City Council - Regular Meeting

clerk in the uh manager's office to share with council. I know the services will be coming up later on in May, but um lots of things to recognize in the community. So if everyone can join just in a moment of silence in light of all that thank you. I think when the news is heavy in the world I remain grateful that we get to serve in a community um like false church. So thank you all for joining us tonight. Um, so it's probably a weird pivot to switch to happy birthday, but I feel like we should probably have some levity

and celebrate and appreciate what we have. And so why we're going to embarrass you for the last time. Maybe not the last time at least at least for the last time during budget season. So if you don't mind, we would like to feed you for your birthday. Okay, everyone. Happy birthday to you. Happy birthday to you. Happy birthday, dear Wyatt. Happy birthday to you. Happy birthday, Wyatt. Thank you.

And I think these were from earlier, I think, which we thought were really cute. Were we supposed to sing with this is a great photo. This is a great photo.

Can't have one of Wyatt. We can't have enough watts. Yeah. Thank you. You know how they show the president after they're done with their term and how they've aged. I would like to see the before and after of a city manager. You just have to look at his employee ID. Yeah. I noticed his hair is a lot darker on the picture. So, too many budgets. So, that's right. Okay. Well, speaking of budgets, let's jump in. I know we have work session as well as close session at the end of the night. All right. So, we are going to lead off with Um, could I? Yes. Technically, just roll call. Do a roll call real quick. Mr. Aan here. Miss Connley

here. Miss DS here. Flynn here. Mr. Schneider here. Miss Underh Hill here. Mayor Hardy here. Thank you for the record.

All right. So, for our agenda today, uh we'll start with the third quarter financial report. Budget and finance discussed this on Friday. Uh in their meeting. Uh they did have school board and school staff representation at the meeting as well on Friday. Um so David S will walk us through uh the third quarter results and um and um and they do have good news in them on the revenue side that affects both the current FY26 as well as the budget that we're talking about for FY27 which starts on July 1st. Um the uh Uh we're planning to have a discussion uh on the the school budget and largely it'd probably be a carry forward of the discussion that started on Friday morning about uh the revenue betterment that we announced on Friday morning. Um and then we'll go into the public safety budget and uh we have Chief Farard and uh the command staff from the police department joining us for that discussion. And then we have um the full-time employee count the council action to adopt the employee count compensation increase and the classification plans. That's a new action uh this year in this year's budget uh that echoes actions that the council took, you know, back in the 90s. Um and in a review of the city charter, uh we're bringing uh those actions back to the city council. Um so that's our our budget work session for the night. And so with that introduction, I'll turn it over to David and he'll do a I think a pretty high level and more concise summary of the presentation he gave on Friday morning.

All right. Thank you very much, Mr. Shields. Uh so yeah, if you don't mind opening the presentation. Okay, great. So if you move to the next slide, next two slides, I believe. Yeah. All right. So here I'll just kind of touch on at a high level how we're looking. So we're continuing the strong Thank you. We're continuing the strong momentum that we had presented back in our quarter 2 results. Um some of the main takeaways here is that our personal property sales meals tax continues to come in very strong all relatively within the uh where we were coming in at quarter two. Not too many significant changes there. Um again, similar story with our transient occupancy tax. Uh that one has been declining further than what we've seen in quarter 2 and I think a lot of the uh things going on with the economy has has impacted our hotels in the area. Um moving on to our uh non-ax revenue. I think one of the key things to highlight here is that our charges for services is coming in uh higher to budget and that's primarily driven by um some of the higher costs that we're incurring for our Aurora house and uh Arlington has uh services that we provide for uh the Aura House. And so as we incur higher costs, we charge it back uh proportionately to Arlington. And it's the same story with fuel charges. as fuel charges uh rise up uh we do charge the higher rates back to our schools. Um so one of the items uh that is new on this table is uh I've outlined here our Westf falls phase 2 and in prior

meetings we've discussed that um with the most recent developments there is an $800,000 uh debt service payment that needs to be made in FY26. And so that is what's driving the $800,000 reduction. uh we've had discussions on how to fund it and so that's where we're uh pulling the uh funding from from our revenue. So uh we are expected to be about uh 1 uh it's a little little smaller but um 1.3 million uh with uh the reduction of our debt uh service. So that's the the highlevel summary update here and I'll just keep moving along unless anyone has any questions. Um, so yes,

all these years I wasn't aware that the general government charged the schools for fuel. Is that how much is that? A lot. A little. So out of the I mean they're a lot of buses and they have big gas tanks. They do. It's their their standard formula. DPW centralizes fleet maintenance for the whole city. So they send bills out to the police department. They send bills to the schools. It's all kind of handled as a bookkeeping exercise so that we can track the cost that way.

So does that just seems like a funny charge for services? I don't know. Do they does a school do the same thing for like rental of facilities? They include that in their budget what the general government pays for rental facilities. So it's that sort of back and forth. Yes. And so it is we recognize it's all public money and so we don't want to do sort of unnecessary exercises but it it also is useful for tracking your actual cost for for certain things and so that's why we do it. Okay. Thank you. Move to more green buses. Have we seen that go down?

That uh we could look into that information. I wouldn't have available. I'd have to reach out to the schools to see what their charges would be for the schools. Yes. Likewise, I had a question I've not sent in yet, but about utility costs. So, with investments and upgrading like Meridian to be net zero, I think I've actually we had a concern from FCAN that actually utility bills are actually going up and not down. And so, I broader question about like our government facilities and how the investments we're making in green infrastructure does or does not lead to actually decrease utility bills and if so, why not? because that's something that you know if you make these upfront investments hopefully your operating costs go down right and if we're not seeing that then look into why

that would be a great thing to be able to track over time and I I could answer part of that I think for heading into FY27 our electricity bills went up significantly um over 20% so again um citywide not just

yes just citywide so I think uh with I think and again this speculation but more of the data centers that are taking up a lot more of electricity usage. I know for my own personal electricity bills, they've gone up and so we did have to incorporate those increases. So those increases are reflected in the budget, but to your point, it is offset with some of the green initiatives and that that we have in place, but uh we can get you a more defined number. So, we we um recently added a new staff member to public works and one of her primary responsibilities is um getting us organized on our energy tracking and reporting. And so, our our plan at this point is to report out to the ESC and share with council in June kind of our annual uh go report. And then and the goal is to have some more uh more specific energy use information to share with everybody. I know we got a public comment about funding community center roof and solar sooner than next year and I think we talked about is that's important but not urgent but if we see that actually ties to decreasing utility costs it could you know bring the urgency higher right like we want to reduce our operating expenditures too.

Y understood. Thank you. Yes.

Okay. So on the next slide here uh we're outlining in terms of with strictly on the tax revenue side uh based upon uh our total tax revenue favorability is uh 2.18 million and so if we reduce that based upon the debt service uh related to the Meridian High School uh we also have uh an unassigned fund balance. So, we're projecting about $700,000 that will be needed in order to meet the policy threshold of 17%. Uh, and so if you subtract one and a half million out of the 2.18 million, that leaves us with about $681,000 of tax revenue. And so based upon the tax uh revenue sharing agreement with the schools, uh we're estimating a projection of $340,000 um one-time funding uh that would be carried over into 27. So that is the uh the estimates there.

So this only talks about revenue, but with the I'm going back to fuel here because it's ugly. And so how much of that 681 do you think would be required to to deal with um higher than budgeted fuel costs because we're talking 25 30 or more percent higher fuel costs.

Yeah. So in our uh if I go to the on our operating expense slide here. So the the additional fuel or the increasing fuel costs are we're projecting to cover it within our budget. Um we're coming in pretty tight uh on the operating expense side. Um the fuel cost you'll probably see predominantly within our public works department. Uh but we are projecting um currently about $150,000. There's also other other things like snow removal that's also negatively impacting um how much is being spent there. But uh but that is being accounted for um in our operating budget

and we can we can aggregate it all up and you know what the entire the city spends entirely on unled and diesel and then make some calculations in terms of what the range of impacts could be in the coming year. Yeah, I was just looking at that going, hey, that's great revenue number, but then we're also getting hit with some big uh cost numbers. So, it's kind of like the net kind of works out lower.

We're worried about how the costs are going to percolate through everything. Um fuel itself is a fairly small part of the overall budget. Um, so I don't I'm not envisioning that being a dramatic issue for us from a budget perspective, but general inflation is is a risk. Okay. So, uh, any other questions on this slide?

At budget and finance, I think most of us were there. Um there were questions about why the debt payment and unassigned fund balance had to come off the top before revenue share. Why could you just briefly recap for everybody?

Um sure. So uh a couple ways to look at it. One is uh first the west falls phase 2 uh payment had it happen that was not envisioned to be shared. Um and two, as a um as a basic principle, um covering debt service is is 100% on the general government side. That's by state law and uh the Virginia constitution. So that's unchangeable. And so anytime there's a capital project that has a a school pro school capital project that has a big impact on the general government side, there would need to be a hard hold harmless provision um for revenue share really to work if there's a big increase in debt service. So Meridian is right now transitioning off of the ground lease payments and into general taxes. And so it was always assumed back in 2017 and now we're executing that that um you know 2017 was before revshir actually even existed but it was not envisioned that one side either schools or the general government would absorb that 100%.

And fund balance unassigned fund balance getting to 7. So unassigned fund balance is just uh that's something we do each year so the council's familiar with making that payment at year end. That's always kind of the first thing that is covered and that is explicitly written out in the principles of revenue sharing as a carveout and a financial policy that we haven't deviated from and both schools and general government benefit from unassigned fund balance in an emergency and um and so it's a a mutual benefit. Thank you. And and that's also what helps keep our bond AAA bond rating high. Right. That's right. We've done that. We've done this in the past. I remember several years ago.

Every year.

Yes. Yes. But a couple it was big at some point recently and I remember having this conversation in the last three years. Yeah. Okay. Okay. Great. So I'll move on to the next slide. Uh so in here uh back when we were developing the 27 revenue projections uh I had presented in December 1st the low, medium, high based off of the most recent uh revenue data that we were seeing. The high scenario seemed to be a very likely projection. And so that's the scenario that was selected. And so, uh, as you can see here across the board, uh, we'll have, uh, total local tax revenue growth at 6.3%. You know, the biggest drivers, uh, is coming from your personal property tax, uh, at 12.3%, sales tax at 8.1%, and then meals tax at 5.6%. So, all of it, um, the really big drivers above 5%. And so that was the basis we used heading into this this budget. But now that we have our latest uh Q3 numbers, um the projections uh themselves were coming in in some categories higher than what our F FY27 proposed revenue numbers were. And so in total FY26 projections are coming in at 6 and a half%. And so we felt comfortable uh going back into our 27 revenue projections and reforcasting uh a higher revenue numbers if uh the FY26 projections are our new base. And so some of the biggest changes you'll see here is that in our personal property tax uh we're increasing it by

230,000. So, we're going from 12.3% uh growth to now 15.3% growth. And that a lot of that is just driven by a lot of the good work that the commissioner of revenue and his team is doing. Uh the sales tax, we did think that there is still some more room for growth. Uh and we add an additional 70,000. So, we're going from an 8.1% growth to 9.1%. Uh on the meals tax side, I think that's that's probably the biggest growth that we saw in terms of the opportunities. So we added an additional $410,000 of revenue. So we were going from about 5.6% to 12.5%. So double digits growth. And then um a few tweaks uh we did make a few other tweaks in the other tax. uh we did um with transient occasion tax coming in uh much more unfavorable. We made some tweaks there. So all in all uh we identified a total of $700,000 that the uh that we can now add to our FY27 budgets. So I'll pause here for any questions. You know, uh Mr. So, we discussed this on Friday at budget and finance. Um, but I had questioned and just to repeat it for those who might be watching tonight, the meals tax. I I thought, wow, that's a big jump. Um, and but as we talked through it, we talked about we have three restaurants that are going to be opening. Um, and so you feel that that's not too rosy of a picture. You feel that that's accurate? You know, I think some of us, you know, are we getting too far ahead of ourselves and and but you feel confident in that number?

