City Commission - Regular Meeting

recording in progress

My head hit the pillow and I was out. I eat leftovers.

Huh?

Leftovers too. I did have to walk.

Are we on? Ready to go. Now we are. First and foremost, good morning, and I welcome everyone to the Wednesday, July 8th budget estimate review, our first opportunity to really get an understanding of what next year is going to look like. I want to thank the manager off the bat and his incredible staff for working on this over the last few months. I know it's been a roller coaster as a result of what we're potentially seeing in Tallahassee over the next year and a half, but I want to thank you and your staff and everyone who's here today who played an integral part in preparing this today. This is a process that will take a few months, and it's a process where we want some input and guidance from the community, both the business community and both our residents. There's many opportunities to engage. You can either write us an email, you can either come in person, or you can engage via Zoom in one form or another. But we're just grateful that we started this process and we look forward to putting together a budget that is, again, comprehensive and really addresses all our needs here in the city of Butteville as we continue to evolve on a daily basis. So thank you, Madam Director, in advance for all your hard work. The floor is yours.

Good morning, Paula Rodriguez, Deputy Finance Director. I'd like to echo the Mayor's sentiments and first of all thank the Mayor and the Commission, the City Manager and the Deputy City Manager and ACM for their guidance as we go through this process each year and set the priorities for what will be funded. I want to thank my staff because really they're the ones that make me look good. They do all the hard work behind the scenes and I want to thank all of the department directors and their staff because this really is a a collaborative effort, knowing that there was a lot of uncertainty as we came into this budget season. They really took the direction to heart and they all understood that this year would be a year where we would ask them to ask for what they need, but to please be conscientious of the uncertainty and to really keep it as minimal, as an efficient as possible. And they really did that. They really took that task to heart and they made our job much easier. I thank them all for their participation and their part in this. It's not something that I do alone. So today's meeting is the first budget presentation for the budget that was the July 1 budget that was presented to the commission and given to the city on July 1 as required by charter. Our end goal for today is to pass a resolution that will set the proposed millage rate and allow us to submit that rate to the county, and that is the rate that will go on your property tax bills, on the city's property tax bills. And so, as you know, this rate is the rate that will go on the bills, and to increase this rate would be a little bit difficult. So typically, this is the rate that ends up in our September budget. So thank you for your time on that. I'm going to go ahead and start the presentation, I know we were all here late last night, so I will. Try and be as brief as possible and so you're all familiar with our budget calendar, I am presenting I don't know if. They will TV, are you going off of my zoom or are you going off of the presentation on your screen. If you could share my zoom please. Thank you. So this is the budget calendar. As the mayor said, we start this process very early. We actually started earlier this year, knowing that we had a lot to think about. However, the dates on here start with our first conversations with the commission. And so in May, we bring to the commission conversations about our capital prioritizations. We meet with each one of you individually. And then on June 1, we received our property values, our preliminary property values from the property appraiser. With that, we prepared our July 1 estimate. On June 3, we had a budget workshop to review capital priorities. And those capital priorities are what are included in this July 1 budget to the extent that we were able to fund them. Luckily, we were able to fund most of them. July 1, we received revised budget estimate. I'm sorry. On July 1, we received revised property values. I will provide those numbers to you in just a moment. And we also submitted the budget estimate based on the June 1 property values to the commission. And here we are, July 8, having our budget presentation of the budget estimate. Throughout the summer, we will continue to refine revenues, primarily revenue estimates that we receive from state sharing funds, such as sales tax. And we will continue to look at other city revenues to make sure that our trends haven't changed from our July 1 estimate. On August 1, we're required to certify our tax rate, which is what we are setting today. And those documents will be sent to the property appraiser. September 15th will be our first budget hearing where we will adopt the budget on first hearing. And on September 29th will be the second budget hearing where we will have final adoption by ordinance of our budget. So our budget estimate. So this is a summary of our budget estimate. Our operating revenues are $299 million. That includes about $1.5 million of debt service. And in addition to that, we have transfers from reserve. And so this year, for fiscal year 27, we are bringing in just under 5.5 million from General Capital Improvement Fund, 7.8 from the General Fund, 586, 587,000 from Art and Public Places, 522,000 from the General Capital Impact Fee Fund, $2.8 million from the general fund building reserve. Fire inspections, we're bringing in $171,000 from the fire inspection reserve, primarily for capital items. For the country club, one of the fees that was implemented as part of the country club was a historic preservation fee. And so we have now collected about $197,000 from that fee, and we are reinvesting it back into the country club as in capital. Roadway Improvement Fund, we are bringing in $108,000 from their reserve. parking funds, $664,000, and stormwater utility fund, $815,000, for a total of $19.2 million. And so these funds that are brought into the reserve are generally used to fund one-time items. So we have agreed on a practice in the city that we use one-time money for one-time items. It is not our practice to use one-time funds to fund recurring funds. So our total budget is, our total revenue budget is $318,445,014. And so we have to have a balanced budget. Our expenditure budget this year is $252,277,167. Our capital budget this year is $51,066,090, and our debt service is $10,564,436 for a total of $313,907,693. are transfers to reserve. So funds that we anticipate transferring revenue over expenditure to certain funds at the end of the year. The city clerk's special revenue is estimated to have $9,833 transferred to reserve. The parking fund reserved for capital debt. This is the debt that we have been training the parking fund to absorb for mobility for the mobility hub, which you all voted on yesterday. And so we plan to transfer four point two million dollars at the end of next fiscal year for that debt. Sanitary sewer fund, $327,480 for a total of $4,537,321. And our total expenditures, as you can see, we have a balanced budget is $318,445,014. If there's no questions, I'll go to the next page. So the next slide is a breakdown of revenues by source. And so our intern very kindly presented partially this yesterday. And so you can see here that our revenue, and I thought it was important this year to show this slide, our revenues are primarily made up of property taxes. So this is our operating revenue of $297 million. Of that, 146 million comes from our property taxes, 49.2%. Our use charges, so charges such as VTRs and things of that nature are about $50.7 million. Other taxes are $28.7 million. Licenses and permits are $19.7 million. Other revenues are $21.3 million. Intergovernmental revenues are $9.6 million. This includes the state sales taxes, funds that we receive, for instance, from the JPA, the joint partnership agreement that you approved yesterday, those that we know are coming and we are able to budget for. Recreation fees are 11.7 million, and investment in earnings is about nine million. And so you can see a comparison from year to year of the percentage that those revenues play in our total operating revenue budget of $297 million. And you can see that it went up about $20 million this year. Expenditures by function. So similar slide that was shown yesterday, our expenditures by function are $313.9 million. And this is a breakdown of our expenditures by function is kind of a finance term, but I'll break down a couple of them. So public safety represents about 36.2% of our budget at 100 and just under $114 million. Physical environment primarily includes public works functions is about 18% at $57.4 million. Economic environment is $3.1 million. General government, so that includes most administrative departments, including the commissioner's office, is $70.5 million, 22% of our budget. Transportation, you can imagine that includes our roadways and the trolley service is about $29 million at 9% of our budget. And cultural recreation is $40 million, about 12.8% of our total operating budget of $313,907,693. You can see here that our total budget went up just slightly. I know we're talking about in millions, but from 309 million to 313 million. And so, in the spirit of keeping this budget as tight as possible and continuing to operate lean there's been much conversation about the number of positions that we add each year. This year, we are only adding one full time position and that position is being converted by the elimination of part time positions, a much needed position in our communications division.

Thank you very much. My pleasure. I'd just like to reiterate it and memorialize. I know that people don't like to go in the past, but I think it's important to understand what we did in the past so we don't make those mistakes moving forward. 2028, I'm pretty certain that this referendum will pass and you'll see many cities be in significant trouble. One of the things that we did here that I completely and utterly disagreed with, and I know the Vice Mayor also disagreed with, was in one year I think we brought in about 20 or so employees. Again, with all due respect to our employees, thank you for your hard work, but that is not the way to manage a budget, okay? The way to manage a budget in the private sector is you don't bring in 20 employees in one year unless you see a huge spike in revenue or clients, and you need to address those clients. We have the same amount of clients. We have 51,000 clients in the city. So we, I want to just go back and memorialize and put it on the record. How many employees did we hire under Amos Rojas here as city manager that one year?

I don't have that exact number.

My understanding was it's about 20 or so.

