City Council - Regular Meeting

Hi, Jennifer. Let's test your audio.

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Yep, we can hear you.

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Good afternoon and welcome to the May 20th, 2026 City Council work session. Thank you for joining us in this hybrid meeting format today. For work sessions like this one, there is no opportunity for public comment. Those wishing to access the meeting can do so by watching the live stream available on our website, the broadcast on Comcast Channel 21, or by calling into one of the phone numbers listed for this meeting on the public webcast and meetings materials page of the City of Eugene website. Thank you all again for joining us. And I now call the May 20th 2026 work session of the Eugene City Council to order. And I will turn it right over to our city manager to introduce the first topic, which is a work session on long range financial planning, looking at financial policies and service frameworks.

Thank you, Mayor. As you know, this is a second informational work session that's going to lead up to your two-day long-range financial planning workshop, which is scheduled at the end of June. Tonight, you'll receive information on the city's fiscal policies from staff and an overview of a service framework structure consideration tool, which is really helpful in the budget development process and also when you're looking at service delivery. And as a reminder, the city is using Raftelis, a consultant firm who's going to be guiding us through that conversation tonight around service framework and also being a support to us in the long-range financial planning discussion and facilitating your June workshop. Thank you.

Thank you. Good afternoon, Mayor and Councilors. I'm Twyla Miller, your Chief Financial Officer. And we have a gift for you today from our team. So you have binders in front of you for this process. The materials from the last meeting and your slide deck and the AIS for today are here. And each week, each time we come, we'll bring more materials for you. So you have everything in one place as we work through the workshop and then also financial policies in the fall. So today we're going to have a overview, again, of the long-range financial planning process and as well as discussion on financial policies and the service framework. And the REF TELUS team is here with us virtually and they will be presenting the service framework overview portion of the presentation. So today's objectives really are to provide an overview and have common understanding of these elements of long-range financial planning, and then also a chance for you to identify information you need as you think about moving forward with your workshop topics that will come in June. So just a recap of some of the concepts we presented last week. So this is our timeline. This is your second informational session on financial policies and service framework. Maurizio and I will be back on June 8th to give a financial condition overview. This will include topics on the general fund, distressed funds, our limited duration funding such as community safety payroll tax, and unfunded needs considerations as we look to the future. Then again, a recap of the phases of this process. So as we discussed last week, we are in phase one. Again, getting that common understanding of the elements, including a high level review of our financial policies to provide information for you to use in your workshop in June. This will help provide the information needed to develop a service framework and align the strategic plan. Council providing policy direction on the service framework and strategic plan alignment. We'll give direction to the city manager and staff as budget development begins later this summer. In phase two, we will have a deeper dive on revising our financial policies, and this will include convening the budget committee to receive revised financial policy considerations, to have a discussion, receive public comment. as well as city council adopting the financial revised policies before your winter break. Sorry, I'm clicking too fast, there we go. Phase three, let's talk about phase three before we move forward. So phase three really, again, is our traditional process as shown on the slide. This includes the capital improvement program and related topics coming to the budget committee and council in February of March of this timeframe. This does show the traditional process. One of the staff will be working to develop a community engagement process in relation to the 2027-2029 budget strategies as we enter the new calendar year. So the activities to the right of this slide may look slightly different as we develop that process and more information will come.

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And then again, this is just a reminder of all of the elements of long-range financial planning that we talked about last week. These are all things that we're already doing, of course, in the organization, but this foundational framework is really transitioning to a longer-range thinking to provide resiliency and flexibility as we look to the future so that we have fiscal stability as we kind of operate in a changing world. Next, we'll talk more about financial policies. So you saw this slide last week. Financial policies provide a critical framework that provides financial management and guides financial management of the organization and our decision making. Council's role is to provide a high level policy direction and to adopt the policy framework. Financial policies are a foundational framework that generally don't change a lot between cycles, but should be updated as needed as structure changes to reflect new information and incorporate best practices. So this graphic shows the history of our financial policies at the City of Eugene. The first iteration was adopted in 1983. The current iteration of policies were adopted in 1996 and has been revised a few times since that time. Other than the unappropriated ending fund balance, or UEFB policy, which we added in 1997, and updates to our debt issuance guidelines, the policy revisions since 1996 have not been material. They're mostly language updates for clarification or in response to legislative changes or best practices. The last revision occurred in 2007 and the last budget committee review occurred in 2013. So it's been some time since we've taken a close look at our financial policies as a body. Our use of financial policies has been more internally focused with these policies embedded in our financial structure and processes that we use across our organization. The goal with the new long range financial planning process is to have a regular review cycle with council and the budget committee and to be intentional about highlighting policies where appropriate as part of council discussions and related actions.

I'm not seeing this in the packet.

Oh, it's under the date for the current date. There should be a slide deck if you look to the tab.

On 520, which is the second tab.

I got it. I'm just behind.

