUALLY USED A WHOLE LOT, BUT I THINK IT WOULD BEHOOVE US NOT TO IDENTIFY THAT AT, AT THIS TIME.
DON AND BOB AND THE REST OF THE TEAM.
I MEAN, I THINK WE GOT THROWN A, A LUCKY BREAK THERE AT THE END WITH THE PROPERTY TAX FOR SURE.
AND, UM, I'M REALLY HAPPY WITH THE BUDGET THAT WE HAVE NOW, THEN THAT YOU'RE PRESENTING EVERYTHING I'VE SEEN SO FAR.
I LIKE, I JUST HAVE A FEW SURE.
SORT OF, UH, RELATIVELY MINOR, ALMOST MORE DIRECTIONAL QUESTIONS.
UM, AND ONE ACTUAL NUMBERS RELATED QUESTION.
UM, JUST REALLY QUICKLY WITH THE ECONOMIC DEVELOPMENT STRATEGY, WHENEVER I WAS FIRST ON COUNCIL, IT SEEMED LIKE OUR FOCUS WITH THE IQ WAS REALLY TRYING TO WORK ON SORT OF IMPROVEMENTS TO SOME OF THOSE, UM, MORE LIKE 1970S,
[02:05:01]
EIGHTIES WAREHOUSE SPACES AND SORT OF PART OFFICE PART WAREHOUSE SPACES.AND DO I HAVE THE RIGHT IMPRESSION THAT REALLY WE'RE SHIFTING OUR STRATEGY NOW TO PRIMARILY FOCUS ON RENOVATING OFFICE SPACES AND RETAIL SPACES? IS THAT AN ACCURATE SORT OF 20 WORD ASSESSMENT OR, UH, I WOULD SAY IT'S, IT'S A, IT'S A VERY, IT'S A, IT'S A VERY GOOD QUESTION.
I WOULD SAY THAT WE HAVE NOT, UM, CHANGED OUR PRIORITY IN THE IQ.
A BIG PART OF THE IQ STRATEGY IS TO, UM, ADAPTIVELY ADAPTIVELY REUSE A LOT OF THE FLEX OFFICE SPACE THERE THAT NO LONGER IS VIABLE.
IT DOESN'T HAVE THE CLEAR ROOF HEIGHTS, IT DOESN'T HAVE THE KIND OF DOCKS THAT ARE NEEDED.
UM, THE REASON WE'RE NOT SEEING MORE, UH, OF THOSE BUILDINGS UPDATED AND MORE OF THOSE BUILDINGS BEING MODERNIZED IS RIGHT NOW, UM, IT'S, IT'S ALMOST AS COST EFFECTIVE TO BUILD A NEW BUILDING AS, AS IT IS TO DO A LOT OF THOSE IMPROVEMENTS, UH, BECAUSE OF THE INTEREST RATES YOU MIGHT PAY ON A REMODEL, FOR INSTANCE, VERSUS A NEW BUILD.
AND SO, UM, I THINK THAT, UM, I THINK THAT THAT IS STILL A BIG PART OF THE, UH, OVERALL ECONOMIC DEVELOPMENT STRATEGY INCLUDE IN, IN, IN THE IQ IS TO MODERNIZE THOSE BUILDINGS AND, AND HAVE THEM BROUGHT UP TO DATE OR REDEVELOP 'EM, UM, WHICH IS, WHICH IS ALSO AN, AN AN OPTION AND PART OF THE STRATEGY, I JUST BELIEVE THAT, UM, LIKE WE SEE THROUGHOUT THE CITY AND REALLY WE SEE ALL ACROSS, YOU KNOW, DALLAS, AUSTIN, AND HOUSTON CONSTRUCTION STARTS, UH, WHETHER IT BE RENOVATION OR NEW, NEW BUILDS HAVE REALLY JUST ALMOST COME TO AN HALT.
AND I THINK THAT'S PROBABLY THE MAIN DRIVER OF WHY WE'RE NOT SEEING MORE BUILDINGS IN THE IQ TURNOVER.
YEP, THAT MAKES, THAT MAKES SENSE.
AND, UM, IT WAS JUST, AGAIN, IT WAS JUST SOMETHING THAT I DIDN'T SEE IN THIS PRESENTATION, SO I WANTED TO, TO UNDERSTAND SORT OF THE BROADER STRATEGY THERE.
SO I APPRECIATE THE CLARIFICATION.
UM, AND THEN REAL QUICK AS WELL FOR SPEAK ON ECONOMIC DEVELOPMENT, UM, MAYBE YOU CAN JUST, I FEEL LIKE I JUST DIDN'T CATCH THE FIRST TIME AROUND, YOU KNOW, YOU MENTIONED MOVING ONE POSITION OUT FROM ECONOMIC DEVELOPMENT MM-HMM.
BOB, DID I GET THAT RIGHT? SO WHAT, I GUESS I JUST DIDN'T CATCH WHAT ELSE ACCOUNTS FOR THAT? SURE.
SO THE, THERE'S A, THE PER THE CURRENT POSITION IS A MARKETING AND PLACE MAKING MANAGER.
SO WE'RE TAKING THE MARKETING POSITION AND WE'RE PUTTING THAT UNDER, UM, GREG'S TEAM.
SO THERE'S, AND THE NEW SALARY AND ALL THE COST ASSOCIATED WITH THAT POSITION WILL BE IN GREG'S SHOP.
AND IF YOU LOOK ON THE LINE ITEMS, YOU'LL SEE, I THINK IT'S COMMUNITY OR COMMUNICATE OR, UH, CITIZEN'S INFORMATION ON YOUR, ON YOUR FUND SUMMARY.
YOU'LL SEE THAT NUMBER IS UP 20%.
BECAUSE THE SALARY AND ALL THE ASSOCIATED COST OF THAT EMPLOYEE IS IN THAT POS THAT POSITION, THE PLACEMAKING FUNCTION, UM, IS NOW BEING, UH, GONNA BE AT LEAST IMMEDIATELY WILL BE UNDER THE, THE GUIDANCE OF OUR CITY MANAGER'S OFFICE.
UM, THOSE COSTS, UM, AND, AND INCLUDING THE EVENTS WHICH WERE FORMERLY IN THE ECONOMIC DEVELOPMENT DEPARTMENT ARE NOW IN THE TIF.
UM, THAT'S WHERE THEY WERE ORIGINALLY.
THAT'S WHERE THEY WERE ORIGINALLY.
AND UNTIL WE DECIDE LONG TERM WHERE THE PLACEMAKING FUNCTION IS GONNA BE HOUSED, I THINK THAT WE'LL, WE'LL HAVE IT UNDER THE CMO GUIDANCE INITIALLY, AND THEN IT'LL EVOLVE.
AND SO IT'S REALLY THE, IT'S, IT'S NOT, IT'S NOT IN ANY WAY, SHAPE OR FORM A DECREASE OR A DEFUNDING OF ECONOMIC DEVELOPMENT.
IT'S A, UM, IT'S A REPOSITIONING TO WHAT LONG TERM I BELIEVE IS THE RIGHT PLACE IN COMMUNICATIONS AND WHAT IS THE RIGHT PLACE NOW FOR THE, UH, FOR THE MARKETING AND, AND FOR THE PLACEMAKING.
UM, FOR THE TIME BEING, BEING IN THE CITY MANAGER'S OFFICE UNTIL WE KIND OF DEFINE A LONGER TERM PLAN, DON THAT AND THAT 100% MAKE SENSE.
I JUST, UH, I DIDN'T, I HEARD ALL THOSE FACTS.
I DIDN'T REALLY CATCH THAT SECOND PART THAT THE PLACEMAKING WAS GONNA BE SOMEWHERE ELSE, BUT, BUT IT IS REALLY RELEVANT.
I GET ASKED, UM, KIND OF ALMOST ODDLY, UM, THE PAST COUPLE MONTHS I'VE BEEN ASKED VERY SPECIFIC QUESTIONS ABOUT EMPLOYEES AND ECONOMIC DEVELOPMENT MM-HMM.
SO I THINK THIS CLARIFICATION IS REALLY HELPFUL FOR PEOPLE.
AND THEN, UM, MY FINAL, MY FINAL QUESTION IS REALLY JUST ON, ON BACK TO SLIDE 25 ON THE PROPERTY TAX REVENUES.
I KNOW IT'S A LONG WAY TO GO BACK, SO WE CAN ALL PROBABLY JUST REFERENCE ON OUR, OH, WOW.
UM, JUST REALLY QUICKLY, I GUESS I JUST DON'T UNDERSTAND, I JUST DON'T UNDERSTAND THE SECOND TWO PARTS OF THESE, THE PRIOR TAXES.
UM, OR REALLY JUST THE SPECIFICALLY, SPECIFICALLY, I JUST, I'M JUST NOT REALLY UNDERSTANDING WHAT YOU'RE TRYING TO SAY HERE.
