City Council - Regular Meeting

The Eccles St. James United Methodist Church. If everyone would please silence your cell phone. If you so choose, please stand and remain standing for the Pledge of Allegiance.

Good afternoon. Let us pray. Most gracious and eternal God, we thank you for the gift of this day and for the privilege of gathering together in service to the city of Beaumont. As your word has reminded us to do justice, to love mercy, and to walk humbly with you, we pray that these same virtues would guide us in this place this afternoon. We lift before you our mayor, the members of this city council, our city manager, and all who have been entrusted with the responsibility of leadership. Grant them wisdom in every decision, patience in every discussion, and discernment as they consider the needs of this city. Give them the courage to pursue what is just, the compassion to remember those whose voices may not always be heard, and the humility to recognize the weight of the responsibility they have been given. We pray for those who serve our city each day, for our city employees, first responders, law enforcement officers, firefighters, and all who work contributes to the safety and wellbeing of this community. Protect them, strengthen them, and bless them for the work of their hands. And God, we pray for the people of Beaumont, from every ward and every neighborhood, from our youngest to our oldest, may this be a city where people can live with dignity, opportunity, safety, and hope. Bless our families, our schools, our businesses, our churches, and our communities. Be near to those who are struggling, those who are hurting, and those who are in need. Now, Lord, guide the work that will take place in this meeting. May every conversation be productive, every decision be thoughtful, and every action taken be for the good of the people and the betterment of this city. May justice guide us. May mercy shape us. May humility keep us. And may your wisdom lead us as we seek a stronger and more united Beaumont, Texas. In the mighty name of Jesus the Christ, we pray. Amen. Amen.

I pledge allegiance to the flag of the United States of America and to the republic for which it stands, indivisible, Roll call, please.

Mayor West.

Present.

Mayor Pro Tem Crenshaw. Here. Council Member Turner. Here. Council Member Durio. Here. Council Member Hilliard. Here. Council Member Williams. Here. And Council Member Sherwood. Thank you.

Today we have a City of Beaumont communications update at this time.

GOOD AFTERNOON, EVERYONE. HERE ARE YOUR ANNOUNCEMENTS FOR THIS TUESDAY, AUGUST 18TH. VAUMAUT ZIP IS LOOKING FOR SOME POSSIBLE SERVICE CHANGES AND WE WANT RIDERS TO WEIGH IN. PROPOSED UPDATES INCLUDE CHANGES TO THE LAUREL NORTH 11TH ROUTE, SATURDAY OPERATING HOURS AND MORE FREQUENT SERVICE ON SELECT ROUTES ALL AIMED AT IMPROVING CONNECTIONS AND REDUCING OPERATING COSTS. The 30-day public comment period is now open. So head to beaumontzip.com slash survey to check out the proposal and to take the survey. Going once, going twice, everyone loves a good deal, and you'll find a lot of them at the City of Beaumont surplus property auction happening now. To browse the online auction items, go to Renovates.com and search City of Beaumont, Texas. Bidding closes at 10 a.m. on August 26th, so don't wait too long. Browse it, bid on it, and maybe bring it home. August is National Wellness Month, and with students heading back to school, this time of year can bring excitement, but also added stress. Through the City of Beaumont's partnership with Care Solace, residents can get free, confidential help for mental health and substance abuse, as well as housing, food assistance, low-cost medical and dental care, and other social services. Care Solace is available 24-7. Simply call 888-515-7881 or visit caresolace.com slash tx-beaumont to get connected. How about a $20 best friend? If you're looking for a new sidekick, Beaumont Animal Care is celebrating Clear the Shelters with $20 adoptions through August 29th. Even better, the first 15 adoptions on August 28th and 29th are free. Stop by 1884 Pine Street and meet the dogs and cats ready to be part of your family. Skip school for a movie night. Okay, maybe don't actually skip school, but you can catch Ferris Bueller's Day Off at the Jefferson Theater on August 21st. Then on August 28th, things get a little rebellious with Crybaby. For both classic movie nights, doors open at 6 p.m. and the movies start at 7, so grab your tickets and popcorn and enjoy a classic movie on the big screen. And finally, the Smurfs aren't letting a little rain keep them away from Beaumont. After Mother Nature rained out our August 6th showing, Movies in the Park is back for one last night. So join us August 22nd at dusk at Wuthering Heights Park for our rescheduled showing of the Smurfs. And that's all for this week's announcements.

Thank you very much. And I can't imagine that anybody just came for the presentations, but if you did, you're free to leave. At this point, we're going to move in to public comments. And now is the time for any citizen who wishes to speak. You may make public comments on the consent agenda or the regular agenda items one through eight or any other topics. Citizens wishing to speak on item nine will be given the opportunity to speak during the public hearing before that. The city clerk will call your name when it's your time to speak. If your address hadn't been called out when you approached the podium, if you'd please say your address, city, and state, you have three minutes for public comment. The green light will come on when you approach the podium, and the red light will come on when your time is up. please note while you're at the podium we're not going to be able to respond to your questions at that time from the dais somebody from city staff may reach out to you before you leave or we'll follow up with you and with that uh william sinclair 3400 veterans circle obama texas

I'm a Navy veteran here in Beaumont, Texas. I come here to speak out on one subject that's very important to me. Being a disabled veteran, I feel like there's more need for stuff like sidewalks, bike trails, or bike right-of-ways on some of the streets. We've got a number of people that are coming out with e-bikes and scooters and whatnot, and I'm forever seeing on the news where people are having issues being run over by motors coming around not paying attention with the motors and whatnot and i think there's you know more need for walkways and whatnot get people off the street uh to avoid that there's been a lot of you know major accidents and some fatalities in some cases and uh i speak for myself and a number of other disabled veterans that walk with wheelchairs walkers and canes and such and we don't have any business being out in the street WALKING THE STREETS NEED TO BE OFF THE STREETS ON THE CURB I HAVEN'T NOTICED RIGHT AWAYS IN MOST AREAS THAT CITY COULD YOU KNOW APPROPRIATE THE NECESSARY GROUNDS TO PUT SIDEWALKS IN PLACE AND MAKE IT HAPPEN AND THAT'S BASICALLY ALL I GOT TO SAY THANK YOU SIR THANK YOU UM ALBERT HARRISON 1240 ASHLEY BOMBARD TEXAS

Excuse me, but I will not give you my usual greetings. Concerned citizens, now I dare ask, why are the gas pipes and water pipes not covered like they're supposed to be? Why are my crosswalks across ditches and not there on Evelyn, Forest, Evelyn, Center, Evelyn, Ewing, Oakland, Ashley? Why are they not there? This is a violation of safety for that concern. Not just for the community, but for every citizen in this entire city, because if they're exposed there, they must be exposed somewhere else as well. Now only I say that to say I have looked and seen that they are exposed in other places besides my neighborhood. Thank you. Thank you, sir.

Jerome Alexander, 1119 Avalon Street, Beaumont, Texas.

Good afternoon. How y'all doing? I come in today to talk to Ms. Miley. Ms. Miley, you brought the engineer in to dig the ditches up. So he dug the ditches up, and like you say, they exposed the pipes. So I had a chance to talk to the center part energy guy. He said that it can be fixed, but what it would cost, the city would have to pay them to come in and put the pipes lower and the water could flow over them. But he did say it can be fixed. So we appreciate if you check into it and see, can you get the pipes female because you're playing the life and danger game with them pipes exposed like that. Thank you. Thank you.

Larry Gauthier, 5926 Greenmoor, Vermont, Texas.

Good evening, Mr. Mayor, city council and employees, employees. i'm gonna go back to 1992. texas railroad commission in the city of beaumont approved seismograph testing testing for all in beaumont texas the fire department police department water department they all expenses just ran clean out the roof with damages being done to seismograph testing uh For example, I showed Becky Ames a crack by the elevator. Damages to the property. My house, which was four-inch pads, four inches pads, 12-inch block, total of 16 inches, sunk all the way down to the ground. Caused seismograph testing. $80,000 home, gone. Also, damages to 60 other residents homes in Terra Park. I didn't get a chance to talk to the immediate area people because I was so busy with my own area. But I do know that after speaking to certain person that lived there now today he experienced that damage other people are experiencing damages we got a sinkhole that's taken place we got a busted line on Franklin Street if you draw a straight line from the port when they did their expansion, that bam, bam, bam, bam, bam, it damaged those lines. So the people in Amelia, people in Terra Park, the people in the south end of Beaumont, we all experienced that bam, bam, bam. Even the overpass was put in Carroll Street, bam, bam, bam. You shaking the ground, you shaking the earth, you shaking city hall. I get scared every time I come up here because it might open up. It's right there in front of you. It's right there. That's basically, just look around you. You see the earth is moving, shaking, being disturbed. And what is the cause? The root cause analysis. I believe in finding the root cause to everything. And my root cause is I THINK IT WAS THE TWO STREETS OUT WEST END. IF YOU WERE TO DRAW A STRAIGHT LINE FROM THE WATER PROBLEM ON FRANKLIN AND DRAW A STRAIGHT LINE ACROSS THE CITY OF BOMA, YOU WOULD HIT.

NEW SPEAKER THANK YOU, SIR.

NEW SPEAKER THANK YOU.

NEW SPEAKER SHAUN PROCTOR, 4680 JAN CAR DRIVE, BOMA, TEXAS.

GOOD AFTERNOON, MAYOR, COUNCIL. PROTOCOL HAS ALREADY BEEN SET. I JUST CAME TO KIND OF SPEAK ON THIS ISSUE THAT WE GOT WITH THE TAXES, YOU KNOW WHAT I'M SAYING, AND A BIG THING AS FAR AS JUST HOW EVERYBODY'S IN UPROAR IN REGARDS TO THIS. WE UNDERSTAND BUSINESS. WE UNDERSTAND BUDGETS. FOR THOSE OF YOU THAT RUN BUSINESSES AND THINGS LIKE THAT, THEN YOU UNDERSTAND THAT OF COURSE YOU'RE GOING TO HAVE A BUDGET. A lot of things, just me personally, when you look at this and budget, council, of course, you have other people that kind of put the budget together, Mr. Boone and staff or whoever does that. It's brought to you guys and you guys look over it to just make sure that it's going to fall in or fit in wherever you think. But when you study that, of course, it's all about recommendations. Recommendations that you do this, recommendations that you do that. When we start pointing the finger, of course, you guys, this is your first time sitting in a budget. prior year you came in and the budget was just being done and you came in. So when you sit now and you look at that, you guys have had that time to do that. But prior to that, my thing is to you and the citizens just kind of being transparent, as we often like to use that word, but sometimes I think it's not really used in the context of what we really need to have it used in. but when we look at that you guys come in this year as far as that transparency and being in a budget but prior to that things have already been in place so when the numbers were off and we're saying that we're in a struggle we're in a deficit and all those things and the numbers were not where did they start didn't just start now this was prior this was previous so you guys have just been almost two years so if you have a problem the problem didn't just start it started prior to that so if we're going to say that where it started at then we'd have to look at internally, who was there? Did they know? Did they not know? If you can't come in and say it's somebody's problem, you can't come in and put it on the mayor's back. You see what I'm saying? Because even prior to that, it didn't just start today. And if you're going to run a business, you business people, if you're going to run a business, you don't start hiring people whenever you've got a problem. You find where you're going to cut. You don't go and hire new people. You cut. And if you don't want to cut your people that you already got, then you keep them. You protect them because they've been there. That's where your loyalty lies in a sense. You don't hire somebody else and create another income or something else that you have. So you start looking at those things where you do. And then we look at this too. I know we need EMS, fire, police, and all of those things. But do you give a raise and you got a problem in your budget? Do you increase money that you're going to pay out when you already got a problem that you have? So some things we got to look at. And then lastly, I don't care where people live. I think people should be able to live where they live. But do you tax me and make me pay taxes for somebody that don't live here, that don't pay taxes, but you don't give them more money? Those are just things that I say when you ask questions. If you don't live here, and I take your money, and I don't get no taxes. I don't have to pay when you raise everybody taxes. My mom is a senior citizen. My mom can afford to pay the taxes. We ain't going to say that she can't. But what about the people that can afford it? What about the people that live here that just don't have those funds? And we already have the tax assessor increase that last year. We're going to add the city on top of that and all that other things. And we don't want nobody to live because the people that can afford to move, if they don't like it, they'll move to Hardin County. They'll move somewhere else. But what about the people that's left here that can't afford it, that can't afford those taxes? Just think about them. We know the city has to run, but where do you cut? Thank you, sir.

Christy Arnsberger, 3050 Liberty, Beaumont, Texas.

Good afternoon, Mr. Mayor, council members, and other city officials. My name is Christy Earnsberger. I'm a social worker with 30 years experience working with dialysis patients. I'm here today to advocate for my patients by highlighting some of the barriers they face with transportation to dialysis when using Beaumont Zip Paratransit. Beaumont Zip Paratransit is the only public transportation for the city of Beaumont. Nutrition and services for seniors no longer operates within the city limits of Beaumont. To get established with paratransit, there's a 14-page application with a 21-day processing time. I fax those applications in for my patients, but it doesn't seem to speed the process any. Most people needing transportation do not have the luxury of waiting 21 days before they can make an appointment for transportation. With paratransit, there's also an ineffective call procedure for scheduling. People are required to call daily starting at 8 o'clock in the morning to schedule a ride. They end up waiting in a queue for a very long time, sometimes over an hour, to schedule a ride. Rides are scheduled on a first-come, first-served basis. There's no priority for medical appointments over someone going to the grocery store. There is a wait list to establish a set schedule for patients with recurring appointments, for example, going to dialysis, chemotherapy, physical therapy, and those people are forced to call in, wait in the queue every other day for these recurring appointments. Based on the current call system, people run the risk of not getting the ride they need to that medical appointment because someone may call in ahead of them and get that time slot simply to go to the grocery store. My proposed solutions for Bowman Zip Paratransit is to reduce the application process time to allowing people to access transportation services sooner. Better management of the phone system for scheduling rides and reducing call wait times. prioritize medical appointments above other transportation requests. This would allow people with recurring appointments to be on a set schedule or at least reduce their call frequency to once a week or maybe once a month for recurring appointments. This would eliminate the need for these people to have to call every other day. This would also reduce the call volume and wait times for people trying to get an appointment with Bowman Zip. I'm asking the mayor and the city council members to launch an investigation into the issues relating to accessing transportation through Beaumont Zip Paratransit. This is a city service that's not working for my dialysis patients or other citizens within the city. Many citizens use this paratransit system to get to lifesaving treatments and deserve better service from Beaumont Paratransit and the city of Beaumont. Thank you for your time.

Thank you.

Judith Rich, 995 Monterey Drive, Burma, Texas.

Good afternoon, everyone. My name is Judith Rich. I'm here because of the vote that was done to demolish my structure at 2394 Angelina. I'm here to ask, would you consider not DEMOLISHING MY BUILDING GIVE ME A CHANCE TO BRING IT UP TO CODE AND REMODEL MY BUILDING BECAUSE DEMOLISHING THAT WOULD PUT ME IN A SITUATION WHERE I CAN'T EVEN RETIRE. THAT IS MY LIVELIHOOD. MY RENTAL PROPERTY. AND THE REASON I COULDN'T ATTEND THE MEETINGS IS BECAUSE I'M SUFFERING FROM PANCREATIC CANCER. And there's days that I don't even know who I am. So I ask that you would consider me. I have people in place that's willing to go to work and bring the property up to court. Thank you.

Thank you.

Rodney Dinclaw, 4105 Chase 1 Avenue, Beaumont, Texas.

Hello, Council. The reason I'm up here is because I was told to come up here and talk because I don't know who else to talk to. But like a while back, the city built me like a ramp going down from my sidewalk to in order to cross the street to get to the bus stop across the street. And a couple years ago, They came and did some pipe work there. And when they did that, I guess they laid the concrete back. And when they did, I guess the ground sunk. And can y'all see that? That's what happened when the ground sunk and I called 311 to, you know, ask them if they could come fix it. And no one ever showed up. The reason I'm coming is because, you know, my neighbor, the bus usually parks in front of her driveway to pick us up. And my neighbor's been, you know, getting, you know, kind of complaining about it. So I was seeing if y'all could fix it for me or tell me what to do or give me the right direction to go to get it fixed. That way the paratransit could pick me and my wife up right there where the bike lane is or maybe see about how to go about. We get in the sidewalk going towards the street like that way, you know, in front of my house so the paratransit can pick us up. I appreciate y'all listening and I thank you.

Thank you, sir.

And that's all I have, Mayor.

All right. Thank you. With that, public comments is closed if no one else would like to speak. Now we're going to move on to the consent agenda. Is there a motion and a second for approval of the consent agenda? That's Councilman Williams and seconded by Councilman Hilliard. Is there any discussion on the consent agenda items? All those in favor of approval of the consent agenda, please signify by saying aye.

Aye.

Any opposed? The motion is carried. All right, Mr. City Manager, we are going to begin with item two, correct?

That's correct, Mayor.

If you would please have the reading of item number two.