No worries. Thank you. Okay, so this slide is showing the major categories of our financial policy, our financial policies. These are found in our budget document and are also in your agenda item summary as attachment A. So within each of these categories, there's a range of policies. I'm not gonna talk through all of them, but I'll hit a couple highlights in each category. So with resource planning and allocation, this includes city council goals and policies, as well as service priorities. Accounting and financial practices includes financial systems, fund management, as well as policies on reserves and marginal beginning working capital. Revenue and collection includes policies in relation to general fund revenue diversification, serial tax levies, using one-time funding for limited duration services. Capital improvement policies include policies on our capital improvement planning, bonds, and the city's physical assets. And debt and investment management includes policies on our bond rating, debt issuance, and investments. I will note that our debt issuance guidelines are part of our financial policies. Our investment policies are referred to in our financial policies, but they're actually a separate policy outside of the policy document, and it does come to council. Your last review was this last winter when we made some changes. Next, we have organizational policies, and these include policies on organizational structure, service levels, and performance standards, and market-based employee compensation. Other policies include compliance with state and federal requirements, appointment of the budget committee, and supplemental budget direction. So staff have been conducting a comprehensive review of policies, including looking at best practices, consulting with our financial advisor on debt issuance guidelines, reviewing financial policies from other jurisdictions, and consulting with organizational partners. And to date, we've identified potential updates in the following areas shown on the slide. So the first is A4, which is service priorities, and I'll touch upon that in the next slide. The second area is policy B11, and this is marginal beginning working capital. As currently written, the highest priorities for marginal beginning working capital are general capital projects, UEFB, or unappropriated ending fund balance, and general fund contingency. Marginal beginning working capital is recognized on the first supplemental budget of the biennium, where we true up the actual ending capital from the prior budget period to what was estimated when the budget was created. In the last budget cycle, we included ongoing funding for the general capital transfer. So that's part of the ongoing base budget and would not need an allocation for marginal beginning working capital at current levels. So this language should be revisited. The next category is category E, which is our debt issuance guidelines, and these should be updated to reflect current practices and standards. And then we have other current policies. And this is recognizing that as you have your discussions this summer, there may be other specific policies you would like staff to bring more information back to you on, in addition to the updates we're already planning to bring to you. So these can be identified as you go through your workshop this summer. And then there are a number of general administrative updates, including the changing to a biennial budget, statutory changes, other name changes, and adding references to many of our city documents. And then the final category is a consideration of adding new policies that meet best practices. GFOA, Government Finance Officer Association, is our professional organization, and there are a number of areas where they have best practices, including general fund reserves, a structurally balanced budget, economic development incentives, and other best practices. So staff will be reviewing those and bring a range of considerations back to council and budget committee in the fall. Next, I'd like to touch briefly on policy A4, service priorities. So this slide is showing the language that's currently written in the financial policies. And I do want to note that when this language was developed, we did not have a strategic plan here at the city. This was back in the 90s. As part of staff research, we've looked at other jurisdictions, and there's a wide range of approaches related to service priorities and or core and essential services and financial policies of other jurisdictions. Some cities do not reference service priorities in their financial policies at all, but they do reference them in their council goals and policies and or their strategic plan. Other jurisdictions talk about essential services in their financial policies, but they don't define what those are. And then there are a couple of jurisdictions that define essential services as the services defined in ORS 221.760. And that's the statute that defines if a city is eligible for state shared revenue. So the services they list there are police and fire protection, street construction, maintenance and lighting, sewer, storm water, water utility, and then planning, zoning, and subdivision control. So there's really a wide range of approaches when you think about what should belong in a financial policy versus elsewhere in the organization. And as you have your workshop conversation on service frameworks, it will help to inform how we might move forward in changing our financial policy language. ORS 221.760, state shared revenue. And then I want to touch briefly on budget principles. So budget principles are agreed upon principles to guide budget development and decision making. These can be financial policies that are highlighted as part of this process, such as using one time funding for one time needs or reserve levels. There can also be other elements that are incorporated into budget principles outside of the financial policies, such as pursuing efficiencies and how budget impacts will be communicated. So there's some examples here that other cities have used in their budget principles. And as part of your June workshop, the concept of budget principles will be part of the discussion as you consider your service framework. With that, we'll transition to service framework. This is the slide we used with you last week that just talks a little bit about what a service framework is and a council role. And with that, I'm gonna turn things over to our Rafteles team, and they're gonna lead us through a service framework overview.

Thank you, Twyla. Mayor, members of council, it's very nice to be with you this afternoon. I am joining you from a jury assembly room. So if we have any concerns or issues with my connection, I apologize for that. But I am joined this afternoon by Jennifer Thiel, who will be assisting with the presentation over our time together. And so if I drift away for some reason, you're in great hands. Jennifer's background is as both finance director as well as a city administrator. But we have worked together at Raptellus, leading the strategic planning and facilitation team, but also, importantly, Jennifer's background experience in finance and serving at to assist organizations with budget frameworks and challenges such as is experienced in Eugene. I'm going to provide a little bit of context, a little bit of the setup that I'm going to hand it over to her to provide some examples of frameworks that have been applied in other organizations really to help seed the conversation and give fuel for thought. As you heard from Twilight in her presentation, the last time we were together, and then certainly the first part of this, there are many puzzles, puzzle pieces that connect together in order to create a process that's going to be well designed and provide for effective consideration by council as you are debating your budget options. So as we think about the budget framework, let's see, I think that we can. I'm not seeing the presentation. If it's up on the screen, we can pull that back up.

Is that joining us? You can see it on our screen in the room. Can you guys see that? Okay. All right. Great.

I cannot see it. There we go. Okay. I can see it now. Thank you. And, Councillor Clark, you can see it as well, correct? Yes. Perfect. Okay, so before we get started, just a little bit about what we mean when we talk about a service evaluation framework. And first of all, I want to just make the note that there is no single framework, no single answer to how an organization approaches this work. What we want to do is to help be a resource and to support you all in developing a framework that is going to inform your decision making, but also really aid staff in the development of recommendations that they can bring before you. So, a service evaluation framework is really just developing a structured set of criteria that helps the city examine its programs and services consistently. Importantly, it gives council, staff, and the community a shared language for talking about what the city does, why it does it, and also importantly, at what level. A couple things to keep in mind that having a framework does not mandate specific cuts to services or creates an opportunity for one-time activity. Really done well, this is a way to evaluate on an ongoing basis the budget opportunities and decisions that will serve the city and the community by extension. On the next slide, I want to just talk a little bit about why it matters and why it is helpful and why we think it's going to be important for Council to have a conversation around what a framework might look like for the City of Eugene. Budget decisions are going to happen. They're going to happen one way or the other. What we're suggesting is that making an intentional approach, really thinking through the tools and the methodology that will inform your decision making will give everybody more confidence and increases transparency for the community as well as for council and how you move forward. When you have clear criteria, staff and council will be working from the same starting point. The reasoning behind the decisions will be visible, not just to insiders, those that are working to develop and process the budget, but also to residents who will feel the impact. Importantly, a framework protects against both arbitrary cuts and arbitrary protections, both sides of the coin, for programs and services. It helps to remove some of the politics out of the individual decisions that will be before you. On the next slide, service evaluation frameworks aren't unique to any one budget method. We heard last time we convened some ideas around maybe rethinking how you are making choices and how you are evaluating your budget options, going to more of a zero-based budgeting structure versus a priority-based budgeting structure or some hybrid thereof. A framework does not preclude any of those things that can be applied regardless of the methodology that is being applied. What varies is the emphasis, whether the framework leans towards mandated levels of service, legal authority, or community outcomes. You know, those areas of priority that have been identified by council in the community. We're going to provide a series of examples that are used in other communities. across the country that we've had the pleasure of interacting with and can use as best practices really to see what resonates. What are some of the ingredients, the elements that are going to be instructive for your conversations? And so I think I've made it through without having any glitches on my side. So that's the good news. Now I'm going to hand it over to Jennifer Thiel, and she's going to provide a little bit of an overview and then some of the examples we've come up with.