[02:10:01]
PROPERTY TAXES ARE UP THIS YEAR, THAT MAY NOT BE THE CASE IN THE NEXT COUPLE YEARS AND IT MAY ACTUALLY BE DOWN? IS THAT WHAT THIS IS TRYING TO SAY? YEAH, THE, THE PRIOR YEAR TAXES, SO, UM, THE MAJORITY OF WHAT'S AFFECTING PRIOR TAXES ARE, ARE LAWSUITS.SO WHEN YOU GO THROUGH, YOU KNOW, THE EVALUATION PROTEST, YOU GO THROUGH THE A RB PROCESS, UM, AND THEN AT THE END OF THAT, IF YOU'RE STILL NOT SATISFIED, YOU HAVE THE, THE RIGHT TO, UM, FILE A, A LAWSUIT IN DISTRICT COURT.
A LOT OF TIMES THOSE TAKE LONGER THAN, THAN A SINGLE YEAR.
SO BECAUSE THOSE ARE FOR TAXES ON A YEAR PRIOR TO THE YEAR WE'RE IN, THAT AFFECTS THAT SEPARATE CATEGORY.
AND WHAT WE'RE SEEING IS LESS FAVORABLE, A LOT MORE LAWSUITS, FIRST OF ALL.
AND NOW WE'RE A LOT SEEING A LOT MORE LESS FAVORABLE OUTCOMES OF THOSE LAWSUITS.
WHERE THE DISTRICT COURT IS, IS, UM, UH, RULING IN FAVOR OF THE, THE, UH, PROTESTOR VERSUS THE APPRAISAL DISTRICT.
SO, AND THAT'S JUST BECAUSE THEY'RE CROSSING FISCAL YEARS, THOSE ADJUSTMENTS JUST HIT THAT SUBCATEGORY.
IF THEY DID SETTLE AND THIS YEAR WE WOULD SEE A REDUCTION IN THE CURRENT YEARS, UM, COLLECTIONS.
YEAH, I GET, AND JOE, YOU CAN IMAGINE IF THEY'RE WILLING TO SPEND THAT KIND OF MONEY TO TAKE IT TO DISTRICT COURT, THEY'RE BIG CASES.
YEAH, THAT'S, THAT'S DEFINITELY HARD.
SO THEN BACK UP TO THE TOP PART, THIS CURRENT TAXES COMMERCIAL OFFICE SECTOR VALUES ARE DOWN 9.4%.
AND SO JUST HELP REMIND ME ON THIS PICTURE AGAIN, BUT OVERALL, OVERALL, WE'RE UP RIGHT NOW AGAIN, ARE WE SAYING THAT THAT THAT'S STILL GONNA BE THE CASE TWO, THREE YEARS FROM NOW? ARE WE SAYING WE DON'T KNOW, OR WHAT IS THIS? YOU KNOW, I, THE, THE, THE, YOU'RE EXACTLY RIGHT.
THE REASON I MADE THIS POINT IS BECAUSE WE DON'T KNOW.
AND, BUT IT'S SOMETHING THAT, UM, IT, WE HAVE TO BE REALLY MINDFUL AND CONTINUE TO WATCH WHAT COMMERCIAL VALUES ARE DOING IN GENERAL, HOW MANY LAWSUITS ARE BEING FOLLOWED ON COMMERCIAL PROPERTIES.
WHAT ARE THE OUTCOMES OF THOSE, THOSE LAWSUITS.
AND SO OF, UM, YOU KNOW, WHEN YOU THINK ABOUT COMMERCIAL OFFICE SECTOR BEING DOWN ALMOST 10%, IT'S NOT GONNA TAKE MUCH FOR A COUPLE OF OTHER SECTORS TO MAYBE COOL OFF AND NOT HAVE AS MUCH OF AN INCREASE.
AND THEN THAT IMPACT BECOMES MUCH MORE SUBSTANTIAL.
AND SO, UM, OR IF THE COMMERCIAL OFFICE MARKET CORRECTS AND IT'S DOWN 20% IN ONE YEAR, YOU KNOW, THAT'S GONNA HAVE, THAT COULD, THAT COULD HAVE BEEN A SIGNIFICANT IMPACT TO THE ADDITIONAL $2.6 MILLION REVENUE THAT WE DID GENERATE FROM SALES TAX.
SO IT WAS MOSTLY JUST, IT WAS MOSTLY JUST AN INDICATION OF, WHILE WE HAVE $2.6 MILLION MORE IN SALES TAX, THERE'S A REALLY IMPORTANT SECTOR THAT'S DOWN 10%.
AND I BELIEVE IT'LL CONTINUE TO BE DOWN YOU FOR PROBABLY THE NEXT TWO TO THREE YEARS, WHILE A LOT OF LEASES THAT WE KNOW ARE GONNA EXPIRE COME DO, UH, OR OWNERS HAVE TO MAKE DECISIONS ABOUT, YOU KNOW, WHETHER THEY'RE JUST GONNA GIVE THE BUILDING BACK TO THE BANK AND BE DONE WITH IT.
AND THEN THE BANK JUST DECIDES, WELL, WE'RE JUST GONNA HOT SALE IT AND SELL IT FOR, YOU KNOW, PENNIES ON THE DOLLAR, JUST SO THEY DON'T HAVE TO KEEP IT IN THEIR PORTFOLIO.
I DON I THINK THIS GOES BACK TO WHAT I SAID AT THE VERY BEGINNING OF THIS TOO.
WE GOT THAT SORT OF TWO POINT, IT'S A 2.9 MILLION LUCKY, LUCKY BREAK.
IT'S A PRETTY RAZOR THIN LUCKY BREAK TO GET THOUGH, ISN'T IT? IT'S SO, YEAH.
ARE YOU, YOUR QUESTION AND ANSWERED, UH, GO AHEAD.
THANK, THANK, THANK YOU, MAYOR.
UM, JUST TO, FIRST OF ALL, THANK YOU VERY MUCH.
UM, I, I REALLY AM HAPPY TO SEE THAT WE HAVE THE ADDITIONAL FUNDING IN THE HOTEL, UH, MOTEL TAX TO, AND I SUPPORT THAT $1 MILLION MOVING OVER TO THE GENERAL FUND, WHICH I THINK IS EXCEPTIONAL.
I, I NOTICED THAT WE ARE GONNA STILL CONTINUE TO SUPPORT NETWORK AND CARES.
I I MAY HAVE MISSED THIS, BUT DID WE HAVE IN THERE FOR THE CITIZEN FIRE ACADEMY AND, AND THE POLICE ACADEMY AS WELL? OR ARE WE CONTINUING ON WITH THIS? YES, ABSOLUTELY.
THEY'RE IN THEIR, THEY'RE IN THEIR, UH, BUT THEIR, THEIR DEPARTMENTAL BUDGETS.
I, I JUST DID, I GUESS I JUST DIDN'T SEE THAT.
UM, ALSO, UH, THE MATCHING FUNDS, I NOTICED THAT WENT FROM 20,000 TO 25,000 FOR THE MINIMUM.
'CAUSE IT WAS, I THINK IT'S ALWAYS BEEN 20,000 FROM MY UNDERSTANDING, A MINIMUM TO MAKE OR TO GET THE MATCHING FUND REQUIREMENT IS FOR THE HOME IMPROVEMENT INCENTIVE PROGRAM.
I THOUGHT IT WAS 20, BUT OKAY.
IT'S, IT'S, THAT'S FOR THE MATCHING FUND THEN.
ARE YOU, BUT YOU'RE ASKING FOR THE HOME IMPROVEMENT INCENTIVE? FOR THE HOME IMPROVEMENT, IT REMAINS, IT'S REMAINING AT 20.
AND, UH, THE OTHER QUESTION I HAVE IS ON THE 88 TRANSITION PLAN, OTHER THAN JUST THE AADA A COMPLIANT RAMPS THROUGHOUT THE CITY, WHAT ELSE DOES THAT EN ENTAIL? SO IT'S, IT'S A WIDE VARIETY OF, OF INFRASTRUCTURE AT, AT, AT INTERSECTION.
IT COULD BE RAMPS, UM, IT CAN BE THE AUDIBLE CROSSWALK SIGNALS,
[02:15:01]
UM, AT CROSSWALKS AND OUR FACILITIES.IT COULD BE THINGS LIKE DOOR HANDLES, UM, AND EVEN THE HEIGHTS OF, OF TVS AND THINGS ON THE WALLS.
UM, AND THEN THERE'S EVEN A COMPONENT OF THIS IN OUR, OUR WEBSITES.
ARE WE USING CONTRASTING COLORS FOR PEOPLE THAT MAY BE VISUALLY IMPAIRED? SO IT'S A WHOLE WIDE VARIETY OF, OF THINGS THAT THEY'LL LOOK AT.
I WAS JUST WONDERING IF 150,000 IS ENOUGH TO, TO COVER THOSE EXPENSES.
SO, UM, THE INTENT IS FOR US TO, UH, APPLY FOR A GRANT WITH THAT THERE IS, UM, A, A, UM, A LOT OF GRANT OPPORTUNITIES FOR THINGS LIKE THIS.