Yeah, I feel confident in the number. But again, where I where I may have some hesitancy is just again the uncertainty that I've been talking about for the past seven, eight months. It's just we haven't seen it yet. And so now it becomes a question of is is city of false church more um insulated from these things? And so again, that's based off of the assumption that I have enough runway where I feel confident, but again, anything that could come up um in the future could adj uh make a few tweaks here or there, but again, I I feel comfortable that this is a a good a good number to to u project.

Okay. Thank you, Aaron. And and this came up on Friday morning also and I just wanted to reiterate it I guess for the record or make it clear for folks who are watching but weren't following the budget and finance meeting is the personal property tax number. when we look at that 12.3% that was budgeted and the revised forecast for 15.3% that those numbers are high because the commissioner of revenue is bringing on a lot of vehicles um and has been doing work in that area but we should be thinking of it as an anomaly in terms of you know that number is likely going to plateau and so we're not going to be seeing numbers like that going forward in all likelihood and So, we're getting the benefit of it in terms of additional revenues, but we really shouldn't be relying on that growing all that much um in terms of, you know, the year-over-year increases and operating costs that we see. Um so, so we're benefiting it, but really can't like count on it growing at that same rate going forward.

Correct. This growth is a one-time unique exception growth. Yeah, we would not project this growth and unless again we have more development, anything else that would drive this growth. Correct. Um, one of the things that has been the hardest in my time doing this is this projecting. It's so hard. So, thank you for for looking at it and working through it. So, when we met in December, there was the low, middle, and high. And it was like 5% flat and then 5% higher. That was our cone of uncertainty. Yes. So we've we're exceeding the cone of uncertainty with these numbers. That is correct.

Okay. Yes,

that's amazing. That's what we've been that's the thing that we've been working for for all these years is to continually be increasing what we're bringing in. So, I think I wasn't there Friday, but I just want to say good job everybody because we've built and built and built upon a foundation. So, while there are no guarantees and there's still a lot of uncertainty in the world, I think that is something worth commenting on and recognizing that that we're doing okay. um compared to the region, compared to where we were five or 10 years ago, the things that the plan that we had to bring in more residents, bring in more businesses is is coming to fruition here. And again, who knows what's going to happen the next quarter and the one after that and the one after that, but I think this is the trends are really good. So, I appreciate that. Um, let's see. with the personal property tax that Miss Flynn just mentioned, is there do like how much do you think is the the one time of that?

Uh so we estimated about a million dollars uh was a one time. Okay. So we're projecting about 1.18 million. So 1 million of that 1.18 would be the one time. The one time. Yes. Okay. So then but it would still continue to grow just not at the same excellent rate. Correct. Yeah. And I know we understand and part of the the growth here was we do know that there's still uh more tenants moving into the city and so I think uh there's a little bit of that growth built into that $230,000 number. Uh but yeah, I think if we get to a point where if housing does not increase, that number may may be flat. Right. Right. Yeah. So

that makes sense. Yeah. The last building at West Falls is the alder is 80% leased and the oak is 60% sold, I think. So I think we are plateauing and shouldn't have a whole bunch of new cars after this year. Those people at the reserve though, they're going to have nice cars. I know it. They're not. Yes, they are. They're going to give up their cars.

They're not giving up their cars. There's parking for them. There's some coming in. Um, so I guess your the title of this one strong projection is good foundation. I think that's a good title. But one of the things anyway, one of the things that we struggle with in the budget is getting it right and not having a huge extra at the end of the year. But we still rely on some of that extra as you know, not necessarily surplus, but contingency or filling in the gaps of unexpected things. So that's all built into this as well. Correct. the uncertainty, the contingency, the fixed costs that may show up next January that we weren't expecting.

Well, what I can say is that just based off the most recent trends, I think that's uh what this revenue numbers reflect, I think some of the uncertainty because there it hasn't shown outside of within the transit occupancy tax. Um it's difficult for me to project what that amount will be because I just I haven't seen it here. And so but to that point there there is a little bit of I guess you could say um risk to that. But again just based off everything that I've seen all the data it just um it's very difficult to project that heading into next year. Okay. Yes. Thanks. Do you have more? Yep. You're done.

Okay. Anything else on this? I mean, so bottom line, certainly better place to be here than we were a year ago when you said Q3 is not looking great and we had to do the reverse. So it's certainly u nice to see us defy expectations a little city that could. Um I guess my question this triggered when Dave asked this at budget finances like what are the risks out there that we don't know about? Um let's say the war continues in the Middle East, fuel prices are high, Q4 doesn't look great. What does that mean? I guess if we don't see the upside in 700,000 in next year's revenue like and we've then either spent it or given a tax rate cut like what will we do in that scenario because I think essentially what we're trying to decide now is with this reforcasting what do we do with the 700,000 right but because the what if scenarios are pretty large um I guess I want to think ahead through that before we make decisions about what to do

so we uh have been thinking about that as well on the staff side and so we would encourage uh caution in the use of the 700K and um and deploy it towards resolving kind of the last big structural issue that we have in the budget which is the paving being uh heavily reliant on capital reserves. And so, um, I, you know, I think that would be a go-to place to try to transition, take a chunk of the capital reserves that are being used for paving and use these funds to replace those capital reserves to wean us off of capital reserves. That would be, I think, a a prudent way to use um, at least a significant portion of this. And then if the revenues didn't materialize in Q1, I guess is the question. Like where are the areas where we could easily cut back expenditures? Like where would we pivot? I guess paving is one of those where you have a a six months paving season. And so you say, well, we're just not going to pave as much. That feels like a pivotable thing versus positions, right? Which would be a shame to decide that we're going to hire them and then not be able to pivot back and cut back then expenditures if revenues didn't come in. I think honestly any new money that's put towards paving right now, if the council were to elect to do that, it's not going to be spent until next spring. It would not be spent this fall. Uh we always have two paving seasons and we would use this money because we already have kind of the the upcoming paving pretty well mapped out and so we would use any plus up in the spring. So that would give us like summer and fall to see how like the economy is doing, whether revenues are coming in before we essentially are spending that 700,000 or whatever the share might be.

So So we're not paving in first quarter, the July, August, September. Well, what I I mean basically I think we have our paving streets all identified and uh for this spring and for next fall and um so we would plus up in the spring. Andy, would you agree with that statement?

I think that's correct. And at we typically carry over some of the the spring paving work and it gets done throughout the summer using in this case the FY26 money. So so um and then as Wyatt said there's another trunch we would kind of launch in the fall with the first part of the FY27 money and then you know the team's working through this spring's kind of work right now. So, so that is one strategy. I think Wyatt was talking about as a potential way to think about it is to dial back the use of capital reserves with a portion of this money to um kind of wean us off of that because it it becomes a structural change to the the budget long term which I think we've we all at least on a staff side we want to work our way out of. That means we'll draw less off capital reserves, which means there's more reserves for the council to kind of use for for other projects or or other needs in the future. And so that's another way to set

no operating expense and we should pay for it like an operating expense. So yeah, I think capital reserves should be used for capital stuff which includes rebuilding when needed, but not general paving, but new sidewalks, new bike paths.

But the reason why I'm kind of started this line of questioning is like like Mary Beth, I think we should appreciate that there's a good news story that we're reforcasting revenues look better. At the same time, I share some of the caution and what we do with it because of the uncertainty. The only thing certain is uncertainty has really stuck with me. And so as we think about what to do with it, I want to be very judicious in thinking about how we can easily pivot and it's not all spent because obviously if you add positions that is very hard to unspend that if things go bad, right? Uh versus paving sounds like it's one of those that we wouldn't use till next year. And obviously the structural problem with capital reserves feels like a very good argument to solve. And so that's kind of like where my head is in thinking about how to best deploy the 700,000 in an era of so much uncertainty.

Dave, first a question about 2026. In the 2026 budget, we set aside a contingency uh in view of the um the events that were starting to occur. the number that you've given us the net net the 340 514 after the revenue share of the schools does that include whatever may be left in that contingency

uh so this one is just the revenue side uh in terms of the contingency I do have a slide uh that would show that we would have to use a good portion of that contingency to pay for the uh Fairfax uh uh homeless shelter uh catchup that that they're charging us. So, uh this money would be an addition to uh that we would carry over into 27 and present to council uh as part of the budget amendment in the fall. So what is that number minus the um the expenditures for the uh homeless shelter?

Yeah. So we are projecting to be at about 171,000 uh surplus um in the contingency which is separate and apart from the 34514. Correct. That's what I'm trying to establish here.

Yeah. So if you strictly focus on the contingency, we would use about in our uh human services, we have about an overage of about 376,000. So we would uh request council uh the use of contingency of that amount to pay for um the Fairfax on the shelter. So that would leave us with about 24,000 uh remaining in the contingency. Okay, I'm just trying to figure out net net where are we on that contingency? So that would theoretically be 24,000 that would be over and above the 34514, right?

Yes. Correct. Um the next question then going to FY2027 um the net figure of 700,000 Does that is that net of a potential wamada payment? In other words, have you fully budgeted the wamada payment and the 700,000 would be net of that?

So, the wamada would come out of our operating expense. Uh, but to answer your question, we haven't reflect the changes in the wamada um within our budget. I think there's still some conversation, Cindy, with the state. So, it's difficult for us to any number we put in now would still be an estimate or a projection. Um, and so we're still waiting from the state. So, this one will uh have to be a possibly amendment, but I I do believe we have uh several options to help uh mitigate that um risk with Wamada. So I'm I'm just trying to figure out how secure at this point is the 700,000 right which is other people have asked the same question. So have we otherwise budgeted the worst case for WA operating?

So uh you I mean we can go ahead and just talk about the Northern Virginia Trust Fund and that's what our strategy is. Do you want to sort of talk about the details of that? Sure. Yeah. So, we have a trust fund with the NVTC and so any of these spikes or increases uh we can pull from the trust fund to to help pay for um these increases. uh in the long run we'd have to pay reflect those increases within our budget but in moments like this when there's uncertainty uh we are shielded at least for the FY27 budget from any of the spikiness or lack of funding from uh the state. So

so we could provide a chart just to show what those balances are. We make, you know, gas tax money goes into it, other city subsidies and the NVT, you know, working with NVTC staff, we maintain a balance with that trust fund. So using it has consequences long term, but it is, you know, in terms of dealing with an unexpected shock like the state not doing what we kind of thought they were going to do last fall. Um, the trust fund would be our our way to get through the fiscal year and give the state another chance hopefully to have a better long-term dedicated funding solution. Does this last us FY28 or no?

So then FY28 forward, if we use that in 27, we'd have to be paying back in at a higher rate in the future. I think that's probably a good discussion with the charts in front of us so we can sort of game that out with full transparency. I think that It's important for people to understand how that fund works. Um, and another Metro question. Let's say the state totally fumbles the ball on Metro funding and they don't make the state contribution. That would be an FY28, right? Or would that potentially affect FY27? That would affect FY27, right? And that

for the operating, they were not projecting budgeting capital until 2018. checked how much that might be over and above what our current obligation is and I think that's where we can use the MBTC charts that um is being referenced because you could see where we're in the state piece and what the offset would have to be from the trust fund but if you take it out of the fund at some point you're going to have to put it back into the balance right so how much do we have an estimate as to what that cost would be now this is really worst case but it's where we are today

yeah we can provide further details, but when working with the staff, we we felt comfortable enough even with the worst case and and this was maybe a month ago that we have enough funds uh at least for the next few years uh to be isolated, but clearly the more we draw upon it, the more risk we're at for future years. So, but we can provide the details.