Thank you Nancy and much appreciate I very much appreciate that, even in the middle of doing your civic duty you're here doing another civic duty, so thank you. Most communities use a blend of two broad approaches for creating a service evaluation program. The first lens is this legal and authority based concept it's asking whether a city is required to provide the service and and by whom. Is it by law, by contract, by community expectation, and at what level are we providing that service? The appeal in a legal or authority-based evaluation framework is that it's really objective. The criteria are something you can research and understand and document, and there isn't much gray area. That creates the second lens that you may use in a service evaluation framework is really outcome or priority based and it's asking how well a service advances goals that residents and the Council care about. Those things that might be part of your strategic plan, for example. Neither one of those alone tells a whole story, which is why most of the communities we've looked at and most of what we're going to share today shows some elements of both that legal or authority basis and the outcome or priority basis. Next slide, please. Thank you. So as we walk through the examples, we have four that we're going to share this afternoon. I want to flag three items for you to be paying attention to in each of those examples. And the first is how complex is the framework? We have seen and seen executed well frameworks that are very simple with just a few criteria or a few tiers. and pretty easy definitions to understand for each of them. And we've seen substantially more complex methods and models that have quantitative scoring methods and a lot of calibration and sort of parts that a lot of moving parts, if you will. We know that the more categories and the more criteria you have, you get more precision in a model. But it also creates a lot more administrative work, and it can be harder to true up or to get consistent sort of evaluation across raters. The second criteria is that I want you all to be looking at is what's driving this evaluation, and this is those spaces I mentioned. Some of our frameworks lean really heavily on legal and authority questions, and others weigh community priorities and outcomes more heavily. Most that we see do both and the question then really becomes sort of how, what you emphasize and why based on your community's specific needs. And then the third element that I call your attention to is language. This is one of those situations where specific words really matter because they mean something very real and important for the people who hear them and see them. And also, if you do this well, these are words you're going to have around for a while. And you want ones that you want to live with. And so terms like mandated or discretionary might land different with your residents or your staff or all of you than words like essential or value added. And so we want to make sure that you feel good about the language that you use, that it feels natural to you. We want to point out, as Nancy mentioned before, there is no one best way. There is no single framework that works perfectly for every community. The goal is really to understand what works for you so that you can create or adapt an approach that fits your needs, your style, your culture. So I have four examples I'm going to share. And the first is starting, we're going to start simple and we're going to move to more complex. So we've had the benefit of working with communities across the country on helping to develop service level frameworks. And in two places recently, Evanston, Illinois and Waukesha, Wisconsin, we've really focused on very tightly defined and simple frameworks that really look at what is truly mandated, what must we provide because of legal authority, what are core services that might be intrinsic to who we are as a community, but might not be legally mandated? And then what are value added services? What are those things that we've added either increase enhancing a level of service or adding new new service offerings that are an opportunity to evaluate? When we look at a service level framework that's this simple at that sort of, you know, three tier looking at what's mandated and the legal authority, We keep in mind that even if something is mandated, it doesn't mean we have to do it the way we currently do it. You know, just because we've always done it this way doesn't mean that's how we have to do it tomorrow. And so, even though those mandated services are sort of the floor, those are protected and sort of must be continued, we can still have conversations about efficiency and effectiveness to make sure that we're serving our community in the best way possible. In a service level framework as simple as this, we get a really good understanding of what our mandates are and what we must provide. And then we start looking at the top at those value added things and to kind of work our way down. And that's how we've seen that play out in Evanston and Waukesha. Our next example for you today is increasingly complex. You'll see the number of boxes on the screen keeps getting bigger. These are more categories, right? This framework here is not from one specific community, but from an extension program at Michigan State University that reached out and works with county organizations. And they created a framework for county, a reference for counties to work with. This model organizes services by the nature and the source of the obligation. Again, those things mandated by law, that's the floor. Those are the non-negotiables. and then articulates additional types of mandates. So you have things that are mandated by agreement or by contract. These might be time limited. You have things that are mandated by residents, those things that your community absolutely expects from you. And even if there isn't a legal component, there is political weight or a real need to make that need met. And then we have truly discretionary items that are, by definition, a choice. The distinction I want to highlight here is that a mandate to provide a service, like I said just before, is not the same as a mandate that specifies the level at which it must be provided. That distinction creates some real room for conversation, even within that most constrained category. Our next example comes from Toronto. This core services continuum adds a second and a third layer of analysis. So not only are we looking at that legal and authority basis of sort of what mandates that we have this activity in place, it's also then looking at the role the city actually plays in delivering it. Is the city a regulator, a funder, a manager? Are they directly providing the service? That distinction really matters because their flexibility to change the service depends a lot on how it is delivered. Then this framework provides a third lens and asks whether the service is at, above, or below standard service levels. So when you think in the industry or in the sort of best practice of how that type of service is provided, are we doing it consistent with expectations? Are we providing a higher level of service? Or are we not quite meeting service needs yet? This gives us some room for conversation around what services are appropriate for us to provide as a community and how we should provide them. It also creates some opportunity to really think about sort of when you put those three categories together, sort of how you create a more in-depth assessment. For example, if we have a truly discretionary service that the city is directly delivering it with staff, their own staff, and they're doing it at a level that is above and beyond the standard, that would be the type of service that would be a good candidate to have conversations about scaling back or making a different service delivery decision. Our final example comes from Salt Lake City. And Salt Lake City takes a much more quantitative approach. They have two sets of criteria, and every program and service is scored across up to nine categories, split between those legal and operational type lenses and a community outcome lens. That scoring combines into a composite that informs their funding decisions. By having it sort of quantitatively scored, we are giving staff a concrete and documented basis for recommendations for what to maintain, what to extend or expand, and what to potentially scale back or cut. And it makes it a lot easier to explain why one program was prioritized over another. The trade-off here, and I can't underscore this enough, is complexity. Nine categories with a quantitative scoring methodology requires a tremendous amount of staff time. and a lot more explanation and calibration than a simpler model like we've looked at before. So as we start to get to the point where we want to learn from you what resonates and what you sort of appreciate about different service evaluation frameworks, I just want to point out some sort of overarching themes. that from our experience helped to make a framework effective. First, they're tailored to the specific needs of the community that they serve. They're not copied wholesale from somewhere else. Effective service evaluation frameworks are simple enough to meet the needs and be used consistently but precise enough that they actually mean what you need it to mean. And also simple enough that two different evaluators looking at the same information would reach the same conclusion about the same service. The decisions that good service evaluation frameworks produce are those that staff can explain out loud and residents can follow. And they're built to last more than one budget cycle. We know that no one framework is perfect on the first try, but if it's too complicated to use it consistently, tweak it and get it working perfect for the organization, it's going to quietly stop being used at all. With that context, I want to turn things back over to Nancy to learn a little bit more about what you all are thinking based on this information.