YES, MAYOR AND COUNSEL. ITEM NO. 2 IS TO CONSIDER A RESOLUTION RECEIVING THE PROPOSED FY2027 BUDGET AND SCHEDULING A PUBLIC HEARING. AND AS PART OF THE PRESENTATION OF THIS ITEM, WE DO HAVE A PRESENTATION FOR YOU. BEAR WITH US JUST A MINUTE. MAYOR AND COUNCIL, TODAY WE PRESENT TO YOU THE PROPOSED 2027 CITY BUDGET. SO WE'LL START OFF WITH PERHAPS HOW SOME PEOPLE THINK THAT BUDGETS ARE FORMED AND YOU START PLANNING AND YOU WORK THROUGH IT AND YOU GET THE BUDGET ADOPTED. THE REALITY IS CITY BUDGETING CAN BE TRICKY AND SO IT'S A IT'S A PROCESS WHERE WE COLLECT INFORMATION FROM THE DEPARTMENT DIRECTORS WE LOOK AT OUR REVENUES WE HAVE HAD I THINK AN UNPRECEDENT NUMBER OF WORKSHOPS THIS YEAR I THINK WE'VE HAD FOUR JUST BECAUSE OF THE CHALLENGES THAT WE FACED AS WE PUT TOGETHER THE PROPOSED BUDGET SO WHERE WE'RE AT NOW IS IN THE PROCESS IS essentially presenting the budget to council it's going to be both the budget as a total as well as the cip and then later on after item two we will present item one which is to set the proposed tax rate it's not to adopt the tax rate but to accept the proposed tax rate so a little more detail september 8th THAT'S WHERE WE'LL HAVE A PUBLIC HEARING ON THE BUDGET, A PUBLIC HEARING ON THE TAX RATE, AN ORDINANCE ADOPTING THE BUDGET AND ACCEPTING THE APPRAISED TAX ROLE, AND A RESOLUTION ADOPTING THE CIP, WHICH IS THE the capital improvement program and then finally september twenty second that's when you'll actually adopt the tax rate and ratifying the property tax increase with the beginning of the new fiscal year october first we'll start with and we've talked about this in our in our budget workshops over the past several months but kind of where WHERE HAVE WE WHAT'S GOT US TO THIS POSITION AND SO WHAT THIS SLIDE SHOWS IS THE GENERAL FUND AND WE'RE OF COURSE LOOKING AT SEVERAL FUNDS BUT THE GENERAL FUND IS THE ONE THAT IS MOST OF INTEREST I BELIEVE TODAY AND AS YOU'RE AWARE THAT RED LINE GOING ACROSS THE SCREEN THAT REPRESENTS THE 27 PERCENT FUND BALANCE AMOUNT FOR THE GENERAL FUND and again that's kind of your rainy day find a set by city policy I will point out that that can be adjusted up or down but right now that's the current policy so that's approximately depend based on that proposed spending that's approximately thirty six million dollars looking back to f y twenty four that fund balance was forty four million and you can see in the ensuing years and now looking towards f y twenty seven we've gone from forty four million to thirty five million so again looking at prior budgets f y twenty four twenty five and twenty six this is how much we dipped into that fund balance if you'll notice is the far right that's the proposed f y twenty seven and you can see Despite the increased expenses that were faced that we'll talk about in a minute, you know, we are proposing an FY27 general fund fund balance deficit of quite a significant reduction. Why? And again, we've talked about these in prior budget workshops, but we've got inflationary pressures. Again, that's I think most most people are facing those. for a variety of reasons, but certainly the city of Beaumont is not immune to those inflationary pressures. We've talked about required transfers to employee benefit funds. We've talked about contractual wage requirements. We know that our infrastructure is a challenge, and so part of the equation is trying to fund investments to repair and maintain our infrastructure streets roads water drainage etc so that's also a challenge you know in years past we used to well we would buy vehicles with spare with additional cash THIS LAST YEAR WE'VE ISSUED A TAX NOTE AND WE PLAN TO DO THE SAME IN THIS NEXT FISCAL YEAR TO PAY FOR VEHICLES. I THINK WE HAVE OVER 1,000 PIECES OF EQUIPMENT, ROLLING STOCK AND OTHERWISE THAT WE HAVE TO USE IN THE COURSE OF OUR BUSINESS. AND SO IT'S ALWAYS A CHALLENGE TO MAKE SURE WE HAVE THAT EQUIPMENT, ROLLING STOCK NECESSARY TO DO THE JOB THAT WE DO. then technology you'll see that that's a significant investment to make sure that we have the tools that we need to deliver services to the citizens and we talked about in the prior workshop again the gap between revenue and expenses and the growing gap and so this goes back to the prior budget workshop You know, we did project out that the ending fund balance was going to be much lower than we were proposing today. but since the initial workshops and we started working on this budget in the spring and early summer we've taken some pretty significant steps to try to get us back in line with where we need to be that includes a salary freeze of 4.2 million in savings a decrease in operating supplies and equipment of 300 000 and again this is going to the department heads and saying look where can we find some savings Travel and training. Again, we've talked about that in prior workshops where some travel and training is required to maintain certifications, both for professional organizations, state and federal governments. So there is some essential travel that we still need to do, but we've been able to cut that in half. And then also we're gonna ask the employees to contribute a bit more in terms of their health benefits and that should help as well. And then also we've cut our executive level staff to also offer some savings. So again, taking those early steps in the budget process, we've managed to lift up what was a projected further decline in the fund balance to a much better scenario. As we look forward to FY27 and 28, we should point out that we still have the same pressures, inflation. We have essential needs. We have contractual obligations for police and fire. The employee benefit funds still faces significant challenges. We have a COVID fund that we're trying to recoup some of our expenses during the pandemic. We're still, excuse me, still working to try to get that resolved. We have unfunded mandates that are basically, some are from the federal level, some are from the state government. I MENTIONED THE HIRING FREEZE IS A SIGNIFICANT CUT TO OUR EXPENSES. HOWEVER, THE LONGER WE KEEP THAT HIRING FREEZE IN PLACE, THE MORE DIFFICULT IT BECOMES TO PROVIDE THE SERVICES WE NEED TO PROVIDE AT THE LEVEL WE WANT TO PROVIDE THEM. I MENTIONED INFRASTRUCTURE AND THE NEW DEBT SERVICE. WE'VE GOT PUBLIC SAFETY CHALLENGES WE'RE AWARE OF THAT COST MONEY. And then, of course, I'll mention the infrastructure again. This is just a quick history and projection of our contractual obligations for fire, police. You'll see on the far right, we've got FY27 proposed at 2%. And I mentioned that in relation to the hiring freeze because as we have more employees, or excuse me, we have fewer employees doing more, that's important. So what's the strategy looking forward? again we want to tighten our belts because as i mentioned the our revenues are increasing and we'll see that here in a minute but our expenses are increasing at a higher rate and so the idea is that we essentially implement an austerity campaign beginning this fiscal year going into next fiscal year our hope is that this time next year will be in a better position as we look for efficiencies and cost savings where we will be in a better position looking towards f y twenty eight I mentioned the hiring freeze I mentioned the cut cutting executive level staff I mentioned limited travel and training limited supplementals and these are additional requests by departments to try to do a better job a more efficient job for the city includes new programming sometimes but we limited those to essential only and then again as I mentioned we really charge the department directors and division managers with taking a hard look at THEIR OPERATIONS TO SEEING WHERE WE CAN FIND EFFICIENCIES. AND THEN FINALLY WE ARE GOING TO LOOK AT STARTING OUR WATER FUND TO UNDERTAKE AN EFFICIENCY STUDY. AND THAT WILL LOOK AT A VARIETY OF PROTOCOLS AND PROCEDURES WITHIN THE WATER DEPARTMENT THAT WILL EXTEND OUT BEYOND JUST THE WATER DEPARTMENT. BECAUSE THAT DEPARTMENT IS CONNECTED TO SEVERAL OTHER AREAS OF OPERATION WITHIN THE CITY. SO THAT'S GOING TO BE SOMETHING WE UNDERTAKE THIS YEAR AS WELL. I MENTIONED HIRING FREEZE JUST A QUICK HISTORY ON PERSONNEL ADDITIONAL PERSONNEL IT'S BEEN ADDED OVER THE LAST FEW YEARS TWENTY FOUR WE HAD THIRTEEN FY TWENTY FIVE FIFTEEN TWENTY SIX ELEVEN THIS YEAR WE PROPOSED TO ADD ZERO I MENTIONED THAT WE'RE FOCUSING ON ESSENTIAL SUPPLEMENTALS ONLY THIS LIST WAS CONSIDERABLY LONGER AT THE BEGINNING OF THE SUMMER BUT AS YOU LOOK DOWN THE LIST the big ticket items are related to software and I know we've talked about the ERP that goes into having a better better tool to serve the customers in a variety of ways and that ERP is our financial system and other systems that will extend across multiple departments it's a multi year process but again it's a big ticket item but it is essential the city work software that's a pretty big ticket item right under is you'll see the initials eol that just means it's end of life and so when those software packages hit the eol status it's a problem because they can no longer be supported by the vendors Mentioning fleet requests, if you look, the request initially from the departments and our fleet group was 13.6 million. We've been able to pair that down to 6.4 million. As we look at capital reserve equipment, fire, IT, police, and information, WE'VE BEEN ABLE TO PAIR THAT BACK DOWN TO 5.5 MILLION. AND AGAIN, THIS IS THE EQUIPMENT THAT'S ESSENTIAL FOR THESE GROUPS TO DO THEIR WORK. I MENTIONED THE COLA INCREASE PROPOSED FOR CIVILIANS EARLIER ALONG WITH POLICE AND FIRE. WE TALKED ABOUT THIS AT THE LAST BUDGET SESSION WORKSHOP. TO PUT IT IN KIND OF real terms we did pull and looked at our our median salary of our city of beaumont civilian employee and it falls at about forty six thousand dollars ninety two forty six thousand ninety two dollars annually and so a two percent cola would give that employee about seventy six eighty two i also mentioned that we're having to ask our employees to contribute more to their health plan Which is about forty bucks a month and so now the sudden that has decreased thirty six eighty two per month for the median employee. And again it's important to note that because just like inflation is affecting everyone especially the city it affects our employees at home. So now pivot to revenues as we look towards the f y twenty seven budget. YOU KNOW, AGAIN, AS MENTIONED, OUR REVENUES CONTINUE TO INCREASE. UNFORTUNATELY, OUR EXPENSES OUTPACE THAT. AT FIRST GLANCE, THIS LOOKS LIKE GOOD NEWS, AND IT IS BECAUSE THEY'RE NOT DECREASING. IF YOU LOOK TOWARDS THE RIGHT OF THE LINE, YOU'LL SEE HOW IT IS SOMEWHAT FLATTENING. ANOTHER WAY TO LOOK AT THIS IS IF YOU LOOK AT THE INCREASE OF PERCENTAGE YEAR OVER YEAR, YOU CAN SEE THAT THAT INCREASE OF PERCENTAGE YEAR OVER YEAR IS NOW DECREASING SO AGAIN WE'RE GETTING MORE MONEY FROM SALES TAX BUT THE GROWTH RATE IS NOT WHERE WE NEED IT TO BE THAT SAID WE'RE ALSO LOOKING AT OUR PROPOSED FEES STRUCTURE AS PART OF THE BUDGET AGAIN WE WE'VE TASKED DEPARTMENT DIRECTORS TO LOOK AND SEE HOW OUR SERVICES THAT WE PROVIDE THAT REQUIRE FEES COMPARED TO OTHER JURISDICTIONS AND ASK THEM TO OFFER UP A RECOMMENDED FAIR FEE. AND SO THAT'S LISTED HERE. SO NOW WE'LL PIVOT AND TALK A LITTLE BIT ABOUT PROPERTY TAXES THIS IS THE ASSESSED VALUES THAT WE'VE BEEN PROVIDED Going back to 2016 to 2027. Again, looking at what that looks like over those years, you can see the good news is it's going up. But again, as you look towards the right part of the slide, you can see there's a certain amount of flattening. Similar to the sales tax, you can see the year over year growth percentage is decreasing. So looking historically at what property tax rates the city has required as part of their budget you can see going back to twenty eighteen seventy one cents held steady there for several years in his dropped or stayed stable in the following years. and i will say for the benefit of the public i think most know this but just to be clear the the city does not set the tax values that's done by a different separate entity the appraisal district they give us the tax values the city council is charged with setting that rate and so the combination of the values times the rate is is what gives us that property tax revenue yes sir

CHRIS, SINCE YOU JUST MENTIONED IT, THAT WAS ONE OF MY QUESTIONS I WAS SAVING FOR THE END, BUT I HAVE A LOT OF CONVERSATIONS WITH PEOPLE ABOUT WE'RE RAISING THEIR TAXES AND I TELL THEM WE HAVE NO CONTROL OVER THE APPRAISAL DISTRICT. CAN YOU OR SOMEBODY FROM THE STAFF PLEASE EXPLAIN WHO HAS AUTHORITY OVER THE APPRAISAL DISTRICT AND HOW IS IT FORMULATED AND HOW DO THEY MAKE THESE DECISIONS?

YEAH, IT'S A SEPARATE APPOINTED BOARD THAT ELECTED BOARD, IT IS A SEPARATE BOARD THAT CONTROLS THAT. They have accounting principles and appraisal principles that they go by to establish what those values are but we the city do not participate in that process of setting what those values are so I know that's always a point of confusion of. You know, this especially when you get your tax bill and your appraised value or your tax value has gone up significantly and you get upset. You know, we get it. We get it. But that value, whether it goes up or down, that's not up to the city. We don't we don't decide that. But it is fair to say that the city sets the tax rate, which combine the rate with the value that establishes how much is owed. TO THE CITY, JUST LIKE EVERY OTHER JURISDICTION, LIKE THE BISD SETS THEIR OWN TAX RATE, AND THAT ACCORDINGLY GIVES THEM THEIR REVENUE, SOME OF THEIR REVENUE, BASED ON WHATEVER THAT VALUE IS.

AND SINCE WE'RE HERE, I THINK THAT IT'S IMPORTANT TO NOTE, I WAS WATCHING THE NEWS YESTERDAY, THIS TAX RATE WENT OUT TO VOTERS And they approved a certain amount, right?

So we can talk about that in just a second, about the rates. But you're correct in that in November of 2025, there was a bond election. And the voters were able to choose what, if any, bond propositions they wanted to approve. And related to that, yes, it is tied to a tax increase. IT IS TIED TO ADDITIONAL DEBT. AND SO AS A RESULT, PROP A PASSED, AND SO NOW WE AT THE CITY HAVE TO CONTEND WITH THAT BECAUSE WE DO NEED TO PAY FOR THAT EXPENSE THAT THE VOTERS DID APPROVE. AND SO IN A SECOND WE'LL SHOW WHAT THAT RATE WAS.

NEW SPEAKER THE VOTERS APPROVED. NEW SPEAKER YES, MA'AM. NEW SPEAKER THANK YOU.

okay so and this is I guess we're here so these are the different rates basically kind of a menu of rates to look at we'll start with the current adopted rate that as is labeled is the current adopted rate in the current f y twenty six budget then there's the no new revenue rate and that's a calculation as the name implies no new revenue should be gained if we apply that rate to the new values that's not on individual property basis that is on the city as a whole basis then as You mentioned the geo debt rate. So that's a rate we calculated coming out of one of the recent workshops where we wanted to show, okay, what's the current adopted rate plus the additional tax rate required to cover the geo debt. And that geo debt, that's the bond election from November. and then we also calculated the debt rate or the current rate rather plus debt so that's the geo debt that the voters approved in november twenty twenty five the ceo debt that we've approved to do needed infrastructure plus the tax note that's related to the vehicle purchase so essentially All the the the rate we need for the debt service to be covered plus the current rate is what that with that line shows. Then we've got the 2023 adopted rate of 0.695. And again, as the name implies, this is the rate that was in effect back in 2023. And then. twenty eighteen to twenty one is as the name implies that's the rate that was steady for several years back in those years and then finally the voter approval rate so if we hit that rate then we we can't exceed that rate hit that rate exceeded without going back to the voters for voter approval which is obviously a pretty high rate so As another way to look at the different rates this is essentially the revenue that would be generated above the current adopted rate. So as you look across the screen on the very far right that's the voter approval rate that I mentioned earlier that is obviously fairly high. And then looking across you can see. the additional revenue gain from different scenarios this is a little bit busy but I'll start with the green in the blue the the blue being revenues the green being expenses the red is that twenty percent third fund balance line in the general funds fund balance and that's at about thirty six million And then the orange line is that ending fund balance line. So for the current adopted rate, that's part of the FY26 budget, this is where it puts us based on everything we know. And so you can see that that would put our ending fund balance in 27, well below that $36 million. And I will say that you know again that twenty percent is not a loss it's just our policy the. And so but that's that's the target we're aiming for here. Now the next slide is another scenario that's the no new revenue rate. And again as you can see. It puts our ending fund balance still below. Provides a little more revenue, but puts us still below that 20% line. Current debt rate plus geo. Current debt rate plus all debt. That's point 692802, so much closer to that 20% line. Then looking back at the 2023 adopted rate, puts us almost on line with the twenty percent the seventy one that's the one going back a few years back that would put put us well above the twenty percent rate and then the final is the voter approval rate which puts us well well above the thirty six million

Yes, Councilman Duryea. Are you going to show a slide that actually shows how much the homeowners' taxes are going to go up in cash, like for different value houses, how much in money per year that's going to go up?

I think we do have a slide. If not, we can get you those numbers because we calculated it based on a $150,000 slide. But I think we do have that slide.

Councilman Crenshaw. On page twenty nine of your twenty twenty seven proposed operating budget it has a statement of revenues and expenditures and for fiscal year twenty twenty seven it indicates a hundred and eighty million five hundred two thousand for expenses and then it says the revenue loss basically the deficit THAT YOU'RE PROJECTING FOR 2027 IS ONLY $605,000. WHAT RATE IS THAT BASED ON? WHAT TAX RATE? NEW SPEAKER WE'RE GETTING THERE. NEW SPEAKER YOU CAN'T JUST TELL ME.

NEW SPEAKER 695.