AND SO WE THINK THAT WITH A, AN AN 80 20 MATCH, SO THAT 150 WOULD HOPEFULLY BE OUR 20% MATCH, AND THAT WOULD ALLOW US TO GET A $750,000, UM, TOTAL, UH, BUDGET FOR THE A DA TRANSITION PLAN.
I MEAN, I FEEL LIKE THAT'S REALLY IMPORTANT, UH, FOR THE CITY AND, AND JUST IN GENERAL FOR INFRASTRUCTURE, BUT, SO 150,000 IS GENERALLY A GOOD, A GOOD NUMBER FOR THAT? WE BELIEVE SO.
OKAY, MS. JUSTICE, ARE YOU, IS YOUR LIGHT ON OR OFF THIS TIME? YEAH, SORRY, WE JUST HAVE TOO MANY MICS ON SO I CAN HANG IT OFF.
I KNOW WE WERE HAVING AN ELECTRICAL OVER OVERLOAD
WE WERE, UM, I WANNA ECHO, UH, COUNCILMAN CORCORAN'S REMARKS, YOU KNOW, YOU KNOW, FOUR, SIX WEEKS AGO, I THINK WE WERE ALL, YOU KNOW, SORT OF SWEATING A LITTLE BIT.
YOU KNOW, WE WERE, WE WERE REALLY WORRIED, UM, OUR PROPERTY TAX GROWTH WAS GONNA BE A LOT LESS THAN IT WAS.
UM, AS IT IS, YOU KNOW, INCREASING A BUDGET, A MILLION OR SO DOLLARS IS, AS COUNCILMAN GORAN SAID, PRETTY, UH, RAZOR THIN.
UM, SO KUDOS TO YOU AND YOUR TEAM FOR FIGURING OUT HOW TO MAKE THIS WORK AND REALLY FOCUSING ON THE THINGS THAT THE COUNCIL HAS PRIORITIZED.
UH, I KNOW IT'S PRIORITY FOR YOU TOO.
UH, RETENTION AND, AND INFRASTRUCTURE, PUBLIC SAFETY.
UH, AND I THINK IT'S SMART FOCUS ON ECONOMIC DEVELOPMENT TOO.
I, I MEAN, YOU MADE THE POINT THAT, UM, UH, 42, 58 ISN'T THE END OF THE WORLD.
UH, BUT OBVIOUSLY THAT'S SOMETHING THAT'S IMPORTANT TO US AS WELL.
SO I THINK ECONOMIC DEVELOPMENT IS SOMETHING THAT'S VERY IMPORTANT FOR US TO BE FOCUSING ON TO MAKE SURE THAT THAT TREND DOESN'T, UH, GO IN, IN THE WRONG DIRECTION, UM, IN THE NEXT FEW YEARS.
UNDERSTANDING A LOT OF THE MARKETS NOT SORT OF WITHIN OUR CONTROL, BUT I THINK THAT YOU AND YOUR TEAMS ARE DOING A REALLY SMART JOB OF REALLY FOCUSING ON ECONOMIC DEVELOPMENT.
UM, I JUST A FEW RANDOM QUESTIONS.
UM, UH, MR. KLEIER ON, ON INTEREST, UH, WE'VE BUDGETED HIGHER FOR INTEREST RATES, EVEN THOUGH WE SAW THOSE HEADLINES, AND THERE'S SORT OF NO WAY TO PREDICT WHAT'S GONNA HAPPEN.
I THINK YOU ADDRESSED THE ISSUE A LITTLE BIT, BUT WE'VE, WE'VE GONE UP SOMETHING LIKE $2 MILLION IN WHAT WE'RE BUDGETING ON INTEREST.
UH, WHY DO WE FEEL COMFORTABLE THAT THAT'S SORT OF ACCURATE IN COMPARE COMPARISON TO PREVIOUS YEARS WHEN PROBABLY, IF ANYTHING, INTEREST RATES ARE GONNA COME DOWN? CAN YOU DIVE INTO THAT A LITTLE BIT? UM, I, I THINK WHAT WE'RE PROJECTING FOR NEXT YEAR IS, IS, WELL, FOR THIS YEAR, I THINK IT'S 2.7 MILLION, WHICH IS IN LINE WITH WHAT WE HAD, UM, ACTUALS IN FY 23, UM, AT 2.7 MILLION FY 23.
AND AGAIN, THE, THE HIGHER INTEREST RATES AND THEM NOT COMING DOWN, UH, DURING THIS YEAR, WHAT WE, WHICH, WHICH WE'RE PLANNING FOR IS ALLOWING US TO, UH, STILL FINISH THIS YEAR ABOVE BUDGET ABOUT 2.7 MILLION.
UH, THE OTHER PART OF THAT IS WE HAVE HIGHER FUND BALANCES THAN WE DID A YEAR AGO, WHICH ALSO IMPACTS OUR, OUR INVESTING, UH, AS WELL AS THE LONGER TERM INVESTMENTS THAT ARE LOCKING IN THESE HIGHER INTEREST RATES, UM, THAT WE'LL SEE, UM, THE HIGHER DIVIDENDS FROM OVER THE NEXT, UM, NEXT YEAR, YEAR AND A HALF OR SO.
SO MORE THAN ANYTHING, IT'S, IT'S THE SORT OF THE LONG-TERM INTEREST RATE THAT ALLOWS US TO FEEL CONFIDENT THAT, THAT WE CAN BUMP THIS UP SLIGHTLY FROM THE PRIOR BUDGET, IF I UNDERSTAND WHAT YOU'RE SAYING.
I THINK THAT THE, THE FY 24 BUDGET AGAIN INCLUDED WHAT WE ANTICIPATED BEING UP TO THREE RATE REDUCTIONS.
AND SO, UH, WE'RE, WE'RE FINISHING THIS YEAR STRONGER.
UM, THE FY 25 BUDGET IS, IS BRINGING THAT BACK DOWN A LITTLE BIT.
BUT, UM, YOU KNOW, WE'RE NOT SURE NECESSARILY, YOU KNOW, HOW MANY RATE REDUCTIONS OR WHAT RATE THEY ARE, BUT WE THINK WE'RE ALSO INSULATED BASED OFF OF SOME OF THOSE LONGER TERM INVESTMENTS.
I JUST DON'T WANT US TO GET INTO A SALES TECH SITUATION WHERE WE'VE SORT OF, UH, WE'VE FELT CONFIDENT 'CAUSE OUR INTEREST RATES HAVE BEEN LIKE, REALLY GREAT, SO WE'RE GONNA HAVE A REALLY STRONG BUDGET HERE AND THEN IT, IT NOT BE GOOD.
SO IT SOUNDS IT, AS EVERYTHING YOU DO, I KNOW IS REALLY BASED IN DATA AND SORT OF BASED ON, ON WHAT WE UNDERSTAND OUR LONG-TERM INTEREST RATES WILL BE.
UM, I JUST SORT OF LOOKED AT THAT AND IT MADE ME, UM, A LITTLE CONCERNED JUST THAT WE WERE INCREASING BASED ON SUCH A VOLATILE THING, UM, AS THE HEADLINES FROM YOUR PRESENTATION SHOWED.
SO, UH, THANK YOU FOR EXPLAINING WHY WE FEEL COMFORTABLE WITH, WITH THAT INCREASE.
UM, MY OTHER QUESTION RELATES TO THE AMBULANCE REVENUE.
YOU DID A GOOD JOB OF SORT OF TALKING ABOUT IT.
WHEN I FIRST LOOKED AT IT, THIS WAS A MASSIVE INCREASE FROM THE PRIOR YEAR BUDGET.
WE'RE TALKING ALMOST $1.1 MILLION.
SO IT REALLY STOOD OUT LIKE, WHOA, WHAT ARE, WHAT ARE WE DOING DIFFERENTLY HERE? SO I JUST WANNA SPEND A MINUTE ON THIS.
IT'S NOT SORT OF AN ARTIFICIALLY INFLATED NUMBER AS YOU'VE EXPRESSED.
[02:20:01]
AND THEN WE'VE JUST DONE BETTER OWN COLLECTING.AND SO CAN YOU JUST SPEND ANOTHER MINUTE ON, ON WHY WE FEEL LIKE THIS IS A TREND? WE FEEL COMFORTABLE AND, YOU KNOW, WE'RE ALWAYS, UH, REALLY CAREFUL NOT TO INCREASE OUR BUDGET A LOT.
THIS IS A LOT, RIGHT? SO WHY DO WE FEEL SO CONFIDENT THAT WE CAN GO UP A MILLION DOLLARS WHEN WE'RE BUDGETING? YEAH, I MEAN, IF YOU, IF YOU, UH, GO BACK AND LOOK AT FY 23 AGAIN AT, AT 3.1 MILLION, AND THAT'S WHERE WE'RE ANTICIPATING COMING IN THIS YEAR.
SO WE'RE, WE'RE REALLY NOT SEEING AN INCREASE FROM 23 TO 24.