Thank you, Jen. Appreciate the presentation of the different scenarios. We have a few questions we just want to bring into the room because we would love to get your general reactions and some of the elements that perhaps stood out to you as being helpful and particularly instructive. If there are things that are concerning to you in terms of some of the ideas that were presented or if there are elements that might be missing. We'd love to hear each of those things. And I expected in hearing the presentation that she just provided, it maybe also gave you some ideas around how the idea of budget principles can find their way into the conversation. And when we're together at the end of June, we will make sure we are tying all of these pieces together in a way that sets the city up for success as you navigate these questions. So with the questions before you, what elements of the frameworks feel right to you, are of interest and you think might have some value to incorporate? Are there concerns you have and are there things that are missing? And so maybe I will turn it over to you, Mayor, to help us guide the conversation here since I'm at a little bit of a disadvantage here in my jury room.

Thank you, Nancy and Jennifer, for that presentation and the questions to prompt this round. I have Councilor Evans, Councilor Kuczynski, Councilor Groves, and Councilor Keating in the queue. Evans.

I appreciate this presentation, but I want to note a couple of things that kind of jumped out at me. One is, and of course, because we are talking about budgets, we are talking about service deliveries, is a heavy emphasis on a lot of the quantitative measures that you're ultimately evaluating. Let me ask you this question. How much of a qualitative frame are you looking to integrate into this process? And the reason why I'm saying that is because I would really like to see us to be able to do some of the things like surveys, individual interviews, focus groups, so that we can get a well-rounded perspective of what our residents want, what our staff wants, and how we're going to be able to integrate those pieces to, you know, I think, All of the examples that you presented in terms of quantitative evaluation are excellent and we could take any one of the three or four that you presented and kind of work around it and make it ours. But I really also want to see some kind of qualitative information that we can gather and integrate into a final presentation, if you will, or along the line of several iterations in the process.

Wonderful. I'll try to reserve, not to comment on everything, but I might just remind council that as we're talking about the framework and the different elements, the strategic plan and the priorities that are contained within that will be one of the dimensions that we'll want to evaluate. Often the strategic plan is informed by what you've just described, right? To try to seek to understand what does the community care about? What are the priorities? What are the THE ELEMENTS THAT NEED TO BE CONSIDERED. AND SO I THINK THAT THE BALANCE IN TERMS OF A METHODOLOGY THAT REFLECTS THAT INPUT WHICH TRANSLATES INTO SOME SERVICE PRIORITY AREAS POTENTIALLY AND PERSPECTIVES OF THE COMMUNITY AS WELL AS COUNCIL IS A NICE BALANCE TO THE MORE MANDATED QUANTITATIVE COMPONENTS THAT WERE ALSO INCORPORATED THERE.

Yes, thank you, and thank you for the presentation. And I'll talk a little bit about the policies first. I really appreciate the review that's being done on the policies. Even though they are generally very strong policies, you can also definitely tell when reading them that some of them were written before we were in our current Measure 5, Measure 50 framework when we're looking at how we receive revenue being somewhat different than when these were written. And so I think doing that refresh is going to be really helpful. Regarding the frameworks, I do feel like, you know, mind the mixed piece there, and as well keeping in mind that implementing the framework will have a cost and the level of complexity can make it harder to economically implement the framework. I think one of the big questions or challenges I see is that we have a number of different services that are using, funded either in full or in part by sort of earmarked or dedicated revenue in some way, and which services are funded that way. Sometimes it's based on like, is it a service that can pay for itself because it brings in revenue, you know, like parking garages or something, but it's also sometimes based on past decisions about what topics council wanted to target revenue towards. So you think of things like the public safety payroll tax or the street bonds, library levies, parks levies, things like that. And I feel like that really has an impact on how we kind of view those service levels because we're like, well, okay, we can have a higher service level for this thing because we have the money for it. And then it's this other group of things that we don't have that dedicated earmarked funding for that tend to take the brunt of the conversation of how do we navigate these service levels. And so given the existence of that dedicated earmarked funding, how do we fairly incorporate that into the discussion of priorities? Because I feel like there are things that might get prioritized because we have the money for them, having you have the community coming back and saying, why are you spending all this money on this thing which can definitely feel like more of a value add while cutting these other things. And so how do we kind of integrate that into this discussion and address that as an issue?