Yes. I don't have that exact number.

In that budget, in that budget, in that budget, in that budget, we advocated to be very fiscally sound, to not make that mistake. Besides the COLA, besides the raises through the commission, We're very clear. We're going to be paying for this for the next years because employees are here for 30 years, 25 years. These are positions that we are not eliminating. But as we now foresee what's going to happen in 2028, we have two albatrosses around our neck that would have given us a lot more, a lot more wiggle room in regards to how we're going to deal with this with a short with a short six or seven million dollars that we're talking about potentially from these taxes number one if we didn't have the cola we would have two million dollars less and i'll be contributing those two million dollars to your retirement instead of putting seven and a half million dollars additional gravy onto that onto that pension payment i would have put nine and a half million dollars that we did the year before and also an additional 20 employees everyone here understands it very clearly it's not just the salaries for those 20 employees It's the back and tail that comes with it. As you can see, our DCM, our ACM, and our manager are shaking their head because we have to make contributions to the pensions. We have healthcare obligations. By the way, healthcare went up this year, and correct me if I'm wrong, 23%. Am I correct or am I wrong?

Yes.

Okay. I just want to make sure because I'm going to say that I don't get my facts correct. So all of this has a compounding effect, especially when you're talking about union negotiations. I hate to sound like Jim Kaysen and Raul Valdez-Fauli and people who came before me, but they were very adamant about us being very careful and very thoughtful in how we conducted ourselves during budget season. This is an example of me sitting down with a manager and the DCM and the ACM and telling them, we have needs in certain areas, but we're not going to hire people. We're not going to do what we want to do because we have to be very careful and prepare ourselves with what's coming out in 2028. There was a Wall Street Journal article that came out today. I don't know if anybody was able to see it. And I would hope that you would be able to see it. You can look it up. And it talks about how cities are preparing for the 2028 referendums, the cuts they're going to be taking. When people talk about development and when people talk about issues about our downtown and the buildings, that is what, again, is minimizing the impact of this tax referendum that is forthcoming. Because, remember, commercial properties are not seeing the benefit of this reduction. So we have to always go back to the decisions that we made, which, again, will have implications forthcoming.

Mayor, I'm going to add another piece to that because this was part of the presentation that was done, what was it, two years ago now?

Yep.

In addition to the tail that you have as far as long-term expenses for moving part-time employees to full-time employees, you also lose out on the capital improvements. one-time expenditures that we could have done that would have paved more roads or fixed more potholes or fixed more drainage issues that we could have fixed with one-time expenditures move forward more historic preservation things of those nature because the more you increase your general budget with employees the less you're going to have to put into one-time expenditures of that nature so that is why i was you know preaching let's be careful how many people we move from part-time to full-time, because any time you do anything in a whiplash manner, there is going to be an aftershock from it. I sat down and spoke with some commissioners from other areas, and they're suffering far greater than we are because they don't have a central business district. They don't have the commercial properties to help shore up what's happening. And the need for a tax cut is there, because the dynamic that you're seeing in the residential community is that the young people can't afford to stay here. They're moving out of state. And the other end of that dynamic is when your family moves, and those families start to grow elsewhere, and you want to be with your grandchildren, then you also have your elderly population moving. So it hits both ends of the spectrum, and I don't think that's the vision that we want for our city or the vision that we want for our state. So that's why I've supported the tax reduction. It's going to hurt. We're going to have to adjust. We're going to have to recalibrate, but it's necessary.

And if you may, just before the end of the meeting, if you would clarify in the 2024 numbers, because I know that we also have police and fire increases, but I'm not adding those to that. Obviously, I'm talking about outside of those. I think if you include those, it was over 40 employees that we added in one year.

I can actually show you on the screen so the next slide is the one that's on the screen now and so that reflection is the change between 2024 and 2025 so as the mayor mentioned in police officers and in firefighters we added five that was the Second of three years of adding, I'm sorry, the last of three years of adding five positions. So not counting that in general employees, you see from 2024 to 2025, we went from 548 to 584. But from that 584, we have to remove the 20 that we added in building that came from the building revenue fund. And so when you remove that, the difference is 26. So 26 positions were added in that fiscal year.

So if you look at the last 13, 14 years that I've been here, we've never had a massive number like that. Again, I want to put it on the record because hopefully one day the future elected officials will call Billy and ask for a public records request from the clerk. And they'll say, hey, how did this happen? How did we make a $2 million COLA payment for the next 10 years, $20 million? How did we increase all these employees in one year? And the reason why I say that is because the manager will probably get a good laugh out of this because we've had many conversations about this. We always go back and try to find in the order of our pension payments where we missed a pension payment like 20 something years ago. Because we're trying to find out how we got into 50% funded like when I got here. And that's a number that was missing. And we always talk about that. How did that happen? How did that happen historically? I want to put it on the record and be very careful so that in the future, just because you have 40 plus employees in one year, again, I would love nothing more than to hire more people. Trust me, there's a need. There's a lot of different projects that I would love to tackle. Just to give you an idea, in my own office, we lowered salaries, I think, by $30,000 last year. So when you look at the numbers, that's where the proof is. The numbers is how much weight and how much tail do we have to deal with over the next few years. I know nobody wants to talk about that. That's not a pleasant conversation, just like the COLA. But at the end of the day, that is a trend that we need to keep an eye on because the more employees we add, the more stress we put on the system.

Yep.

Okay. So what I'm seeing here, difference from 2023 to 2024 is 22 employees. And from 2024 to 2025 is 46 employees. Can we shine a little more light on that?

My husband would tell you that we cannot do math without our Excel spreadsheet. So my staff is going to double check because there were changes to positions made in between. They're gonna double check that number and we're gonna come back to you and give you that number.

Okay, because that's a significant difference. Even if you tell me we hired 20 more employees, In the development services department, 20 employees, no matter what department it is or if it's restricted funds, it's 20 employees. So going back to what the mayor is saying, we're going to have to buckle our belts. But some of these decisions we made were not who you're blaming. I think it was partly you.

OK, so let's talk about that. But before you got here, we hadn't raised the amount of the firefighters advocated every month, every day for new positions. And we hired 15 new firefighters and 15 new police officers. What you see is an increase in those positions in regards to public safety, number one. Number two, in an effort to confuse You may not have your facts tree, but let me educate you and I'll have stuff and I'll have stuff education when you talk about the employees talk about the employees that were brought in in regards to the permitting department. Those employees are paid for from where Mister manager from the enterprise fund for the development services enterprise fund so those are not coming from the general fund. And why did we do that? We did that for two reasons. Number one, because we want to have world-class permitting, correct? Which is something you're very familiar with as a permit expediter. You want to have the best permitting department in South Florida so we will continue to invest. But it's not coming from the general fund. It's coming from the enterprise fund, which by state statute, Mr. Manager, and correct me if I'm wrong, you cannot spend that money from the enterprise fund. It has to be spent on the permitting department, correct?

Yes, it does, Mayor. It cannot go into the general fund. And I go into a general.

So at the end of the day, what I'm talking about is if we're making decisions outside of public safety and we're making decisions where there's an enterprise fund, I don't have a problem spending that money on those issues because you have a dedicated revenue stream. Just like, for example, you're spending money on a bond issuance or the mobility hub and you have a dedicated revenue stream, which is the money that's coming from parking revenue. But the problem here is the amount of employees that were brought in during Amos Rojas, which everyone has to admit was a catastrophe. And if you don't, then you got to get your eyes checked. But we should have never in our lives brought in the amount of employees that we brought in in that one year without a dedicated revenue stream. And what is that? The enterprise fund. So we can go back and forth and say that, but the facts are the facts. And, you know, I think it's pretty clear and the proof is in the numbers.

Through the mayor? Yeah. Yeah, I don't, I don't think you're understanding what's in front of your eyes right now. Let's go ahead and review the math a little bit just so you understand it, okay? There's a difference. In 2024, 22 employees. 2025, 46 extra employees. Explain that. Madam Director.