NEW SPEAKER 695. OKAY. And that is impressive. I'm not saying that rate's going to work, but that's impressive that you would have reduced what we're deficit spending and have been for the last four years down to $605,000. What is, and I'm not, and I know no one's probably going to know this off the top of your head, but what have we spent deficit-wise the last four years? I know right now we're projecting $5 million. FOR 2026, WHAT DO WE DO IN 25 AND 24? IT'S OKAY. IT'S OKAY. BUT LAST YEAR WAS ONLY 2.5? 2.5 AND 2024 WAS 3.6. 3.6. THANK YOU.

so again this is seventy six which is voter approval rate which is the highest being proposed again additional revenue offered up by the different rates anything above the current adopted rate of six five nine and again just kind of gives you this just another way to look at the different options giving us a different look across the as we try to maintain that Horizontal line at the top which is twenty percent So again as I mentioned earlier the proposed rate and this budget, but is based on a sixty nine five point six nine five and You know we'll go over the reasons for that Number number one is as we talked about we've had multiple years of dipping into the general funds fund balance and again This is this is essentially the city's rainy day funds We've got structural issues of expenses continuing to exceed revenues. This is a problem, an issue that we feel like we can make a dent in it this fiscal year and a bigger dent in it next fiscal year, but it's something we cannot solve in a single year. As I mentioned, we've got new debt obligations. a lot of that has to do with infrastructure improvements investments that we need. Again the desires to maintain that twenty percent fund balance. And as mentioned the proposed rate is point six nine five and that is the same rate that was in effect in twenty twenty three. As mentioned we've already cut more than five million dollars from the budget WHICH AS MENTIONED IS NOT SUSTAINABLE FOREVER IF WE WANT TO MAINTAIN THE LEVEL OF SERVICES THAT WE WANT TO MAINTAIN AND HAVE BEEN MAINTAINING. AND I WILL SAY THAT IT WAS ONCE SAID THAT A CITY MANAGER'S LONGEVITY IS NOT GOOD FOR A CITY MANAGER'S LONGEVITY TO RECOMMEND RAISING TAXES. BUT JUST TO BE QUITE FAIR, MY JOB IS NOT TO MAINTAIN MY LONGEVITY. MY JOB IS TO GIVE YOU MY BEST RECOMMENDATION ON WHAT I THINK YOU NEED TO HEAR. AND AGAIN, THESE ARE RECOMMENDATIONS BASED ON THE FACTS THAT WE HAVE. AND AS SUCH, JUST RECOMMENDATIONS IN TERMS OF THIS BUDGET. BUT THIS IS THE BUDGET WE ARE RECOMMENDING THAT YOU ADOPT. I go back to this slide is just showing the additional revenue based on the different tax rates scenarios. This next point I think is important. Because as I mentioned in a in a few minutes will will ask you to return to budget item one which is to set the proposed tax rates not the final tax rate that'll be in september but it's the proposed tax rate that this budget is based off of. That's the number here. Again, we've seen this slide. But it's important that y'all understand that not today, but in September, if you want to go anything above or to the no new revenue rate or above, it will require five affirmative votes to go above that rate on September 22nd. So again, we're asking y'all to prove the preliminary rate today of point six nine five which is what the budget is based off of but in order to and you can do that today because remember you can always go down between now and September you just can't go up but just be aware that when it comes to the final vote for the setting the tax rate if you want to go above that point six eight three nine which is the no new revenue it will require five affirmative votes to do so

WHERE IS THAT COMING FROM?

STATE LAW.

COUNCILMAN WILLIAMS?

ON ONE OF THE PREVIOUS SLIDES THAT YOU CUT THE 5 MILLION OUT OF THIS YEAR'S BUDGET AND YOU SAID THAT THAT'S NOT SUSTAINABLE.

WHY? WELL, BECAUSE A LOT OF IT HAS TO DO WITH FREEZING POSITIONS, GENERAL FUND POSITIONS. I'M NOT SAYING WE CAN'T SORRY TO CUT YOU BUT ARE THERE POSITIONS THAT HAVE SET SOME OF THEM SET VACANT FOR AN EXTENDED PERIOD OF TIME PRIOR TO YOU I WOULD SAY THE AVERAGE IS SET VACANT FOR IT JUST DEPENDS ON THE POSITION SOME HAVE EXTENDED I WILL SAY THAT SOME HAVE EXTENDED OUT MAYBE A YEAR WHICH THOSE ARE THE EASY TO SAY HEY IF YOU HAVEN'T HAD THIS POSITION FULL IN A YEAR Maybe you don't you know, take a hard look at that. Most of them, you know, maybe a month or two or three. And then some of them, as you know, police, fire, EMS, 911, CDL drivers, they're just hard to keep and fill. And so that plays into it as well. Yes. Yes, ma'am.

I noticed that it said salary freeze. Who is that applied to? Who is that going across the board or where? When I saw that I had a question mark. What's up?

Sure. So the salary freeze only applies to non-public safety positions. So that's civilian positions. And so there are about 91 positions on the...

Excuse me, city manager. We're going to take a 10 minute recess.

Okay.

And so we will be at We'll be back at 2.38, 10 minutes. Do we need to roll call at this point?

It's up to you. No one really left the room, and we're all here.

Okay. We'll proceed. I believe, Mr. State Manager, you were presenting.

So I'll go back one slide. Okay. So we were talking about, again, just wanted to point out that today we'll set the preliminary tax rate, which can always go down between now and September 22nd when the final is adopted, but it can't go up. But as mentioned, if anything above the no new tax rate, does require the supermajority vote. And then what does that mean as a practical matter? Again, the difference between the proposed 695 and let's say we did set it at the no new revenue rate, we would need to Go back and try to find $1.2 million. Same thing with the geo debt rate. Try to find $2,096,765. And again, it always goes back to this is a similar number. It's just a different way to look at it. It's basically a departure from the proposed tax rate of 2023. If you went higher, what would that get you? If it went lower, what kind of cuts would we need to make? And again. Seeing that slide and those are the 2. So okay.

Councilman Williams whenever you go through this process and and you know you look at a tax increase do you kind of dive into what impact that could have on sales tax revenue I mean if it's more money coming out of somebody's pocket that is less money for them to spend so it has to be connected.

yeah short answer i don't think there's a formula or estimate it is a good point because obviously the more you're spending on property taxes the less discretionary so it is a good point but to answer your question i we're not we're not factoring that in okay yes sir thank you yes councilwoman

I SAW A LOT OF EFFICIENCY THINGS AND CUTS, BUT ARE WE LOOKING AT FINDING MONEY? IS THERE A WAY TO GO AND FIND THIS $2 MILLION OR A WAY TO INCREASE, BRING SOME MORE MONEY IN? WHAT ARE WE DOING TO FIGURE OUT HOW TO GET SOME MORE MONEY IN HERE?

Right. So we are proposing to raise fees because those are more direct that we have control over. We are, you know, as we've talked about recently, you know, we do have an economic development effort. We are going to be looking at, you know, our industrial agreements in the future. to see if maybe we can get some better terms. We, of course, are always pursuing business. I know that this council has authorized some economic development for like off of Northwest Parkway where we have some new homes going in, some new businesses going in. So those things like economic development take more time, whereas fees, we can find those revenues relatively in short order. And then again, one of the few things we have control over are the fees and then the property tax rate.

Councilman Crenshaw. If you could go back to the slides you had before where you give us the two options there that don't require a supermajority. It was, it might have been before this one where you, it had no, yeah, perfect. This one. Okay. So under the, if we elect the current rate plus the geo debt rate, it's about a $2.1 million additional deficit to the $600,000 deficit in the binder on page 29, correct? Correct. And does that include a 2% cost of living increase?

Yes.

Okay. And so you had earlier said that 2% cost of living increase was about $816,000? Yes, sir. Okay. Also, if we did not do require the additional contribution that employees have to pay, if we did not require employees to pay that additional, did we increase it 9% or it's increased to 9%?

INCREASED AT 9%. NEW SPEAKERS. NEW SPEAKERS.

INCREASED AT 9%. SO THEN THAT WOULD BE ABOUT A NET REDUCTION OF ABOUT A HALF A MILLION, CORRECT? BECAUSE WHILE IF WE DID NOT GIVE THE COLA, I ALSO THINK IT WOULD BE UNFAIR TO NOT ASK EMPLOYEES TO PAY MORE ON THE CONTRIBUTION. SO IT WOULD BE ABOUT 500,000 LESS OF THAT 2.1 MILLION, RIGHT? SO IT WOULD BE ABOUT 1.5?

NEW SPEAKERS. I THINK IT'S 300,000. HOLD ON ONE SECOND. NEW SPEAKERS.

AM I RIGHT, LAURA?

NEW SPEAKER FOR THE ADDITIONAL EMPLOYEE CONTRIBUTION SHOULD YIELD US ONE SECOND.

NEW SPEAKER I THOUGHT THE PREVIOUS SLIDE SAID $300,000.

NEW SPEAKER I THINK IT'S $300,000.

And so again, I'm just, I'm running numbers trying to figure out how to get that 2.1 million down to something maybe a bit more acceptable. Tell me where we're at on travel. I know you said that you were reducing travel costs 60%.

So we were just under, if you look at the entire travel budget, we were just under a million. By reducing 60%, that basically yields a saving of about $555,000.

Fair to say that probably can't be cut anymore.

And that is also training, too, so not all of it is travel. We have a lot of certified.

So the travel includes mandatory training for, like, law enforcement and firemen?

Yes.

Why would we include that in travel?

Travel and training.

Oh, it's travel and training. Okay, well, your slide earlier just said travel. I just think of a bunch of people flying around on airplanes.

Chris, if I may, the $308,000 that the 9% increase in the premiums amounts to, that actually goes to the employee benefits fund. So that doesn't have an impact on the general fund. Employee benefits fund is what gets impacted by that $308,000 if that increase isn't put in place.

It does help with a potential transfer.

It does help that way, yes. But I just wanted to be clear that the actual increase on the premiums go to the employee benefits fund.

So if I said that I didn't think it was a good idea and we had the votes not to increase the employee contribution that they have to make to that, that would not be a net savings on the current deficit projection for 2027?

That's correct. But the potential transfer would...

But the 2% does absolutely impact the general fund. Yes, sir.

Okay. And then my last question, if let's say the 2% was approved on the 2 million that we're going to be an additional deficit, have you identified what each department would have to, I've heard this happening before with organizations, each department's asked to look at its discretionary budget and cut a certain percentage in order to get us to the numbers that we need. If let's, and I'm not in any way trying to say I think that this is going to happen, but if the council adopted the current rate with the voter approved November bond election debt amount, what would each department have to cut out of their discretionary spending in order to make up for that $2.1 million gap?

i don't need an exact number but i'm just are we talking about 10 are we talking about five percent um so i wouldn't know what actually each department would have to cut because at this point expenditure-wise and as far as operations go which would be what you're speaking of we've cut everything that they can cut because if you look at our expenditures from 26 to 27 it's two million dollars that's contractual wage increase right there there's nothing else

WELL, WE WANT TO SAY THERE'S NOTHING ELSE TO CUT.

IT WOULD HAVE TO DIP INTO SERVICES OR SOMETHING ALONG THOSE LINES. AS FAR AS OPERATIONS, EVERYONE'S LOOKED AT THEIR OPERATIONAL BUDGET, FINELINED IT, EVERYBODY'S CUT IT. I'M NOT SAYING THERE CAN'T BE. I'M SURE THERE COULD BE. BUT IF YOU LOOK AT JUST EXPENDITURE INCREASE ALONE, THAT $2 MILLION IS YOUR FIRE, POLICE, AND COLA.

OKAY.

MAINLY FIRE AND POLICE.

AND THEN FINALLY, WHAT IS THE PERCENTAGE Staff is recommending that we increase property taxes, which is the city's portion. So I know the rate you're recommending is going from basically 65 cents to 69 cents, which is about 4 cents. What does that 4 cents represent overall in an increase in someone's property tax bill at the end of the year?

So... That's the one I asked you about earlier.

Let me see if I can...

And I know in the figures about if you had a $150,000 house, what's the yearly increase dollar-wise is around 80 or 100 bucks or whatever.

Yeah. One and a half, I mean $150,000 with a one cent increase is $15 a year.

So if you do, yeah. So Councilman Williams just said 6%. Is that accurate? We're basically...

SO THIS SLIDE SHOWS, AGAIN, $150,000 VALUE HOUSE. WHAT THAT WOULD MEAN OBVIOUSLY FROM THE CURRENT RATE WOULD BE NO CHANGE.

IF YOU WENT UP TO THE 2023 PROPOSED, IT WOULD BE AN ADDITIONAL $4.42 A MONTH OR $53 A YEAR EXTRA.

And so we still don't have a percentage that we can talk to that that we're basically asking to increase taxes.

I'M NOT FOLLOWING YOU.

YEAH. SO WE'RE TODAY STAFF HAS PROPOSED UNDERSTAND THAT THE VALUES ARE INCREASING SO EVEN WHEN WE TALK ABOUT WE DIDN'T INCREASE YOUR TAXES YOUR TAXES STILL WENT UP BUT THAT'S A TAXING ENTITY AND WE HAVE THERE'S NOTHING WE AS THIS COUNCIL CAN DO TO CONTROL THAT. I'M JUST LOOKING AT THAT FIVE PERCENT NUMBER AND THANK YOU FOR

YEAH, AND AGAIN, THIS SLIDE SHOWS THE $150,000, WHICH, AGAIN, IS KIND OF A MEDIAN VALUE, BUT IT SHOWS PER RATE WHAT THAT INCREASE WOULD BE, PER YEAR OR PER MONTH.

SO I GUESS IF WE BROKE IT DOWN EVEN FURTHER, WE COULD SAY $53 FOR THE YEAR. RIGHT. I MEAN, IF WE JUST WANT TO MAKE IT PLAIN, WE COULD SAY $150,000 HOUSE WOULD BE INCREASED $53 FOR THE YEAR. OK, now I'm going to get to my question, which was with Proposition A, how much of what projects are being done now? Could that number perhaps instead of assuming all the debt, right? Because that's what we would be doing. Proposition A, all debt would be maybe we could increase it incrementally, right? So what can that happen or is that not allowed to happen?

Well, yes. So we are, you know, the Proposition A authorized $58 million in new debt. We have only issued $38,750,000.

But how much of that is needed now? Because we're not, I mean, I don't know, correct me if I'm wrong, but we're doing $38 million worth of work in 27?

No, but it is very expensive to issue debt.

Okay.

Okay, that's what I'm... We're not just talking about interest costs.

OKAY. THAT'S WHAT I'M WONDERING. CAN WE BREAK DOWN WHAT WE NEED IN ORDER TO REDUCE WHAT WE'RE SAYING WE NEED? YOU KNOW WHAT I MEAN?

NEW SPEAKER YES. AND WE'LL SEE WHEN WE LOOK AT THE CAPITAL PROGRAM AND BASICALLY THE PROJECTS, CIP PROJECTS PER YEAR, WE TRY TO SPREAD IT OUT OVER THE YEARS SO THAT WE'RE NOT BORROWING MONEY JUST SO IT SITS IN AN ACCOUNT WE'RE NOT USING IT. SO THAT'S PART OF THE STRATEGY.

NEW SPEAKER AT AN EARLIER MEETING YOU TOLD US that as we need that money, that's when you issue the debt, you don't get the whole 58 million today.

Correct.

Spread that out over later years. Correct, correct.

We're always looking at those projects and seeing where we are, seeing the cash flow, and then when we need money injected.

On the increase in the employee benefits, that 9%, is that because they're charging 9% more, or is that just because to bring in more revenue? Is the insurance company, did the price go up on it 9%?

So it's an attempt to cover our costs, our health care costs, which are extreme. I think it's a way to put it. Go ahead, Bridget.

I was just going to say, because we are self-funded, so it's not the same as you go and buy an insurance policy. This is your cost. but we still have to pay someone to run it, right? Yeah, we do, but those costs are just going up as a whole, our claims, and I guess as a whole, health costs are crazy. They've increased and it's across the board. We're not unique. This isn't specialized to Beaumont.

Yeah, you may recall Holmes Murphy, our consultant, gave us that presentation at the last workshop session, I believe it was. So just, you know, just as an example, total medical pharmacy claims in 2021 was 22.6 million. It went up to 31 million in 2025. One of the things they talked about was that's really hurting our plan is these high cost claimants. And again, we have no control over that. But looking back over the last few years, we had twenty nine high cost claimants at about five point six million dollars in paid out and it was twelve point eight million this last year so you so that's what's hitting again we're self insured we have a stop loss policy but that affects that as well but that's the reason is we're having to figure out how to address that you know this is one And we're trying to attack that on several levels. One is this, and we're talking about those kinds of numbers. That's just a small amount. We're trying to do a better job educating our employees in terms of when it's appropriate to go to the emergency room and when it's not. I know it's confusing for folks when you have all these emergency centers and Is it an emergency room or is it an urgent care and all this? So we're working with Tracy and communications on a campaign to help with that, to help to get those costs down. But again, a big driver of those costs are these high claim individuals, which we really just don't have control over.

Talked about the freeze, which we already shorthanded. UNDERSTAFFED. SO THAT'S GOING TO PUT MORE WORK ON THE PEOPLE THAT ARE STILL HERE. AND THE BENEFITS GOING UP 9%. AND IF YOU SAY YOU'RE NOT GOING TO GIVE THEM THE 2% COLA, BASICALLY THAT'S A CUT IN PAY. THAT'S WHAT WE'RE ASKING THEM TO DO. SO THAT'S ON JUST THE CIVILIAN EMPLOYEES. FOR THE MEDIAN CIVILIAN. Have y'all looked at, when you was talking about your fleet and everything, what you had to spend on vehicles and stuff, have you looked at leasing them?

We have and do. We lease, yes.

And that hiring freeze is not going to help with retention either. Especially if you're doing more work and getting less money. That's not going to help with retention at all. THAT'S SOMETHING THAT WE NEED TO CONSIDER.

NEW SPEAKER Yes, sir. NEW SPEAKER THANK YOU, COUNCILMAN.

COUNCILMAN TURNER. NEW SPEAKER MR. BOONE, WHEN YOU SAY WE DO LEASE, AND I KNOW WE TALKED ABOUT FINANCING VEHICLES EARLIER, IS THERE A REASON WE DO MIXED USE WITH OUR CURRENT SITUATION? WOULD YOU SAY LEASING IS MORE COST EFFICIENT THAN FINANCING?