THE, THE, THE BUDGET FOR 24 WAS, UH, UNFORTUNATELY, UH, MISSED.
WE, UH, WE WEREN'T NECESSARILY SHOW, WE, WE THOUGHT SOME OF THAT WAS ONE-TIME REVENUE, BUT AFTER MORE DIGGING IN WITH FIRE THAT IT IS A CHANGE IN THEIR, THEIR INTERNAL PROCESSES ON REVIEWING BILLS AS THEY GO OUT.
UH, WE ARE PROJECTING, UH, YOU KNOW, BUDGET TO BUDGET ONE POINT MILLION, BUT AGAIN, THAT I BELIEVE THAT THAT, UH, 2.4 MILLION THAT WE ADOPTED AS PART OF THIS YEAR'S ADOPTED BUDGET WAS JUST TOO LOW.
UM, GOING FROM THE ESTIMATE TO BUDGET, IT'S 347,275,000 IS A RESULT OF THAT RATE INCREASE.
UH, SO THE, THE ACTUAL INCREASE IS, IS, YOU KNOW, BUDGET, WHAT THE RESTATED BUDGET FOR FY 24 2 NEXT YEAR, MINUS THE RATE INCREASE INCREASES, IS ABOUT A HUNDRED THOUSAND.
AND WE, WE DO BELIEVE THAT BASED OFF OF THE CURRENT TRENDS, CURRENT PRACTICES, THAT THAT FIRE HAS IN PLACE, THAT THAT IS A REALISTIC NUMBER.
THANK YOU FOR EXPLAINING THAT.
LIKE I SAID, JUST ON PAPER, THAT, THAT FEELS LIKE A BIG JUMP.
SO IT'S, IT'S GOOD TO UNDERSTAND WHY.
UM, I'M WONDERING IF THIS IS BACKWARDS OR IF I'M JUST MISUNDERSTANDING IT RELATED TO THE PAVILION RENTAL.
IT, IT SHOWS THE RESIDENCE, THE, THE REV THE REVENUE IMPACT FOR RESIDENTIAL IS 3,200 AND NON-RESIDENT IS 1600.
SO IT SEEMS LIKE THAT SHOULD BE BACKWARDS, OR IS IT RESIDENTS RENT IT MORE AND THAT'S WHY.
I WAS THINKING WE WERE CHARGING RESIDENTS MORE BY LOOKING AT THAT, BUT IT'S REALLY, THEY JUST RENT THE COURT.
UM, UM, I HAVE A COUPLE MORE QUESTIONS, BUT I NEED TO ORGANIZE MY THOUGHTS, SO I'LL LET SOMEONE ELSE GO.
AND THANK YOU THE OTHER BOARD FOR GIVING THIS DETAILED BUDGET PRESENTATION.
AND THANK YOU, UH, YOU KNOW, OUR CITY MANAGER, UH, MR. DON MAGNER FOR BRINGING THIS, UH, WONDERFUL BUDGET THAT TWO WEEKS AGO WE THOUGHT WOULD BE DIFFERENT THAN WHAT YOU HAVE SHOWN TODAY.
UH, I'M GONNA ASK YOU ONE LITTLE TECHNICAL QUESTION TO UNDERSTAND, UH, UH, IT'S ABOUT THE MIMO SUBPAR LIGHT, THAT UPGRADE THAT YOU HAVE.
CAN YOU EXPLAIN THAT, UH, WHAT BENEFIT THAT WOULD BRING? I'M, I'M SORRY, CAN YOU REPEAT MOST PART? THE LIGHTING, THE LIGHTING THAT MR. MARK HAD TROUBLE? WELL, RIGHT NOW, RIGHT NOW, A RIGHT NOW A A A PARTNER OF THE CITY THAT HAS THE, THE, UM, CREDENTIALS, THE, THE LIGHT ISN'T ABLE TO BE TURNED ON AND OFF.
IT'S, IT'S, IT'S NOT AS USER FRIENDLY.
AND SO THIS WILL, THIS WILL GIVE, UM, UM, RESIDENTS WHO HAVE THE, THE, UM, AUTHORITY TO GO OUT AND PRACTICE ON THE FIELDS, THE ABILITY TO TURN ON AND OFF THE LIGHTS.
I THINK THAT WILL SOLVE ONE OF THE PROBLEMS THAT WE TALKED, WE DISCUSSED LAST YEAR THAT SOME RESIDENTS WANTED TO USE THAT.
AND WERE NOT ABLE TO USE, I'M GLAD THAT YOU HAVE THAT NOW, SO I'M SURE I CAN GO BACK AND SHOW MY FACE
UM, NOW THERE IS ONE THING THAT, YOU KNOW, AS I KNOW THAT THE, THE RESIDE RESIDENTIAL VERSUS COMMERCIAL THAT WE ARE TALKING ABOUT, MM-HMM.
AND I, YOU KNOW, I SEE THAT THAT TREND IS TO CONVERSE SOME OF THE RES, UH, COMMERCIAL OFFICE BUILDING INTO RESIDENTIAL, UH, AND, UH, WHICH IS GREAT.
UH, BUT THAT MEANS THAT SOME OF THE OFFICE BUILDING WOULD BE TAKEN OFF FROM THE MARKET CONVERTED TO RESIDENTIAL, AND THE TAX WOULD BE COMING FROM THE RESIDENTIAL.
SO SOMETIMES, EVEN THOUGH IF THE RATE SHOWS THAT COMMERCIAL IS DROPPING BUT IS INCREASING BECAUSE OF THE COMMERCIAL RIGHT.
TRANSFER A ACTUALLY RESI, MULTI-FAMILY RESIDENTIAL IS GONNA BE IN THE ORANGE LINE IN THE COMMERCIAL LINE.
HOW ABOUT THE TOWN HOMES? IT WOULD, THAT WOULD BE, TOWN HOMES WOULD BE IN THE BLUE.
SO IF THE NUMBERS ARE LITTLE, YOU KNOW, NOT INSIGNIFICANT, PROBABLY IT'S NOT GONNA SHOW MUCH.
BUT IF THAT TREND GOES SIGNIFICANT OTHER WAY, PROBABLY IT'S A GOOD IDEA TO TRACK THAT INDIVIDUALLY JUST TO SEE ABSOLUTELY.
UH, YOU KNOW HOW THAT'S GOING WITHOUT GETTING PANICKED SOMETIMES.
AND THEN I HAVE FEW QUESTION, UH, WHICH IS, I'M GLAD THAT YOU KNOW, THAT PUBLIC SAFETY INVESTMENT
[02:25:01]
THAT HAS GONE UP 27% PLUS LAST, UH, THREE YEARS.AND, UH, ALSO IN, UH, INFRASTRUCTURE MAINTENANCE PROGRAM THAT ALSO HAS GONE UP 27% LAST THREE YEARS.
AND THAT PROPOSED TAX RATE CUT, UH, LAST FOUR YEARS, I SEE THAT IS OVER 13%.
UH, AND THEN, UH, SENIOR CITIZEN, CITIZEN, THE HOME EXEMPTION THAT THEY HAVE 145,000 PROPOSED, THAT'S, THAT'S, UH, REALLY GREAT.
SO THESE ARE ALL POSITIVE LAST THREE YEARS.
I, UH, YOU KNOW, I'M GLAD THAT I'M ENJOYING THIS GOOD TIME AND GOOD BUDGET PLANNING.
UH, ONE THING I SEE THAT ON THE SALES TAX, UH, THAT'S, YOU KNOW, YOU'RE PROJECTING LOWER THAN LAST TWO YEARS, BUT STILL THAT'S PRE MORE THAN PRE PANDEMIC, RIGHT? UH, YEAH.
THAT, THAT'S STILL MORE THAN PRE PANDEMIC.
I THINK THAT'S STILL VERY POSITIVE.
UH, YEAH, THE, UH, THE FY 20, UH, 21 YEAR WAS 46.9.
SO I GUESS YOU FEEL PRETTY, I GUESS I SEE THAT YOU ARE, YOU ARE VERY CONFIDENT THAT, UH, THERE IS NO CHANCE TO GET THIS THING EVEN LOWER.
UH, W WE, WE FEEL, AS BOB MENTIONED, WE FEEL LIKE THIS IS A VERY PRUDENT, UH, ESTIMATE.
UM, BUT IF FOR SOME REASON, UM, IN THE FIRST QUARTER, YOU KNOW, FIRST HALF OF 20, UH, FY 25, WE WERE CONTINUING TO MISS THE ESTIMATE.
WE DO HAVE A RESERVE SET ASIDE TO OFFSET THAT SO WE DON'T HAVE TO MAKE ADDITIONAL CUTS.
UM, AND SO I, I DO FEEL IT'S A, IT'S A, IT'S A, IT'S A CONSERVATIVE, BUT A, UM, I THINK A RESPONSIBLE STRATEGY, UM, TO, TO TAKE IT.