OK, I went back to the 25 budget book just to confirm, because sometimes changes happen in between. So in fiscal year 25, we added 26 positions to the total headcount, full-time positions. And so that included five police officers and five firefighters. So the total increase to headcount was 16. At the end of the fiscal year in 25, we added 20 positions to the building fund. The building fund is a proprietary fund that can only fund its services, right? The enforcement of the Florida building code. The only other funds that work in that nature are the sanitary sewer and the stormwater fund. Those are the only other funds that cannot really go between any other fund. And so the discussion is is that those positions did not affect any other decisions citywide as to what could be funded with those recurring revenues, I understand that, at the end of the day, the position count still went up by 46 but the conversation. of increasing headcount really revolves around how do we allocate those recurring funds, whether we increase the operating costs citywide or we are able to use that for other resources.

My point is that you increase employees by 16 that don't have a dedicated revenue source. If you look at the years prior, increase those two employees, three employees, one employee, it was never 16 in one year. At the end of the day, very simple. It's right there. The numbers are there. The director just explained it. Mr. Manager, you wanted to say something.

Yes, thank you, Mayor. We did add, at that time, 15 police officers for a downtown unit. The idea of a downtown unit was to be able to patrol the downtown without extracting people from the neighborhoods and thus providing a better service overall for the residents. We also had to add 15 firefighters because we added fire station four, and we have demand fire station four. So those two, the police and fire were added for enhanced services to our residents. And the 20 positions that were added to the building department come from the enterprise fund of the building department, which do not affect at all. And our general fund is that money is not added to the general fund and it's in a separate enterprise fund. that can only be used for enhancement of the building apartment.

Who dictates what it can be used for? The state. The state of Florida, correct? The state statute. And that is as a result of permit revenue, correct? That is correct, Mayor. I just want to be clear. This is what I'm telling you. There has to be a dedicated revenue source. If it's outside of public safety, I'd like to see a dedicated revenue source, which is something that I've always said. Case in point, the mobility hub, I think, is something important. So you have 16 employees that were added in one year. That will have an impact on the budget because again, additional salaries, additional implications in regards to the pension, the healthcare that goes up by 23% will have an additional cost in regards to the employees. You look at the breakdown year over year, let's just use 2013 when I started here. You look at the numbers, one employee, two employees is the maximum we added every single year. And we're very thoughtful and very careful how we curated that. We didn't jump up by 16 employees in one year. But any way you wanna skin it, any way you wanna hide it, any way you wanna play the game back and forth, we can play it all day, but the bottom line is that We never, and I'm going to ask Paula, Madam Director, have we ever added 16 employees in one year like we added last year?

No, not in the 10 years I've been here.

Okay, so it's very clear, very clear. I don't want to have this back and forth game anymore. That's the type of decisions that are detrimental to our budget. If you keep adding every single year 16 positions, 16 positions, 16 positions, you're going to hurt yourself because eventually you're going to have to, guess what, let go of positions if there's a downturn in revenue. That's what I've been telling you. Let's be very careful and be very thoughtful and not put ourselves behind the eight ball, okay?

Through the mayor. Paula, I want to go ahead and put this very clear, OK? 2024, it says 22. But let's go ahead and remove the five firefighters and the five police officers. And let's go ahead and remove the five firefighters for the following year and the firefighters. So let's subtract both of them by 10, because they seem to be the same, because that's what we're increasing, correct? If we remove 10 from 22, that's 12 employees, correct? Correct me if I'm wrong. I'm sorry, I'm not following your you're looking at 2022 2024 2024. I'm sorry, 2023 to 2024. From 2023 to 2024. You can simply look at the general employee column. And so in that year, other than police and fire, we went up from 536 to 548.

Through the mayor? Yes, sir. Commissioner, you have 102 to 948, that's 46 employees. That year we added five firefighters and five police officers, which is 36. which brings it down to 36. We added 20 positions to the development services or to the building department through the enterprise fund. That's 20. So 20 minus 36 is 16. So 16 is the amount of positions that were added.

And the year prior?

And the year prior, it was... 12. Yes, but five police officers and five firefighters.

Right. It was 22, right?

It's 22 minus 10 is 12. We're adding five firefighters and five police officers every year to get to... Correct. It was 15 firefighters and 15 police officers over a three-year period. We're adding five, five, and five.

I think we understand that that means both years, we have to subtract 10 from each year. Correct. Okay, so if it's 22 employees, in reality, it's 12, subtracting police and fire. And then in 2025, subtracting 10 is 16 employees, if you're subtracting the 20 you contracted for development services, am I correct?

for development services.

Okay, so that would equal 16. Is my math wrong Paula?

If we're talking about the difference from 24 to 25, the number that was added in 24 to 25, other than police and fire was 16. The number that was added from 23 to 24, other than police and fire was 12. I'm looking to the budget book to see what those 12 consisted of. In many cases, we converted part time positions. Let me just see if I can get to that so that I can bring to

I believe at that time, through the mayor, I believe at that time we added some additional code enforcement officers, which we were, we wanted to increase our code enforcement, and we did substantially increase code enforcement at the time.

So who pays for code enforcement? Where does it come from?

what we did in various of those positions, Mayor, we had code enforcement building department code enforcement. So more than half of those positions were through the Enterprise Fund.

That's my point. So we can keep going in circles and trying to one-up each other, but at the end of the day, I just want you to take ownership of last year's budget, which you voted in favor of. The Vice Mayor and I voted against it. So... You followed the recommendations of Amos Rojas, a person who led the city for one year and had never had the experience of leading this many amount of people that you see in this room. Imagine leading a thousand people in a city. So my point is that, This city, once I'm gone and whoever's left up here, will pay the consequences for adding 16 positions because you will feel the stress on the system as a result of the increases in healthcare, increases on the pension system. Let's pray to God that we continue to see an upswing like we've seen in regards to the stock market. So back and forth, we can keep going on this, but the numbers are the numbers, okay?

So two points of clarification. I don't want to belabor the conversation, but just so that it's clear for the record and for those that are watching. So also from 23 to 24, several of the positions that were added were in the building department at that time. We had just moved to the new system, and we had just moved to the new building. And so at that time, we added a mechanical inspector, a plumbing inspector, a building inspector, a building reviewer. I don't know if I said that already. And then although not a sworn position, we also converted two part-time background investigators and police to full-time because we were trying to address the recruitment issues that we had in that year. So other positions like the code enforcement that the manager mentioned and a position in stormwater, which is also self-funded.

So to make a long story short, she's mentioned about nine out of the 12. The two that were police, obviously, are public safety. They have to get funded. And there were requests, obviously, from the police chief. We can, in regards to public safety, we prioritize public safety. But as you can see, a majority of the positions, I would say 80% of the positions, probably led us to maybe two or three new positions were all from an enterprise fund. So, thank you very much for clarifying that. Commissioner.

I don't want to continue this conversation. We've been on this for 20 minutes, and we haven't made any progress. But an additional point of clarification, there were also parking-related positions, which are revenue-generating positions. The other issue we had was we were dealing with major issues in Public Works where trash pickup was not taking place because of lack of personnel in that department. Those issues have since been addressed. They're positions that at the time were deemed necessary. We can go back and forth on whether the city manager was a good city manager or not. He was the U.S. Marshal for the state of Florida. Highly recommended by the chair of the board of the University of Miami, was the first person to call me after we appointed him congratulating us for making an excellent decision on a new city manager. But, you know, we can be here all day. I think we should just move on.

First and foremost, I think putting it on the record and being very clear on the record, even though I know maybe someone like yourself doesn't want to put things on the record, I understand that and I agree because decisions were made that embarrass the city. By the end of the day, we're having a constructive conversation to be very clear. Outside of Steve Marin, who was the person that recommended this position to Ariel Fernandez, I don't know of anybody that called me and said that the smartest thing that we did was in the middle of a commission meeting, basically was hire a manager without even having a resume. I think that was probably one of the foolish and probably the most haphazardest thing we've ever seen here happen in the city of Coral Gables. Because nobody in their right mind would ever, would ever, ever, Whatever, in a large corporation, in the private sector, hire somebody off the street without even reviewing a resume or understanding who that person was. They would, at the end of the day, have a process, and that's what we called for. So I'm happy you brought that up because it gives me the opportunity to put that on the record. So Madam Director.