Councilor Groves.

Thank you, Mayor, and thank you, Nancy and Jennifer, for the presentation, and also you, Twyla. I always appreciate your work here. Wow, I actually find myself agreeing almost completely with Councilor Kaczynski in her summing up of... what she sees and the issues. As far as the specific models, first of all, I agree with Councilor Kaczynski that I don't want to see this get too complicated because I think that just then gets in the way. But I really like the City of Toronto's evaluation model that they had here. I thought it was kind of a nice blend of some detail but not so much that it becomes cumbersome. I think that's something we need to be really careful of. I've said it before and I will say it again. I also would like to see, if it's not this time, at some point, us go through a zero-based budgeting exercise. What I've watched all my years with the city and now as an elected official, we always seem to nibble at the edges. I think if we start, instead of trimming around what we already have, if we start from the bottom with everybody at zero and build up based on a lens, and again, I think the city of Toronto provides a really good lens in that first box on slide 25, I think that would help us get to a point. Because whatever we try to reduce in this community, we have so many voices. Not very many of them line up with each other. You know, everybody has an opinion or five. And I think it's important that we listen. But at the same time, we'll drive ourselves nuts trying to work through this if we're hearing every single voice. So I think we need to find a way that we are able to process this in an effective manner that provides the absolute best we can for our community. So I'll leave it at that for now. I've got more I'm looking forward to talking about in our one-on-one interviews. And when we start really sitting down and digging into this as a team and a budget committee, I look forward to that as well. Thank you very much.

Councillor Keating.

Thank you, Mayor. And thank you, team, for the presentation in advance. I want to apologize for my voice or my nose strip. I am, like a great many in this community, suffering seasonal allergies, and they are certainly at their peak this week. I have some concerns about Toronto's and Salt Lake City's kind of a good, better, best, or low, mid, high, below standard, at standard, above standard, just three-pronged approach. I can't believe I'm saying this, but I would advocate for more of a star voting style, you know, five-tier, you know, allowing for like A, B, C, D, or F kind of grading system in that I don't necessarily believe that the three, or I don't recognize that that three-pronged approach would really be informative to counsel. My question is who provides the information ranging from equity impact to both the process and the outcome, and the environmental and sustainability piece, are we left as policymakers to be the ones who determine those pieces for our respective departments? Or similar to LCC's process, flashing back to my time as a board member at Lane, there was a program review process And that program review process, while not directly tethered to the budgetary process, clearly informed board members as to the quantitative and qualitative health of the respective programs. So who provides the information? And of all these cities, did any of them have a scoring rubric outside of just that below standard, at standard, above standard matrix?

I want to make sure that I'm following Eugene etiquette. So if I'm not supposed to jump in now, tell me. But I love that question. And I think, you know, I'll start at the easy part, not to suggest that it's easy. Looking at Salt Lake City, for example, Everything that from the list of equity and impact through infrastructure are their communities defined strategic goals. So they have a, you know, whether it's an unofficial strategic plan, but their council body have, you know, decided these are the five things that matter most to us are the six things. And So there are operational definitions of those categories as part of their strategic planning framework. And then at each of the sort of scoring levels, if you will, in Salt Lake, for example, they have defined the sort of, you know, what are the criteria they get you at zero or what are the criteria that you were two or four. And some of those are, you know, inside of the plan and some of them are outside. And I think You know, in economic development, for example, which is one of their criteria, they have a set of economic development goals from a different goal setting process. And so if you have a program that is only identified as meeting, you know, two or less You would score zero there. And if you had three or four of those goals, you would score two. So there's a lot of work that goes into creating both the scoring matrix and then training up people on how to review a program and and do that work. So we put that as the most complex one at the end because it is complex and you kind of work up to a system like that one. And I think that it's important then, regardless of the methodology you use, whether you go all the way to the Salt Lake City end or have a more simplified process, there's a lot of work at the very beginning that goes into creating clear definitions of your categories, whether that's a five ABCDF category or a three prong piece, having a very clearly understood set of guidelines that tells you what it is and what it isn't, So you can consistently sort of acknowledge what you know how something would score. We don't want to undersell the complexity and the work that goes into creating a system. Those definitions are some of the most important parts of it and really need attention at the beginning to make sure that you all feel good with how the different categories and sort of ratings are determined. And then that staff can understand, how do I even apply this and move forward with it?

So it's my understanding that flexibility with adopting, if we were to adopt, let's say Toronto's model, there's some flexibility to have kind of that ABCDF.

Absolutely. Absolutely. And there is no, so what we would absolutely recommend is that you don't adopt Toronto's model, but we build a model that might be reflective of that, but that meets your specific desires and needs. If we just had, I wish we had, you know, a model in a box we could just, you know, give you and it would work perfectly, but the best model is custom built for your specific situation.

I would hope whatever community your team is presenting to next would have a City of Eugene model that was robust and thorough and exemplified the best of our collaborative community. I appreciate the opportunity to weigh in.

Well, we transition to the next, if I might just real quick. I think that one of the things you heard in Jennifer's comments too, and I think it reflects the conversation a little bit, is that this may be an incremental process, right? So we might be need to begin at a place that sets the foundation and starts to evaluate certain elements of a program or sorry, a framework. And then over time, you may find different dimensions that are going to be important to incorporate. And so there are plenty of paths to pursue. TO MAKE SURE THAT AT THE END OF THE ROAD YOU HAVE A SYSTEM, YOU HAVE A FRAMEWORK THAT'S GOING TO SERVE THE COMMUNITY AND THE ORGANIZATION WELL GOING FORWARD.