Okay. And then with regard to the jurisdictional contracts, um can they can they up and can are any of these contracts capable of being increased midyear or are we contracting for a year and once we have the number for next year it can't be changed midyear. So you have stated before that these big contracts carry some risk for the city. And so the example this year is an example of that risk where Fairfax County kind of did an audit of how they were billing the city and they they discovered errors and now they're billing us for those errors to make up for it. And um so that is a risk that we can't say is zero. Um but we do manage these contracts very closely and um and we try to minimize the surprises. Surprises are bad in J contracts. We had a bad one this year

and so that is a bit of a lesson I think to all of us that um even when you do manage them closely sometimes you can have some some shocks. So I mean I'm not really answering your questions because there is generally speaking let's say if well will well gas goes up yeah can midy year even though we've established the price at the beginning of the year for the services can they pass that on? Yeah. So most of them we're paying based on their budget and then we pay a proportionate share based on our population. That's the normal model. There are some

uh exceptions to that. So, we should be protected. You know, we're assuming uh uh that number should be set for FY27 absent uh our interjural jurisdictional partners doing some sort of an audit and finding an error and sending us a bill. Okay. Wait. So, Mr. S, can I just ask a clarifying question? So, so the we knew that the Arlington contract because we went through that, right, and signed that, we knew that was going to jump up, but the Fairfax one was the one we were not anticipating.

Well, it jumped the, you know, the Arlington one jumped up because of the compensation package that it had been negotiating, right? And so, um, that's another risk that we don't have. We're not participating in those negotiations. We just kind of receive it when we when we get it. And that's not entirely predictable for us. Um it it is predictable for next year, but what it will be for FY28 is uh is uncertain. Thank you. Sorry, Mr. Schneider. Go ahead.

All right. Thank you. All right. Uh so moving on to the next slide. Uh this one just more provides the I believe the 10-year historical uh view. I I believe that this is a a table that has been provided in years past. Uh but again the numbers are are the same as the previous slide. So I'll move to the next one. Um so in this slide here um so within the budget that we had for our FY26 um were able to uh fund most of these services. The only one, as I had mentioned before, is the Fairfax Homeless Shelter. That one we're just unable to within our own budget uh be able to fund. And so, uh we're requesting uh that we will be coming to council in May uh for a budget amendment uh for the use of contingency to pay for the uh the Fairfax homeless shelter bill. Uh outside of that, there are a few notable items here that I would like to highlight. Uh starting with the executive management uh we are projecting to be over budget by 42,000. Uh and this is directly associated with the executive search firm that uh we will be pursuing for uh Mr. Mr. Shields um replacement. Um the next item that we have here is in uh DPW uh public works. Uh we have about $150,000 that we're projecting uh as well to uh related to the primarily due to the snow uh costs. And so that's uh where we'll need to rightsize their budgets. Uh and lastly on the treasur uh close to $50,000. Uh so a lot of the good news with the commissioner of revenue finding all the personal property tax uh for vehicles uh

the treasur's department has to uh get the bills out. Uh there was also some changes to the benefits which were not budgeted for and so as uh people uh come on to the the city's benefits there was an increase there of expenditures. Um and so those were some of the primary drivers of what was increasing uh the treasures uh expenditures. So we are projecting uh at the end of the year to have assuming uh contingency is used uh about $171,000 uh below budget heading into the end of this year. So I believe that is the last of the slides.

I ask one question.

Yes. Um so so just just on this contingency again I and I only asked because the staff report talked about it in three different places and it was use for the health and human services the you know the homeless shelter the energy costs and then the third place was legal and so I know we've used a portion of it on legal already and so was the reference to legal retro retrospective or was the reference to legal an anticipation of additional need for funding for legal in some way or another and then how does that get reflected in the 171 that's left? Yeah. So in terms of the legal that was a retrospective I think uh at the time when we presented in the budget January budget amendment uh about 200,000 for legal uh they had already uh hit their uh budgeted amount and they were requesting the 200,000 for services uh from that point to the end of this year. So it's a one-time uh funding request using contingency. Uh the second item was related to the facilities assessment and so that one we are doing a joint facility assessments with the schools and so that was about 50,000 that we had requested um to council and so we're requesting for the uh remaining balance uh to be used for the Fairfax home shelters. So those would be the three items uh in terms of the usage of the contingency for this year.

Right. So you're So the staff report when the staff report was talking about those various things, it was talking about those things overall in fiscal year 26 capturing like how how the contingency ultimately had been used or you predicted will be used and not necessarily the expenses you projected still through end of the fiscal year. Correct.

Yeah. Okay. Got it. Thanks. I just um you weren't here when we did this, Mr. So, so I'm going to direct this one at Mr. Shields. And that is just that the conting right now the contingencies 400,487, but didn't we put $500,000 in there last year? There is. So there was an appropriation of contingency back in November. Was that the legal fees? Legal fees and the facilities assessment.

So we reduced that right there. Okay. But the but also when we voted on that I remember having a conversation from the deis that we were going to make that contingency whole by the end of the year that it would remain with $500,000 in it if it was needed. Does anyone else remember this conversation? Yeah, I mean we were we had the conversation and then we were going to re-up it and if we had like revenue surplus revenue then the idea was that it was actually supposed to replenish the money we took out from the contingency because the that contingency wasn't used for the reasons we had actually first budgeted for the contingency.

Right. So I'm just a little grumpy about this contingency because I feel like it was set aside specifically for people in need which homeless services. Okay, that counts. Or revenue shortfalls. And then it shrunk to 400 because we were paying legal fees, which was something that needed to be paid for within the budget. But the point of the contingency was not to fill plugs in budgets in that way. So that's the part that is frustrating to me is that we set it aside specifically for a purpose and it it's getting spread out into other things. So going forward, if we're going to have a contingency, and I don't know that I really want us to have a contingency, but if we we're going to have it, we need to be a little more specific about what it's for. And again, there were so many unknowns this time last year, right? We just didn't know. So we wanted to make sure we were covering ourselves that way. So that one just is that's just a little frustrating to me that we've ended up in this place with this contingency.

And I would say also, Mary Beth, I agree with you on that. And and I separately asked about the contingency and I you know what would mean with replenishing but I also understood that the contingency has essentially been carried over like to now count like it's been absorbed into the operating budget to now pay for what is this overage or the cost of services including the homeless shelter services like going forward. So parts of the contingency have been operationalized in a different way in thinking about contingency as revenue going forward as opposed to contingency as contingency if that like if it's a fair way to represent kind of what occurred with the contingency.

Yeah. And to put numbers to it, you know, you had a $500,000 contingency, now you have a $260,000 contingency as proposed in FY27. So 240,000 has been put into the operating budget. I would just give a plug that, you know, contingencies are good for uncertainty. You know, I think it's actually good not to try to pre-program it. And in a you know I will share kind of what was in my mind uh about a value of the contingency was thinking about uh possibly having real revenue shocks and that this was going to give us room to maneuver in developing this year's budget. And this year's budget did have shocks. We had a million dollar uh decrease in investment revenues and we had a $ 1.5 million increase in IG contracts along with a whole lot of other 2.5 million in total of of contract shocks in general. And um we worked really hard to minimize those, but at the end of the day having 240 $260,000 of sort of a shock absorber in this year's budget was very helpful. And so I would encourage council to keep some for FY28 as well.

So Mr. Shields, is there a way to designate some of the money that's in the capital reserves in its own little separate account as the operating contingency rather than keeping it in the tax rate? Because that was part of my frustration last year is that we were putting almost a penny in the tax rate for contingency. Is there a way to do it so it's not in the tax rate, but it's still there in case it's needed?

So, one, I think we should be very acknowledge right off the bat there's a cost to the taxpayer of having a contingency, particularly one that's $500,000. That's a big deal. And the kind of the bargain was to try to avoid a real shock to services or a big shock to next year's tax rate for the taxpayers. And so, um, that's what we were mindful of. if you move it out of the tax rate and sort of cut the contingency to zero. And council has adopted budgets with no contingency in the past, um it it uh you lose that benefit for a very difficult budget the next year. And that's to me worth holding on to. Um just knowing how hard it is. Let's say assessed value grows only by two and a half% or is flat completely and the schools come in asking for a 3% budget increase and you have a whole lot of things you need to do. Having some sort of room to maneuver in those difficult years is very helpful.

It's an ideal um as an alternative and we had talked about this offline just to share with the full council. Could you have uh kind of a contingency that is sort of a slice of your unassigned fund balance using unassigned fund balance is kind of a big deal. We try to avoid that at all cost. You could have a rainy day fund on top of your unassigned fund balance that you have more access to. Um but that just means that at the end of the year you got you have to replenish it. And so if you're going into difficult choppy waters, you're not going to replenish it. You're not going to want to replenish it. And that's the that's the shortcoming of that kind of a contingency.

Uh Mr. Shields, real real quickly, uh because I'm one of the newer members. Can you give me an example of when we had to dip into the unassigned fund balance? Has that happened in recent years? It did. And it happened quite dramatically in that 2009 2010 time frame where we had the great recession um and we had a lawsuit where we had to make a big payment from the general fund to the water fund to make up multiple years of having taken a return on equity from the water fund.

Okay. So that drew our unassigned fund balance down to a very low level about a million dollars. And we then spent a decade working very hard and having very difficult conversations with the community about restoring that and ultimately setting the stage to be able to do the big capital projects. So we spent a whole decade kind of recovering from that and rebuilding our financial condition to be able to do city hall library and meridian high school. Okay. Thank you. And to approach the agencies

and to be able to go to New York City and sit down with the bonding agencies and and u and get a AAA bond rating. So it was um good work% more than our operating budget, right? It was uh very good work by the city council but also very controversial at the time and very difficult. Every one of those decisions to make those to strengthen our financial condition was a very contentious decision that the council had to make oftentimes in the face of big public hearings where people didn't like us doing that and so it wasn't easy.

So on the question of where should the contingency best live, I guess we're not the only jurisdiction that is trying to like figure this out. Um having looked at other budgets, I think others put it in their operating as well. At least Arlington has a small contingency. Do you all know like how our peers handle this?

I couldn't cite numbers off the top of my head. I I uh but we can find out. I would say it's I I feel it's important to have a contingency of some sort depends upon the year how much because it also provides a backs stop for during the budgeting process for your folks so that they know if they go exact if they go exactly where they need to be there's going to be a little bit of a backs stop for them. So they're more likely they're going to take that hard look at the budget. I think if we don't have the contingency, you this is just human nature. You're going to start getting a little bit in each of the subbud sub areas and yeah, we won't get overages, but it ends up being more than the that little float ends up being more than the contingency and it ends up getting used. So, I think having a little bit of a contingency helps with human behavior e even if they're not aware of it.

I mean, I to jump in, I I think that's a great point. And from an operating budget perspective, because we have fewer vacancies than we've had kind of in previous years, that was a natural, you know, source of that kind of flexibility that Mr. Agan's talking about that is is harder to do these this year than it's been in previous years. And so um so I think the contingency does serve that purpose.

Meaning we used to use vacancy savings as like your buffer like should we have unexpected expense we'd say oh this we haven't filled this position yet let's use the salary savings from that. Yeah, it gets sli if you don't call it out. I think it gets slipped in a little bit of in different places and we end up paying more and we've recognized that and and we have about 3% vacancy right now which is our old normal. sort of a preandemic normal and we had several years of 10 to 15% vacancies which was unusual but it allowed us to cover a lot of costs um as things came up through the years. Um so we don't have that anymore and it's kind of another argument for having a contingency. One maybe one last thing I'll just note in this year's budget that's before you we've defunded um seven positions. we've added two back in. So, the net really was a five positions lost to the organization. Um, but that use of vacancies now is sort of going into essentially into the tax rate or into the operating budget. And that um is something we were able to do this year, but al that is at a 3% vacancy rate. We won't have that option in FY28.

Filing these all these things away about what we should worry about in FY28 Metro not having vacancies, whether assessed values will hold the way they have been. There's there's a lot of worries out there, I think. Okay. Thank you. Thank you, David, for the update. Are you ready to transition to the work session on FY27? Is there anything else on the state? Do you want to talk about state, Cindy? Sorry. Nothing's changed since the budget finance, but I'm glad to do a quick summary if you'd like it. Would anybody like Cindy to recap?