Thank you. I'm going to go to the next slide. So the next slide is one that was requested several years ago, and so we presented each year. This is a presentation of salaries for each department compared to their total expense and what percentage of their department is personnel cost. And so you can see here the list starting with the city commission. This would be the time for me to note that the city commission salaries increase each year by CPI. And so this year's CPI that's included in the July one estimate is just over 3%. This is based on the CPI that's available to us. We will refine that number sometime at the end of August when we get the CPI through July, which is the CPI that we base the budget on based on our code. And so you can see here that salaries are generally 80% of the operating budget. And just going down the line, overall, it is 63% of our department's budget, which makes sense because our city is a service city. And so in order to provide services, we require labor. It is also a testament that departments keep their budgets, their operating budgets very lean. And so we don't have a lot of extra funding within our operating budgets. You can see in departments like public works or in community recreation, the percentage of their salaries to their operating budget is a little bit lower because they carry a high operating cost, supplies, different machinery that they use in their service. And so that is the chart. If there's no questions, I'll go to the next slide. So we had this meeting on June 3rd. The next few slides are the capital funding that was included in this budget. As noted, for a total of, I'd have to remember what it was, $51 million. so i'll just go through the categories we've all heard these projects we presented them on june 3rd so the public was able to hear them as well if there's any specific questions i can go through them so 4.6 million in capital equipment just over 6 million for facility projects 9.3 million investment into historical facility projects 4 million, just over 4 million in the replacement and renewal of our motor vehicle fleet. Parking projects, just over a million dollars. Parks and recreations, this includes the country club, just under 5.3 million dollars. Public safety improvements, just under $2.6 million. Transportation and right of way, $10.8 million. This does include funding that we are receiving from the county. This does not include any of the appropriations that were recently approved by the governor. Those will be included in our September budget, and I can go through those. Utility repair improvements, $11.3 million. For a total capital budget of $55 million, $4 million of that is fleet replacement, which is actually in the operating budget. And as I mentioned, that does not include the appropriations that were recently approved by the governor. That will be included in our September estimate. And those include 900,000 for environment mediation of our debris site. $450,000 for gravity sanitary sewer pipe rehabilitation, $400,000 for traffic calming and safety improvements, $225,000 for the downtown drainage flood mitigation, and $225,000 for the Ponce corridor waterway flood mitigation, for a total of $2.2 million. You'll recall that a couple of items were not approved. I'm sorry, that is not what was included. Those are the items that were submitted. Sorry, I got thrown off a little bit with the prior discussion. I'm sorry, the traffic item was vetoed by the mayor, so the $400,000 for traffic calming was not approved. The waterway. And the downtown drainage and flood mitigation was not approved for 225,000.

If I may, maybe I misheard, the mayor doesn't have veto power here in the city of Coral Gables?

The governor.

Just want to make sure.

The governor.

That'll make it onto the blogs tomorrow.

Maybe I'm making predictions, the governor.

But by the way, like I mentioned yesterday at the end of the meeting, you know, we hit the highest numbers we've hit in three years, so that's a good point. And I want to congratulate our staff, like I said yesterday. Well done.

So my intern did not show up, but she did a great presentation yesterday. This was going to be her presentation slide. She was very instrumental in assisting us in preparing this presentation this year. She did an amazing job of learning about the millage and how that's calculated. So I am impressed by her ability to take on difficult information so quickly.

Through the mayor. Would it be possible when you bring this slide back up in September, could you break those, those columns up into what's municipal? What is a school board? And what is a county? I think it's important for residents to realize that's not just us, and how much the schools and the county get from their taxes. And what a small portion really, the municipal tax levy is on on the residents.

We will try to do that. We do have two slides from now. We do have an example of that for our city. So I will show that. So as you can see here, this is a comparison of all Miami-Dade County cities and their total millage to the city of Coral Gables. Last year, we were 12th lowest. This year, We are 10th lowest. This is the adopted millage for the current fiscal year. We will update this next year with what's adopted this year. And so you can see that Key Biscayne continues to remain the lowest millage of the full-service cities, providing police and fire services. We are second to the full-service cities. So the full-service cities are highlighted in blue. Surfside, Miami Beach. I'm sorry, that's wrong. You have Miami Beach and Miami and Hialeah. And we still continue to be second in that list. The next slide is going to provide you a comparison of just the city millage for those full service cities. And so Coral Gables Millage, the millage that we are proposing today is 5.559 for the 12th consecutive year. The estimated city portion of property taxes for the average homesteaded value of $1,012,564 would be $5,629. If a resident was to have that same property in the city of Miami whose millage is 7.3616, that estimate would be just over $7,400, an increase of $1,800 to our city's millage. Miami Beach, their operating millage is 6.113 or their city millage is 6.113. Their estimated property tax for the same average value in the city of Coral Gables would be just over $6,200, $582 over our residents. In Hialeah, the millage rate, the city millage rate is 6.3018. The average property value on the city of Coral Gables would pay just over $6,300 for $752 difference to city of Coral Gables residents. And in Key Biscayne, their millage rate is 2.8846.

there the same value would pay two thousand nine hundred dollars just under three thousand dollars for a difference of two thousand seven hundred and eight dollars less than the city of coral gables to the mayor um question of these other cities that you're doing a comparative do any of them um i'm going to use the word subsidize although it's probably not correct the garbage fee or is it billed separately total

So I believe, I know for a fact that Miami Beach bills separately. I believe Key Biscayne also pays separately. I'm not familiar with Hialeah's practice, and I believe Miami also has a separate solid waste fee. I don't know if they subsidize it, we can find that out for you, or if they bill the total cost.

But if you were going to actually compare apples to apples, you would have to have an effective millage rate based upon the amount of subsidy that we do provide for residential properties here. Right, so 5.5590 is not actually what they're charged based upon the amount of subsidy.

Yeah, to that point as well, there are cities that have voted debt. We don't we have chosen not to have voted debt. So there are cities that have a separate debt debt service millage, and they fund capital with a separate millage. So there are several comparisons that we would need to make to make it apples to apples, but certainly the subsidy of solid waste, and whether they fully cover that would be a good comparison as well. So we can I can find that out for you and bring that to you.

Yes, I think it's important because sometimes residents don't understand that some of the fees that are charged by other cities explain why their millage rate is lower.

There are other factors like their pension liability and things of that nature too. Of course. That is a good point. If there's no other questions, I'll go to the next slide. This slide provides a view of the Coral Gables properties by type. And so we've mentioned this in the conversation about the vote for the homestead, the change to the homestead. 54.1 of our properties continue to be homesteaded residential. So that's a significant amount of our property tax revenue. 31.8 is non-homesteaded residential, and then 8.7 is commercial, and 5.4 is all others. You'll notice a small decrease in homesteaded residential, but I believe it's offset by that non-homesteaded residential slight increase, and so probably there are new residents and It'll turn over next year when they are eligible for homestead exemption. So this is an important factor to consider when we're considering the vote that's going to that's going to our residents to increase the homestead exemption from 50,000 to 150,000 and 250,000 in the subsequent year. We've talked a little bit about it. We're not focusing on it in this presentation because it will not affect this budget, although we are considering it as we plan this budget. We're estimating a decrease in property tax revenue of about $5.7 million next year and almost double that for $11.4 million in the subsequent year. We have begun speaking internally, and I know that we've spoken with some of you about the different approaches that we will look at to be able to I'm not going to say absorb, but to be able to weather that and to change the way we do things. And so we will continue to have conversations internally and with each of you as we approach next fiscal year's budget. But I imagine that our budget process will look a little bit different and we'll be bringing to you our ideas of how we'll address those decreases in revenue. um like in this particular budget and i didn't talk about it in the capital section we made sure which is a practice that we started several years ago but particularly in 2023 with the guy with the um the guidance of the city manager's office and this commission of taking recurring revenue and putting it into capital because we know that that recurring revenue is being used now for one-time items. And so those one-time items could, and I'm going to use the word very lightly, easily be removed, right? So for instance, in this budget cycle, um i know that about 6.3 million dollars of projects are one time are really one time in nature for instance the alhambra water tower alone is almost 1.8 1.75 million dollars so that will not be a reoccurring cost in our capital next year and we can count on it to help balance our operating budget if we need to there will There will be subsequent capital needs that we'll need to fund, but we know that at least it's almost like a safekeeping that we are using recurring funds for one-time items. I don't believe that we will be able to remove all of the 6.3 million, but in the effort of impacting services as little as possible for our residents while having a balanced approach to funding capital, I think that we will be able to come up with a good plan of how to get there and not completely impact all of our services. While it is not something that I'm advocating for, but it's still ways for us to consider how to get there.