THANK YOU, NANCY. AND BOTH NANCY AND JENNIFER, AS COUNCILORS ARE ASKING QUESTIONS IN THESE ROUNDS, PLEASE DO FEEL FREE TO ANSWER THEM IF THEY'RE DIRECTING THAT QUESTION TOWARDS YOU AND NOT TO STAFF WHO ARE HERE IN THE ROOM. THANK YOU FOR ASKING. COUNCILOR YAY AND THEN COUNCILOR CLARK.

THANK YOU. So, yeah, so I really agree with what Jennifer was saying. It was one of the comments I was going to make was that while some of this more complex version we have in front of us, the most complex, some of these I find very interesting and I think could be very helpful. I think we should maybe not go the full complexity on our first try and kind of use this framework this first usage to figure out what more complexity makes sense to add rather than assuming we want all the complexity at the very beginning. And then finding out that we don't use all of that that we spent time and effort to do. I also like starting from the base of Toronto's. I find it has a lot of the information that would be useful to me. I don't have any heartburn about the three levels of industry benchmarks because that's only one data point to me. What I find missing from this is an understanding of basing it on industry benchmarks is great and all but I'm interested in whether what we are providing is meeting the need in our community which may be different from other communities, and that would be more of a staff perspective, like is this program that is doing this thing, are you finding that you can't get to all the things you're being asked to do with what you have, or are you able to meet the need with what you have, or just getting a sense of that. So we kind of, I think that would be helpful along with the industry benchmarks, at least me personally, I would like that. Yeah, I think that's it for now, thank you.

Councilor Clark.

Thank you, Mayor. Nancy, Jennifer, and Twyla, thank you very much for the presentation. This is a fascinating process. I don't envy you your work because building the model from scratch is the hard part, I suspect. And building it right is the thing, and whether it works well for everybody is a question of have you built it right? So I'm impressed with what I see so far. There are some I want to echo the words of my colleagues before me. I agree with quite a lot of what they've said. What's most interesting to me is how we get to agreements around definitions at the start. And I will be looking for how we get tools for potential conflict solutions. RESOLUTION OF DISAGREEMENT ON COUNSELOR CLARK, CAN YOU STILL HEAR US?

WE'VE LOST YOUR AUDIO. ZOOM, JENNIFER OR NANCY, CAN YOU HEAR COUNSELOR CLARK? I CAN HEAR HIM.

GOOD. EXCELLENT. So you heard the other two, the first two things. The third thing that I would say was, I'm interested to know if there will be a kind of formatting for evaluating strategy. for meeting service needs. In other words, we may all agree on an outcome, but have very different ideas on the appropriate way to reach it. So is there an evaluation tool for the strategy for meeting an outcome? That's another piece of it for me. So thank you.

Well, we transitioned to, I do think that that also the discussion around strategies also is critical to the conversation around the strategic plan. What are you trying to accomplish? How are you going to get there? And then how do you evaluate the services and the level of investment that you're able to make toward those things? All of the pieces need to fit together. It's complicated.

And how do you evaluate the strategy?

That's right.

Counselor Kuczynski. Yes, thank you.

Going back to a little bit of sort of the broader conversation and the broader framework, I feel like a lot of this is coming up because like many, many jurisdictions around Oregon, is facing sort of a structural problem where largely due to factors set at the state level and beyond our control, our income is not increasing as fast as our expenses, which is putting us into a very difficult situation Difficult structural imbalance type situation that has been recurring and recurring for years And that you know in a large sense when I'm looking at the headlines right now like we're doing We've done a good job of like managing that compared to some places and I think that the framework kind of conversations and how we talk about the budget does a very good job of helping us make better decision making about how do we craft a budget that's going to do the best we can to meet the city's needs. And it also, I'm not sure how it gets at that base structural problem beyond just continuously reducing service. Because, you know, if you're thinking about like, okay, here's the service levels that we can afford, here's that kind of piece, we're still going to end up in that space where, you know, property tax revenue is going up 3.5% per year and PERS is going up 8 MILLION PERCENT PER YEAR OR HOWEVER MUCH IS GOING UP. AND SO HOW DO WE KIND OF INCORPORATE THAT DISCUSSION OF HOW DO WE KIND OF ADDRESS THAT PROBLEM BEYOND JUST SORT OF, OKAY, HERE'S HOW WE CRAFT A BUDGET SO THAT WE FEEL LIKE WHEN WE'RE PROPOSING THESE THINGS, WE'RE PROPOSING THESE THINGS.

THANK YOU, COUNSELOR. I THINK OF THIS AS KIND OF A CONTINUUM OF WORK. when we think about part of the, one of the puzzle pieces is strategies, so developing strategies. And strategies can mean a range of things. It can mean new revenue, it can mean reductions, it can mean efficiencies, it can mean longer-term things like economic development and other levers, tax reform, those things. So I really think of this as short, mid, and long. So this is really, again, part of this foundational long-range financial planning process where we're gonna start here because we know we have a gap as we come into the next cycle, and we're gonna start building the budget this summer. But I think through this conversation and conversations as we come back to kind of fall, winter, next summer, we'll continue to have some of those short, mid, and long-term strategy conversations, both at Council, There's going to be other pieces coming and kind of the take 2.0 with certain pieces of the work. And so I think there'll be a range of things that will weave through. So this foundational piece is one part of that larger picture because you're correct. This gives us a framework to make decisions as we kind of look into the next cycle. But there's larger elements at play here that we'll also have to discuss.

Thank you, Jennifer and Nancy, this is Mayor Knutson and I have a couple of questions for you as well. The first one is a follow up on a council discussion related to establishing a base framework, so to speak, and then adding complexity over time. I'm curious if through your work you have experience with that type of process of establishing a base case condition or a base framework for services and then jurisdiction or a municipality add additional complexity as they step through that process? And if you do have experience with that, what does typically that timeline look like? What is the sort of window of learning and information gathering about the base condition relative to continued improvement on it?

I think we lost last part of that question there on the audio faded away for us.