All right. So, the general assembly is convening this Thursday, April 23rd, for the special budget session. They will gavel out and then go back into recess because currently the House and Senate conferees have not come to an agreement with the conference budget to put forth to vote on. Um a lot of those issues are related to the revenue and that is the difference between the Senate and the House approach to um the revenue and as you recall the Senate wants to do the data center sales and use tax exemption and take it away and put a billion dollars back in sooner than it was planned for. The House uh did not agree, so they didn't get to an agreement. Um and then with the 180 bill amendment that the governor um sent back to the general assembly, several bills were vetoed that would have brought in additional revenue. So right now there's tension between the house sen and the governor to get to a negotiated budget. Um so it will need to happen by June 30th, but it hasn't happened for this week. And so, as I mentioned at the general at your budget finance committee, um I do not see the state having adopted budget by the time council needs to adopt your budget on May 11th. Um because they haven't reached agreement on the um revenues, there's been no discussion on the expenditures. So, that leaves us with unknown things like the transit funding. All anticipation is that there will be at least the operating budget in Wato operating budget in there to hold us over since I didn't get to the DMV moves but do not have a guarantee and so as we discussed that's why the MBTC transportation trust fund might be the backs stop general assembly is also convening this Wednesday to review the

amended bills and vetos that came back to the general assembly. So over the next couple weeks, things will be evolving, but it's no known facts right now. That was a quick synopsis of what we did on Friday. Thank you, Cindy. Guess we'll stay tuned. Anything else on current stuff before we talk about FI27?

Okay, I think we're ready to transition then to the next thing. So, um, so for the school board, uh, there was a letter that was received at five o'clock and, um, um, so I don't know if there wants to be any discussion about that. We don't have the school board here with us tonight or at least we didn't. Um, we do have public safety here tonight and so if the council wants to talk sort of big picture or would like to um spend some time with public safety staff first and then maybe talk big picture after that. I think given that we have police here with us, let's let them join us and then we can let them go home. All right.

You're welcome to cupcake. So, Chief Fart, I'll turn it over to you, sir.

And while he's getting organized, uh we're joined at the table by Peter Haniff, who is our uh uh leading uh a lot of good things in the department, but he'll be here to talk about the accreditation process, among other things tonight. And uh so, Chief, I'll turn it back over to you. Thank you. Uh good evening, mayor, vice mayor, and members of council. For those watching uh from home, my name is Sean Farard. I'm the director of public safety and chief of police for the city. My team and I appreciate the opportunity to engage with council on the proposed FY27 budget. But tonight is not just about FY27. It's about laying out a clear and transparent picture of where the police department stands today and what it takes to sustain a modern, professional, and accredited public safety organization in the years ahead. Uh I have about a dozen or so uh slides to go through and certainly I can take questions as we go, but I think it may be helpful to uh um get the questions at the end after I go through them, but I'll leave that up to council. Uh before we get into the public safety budget, if you'll allow me, um I thought this would be a good opportunity for me to provide you a preliminary crime data for calendar year 2025. Uh we typically publish our yearend crime data in our annual reports and the 25 annual report is yet to be completed. when it's ready, and we've done so, as we've done so in the past two years, I'd welcome the opportunity to attend a future council meeting to present our annual report to the community and answer questions. Again, while these figures are preliminary, I'll take a minute to provide a brief preview and state of crime in the city in 2025 calendar year. So, I'm happy to report that at 2025, crime totals in the city were down by 1.17%. And I'll highlight the fact that there's

a difference between how many offenses or crimes we've had and how many actual incidents we responded to that generated those offenses. So without getting too much further into the weeds, the number of incidents, these are not offenses in 25 increased by 4% compared to the year before in 2024. Again, one incident or call we respond to can involve more than one crime or one offense. Additionally, the city's per 100,000 population crime rate as captured by the state saw 8% reduction last year. I should note that last year's crime rate is the lowest it's been in the city for the past 17 years, which is the furthest I can go back in looking at the data on the state's website. And it's probably more significant to highlight the fact that the population in the city has increased over those years while the crime rate has decreased. Last year's violent crimes were nearly 7 27% less than in 2024. Crimes against persons were down by 21%. While property crimes went up slightly by 1%. So I'm happy to report to council on the community that false church remains a very safe community. I think the history of public safety budget matters to our conversation tonight and as context for the department's immediate and future needs. Going back as far as the great recession, as the city manager um alluded to a little bit ago and moving forward, what I see in the historical budget documents is a department with staffing levels have have remained relatively stable while expectations, complexity, and service demands have increased. Considerably, policing has evolved. It's evolved from a reactive response model to a model requiring datadriven policing, technology, and accountability. the

demands for transparency, ethical accountability, immediate responsiveness, social media, bodywn cameras, 21st century policing, coupled with increasing changes to the technical aspects of digital forensics, AI, cyber crime, predictive policing, drones, and honestly, police have become the first responders for societal failures in handling mental health crisis, unhoused population, and addiction related incidents. I'm old enough to have been a 911 first responder and I know all too well the need for public safety to also be ready and vigilant to respond to risks of international and domestic attacks. Policing has certainly evolved in my 30 years in this business. And while I welcome the increased scrutiny and accountability which only makes us better, the fact that the environment has also been coupled with negative public perceptions of the profession which has presented all police departments with recruitment, hiring and retention challenges. So in the context of increased policing expectations and complexities, the resources needed are really in two simplified buckets. the service delivery bucket and the transparency accountability bucket. And through these years of police reform and increased expectations, we see mostly flat budgets with the department absorbing cost increases or doing more and more with less and not always very well. I think this is an important context because much of the unmet needs we'll share with council tonight is a culmination of years of deferred unmet needs that generate risks to one of those two buckets. Service delivery, transparency, accountability. I know that was a little bit somber. So let me say that even with the deferments, the false church police officers of past and present, the police

leaders of past and present have done amazing work with the provided resources and keeping this community safe as it has been and contributing to the fact that the city continues to be one of the most desirable places where people want to live, go to school, and spend leisurely time. In fact, last year's Pbolski community survey, 86 and a half percent of the respondents reported their satisfaction with police services. While dissatisfaction rates decreased from the 2023 survey, we're in a very strong position. This police department has established a uniquely strong community bond built on trust, engagement, and commitment to public service. Despite re retention, recruitment, and hiring challenges I highlighted in the last slide, I'm excited to report that we've been able to move the needle on our vacant positions and are now nearly fully staffed. But this has not been at a cost or without cost. Without the required support staff and resources, my time, my command staff's time, and our officers and detectives times are spent at administrative tasks instead of focusing on crime, traffic, and safety. Yes, we're nearly fully staffed and that's great news, but the risk of falling behind again haven't been mitigated. Having wrapped up two years as a police chief here in Falls Church, I often get asked by friends and former colleagues about the people in the department. I share with them as I am here that the false church police department is an engaged team who have deep respect for one another and for the community. Our leadership team who are here with me tonight engages proactively with our members to involve their expertise in developing and shaping our team culture. We believe that our healthy culture and the support of our community are the secret sauce to our positive retention and we know that has

contributed to a certified to certified applicants being drawn to us from other jurisdictions as recently as this month. We don't take our culture lightly and we're very proud of it and anytime I get a chance to talk about it, I like to do that. I want to remind council that during the fiscal year 25 budget work session, we discussed questions around required police staffing figures. We discussed a misnomer around the one officer per 1000 population model with a relic of 1950 style budgeting that fails to account for the reality of modern policing. We discussed the need for to study the police department's workload to determine necessary resources. So, I'm happy to report that a consulting firm, Matrix Consulting Group, have been contracted by a city and are actively conducting their evaluation of our department as we speak. This study will measure actual time officers spend on calls versus proactive policing. They'll evaluate deployment strategies, civilization opportunities, examine spanner controls and our structure, provide further uh future growth projections and recommend 21st century policing alignments. Their work involves internal engagement and community engagement which are tenatively scheduled for the evening of Thursday, May 14th and during the day on Saturday, May 16th. The final report is due in July or August and will include a public presentation of their findings. Afterwards, we plan to engage with the city manager and council on the next steps that are based on their findings. Finally, we continue the important work of advancing through accreditation, strengthening policy and accountability. As the city manager already introduced you, I would also like to take the opportunity to introduce you to Mr. of

Peter Haniff, the department's professional standards manager. This position was added this year in FY26. Peter joined us in November and uh I know city council is interested in an update in our accreditation progress. I'll ask Peter to provide an overview of his professional background and of the department's progress in attaining national accreditation goals.

Thank you, Chief, and thank you for the introduction as well. Um so my name is Peter Hanov. Chief Art mentioned, I started here back in November. Um, my background is previously working as an uh attorney doing civil rights and criminal law and most recently doing policy work for a national organization that worked on policing policy. Um, so I wanted to give a quick overview of accreditation and the work we're doing here. Um, so starting with the benefits of accreditation. Um, do you have the slide before or if I could go backwards? doing that. Thanks. So, I'm sure as you all are familiar with already, I just wanted to go quickly over the some of the benefits of accreditation. The single biggest one really is risk mitigation. Um, so accredited agencies face less risk from obviously litigation and the financial cost that comes with litigation, but also reduced risk of incidents that result in injuries, accidents, uses of force or other negative outcomes. Um, accredited agencies generally also have uh better trust with their communities. Um, that's already something that exists here, but it's able to be sustained and continued um through having that accreditation. Um, a lot of that community trust comes from knowing that the department is accredited, but it also comes from the improved processes that result from going through the accreditation process. Um, so that results in improved service delivery to the community by having more consistent practices followed by our officers that are consistent and in line with national best practices as well. It also contributes to officer wellness and morale. Um, it creates that healthy culture that the chief mentioned and sustains it for an ongoing term. Um, which again can help with turn staff turnover as well. Um, most importantly on that risk mitigation side, accredit going through that accreditation process really allows the department to identify gaps and weaknesses before they emerge through some unfortunate incident or

other um way that we don't want to learn about but catching them in advance. So when Chief Hard created this role um a lot of other departments that I've worked with in the past and in this area tend to have someone in a position of an accreditation manager. Um I think chief far wisely wanted this to be a position that worked on both accreditation and policy. Um and the reason for that is department policies are largely driven by accreditation standards but they're driven by a lot of other factors as well. That includes legal compliance, best practices from national guidance and from local agencies and the specific needs of the community as well. Um going through that accreditation process as well allows us to identify issues that are outside of the scope of the accreditation. So we may be reviewing a policy to come up to compliance with an accreditation standard, but as a result realize that we're not meeting some goals that meet 21st century policing standards or specific needs that the community has identified. Um by having kind of this accreditation policy work happen in one position under one roof, it also allows for a more consistent approach to this work. So we're not modifying a policy with one goal one day and with another goal the other day, but working on it consistently creates policies that are easier for officers to follow and understand as well. And I know I've talked a lot about policy, but the accreditation process, policy is really just the first step. Um sometimes the harder work is putting that policy into practice and making sure that it's actually followed. So that's a matter often of communication um education and also continued oversight and monitoring as well to make sure that these actually go into practice. Um and what makes the accreditation process so valuable but also so labor intensive is accreditation is a check not just on policy but on practice as well. So these national accreditation bodies come in and don't just want to know that your policies are in line but they look at years of

records to make sure that we're actually following those policies as well. So, in the relatively short time I've been here, um I want to go over where what the department is working on now and has done so far. Um so, of our policies, which includes general orders, standing orders. We also have memoranda that go out to officers. Over 40 of our policies have been updated and published or are currently in draft form and we're working on many more in the near future. Um it's also given us a chance to formalize roles and responsibilities within the department. um as a smaller a relatively smaller agency and I'm sure like many other city departments as well uh officers wear many different hats have many different responsibilities so making sure that we identify those document those and formalize that roles allows the department going forward to uh deal with turnover or moving to different assignments within the department um more smoothly um through this accreditation work so far we've been able to build relationships with other neighboring agencies um with national policy professionals as well and importantly within the city. So as we're going through certain policy updates, we're talking with emergency the office of emergency management, parks and recreation um to figure out whether our policy updates also reflect the processes that they engage in and whether the department is engaging with them in a way that's helpful as well. So just very briefly, I apologize for the small writing here, but uh KLE, which is the Commission on Accreditation of Law Enforcement Agencies, this is the national accreditation body that that we're following. Um generally have a three-year process for the first accredit first time the agency is accredited. Um so we sign a contract in late 2024, which means that we expect to achieve our accreditation by the fall of 2027. So, right now we're in that early process of early and ongoing process of bringing the agency into compliance. Um, and expect to have an on-site evaluation sometime next summer and assuming that

all goes to plan would receive that official stamp of firsttime accreditation next fall. Um, and I'll note that this is for the first accreditation, but accreditation is not a one-time process. This is an ongoing thing that we aim to maintain and improve upon as as we go on. I'll hand this back to chief. Thank you.