It depends on the vehicle. I can say historically we've leaned away from leasing. We've tried to buy our vehicles. The idea being that, and again, I think about a sedan or a police cruiser versus a fire engine. It just depends on the situation. But historically, I think we've not leased, but over the last decade or so, we've gone to that as an option. The issue with leasing is, of course, at the end of the lease, We often, you know, you run out of the five years and so you have to lease again. Whereas, as with anybody, if you think I can use this vehicle for 10 years instead of five, you spread your cost out over that time period. So there are pros and cons. Just like for us when we look at should you buy or lease, there's just different factors, but they play into this as well.

Your mic. What's the... What's the least expensive? Where you can save the most money? Do you do it leasing or do you do it buying?

Well, it's complicated and I can ask Jeff Harville to come up and comment, but again, like it's your own home, there's factors of if you lease a vehicle, it tends to be cheaper because you're just financing really the interest. Whereas if you buy it, the Monthly payments are higher but she but if you keep the vehicle for ten years then obviously your per annual is makes more sense however if it's out of warranty then you're you know we have repairs and maintenance and all that good stuff and so you have to factor that in as well so. You know, I know Jeff and our fleet group does a really good job of and they have a pretty sophisticated system of how much does the vehicle cost new? How much is it? How much is it to lease? What how much have we invested in repairs? And then what is that percentage? And again, depending on the equipment. You know there's there tends to be a break even to say look we're putting more into this vehicle for in repairs then we can buy it new and so it then it's like okay that's that's we need to look at buying or or leasing but again I mentioned at the beginning of the presentation I think the request was twelve million and that number is not you know not just once it's Because of course, like with any vehicle, the older it gets, the more money you're putting into it. I wasn't done.

You're not done? Just enough for me to make an educated decision. I like cost comparison on both. I know we kind of throwing it back and forth, but just for me to be able to make a concrete decision, I like to actually see it. My next thing is, are we to the point where you're looking for direction or you just kind of So are we at the point where you're asking for our opinion and what we had on everything or what?

Well, we can do it as we go. So, again, today is y'all are receiving the proposed budget. After this, we'll ask you to set the preliminary tax rate with the idea that September 8th, we'll ask you to adopt the final budget. So there is, you know, there is some time. um to make adjustments but we this budget is you know we've taken it we've taken feedback um you know from the prior workshops um and again we're struggling with some of these issues but this is this is what we're proposing so we're asking you to preliminarily accept it today set the rate preliminary today but there's still time to make adjustments

yes sir and uh it's just some things in limbo that i kind of struggle with because even with you know councilwoman sherwood x early about more revenue coming in and we we're kind of saying we're working on it but i know we talked about these industrial agreements for quite some time like i understand working on it but the part we in right now we kind of need to see where we at before we make these decisions because one thing that i've learned since i've been on council i'm just no longer comfortable making decisions about knowing all the facts and seeing financial analysis of before i give this increase how will this impact us in four more years i've asked that multiple times and i'm standing i'm saying and i've been told we can afford it but it looks like we're at a point where we gotta kind of

i can't just say okay and support it i need to see for a fact yeah i think that's fair i mean you know we don't do it much here i know some cities they will have a fiscal impact statement in other words when you're doing something big you know you always see in our agenda items that it's funded accordingly and it's in an approved budget but some things extend out multiple years and so um you know they do it in austin the legislature what's the fiscal impact of doing this and so we could definitely look to that going back to the you know the abatements and and ids it's it is any any expected revenues from those are included it's just um you know we talked about as we get closer to renegotiating a lot of these industrial agreements in fy 29 CAN'T REALLY DO ANYTHING UNTIL FY29 BECAUSE THEY'RE ALREADY LOCKED IN. I KNOW WE'VE HAD SOME RECENT ABATEMENT AGREEMENTS WHERE WE'VE GOTTEN SOME REVENUES. AND SO AS THOSE COME ALONG, WE CERTAINLY WILL OPERATE IN THAT MANNER AND ESPECIALLY UNDER THE NEW ABATEMENT POLICY THAT WE LOOK TO PRESENT HERE PRETTY SOON. BUT UNTIL THOSE THINGS ARE ACTUALLY IN WRITING AND WE CAN COUNT ON THEM, WE CAN'T INCLUDE THEM IN THE BUDGET.

And also, we kind of discussed some of these high claims and insurance, and we kind of kicked around maybe an in-house doctor. We did an analysis to see if it would be beneficial for us to go in that direction versus continue to see these costs rising because of, you know, if an employee says they're sick, they don't go see our doctor first. They go straight to the emergency room or where they may choose.

Yeah, I didn't mention that earlier when we talked about these different things we're trying to do to get that under control. But that is something we are looking at as kind of an in-house clinic. Whether we contract with somebody, some jurisdictions have a turnkey, they just run a clinic. That is a potential savings. The issue is it's a big upfront cost, and then you realize the savings over the coming years, but only to the extent that your employees participate in it. And again, Holmes Murphy has just let us know that there are potential savings there at but are big hits for these high claim individuals. So it's not gonna help. It's not gonna be a silver bullet.

Yeah, and just lastly for me, our regular employees don't have the pleasure of a union to negotiate on their behalf. So I have to speak to that. I have to explain to employers all the time when we give increases one way, and I gotta look them in the face and speak to why it's not the same for them. So for me, I just can't in good faith not do nothing for the employees knowing we're doing a hiring freeze and an increase in the premium cost for the insurance. Also, I'm not going to sugarcoat it. I'm not big on just raising it just to get to 20%. I can't talk around it. So me personally, I need us to figure out a way to find the money and figure it out. But I don't want to not take care of the employees who don't have that leisure of having someone to negotiate on their behalf. I've ran into several people and I feel them when they tell it to me. My second thing is, I'll just give you an example. Last year, we had budget restraints and issues and it wasn't easy, but we told the manager, you need to go cut it this much more. So that might be the point where we might have to just have some uncomfortable conversations and do what needs to be done. But just me personally, I can't hit the employees three different ways. I can't support that.

If I may. So our 20%, yeah, it might be lower than that, I mean, higher than the 16% that we've talked about, but we are also in a very unique climate, right? We are subject to hurricanes. We are subject to natural disasters, and all of those things are very expensive. So that's one of the reasons why... we do have a higher reserved fund balance. And kind of like Ms. Amy Schmidt had just talked about, a lot of the areas that we've cut, we've kind of already looked. We've pretty much already asked departments to cut to the bare minimum and what we have left.

And this is why I asked early, and I've asked multiple times, why bring increases to us that clearly we may not be able to financially afford if we're a part of a financial negotiating team and it's presented to council we're not in day-to-day operations now the decisions are on the backs of us but we're not in day-to-day operations so that's what my issue is by saying yes again because ultimately it falls back on us similarly when a decision is made it's blown out to the community the council said yes but the recommendation didn't come from the council so i i can't operate in good faith that way anymore

And I'd like to piggyback on that because what we're basically saying is police and fire, we negotiated these contracts that basically we can't afford and now everything else needs to be cut and nobody's going to say it, but I will, right? We have contractual obligations for over 60% of the budget going to a particular sect of people, right? And now can we go back to them and say, hey, will you not take a raise this year? Can we go back to them and say, hey, can we not contractually do this 3, 5, 7, 6, 8%? No, we can't, right? There are instances where cities have been on the brink of bankruptcy because they don't get an option to say they don't have the money for public safety. You got to find it when it comes to public safety. Well, we also need to find it when it comes to our employees. That's pretty much how I feel.

Thank you. Councilman Crenshaw, then Councilman Williams.

Well, I think Mr. Williams wanted to go next, Mayor, and that's fine.

And I heard it at several meetings about public safety and how much we spend, and it's tough for me to continue to let them be the, you know, the whipping child of our budgetary issues. I just think that is so unfair. I mean, we can point to, you know, some of us weren't here, but we've spent $5 million on the AT&T building for a piece of property that's now vacant, that's sitting there, that's not collecting any tax money. We've spent hundreds of thousands of dollars on hotel studies, on bond studies, and to sit up here every single meeting and say, public safety, public safety. Public safety is pretty important to the people of this city. People care about that. They want to feel safe. They want to go to dinner. They want to know someone's going to show up. And every meeting, we talk about them and what they do and what they don't do. And that's where our financial issues come from. And I think it's pretty unfair. And I think some of the past decisions of prior councils, whenever the money was good, whenever there was money in the bank and money was spent, it's coming home to roost now. And we're here and we're going to take responsibility for it and handle it. But I'm not putting this on the back of the men and women of the fire department, of the police department, of EMS. It's our doing, not theirs.

Councilman Crenshaw. And just to echo on that, I mean, yes, we spend maybe higher than the state average in public safety, but we also have one of the highest crime rates in the state. So, you know, when your crime rate's high, you've got to spend more on public safety. And when you ask people what issues are impacting Beaumont and keeping our growth down, it's crime in the school district. So, you know, we've got to address that. Okay, so here's what I've been wanting to say for the last 15 minutes. I went to BeaumontBonds.com, one of these websites we paid that high dollar consultant out of Austin to set up for us. It says, how much will this cost me on Proposition A? Total cost, 58.2 million. Estimated tax impact for a $154,000 Beaumont-valued home, $3.14 a month. I'm assuming staff is only asking us to increase THE G.O. DEBT AMOUNT WHICH VOTERS APPROVED IN 2025 BY ABOUT $2 BECAUSE WE'VE ONLY BORROWED $38 MILLION OF THE $58 MILLION. IS THAT ACCURATE? NO.

THAT SOUNDS. Yes. No.

Yes. That's why to me that just that's already setting us back. Right. And so what I would much rather staff had done was said, look, we told voters this is going to cost you an extra three dollars and fourteen cents a month in November of twenty twenty five. Voters approved it, and when you came to us with a proposal on the tax rate, we could have taken our current rate and added the $3.14 a month. That's already higher than the no new revenue rate of 68 cents. That would have been somewhere between the 68 cents and the 69 cents. So it's things like that. It seems like we're almost up here fighting against ourselves, and we're making this more difficult than it needs to be. I could have gone to people and said, look, I don't want to raise your taxes, but voters in November of 2025 approved raising your taxes $3.14 a month on a $150,000 valued house. Therefore, our new rate is going to be the current rate plus whatever it is, and that's what we need to do. And we wouldn't be here fighting over a lot of these issues that we're fighting on right now. So that right there is just a perfect example. And I'm not trying to beat up on staff at all. I know y'all have a difficult job. I love Laura Clark joining our staff and the amazing job she's doing over the money and finance. But these are the type of things that I think would make this situation so much easier to explain to people when we say we're not raising your taxes any more than what voters approved in November of 2025 and you know and we're only increasing it instead of all these crazy numbers the five percent that's just so much easier to explain or yes your taxes are going to go up about three and a half percent but that is what voters approved in November of 2025 so WITH THAT SAID, I'LL STOP TALKING.

Yes, sir. And accountability is one big thing. But, you know, we also have made decisions with accountability as far as on this council with settlements and lawsuits. We made decisions with, you know, services that we no longer oversee or take care of. And we made them decisions together as a council. All of us voted on not only those decisions, but also we voted on increases to public safety. Again, I reiterate. I ask all the time for financial forecasts as well. We can know how this will impact us if we make this decision. I voted for it, but what I'm saying is, in the future, it would make sense, it would be more beneficial to know, okay, if we do this, this is what we're looking back for in the future. And I've asked, prior to me voting for this, can we afford it? And if we can, that's great. But if we're in a position where we're at right now, some things we just simply can't afford. I'm just not okay as a council member to do one segment at this percentage. And I understand public safety is on the front line. But also to go out, and we literally just had a hole in the ground the other day, and people worked around the clock to fix it. And to tell those people nothing, I just can't in good faith support that.

Thank you, Councilman. And Councilman Durio.

Yep.

piggyback of what councilman williams said of course you don't want to put this on the back of a single set of employees but what about we kind of put it on the back of the rest of the employees that's that's my thing i mean they're all important those guys that fix the the hole over there the ones that fix the water thing um by the courthouse we're leaving one and going straight over there all our employees are important we shouldn't put this on the back of any of them at all none of the employee that's that's the only thing we're saying can't put don't put on the back of anyone and i want to ask you uh mr manager for us to be in this current situation is it a combination of lowering the tax rate but prices are going up would you say that got us in the situation that we're in right now

It's a combination of factors.

Would you say it's wasteful spending?

No, necessarily. I'm just saying when you have an operation of this size, there are always efficiencies that can be found, and I think we'll find them. Part of this discussion is spending FY20, the rest of 26 and 27, really digging in to find those efficiencies. Some of it's going to take You know a lot of work because some are easy summer low hanging fruit where you can say look we're doing this and we can do this and save some money here do we really need to do this it's but it has to be thought about and that's where the department directors division managers and employees can can help us there. um you know efficiency studies are going to take a little bit longer um so i think there are some low hanging fruit and then some middle hanging fruit um that we can find and that's what we're going to be doing the end of through this fy26 and into fy27 because one of the things we talked about last year is is instead of waiting to you know the summer to get into how are we doing and not that we don't have monthly reports, we do, but do a mid-year, mid-fiscal year check-in in April, and say this is where we're at, because things are more dire, then we'll have to take a look, but hopefully by that time we will have found some of these efficiencies. So it's a combination of taxes and inflation, and as we talked about, the issue with the insurance and AND ON AND ON AND ON. SO IT'S A VARIETY OF FACTORS.

NEW SPEAKER I JUST WANT TO KEEP IN MIND THAT ALL OUR EMPLOYEES, THEY HAVE FAMILIES. AND WE'RE GOING TO NOT GIVE THEM A RAISE AND GO UP ON THE INSURANCE, THAT'S BASICALLY A CUT IN PAY. AND THEN WE'RE GOING TO BE ASKING TO DO MORE WORK BECAUSE WE'RE ALREADY SHORTHANDED. AND I THINK ALL THAT NEEDS TO BE TAKEN INTO EFFECT. They all work hard. Public safety, water department, drainage, everybody, you know. So I don't want to put it on the back of just one set of people. But we got to take into effect. These people have families to support. Evidently, they must like working for the city of Beaumont because they could have left here a long time ago and made more money somewhere else. But they stay here. They support us. So we have to support them. We have to have their back, too. And can't put all this on just their back. I have one other question. So basically, on what Councilman Crenshaw was just saying, we're just asking for like one penny more than what the voters approved with the bond? No. WE'RE ASKING FOR LESS.

WHAT I'M SAYING WAS I WOULD RATHER STAFF HAD COME TO US WITH THE AMOUNT THAT VOTERS APPROVED AND VOTED ON IN NOVEMBER OF 2025 INSTEAD OF LESS, WHICH I ASSUME WHEN WE BORROW THE OTHER $20 MILLION THAT WE HAVEN'T BORROWED YET NEXT YEAR, THE YEAR AFTER THAT, WE'RE GOING TO COME BACK AND ASK TO INCREASE OUR GEO DEBT amount again and i just think that we're fighting against ourselves it would have been a lot easier from the beginning if we would have just come in and said voters approved the three dollars and fourteen cents increase a month on 150 000 house that's what they're expecting and that's what we're proposing that we do and the numbers would be a lot better than what we've got right here

And I said that several times, and I've been trying to figure out why are we performing as if this hadn't already been approved? Because people already knew that taxes were going to go up. We're saying we're not raising taxes. Yes, we are, because they said so. Either you're going to go with what the people have already said, or you're going to not perform what they have already said is necessary to do, which would have been simpler because, yes, we're arguing about something that must happen.

THE BALLOT LITERALLY SAID THIS IS A TAX INCREASE. WHICH STATE LAW REQUIRED. NEW SPEAKER COUNCILMAN WILLIAMS.

NEW SPEAKER THE TAX RATE PROPOSED TODAY IT IS ABOVE Right? I mean, I'm not following.

It's only proposed to go up to 60. The 65 plus the geo debt rate only increases to 67. So that's why the $3.04 on 68 cents threw me off because I thought we said this was going to cost more on the bond. And so the ballot said the $3.14. That's what we educated voters on on the increase would be, which they approved. And so to me, that should probably be somewhere between the, it's less than what staff is recommending today, but it's higher than the no new revenue rate. I'm assuming going by y'all's numbers.

The rate with the current rate plus the bond rate was like 0.675.

It is, it is, it is, it is.

And the no new revenue rate is what 0.683%

But what I'm saying is they did not include all of the bond money on the geo debt rate that they proposed to us because they've only borrowed $38 million. But taxpayers already in November approved. I'll follow you now. I'm assuming that's what they did.

I don't know that. THE INCREASE THAT'S GOING TOWARDS THE BOND, THAT MONEY CAN'T BE USED ON THE REST OF THE BUDGET. IT JUST HAS TO BE USED ON PROJECTS THAT GOES WITH THE PROPOSITION.

NEW SPEAKER Yeah, THE ADDITIONAL INS, THE ADDITIONAL DEBT SERVICE IS SEPARATE THAN THE M&O RATE.

NEW SPEAKER OKAY.

The current, because it's not broken down here, but the current debt rate is .181, and in order to cover the new debt, it needs to go to .214.

But is staff going to come back to us next year when we borrow the other $20 million and say that the INS has gone up again and we need to increase again? That's what I'm saying. I don't understand why we broke that up when... Voters already approved it in November. Why didn't staff come to us and say, this is what the rate needs to be because this is what was approved?

I wasn't here then, but what I can say is, so the tax rate is broken up between the INS and the M&O. The INS rate is a calculated rate that comes from the tax office based on you turn in what your debt requirements are going to be for that coming year. And then it calculates that debt rate. And then the M&O rate is where you have a little bit of wiggle room. And so while I've been late to this budget process, what I saw was that the debt service overall, it was going up just over three pennies. so that was that 18 cents to 21 cents and then the 0.695 allows a small increase on the m o side just a very small increase versus it staying the same but at the very least if you don't change the overall rate because of the shift to the three cents then you're actually taking that money out of the general fund and that's funds that it had had the prior year and what wouldn't have now so i think that is part of you know the manager's recommendation to shift the three pennies and have a small incremental increase in the m o

And that makes more sense then. So in essence, the $0.03 represents only the $38 million out of the $58 million that we borrowed. And that if we would have borrowed the full $58 million already, that $0.03 would likely be higher, maybe around $0.045 or whatever. And you would have recommended the higher rate. And so that's why we're not doing that right now.