AND, UM, YOU KNOW, IT'S, IT'S THAT 3%, 3.1% LESS THAN THE, THAN WHERE WE BELIEVE, UH, WILL END UP AT THE END OF THIS YEAR.
SO, I MEAN, JUST WANTED TO SEE THAT.
I'D LIKE TO SEE YOUR CON FACE THAT YOU'RE COMPETENT ON THAT.
UH, THE OTHER THINGS THAT WE HAVE NOT SEEN RED CUT INTEREST, RED CUT THIS YEAR.
BUT DURING OUR LAST MEETING IN THE DMRC THAT WE HAD, THE MONTHLY MEETING THAT WE HAD, THE DISCUSSION WAS THAT, UH, FEELING WHAT THAT, THAT THERE WOULD BE LIKE THREE RED CUT MAYBE NEXT FEW MONTHS.
AND, UH, IF THAT HAPPENED, I THINK MM-HMM,
SO, UM, I STRONGLY BELIEVE ALSO TO THAT, YOU KNOW, THE RED CUT IS, IS DUE NOW.
SO I THINK WE'RE CONSERVATIVE ON THAT SENSE.
SO, UH, UM, I MEAN, HAP HAPPY ABOUT THAT NOW, THE AMBULANCE FEEDBACK, I SEE THAT, YOU KNOW, UH, JENNIFER HAD, UH, TALKED ABOUT ALREADY THAT IT LOOKS LIKE, YOU KNOW, MORE THAN IT, LIKE WHEN IT IS LIKE ONE TIME JUMP, IT LOOKS LIKE MORE AND THERE WOULD BE MORE ADDITIONAL FEE BECAUSE, UM, THE MEDICINE USE AND OTHER THINGS.
SO SOMEONE, WHOEVER USED THAT, THEY'RE GONNA SEE, UH, THE CLAIM WOULD BE MORE THAN THEY USED TO.
AND, UH, BUT NOT NECESSARILY ALL THE TIME, THE INSURANCE PAY, EVERYTHING, UH, 'CAUSE SOMETIMES IT'S, IT GOES TO THE DEDUCTIBLE.
SO, I MEAN, IF YOU SEE THERE IS A STRESS ON SOMEONE'S, YOU KNOW, COST, YOU KNOW, EXPENSE, UH, HOW, IS THERE ANY PROGRAM THAT THAT COULD BE USED TO HELP THEM OUT? UH, NOT NECESSARILY FROM THE CITY OR MAYBE SOME OTHER SOURCE? UM, YEAH, YEAH, YOU WANNA TAKE IT, I, I DO KNOW THROUGH THE FIRE DEPARTMENT WHEN IT COMES TO DELINQUENT COLLECTIONS THAT THEY DO HAVE SOME CONTACTS WITH SOME NONPROFITS THAT DO HELP ASSIST WITH THAT.
I DON'T HAVE THE SPECIFICS ON WHAT THOSE ARE, AND WE CAN DEFINITELY, UH, GET SOMETHING FOR YOU.
BUT I DO KNOW THAT THERE IS, UM, PROGRAMS THAT THEY, THAT THEY CAN PUT PEOPLE IN, IN TOUCH WITH THAT WOULD HELP WITH THAT.
AND IN ADDITION, CHIEF VY, IF, I MEAN, IF IT WAS A, IF IT WAS A, UM, SITUATION, UM, THAT WARRANTED A CITY REDUCTION IN, IN, UM, THE, UH, INVOICE OR EVEN JUST TO ELIMINATE THE INVOICE, CHIEF POY HAS THE ABILITY TO MAKE THAT DECISION.
HE CAN REVIEW THAT, MAKE THAT DECISION.
SO IF IT WAS A, IF IT WAS A SITUATION, UM, WHERE, YOU KNOW, LET'S SAY IT WAS A SENIOR CITIZEN WHO HAD NO FUNDS TO PAY.
I MEAN, THAT WE CAN DEAL WITH THAT AS A UNIQUE SITUATION.
AND, AND, UM, AND I THINK, I THINK THE CHIEF AND HIS TEAM DO A GOOD JOB OF EVALUATING THOSE ON A CASE BY CASE BASIS.
[02:30:01]
WONDERFUL.I DON'T HAVE ANY ISSUE WITH THAT.
FIRST OFF, UM, DON AND THE ENTIRE TEAM, CONGRATULATIONS.
VERY, VERY APPRECIATIVE, UM, FOR ALL OF THE HARD WORK.
SO BUDGET, BOB, AS THEY, THAT'S YOUR NEW TITLE BUDGET, BOB.
UM, OVERALL, SO I'M VERY PLEASED WITH EVERYTHING THAT I SEE.
UM, JUST A COUPLE OF OF QUICK QUESTIONS AND THEN A COUPLE OF COMMENTS.
UM, FIRST IS, IF I REMEMBER CORRECTLY, AND CORRECT ME IF I DON'T REMEMBER THIS CORRECTLY, FIRST YEAR I WAS ON COUNCIL, SO, UH, SIX YEARS AGO I THINK WE HAD A CHART IN ADDITION TO SHOWING, UM, UM, WHAT THE OVERALL THE, THE, UM, AMOUNT OF COMMERCIAL VERSUS RESIDENTIAL.
WE ALSO HAD A CHART THAT SHOWED KIND OF AREA CITIES.
IS THERE ANY CHANCE THAT WE COULD TRY AND GET THAT AGAIN, JUST SO WE CAN KIND OF COMPARE OURSELVES? BECAUSE I KNOW, I KNOW BACK FIVE YEARS AGO AT THE TIME, WE WERE RIGHT AT THE 60 40 AND A AND MY RECOLLECTION WAS GARLAND WAS EXACTLY REVERSE OF THAT.
AND SO, UM, I THINK IT'D JUST BE NICE TO KNOW, YOU KNOW, AREA, CITIES WHERE, WHERE WE'RE AT ABSOLUTELY.
AS TO THE, AS TO WHERE WE'RE, WE'RE SITTING.
'CAUSE I THINK THAT THAT WOULD ALWAYS KEEP US IN A, YOU KNOW, A GOOD STATE IS TO KNOW WHAT'S HAPPENING, NOT ONLY FOR US, BUT FOR EVERYWHERE ELSE.
WE'LL MAKE THAT PART OF OUR, UH, BUDGET PRESENTATION.
UM, WHEN WE, AFTER WE FILE AND WE MAKE THE BUDGET PRESENTATION TOO, WE'LL MAKE A PART OF THAT.
I JUST THINK IT'D BE GOOD IF WE, WE SAW THAT ON A, ON A ROUTINE BASIS.
UM, SECOND QUESTION THAT I HAVE IS, I KNOW WE'RE RIGHT NOW IN THE MIDDLE, MIDDLE OF THE AQUATICS ASSESSMENT, BUT WE HAVE IN HERE THAT WE WERE, THAT WE'RE, UH, PROPOSING TO DO THE POOL RESURFACING AT $335,000.
SO ARE WE, ARE WE SAYING THAT WE'RE KIND OF GOING AHEAD AND GOING FORWARD WITH THAT, EVEN THOUGH WE'RE DOING THE AQUATICS ASSESSMENT? I'M NOT SAYING THAT THAT THAT ASSESSMENT'S GONNA COME BACK AND SAY DO ANYTHING DIFFERENT BY ANY STRETCH.
I'M NOT, BUT I'M JUST, I'M TRYING TO UNDERSTAND WHERE WE HOLD THAT, THAT 3 35 UNTIL WE GET THAT ASSESSMENT TO SAY THAT YES, DEFINITELY THE HEIGHTS POOL IS GONNA CONTINUE AND THERE'S NO MODIFICATION OR, OR I'M JUST TRYING TO UNDERSTAND THAT.
I THINK WE WOULD WANT TO GO AHEAD AND LAUNCH.
I THINK THAT ANY CAPITAL INVESTMENT THAT COMES OUT OF THE AQUATICS MASTER PLAN WILL BE, HAVE TO BE, YOU KNOW, ACCOUNTED FOR AND PLAN FOR.
SO IT COULD BE A NUMBER OF YEARS, IT MIGHT EVEN BE THE NEXT BOND PROGRAM, WHICH WOULD BE LIKELY 2026.
AND SO I THINK THAT TO MAKE SURE THAT THE, UH, THE REX, THE HEIGHTS AQUATIC CENTER, YOU KNOW, IS IN GOOD SHAPE AND, AND CAN CONTINUE TO BE USED FOR, WHETHER IT'S, YOU KNOW, FIVE YEARS OR, YOU KNOW, 10 YEARS, WHATEVER THE CASE MAY BE, UH, WE'D LIKE TO GO AHEAD AND TRY TO GET THAT DONE IN THE OFF SEASON, UM, AND MAKE SURE THAT IT'S READY FOR NEXT YEAR.
AND I, AND I SUSPECT, I MEAN, I, I, I REALLY SUSPECT THAT THE HEIGHTS AQUATIC CENTER IS GOING TO BE A KEY ELEMENT, YOU KNOW, MOVING FORWARD IN THE AQUATICS.