Thank you, Peter. So, I have uh three more three or four more slides. Um I want to just start here by just taking a few minutes to recognize the return on the many public safety investments that council has made and the many accomplishments because of those. Over the past two fiscal years, council supported three new additional police officer and two emergency communication technician positions, which is helping to stabilize our operations in those uh areas. Two of the three officer positions have helped stabilize shift relief factor gaps within half of the patrol operations. Uh with a third officer position has allowed us to create and fill a training manager position. And if you recall, that was a recommendation of the use of force review committee from 2021. And the dividends in staff professional development and succession planning has been profound. Uh, Captain Henderson is with us. She just graduated from the police executive leadership program with the VACP down University of Richmond last week. Um, and there's many, many more examples. Uh the two additional dispatcher positions are helping us bolster staffing and dispatch uh during workload peak periods and it's bringing uh much needed relief to what has historically been a single person operation performing multiple tasks without relief during 12-hour rotations. In fiscal year 2025, I discussed these positions and dispatch with council and we'll remind the community that these individuals are typically the first team members the community interacts with in law enforcement here in the city, whether it's via the 911 calls we receive, regular phone calls we get, or the walk-ins to our facility. Additionally, this fiscal year, a significant council investment was made in the department's bodywn camera, incar camera um systems along with radio systems, and these programs have certainly enhanced transparency and accountability. Council investments in technology has

allowed us to upgrade the department's mobile computer terminals, MCTs. I have mine here in front of me. uh to a point where now where all of our officers are issued an MCT or laptop that goes everywhere they go, we go. We also upgraded the laptop docking stations and the police car so they're all uniform and sworn managers like you see uh in this room uh with office spaces including me. Uh we've now gone down to a single device which uh saving the city uh it thousands of dollars of um uh revenue that would otherwise be expended for needing to uh replenish multiple devices to issue to one employee. So those are invest in investments that's not only improved operations but it's also coupled with efficiency and long-term effectiveness. Our traffic safety operations and education programs have a long way to go, but we have seen improvements in the police department's approach to traffic safety. Hopefully, council and the committee have seen that. No longer is the case where the department is only focused on traffic stops, but now we've implemented improved data collection, data sharing, improved policy and practice around crash re investigations, and have ongoing collaboration with transportation engineers, city planners, community groups to bring about the council's direction of vision zero. We're working to implement an electronic traffic citation program to digitize the current system which will bring both operational and administrative efficiency and effectiveness. We're implementing an automated work scheduling and workforce management solution which will improve management of minimum staffing requirements that we have in public safety with many many other benefits of a modern digital public safety work schedule tool. In the past two years, we've added or reinstituted many community engagement programs with the Community Policing

Academy being the most talked about. And I'm happy to report that on Friday, we announced the application period for the second session of the Community Police Academy, which will start in September. And applications being submitted right now are accepted through July 15th. And also I want to announce tonight that we're rolling out a new prescription drug drop off box soon which will be in our lobby and the community can use year round which has shown to save lives. All of these community policing programs are occurring within a centralized community support section which we created last year to bring together many functions that need to support one another. By doing so, we've also improved supervision ratios or also referred to Hispanic control so that team members doing this important work have the management uh support they need when they need it. These functions include public safety aids and I'm happy to announce all those positions are now filled. The traffic safety function, the school resource officer function, community support functions and special event planning. Finally, your support of the proposed FY27 market rate adjustment for non-exempt sworn staff. These are lieutenant sergeants and officers is critical not only for regional public safety competitiveness, but also retaining the staff we made so much investment in. These accomplishments don't happen without council investment and we uh know that these are foundational to the safety of this community and want to thank council for that. So when we get into the FY27 budget, I want to highlight the budget directions that the department received and used to prepare its upcoming budget. As was the case with other departments and their directors, we went into our budget development process with a fresh disciplined look at our non-personnel

expenses. We built built those programs budgets from the ground up reviewing major contracts and ultimately making up for some of the FY26 and FY27 contractual increases that had existed and to uh and at the top of the priority list for this year was addressing that competitiveness uh in the market that's been created in region starting back in November when Arlington County Police Department announced that their starting salary was increasing to $90,000 per year which has resulted in many agencies in our region adjusting their starting salaries. The last time I spoke before council on this topic, I mentioned that we were working with the manager's office on the matter and our HR director did complete a survey of competitors uh police department starting salaries. And with the information available to us, it was obvious that without an adjustment to our current police officer starting salary, we would be less competitive and run serious risk of losing officers to other area agencies. The proposed adjustment has been received positively and demonstrated the support of this council and the community. While there's been progress within the uh proposed FY27 budget to close police services cost gaps, the police department continues to have immediate personnel and non-personnel needs that have compounded over the years with council. And while council has asked for me to share that information with you, I'm going to do that here. As mentioned earlier, the negative effects are either in the service delivery bucket or the transparency and accountability bucket. These unmet needs are not the result or effect of a single-year budget action. They reflect multiple years of relatively flat budgets. While the mentioned policing expectations and complexities have grown over time, this has created gaps that will take several

budget cycles to get ahead of. In your packets, you have a copy of an internal memorandum titled FY2027 unfunded needs list that coincides with the information on this slide. Within the memo, there are detailed explanations that support the niche need for each item. So, I won't go through each one of them and so I can leave time for questions at the end of the presentation. Um, but if you'll allow me, I do want to uh highlight a few items on the list that I see critical to our ability to uh deliver uninterrupted police services to the community and continue to meet the community's expectations around transparency and accountability. At the top of the list is the status of our fleet. Our fleet situation has reached a dangerous point. Police cars are much more much more than means of transportation. A police car is one of the most critical tools in our equipment inventory. For a modern police department, police cars serve as a mobile command center, a proactive and protective barrier, prisoner transportation, and primary traffic safety deterrent and crime deterrent. The public safety fleet situation has deteriorated so much that we have operational positions without vehicles and recent examples have shown the impact of is affecting our response and service delivery capacity. While we've done some uh we've taken some strides, more is needed to correct the years of falling behind. And what's required right now is a one-time funding to sustain and centralized public safety fleet funding is required so we don't end up in the same situation we're in now. I cannot overstate the issue on our fleet. Aside from the urgency with the fleet, immediate funding gaps exist with our overtime funding that's defined on page one of the memo. The two key support

staff positions are urgently needed. These are the foyer/pio position and the background investigation position. Finally, the technology funding gaps are needed to support transparency and accountability initiatives to create workload capacity for street officers and detectives, support fire service response readiness, and fulfill data transparency requests from the community and the council. These high priority needs aren't a nice to have. They are a critical need that I'm asking for your help in addressing. I fully appreci app appreciate the fiscal and priority challenges that have been discussed during this budget period and appreciate the challenges this creates for the council and the community. So, as I go through this final slide here, I'll reference last year's Pabolski community survey once again by noting that the respondents rated the maintenance and improvement of police services in the city as a high priority. I believe during my tenure, the council has made police services a priority and we've discussed the many positive outcomes of those investments, including the lowest crime rate the city has experienced while the city's population has grown. And looking beyond fiscal year 2027, I'm excited to receive the Matrix Consulting Group's final report for our operational review study this summer. I believe it will provide the community with invaluable predictive analysis of near future needs which we'll need to discuss after the findings are published. As mentioned in the previous slide, the department has gaps in key support functions which require specialized and often nonsworn support to ensure the business enterprises are maintained and advanced. I'll point out that the position uh the civilianization position opportunities within the department will also be something that's going to be

addressed by the matrix study. Just as is the case with our sworn police officers, recruitment and retention weaknesses and risks exist within our emergency communication center, which is a high stress and often thankless profession. I appreciate council's recognition last week of the public safety telecommunication appreciation week. For the fiscal year 2020 year 2028 budget cycle, I plan to elicit the expertise of HR and finance directors to evaluate a dedicated pay plan for our emergency communication technicians, which will help us stay competitive and consistent with other emergency communication centers. I've already discussed the uh status of our fleet, so I won't I'll leave that as is already covered. But I do want to highlight the fact that I appreciate the council's desire for datadriven decisions and we need to continue to invest in the everchanging hardware and software tools to support datadriven problem solving to be efficient and effective with delivery of police services. We still have a long way to go uh to get out of the manual data entry processes that provide little to no analytical capacity or the inability to share data with the community. I'll note and thank the city manager for his support in adding the topic of a dedicated public facility to the 10-year CIP schedule. I cannot overemphasize the critical nature of this project for both the safety of the community, our operations, and our staff. We have serious concerns that must be shared with the council and the community. In a recent internal survey, police team members expressed overwhelmingly that they do not believe the current facility effectively supports day-to-day operations. They highlight the inappropriate overlaps of public areas of and with what should be secured operational

areas. Almost all of them have observed or experienced security concerns in the building and the shared parking lot. Every Saturday and many special events on the city hall campus, the police department has to relocate vehicles and have limited access to the facility. There aren't enough locker room spaces. The team don't doesn't see the current facility as one that reflects the professional standards expected of a modern accredited law enforcement agency. The shared open parking lot situation I just mentioned conflicts with high stakes law enforcement requirements and is ripe for risk which has already been seen with the sheriff's car being set on fire a few years ago. The current facility is unable to support physical fitness training, defensive tactics training, meeting modern technology needs such as server rooms, cell phone reception issues, digital frames ex examinations. And not only staff don't believe that current facility doesn't meet current needs, but they don't believe that current facility can meet department needs 10 years from now. I implore council to take action in addressing the public safety facility of not only the police department, but the sheriff's office. Our office of emergency management and the fire marshall's office have been working in a trailer in the DPW parking lot for the last seven years without running water or a bathroom. These public facility needs require the same or greater level of priority that's been given to past, current, and future facilities CIP projects. Finally, while the city enjoys low-level crimes and rarely experiences violent crimes, there are other safety risks that need to be addressed. One example is the increasing level of financial loss being experienced by our older community members through increasingly sophisticated cyber crimes. The losses are skyrocketing and we have limited capacity to deal with more complicated criminal enterprises while

we're focused on upwriting foundational needs. I'll close once again by recognizing and thanking the city manager's office, my peer directors for their support to have this discussion and the council for their interest in learning more about the challenges we face in law enforcement and for your continued investment in public safety. These investments have impactful results. Thank you. Thank you, Chief. Sure, we have questions and comments, so wants to jump in.

Justine, thank you so much for that thorough presentation. Um, actually just following up on the last uh thing you mentioned uh because I was curious about that. Um, regarding the scams that you mentioned, I I would think that that would be something that would be a FBI uh level issue, but that's something that we handle locally, not at the national level. Well, it's a state, local, and federal level. So, we're the first responders. Uh, a lot of these cases are conspiracy cases, and usually one perpetrator has thousands of victims.

Yeah. and the reports and the preliminary investigations that we take on sets the framework and the groundwork for the state and federal authorities to be able to link these cases. Gotcha. Uh we do have things that happen physically in the city. So like for example, I've seen Bitcoin ATM machines start popping up in the city and we've already had one victim uh who's victimized by one of those machines. So uh that's more of a local issue. Okay. Um, so that it's really a local, state, and national um, partnership to address those crimes and sometimes international as well.

Gotcha. Okay. Um, so then I have some questions. Maybe some of these are directed at other people too. Um, with the pay increases that, um, we're looking at for this budget, has that been factored into the pension payments? And like how how I guess how does that change your calculations for uh retirement

for the November 2012 valuation? This was not on the table yet. So we just did the normal u assumptions in there. When we do November 2026, we will have to calculate in the salary increase for the police plan and any others. Right now, the current one that's on the table for all other employees is factored in.