Mr. Manager, I know this may not be the right or appropriate time to discuss this, but I'm going to take the opportunity that we're in the sunshine here with my colleagues. I'm going to be calling for in the next commission meeting, I'm going to be requesting to put it on the agenda. After I speak with you, I haven't had a chance to even speak to you with it and get your guidance on it. I'd like to build a blue ribbon panel with each member of the commission, along with the manager, city attorney, city clerk, having a member who is well versed in finance, person who represents the community, to really digest and work with staff, to review, and yourself, to review our budget. And let me tell you why I think it's a good idea. I think it's a good idea because it will allow this Blue Ribbon Panel to start just like we did, what we do every 10 years now, not every eight, every 10 years, with our charter review. The charter's pretty simple if you look at it. But what I think the charter review process really delivers is engaging in the public, making the public understand the process, and being very transparent, having multiple meetings, engaging, getting public input. I think that the Blue Room panel would serve as an opportunity to start educating a lot of the residents who are highly educated, who are very affluent, a very highly educated community, but to engage them in the conversation of where there may be possible cuts. And what are the ramifications from year one to year two, as you've seen, $5.7 to $12 million. So I'd like to see if there's an appetite for that. I'm going to bring it up in the next commission meeting so that we can have real conversations, have people really digest, really delve into the budget. And we can have public meetings, maybe two or three public meetings so we can have conversations and we can talk about simple things like, We continue to fund something that we started eight years ago, which is the sea level rise initiative for $4 million a year. Do we continue to, you know, what are conversations? I don't even want to bring up certain things here because before you know it, there'll be an article on it tomorrow. You know, I'm against, you know, garbage pickup in the rear or the trash pits or anything. That's not what we're talking about. Trying to find ways to balance the budget. without affecting services, continuing that. But if we cut from capital, we're cutting our nose in spite of our face. We have to be very careful. Just like what we did when we accepted the COLA and we cut our nose in spite of our face. Because what we did was, instead of keeping it at a $9.5 million payment, and I know nobody likes to hear that, but I'd like to repeat it over and over again so people understand it to never make that mistake again. Now we're making a $7.5 million payment. Do not vote for it. You should worry about yourself. It's very easy to point fingers. The funny thing is you sent out an email. You interrupted me. You recognized me. No, I did not. You did. You pointed at me. I run the meeting. I run the meeting. I know who I recognize. Trust me. Okay. You should worry about yourself. That's why it's very clear. You should worry about yourself. Did I mention your name? I didn't mention your name. I didn't. You did in an email. I didn't mention it today. So stop living in the past. Okay? So my point is, stop interrupting me, Commissioner. Control yourself. You're very, very concerned about Robert's rules and all kinds of things, but you seem to not know how the meeting gets run. Okay? So let me explain to you once again. When you cut $2 million from a COLA, which is a very simple thing to do, you only extend the payback period. My goal was whoever is left after I'm gone is that you would have $25 million at your disposal that you wouldn't have to use to pay down the unfunded. So that's why we tighten our belts and we make tough decisions. And we don't do the simple things that generate votes. We make the tough decisions that make sure that we shore up the ship and it continues to sail moving forward. So at the end of the day, I think that putting together a Blue Ribbon Panel to discuss every out would engage the community and allow them to say, hey, listen, I think we should spend $4 million on CELA rights. OK, then where are we going to cut the money from? Because if we cut capital, you're going to be cutting what you're spending on to make sure that your historical projects continue to be top class? What are we going to spend in regards to pickleball courts and tennis courts and, you know, the youth center, which we're not spending money on that right now, but there's a litany of different things that require attention. So it's going to be a very tough process. And we can take the money from areas that seem very, very simple because they may seem benign. Oh, we'll just cut from the unfunded liability a million dollars a year. You're only hurting yourself by doing that. You understand? But we have to be very, very careful. One of the things that it pains me to say it, like I've said before, one of the few items, the only item that I have on the agenda, excuse me, on the budget, which I've advocated every single year as my only pet project, is the $500,000 that we've had for land acquisition. We have always cut that, and I've been the first one to say cut it. I think one of the things we're going to have to face is the $4 million because it's a big lump sum amount for sea level rise. We have a significant amount of money in that account. How much do we have already in that account?

32 million.

32 million dollars. Again, I know that we can't use that money because it's an enterprise fund, correct?

Yes.

But maybe we don't fund that anymore, and that gets us by 70% of the way.

I know. Mayor?

Yes.

Of course, there's going to be a lot of diversity of opinion. There's going to be a lot of diversity of opinion on all these issues. So the membership on this particular committee might need to be a lot broader than just, you know, you might want to take your current folks that are serving on the budget board and have additional folks appointed or from each discipline. so that it can have a robust discussion on, yeah, where do we make these cuts?

And I welcome that feedback. Again, at the end of the day, it's going to be something that's going to be this commission's responsibility. And if you read that Wall Street Journal article that came out, you can see that people are bracing. And we're blessed, like the vice mayor said, of our central business district. But if we didn't have a central business district, you have some cities that, in that article, they're talking about 30%, 40% cuts in their budget. And that would be a tsunami in this community.

Hello, Mayor. Yes, sir. We've been fortunate that we've run a very lean operation for a long time. We expect the $5.7 million to go in 28, another $5.7 million to go in 29, a total of $11.4 million. We've already had a number of scenarios that we've been looking at to see where this funding can take place. It's also going to be a function of what our property values are at that time also. So there's a lot of variables here that we have. I think a committee would be very good to, so that we can have resident input into what we do. Our feeling is cut services, do not cut services. Do not cut services, do not cut capital. And I think that with various scenarios that we have, I think we can get that done. It's going to take other things. We've subsidized trash for a lot of money, almost $9 million. So should we continue subsidizing at that level? You mentioned the fund, the sea level rise fund. That's $4 million. So we have a lot of areas that we can look at that are nice to have, but do we really need three? We subsidized trash by $3.6 million a couple of years ago, so that's quite a bit of money also. So I think there's a lot of scenarios that we need to look at, and there's a lot of variables that are going to take place. We've already looked at various scenarios. In this particular budget, we have a lean budget. We've asked our directors to be as lean as possible, trying to get ready for what we believe is coming, which is $5.7 million reduction in our funding. And I want to be clear, Mr.

Manager, on that point. I have full faith and confidence in our finance team. I tell them every single day, I'm with your office. But I think this is an opportunity just to get people to really understand, to really engage, because they're going to go out and vote. Maybe we use it as a tool to explain, hey, where are you going to cast that vote? I'm not saying you to vote one way or another. I believe there should be tax cuts, especially for those who have been retired and been paying their homes for so many years. Retirees in this community deserve a tax cut. We'll firmly say that over and over again. also think that people who are first-time homebuyers deserve a tax cut so they can afford to live in this community for a certain amount of time maybe four or five years but that's not the conversation today i think the purpose of of that of that of the blue ribbon committee or whatever the committee is is just to educate and say listen this is what's coming because i don't think people really they read it but they don't understand the implications in their own city so through the mayor yep and i just

One of the purposes of the reduction in the garbage fee was to help those out who needed help the most. It was a way of giving a reduction in taxes that didn't help the wealthy the most, but helped those who were struggling the most. So one of the things I'd like the committee to look at and I'd like our staff to look at is, is there a way to gear the garbage fee to where there's an application process or we mirror what the county's doing to give a reduction to those who need it the most, those who are struggling, those who are under a certain income level, whether it's $50,000 or another number. that can be debated amongst the committee members as the appropriate level at which the subsidies should apply. You do an application. You have a sworn affidavit that under penalty of perjury, you only receive this much income. So that's something I think that we could do and help fill some of the gap that we're going to be facing.

So we can certainly look at that option. I've taken a note of that so that we can consider it in that process. And I appreciate the mayor's and the commission's openness to looking at various ideas, because that is exactly the approach that the manager and staff has talked about, is that this is not you know it would be easy to say cut all of it from one area or just cut a bunch of positions or just cut a service and that's not the approach that we're looking at and I agree that engagement with our citizens and with the Commission on the decisions that are made to get there will be a vital part of this process because at the end of the day this is your city this is their city and so whatever services they pay for is um is really their is really based on their input right so we represent you all represent the city and what they want and what they are willing to pay for what they're willing to what they what they expect from from our from their government and so i appreciate the mayor's suggestion to engage the citizens because i think that is going to be a big part of making these decisions for them as to what will continue to operate, what will get cut, what might get refined. And the more people that we have engaged in that conversation and the more input, I think the better of a plan we're going to come out with.