Right. It'll calculate a higher rate as more debt is added. In addition, I believe there's some certificates of obligation that have been issued in order for maybe street rehab and some things. And then also the tax note that was approved in this budget, the 26th budget for fleet purchases. So that will also have debt requirements. So all of that gets figured into the debt service calculation, the INS calculation.

But to answer your question, when we get to that point to get the additional tranche of money, yes, we'll be coming back to you and say, hey, we need more.

And that's what I said. And to me, it would have made sense if we did it all at once, but now I understand why we're saying we're having to break it up because we can't increase, is it the INS? Okay, we can't increase the INS over what it actually is. Gotcha. So I think I'm still back then, well, for whatever it matters, I'm still back then at the .67.

Ms. Moon, at the different rates that you showed us, how would that each different one affect our, I think she had mentioned before, our bond rating?

Well, we can't know for sure, but on our bond rating calls, they have expressed concern about the gap between revenues and expenditures and trying to close that gap. Bridget, do you have any thoughts on that?

Yeah, so that is, you know, because they've asked, hey... We're seeing you dipping into your general fund. Are you going to stay at your 20%? They have specifically asked that. And if we continue to dip into our general fund and we're not closing that gap and we don't have a plan, they want to see a plan for us to close that gap. And not only that, they want to see it come to fruition. They want to see us appropriately carry out that plan. And that's what... THIS BUDGET IS DOING. SO THAT WE DON'T GET OUR BUDGET.

I'M SORRY. THAT'S WHAT IT'S DOING. PLAN TO GET THAT. YES.

EXACTLY. SO THAT WE DON'T GET OUR BOND RATING DEANED AND SO THAT, YOU KNOW, DEBT AS WE'RE ISSUING IT ISN'T MORE EXPENSIVE FOR THE CITY.

Councilman Williams.

Whenever you're having these conversations and they're expressing the concern and where we're headed, I know that you weren't in that position and Chris wasn't in his, but have they said if they shared the same concern with the shrinking fund balance over the last four or five years, or is this the first time that they've said we're now concerned about it?

I can't speak. It's been consistent. Just because whenever we have to go out for debt, when we're issuing debts for certificate of occupancy, we have to do a due diligence document. Some of the questions are the same. Projected expenses, what are we spending? So there's not a direct question related to our general fund, but they do ask about revenues. They do ask about expenses. The documents, the due diligence documents don't change. I think now the questions probably are more targeted. BUT IT'S BASED ON OUR OWN FINANCIAL POLICIES, BUT THE QUESTIONS IN THE DOCUMENTS HAVE BEEN CONSISTENT ON, LIKE, WHAT ARE YOUR REVENUES, WHAT ARE YOUR EXPENSES, WHAT ARE YOUR PROJECTED THINGS, AND THEY BASE THAT ON ESSENTIALLY WHEN YOU ISSUE DEBT AT A CERTAIN RATE, LIKE, IT'S YOUR CREDIT SCORE, YOUR ABILITY TO PAY IT BACK.

BUT SURELY THEY WERE CONCERNED AS THE GENERAL FUND WENT FROM $50-plus million to where it is now. I mean, they've raised these concerns every year, I guess, is my...

So what I'm saying is, like, what she's presenting as a concern is that the document itself, the questionnaire itself, doesn't really change. So there's always been questions about our revenues, like, what's in your general fund, what's in your thing. So I'm assuming in the last couple years, because the amount of our... GENERAL FUND BALANCE AND COMPARED TO OUR REVENUE SPENDING OR THE AMOUNT OF MONEY THAT WE SUPPLEMENT FROM IT HAS BECOME A QUESTION. LIKE WE'RE SUPPLEMENTING MORE. BUT IT HASN'T REALLY BEEN THERE HASN'T BEEN A TARGETED CHANGE IN THE QUESTIONNAIRE THAT WE'VE SEEN.

AND WHEN WOULD LIKE A TRIGGER HAPPEN I GUESS TO WHERE IT WOULD IMPACT YOUR BOND RATING?

WHEN DOES THAT HAPPEN? WE DON'T KNOW. IT'S KIND OF LIKE WHEN YOU have a credit score. It seems to be a very complicated formula. But to that end, as the city attorney was mentioning and the CFO, they're looking at trends. And so they see what the trends have been. And so as Mitch Evick mentioned, I mean, they're asking us about it. So at what point is it a deal where, guess what, we're going to have to raise our INS rate higher than we would have because our score just changed? I don't know. But those questions are being asked.

Your bond rating.

I can't say that for sure. I can just say these questions are asked when they're setting the bond rating.

So whenever we bring this back, we finally approve everything. Are y'all to go back and look through everything and make sure that everything was figured out right and correct and double check and all that stuff? Yes, sir.

and let's do keep in mind because we want to draw this forward for for i think for household budgets is our general fund comes from our sales tax and our property tax like this year we had a percent and a half increase in our property tax revenue if beaumont was growing more perhaps we would have had a five percent so you know and certainly that's what the state of texas is seen to be able to have surpluses is larger amounts and the same with sales tax so like right now at this point you know hopefully using best projections uh and good practices we're projecting what those sales tax and property taxes are going to be but there's many things that can occur throughout the year that can have impacts on that that we're not going to know about now and certainly in in years past we've done that and we and you know we we had significant like personally i'd get concerned about sales tax continuing to go up because i see more and more amazon packages being delivered and those we don't get the sales tax revenue from because they're not from if i'm correct on that it has to it has to be from the last point of sale But we should pretty soon.

I just saw that building yesterday.

And I don't know when, and that could end up helping it, but I don't know if, when I asked that question before, my understanding it was the place that ships the product is the one that gets... Gets last mile. Yeah.

You said last mile? So if it comes from there, if they ship it, then Beaumont will get the sales tax off of it?

No.

No?

No, we ship

Councilman Turner, can you turn your mic, please?

On what's being shipped from the Beaumont location once it's built. That's true. And we don't know what that number is going to be at this point because we don't. So that's always going to be projections on revenue and certainly on expenditures, too. And so what they're presenting to us is what they believe to be best at this point. Okay.

So again we just talked about the variance from the proposed six nine five rate. What that means in terms of. The ending fund balance. And so again proposed property rate. In in terms of what we're talking about here is flattening the curve right so we just talked about. The ending fund balance curve as we talked about the beginning the presentation it was it was a little more dire. but we feel like this proposal starts to flatten that curve where we might get some less pointed questions from the bond rating agencies so again accommodating the bond election debt co debt we seek to balance desired tax rate with needed services we've talked about proposed increases and contractual ones allows us to continue to find efficiencies as i mentioned this is an ongoing process um talk we've talked about the freeze and the impact the longer it goes on the greater impact potentially um and then again we've we've talked a little bit about federal and state mandated undate unfunded mandates we have several hundred thousand dollars IN THIS BUDGET THAT WASN'T REQUIRED LAST YEAR, BUT BECAUSE OF STATE UNFUNDED MANDATES, WE'RE HAVING TO COVER THOSE COSTS. so at the end of the day this we've seen a similar slide before with prior projections but this is what is included in your proposed f y twenty seven budget and we talked about most of these numbers we've seen in the graphs but the idea is you can see the the dipping into the fund balance is greatly reduced and again the idea is to try to try to slow down that until we can allow some revenues to catch up with expenditures and again same slide just giving you the history of dipping into that fund balance. With that before we get into the solid waste rate change any other questions about the general fund.

Not will jump into this one more question I just thought about. Y'all were looking at this COLA increase. Did you get to 2% and you just stopped there? Y'all didn't look at what 3% would be like or 2.5%?

We did. We would like to give 3%, but we're just trying to balance it with the challenges that we're facing.

I hope we can continue looking and see if we can make that happen.

Okay. So going into the solid waste change again we're not proposing an increase in. Our garbage rates that we are as discussed in prior proposing an increase of five dollar. per cubic yard of tipping fees compacted and compacted to kind of get us to a more statewide average and even a regional average and giving us some revenue knowing that we're going to have some expenditures coming down the line to try to put in some new cells at the landfill to extend the life. Any questions on the solid waste program yes sir.

COUNCILMAN TURNER. NEW SPEAKER I KNOW WE KIND OF TALKED ABOUT THIS. IS IT STILL ONE LINE? DID WE LOOK INTO A COMMERCIAL LINE AND A REGULAR LINE?

NEW SPEAKER YEAH, I THINK WE STILL HAVE ONE LINE, BUT I'LL ASK FERNANDO, ANY COMMENTS ON THE LINE GETTING INTO THE LANDFILL? ARE WE STILL ON ONE? NEW SPEAKER ON THE LINE? NEW SPEAKER I GUESS QUEUING UP TO GET INTO THE LANDFILL.

NEW SPEAKER OH, THE LINE DOESN'T.

THERE'S NO TECHNOLOGIES.

YES, I'M SORRY. THE LINE ON THE LANDFILL IS BASICALLY WHEN IT RAINS IS WHEN WE HAVE TO DEAL WITH ALL THE MUD WHICH WE HAVE TO CREATE A ROCK ROAD TO GET UP ON TOP OF THE LANDFILL AND THAT WAY WE MINIMIZE THAT WAIT TIME. BUT WE'RE STILL WORKING ON THAT, WAITING FOR THE NEXT BUDGET SO I CAN BUY MORE ROCK.

OKAY.

CAN'T DO IT WITHOUT MONEY.

YES, SIR. So my question is, well, there's more than one, but first, when are we going to start selling our methane? Do you know when that line is going to come on and we're going to start? On the gas line?

Yes. It should be done in October. We should start seeing some, actually the gas going across.

Okay.

We have our inspection for the preliminary gas supply. audit to see if we're make sure we're covered properly to capture all the gas and then we'll go from there do we see do we have any uh anticipated ex revenues from that have have we done any uh anything on that no i have heard the quality of the gas is good so that's i have heard that but i haven't heard the volume yet until we bring down some of the water in the landfill so that we can up the generator up the gas rate that we're trying to produce okay

And my other question is, you know, how many cities in Texas provide free refuge pickup? When I say the claw, basically, that comes in and picks up solid waste, trees.

Yeah, most cities that I've worked in, when it comes to heavy trash, it's once a month. And, you know, that's it. Once a month for, you know, every location within the city.

Have you looked at what kind of savings that would bring if we just did that once a month?

I have not. But the problem with this location is the rain, heavy vegetation. Unless the people that cut it down take it to the landfill, it's going to build up. Right now we do heavy trash as consistent, about 750 tons a week. Okay. That is a week.

Right.

So, and we pick up every week. We also pick up about 700 to 800 tons of regular garbage, residential garbage, every week. That doesn't include the 1,200 tires that we pick up and have to process and or ship out, which there's no revenue for. That's all what we do for the city. What is that costing us? Well, hundred and twenty time a thousand two hundred tires a month is what we receive just in the tires to dispose one trailer uh you're looking at probably two trailers if we shipped it all two to three trailers if we shipped it all that's about let's say twelve thousand dollars just to ship that trailer out fully loaded and we don't charge and we don't charge so

SO NOT FOR TODAY, BUT ONE OF THE THINGS WE'RE TALKING ABOUT IS HAVING SOME CONVERSATIONS ABOUT LEVEL OF SERVICE AND WHAT COUNCIL WANTS TO SEE MOVING FORWARD AND WHAT IMPACT THAT MIGHT HAVE ON THE BUDGET. NEW SPEAKER THANK YOU.

thank you you got a question yes the tires are you talking about shipping out are those that are tires brought into the landfill or is that stuff y'all picking up on the side of the street uh that's basically what we pick up okay and we had calls and we we uh we either get residents calling us for tires or the drivers as they're driving by sees tires they call them in so we segregate those and send a truck out to go pick those up when we have it available

Now, if you have tires, people dropping, bringing tires to the landfill, is that something you could charge them for?

Oh, we are charging for that, yes. Those do get charged for. But everything we pick up, anything solid waste touches.

Do the refuge on the curbs. Because I know a lot of tree services will give you two prices. Our price to haul it to the landfill or another price for us to put on your curb and let it be picked up for free. Same thing goes with remodeling. They'll say, hey, we'll bring a trailer out here or we'll just dump everything on your curb and let the city pick it up. And so I would like to see charges.

We're not supposed to pick up construction debris. But we do.

NEW SPEAKER I know. I know. But I'm just thinking outside the box. NEW SPEAKER Correct. Everything that we handle, there is no revenue for.

NEW SPEAKER Thank you. NEW SPEAKER Thank you very much.

NEW SPEAKER Sure. So on that same note, as business owners, and I know there's a bunch of us up here that are business owners, when a department or a company is losing money, you don't just look at your administration staff. You begin to look at the efficiency of each department. and a department head may not think something needs to be cut good examples good sam that saved us three hundred thousand dollars but it wasn't asked to be cut from the budget so i would like to see an efficiency study you know uh water department drainage department how many men do we actually need on a crew how many men are actually working you know do an efficiency study you know look at what's going on because that's what we do you know if a department is losing money or one of my rigs is losing money or stores losing money we don't go hey we're going to start cutting upper staff we go to that store and we find out what's going on do we have too many people staff there you know what is the problem that's going on and so i don't know if we've actually looked at that or if we've just said hey each department head find what you can cut

and let's cut it versus saying let's let's see how efficient each department is running and can it run better so that's just my thank you okay nothing else on the solid waste we'll move into proposed changes to water and waste water rates just a quick history on wastewater and water rate increases. As you all recall, we had HDR present an analysis and recommendation that they've been doing for the last few years at two separate workshops this summer on the budget. This is a portion of the proposal that Then Grady Reid presented back then, and so you can see this is you see the new debt being added. So what they're doing again is forecasting based on revenue projections and new debt obligations. and so the proposal in the budget is no increase to water rates but as mentioned revenues in the wastewater portion of the utilities fund are not covering expenses and so there were several proposals that were presented and so we're recommending scenario B which is a five percent increase in the demand charge which is kind of your base charge for all non senior customers no increase to the volume rate for single family residential and then a seventeen increase rate for the others which tends to be commercial and industrial and this is a breakdown that hdr posed and again you can see like for example the senior citizen five eights meter no increase BUT THAT'S WHAT'S BEING PROPOSED.

NEW SPEAKER SO THIS IS THE MR. MAYOR IS OKAY.

NEW SPEAKER YES GO AHEAD.

NEW SPEAKER IS THIS THE SAME GENTLEMAN THAT CAME AND SPOKE TO US AND I ASKED HIM I SAID HOW CAN WE HAVE GOOD NUMBERS WHEN WE HAVEN'T GIVEN THEM GOOD NUMBERS BECAUSE WE DON'T ACTUALLY KNOW HOW MUCH IS NOT BEING COLLECTED ON OUR AND HE ACTUALLY LAST YEAR CAME TO US AND SAID WE NEED TO DO A WATER RATE INCREASE AND THEN CAME BACK THIS TIME AND SAID MY NUMBERS WERE WRONG WE DIDN'T NEED TO. so i before we start raising rates i think that we need to make sure that we have a hundred percent collection on these i mean we we have no idea how much money we're not collecting and everybody's going to see a 50 or 75 increase in their water bill because a lot of the meters haven't been read correctly and so before we start raising rates i think we need to make sure that we're getting 100 collection and then we have good numbers that we know that we can choose from and so that's again my my thoughts

And this is just a quick snapshot of the many funds that, well, some of the funds, we actually have more than this, but these are the primary funds that the revenues versus expenditures and kind of where we end up. and again you'll see that the employee benefits fund the municipal transit fund is as is typical will have to be short of. And with that it are there any questions before we jump into the capital improvement plan. Go ahead all right so. AND AGAIN YOU'VE SEEN THESE SLIDES BEFORE THIS IS JUST THE FY TWENTY SEVEN THROUGH TWENTY THIRTY ONE CAPITAL IMPROVEMENT PLAN YOU'LL SEE THERE THE I GUESS KIND OF SALMON COLORED ON THIS SCREEN THAT YOUR CO THE GOLD INDICATES THOSE ARE WE WOULD CONSIDER MORE GIO A LOT OF THOSE IN GOLD CAME OFF OF THE The bond election, I think the idea was to keep them in here, but set them beyond FY28, which would be the earliest for reconsideration of any kind of debt issued or a new bond election. But again, the idea is this plan is looked at every year as part of the budget and can be adjusted accordingly. You also see a lot of these projects are pushed out to future consideration. So these are the parks components. Again, some of these are underway currently. This is the facilities. Downtown development. Again, most of these, a lot of these were tied up in the bond consideration, so they've been pushed out to future consideration. And then we get into the water. And you can see, I believe the green is revenue, bonds, the blue is grant funding. So you can see Pretty substantial amounts here that it speaks to the amount of infrastructure we have in the amount of work that we need to do to to make sure it's operating properly. And this is the wastewater side. So like the 23rd Street sewer trunk line, you'll see all the, and again, y'all have the CIP in front of you.

Yes, sir. Chris, just a quick question. On that slide where we're talking about $9 million next year in water improvements, I think it was the next one. Yes. So annual water line replacement, 9.1 million for 2027. What does that 9.1 million include? Is that just the cost of going out and actually replacing the line and the materials? Or does that 9.1 million include the salaries that we pay water people to do?

you know this pipe bursting out molly really round speak to that.

So wages and salaries of what utilities employees are plate paid out of our annual budget the nine million dollars of annual water line replacement represents the part of that is the inventory in the what utilities warehouse for the water lines valves and fittings uh in addition to the uh many water line replacement projects that we have such as the previously the water the gladys water line replacement okay uh highlands uh water line replacement as part of the highland project is paid out of this line item and similar projects okay so 9.1 million in 2027 is both materials we have in the warehouse and money we pay to contractors to for the water line replacement That's correct. And we arrived at that approximate 9 million per year because our objective is to replace approximately 1 to 1.4 percent of the water distribution system annually.