So, it will adjust the employer contribution for the actuality determined contribution. But given that we're overfunded, I don't think you'll see a negative impact to the plan or an actual impact to the operating budget. Um, okay. But it could be something that we see in future years just happen to be overfunded right now. But yeah, and it feeds in it'll be smoothed in. So every year it'll be updated. Okay. It could based on investments up and down, right? Good question. Uh but so for right now there wouldn't be an increase to contributions from the employer.

Correct. There would not be an immediate impact.

Okay. Uh but but I guess still that's something that we would need to keep an eye on in the future. Um I was curious. So yeah, I was looking at in the budget Q&A, we had a list of entry level uh positions for the different um starting salaries in the region. Arlington's is incredibly high. I what I mean that is that is a major jump. So what what happened in Arlington? And uh because it looks like we now match pretty much I was looking at the list. We we do we're in the same general ballpark, maybe slightly above some of our our neighboring jurisdictions. Do we know if they're increasing their salaries even more or this is like what they're looking at for FY27? Um and then yeah, why is Arlington so out of sync with the rest of the region?

It's a good question. Um I think part of it is um the attrition that they've had and the uh gaps they have in their vacancies and this as a means to try to uh improve their recruitment and application numbers. Um part of it is around um collective bargaining. Some of the agencies that you see on that list are um have CBAs. um some of the agencies or jurisdictions have different abilities to adjust. Uhhuh.

Um so it's a I think it's a varied um issue there. Uh what's not on that list is also a competitiveness issue for us is uniform federal services. So US Capital Police, park police, and others uh have raised their starting um pays to over $80,000. My former agency has lost uh a number of officers to park police for example.

Uh huge huge signing on bonuses that we don't offer. Uh anywhere between 25,000 to $75,000 depending on the different agencies. So yeah, it's a very much a competitiveness issue that starting salary is really just one aspect of the conversation there.

Interesting. Uh, do we have any would you say that we have any advantages here just because we are I don't know. I would like to think like we're the little city. We're like a nice jurisdiction to work in. Um would you say we have any competitive advantages just because of um the setup of false church city versus let's say Arlington which I don't know you might not have as close I actually I don't know how Arlington or Alexandria work but where um maybe you don't have as close net of a police force or a community. No, I mean it's not just the pay, right? Uh the the culture that I talked about earlier in my presentation, I think that's a huge I I called it a secret sauce, right? There's a but

u there are a lot of studies, one just came out from National Policing Institute about uh how much of our recruitment and hiring challenges have to do with retention,

how much of that culture uh contributes to that retention. So I can't speak for other agencies. All I can say that a lot of our officers like working here because of our culture and they're our biggest recruiters. So the few um crossjurisdictional recruits that we've had um they're not because we're spending a lot of money marketing, they're our own officers recruiting them. Uh so the starting salary is important, right? Um because the gap you mentioned Arlington, it just becomes so huge that an officer that's been here for five years may be making less than officer going into the academy at Arlington. So uh none of our officers expect to make that much, but they expect to be uh somewhere in the ballpark as the HR director has studied that. Um, so yeah, uh, our culture, the community. Um, whenever I, uh, interview an applicant, I brag about our community, and I know that there isn't a week that doesn't go by that somebody doesn't drop off some food for us, right? That the mayor showed that tonight with with the cupcakes, right? That happens all the time in the police department. Um, gifts. Um, so the community, the support we have, council support, the everything that goes into it, I think contributes to it.

Great. Um, you mentioned uh retention uh rates. Do we have do you have information on like our retention rates, what they've been over the past few years. Um, and then also what you expect them to be going forward versus um, I guess Arlington was struggling with retention and Alex Alexandria and some of the other jurisdictions or two.

Yeah. The last time I spoke to council, I noted that over the period that I've been here, two years, we lost 16 officers and we hired 16 officers or 16 employees. That includes uh, not just officers, but at the same time, we're growing the department. I mentioned the five additional positions. So, uh right now we're nearly fully staffed. I have one police officer position and multiple applicants in their final uh hiring uh stages. Um we only have two nonsworn position open and one of them we've already extended a final offer to. So, okay,

we're doing really really well. The last time I think I spoke to council, we had a lot more vacancies, but over the last few months, there's been a lot of work by this team to um to make sure that we fill those positions. But again, that that culture attrition, we have a lot of internal conversations about doing everything we can so that we can keep our valuable team members.

Do you feel like uh I guess so we stand I'm looking at the numbers now. Um, so actually another question related to the the region. Do you know if that like especially for Arlington if if that like my gosh the 25% raise was that across the board? So what what we're looking at here is entry level positions. Um, do you know if they ra was it simply be to get the entry level officers or did they raise salaries from um middle to high level officers as well? And then are we what are we doing in comparison to what Arlington's doing?

Yeah. Uh, I'm going to get maybe the HR director's help up here a little bit because I she helped me do or she helped the city, I should say, do some of the research. But, um, I can I can tell you what what we're doing. Okay. Sure. Um, so we have a pay plan. Sure.

Uh, the structure of our play plan has always been there. uh we're adjusting our starting salary as indicated and then the structure in itself remains in effect. Um so that goes and that pay plan we're making those adjustments uh the market rate adjustments for our non-exempt sworn employees. So those are lieutenants and below.

Okay. And so Arlington is also addressing non-entry level police officers um at a higher rate. Um we didn't do that analysis. We don't feel at this point that that's you a most direct um competitive issue that we need to be concerned about. Um Arlington made a very decisive decision to be the pay leader. um and so they don't want to have competition for their um entry- level officers and it is impacting um on the federal side as well like Capital Police, DC um are all experiencing this. Um in addition, I think it was also mentioned they're going to be offering a $25,000 hiring bonus. So, we didn't get into that aspect of it. Um, we've strictly looked at where we could adjust our salary and still be competitive without necessarily matching.

Okay. Gotcha. Um, and so I guess uh from your perspective like you feel comfortable where we so we're slightly above Alexandria. I'm just looking. City of Fairfax is still pretty low. I'm just looking at the slide that's on the screen right now on your computer. Thank you. Uh, so we're we're slightly above I guess we're not above He H Hearnden, but we're slightly above the other um jurisdictions except for Arlington. Um, but not by not by much. Um, and you feel like that's a I guess steady place to be to be able to attract police officers. Yes.

An entry level. I do want to mention based on the collective bargaining agreements um Arlington's expires June 2026. So we don't know how that will impact the salary and um Fairfax County their bargaining agreement ends June 2027. So more than likely there will be another review along salary. Um how much if any will they need to adjust? I don't know. Okay.

But for where we are now, I think we're we're much more competitively placed. That FY27 salary that you referenced, that is where these jurisdictions are going to be effective July one. Gotcha. Okay. Um and so I just want to make sure that my understanding so that again this is for entry level positions um which is where the biggest increase is for all jurisdictions. Is that correct? versus like higher ranking officials. Correct. Okay. Um but in Arlington there was there were increases across the board just Okay.

And so we're somewhat matching what Arlington's doing but not quite. What we are doing is changing the entry level of police officer one. Okay. And what that's going to do for the plan itself is it's going to have to shift increases throughout. So we kept the model the same. So a 3% increase for each step. But if we're increasing the first step to 76, then the next PO2 has to increase proportionally as well. And between grades there's a 5% increase. So we stayed with the structure. Okay. But the compensation changed.

Gotcha. Okay. That that's that makes a lot more. Thank you for um clarifying that. Um, and I think I might have more questions, but I I will pass up my time. Thank you so much for going into detail about that. Erin, can I just I'm going to pick up where Justine left off. So, the so the overall budget effect that we see this year with the with the entrylevel salaries that recalibration is captured through the salary scale.

Yes. Okay. Um, great. And then there are other I'm going to kind of tick through a number of items just so that I feel like I can better like have a you have a lot of information here and then also just like a framework or plan of plan of um attack so to speak in terms of various unmet personnel and non-personnel needs. Um, and I'm and I also want to thank you, you know, for being here and for the city manager putting this on this schedule. I know that we, you know, wanted visibility into the police and public safety budget and so appreciate, you know, the presentation even though I know that you came up with, you know, your budget and did it through a collaborative process, but, you know, we obviously want to see what the police department, you know, in your judgment um, has as sort of unmet needs or what you feel are critical needs. On the accreditation point, it seems like we're on a path to accreditation. And so thank you for your work with that. What is the relationship between accreditation and sort of what you view as unmet needs? So is accreditation like outside of like it's going to look at staffing and it's going to look at ratios and it's going to look at departmental structure in addition to sort of all of these things because it's looking at best practices and standards. And so we're going through the accreditation process, but then when you look at the unmet needs, like how does that affect accreditation?

You want it?

Um I I think you know we'll we'll both take a take a swing at that. Um for me it makes it more challenging. Um for example I'm looking on the screen right now our IIA pro um that's a uh internal affairs software right so when we're looking at our internal affairs use of force data disciplinary data not having a program that can analyze the trends and the annual reports just makes it a lot more difficult and creates opportunity for errors because we're literally in counting those things. Um but you know there is um I think it just makes the accreditation process a lot more challenging because there are standard approves that we have to provide uh when the assessors come on site and look at our systems and the fact not having digital systems provides challenges there. I don't know if you wanted to add any more context to that.

No, I think that's exactly it. a lot of those challenges that you identified I think are the challenges that you're trying to address through the accreditation process as well or that it's looking for. Um so the technology side of it having those consistent processes um it's a lot easier to have that consistent process when you have the technology to do it. Um so I think addressing those needs will help us more easily come into compliance on the accreditation standards. I don't know if that answers

Yeah. No, that makes sense in in terms of it's kind of you're capturing you're capturing your information but you're doing it in a more like cumbersome way as opposed to the accreditation agency looking at it but then you also being able to to identify your own trends in yeah in real time as well. Yeah. Right. So I think both for accreditation and then like the chief mentioned moving towards a more data driven model as well um towards policing in general is something that you can meet through those.

And then staying on the technology point this first due platform. So there was a reference to it being grant funded and then it seems like maybe the grant funding lapsed. So, is it not usable because like the information in it isn't current or isn't helpful or isn't accurate, right? So, you shouldn't depend on it or sort like what what is the state of the program and does it just sort of need a slight reup?

The uh the program is fine. It's working. Uh we have a lot of uh um fire services data in there. Um, and it's just a funding for the subscription to the program that used to be grant funded, but that has lapsed and we've been funding it out of police budget and it's really a program under our fire marshall's u office, but but as of fiscal year 27 like so it's just legacy data in there or what happens, right? Like your grant lapsed. Oh, we're paying Well, so this is where we've kind of been when we look back. So we end up taking money from other places to pay for it. We have to maintain this software.

Um and so this is this is sort of this is reflecting both technology needs and then sort of like shortfalls that you're creating elsewhere gaps you're filling or like place where you're floating money so to speak. We're re designating or reallocating it because you need the subscriptions to continue but then you have holes. That's right. Where? That's right.

Okay. Um on on the facilities. So I noticed in the CIP and it may be a city manager's question. um we decoupled right for the first time seemingly in the 10-year outlook the property yard from the police facilities and we they're on two separate pages. And so before when we had sort of seen the you know preliminary schematics or we had talked about the property yard and sort of what uh updated property yard would look like and the emergency management sort of like functions and offices that you might want to like rehhouse in a Gordon Road complex is is the is the idea that if we were like doing the property yard and taking out x tens of millions of dollars of debt that the police facilities would be a part of that or by decoupling them in the CIP is the thought now that like they're two standalone projects that would be separately financed and like potentially housed in separate facilities. So, um, the previous property yard concept included nominal space for, I think, the emergency management function, but otherwise didn't address space needs for the police department at all. And so, that $30 million project was something different, right? and and I think the requirements that the chief's kind of outlined this evening and and is included in the 10-year outlook is another substantial, you know, investment for the city to contemplate when you look at the um what we've proposed in the CIP for FY27. Um and I forget the number off the top

my head. It's a hundred orund $100,000, $150,000 to do to bring in some consultant help to evaluate the property yard requirement, the police department needs, and then kind of the general kind of office space kind of gaps we might have kind of um in the city overall and help us think through a better jigsaw puzzle to put together those requirements in the most cost-effective way we can to meet all of the city's requirements. And so, um, so I think for purposes of the 10-year outlook, we've kind of identified both of those requirements, how we meet them, whether they're we get creative and we do something together in the Gordon Road Triangle. Um, anytime we would do something for the public works andor the police department, we'll free up space in this building. And so, how do you evaluate what you would do with that? I think those are some of the things like we want to spend some time and and have a more thoughtful integrated approach to bring back to council in a future fiscal year whether we have that in time for FY28 or FY29.