Mr. Mayor? Yes, sir. Yeah, so I love this idea, you know, as a general concept. I'm not just, we're not going to have the conversation or the debate today regarding it, but I'm not particularly in favor of a Blue Ribbon Committee for the sake of just being inclusive and larger, right? you know, then I think we're yielding too much to potentially too many differing voices, right? What I liked is the way that the mayor had teed it up first, right? He first made a reference to the Charter Review Committee. Now you're referring to a form of like a blue ribbon committee akin to the Charter Review Committee comprised of individuals who have a particular expertise in finance. NOW, I REITERATE, WE HAVE BAR NONE THE FINEST FINANCE TEAM IN THE LAND. YOU ALL ARE FANTASTIC. BUT HAVING REPRESENTATIVES WHO ARE RESIDENTS OF THE CITY VOLUNTEERING THEIR EXPERTISE BUT DIVERSE ENOUGH, IN MY VIEW, DIVERSE ENOUGH TO REPRESENT AT LEAST APPOINTEES AKIN TO THE CRC FROM THE COMMISSION and the city manager and the city attorney so that we can maybe have, I'm just suggesting maybe a version of the CRC in terms of number and representative. At least the focus should be there because they've been selected for this type of a blue ribbon committee. We have town halls, we have these budget meetings that the, and we can see we have a very full group today here. I think there's ample opportunity for the residents to provide their thoughts, their views. Each of us holds, well, we have office hours, but I think a Blue Ribbon Committee laser-focused on people who bring that particular expertise is what I'm more in favor of, not over-inclusive. Through the mayor?

Yes, sir. I actually, I think there could be a fusion between both ideas. I do like the vice mayor's concept of having different opinions on specific areas, because there are projects that maybe those who are in finance don't really understand. But maybe there's a way to have a specific meeting where you can have a representative of each of our advisory boards that would have an area of expertise and they can be present for any questions that this blue ribbon panel would have. And you're right, I think if you expand it too much, it becomes extremely difficult for it to accomplish its goal. And really, as the mayor said, the goal would be the finance of the city. So it should be individuals who are experts in that area who could really give the commission some sound advice, but open it up for them to have the right people in the room to answer questions that they may have.

Like Commissioner Lata said, again, we're not going to figure this out today. I just brought it up for my colleagues to think about it. The clerk reminded me correctly that we have a budget review committee, which at the end of the day, we could use those individuals who, again, give up their time already in regards to the city. But the intent of whatever is the will of the commission, I'm more than willing to do. I just think that everyone should have person named to that committee, that it should be based around again, budget and the forthcoming tax implications. My only intent, we'll bring it over the next Commission meeting. And we'll have a conversation and we'll make a decision on that point. Thank you, Madam Director.

My screen, please. Thank you. And so this I went ahead and I went to the next slide. This slide is the same information just represented in dollars. So this is property tax revenue by property type. And so you can see that approximately set just under $72 million comes from our homestead residential currently in the in this fiscal year budget 37.5 from non homesteaded 25.5 from commercial and 11.8 from all others. This actually represents the updated property values generating $146 million in property tax revenue. Our June 1 Estimate, I'm sorry, our July 1 property values. However, the budget estimate is based on the June 1 value. So this is slightly different than what's in your book, but it's the updated information. So not a huge increase from the values that we received on June 1 to July 1. This is property, same information, property tax revenue by property type. This is just depicted in a pie chart. And then this is the slide that we were referring to, tends to be a favorite discussion item because it is very representative of what goes on with our property tax revenue. And so as the mayor has highlighted each year and as Commissioner Fernandez mentioned today, um your the um property taxes paid by the city of coral gables residents does not all go to the city of coral gables and so that is a concept that many people don't know and so this pie chart reflects for you based on just the city's millage of 5.559 which is what we set today for the proposed millage to go on the tax bill, the city receives 31 cents per tax dollar of the taxes that our residents pay. And this is based on the average homesteaded taxable value. Dade County receives 30 cents per tax dollar. regional which is primarily the state receives just two cents per tax dollar paid by our residents and the school board actually receives 37 cents per tax dollar so you can see very clearly here how the how the property taxes are divvied up from the different organizations it does not all go to the city of coral gables however i believe that our residents would agree that the majority of their services are provided by the city of coral gables

SO THIS IS WHY I WOULD LIKE TO SEE IT ON THE OTHER ONE SO IT CAN BE COMPARED AND PERHAPS ON THAT ONE, THE VICE MAYOR WAS MENTIONING ABOUT THE GARBAGE FEE, MAYBE YOU CAN, MAYBE AN INTERN CAN TAKE ON THIS PROJECT, BUT ADDING revenue from different fees in other municipalities as well, because we may end up being number one for all we know, because others may have additional fees that are making up the difference of what they're not collecting on the millage. So we can have a real accurate example of how much revenue is coming in from those additional fees that in our case, as the Vice Mayor was mentioning, we're covering that from the general fund.

So we will try and make that adjustment to that table. My only concern as I think about it is that table is very busy already, so it may become, but we'll see if there's a clean way for us to highlight.

Make it top 15. We don't have to go all the municipalities, but it'll show us where we are in those top ones.

And then just the comparison of the fees, we will, we will see, we will take a look at that. Many cities have different types of fees. So we'll, it gets a little bit tricky. And it's almost like, you know, in other areas, but we'll, we'll try and come up with a common list of fees and see if we can gather that information before the September hearing. Okay, so we're almost done. I think I have three slides left. So this is the annual pension contribution. So this chart shows you each year the fluctuation between the annual required contribution to pension, the extra pension payment, and the payment to FRS and 401. And so as you can see here, in 2027, the budget is $24.9 million for the required payment, slightly less than last year's required payment. We all know the reason that last year increased substantially was because of the retiree COLA. Also because of some new items to union agreements and some usual pension changes. For instance, the funding of the lowering of the assumption rate. And so this year it has slightly gone down. This year we are also able to increase the extra payment amount to $8.6 million, still almost $1 million less than in 2025. In 2026 we did have to decrease it because of that COLA, the approval of the COLA for the retirees. But this year, each year we apply a 1.25% increase to how much we fund towards pension. And so partially because of that we were able to fund an additional amount to the extra pension payment. And then you can see that our FRS 401 payments slightly decreased from last year. However, not too much. And you can see that the participation in the plan has increased every year since 2019, which helps to lower our pension contributions. So this slide is same plan, different information. So this is the funding ratio of our pension plan year over year. And so for fiscal year 27, is this right? This chart doesn't look right. It's projecting 76% funded. Is the information right? I'm sorry, this is for the 25 year. So this is for fiscal year 27. We will be funded at 76.2% and 23.8%. This is just based on the actual actuarial year. Thank you. And so the general fund reserve analysis, and so we have a policy of funding 25% of our total operating budget. And so at the end of fiscal year 25, we are funding the requirement for the 26 budget, and we will be funded at $64 million. And so each year that increases as our budget increases because we are trying to fund at least three months of operating expenses in order to be able to recover after a major catastrophe. And so that is the funding ratio for each year.

I'm sorry, Paula. Would you mind, if you can recall, go back to the previous slide, the funding of the pension plan, the annual pension contributions? A couple of slides back.

One more.

Where it goes through 2027, right? Yes. So based on what our investment managers are predicting and projecting, and given if we maintain contributions where we're making the extra payment, can you tell us a couple of things, like number one, when is it estimated then there will be fully funding?

I'm going to defer to our finance director, Diana Gomez.

Sure. So at the last meeting that we had with the pension board and the joint meeting, they did present that information. And if the actual investment returns on the market value of assets meets the required rate that we currently have, which is 6.95%, the plan is expected to become pretty much 100% funded by, or it says 98% funded by 10-131 and over 100% by 10-132. So by 10-131, we will be essentially fully funded.

Okay, so that's if everything holds, right? We certainly can't predict with a crystal ball, but these are some of the smartest people in the room. That's what they're giving us, as I would say, a reasonable or conservative estimate, right? So towards the end of 2031, right? Correct. So what impact would that have then on our available funds, having been relieved of having to make the extra payment, can you just kind of, this is for, you know, the residents to get a sense of like, when you tighten your belt, you make those extra payments, you hope for the best, you plan for the worst. What is the pot of gold if there is at the end of that rainbow?