Okay. And maybe I'm just not seeing it really quickly, but what's the amount we're going to spend next year to improve the sewer lines so they don't back up in people's houses?

so that's covered in a couple of them so we have the counterpart to the water annual waterline and we have the annual collection system renewal which is at a for f twenty seven estimated at six point one million dollars and also our annual lift station repair and improvements which is estimated for f twenty seven AT $940,000 IN ADDITION TO MULTIPLE INDIVIDUAL PROJECTS THAT HAVE THEIR SEPARATE LINE ITEMS.

WHAT'S GOING ON DOWNTOWN? WHY ARE WE SPENDING 4.6 MILLION ON SEWER THERE? THAT SEEMS LIKE A BIG NUMBER AND IT SEEMS LIKE THE CALLS WE GET ABOUT SEWER AREN'T NECESSARILY DOWNTOWN AND THEY'RE IN THE RESIDENTIAL NEIGHBORHOODS.

SO PART OF THAT IS RELATED TO CONVERTING TO EXISTING DETERIORATING DOWNTOWN LIFT STATIONS TO A NEW CENTRAL LIFT STATION AND TO REHABILITATE THE EXISTING 30-INCH CONCRETE SANITARY SEWER FORCE MAIN.

AND WILL THAT HAVE A POSITIVE IMPACT ON SEWER ISSUES ACROSS THE CITY OR IS IT MAINLY JUST FOCUSED ON DOWNTOWN?

IT DIRECTLY IMPACTS THE AREA NORTH OF DOWNTOWN, YOU KNOW, YOU'RE LOOKING AT THE BASSINITY OF JUST NORTH OF DOWNTOWN FROM ABOUT THE I-10, I'M SORRY, MAGNOLIA EAST AND THEN UP NORTH PAST EAST LUCAS.

NEW SPEAKER I HEAR YOU. I'M JUST TRYING TO FIGURE IT OUT. SO I GENERALLY TELL PEOPLE WHEN THEY COMPLAIN ABOUT THE CAN'T FLUSH THEIR TOILETS, I SAY WE SPEND 6 MILLION A YEAR TRYING TO IMPROVE THAT OUT OF OUR ENTERPRISE FUND. WHAT IS, AND I DON'T NEED AN EXACT AMOUNT, BUT JUST A BALLPARK FIGURE, WHAT ARE WE GOING TO SPEND TO IMPROVE THAT FOR FISCAL YEAR 27? could you repeat that question so I generally I tell people when they say they can't flush their toilets to say the city spends about six million dollars a year improving our sewer lines so that you can flush your toilet when it rains it looks like in twenty twenty seven we're spending a lot more than six million twenty six. Six million okay so that's what we can says operations. So we get to say twenty six million yes okay great.

Okay. If no other questions, let's see. These are more CO street and drainage projects. THIS IS A TOTALING OF SO AGAIN LOOKING AT INFRASTRUCTURE IT'S A CONSIDERABLE AMOUNT OF INVESTMENT AND IN CONCLUSION YOU KNOW AGAIN AS MENTIONED EARLIER WE WHILE WE CAN'T CORRECT COURSE IN A SINGLE BUDGET YEAR WE FEEL LIKE WE ARE ON THE RIGHT COURSE I WILL SAY THAT CITY STAFF IS DOING AN AMAZING JOB CONTINUING TO SERVE THE CITIZENS, THE STAFF, THE DIRECTORS, THE DIVISION MANAGERS. AGAIN, THIS IS GOING TO BE AN ONGOING PROCESS AS WE GO INTO 2027 TO TRY TO FIND SOME EFFICIENCIES. SO I APPRECIATE THE WORK THAT THEY HAVE DONE AND ARE DOING. AND THEN FINALLY, SPECIAL THANKS. To Laura Clark, our deputy city manager, Bridget Evick, our CFO, Amanda Hill, our assistant CFO, and Amy Schmidt, our budget officer, who has spent tireless hours working on getting us to this point. But with that, are there any additional questions?

Councilman Turner. This kind of came up briefly earlier, but in the past, I know the city wanted a certain amount of revenue in case of a storm, the city would have to get everything back going. But correct me if I'm wrong or to my understanding, if it's a storm, don't we now pay a deductible versus having to pay everything out of pocket up front?

Well, I think the bigger concern is operating expenses. immediately during and after because you have a lot of additional expenses. So that's the big concern. Traditionally, we've gotten FEMA funding for certain things, but that seems to be harder and harder proposition.

Similar to the COVID situation.

Yes. And so I think you go back to You know what is a comfortable fund balance again the policy is twenty percent. We've talked about the gfo way the general accounting the government accounting group is wreck recommends about sixteen and a half percent as a minimum because that translates to about two months of operating so. It's just it's all together I mean every city faces challenges but you know with our history and experience with storms we know that they can we can be expensive propositions and they can take a lot of time and money to recover from.

but but the quick i just want to know in case of a storm do we pay a deductible now or is it the way it was structured when we're experiencing the storms where the city had to put the funding up and we had to wait to bring be reimbursed MEANING THE WAY WE'RE INSURED NOW.

I MEAN, WE'RE INSURED THROUGH TM.

SO IT SHOULD BE DIFFERENT. IT DEPENDS ON THE CLAIM. SO A LOT OF OUR HEAVY EQUIPMENT AND NEW VEHICLES AND STRUCTURES ARE COVERED IN ONE STORM AND UP TO A CERTAIN DOLLAR AMOUNT. BUT ALSO THERE ARE OTHER EXPENSES THAT GO WITH THE STORM. SO IF YOU'RE ACTING SOLELY ON DAMAGE A lot of our a lot of our infrastructure would be covered by claims. But if you're talking about the other intangible costs, for example, doing a city shutdown contracts for police and fire have shut down pay, which is substantial callback pay calls into question. So that's different and separate from our normal overtime and normal general payroll expenses. THERE ARE ALSO SOME THINGS THAT WOULD NOT NECESSARILY BE COVERED BY THE STORM ITSELF OR THAT WE WOULD NEED TO REMEDY QUICKLY IN ORDER TO RESUME NORMAL CITY FUNCTIONS. SO FOR EXAMPLE, IF THERE WAS DAMAGE DONE TO THE JEFFERSON THEATER, WE COULD POTENTIALLY, THAT WOULD OBVIOUSLY DISRUPT SOME OF OUR EVENTS, FACILITIES, OPERATION AND REVENUES, BUT WE WOULD BE ABLE, THE CITY AS A WHOLE WOULD BE ABLE TO FUNCTION, CORRECT? If there was damage, a substantial damage done to City Hall, where a primary of our functions for IT, as well as the day-to-day operations for city water functions, we would probably need to consider paying those expenses upfront while we waited on that, before we waited on that claim to be processed. Same for if there was substantial damage to our water facilities that happened during Harvey. We had to upfront a lot of that cost just because the water system itself was impacted. So we needed to get the operations up and running and then wait to be reimbursed. So we would have been insured by TML at that time. The city would have had to make a decision to whether or not we waited for our claim to be processed before restoring clean water and portable water to our citizens or whether or not we wanted to upfront the cost

to perform this uh the repairs ourselves in order to get the city back operation and functional so those are some some things um to consider and see and the thing about that is and i know that's at a level a federal level we can't control but similar to the city's mind frame at the time when covert took place was maybe we do this and it will come back and As of right now, that hasn't happened. And that's what scares me in these situations when you spend these funds up front with the expectation of getting them back in return.

So in those regards, like even when we're spending for those things, we document for the ability to be reimbursed by FEMA, but it's never with the intent that we're going to get a full reimbursement. We operate on the ability to maintain normal operations. What's the bare minimum that we have to do in order to get the city back to a functional point to where we're no longer on a city closure? Because a city closure is expensive, right? We're paying employees who are on salary who are not here. Our part-time employees are getting no benefits. part-time or hourly employees get no money unless council approves for them to get a salary. And then you have our EMS and our public service guys who are working essentially around the clock to maintain the city, but also to do additional duties to make sure the city stays safe and functional. So per their contract, they're paid at a different rate under the city closure payments. So there are some things that are essentially we track because in the past FEMA had recovered those costs, but we're not just doing it because, oh, we're going to get our money back. We're doing it because that's the bare minimum we have to do to maintain a functional and operational city. So while everybody else is staycationing and bunkered up at home, we have people who are still out working to get the city back to a functional state. So during COVID, obviously everybody else is at home and they were socially distancing, but we had to figure out a way to make the city operate, right? People still wanted to build, people still needed to pay their water bills, and people... the city government still needed to do. So we need to figure out a way how can we maintain city operations and still protect the citizens, but also the employees. A lot of our COVID expenses weren't covered. It's because FEMA said that that's something that you would have normally did anyway. And so it's different from a natural disaster where you can tell that there's some damaging things where you had to do the things to get the city back up and running. But a lot of things that we did during COVID were things that we would do anyway. We just had to do them differently. So there's a lot of like mechanics that go into place with that. But if you're talking about moving forward, if we had another COVID, I think that, you know, obviously we have more opportunities. technology in place to address it but if we had a hurricane that happened to next month September typically seems to be our a big hurricane I'm not gonna live when I say that but if we had a hurricane next I suppose say it at all sorry I'm here but if you had a hurricane next month the thing we know that FEMA has it's traditionally becoming harder to get reimbursed right but we also know that it takes years for that money to come back If there's a damage to our building, like any other claim, it would be processed through our insurance, right? How long do you want to defer city operations before we process that? How long do you want to wait before we restore services to our citizens? So having the money up front and then getting the money back from our insurer, we would just say, hey, this is what we spent. We know this would come as opposed to fighting with them on what a valuable what it's going to cost to repair and getting the quotes. This is what it costs, right? We have emergency contracts in place. This is what it costs. This is what we need to do to restore service to our citizens to get it back on track. As opposed to saying we're going to submit the claim to our insurance, go through the adjuster process, wait, wait, wait, then go out for bid. THEN HAVE THE PEOPLE COME IN AND THEN DO THE WORK, RIGHT? WHEN YOU'RE DOING WORK UNDER DISASTER AND EMERGENCY SERVICES, THERE'S A DIFFERENT BIDDING PROCESS. WE GET TO USE THE EMERGENCY CONTRACTS WE HAD IN PLACE AFTER THE DISASTER IS SETTLED AND THERE'S NO LONGER AN EMERGENCY BECAUSE AT SOME POINT YOU'RE SAYING, your citizens have been without service for 30 days versus your citizens have been without service for three months. Where's the exigency? So there's a lot of things that kind of come in play when we're weighing on that. And even though we definitely have good insurance coverage and claims through TML, we're also having to weigh whether or not that's an expense that we better serve paying cash versus paying the deductible in having those claims INCREASE OUR COVERAGE, OUR PREMIUM COST DOWN THE LINE.

AND I THINK THAT'S KIND OF A TOUGH SITUATION TO BE IN, DUE TO WE DO ARE NOW SET UP THROUGH THE RISK POOL, BUT WE HAVEN'T EXPERIENCED IT. AND I DON'T KNOW IF SOMEBODY ON STAFF HAS EXPERIENCED IT. THAT'S WHY I ASKED THE QUESTION, WHAT IS THE...

SO I DO HAVE CITIES, AS YOU KNOW, I SERVE ON SEVERAL BOARDS WITH THE TML, AND I HAVE WORKED WITH CITIES WHO HAVE FULL DISASTERS. FOR EXAMPLE, ONE OF THE ATTORNEYS WHO WAS working when they had the fourth of july floods when their entire city was catastrophic tml does come in very quickly and they do assist um very well in helping to restore but the ability for you to influx cash um to to set up temporary and potential services is always a benefit as opposed to waiting for your insurance company to cut a check it's not like they wait when when it's been when it's a total loss and it's very devastating they do come in quickly they do do a good job um and so i've seen it firsthand how they work for cities however comma um there's several other cities around us that are also a part of the risk pool when that happened in that that area was very isolated to that that one city in those few counties um but bowman put out the orange and then groves Typically when we get hit, they all get hit. They're also a part of the risk pool as well. So then it also has to spread those resources across. So the Golden Triangle as a whole would be also pulling on the resources of the risk pool in order to make that happen. They would all want their services restored. So then it becomes a queuing situation, right? How quickly can they process the claims? And they're an organization just like us where they have a limited amount of staff and resources as well.

Okay, thank you.

I would say also in addition to the insurance piece I know I wasn't here for the last couple storms but debris the debris contract is a really big upfront cost and we have an emergency contract but you know you need to get those folks out pretty quickly to start clearing the roads depending on the type of storm and damage that we have and that is usually a very significant cost so that.

you know insurance isn't going to cover and fema may not now either so that's another thing to consider and that that's something that i'm glad you said that not knowing if it'll even be recovered back that puts us in a very tough situation that's correct okay nothing else that's all we have okay

So at this point it's time to for a motion to for resolution receiving the proposed f four twenty seven budget and scheduling a public hearing. There we go.

Is there a motion. This is item two. Item two, yes, sir.

So moved. There is a motion and a second for item number two. Is there any further discussion? All those in favor, please signify by saying aye.

Aye.

Any opposed? The motion is carried. NOW, MR. CITY MANAGER, WOULD YOU TAKE US INTO THE READING OF ITEM NO.

Yes, sir. Item number one is to consider establishing and taking a record vote on the proposed 2026 tax rate and schedule a public hearing. Chapter 26 of the property tax code requires taxing units to comply with truth and taxation laws in adopting their tax rate and requires the governing body to hold a public hearing when the proposed tax rate exceeds the lower of the no new revenue or voter approval rate. Administration recommends Council establishing a proposed tax rate required to support the City Manager's proposed budget equal to a tax of $0.69500 per $100 of valuation. In accordance with Chapter 26 of the Property Tax Code, if the proposed rate exceeds the known revenue rate of 0.683976 per 100 or the voter approval rate of 0.764867 per 100 city council must take a record vote to place the proposal to adopt a rate not higher than the proposed rate on the agenda of the future meeting The no new revenue tax rate is the tax rate that would produce the same amount of taxes in FY27 as produced in FY26 if it applied to the same properties taxed in both years. The proposed tax rate of 0.69500 per $100 evaluation exceeds the no new tax revenue tax rate of 0.683976 per $100 by 0.011024 per $100 evaluation or 1.61%. If the motion passes, a public hearing must be scheduled. Administration recommends that a public hearing be held on September 8th at 1.30 p.m. in council chambers. City clerk will publish the notice of this meeting. Administration recommends approval.

All right. Is there a motion for item number one? There is a motion. Is there a second? is a motion in a second is there a discussion on item number one yes councilman crenshaw just for clarification in order for this to pass the 69 5 rate it requires five votes in september yes not today but in september we're not setting the tax rate this is we could go up to that amount but whatever ends up getting set we can go down this is the preliminary tax rate

You lost your money. At 69.5, and we do that. In order for this to pass at the September 8th hearing, it's going to take five votes.

September 22nd, yes, sir.

That's correct.

That's correct. Five affirmative votes to approve that rate.

Okay. So, but we could approve it today with only four?

Yes, sir.

It makes no sense, but okay. State law. I'm against it.

All right. Any other discussion? So this will be a record vote. So that just means that when I say who's for it, we'll just go down by it. Huh? She'll call. She'll call.

Mayor West.

For.

Mayor Pro Tem Crenshaw.

Against.

Council Member Turner. Against. Council Member Durio. For. Council Member Hilliard.

Against.

Council Member Williams.

Against.

And Council Member Sherwood.

OK, so now we're going to have to make another motion because we do need a. If we go to the point. 683976 will we still set a public hearing correct.

And I'm just clarifying, the no new revenue tax rate of point, I'm just going to say .683, that would require a public hearing? That's what I'm confirming right now. That's what I'm asking. Well, I don't think it does based upon how I just read this. But who's answering that? Nick also for clarification it can be let's just say does require a hearing in September it only requires four votes because it's. The no new revenue rate right.

Correct if you don't go above the revenue yes it's a simple majority.

See if you go to the new revenue rate then no no hearing is required.

So we can effectively do this today.

But at this point, we don't really have to take action on this because that was as much for the public hearing. That's what I'm trying to understand.

You still have to set your proposed rate, and you will still have to adopt that rate in September. We're only getting away from the hearing component of that.

So without a hearing and in order to approve this rate in September when we officially adopt it, it would only require a simple majority of four votes. Correct. Thank you so much.

We will need a new motion.

I'll make one. Okay. I make a motion to amend the proposed tax rate to the 0.675963. Second. There is a motion to, where is that amount?

Okay.

What you're going with is...

It's the current rate plus the... Plus what?

The voters approved in November.

Can you just say that? Just in case your number's off. Can you just make your motion? The current rate plus the...

I make a motion to change the tax rate to the current rate plus the addition of the voter approved GO debt.

Which would be .67695.

You're effectively going to be asking us to reduce the general fund expenses.

Just for clarity, and I think what they're trying to explain is that whatever you propose today is the amount that you're capped at. You can always lower it after your September 8th meeting, but you can never go higher than what you said. That's what they're making sure that you're aware of. I've got you. Okay.

yeah this is one of the options that we were given in our little option chart and it's the current rate plus the g o debt which the voters approved in november of twenty twenty five and that is point six seven six nine five yes and that is not the only debt that we have though there's additional debt so essentially we have three cents that is going to the is on that fund can only be spent on debt

that we've already issued.

So we're going to have to take two cents from our general fund, M&O operating expenses. We're going to have to move that to debt service, which means we are going to have less revenue in the coming year than we do in this year, which means...

Understood. Now, the graph that we saw where we saw that number with the proposed debt, was that correct?

The $0.03 that we were referring to of the INS includes the GO, which is the voters approved, includes the additional CO that you guys have already approved, and the tax note that's already been approved. So that will cover, which is the rate of 0.692, will cover, it'll keep the current M&O rate the same, and it'll increase that 3% for that additional debt.

And I understand that, but that's not what his motion is.