Okay. So we should so it's the additional page is because it's reflecting sort of more wholesome needs that may have that may have previously been sort of captured in the property yard concept itself. But the two pages don't necessarily mean they're decoupled versus so. Correct. Yeah. Okay. Got it. Yep. I guess I will say it's the first time I've heard so bluntly that we don't think our police station is meeting current needs or future needs. I think we've always thought about needing to invest in our the yard and then to take care of the emergency operations. But hearing, you know, what Chief Far just said is pretty concerning. Um and I don't obviously everyone has capital and and you know, space needs, right? So I'm trying to weigh that against other things that we are considering as well

and and that's why I asked the question like I just want to understand sort of the shift in thinking about the needs and what needs to be on our minds right and what we need to understand about sort of the range of needs across departments in terms of facility improvements or space improvements and um and so so I just want a clarification on that um on the fleet There are there there's the in information on the fleet. Um and then there are like a couple of contract authorizations or like there's the uplift or what's it called? Yeah, the uplift. Upfit.

Upfit. Yeah, I knew I had it backwards. There was like something I was like not something's not right about that. I'm getting it wrong. The upfit. And then there was the the contract that talked about the $350,000 and then a potential like $200,000 in fleet with correct fiscal year

additional appropriate funds. Correct. Is is the additional 200,000 in recognition of some of these fleet issues or need for fleet stabilization or fleet expansion or is that 200,000 separate and apart from the fleet issues that the chief identified? So the the consent preview items for contract authorizations or for you know to raise the So I think one of those hasn't come before council because we haven't spent up to the limit previously. And then the sheh he ford we we're we've reached the cap of what you all have previously authorized and so that's why that's back for you uh to approve and it's for us to use kind of some salary savings to buy a couple additional vehicles for the police department. So, um, we've used the base funds, you know, in the CIP to buy a number of vehicles across the city, but those three vehicles for so far for the police department. Um, our intent is to do an additional two. So, it does not address the full need that the chief's identified, but it starts to chip away at it.

Right. So, the so the non-personnel here with fleet stabilization and fleet recurring, like let's say it's a total of a million dollars, right? if I'm adding it correctly. Correct. The 200,000 that's in the contract I mean in the consent items tonight like would be addressing part of that million like it would be at 800,000 instead of a million looking at the slide as it currently stands. Correct. Okay. Yeah. More or less. I don't No, I know. But I just mean where is it and is it does it start like where's the match or mismatch or the connection or the disconnect?

And just a point of clarification, we're not expanding or increasing the size of the fleet. As a matter of fact, over the last two years that I've been here, we've decreased the size of the fleet. We had motorcycles that we no longer have because we didn't have any interest in officers wanting to ride them. So, we no longer have those. We've uh decreased the overall numbers. We've gotten rid of most of our V8 vehicles. We've purchased a lot more hybrids. Uh so none of the discussions we're having uh increase the actual number uh of the fleet size. Uh we do have a replacement cycle that exceeds some of what we see in other jurisdictions and we're not only have that in place, but we're also exceeding our own replacement cycle. uh because honestly I think the city has $360,000 in uh its budget and I'm not sure how many total vehicles we have in the city. It's probably close to 100. Um it's just not enough. It's not enough for the police department replace its vehicle program. So the um stabilization of one time is really to get us caught up to FY27 and the reoccurring in my mind is really a three to four car per year replacement cycle starting in FY 20. uh 8 to keep us um kind of up to date with our replacement cycle.

So you're okay with the current size of the fleet, but it's the need to the turnover. Yes. In the fleet. Think think of it as um this is a similar dynamic here to the the paving conversation, right? That's what this is. Okay. Um, while we're on fleet, because I had this later on when we talked about consent is could I get better understanding of what the replacement cycle currently is for us and then benchmark it to other jurisdictions and what we ideally like to get to because I know we talked about it as part of the go EEP at least for the broader city fleet. But as it relates police, if we are so underfunded, even though the 200 this year will help, you know, make a dent in that, I think I'd like more education on what

so the replacement cycle is. So we we can do a follow-up with some more specifics and you know I think from the energy plan work a few years ago our targeted replacement was for kind of standard vehicles in the fleet every 10 years for patrol vehicles which take a beating is six and that might be you know chief can talk more about that in a second and then for some of the specialties we were targeting 12 um we're not keeping up with that at $360,000 a year right that you know we've had some some one-time funding that's helping that's coming in that's helping the overall condition of the city's fleet with the the green fleet grant with public works has injected some new vehicles this year. But um the uh 360,000s short of being able to kind of meet that meet that replacement cycle.

Chief, you wanted to add something about some of the other departments? I mean the comparisons are going to be very very uh subject. there um state police, you know, mileage versus idling time, the size of the jurisdiction, whether you like normalize for 2.2 square miles versus Yeah. But I can tell you talking to um my counterparts in Arlington, they replaced their marked cars. So these are patrol cars every three years. We replace them every six years, you know, 10 times as big as we are.

As the deputy city manager uh alluded to, the patrol cars take a beating. And um if anybody wants to ride one in the front seat, not in the back seat, uh we'll we'll indulge you in that. And you can see I mean a three-year-old car, if you get in it, it's going to feel like a 10-y old car. So just up to recently, I assessed our patrol vehicles and over half of them were beyond that six-year replacement cycle. We had cars that are 11 12 years old. And I remind you that we talked about a six-year replacement cycle. So, it's all about that $360,000 figure. Um, it's also, you know, some of the issues we had around COVID and, um, sometimes we'll go to a dealer ready to buy a car and they don't have something on lot that we want and that delays delivery times. It can take six year, six months to a year from time of purchase to delivery. So, um, yeah. So, I I feel like the onetime stabilization amount that we've talked about, uh, it's about eight cars is where we need right now. Uh, that's not counting the ones that we've already ordered to get us up to schedule with that six-year, 10-year replacement cycle. And we have positions that don't currently have a car. Um, our deputy fire marshal position does not have a car and he has to borrow a car. Uh we recently had to cycle out some of our command vehicles including my car and push them down to patrol and some of our command staff uh members don't have a car. So this is why I say it's critical um that we uh right side the the issue right now.

Um can I go ahead? No. Well, I I just had a quick question um while we're on the vehicle. you know, when I was on school board, we always used year-end money, um, onetime money to replace two school buses a year, you know, and so is that something that that we've we could look to if we needed to, you know, if if the your budget, you know, salary vacancies, what have you, isn't covering it. I mean, that's something that we could look at, right? In terms of one one time revenue at the end of the year, I can tell you we have done that within my budget. Uh last year we used uh salary saving in the year to buy a replacement car for uh our K9. Mhm.

Um and that vehicle just got here. We ordered it last July. Um this year we had salary savings and we ordered two cars with salary savings, but that's out of my budget and it's usually limited to one or two cars. So I think you know I'm speak for my I mean you know when that time comes at the end of the fiscal year and we're looking at you know un revenue onetime revenue just communicate with you know through the city manager and and what you know if if you you know we could consider something even if it's you know one vehicle but if you like I said if it's just chipping away at it and I know the schools always do every year to try to do those two so they can keep moving it through and so I think just communicate with us when that time comes.

We will. Thank you. And Andy then on the on the because I started with you on consent on this $200,000. The way I read the additional 200,000 is that coming out of the projected year-end split, so to speak.

So there's um two things going on, right? So, and I'm I don't have it in front of me, but the $200,000 you're referencing doesn't click for me. So, so we're asking for contract authorization ceilings from council to purchase um vehicles and then outfitting, upfitting, whatever your preference is on on how you want to call it, costs for for uh police vehicles. We don't actually have money set aside to um utilize those full ceilings. We're just asking for council's authorization should we have the resources to do it. So, the chief's identified roughly $150,000 in salary savings from the police department to purchase two vehicles and the and and have them outfitted for the police department. So, um so the two contract authorizations before you this evening give us the flexibility to do those two vehicles and potentially some others should that opportunity materialize.

Okay. So, what I'm referencing is in the in the the she consent item on lines 8 to 12, it talks about the $350,000 that had been there. Council's now requested authorized purchasing agent to enter conducts with chief for additional vehicles up to an additional $550,000. So, that's where I'm talking about that additional 200,000 using any remaining fisc year 26 appropriated operations fund. So what we're saying that 200,000 is the VA vacancy or department savings that you've identified and the 200,000 like if there were 600,000 left and 300,000 of it went to general government in a revenue split you're not talking about 200 of those 300,000 already being spoken for. you're talking about 200,000 within the current police budget and then if there were end ofear surplus funds we could among other items determine if we were going to then do another fleet as part of that.

So this this gets into the I think the challenge we're trying to work through on these council contract authorizations, right? Because we're not actually asking for an appropriation of $200,000 from you all. It's money we've already got. Um I think of the for the two V you know the the specific numbers won't be exact but um the I think the cars c you know the Ford Explorers cost roughly $50,000 a piece to buy. So we're intending to buy two of those now and we would have ceiling left on the contract should we get to June and have additional resources in the city um to purchase up to two more. Um so the the ceiling's a little higher. So right now like we've got two vehicles I think reserved these ve you find them at the lot like the chief was referencing and they'll hold them for 30 days and so it's like oh great we've got two vehicles the reserve to give it to us now we've got to come back to council and go through this process and so we've we're trying to leap ahead to get the authorization out of the way so we could potentially do two more later. So the $200,000 right now on this particular contract we're probably only intending to spend a hundred of that. Does that does that make any sense? Um I'll move on to my last question which is on the on the

interaction between the multi-year initiative chief that you talk about in terms of these are the unfunded needs and you know your recommendation would that we would think about multi-year how do we address this because like where are we going to find $1.8 8 million in one year to address them. Um, and what is the relationship between that and sort of fiscal year 27 unmet needs and this operational assessment. So, you get the operational assessment essentially like day one of fiscal year 27. But if they're if you're not sort of predicting beyond your current budget, then it becomes a fiscal year 28 conversation. And we know from fiscal year like 25. We talked about staffing and rolling it to 26 and now we're in 27 and then we're in 28 and we still don't have officers we potentially identified as needing a few years ago. And fiscal year 28 we're talking about other needs including IT needs, right? And so when you think about what you anticipate from that operational assessment and you know from sort of professional judgment and expertise what you ideally would have in fiscal year 27 when we talk about the assessment I'm guessing that you're not you're not sort of thinking like oh we take this up as of fiscal year 28 and there are additional things on this list that ideally you would have in fiscal year 27 and not start in 208.