Sure. The normal cost of the plan is the cost to fund the everyday plan benefits, assuming no unfunded liability is about $6.5 million. So, and that changes every year depending on benefits provided and things like that. So let's, if we argue based on the last report it's about $6.5 million, then the difference from the total amount of payments that we made, so at this, you know, somewhere around $24 million would be available for other uses once we have no other unfunded liability.

Well, that's a remarkable number.

Yes.

Almost $25 million. Yes. That we don't have now, but we will have available if we maintain the sort of fiscal responsible way of handling the unfunded liability. Am I right?

That is correct.

So, think about it. You know, think about what we can do for the city with that additional money that we don't have now. and in light of the rather drastic and material changes that are going to be coming our way with respect to revenue we depend on based on property taxes. Thank you.

Thank you. So the reserve slide is my last slide. Um, so the item that is before you today is to pass a resolution, um, authorizing, uh, the city manager and staff to submit the millage rate of 5.559, which is 6.9. or 6.94% above the rollback millage of 5.1982. So for those who are not familiar, the rollback millage rate would be the millage rate that would generate approximately the same amount of revenue as we are generating this fiscal year in next fiscal year. So 5.1982 is that rollback rate. The rollback rate that we are proposing is the same, is maintaining the 5.559, which allows us to fund the budget estimate proposed to you today, which is 6.94% above the rollback rate.

Mr. Manager, do you have any further comments or anything you'd like to address in regards to the estimated budget?

I would like to say this is about the 12th year that we've maintained this same 5.559%. Two years prior to that, we were higher, actually, when you were here, and you actually lowered the millage rate. So we are the poster child for fiscal responsibility according to what the state tells us. However, we have been caught in this wash of tax reduction because of various other factors. counties and municipalities, but I do believe that the fact that we're going with our 12th year with the same millage rate and the fact that we have a very sound budget, a very sound city, I believe this is a good budget and I certainly recommend acceptance.

Great, thank you. Through the Mayor. Madam Vice Mayor. My trip's this year and I made, I think, three? Chelsea would remember better than I would how many troops we made in Tallahassee. What I heard from our elected leaders in Tallahassee is they were very pleased with the city of Coral Gables. They were not upset by our millage rate. What they were upset at were other cities that raised their millage rate, other cities that were doing things like had happened in our city in the past where there's raises for elected officials where there's, you know, our allowances and other expenditures that they felt were excessive and not in service of the residents. So I'm confident that adopting this millage rate is in keeping with what our leaders in Tallahassee would be happy with. And our efforts to tighten our belt on excess expenditures is exactly what they want to see other cities doing. And we are setting the example for sure.

Through the mayor? Yes.

I proposed something last year.

It was the 0.25 for consecutive years. I'm not going to be proposing that this year, but I am going to be proposing at least some reduction. Something that's not going to affect the budget much, but showing a point that, hey, we care, okay? This homestead exemption, it's not going to take effect right now. It's going to take time. And I think right now, We can share or show the people that we actually care now. We increased by 46 employees compared to last year. And the numbers don't lie. They're here. My question is, who pays the pension fund for the building employees?

The pension fund does. The building fund does. The building fund does.

OK. That's good.

All the costs that are borne by each of the proprietary funds are proportionately charged to them. So sanitary sewer and stormwater also pay their proportionate cost of the pension fund.

OK. And then the other thing that I also want to mention, the mayor keeps on talking about this COLA and keeps on pointing fingers. But from what I can remember, to accept this COLA, we needed four votes, didn't we? We did, right? Correct? Yes. OK. And who are the four people that voted for this COLA?

As I recall, the only one who didn't vote would be the mayor.

So you're trying to tell me the Vice Mayor Anderson voted for this COLA? I voted for this COLA. I voted for this COLA. Commissioner Menendez voted for this COLA. And Commissioner Ariel Fernandez voted for this COLA.

So just keep in mind that when you're talking about the COLA,

You're also talking about the vice mayor and it's not to say anything negative because I stand by our decision. Some people here don't run businesses, even though they say they run businesses or they say they are, and they actually get fired embarrassing. Okay. But for a person that does run a business, retention is very important. especially for public safety. So when you raise a COLA, it was a very smart decision at that point when we had more than 30 vacancies in public safety. That's taking care of the safety of this community. So when you keep on bringing COLA and COLA and trying to point fingers because we took $2 million from an extra payment to fund the pension, think about what you're talking about a little more, okay? Because the safety of this community is the most important thing.

Madam finance director, may I ask you a quick question? What was the recommendation?

At the time of the recommendation?

What was the recommendation through the manager in regards to the COLA?

So the recommendation of the finance director, because that's one part of the hearing that we have, is my recommendation was to not grant the COLA based on the factors that were identified in that memo from the time.

Thank you very much. Second, I did not vote for that column. I stand and I vote for that column. It was the smartest move, and now you're seeing the repercussions. It only hurt the employees, the current employees. Let me explain to you why, because the commissioner fails to either understand or he prefers to, I hope she understands it, but she maybe prefers to not say the whole truth. instead of attacking me about some ridiculousness, which is true. Really quick. In regards to the cola, when we granted that cola, who benefited from that cola? Did the current employees benefit from that cola? No, retirees.

Mr. Mayor, if I may, it's a subset of retirees. It's not all the retirees.

I'm getting there. I'm getting there. You're jumping the gun. Sorry, Mayor. You're stealing my thunder. Let's just pump the brakes. Not attack people personally. Let's attack the issues. Right? I'm not here attacking anybody personally. Again, We're talking issues here. Very proud to have voted for that COLA. It was a huge mistake that staff even said not to vote for. But all of you that are employees did not benefit from that COLA. Am I correct? Yes or no?

That is correct.

Okay.

Now, let's say, hey, maybe all our past employees benefit from that COLA. Is that true? All our past employees benefit from that COLA?

No.

If I may recall, it was about 700 or so individuals, correct?

It's about correct. I'm trying to pull it up, but it's a subset of the total roughly 900-some retirees.

That word, that this was derived from a settlement proceeding, correct?

Yes. Okay.

This code is going to cost the city $20 million for the next 10 years. Let me be clear. These are individuals that I'm grateful that they work for the city. but they're receiving their retirement, and many of them are also receiving Social Security. And many of them receive 175 money and 185 money and drop money to the tune of millions of dollars. Some firefighters, as I wrote in my letter, as Mr. David Perez, who's sitting in the back, can tell you, leave the city with $1.5 million in cash and their average of $77,000 a year. So we pay our employees handsomely for the work that they do. If you look at the firefighters, so I like to use them as an example, they average $117,000 average pay here. They have the best facilities in Miami-Dade County, if not the state of Florida, all brand new facilities. And when I got here, Mr. Perez walked me through our facilities and I made a commitment that I would renovate or build new facilities.

And I kept my promise.

What I won't do is jeopardize the future of the city by granting exorbitant COLAs or granting exorbitant pension contracts, which we've done in the past. So at the end of the day, the reason why I select to point the finger at Commissioner Castro is she's running for reelection. And I'm being very candid. And the people who are voting in this community need to understand. She didn't support an IG. She voted for a $2 million cola. She gave herself a personal 101% raise. She gave herself a car allowance. She gave herself an expense account. She voted in opposition of a November election. Over and over and over and over again, we can continue talking about this. At one point, we even had conversations about spending our reserves, dipping into our reserves, which is absolutely Reckless, just like accepting a COLA. So without, we're talking facts here. We're not talking about personal matters here. No need to bring personal issues.

Mayor.

Yes, Madam Vice Mayor.

So if we're going to recount what happened during that COLA meeting accurately. Commissioner Castro was pushing for an 8% COLA. How much was that stripped from our budget?

It would have been roughly a $27 million, maybe a little bit more, about $3.5 million payment every year over 10 years.

It would have been devastating, wouldn't it? Okay. Mr. Castro, I'm going to give you the following suggestion. Reducing the millage rate helps the rich the most. Working out something with staff to where there can be an application procedure for reduction in garbage fees going forward, because it's not going to be this year, is the best way to help those who are struggling. And that's ultimately what we're trying to do, is help those who are struggling, who have difficulty paying. for these fees. It's going to give more tax relief to those who are struggling than any tweaking of the military ever could do. That's where you can help people the most. The other sounds sexy, but it doesn't deliver.