RIGHT. I WAS JUST MAKING SURE THAT YOU WERE CLEAR BECAUSE THE 676 IS JUST GOING TO BE THE CURRENT RATE PLUS JUST THE GEO DEBT. SO WHICH MEANS WE'LL STILL HAVE TO TAKE SOME M&O TO COVER THE OTHER ADDITIONAL DEBT BECAUSE WE STILL HAVE THE CO AND THE TAX NOTE THAT HAS TO BE It's already been approved. It has to be done. It's in the process.

Which goes to my earlier point that I would wish that we would have made a proposal on the current rate plus the geo debt to include what voters were told in November of 2025 when we said that it was the effective of $3.14 a month for a house of value of $150,000.

WELL, THAT WAS ONLY RELATED TO THE PROPOSITION.

I KNOW, BUT PEOPLE VOTED TO INCREASE THEIR PROPERTY TAX BILLS $3.14 A MONTH ON A $150,000 HOUSE. TO ME IT MAKES SENSE IF STAFF WOULD HAVE RECOMMENDED A RATE THAT REFLECTED WHAT THE VOTERS ALREADY APPROVED.

So what we recommended from the last work session was the current rate plus the additional debt that has already been approved, which is GOCO and tax note.

Completely understood, but I don't think that's his motion.

So just to be clear, just that way we have our INS covered because that has to be covered regardless. We don't have any control over that now. So just to be clear that that's going to take.

It's been approved by this council or prior. Can we bring up the, does the slide that has that amount have the correct reduction on it?

Yeah, I mean the slide, I think, Tina, if we can go back to the. I believe it's $2,096,000. The difference between the proposed rate of 695 and then I think what's being proposed now, which is the current rate plus the GEO debt, the difference is $2,096,765.

But that's debt that's already got to be paid. Where does the money come from?

Correct. It'll come out of our M&O.

It'll have to be carved out of the M&O.

If that looks like reduced services, if that looks like something else, I mean, that money's got to come from somewhere.

Understood. Right. So it'll be less than our M&O portion of our tax rate. It'll have to be moved over to the INS to cover that additional debt.

Getting there.

There was a second. There it is. So it's the point six seven six nine five.

Which is the current rate plus the geo debt right geo debt correct and then the six that point six nine two is the current rate plus to cover all of our additional debt which is the ceo geo in the tax. And that's the no new revenue that's the point six nine two.

okay gotcha all right but currently we have a uh motion in a second for the uh current rate plus the geo debt rather than saying the 0.67 i'm going on the second column is there any other other discussion we're going to do a record vote on that we will need to yeah great is there any other discussion From my perspective, before I know I have a perspective and I certainly understand what's being said, I think we're going to be also reducing our general fund to our operations to M&O because we're going to be paying some for certificate of obligations that we've already spent the money on. So that presents a problem for me. So that's not something I'm going to be able to support. Just as a point of reference. Understood. Any other comments? All right.

Record vote.

Record vote.

Mayor West.

I'm against that.

Mayor Pro Tem Crenshaw.

Approve.

Council Member Turner.

Against.

Council Member Durio.

Against.

Council Member Hilliard. Approve. Council Member Williams. For. And Council Member Sherwood.

Against.

Thank you. Okay.

So now we're moving on to another. We're going to need another motion because that one was, we've had two declined.

Someone needs to move for the no new revenue.

That would be my assumption, yes.

It won't be me.

rate would be all dead is that what we're trying to do. I don't know what you're trying to see is no new revenue.

What was proposed was the 23 adopted as it's written there correct. So we've got we've got 2 in there now we've got of the 4 the no new revenue number and the current rate plus all debt number. So

current rate plus the geo debt and the 2023 adopted which was proposed have both been denied and just to clarify if you did the current rate plus all debt it would require a public hearing and it would require five votes that's correct and what we're going to get the money for the rest of the day come out of operations yeah

So that's how we're going to cut the cut. That's going to basically be including cutting that 2% because they're going to have to use that to pay the debt.

That'll be something that they'll go back to and have to bring us. That's right. They would be in this case on the no new revenue trimming $1,214,200. What is that?

But it didn't cut in the 2%. It would be basically dipping deeper into the rainy day fund or our reserve. So instead of us being where I think we're going to be right at 20%.

Yeah, there's a graph for that.

What percentage are we at on the no new revenue rate? Are we at? Okay. And just for clarification, because we've never done this before, if we do approve that, do we then later have to vote to change the ordinance to where we don't go below the 20%?

No, so it's not an ordinance. It's a financial policy. So it's your policy that was adopted by resolution.

So we can just violate the policy and move on?

Council does a lot.

You can amend the policy as part of the adopted budget.

Ah, I like that. All right. You said we're going to have to get this money out the rainy day fund. I thought this whole plan was for us to stop taking money out the rainy day fund to pay our bills. So we're going to adopt something that makes us go into the rainy day fund to pay the bills.

The proposed budget is to only go into the rainy day fund $600,000 instead of $5 million this year. So again, if we go to this rate, we can, we'll sharpen our pencils and go back and try to find some additional savings. But potentially, you might have, you certainly could go further into the rainy day fund.

And this might also, if this means that we're having to sharpen our pencils, which could equate to deferring maintenance or, you know, not buying new fleet, things can break down, things happen, right?

Understood.

So that could end up opening doors to other repair expenses that we aren't planning on.

Understood. At this point, I'm waiting for a motion and a second.

For those of you who are keeping track, the only ones that have not been proposed are the current adopted, the no new revenue, the current plus all debt, The adopted in 2018 and the voter approval rate. So the proposed and the current plus GO have both been.

Current adopted doesn't include the bond election.

So the current adopted doesn't include, but I'm just saying what hasn't, a motion has already been made and failed on those other two.

We've rejected.

Those two.

Those two. I'm narrowing it down to the two between there.

Well, all of them are still at play.

That is true. That is true.

And I just wanted to say these are the scenarios we have given you but you don't have to pick these numbers if you wanted to go to a flat six nine that's between no new revenue and current rep rate plus all day you're certainly welcome to do that but a sick flat six time would also require a five votes yes sir it would anything about the no new revenue stone I mean let's just be realistic right I'm just I'm trying to.

Figure out something to get four votes and.

Y'all can mute your mic.

I want to know, why would you vote against the current rate plus the geodic? We've got to pay that. That's right there, that .6950.

You just voted against that. We just made a motion. No, I didn't. I just made a motion for it.

You made a motion on this.

And you voted against it.

And so did others. Or we can go in between those two.

COUNCILMAN WILLIAMS' MOTION WAS FOR THE CURRENT RATE PLUS THE G.O. DEBT, WHICH WAS .6769. THE OTHER ONE... WHICH WAS LOWER THAN THE... WHICH WAS LOWER. AND THEN THE CONCERN WAS IT DIDN'T COVER THE OTHER INS, WHICH WOULD BE INCLUDED IN THE CURRENT PLUS ALL DEBT.

SO THE G.O.

DEBT DOESN'T INCLUDE THE OTHER, THE C.O. DEBTS AND TAX NOTE DEBT, BUT THE ALL DEBT RATE DOES. THE CURRENT RATE PLUS ALL DEBT INCLUDES ALL. I WAS SAYING THAT THE GEO DEBT DOESN'T INCLUDE ALL DEBT. IT ONLY INCLUDES THE PENCILS THAT MUCH?

WE'LL TRY. I JUST DON'T LIKE THE WAY IT WAS PRESENTED, HONESTLY. IT'S CONFUSING. IT KIND OF SIMILAR TO WHAT COUNCILMEMBER CRENSHAW SAID EARLIER, JUST THE WAY IT WAS PRESENTED, I JUST DON'T FEEL COMFORTABLE.

NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS. NEW SPEAKERS.

NEW SPEAKERS. NEW SPEAKERS.

I just think for the record we the language didn't start out right and it created some theater and division drama all the things that Beaumont is known for but now that we're here I think we need to we've got to do this there's work that must be done but we didn't start out on a good foot with the language. What does that look like going forward? I don't know. Can this be tabled? Is that an option?

It takes you off your schedule. So if you wanted to table it, one that will put you behind on adopting your budget or we'd have to call special meetings because it does have to be posted for a certain amount of time. And to be clear, if you don't have an adopted budget in place before October 1, like many things, you shut down because you can't spend money if it's not approved.

Yeah. Yeah. All right. At this point, we'll go ahead and take a 10-minute recess.

we will uh we will resume and we have a new slide mr city manager so yeah this is an amendment of the earlier slide let's see the earlier was basically the base rate plus the voter approved prop a rate but that only covered a portion of the geo debt that's being issued currently this is amended to a different rate which is the current rate plus the entire voter approved prop a rate so that's reflected here

OKAY, SO WE HAVE A NEW OPTION ON THE TABLE FOR A MOTION. I'M GOING TO ALLOW SOME TIME TO REVIEW THAT, AND THEN I'LL BE LISTENING FOR A MOTION.

NEW SPEAKER AND JUST FOR CLARIFICATION, THE APPROXIMATE 1 MILLION IS NEGATIVE 1 MILLION.

NEW SPEAKER THAT'S CORRECT. so again the purpose of this slide was to show the variance between what was proposed and what would be the different rates that we're looking at but yes to your point it is a million dollar variance plus or minus and again if if this were to be approved then we'll we'll obviously refine this number but it would be approximately one million dollar variance from the proposed rate That's the whole answer.

IT THAT NEW ONE OF POINT SIX EIGHT SIX POINT FOUR THREE. THAT INCLUDE THE COLA. YES. THAT INCLUDE GOING UP ON THEIR INSURANCE RATES.

BUT AGAIN THIS IS THIS SLIDE IS JUST SHOWING THE VARIANCE FROM THE PROPOSED. SO HOW THAT SO HOW THAT'S LET'S LET'S ASSUME THIS RATE WERE APPROVED. as mentioned we still have a million dollars to find in order to get us to the point where. All things being equal we would only be dipping into the fund balance six hundred and sixteen thousand. Yes six hundred and seventy three thousand one hundred forty one. So the question how to do that would be reflected in the final watch it submitted.

and not to be disagreeable chris but actually it's going to be one point six million because your chart here counted the point six nine five twenty twenty three adopted rate would only be a six hundred thousand dollar deficit in twenty seven but the current rate plus voter approved prop a is an additional one million IN DEBT OR DEFICIT SPENDING FOR 2027. SO WHILE IT'S BETTER THAN WHAT WE HAD, IT'S STILL A $1.6 MILLION DEFICIT. CORRECT? THAT'S CORRECT. THAT WAY, YOU KNOW, when there's a vote everybody's clear uh and again i know we've had a long day and i hate to keep putting y'all on the spot what is our general fund going to be about if this passed i know uh at the no new revenue rate it was at 19 would this get us at our 20 no it's still going to be at 19. Still be at 19.

Even at the 0.695, we weren't going to be at 20. We were going to be at 19.85. 0.85. Yeah. We're going to be close.

AND WHILE WE'RE, I MEAN, I GUESS, ARE WE DISCUSSING? YES. It's unfortunate that we're in this position because voters in November of 25 approved a tax increase. The ballot was very clear. It says this is a tax increase in big, bold letters, which is required by state law for good reason. But in reality, it didn't increase taxes until city council came along and said, adopted the new rate and that's unfortunate because it's putting us in this position but at the same time voters approved it. And but it is confusing this is also the first time you know November twenty five is the first time the city of Beaumont had a bond election and what forty years and you know I was seven. I know that's hard to believe but anyway we're we're in this position voters approved prop a I think it's. It's almost unfair to then come along and have voters approve that and then us have to cut services because we're not going to increase the rate. And I hate that we only reached this option today. I wish we could have reached this option weeks ago because now it almost makes it look weird. THAT WE'RE COMING UP WITH THIS IN THIS MEETING. BUT IN REALITY, THIS IS A MORE ACCURATE REFLECTION OF WHAT HAPPENED IN NOVEMBER OF 2025. AND I'M NOT FAULTING STAFF FOR THAT. BUT IT'S JUST IT'S UNFORTUNATE BECAUSE I THINK THIS IS GOING TO CREATE SOME CONFUSION. BUT AT THE SAME TIME, THIS IS THIS ACCURATELY REFLECTS WHAT VOTERS APPROVED IN NOVEMBER OF LAST YEAR.

CAN I TAKE THAT AS A MOTION?

BUT I AM HUNGRY.

AT OUR LAST MEETING, THE BUDGET WORK, WHENEVER THAT WAS, YOU ASKED FOR OUR DIRECTION. AND YOU ASKED FOR WHERE WE STAND. WHAT RATE WE WANT TO GIVE YOU. AND THERE WERE THOSE OF US UP HERE THAT SAID WE DON'T WANT TO MOVE. AND THERE WERE OTHERS THAT SAID THEY DID. i've made a motion we voted on it i would implore those that that instructed the city manager and staff to move in a direction to to make a motion to reflect what you instructed them to do two weeks ago

I made a motion based off what I thought would be appropriate and right, which was the proposed budget, because we have a city manager and staff that made a recommendation based off the debt that voters approved and the bonds and the certificates of obligation that we have. And this is why I proposed that we go with what had been proposed and it didn't pass. So with that being said, in an effort of compromise, I'd be happy to support one of my colleagues that can come up to the numbers that cover our debts i don't want to hear any growling stomachs because people are eating next door they're just now letting them in

years.

Well, this is something we need to take action on. However, we can move ahead with item number three and come back to item number two. So why don't we do that? You're correct. Thank you. So we'll come back to item number one and then we'll go to item number three right now. If we could have the reading of item number three, Mr. City Manager.

sir item number three is to consider a resolution receiving the proposed 2027 capital program and scheduling a public hearing city charter and article 6 section 19 requires the city manager to submit a five-year capital program to the city council the proposed 2027 capital program was originally presented to council during a budget work session on may 18th excuse me may 14th 2026 article 6 section 20 the charter requires council to hold a public hearing on the proposed capital program And you should have a copy in front of you. And the administration recommends that a public hearing be held on September 8th, 2026 at 1.30 in the council chambers. The administration recommends approval.

All right. Is there a motion for item number three? There is a motion. Second. AND THERE IS A SECOND FOR ITEM NUMBER THREE. IS THERE ANY DISCUSSION?

NEW SPEAKER I HAVE SOME DISCUSSION. FOR THE PURPOSES OF THIS CAPITAL IMPROVEMENT PLAN, WHAT ARE WE ACTUALLY GOING TO DISCUSS? SOMETHING ABOUT SPENDING MONEY?

yes ma'am so this again is part of the budget process for the operations of the city this is the capital program which is a five year basically a plan to invest in facilities streets and drainage water and sewer parks and it is a five year plan because obviously these projects take time to come to a concept design funding and then construction and so THIS IS SOMETHING WE DO EVERY YEAR. AS MENTIONED, SOME OF THESE PROJECTS ARE UNDERWAY NOW. THOSE ARE MENTIONED IN PRIOR YEARS. SOME OF THOSE ARE FUTURE CONSIDERATION, BUT THIS PLAN CAN BE AMENDED EVERY BUDGET YEAR. BUT YES, IT IS TIED ULTIMATELY TO FUNDING.

NEW SPEAKER All right. WITH THAT, DO WE HAVE ANY OTHER QUESTIONS OR DISCUSSION? IF NOT, I WILL

all those in favor of approving item number three please signify by saying aye aye any opposed the motion carries mr city manager may we have the reading of item number four yes sir item number four is to consider resolution authorizing the city manager to accept maintenance and authorize final payments to eastex utility construction for the phelps road drainage improvement project On November 4, 2025, the City Council awarded a contract to Eastex Utility Construction of Beaumont in the amount of $1,080,289 for the Phelps Road Drainage Project. Previous change orders number one and two in the amount of negative $51,063.70 resulted in a final contract amount of $1,029,225.30. The project has been inspected by the Engineering Division and found to be in accordance with the provisions and terms set forth in the contract. Acceptance of maintenance and the final payment in the amount of $51,461.27 is recommended. Funds are available through certificate of obligation as well as CDBG funds under the 2019 hazard mitigation grant in the amount of $905,000. The administration recommends approval of this resolution.

Is there a motion for item number four? Move to approve. There is a motion and a second for approval of item number four. Is there any discussion? All those in favor of approving item number four, please signify by saying aye. Aye. Any opposed? The motion is carried. Item five has been pulled from today's agenda, so we'll move to item six. Yes. We may have the reading.

Okay. Item number six is to consider resolution authorizing the city manager to allocate additional local funds to the city's community development block grant disaster relief program contract number 24067018-E205 on July 26, 2022 by resolution of number Twenty two dash one eight two city council authorized interim city manager just met an application to the texas general land office for contract for the contract the phelps road drainage improvements contract under the cdbgdr program to address may major drainage improvements identified as being at risk due to tropical storm melda. THE TOTAL APPROVED PROJECT BUDGET WAS $1,055,479.65, CONSISTING $1 MILLION IN CDBG-DR, DISASTER RECOVERY GRANT FUNDS FOR CONSTRUCTION, ACQUISITION, AND PROFESSIONAL SERVICES, AND A REQUIRED CITY CASH MATCH OF $55,479.65 FOR CONSTRUCTION ACTIVITIES. OF THE GRANT FUNDING, $95,000 WAS BUDGETED FOR ADMINISTRATION AND ENVIRONMENTAL SERVICES AND $905,000 FOR CONSTRUCTION. Final construction contract amount including approved change orders total $1,029,225.30 combined with the $95,000 in grant funding for administration and environmental services The total project cost is $1,124,225.30. Accordingly, the city must allocate an additional $68,745.65 in local funds to cover the construction costs. Funding was available through COs in the amount of $124,225.30, as well as community development block grant funds under the 2019 Hazard Mitigation Program in the amount of $1 million.

the administration recommends approval of this resolution okay is there a motion for item number six it's a motion for approval is there a second there's a motion in a second for approval of item number six is there any discussion all those in favor of approving item number six please signify by saying aye Any opposed? The motion is carried. Mr. City Manager, may we have the reading of item number seven?