WELL, MAYBE THERE'LL BE SOME SUGGESTIONS ON HOW TO IMPROVE IT, BUT I THINK IT'LL CONTINUE TO BE A, ONE OF OUR MAIN ASSETS IN THE AQUATICS REALM.
AND, AND I DON'T DISAGREE WITH THAT AT ALL.
SO IN CASE WE'RE ASKED THAT QUESTION, IT'S LIKE, YOU KNOW, YOU'RE DOING AN ASSESSMENT YET.
AND THEN, THEN JUST KIND OF, AND I'M GONNA MAKE A COMMENT AND DON YOU CAN EITHER AGREE OR DISAGREE WITH ME.
SO, UM, THIS YEAR, THIS FISCAL YEAR, NOT WHAT WE'RE LOOKING AT TONIGHT, YOU KNOW, WE, WE, UM, I THINK MYSELF AND A COUPLE OTHER COUNCIL, UH, MEMBERS, A PUSH TO INCREASE IN SALARIES FOR, FOR CITY, FOR ESPECIALLY FIRE POLICE AND FOR EVERYONE, UM, YOU KNOW, AT THE TIME WE ALL FELT THAT IT WAS VERY NEEDED.
UM, AND I THINK YOU, YOU AT THE SAME TIME FELT IT AS WELL AND FELT THAT IT WAS SOMETHING THAT WE COULD TAKE ON AND THAT IT WAS AN APPROPRIATE POSITION TO TAKE.
AND FROM WHAT YOU SAID TONIGHT, UM, IS I, I FEEL LIKE YOU SAID THAT THAT'S AN ABSOLUTE TRUE STATEMENT AND THAT WE'VE NOT AFFECTED THE NA THE CITY NEGATIVELY IN ANY WAY, SHAPE, OR FORM, OR HAD TO MAKE MAJOR, MAJOR CUTBACKS OR ANYTHING ALONG THOSE LINES, BECAUSE WE DID, I BELIEVE IT WAS AN EXTRA, AN ADDITIONAL 1%.
UM, BUT THAT ACTUALLY, WHEN I LOOK AND I SEE THE NUMBER OF, UM, OF THE VERY, VERY, VERY LOW VACANCIES MM-HMM,
AND I JUST, UH, YOU KNOW, AND AGAIN, I'M NOT TRYING TO PUT WORDS IN YOUR MOUTH, BUT I WOULD LOVE TO HEAR SURE.
IF YOU, IF YOU AGREE WITH THAT STATEMENT OR YOU THINK I'M WAY OFF BASE OR WHATEVER THE CASE MIGHT BE.
YEAH, NO, I'M, I APPRECIATE THE CHANCE TO RESPOND TO THAT.
I, I THINK YOU'RE, UH, VERY CORRECT.
I THINK THAT THE, THE, UH, COMPENSATION, THE MARKET ADJUSTMENTS AS WELL AS THE STEPS, AS WELL AS A LOT OF THE OTHER STRATEGIES, UM, HAS BROUGHT US DOWN FROM A, A HIGH OF ABOUT 18 VACANCIES IN SWORN POLICE OFFICERS, UM, TO, UM, REALLY WHAT AMOUNTS TO FOUR.
AND WE WERE DOWN TO TWO JUST LESS THAN TWO WEEKS AGO.
[02:35:01]
AND I CAN TELL YOU THE AMOUNT OF OVERTIME THAT WE SAVE FROM HAVING A FULL STAFF AND NOT REQUIRING OFFICER OFFICERS TO WORK MANDATORY OVERTIME, UM, IS A HUGE OFFSET TO THE ONE, THE ADDITIONAL 1% THAT, THAT WE, UM, INCREASED FROM THE FIVE TO THE 6% LAST YEAR.AND SO, UM, I THINK THAT IT'S, UM, IT'S, IT'S, IT'S HELPED NOT ONLY IN PUBLIC SAFETY, BUT IT ALSO HELPED IN THE MARKET, UM, POSITION OF A LOT OF, UM, THE OTHER, UM, NON-SWORN PUBLIC SAFETY POSITIONS AS WELL AS GENERAL GOVERNMENT.
AND, UM, I WOULD ARGUE THAT THERE, THERE'S A, THERE'S A VARIETY OF SAVINGS ACROSS THE ORGANIZATION THAT ARE BEING REALIZED BECAUSE WE ARE NOW ABLE TO RECRUIT AND RETAIN EMPLOYEES.
AND WE BROUGHT A ATTRITION NUMBER DOWN FROM NINE, UM, YOU KNOW, TO, TO LESS THAN 7% IN JUST REALLY TWO SHORT YEARS.
UM, AND, UM, SO, BUT JUST THE OVERTIME ALONE, UM, BOB, AGAIN, CHECK ME ON THIS.
'CAUSE
SO I, I THINK IT'S ABSOLUTELY, UH, BEEN A HUGE, UH, IMPACT, UM, TO RECRUITMENT AND RETENTION AND THE OPERATIONAL SAVINGS THAT WE'RE REALIZING, UH, OFFSETS, UM, A BIG PART OF THAT ADDITIONAL 1%.
I JUST, AND I, AND I APPRECIATE IT BECAUSE I KNOW THAT, YOU KNOW, THERE WAS A LITTLE BIT OF DISCUSSION ABOUT THAT AND I WANTED TO MAKE SURE THAT WAS OUT ON THE, ON THE RECORD.
AND, YOU KNOW, AGAIN, I THINK, UM, JUST THIS WEEKEND ALONE HAD THE OPPORTUNITY TO INTERACT WITH, UM, SEVERAL PEOPLE, UM, WHO MAY, YOU KNOW, COMMENT TO ME AGAIN ABOUT HOW MUCH THEY APPRECIATE OUR CITY, HOW PROFESSIONALLY IT'S RUN, UM, HOW CITY SERVICES ARE SO RESPONSIVE.
AND, YOU KNOW, I THINK THAT, YOU KNOW, HAVING AN OUTSTANDING CITY STAFF, CITY, UH, MANAGER, ALL OF THE ASSISTANT CITY MANAGERS, OUR CFO, OUR BUDGET, BOB AND EVERYONE WHO TAKES PART, I TOLD YOU I WAS GONNA USE IT.
UM, ALL OF THE PEOPLE THAT ARE INVOLVED IN IT, IT JUST SHOWS THAT WHEN YOU'VE GOT A PROFESSIONALLY RUN CITY, ALONG WITH A VERY, UH, UH, ATTENTIVE AND CARING CITY COUNCIL THAT I THINK WE ARE, AND I'LL JUST SAY THAT ON ALL, ALL OF OUR BEHALF, EVEN YOU, JOE.
'CAUSE YOU LOOKED AT ME FUNNY.
UM, YOU KNOW, I, I THINK, I THINK THAT'S HOW WE GET THOSE REMARKS BACK UNSOLICITED.
I WASN'T OUT THERE LOOKING FOR COMPLIMENTS, BUT PEOPLE, UM, IN FACT, THIS ONE GENTLEMAN DIDN'T EVEN ACTUALLY KNOW I WAS ON CITY COUNCIL.
I, I, AFTER HE MADE HIS COMMENTS, I REMINDED HIM.
UM, BUT, YOU KNOW, I THINK IT'S, I THINK IT'S JUST CONTINUES TO SHOW THE LEVEL OF, OF PROFESSIONALISM AND DETAIL TO, TO THAT THAT IS EXHIBITED, UM, EVERY YEAR.
AND, AND THIS IS MY SIXTH BUDGET AND I'M INCREDIBLY PROUD, UM, TO, TO SEE, UM, WHAT DETAIL Y'ALL GO THROUGH, THAT YOU GET IT DOWN, LITERALLY DOWN TO THE PENNY.
UM, SO I JUST WANNA SAY THANK YOU, VERY PROUD, VERY HAPPY WITH WHAT YOU'VE DONE.
AND SO CONGRATULATIONS TO YOU AND THE ENTIRE STAFF.
MR. BARRIOS, UH, THANK YOU MAYOR.
UM, AND EVERYBODY ELSE, 'CAUSE I KNOW IT'S NOT JUST DON, BUT IT'S IMPOSSIBLE TO NAME EVERYBODY INVOLVED WITH THIS BUDGET.
SO THANK YOU FOR ALL THE HARD WORK, UH, TO KINDA BEGIN WITH ECHOING A LITTLE BIT OF WHAT, UH, COUNCIL MEMBERS CORCORAN AND JUSTICE SAID IT, IT WAS CLOSE AND, UH, Y'ALL DID A HECK OF A JOB AND, UH, LITTLE, LITTLE CLOSE FOR COMFORT, BUT THAT'S OKAY.
RIGHT? TEST, TEST SOME SKILLS AT SOME TIME, UH, IN A DIFFERENT WAY AT TIMES.
I'VE GOT A FEW DIFFERENT QUESTIONS.