Through the mayor?

Yes.

Well, since we are talking about running for reelection, yes, I am running for reelection, but that's not something we should be talking about. But let's go ahead and talk about it just a tad bit. Are you not running for reelection? You don't have to answer. Of course he is. So let's be a little transparent here. Yesterday, we were voting on a development. We'll be voting on a UN. Let me just tell you, UN, gave the mayor's PAC $25,000. That crystal development project, which is the crystal developer, gave the mayor $10,000 the day after qualification. Let's go a little further. There's a project coming in Merrick Park from a Brazilian developer who also gave the mayor $25,000. So let's just be a little more transparent. These are projects, ladies and gentlemen, that we are voting on right now. The mayor's running for reelection. How does that look?

Thank you very much. I appreciate that. Would my colleagues in the commission like to say anything else that is good for the order here?

Yes, Mr. Mayor. I actually have a question. So we take three votes on the millage rate, correct? We take one today, and then we take two in September. Is that how it is?

So this is the one that the proposed millage rate that will be sent to the property appraiser, and this is the one that will go on the trim notice. And then there will be two budget hearings in September where the tentative millage will be approved at the first, and then obviously you finally approve at the second budget hearing.

I just want a clarification on that.

Right, so the millage that's voted on today, in order to increase it after it goes on the tax bill, requires additional noticing and would essentially probably cost the city more than we would lose reducing the millage.

And then we vote on the budget In September, in the two readings? Yes. All right, perfect. All right, thank you.

Commissioner Lala, anything for the good of the order before we take on this resolution? I also have a question for the city attorney. Is it a quasi-judicial proceeding when we're convening to discuss matters involving, for example, Crystal Project?

The Crystal Project involved quasi-judicial items. The pad and yes, and the site plan is a quasi-judicial.

So I don't know if... And the zoning changes. If you as the city attorney should caution anybody on the dais when they're expressing a personal opinion, prejudging, I would say, the issue by saying that if entities associated with the Crystal Project are making donations to a PAC that that is considered by that commissioner to be an expression of prejudging issues sitting in a quasi-judicial capacity that could give rise to recusal. I don't know if that's something that you think you would need to caution people from revealing that you consider making a contribution, a material, having a material impact prior to the, the continued hearings on these matters.

So as a general matter, of course, each of you has to make a determination that you are, you know, and that you are free from bias and you can be impartial in determining or considering a quasi-judicial matter. And of course, that matter is not here before us today, so we should not be discussing that matter.

No, I could not agree with you more. That's why I'm mentioning that there may be cause to caution It's the city attorney. Maybe even to caution Commissioners from expressing a clear bias from my cheap seats here Clear bias that the Commissioner Castro is against the crystal project For the reason she just stated here on the record For the mayor, I think the honey, but if you may I'd like to hear from the city attorney I

So again, as I've you know, instructed each of you in the past when we consider the quasi digital matters, it is up to each of you to make sure that you can be remain free from bias and consider the application before you impartially and based on the evidence in the hearings that that that occur. A public a properly notice meeting.

For the mayor, yes, commissioner ladder. If there was any bias here, it would be through the mayor that's getting funded by developers, not by the person that is reading something that is a public record. It's information that everybody has access to. So if there's a bias here, number one, you get to decide for yourself if it's a bias. But if there was a bias, I would say it would be the mayor's bias. He would be biased.

Through the mayor? Yes. I disagree. It's not for you to decide or any one of us decide whether or not a bias exists. The record speaks for itself. And I would not want you and my recommendation to the city attorney is to avoid leading you into clear error before the next meeting. Because to me, when you said what you said clearly on the record, expresses clear bias. If it were up to me, I would say you need to recuse yourself. I don't even know how you could possibly walk back your statements unless you're not being honest or genuine. So anyway, just trying to keep an eye out for you and for the rest of my colleagues on the dais.

Thank you. So just two quick points. Number one, the reason why I didn't respond to the commissioner is because, again, You're treading on some very thin ice there, and I want to avoid that conversation here in the public because I think there's no place for that, number one. Number two, Madam City Attorney, does accepting any contribution admit a bias?

It does not constitute a voting conflict. The bias question is always up to each of you in the quasi-judicial matters, but there's no financial voting conflict.

I bring that up because I always like to hear from the professionals in regards to these matters. Because at the end of the day, it's been the same tactics for the last three and a half years. Slander, destroy, and a lacking zero facts issues not leading. But at the end of the day, we have a resolution here of the City Commission that, Madam City Attorney, will you read into the record, please, so we can vote?

Yes, sir, of course. It's a resolution of the City Commission setting the proposed operating millage rate of 5.559 for the fiscal year 2026 to 2027 to be submitted to the Miami-Dade County Property Appraiser in the form required by Section 200.065 Florida Statutes.

I'll move it. May I have a second, please? I'll second. Mr. Clerk, do we have any public comment?

No, Mr. Mayor.

We'll close with public comment. I was hoping that, if I may, before we take a vote on this, I was hoping that our next meetings that we could have some public comment. I'd like to see the public, especially the residential and commercial areas, especially the commercial areas, because we always have the residents who come here, but we don't really have commercial areas. They're gonna play such a major role in how our budget develops, especially with these tax, Referendums that are forthcoming. I'd like to see the downtown especially as we embark on certain pieces of legislation and Projects that we've been working on for such a long time one of those being the cleanliness project that we're gonna be bringing forward that currently is being reviewed by the manager and the procurement team also some of the amazing projects that we've been working on for over 10 years. For example, the medians on A Street, excuse me, not A Street, A Street and Ponce. We've been talking about that for years. And every time that I talk to the business community, they're super excited. So we're investing in our downtown. We're making sure we added those additional police officers, 15. We're really focusing on public safety in the downtown and not robbing to pay Peter, Paul. Because at the end of the day, we were having issues. If there was an issue in the downtown, we were asking the police officers to come from the residential neighborhoods. Now we have a dedicated police force just in the downtown. So I'd like to hear, because these are major decisions that we're making, and I'd like to hear from, at a minute in the chamber, should be here, And I'd also like to hear from some of the business owners, especially business owners on Miracle Mile, business owners on Hidalgo, business owners in the Central Business District. I'd like to hear from you because you're going to be carrying a lot of the weight in these budgets, not only here locally, but throughout the state as we see some serious tax changes coming in 2028 and 2029. So, Mr. Clerk, can we have a vote?

Vice Mayor Anderson? Yes. Commissioner Castro?

I'll be voting yes, but I'm also putting on the record my plan is to make this a little lower.

Commissioner Fernandez?

Yes.

Commissioner Lara?

I echo the Mayor's observations of the importance and the need, I would say, to have not only more residents come speak during the budget meeting, but we really need to see the commercial Business operators in the city appear because not only are they important in any given year since they are vital to the tax base and the continued Success of the city whether you live or you work or both here or you visit Now, given the changes that we think are going to be coming down from Tallahassee affecting our property tax revenue, they are most important during these conversations involving the budget. So I agree with you, Mayor, that we hope to hear more from them since they play an increasingly vital role. So my vote is yes.

And at that point, something that we mentioned, uh, yesterday in the commission meeting, I brought up to the manager this morning. I went early in the morning around 5 o'clock. I took those pictures for you. Laura in my office is working on putting together the memo. I'm gonna send it to the commissioner. So you can see, and I got actually, it was very fortunate to actually see waste management. in the process of opening the door so i took pictures as they were rolling out the can so you can see how the actual structures look inside and again i bring that up now because these are simple things that could play a significant beautification role maintenance role in the downtown which again as revenues become tighter as revenues become tighter and less this could be an opportunity for more beautification and it could be something so simple that pays huge dividends so my vote is yes to adopt the millage Moving forward is there anything else before we adjourn anything else?

No, sir. Thank you

OK, well, I'd like to thank staff for this first of three meetings. Thank you for your hard work. Thank you for putting together this budget estimate. We're beyond grateful for all your hard work. And we're looking forward to the next few months. And hopefully, in the next meeting, we'll have a better turnout in regards to the public. And maybe, Mr. Manager, through your leadership, we can work with Martha Pantin to maybe put something out there so we can engage more of the community.

We will do that, Mayor.

May I have a motion to adjourn? I have a motion we have a second. All in favor aye. Meeting adjourned.