Sir, item number seven is council to consider granting a new solid waste franchise agreement to Nexus Disposal LLC. Nexus Disposal LLC has requested that the city council grant the company a franchise agreement. Founded in 2002, Nexus Disposal LLC is a family-owned and operated waste management company. Nexus disposal provides full service waste solutions to commercial industrial construction and community customers. The requested franchise is generally the same as those previously approved by the city council. It provides for a term of one year from its effective date and a franchise fee of seven percent of gross revenues received for service. It also requires that the entity to indemnify the city of Beaumont and provide insurance which names the city of Beaumont as a named insured. In accordance with the city charter, the franchise ordinance requires a reading at one city council meeting. The city ordinance does not take effect until 30 days after its adoption and approval by city council. After the passage of a franchise ordinance, the full text of such an ordinance shall be published on the city's website. Attached is a copy of the franchise ordinance for your review. AND AS MENTIONED, THEY'LL BE RESPONSIBLE FOR A 7% PAYMENT OF GROSS FEES TO THE CITY. THE ADMINISTRATION RECOMMENDS APPROVAL OF THE FRANCHISE.

NEW SPEAKER IS THERE A MOTION FOR ITEM NUMBER 7? does it need to be really reread or there is no motion. Yeah no we can have discussion right now yeah.

Me how many other hauling. Garbage franchisees do we have I know we have republic I know we have I'm assuming waste management we have twelve right now I twelve.

The most current list.

And do we have any idea about what those 12 generate for us a year in gross receipts?

$937,000 was last year. And so far this year, $905,000, $487.51. Well, good job having those numbers.

what is nexus here by chance they are.

Is it appropriate to ask questions if you please come to the microphone.

Thank you.

Sir hello where what other cities in texas do you operate in other than houston.

Houston in this area that's all we operate we're family business they've been around for twenty five years okay.

And do you plan on bringing your waste to our city landfill? Yes.

We're already in the area and we already bring waste to our landfill.

Okay. If you're already in the area, how are you operating if you don't have a franchise agreement? We're outside of the area. Oh, okay. So you're in the county, I guess? Yes, sir. Okay.

Like in Hardin County, Orange County.

Okay, and so the cities then that you service in addition to Houston is I guess orange and. Yes, sir, like needling grows, I mean we're and you already have franchise agreements with those cities so I don't have to have the areas I'm in right now okay okay so we're your second franchise agreement other than the city of Houston yes. They have like an application for this with like references and.

Yes, their application package is in your pocket.

My apologies. I've been in this industry in this area for 42 years.

And what is your title with them? I'm a manager. Okay. And will you be the manager for Beaumont? Yes. I actually worked for them 42 years ago. You like it there? Yes, I know them very well.

How many trucks are y'all planning on operating in our area?

Right now, we currently have three. And we're just doing our thing. We do roll off and we do commercial dumpsters.

Is it appropriate under these types of agreements to have any kind of upfront payment or anything like that?

I don't recall that ever happening.

Is that, do you know if that's appropriate?

That's not a part of how it's set up currently. It's just the seven.

That's not according, your ordinance doesn't allow for this. So franchise agreements are authorized by ordinance. Your current ordinance isn't authorized for that.

Understood. Just looking for an additional way to generate revenue since that's such a hot topic. What do you know about your current use of our landfill is? Do you have any idea just in general what you're spending with our landfill?

Well, we just started. So, I mean, I would think we go there probably 10 times a week. I don't know. Something like that. Just depends on what's going on. Because roll-off is done, you know, when they call in, then you pick them up and you take them to the landfill. It's not every day.

And do you have a certain customer or you just have broad customers or is there a certain plant here that you service?

You have to go out and call on them as soon as y'all say it's okay, then I'll go and work in Beaumont and do my thing.

Thank you very much.

Thank you.

Thank you for coming up. make a motion to approve there is a motion in a second for approval of item number seven any other discussion all those in favor please signify by saying aye aye any opposed motion carries mr city manager may we have the reading of item number eight

ITEM NUMBER EIGHT IS TO CONSIDER GRANTING A NEW SOLID WASTE FRANCHISE AGREEMENT TO LOCAL SOLUTIONS ENTERPRISES, INC., DOING BUSINESSES LOCAL SANITATION. PURSUANT TO CITY ORDINANCE 22.05.101, NO PERSON SHALL ENGAGE IN THE BUSINESS OF COLLECTING, HAULING OR TRANSPORTING IN THE CITY ANY GARBAGE, WASTE OR REFUSE Without first having obtained its franchise from the city, 12 entities currently have non-exclusive franchise agreements with the city and are doing business in the area. Local Solutions Inc. has requested that the city council grant the company such franchise agreement. Local Solutions Inc. is a privately held waste management company headquartered in Texas. According to the company's valuation summary they're privately held firm incorporated privately held firm incorporated on october twenty second twenty eighteen requested franchise is generally the same as those previously approved by the city council it provides for a term of one year from its effective date the franchise fee of seven percent of gross revenues received for the service it also requires the entity to identify the city of Beaumont provide insurance with names which names the city of Beaumont as a named insured. In accordance with the city charter, the franchise ordinance requires a reading at one council meeting. The ordinance does not take effect until 30 days after its adoption and approval by city council. After the passage of the franchise ordinance, the full text of the ordinance shall be published on the city website. attached is a copy of the franchise ordinance and agreement for you as you as well as application materials in your packet administration recommends approval.

Is there a motion for item number eight. Second there's a motion in the second for approval of item number eight any other discussion I'm sorry miss the second. Councilman Hilliard. Thank you.

I have one question. Yes, sir. Several percent of gross revenues, how much is that in dollars?

Depends on how much of a business they do.

How much was it last year?

Last year I think we had $900,000.

$937,000, $129.83. Okay. This year, so far, we're a little over $905,000. So that's for all 12 of those other companies?

Oh, that's for all of them, not just this one company. So it's going to depend on how much business they do. Okay.

All right.

Any other discussion? All those in favor, please signify by saying aye. Aye. Any opposed? That motion is carried. Would you please take us into the public hearing, Mr. City Manager?

Yes, sir. We have a public hearing council to conduct a public hearing finding and ratifying the determination of the public health director that public health nuisances exist on the property owned by Leduc Partnership Limited at 180 East Virginia Street with a legal description of Isentrout Lot 19, Block 1. order the owner to abate public health nuisances within 10 days staff is requesting City Council to abate said property without further notification to the property owner of city action City Council action and we have Kenneth Coleman as our public health director presenting good evening mayor council you know it's been a long day you can go to the next slide Tina

Just to give you a little history, this property was declared a public health nuisance on October 21st of 2025. And so when we first go out to the property, we give the property owner at least 10 days to bring the property up into compliance. And he did, but then the property was referred back to us for re-inspection on July the 23rd of 2026. Next slide. And what we initially found when we visited the property was stagnant and offensive water on the property, sewage overflow, conditions conducive to mosquito breeding, and rat-proofing structure. Now, since that time and now, the sewage has been corrected. That part has been fixed. Next slide. But we still, as you can see, we're still dealing with rodent infestation. Next slide. And as well as you can see some mold is building up and you know, mold can be very dangerous to people exposed to it for a period of time. And that again, that part has been corrected so far as the sewage overflow. Questions?

You did well enough that nobody's asking any questions.

Thank you, sir.

Yes, sir. So anybody else here to talk on public hearing?

Yes, sir. Did you open the public hearing?

I opened the public hearing.

You did. Okay. I didn't hear you. I was just making sure. I'm tired. Michael Ledoux, 4635 Littlefield Street, Beaumont, Texas.

Hello, Michael. It's been a long day, but I'm here for 180 East Virginia. Yes, sir. So we're talking about the sewer problem that he brought up right now. I think we were talking infrastructure. So the city I went by yesterday, the city is backed up. So a lot of times when it backs up, the city backs up. And I'm spending money all the time with a plumber to come clean it out. And he said, well, call the city because they're backed up right now. So I think right now you're doing Highland. You're doing on Highland Avenue. You're doing water infrastructure. Hopefully we have Virginia Street somewhere. WHERE THE INFRASTRUCTURE IN VIRGINIA WITH THE SEWER LINE IS BEING DONE. I HAD TO SPEND MONEY ON REDOING THE SEWER. I MEAN, NOT THE SEWER, BUT PUTTING A CLEAN OUT CLOSE TO THE CITY SO I COULD TELL WHEN YOU ALL BACKED UP AND THEN GIVE YOU ALL A CALL. BUT CONCERNING THE I THINK THAT WAS APARTMENT 3, WE HAD A LEAK FROM APARTMENT 6. THAT WAS FIXED LAST YEAR. THAT'S AN OLDER PHOTO FROM LAST YEAR. DO WE HAVE A DATE ON THAT PICTURE? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS? NEW SPEAKERS?

but they're never supposed to. So they would have 10 days. I can have that fixed quickly.

So if council authorizes this or declares this as a public nuisance, they have 10 days to come into compliance or begin the work to come into compliance. And after that, it becomes the health director's discretion whether or not to move forward with additional civil action.

OK, thank you. Do you have anything else? Any questions? Any questions? All right. Thank you. Thank you. So at this point, I will close the public hearing and may we have the reading of item number nine, please.

Yes, sir. Item number nine is to consider an ordinance finding and ratifying the determination of the public health director that public health nuisances exist on the property owned by Leduc Partnership Limited at 180 East Virginia Street with a legal description of Eisen Trout Lot 19 Block 1 and order the owner to abate public health nuisances within 10 days. Staff is requesting city council to abate said property without further notification to the property owner.

of city council action and the administration recommends approval of the ordinance is there a motion for item number nine move to approve second there's a motion and a second for approval of item number nine is there any discussion all those in favor of approval of item number nine please signify by saying aye aye any opposed motion does carry mr city manager

you please take us into the work session yes so this work session is um you may recall in the fy 26 budget council had authorized the expense expenditure of 25 000 to help fund a master plan for the botanical garden beaumont botanical garden And since that time, Beaumont Botanical Garden has approached us and requested that we amend that request to not essentially not be a master plan which shows the potential design or layout of the garden but rather they feel it's more important to develop a strategic plan for their organization and so given the degree of change I thought it best that we bring this item back for council guidance to see if indeed we want to move forward with expending the $25,000 for the strategic plan for the Beaumont Botanical Garden. And so I do think we do have some representatives here from the garden, Beaumont Botanical, I think Colleen, Colleen Martell.

Please. Yes, come on up.

Hi, how are you all? GOOD. A BIT OF AN EXPLANATION WOULD BE GREAT. I WAS GOING TO SAY GOOD AFTERNOON BUT GOOD EVENING AT THIS POINT. THANK YOU FOR GIVING ME A FEW MINUTES TODAY TO SPEAK ABOUT THE FUTURE OF THE BEAUMONT BOTANICAL GARDENS. ABOUT A YEAR AGO THE CITY SET ASIDE $25,000 FOR THE GARDENS TO DEVELOP A MASTER PLAN AND WE'RE INCREDIBLY GRATEFUL FOR THAT INVESTMENT AND WE HAVE TAKEN THE RESPONSIBILITY OF USING THOSE TAXPAYER DOLLARS VERY SERIOUSLY. As we began to look for a firm, we learned something important. A meaningful master plan for a property of our size and complexity, and one that specializes in botanic gardens, would realistically cost closer to $80,000 to $100,000. We ultimately felt that spending $25,000 to simply produce a document that didn't truly serve the gardens would not be a responsible use of public funds. Instead, we were encouraged to consider a strategic plan, and we believe this is actually what the gardens needs first. THE GARDENS HAVE BEEN PART OF BOMOT SINCE THE 1960s BUT THE NONPROFIT ORGANIZATION OPERATING THEM TODAY WAS ONLY ESTABLISHED IN 2022. I HAVE NOW SERVED AS THE EXECUTIVE DIRECTOR OF THE GARDENS FOR THREE YEARS AND I CAN TELL YOU FIRSTHAND THAT OUR GREATEST NEED IS NOT A PRETTY DRAWING OF WHAT THE PROPERTY COULD LOOK LIKE SOMEDAY. WE NEED DIRECTION, ALIGNMENT, A CLEAR IDENTITY AND MOST IMPORTANTLY A SUSTAINABLE FUNDRAISING STRATEGY. A MASTER PLAN TELLS US WHAT WE COULD BUILD. A STRATEGIC PLAN TELLS US HOW WE GET THERE AND HOW WE SUSTAIN IT. AND THERE'S A MUCH BIGGER OPPORTUNITY HERE THAN SIMPLY IMPROVING THE GARDENS FOR OUR LOCAL RESIDENTS. BOTANIC GARDENS ARE A TOURISM MARKET. A STUDY OF THE FORT WORTH BOTANIC GARDEN ESTIMATED THAT ITS VISITORS GENERATED MORE THAN $10 MILLION IN ANNUAL VISITOR SPENDING FOR THE LOCAL ECONOMY. AND THIS IS THE OPPORTUNITY I WANT BEAUMONT TO BE THINKING ABOUT. WE WANT TO OFFER OUR CITIZENS MORE EDUCATIONAL PROGRAMS, MORE EVENTS, MORE BEAUTIFUL SPACES AND MORE REASONS TO VISIT AND CONNECT WITH NATURE, BUT WE ALSO WANT PEOPLE FROM OUTSIDE BEAUMONT TO PUT THE BOTANICAL GARDENS ON THEIR LIST OF PLACES TO VISIT WHEN THEY COME TO SOUTHEAST TEXAS. WE DID SELECT A QUALIFIED FIRM TO DEVELOP THE STRATEGIC PLAN AND THEY WERE MOVING FORWARD WITH THE CITY ON THE CONTRACT WHEN THE PROCESS STALLED. WE LATER LEARNED THAT ALTHOUGH WE HAD DISCUSSED AND PURSUED THE CHANGE FROM A MASTER PLAN TO A STRATEGIC PLAN, THAT THE CHANGE HAD NEVER BEEN FORMALLY APPROVED. So today we're asking for council's blessing to use the $25,000 that was already allocated for the gardens for this strategic plan. We're doing the absolute best we can with the limited resources we have, but we need a roadmap. So my question to council is, what do you want the botanic gardens to become for the citizens of Beaumont? Because we believe this place has the potential to be more than a beautiful public space. It can be an educational resource, a community gathering place, a stronger nonprofit, and a tourism asset that brings people and their dollars to Beaumont. We believe the strategic plan is the responsible first step toward making that happen, and we are asking you to allow us to use the $25,000 already allocated for that purpose. Thank you.

Thank you. Anybody have any questions? Councilman Duria.

I don't know if I'll ask you or her. Can you explain exactly the relationship between the Botanical Gardens and the City of Beaumont?

THE BUILDINGS AND THE GROUNDS ARE OWNED BY THE CITY OF BEAUMONT, AND WE HAVE A MANAGEMENT AGREEMENT WITH THE CITY OF BEAUMONT. SO WE DO A LOT OF FUNDRAISING, WE HAVE OUR VENUE THAT WE RENT OUT, WHICH ACCOUNTS FOR ABOUT 50% OF OUR REVENUE, AND SO, I MEAN, WE PAY OUR STAFF, WE PAY FOR EVERY FLOWER THAT GOES IN THE GROUNDS, ALL THE SOILS, EVERYTHING WE GET A SMALL STIPEND FROM THE CITY MONTHLY AND I WOULD REALLY LOVE TO USE THIS STRATEGIC PLAN TO FURTHER EXPLORE OUR RELATIONSHIP WITH THE CITY OF BOMONT AND I WANT THE CITY TO BE INVOLVED IN THIS PROCESS WITH US.

NEW SPEAKER How much is the small stipend that you all get from the city?

NEW SPEAKER $1500 A MONTH.

NEW SPEAKER YOU PAY SALARIES WITH THAT?

IT JUST GOES TOWARDS OUR OPERATING FUNDS, SO YES.

YOU ALL HAVE A WONDERFUL ORGANIZATION. YOU DO A GREAT JOB. THE BAUMONT BOTANICAL GARDENS ARE BEAUTIFUL. I'VE BEEN TO EVENTS THERE. AND YOU DO A GREAT JOB. SO I REALLY APPRECIATE IT. AND I DON'T THINK WE'RE VOTING ON ANYTHING TODAY, RIGHT? BUT I'M IN FULL SUPPORT OF WHAT IT IS THAT YOU WANT TO DO. NEW SPEAKER THANK YOU.

NEW SPEAKER THANK YOU.

IS THERE MORE QUESTIONS?

I just wanted to call up Mr. Raggett and get his ideas on what's going on with the Botanical Garden. Or his views.

What would you like me to elaborate on?

Your ideas about the relationship between the Botanical Garden and the city of Beaumont. I mean, you with them.

I think we have a good working relationship now with facilities being part of parks. Like she said, we maintain the buildings and everything that's out there. Parks, we go out probably once a month at least and help out with maintenance inside of the park. We try to work together to get the gardens in the best shape that they can be.

You have input on that strategic plan?

I THINK WE'LL WORK TOGETHER, COLLABORATE WITH EACH OTHER. I'LL BE INVOLVED IN SOME TYPE OF WAY, BUT OF COURSE, COLLEEN RUNS THE POTANO GUARD. WE'RE THERE TO SUPPORT HER.

NEW SPEAKER I'VE BEEN OUT THERE AND WEEDED THE FLOWER GUARDS BEFORE.

NEW SPEAKER THANK YOU. So the idea is to get some direction, and I certainly don't have any problem with the redirecting of the funds.

Okay. No objections. We'll move forward.

All right. And with that, now we're going to move back to item number one. bring up that slide.

On discussion on this, I'm just going to ask counsel.

Why don't you all want to discuss this?

I mean, we have been, right now, I don't know.

I don't know where we are on this.

We're waiting on a, we need to, we need to approve a not to exceed amount. So, and then schedule the public hearing. And we're not setting it today, but we have to approve that in our schedule or we'd have to have another meeting. So, that is what we're doing right now.