MY FIRST QUESTION ACTUALLY, SLIDE 17, AND TO BE HONEST, I DIDN'T, I DON'T KNOW IF I FULLY HEARD AND UNDERSTOOD, UH, AMERIPRO TE'S QUESTION, BUT IT MAY HAVE PARTIALLY BEEN ANSWERED BY HIS QUESTION EARLIER.
UM, THE, ON THE CALL OUT, IT SAYS FY UH, SO THIS 3.3 0.1%, AND CORRECT ME IF I'M WRONG, I JUST FOR CLARIFYING, CLARIFYING HERE, THIS IS LESS THAN WHAT WE'RE ENDING THE YEAR, BUT WHAT IS IT IN COMPARED TO WHAT WE ORIGINALLY PROJECTED A YEAR AGO? 'CAUSE THAT, I THINK THAT GAP IS MUCH LARGER, RIGHT? MM-HMM.
AND DO YOU KNOW, MORE OR LESS, I'M NOT GONNA HOLD YOU TO IT, SO IF YOU'RE POINT SOMETHING OFF, BUT 9.1% DOWN FROM THE ORIGINAL FY 24 BUDGET AND 11% DOWN FROM WHERE WE FINISHED IN FY 23.
SO, SO IT'S WANTED TO PUT THAT IN PERSPECTIVE.
I DIDN'T REALIZE IT WAS QUITE THAT BIG.
[02:40:01]
DOUBLE THIS.UM, THANK YOU SO MUCH FOR THAT.
THE ON SLIDE, KIND OF A GENERAL COMMENT ON SLIDE 52, PUBLIC SAFETY PAY SURVEY COMPARISON.
UM, I KNOW IT'S OUR GOALS IN COMPARING WHEN, WHEN WE LOOK AT THIS, UM, AGAIN, OR WHEN IT'S SHOWN, NOT JUST IN THIS CASE, I JUST CALLED OUT THIS SLIDE, BUT WHEN WE'RE COMPARING, CAN WE JUST BE REMINDED OF WHAT CITIES WE'RE COMPARING TO IN THAT PARTICULAR SLIDE? JUST 'CAUSE WE'VE PROBABLY, OFF THE TOP OF MY HEAD, IF I GOT QUIZ RIGHT NOW, I COULDN'T NAME EVERY CITY WE'RE COMPARING THIS TO, AND I'M, I'M GUESSING, UM, MOST OF US COULDN'T.
SO WHILE WE MAY BE ABLE TO NAME ONE OR TWO, IT'S ALWAYS GOOD TO KIND OF HAVE THAT ON TOP OF OUR HEAD FRESH AND FOR THOSE WATCHING HOME TOO.
UM, ON SLIDE 57, UM, PUBLIC SAFETY, POLICE COMMUNITY RELATIONS AND PROGRAMS, IT SHOWS A 10,000 INCREASE.
I KNOW LAST YEAR AS PART OF THE BUDGET, WE ALSO INCREASED IT A BIT.
I DON'T REMEMBER, BUT IT WAS, I THINK, A LITTLE BIT LESS THAN THAT.
I THINK IT WAS ACTUALLY 10,000 TOO.
SO I WANTED TO, UM, JUST KINDA SAY GREAT JOB.
I, I LOOK FORWARD WHEN, UH, CHIEF VISITS US NEXT TO KIND OF HEARING HOW THEY, UM, HOW THEY DO THAT.
JUST 'CAUSE I THINK THAT'S DEFINITELY ONE OF THE, UM, I GUESS OUR, ONE OF THE OPPORTUNITIES THAT'S, UH, OUT THERE IN GREENFIELD.
I KNOW LAST YEAR THEY DID THE, UH, FOR SEPTEMBER IT WAS IN THE POLICE DEPARTMENT.
I'D LOVE TO SEE THAT MORE OUT IN THE COMMUNITY WHERE THE PEOPLE ARE VERSUS LETTING PEOPLE.
SO I'M DEFINITELY EXCITED TO SEE WHAT, UH, CHIEF AND HIS STAFF DOES WITH THAT, UH, AS THEY CONTINUE TO GROW THOSE PROGRAMS. UM, SLIDE 65, GENERAL FUND, NEW REVENUE USE, SLIDE RIGHT THERE.
SO CAN YOU, UM, ATTRITION, WE TALKED ABOUT ATTRITION.
IS THIS PRETTY, I THINK, UH, LET'S SEE.
HOW WOULD YOU SAY, WE TALKED ABOUT HOW IT'S, HOW, UH, WE'RE DOING BETTER OVER THE LAST FIVE YEARS.
ARE WE, ARE WE SEEING THAT AS A BETTER TREND? HAS IT KIND OF DONE THIS? LIKE HOW DOES THAT COMPARE TO WHAT WE SEE IN THE AVERAGE IN A FIVE OR 10 YEAR LOOK BACK? YEAH.
SO, UM, HERE'S A, HERE'S KIND OF A, UH, IF YOU LOOK AT THE, THE BOTTOM LINE THERE ON THE LEFT CHART, THE PERCENT VACANT.
PRIOR TO COVID, IT WAS RIGHT AT 5%, UM, FOR MOST OF 22 AND 23, AND ACTUALLY 21 AS WELL.
21 WAS A LITTLE TRICKY 'CAUSE WE HAD FROZEN POSITIONS, BUT, UM, IT WAS CLOSER TO 9.5%.
SO, UM, AGAIN, YOU KNOW, THE 3% ASSUMPTION IS LESS THAN HALF OF WHAT OUR CURRENT VACANCY IS.
AND I DON'T, YOU KNOW, WE'D HAVE TO HAVE ABOUT 40 TO GET DOWN TO 3%.
WE'D HAVE TO HAVE ALL BUT ABOUT 35 TO 40 POSITIONS IN THE CITY FIELD.
WHICH NEVER IN 28 YEARS, I'VE NEVER SEEN IT.
SO I THINK THE 3% IS A, YOU KNOW, THE 3% IS A, UM, IS A VERY REASONABLE ASSUMPTION.
ANY ORGANIZATION OF THIS SITE IS JUST GONNA HAVE CHURN FOR SO MANY DIFFERENT REASONS.
I I DON'T DISAGREE WITH YOU AT ALL ON THAT.
I WAS JUST KIND OF CURIOUS LIKE WHAT I GUESS THE LARGER TRENDS ARE AND HOW THAT AFFECTS, YOU KNOW, UM, SO I CAN SEE WHERE 3% IS DOABLE, BUT MAYBE IF WE WERE TO SAY 6%, WELL, THAT'S SUCH A HUGE JUMP BECAUSE OF THE UP AND DOWNS.
UM, THAT MAY NOT BE DOABLE, BUT 3% I, I AGREE WOULD BE GREAT.
UH, SLIDE 67 HOTEL FUND TRANSFER.
SO HELP ME UNDERSTAND, UM, THE MILLION DOLLARS OUTLAW, I LOVE THE IDEA OF WHAT IT'S GONNA BE USED FOR, AND THERE WAS NOTHING ON THERE THAT FOR ME, RAISED ANY FLAGS OR CONCERNS OR ANYTHING I WOULD, YOU KNOW, CHALLENGE OR DISAGREE WITH.
HOW DOES THIS, WHAT EFFECT DOES THIS HAVE ON THE ACTUAL FUND? IS IT GONNA, UM, I MEAN, IT'S JUST AFFECTING THE FUND.
IT'S NOT AFFECTING FOR THOSE AT HOME WHO MAY BE, UH, CONCERNED ABOUT HOW IT MAY AFFECT SOME OF THE PROGRAMS THAT, THAT NORMALLY COMES.
NO, IT'S NOT, WE'RE NOT AT ALL NOT PAYING BUDGET ON ANY PROGRAMMING OR ANYTHING THAT THIS MILLION DOLLARS WILL.
SO CAN YOU KINDA JUST CLARIFY THAT? YEAH.
IT'S JUST, IT'S JUST A DRAWDOWN OF THE FUND BALANCE.
THE FUND BALANCE, BECAUSE WE TRANSFERRED $2 MILLION IN IS NOW YOU SAY OVER 200 DAYS.
IT'S, IT'S MORE THAN TWO TIMES WHAT WE HAVE FOR ANY OTHER FUND BALANCE.
AND SO ALL WE'RE DOING IS DRAWING DOWN THE FUND BALANCE AND KIND OF RETURNING,
[02:45:02]
UM, YOU KNOW, HALF OF THE $2 MILLION THAT WE TRANSFERRED IN, UH, BETWEEN 19 AND 21 BACK TO THE GENERAL FUND FOR THOSE ONE TIME REOCCURRING.BUT THERE WILL BE NO IMPACT TO SERVICES, PROGRAMS, OR ANY OTHER, UM, UM, YOU KNOW, FUNCTION THAT'S WITH, THAT'S HOUSED WITHIN THE HOTEL MOTEL, UH, AS A RESULT OF THAT TRANSFER OUT.