I think I can start to answer that. And that, you know, really we're looking at sort of budget cycle by budget cycle. And one of the benefits of you all moving to a biennial process is the ability to take a breath. and evaluate how things went before you jump right in and start the next round, if you will. So I think that what we would anticipate seeing is in this first budget cycle, if you are working towards an incremental approach, really starting with that understanding of a good set of definitions about sort of that mandatory set of criteria, what's that legal and authority-oriented set there, And having a thoughtful conversation after the budget cycle has concluded that includes staff and you all about, you know, what went well, you know, did we, did that work for us? Did it, did it hit the mark? What was missing? And then thoughtfully, you know, incorporating and testing, you know, additional elements for the next cycle.

Oh, we just lost audio again in the room from Jennifer just at the end of that last sentence.

Am I back?

You're back again. Can you hear any of us? Okay, there we go.

Yeah, I would say that the best strategies, the communities that are really living in this space the most strongly are always improving. They're always reflecting and they're always evolving. And so I don't have an easy answer on how long will it take. But I would anticipate if it's working well, you'll keep building it and reflecting over time.

Well, and I think that also just adding to that just a little bit, I completely agree. And I think I was mentioned in the last comment is that there are other drivers and factors that are going to contribute to kind of the steadiness and the sustainability of the budget process within the city, given the external drivers. And so as other elements shift, change, modify themselves, there may be other dimensions that have to be evaluated, right? Maybe maybe things are not as dire or maybe things are harder and that is kind of TBD. And so it's keeping an eye on the radar of what's coming. And as Jen mentioned, that reflection backward, what is working of the framework? Are there elements that we're getting stuck on or that are not informing our conversations? We don't want to create a system that is overly complex and doesn't add value. Just as using performance measures or KPIs, if you're not using the data, the information that you're generating, then it begs the question, how is it being helpful and are you wasting time doing so? And so really being reflective and intentional throughout. And also, I just do want to take this moment to introduce Ben Kittleson because we had him join also in a phone meeting. I was wondering why we have a new person on the screen. He's listening and he's a member of our team. He's not an imposter. We're glad that he's able to join us. His background also is in budget. And so we wanted him to have the benefit of hearing your conversation.

Welcome, Ben. Thank you for joining us. Nancy, I have another question that's a follow-up to what you just described. I'm wondering if you could describe for us an example. I don't know if you would need to make it anonymous. from previous uh communities that you've worked with but an example of what you just described in terms of using the framework moving through a budgetary cycle reflecting on that framework and then and then adjusting or adapting that framework to something that was learned could you just share with us um an example or two of what that has looked like in your work

Gosh, to provide a specific example may be challenging, but I will kind of broadly speak to that, and that is those organizations that are high performing, consistently moving the needle forward and able to sustain budget, but other operations in a way that is meeting the needs of the community are equipped to do annual or even more frequent evaluation of processes. And so what does that look like in practice? I think it's evaluating the tool. Right now, the tool is not created. The tool is not absent. It's not part of the culture and how you're delivering and deliberating on budget decisions. Once that is in place and you have gone through a cycle You can have that time to reflect and decide what are the functions, what are the elements that really help us to understand what's going to be important, and what are the gaps. One of the things that was mentioned previously was kind of that program evaluation process. That's not something that happens in a blink, right? That takes time, that takes resources, that takes intentionality behind it. There may be elements that kind of require that additional discipline to stay focused and to do that if i the kind of ongoing review um i feel like i'm not answering your question very directly uh because i don't know that there is a direct question or response other than to say that the evaluative process The tweaking and modifying over time is really the best practice that we would encourage and really embracing the spirit of kind of continuous improvement, not to make things more complex, you know, necessarily. Sometimes it's about simplifying. And I think being open to that and having, you know, conversations about what's working is going to be the best driver of that long-term success. That's probably not a very satisfying answer to your question, Mayor.

I think that was a good start and even giving us the opportunity to think about that we are both evaluating the tool, but also how we used the tool. That is an important part of the cycle of reflecting upon how much utility was pulled out of this type of process. My last question is maybe simpler or maybe not, but I was just curious in looking at these examples, and thank you for sharing with us a range of examples from other cities who have implemented a service-level framework. I'm just curious from staff and, Trila, from your perspective or others, I would I would say from our process that though it's been quite informal that the current approach that we take to our discussions seem to be more centered on an Evanston, Makisha, Wisconsin sort of an approach where we have an idea about their things that we have to provide and though they are in a policy document that we now are updating and we haven't looked at in a while, that those are foundational, that there's a core of work. Many times in this last year and a half, the core of the core has been referenced in conversation. And then value-added components. There is a lot of complexity in our budget given the way that we fund different things. I'm just curious if, you know, in looking at sort of where we're starting from, if you feel like we are beginning, because we don't yet have agreement on shared language and really what we mean, if it's kind of like we are really started at the beginning of this or we've maybe done this informally but not given ourselves the benefit of this type of structure.

Thank you, Mayor. I think it might be a combination in that as we've had various conversations, we have talked about core of core or other pieces. But as an organization, I think going through a process like this is very helpful to really think through once we have the definitions, we'll be able to answer those questions both that council has raised and others in the community have raised about what is essential, what is core, what is mandated. We haven't had a good framework or language to really articulate That is an organization to the community, so I think it will help us be transparent and clear as we both talk with the organization, council, and community. And then, sorry, I had one more thought there, and it just slipped away. But yes, I think this is needed and foundational and will be helpful as we kind of navigate the changing landscape and some of the short, mid, and long-term strategies we need to develop.

Maybe Twyla, I might just add onto your comment too there. One of the things that I hear in your comments and couldn't agree more is that the framework ultimately serves the council to be able to make these decisions, but it's really integral into the organization, how it's used, how it's implemented, the language that is spoken among department heads, among city leaders and those who are delivering services. is really important. And so this is something that transcends just the decision making level and really has to be integrated. And it really then reflects an iteration of culture development. Who you are as an organization, how the city staff operate together really becomes a dimension of what's going to make this successful to make sure that IT'S NOT LOST IN TRANSLATION AND IT'S NOT BEING INTERPRETED IN WAYS THAT MIGHT BE CONSTRUED DIFFERENTLY DEPENDING ON WHERE YOU SIT.