UH, SLIDE 87, GENERAL GOVERNMENT SLIDE, THE POINT, THE SECOND POINT READ STRATEGIES TO BROADEN DIVERSITY OF APPLICANTS ON BOARDS AND COMMISSION.
WAS THIS TIED TO SOMETHING SPECIFIC? WELL, I MEAN, I AGREE THAT THAT'S A GREAT THING.
I'M JUST COULDN'T, I DON'T THINK I COULD AT THIS POINT EXPLAIN WHAT EXACTLY THAT'S TIED TO.
IT'S, IT'S DRIVEN OUT OF YOUR COUNCIL TACTICS, RIGHT? AND SO IT'S, IT'S PROVIDING AMY WITH SOME ADDITIONAL RESOURCES TO CONTINUE HER OUTREACH AND, UM, AND MAYBE EVEN MM-HMM,
I MEAN, TO, TO GO OUT INTO THE COMMUNITY MORE, TO HAVE MORE OPPORTUNITIES TO, YOU KNOW, BE AT DIFFERENT EVENTS.
UM, UM, MAYBE EVEN, UM, UTILIZE SOME, A GROUP LIKE THE COMMUNITY INCLUSION ENGAGEMENT COMMISSION TO HELP HELP AND HAVE, YOU KNOW, BUT HAVE FUNDING AVAILABLE.
IT'S NOT MUCH, BUT TO HAVE FUNDING AVAILABLE TO TRY NEW THINGS, TO IMPROVE THE, UM, THE DIVERSITY OF THE, THE CANDIDATE POOL THAT WE'RE ABLE TO BRING YOU GUYS.
I THINK THAT'S, THAT'S, THAT'S GREAT.
AND, UH, I MEAN, AMY'S NEVER DONE ANYTHING WHERE I WOULD EVER THINK TO, SHE, SHE'S AWESOME.
CAN'T SAY ENOUGH GREAT THINGS ABOUT AMY
UH, SO, UM, LAST BUT NOT LEAST, THE, UH, THE, I KNOW THERE'S A LOT OF FOCUS ON ECONOMIC DEVELOPMENT, WHICH I THINK IS GREAT AND, AND WE NEED TO, AS WE FACE THESE CHALLENGES, UM, I KNOW WE CURRENTLY HAVE, UH, INTERIM DIRECTOR MM-HMM.
AND WHOEVER FILLS THAT POSITION, I HOPE IT'S SOMEBODY WHO'S A, A DEAR GENERATOR AND, UH, YOU KNOW, IT'S LIKE YOU AND ALWAYS HAVE A DIVERSE PORTFOLIO.
AND, UH, YOU DON'T WANNA PUT ALL YOUR EGGS IN ONE B BASKET.
AND, UH, LOOKING AT A COUPLE OF SLIDES AND GOING, OKAY, WELL, YOU KNOW, WE WERE TALKING ABOUT THE IMPACT OF COVID AND WHAT IT DID WITH, UH, OUR TECH.
AND WHILE TECH HAS ALWAYS BEEN MM-HMM,
IT'S BIG PART OF OUR HISTORY, AND WE'LL BE A BIG PART OF OUR FUTURE.
WE ALSO KIND OF WANNA SEE WHAT ELSE IS OUT THERE, WHERE THE NEED, AND I KNOW SOME OF THE STUFF THAT'S COME BEFORE THE COUNCIL, AT LEAST IN THE LAST YEAR, I'VE BEEN A PART OF THE COUNCIL.
UH, A COUPLE THINGS ARE REALLY EXCITING THAT I KNOW YOU WILL DISCUSS IN THE FUTURE.
UH, BUT, UH, I HOPE THAT WE CONTINUE TO KIND OF GENERATE THOSE OUT OF THE BOX THINKING BECAUSE, UH, WE DO NEED TO, YOU KNOW, MAKE SURE WE'RE, UH, SOMETIMES YOU, YOU, YOU HAVE TO TRY NEW THINGS.
AND, UH, WE'VE DONE REALLY GREAT AND THE, HIS, THE CITY HAS A GREAT HISTORY OF, UH, SOME GREAT SUCCESSES.
I LOOK FORWARD TO THANK YOU TO MORE OF THOSE AND, UH, SOME OF THOSE, UH, BIG IDEAS.
JUST A COUPLE MORE QUESTIONS ON THE, UM, UH, LIVING WAGE AND THE COMPRESSION ISSUE THAT YOU TALKED ABOUT.
BECAUSE SIMPLY, SIMPLY A LOAN, IT'S A, UM, IT'S AN 18, UM, $18, YOU KNOW, 42 CENTS OR $18 72 CENTS TO $22 MM-HMM.
AND MANY OF THE STARTING SALARIES FOR THE SUPERVISORS OF THESE FOLKS ARE AT 22, 20 $3.
AND SO IF YOU MAKE AN EQUIVALENT MOVE PERCENT MOVE UP, IT VERY, IT VERY QUICKLY HAS AN EXPONENTIAL RIPPLE UP.
AND, UM, I MEAN, IT IS, IT'S A HUGE PRIORITY OF MINE.
AND I WOULD, YOU KNOW, EVEN MID-YEAR, I MEAN, IT WOULD PROBABLY BE ONE OF THE FIRST THINGS THAT I WOULD COME BACK AND VISIT ABOUT IS HOW CAN WE, YOU KNOW, IF, IF CONDITIONS LEND THEMSELVES, I WOULD, I WOULD COME BACK AND VISIT ABOUT HOW CAN WE, UM, YOU KNOW, HOW CAN WE, AND, AND WHAT I, WHAT I TOLD THE, THE CITY STAFF, UM, IN, IN OUR, IN OUR FIVE TOWN HALLS WAS, YOU KNOW, I SAID, I ASKED FOR PATIENCE.
AND I SAID, LISTEN, YOU KNOW, YOU SAW THE COMMITMENT EACH OF THE FIRST TWO YEARS, UM, OR THAT EACH OF THE PAST TWO YEARS, AND THAT COMMITMENT REMAINS, UM, AND WE, WE WILL FIGURE OUT A MULTI-YEAR STRATEGY TO TRY TO, YOU KNOW, RESTORE IT AND GET BACK ON, GET BACK ON TRACK.
IT WAS JUST SUCH A, IT WAS THE WORST POSSIBLE YEAR TO HAVE THAT KIND OF AN INCREASE
THAT'S EXACTLY WHERE I WAS GOING, IS I KNOW IT'S A PRIORITY OF YOURS.
IT'S A PRIORITY OF OURS TOO, TO MAKE SURE THAT ALL OF OUR STAFF ARE AT A, ARE AT LIVING WAGE.
AND SO I I, I VERY MUCH ENCOURAGE YOU TO DO THAT.
IF WE HAVE A BETTER YEAR THAN WE'RE ANTICIPATING, THAT'S EXACTLY WHERE I WOULD HOPE THAT YOU WOULD GO WITH THOSE EXCESS FUNDS.
[02:50:01]
THERE'S EVEN MORE EXCESS, YOU KNOW, GOD WILLING, UM, THAT, THAT, THAT GO TO OUR STAFF AS WELL.UM, I THINK THAT, YOU KNOW, AS COUNCILMAN HUTCHIN WRITER SAID THAT THAT'S, IT'S ALWAYS A PRIORITY OF US, UH, OF OURS.
AND, UM, YOU'VE DONE A REALLY GOOD JOB THE LAST FEW YEARS OF MAKING SURE THAT, UM, YOU KNOW, OUR, OUR STAFF WANNA WORK HERE AND THAT PEOPLE WANNA COME WORK HERE, UM, AND, AND FOLKS WANNA STAY.
SO THAT, THAT'S, YOU READ MY MIND.
THAT'S EXACTLY WHERE I WANTED TO GO WITH THAT, THAT COMMENT.
JUST A COUPLE OF OTHER THINGS ON THAT, THE TREES, I THINK IT'S GREAT TO SORT OF GO AFTER GRANTS.
UM, YOU KNOW, AND I KNOW YOU SAID YOU DIDN'T ANTICIPATE WE'D SPEND A LOT MONEY THIS YEAR.
UM, SO I THINK THAT THAT'S A GREAT WAY TO, TO DO THAT.
THERE'S A LOT OF ORGANIZATIONS, SO I ENCOURAGE YOU TO DO THAT.
I THINK IT'S GREAT THAT WE'RE DOING IT, THAT WE'RE, WE'RE TRYING TO, YOU KNOW, I KNOW YOU'RE DOING A TREE SURVEY AND WE DON'T KNOW WHAT THE RESULTS OF THAT ARE, BUT WE'RE THINKING THOUSANDS OF TREES WERE LOST.
SO I THINK THAT THIS IS A, WILL MAKE A GREAT IMPACT.
UM, AND THEN JUST A QUESTION ON THE STORM IMPACT, AND WE WERE TALKING ABOUT MILLIONS OF DOLLARS THAT WE WEREN'T ANTICIPATING, UM, IS, I KNOW THAT WE'RE HOPING TO GET SOME OF THAT BACK