THANK YOU BOTH. THE CLARITY THAT COMES THROUGH A FRAMEWORK AND A PROCESS LIKE THIS GUIDING ALL METHODOLOGIES, I THINK THAT WAS A REALLY IMPORTANT OBSERVATION. I REALLY APPRECIATE THAT AND APPRECIATE THE INTRODUCTION TO THIS WORK. COUNSELOR KEATING.

THANK YOU, MAYOR. BEFORE I DIVE INTO THE SERVICE FRAMEWORK COUNCIL ROLE QUESTION, WERE THERE ANY OF THE COMMUNITIES THAT YOU PRESENTED TODAY, EXAMPLES IN WHICH YOU PRESENTED, THAT BROUGHT IN A BROADER BASE OF COMMUNITY MEMBERS, INCLUDING BUT NOT LIMITED TO A BUDGET COMMITTEE IN ADDITION TO COUNCIL TO DETERMINE THE the service evaluation of their respective departments and programs.

So one that I can speak to briefly is in that Waukesha, Wisconsin example, our team actually helped to facilitate a process somewhat like your TAG approach with a community-driven sort of committee that did a lot of that evaluation and did a lot of that exploration as part of the the framework development and so there was you know there was involvement at that level of folks really getting smart about what the community does and doesn't do and then really helping to understand and and get their voice in on what things are most important um if you go to the other kind of end of the spectrum and one like the salt lake city example where you had those community priorities that were part of the service evaluation framework, those were directly influenced by their strategic planning process, which was directly influenced by their community engagement process. So, you know, the voices come in the room in that way in helping to define what those community strategic priorities or strategic pillars are. And then the framework was sort of built to support those ideas.

REALLY HELPFUL. I WOULD SUBMIT THAT IT MIGHT BE IN OUR INTEREST TO HAVE THE BROADEST ARRAY OF COMMUNITY MEMBERS DIVING INTO THAT WORK ALONGSIDE A TAG 2.0 AND THAT VERY WELL MAY BE THE EXISTING BUDGET COMMITTEE. I WANT TO SHIFT MY OBSERVATION TO THE COUNCIL'S ROLE ON SLIDE 15 IN THE SERVICE FRAMEWORK. It indicates that council's role is to provide a high-level policy direction, but I also interpret our role as having obvious statutory authority, fiduciary responsibilities established by ORS, and responsibilities to our respective communities and our constituencies. Do you see the framing as council's role, and I'm asking this to staff and to our consultant team, do you see the framing as council's role at the high level 30,000 foot in conflict or potential tension with the models that have been laid out in front of us, in which I infer that councils, ranging from Toronto to Salt Lake to Waukesha, were diving in at a pretty granular level to determine what the service level assessments were. How do you, A, do you see that potential for that tension versus that high level and that more granular approach? And if so, how do you propose to alleviate said tension?

So I don't see a conflict. I see the council role in many of these areas as creating the policy guardrails. and really having buy-in early that we're going to use a service evaluation framework and we're going to agree with how these concepts are defined and what categories are being used to determine what budget proposals come forward to us. I believe very much from that policy setting standpoint, creating the frame is absolutely consistent with the role of an elected body. Where I have seen challenges, and I, based on even what I'm hearing today and your very deliberative approach, I would not worry, you know, I'm not worried, but where I have seen things get a little fuzzy in some communities is then in after developing a framework, second guessing, it after the fact. or disagreeing and sort of relitigating how things get assigned. And so there's a degree of sort of, there's a handshake, there's a degree of trust that goes into, so we've really helped create the criteria and the frame and we trust that it works. And then now it's happening and we still trust that it works. I think that's where we can see they're becoming some fuzzy sort of role situations. When in the middle of the process, the process is getting relitigated. I anticipate that because we are proposing a very collaborative process from the start, staff isn't just handing you a framework and saying, this is the framework now and here we do it. Because you're very involved in the development of it, I don't see that as being a challenge.

Mm-hmm. Well, I think just to underscore that too, I agree. You know, this work is important. It's complicated. It also takes all hands on deck. I mean, I think that everybody around the table would likely agree that resolving the budget challenges, but also leading effective service delivery on behalf of residents is a team sport, right? You all have a role to perform. And it's together that you'll be successful. One of the things that, you know, we like to make observation around is that as counselors, you wear many hats, right? You aren't just approving the budget and making decisions. Decision-making is an important role you provide. You also provide strategic direction. You provide oversight. You are representatives with your communities, your trustees of, prior decisions, and that speaks a little bit to what Jen was just talking about, about holding true and honoring prior decisions moving forward. Your conveners, you bring people together to solve problems, to identify what's important. All of these hats are critical to the long-term success and viability of the organization, and each of these informs a portion of what we're gonna be talking about through this process. One of the other things that comes to mind in some of Jennifer's comments was the importance and the value of not just defining the framework elements. We can all agree that's going to be very important. We need to understand how we're defining service levels, programs, these sorts of things, but also What are the operating norms in a team sport environment? What are the rules of engagement across the council, but also working with staff so that there is the ability to step into the tension when it needs to and when it's comfortable and important to do so. But how you do that is going to be important as well so that it becomes productive and doesn't become something that is detrimental to long-term success. So there's lots that we will be able to explore and talk about and how we navigate through this process together. And when we are in the retreat end of June, beginning of July, these are going to be important conversations to make sure that whatever framework and policies and strategic plan elements, all of these puzzle pieces, how they fit together, how to work them effectively as a group.

Thank you, Nancy and Jennifer and Ben for joining us today. I don't see any other questions from any council members. And so with that, I'll just say that we appreciate the opportunity to have this introduction to our policies, financial policies, and an approach to a service framework. and are looking forward to the continued conversation over several meetings this is our one agenda item for today and so this concludes our agenda for the 20th of may and i now close the may 20th 2026 city council work session and we are adjourned