Yeah. I mean, uh, for fiscal year 27, the staffing for sworn officers and for our dispatchers, I think we're okay maintaining the level service. In fiscal year 25, I identified four sworn positions that were needed for our shift relief factors. We filled two of those positions. The city manager authorizes the police department for two additional overhires. So with those overhires, we can potentially count those third and fourth position to maintain shift relief factors, which does impact our overtime expenditures as well. For the dispatchers, we've had challenges filling those positions. We're I won't say we're almost there because the last time I said that I jinxed myself, but I think we're almost there. Um, and I think we'll be okay for fiscal year 27 sworn officer and dispatch position. Where I'm struggling with is that FOYA, that PIO position that transcends into our transparency and to our trust uh encounters with the community. Our FOYA numbers are going up uh because of our body cam videos that's vastly uh available. um these crashes that we have, usually the civil attorneys jump at, you know, the opportunity to get all of the body cam videos and that creates a lot of uh staff work hours that we just don't have the staff to do right now. Um the background investigation when we got into a hole a little bit with our sworn vacancies, it literally took us to nine months to dig out of it. That's because the people in this room, myself, and detectives and police officers, instead of running calls, working cases, they're working background investigations, and the turnaround time on them takes a lot longer. The HR director and I have had

conversations about that. So, having that half FTE position, whether it's a contract, part-time, temporary position, that's another key nonsworn position. But the matrix study report that's not just going to be give the police department more. I think it's going to tell the community how the police department can be a lot more efficient as well. Uh I'm sure there is efficiency issues that I need to address within my own department with the funding that we have. So I think that'll just kind of as we're going into FY27 and start the FY28 budget. Um, as I said, I want to look at a pay scale uh opportunity for the dispatchers uh to give them some predictivity for their career path and their pay. Um, but also uh we'll have some efficiency opportunity recommendations coming from a matrix study. I guess that a little because I had a similar question as Aaron is when I looked at this slide is knowing that you're going to have kind of your staffing study that might tell you efficiencies or you know pluses that you need to add to the organization like how much of slide 14 makes sense or what part of slide 14 makes sense as a really unfunded need versus just waiting for the results of it this summer and then thinking more holistically what that multi-year plan is to plus or subtract from things. Right?

So everything in a non-personnel side of that slide is an immediate need. Uh on the personnel side, that FOYA PIO officer and that background investigator position are top of the list for me. Uh now look, we've done without him for so many years and uh there's risks, right? So uh if everything stays the same, maybe the risk won't expose itself. But if we have something happen and we have a number of officers leave at once or retire, uh the risk with falling back in a hole with background investigations is going to present itself. The foyer PIO coordinator position is not going away. I mean that workload just keeps getting more and more and more. We talked about the scams, right? Our reactiveness to be able to communicate with the public is dependent on that position. Uh the city has a communication office, but we're not the only department. There's emergency communication needs that need to happen urgently and having that round of clock PIO um you know uh resource falls within that position. So those two positions PIO foyer position and the background investigator and everything on the non-personnel side for me um that that's not really based that's not going to be too nothing that's going to come out of the matrix site that's going to say you're not going to need those things. Matter of fact, the under the technology uh umbrella there, the community onlineing report, uh I would guess Matrix is probably going to highlight that because our community right now don't have the ability to report crime online like a lot of jurisdictions have. So the ability for off for the community to do that relieves our officers of having to go to someone's address and relieves that workload and expands their ability to dedicate that workload to more

proactive policing, community policing and other things that the study is going to talk about. Lauren, just quickly ballpark, what for those two positions, what would that be just ballpark? So it's in the memo. Um, so the because the the background is a 0.5, right? So the public information foyer coordinator we estimated at $120,000. Okay. The part-time background coordinator um we estimated at $50,000. That doesn't have to be a benefit position. It could be a temporary part-time or contracted position. Thank you. Erin, were you done?

Yeah. So I wanted to touch base on the PIO and the crime traffic analyst less so the background but technology has changed so much in the last six months year. Yeah.

You talked about the the foyer request taking up a ton of time and I understand that. Can AI step in to help with the redaction and the the identification of the body cam footage and help with alleviate that load to the point where this model would adjust and I look at the crime traffic analyst. It's is that something that could come in or

Yeah. So the the technology is already being used in some of the redaction and the body cam uh it's going to improve. So what it's going to be in a year from now I can't tell you but that technology is already used in our platforms. Uh so that's already there. Um what was your question about the analyst position specifically? Well, it's along the same lines is this technology is moving so fast is

yeah for for me the you know having worked in agencies where we have uh you know analysts it's the operational actionable information that the analyst can give you because they're integrated with staff they see the day-to-day operations as opposed to the two-dimensional reports that are generated by AI or computer program well I got to tell you some of AI stuff I've been playing with. Scary. Really scary. It is scary. And we also there there's a lot of ethical uh consideration around um entering some of our data into a uh machine that we don't know where it's going right now. So

yeah. Um now you mentioned the fraud and that's actually ties into that as well because that's moving the the fraud reports. Yeah. I mean, that's moving at that same speed where that's what the scammers are using. Um, and I have noticed looking at the police reports each week, there does seem to be more of those reports showing up in the crime report. Um, the just want to jump back real quick to the step increases and the increase in the salaries. Do you mentioned that the um we're using a 3% steps we're using a 5% for so where does that compare to our neighbors? Are they also 3% in steps 5% when you're promoted? Are we higher starting salary but they're at two? Do

what do we know? So we don't know if it the starting salary may be really high but it might be progressing slower. We we just don't know. Correct. All right. That's something we can look into. That would be that would be interesting to know. Okay. Um, those were the big things I had really. Who else is questions, comments for public safety? Go ahead.

Yep. Um, wait, was was Matt Kay invited to attend tonight for the sheriff's office? No, the focus was on police time.

Okay. I thought it was all public safety. I there he there's a very long summary that was written there and I'm just wondering um it it sounds like he's having the same recruiting problems that the police department is. Um there's a mention of evictions rising and I have put some questions I think I emailed them about what does that mean? Are we going from like what's the what's the percentage and what's the actual raw numbers of evictions? um his department, small department was one that had a half half budget half a half half a position cut and I think I don't know if it's in here or I had heard through the grapevine that he had requested an increase to a full person and instead got a cut to a half person and I'm just wondering how in his mind how that affects it how as a current unmet need where does that fit in this

um public safy you need. So that's one set of questions. The other one is I'm really glad that we're doing accreditation. When we talked about that last year, I was really concerned that that had fallen aside and glad that you're working on it. So thank you. Um and I echo Miss Flynn's question of how will the the like the things that we need affect either accreditation or the ability to provide information. So, I think that's an important thing to keep in mind. Um, you mentioned the garage parking and that we have a lack of parking in our public safety garage.

I didn't mention garage. I just said parking lot. Oh, I thought I heard. Well, tell me about Well, tell me about the parking garage anyway. Sure. So the the I'm trying to be careful here because there's operational security implications. Um but there are uh the parking garage capacity is shared between the police department and the sheriff's office.

Um there's also it's also used uh for some of our prisoner processing. Um, but there aren't enough spaces in there that even get close to what we need. Uh, in terms of secured parking garage, more so the parking lot is a constant issue. As I mentioned, every Saturday, uh, the police officers that are on duty, we're all at home. um instead of running calls, they have to move all the cars because the farmers market happens in the front parking lot. Um and several days throughout the year, uh Memorial Day is coming up. Uh we have to move all the cars and we lose complete access to the police department. So, part of it is parking issues, cross um um cross paths. Uh sometimes we'll come out to our cars and we're um unloading and loading firearms and next to us there is a mom from the community center and they're unloading and unloading their kids. So, that's an example of two things that should not be happening in the same space. Uh, people coming in to turn themselves in, happening in the same space that somebody's coming in to report a crime. Um, has some discussions with community members about that. I mean, there's equity issues there. So, the parking lot issue is a lot more than just capacity in the garage, which there isn't enough space for. Um but there's capacity issues and crossf functionality uh implications there.

And what would be the best solution to that? Was that part and parcel with a

generally police departments just like a fire department that has dedicated parking vehicles for their apparatuses generally uh police departments have secured parking area for vehicles and police personnel. So when an officer comes to work, a lot of our officers don't have cars that they, you know, take with them. So they have to switch their gears from their personal car to their their police cars. Those transfers should be happening in a secured parking lot. Additionally, um you know, people shouldn't just be walking around between our vehicles. Um, as I mentioned, the sheriff's uh department, I think, had a vehicle torched a couple years ago in the parking garage. Uh, so I think what needs to happen is there needs to be a secured area for both police vehicles and police personnel vehicles uh for those functional issues. And there's there are operational risks I'll be happy to get into in close session if that's what council wants to do that do raise some serious concerns for me.

But those needs don't really appear on this. That's a long-term CIP. Yeah. Those so the title of that uh you know immediate and current. Um, again, uh, kudos to city manager's office for supporting putting that on the CIP project so that we can have these engagements and discussions with council and the community about Okay. So, that would be part of a public safety headquarters plan. Yes. I mean, I would I would think so. I mean, I'd leave that to council and the city manager's office and the community. Obviously, some of the needs are more um immediate than not, but that's where it sits right now on the 10-year uh calendar.

And and I'll just share with the council, I do think it's it is a pretty important moment that we have a public safety facility in the CIP. And Chief Farard was raising this need to me kind of in our one-on-one conversations. And for this to be a discussion that goes, you know, has traction in terms of planning and really starting to get our hands around the police department's needs, what its future housing is going to be, it needs to be in the CIP. And so that's the for the first time um a standalone police station is in the CIP for to begin that planning process. And then my last question is if we can go back to the immediate needs slide. This is those immediate needs.

The one-time funding in particular um is more than what we have in our revenue surplus. Right. So where if we were able to fund it, where would we get that from? Is that a I mean so you know I I'll just first I'll speak philosophically. You know this budget really has three things in it.

It has compensation for staff. It meets the interjurisdictional contracts and it has the police supplemental. That those are kind of the three things that are funded in this budget and everything else was no. And so that's why you're hearing in this budget cycle so much about un you know things that we're we're struggling with. Um and that is kind of because of the unique high costs of our uh contracted obligations.

So that that 650 if we don't have 650 it's not an all or nothing. We It'd be great to get you the eight vehicles, but if we could only find the money for five, we could do five and you'd still be short. You still wouldn't have the other three, but it's not a you must get all eight or zero. It's you you'd like all eight. I know.

Sure. I I I think we can make whatever the council and city manager's office can work. Again, there's risks with everything, right? So, the implications of an aging fleet is a lot of our officers, again, on duty, I mentioned on uh farmers market. We spend a lot of time shuttling these cars back and forth to repair shops because an 11-year-old police car is constantly breaking down. We recently had to bring in a vendor to uh recalibrate uh hardwired radar units in some of our patrol cars. And a vendor comes on site, we pull these cars off service and they recalibrate the radar for traffic enforcement. Out of five cars, three of them weren't available because they were in repair shops and we had to bring the vendor back. So there's all these. So yeah, we can we can make five work. We can make whatever work, but the risks are still present and we should do as much as we can.

So, give me a bottom line number for the vehicles because I heard a discussion that we've actually got some in the works for FY 2027. So is the the net number for the vehicles that we need in FY 2027 that is not budgeted is that the 650,000.

The 650,000 is to get our re uh replacement cycle up to where the city has established it. Six years for mark cars, 10 years for unmarked cars. So, we have right now eight cars beyond what we've already ordered, beyond the salary savings that we talked about. We have eight cars that are either at or beyond a replacement cycle. Moving forward, so that's the stabilization one time. Moving forward, the cycle based on the age of the fleet, six years, 10 years, it's about three to four cars per year. And that's the 350. Uh the entire city budget for all of its vehicles, 360. So, uh, what I would ask is that the police department's replacement cycle get funded wherever that money sits. So that, um, a car is due to replace on the sixth year, six years old, the money's there, and we're not spending so much time trying to scrge up, you know, money to replace that car. So hopefully that answers your question. Yeah, actually it confused me more. Oh, sorry. Um, sorry. Um,

I don't want to prolong this discussion, but I'm I'm trying to, you know, we we need we need to do an FY2027 budget. We've got stuff to balance. Everybody knows that. But I'm trying to figure out what do we what do we have to do in 2027 over and above what it is in the city manager's budget? Is it $650,000? Is it $350,000? What is it? Do we have that number right now or should we get back? Sounds like maybe we need to get back to you on that. Okay. Helpful. Yep.

That's my one question. Um the other questions were asked on personnel related issues. Thanks. Everyone's gone. Okay. Uh thank you. I have a few as well. Um, so I think early on in the presentation I feel like we buried the lead. I think you mentioned that it's our lowest crime rate in 17 years. So just like celebrating like extra revenue this year like that's also important especially in light of growing population. At first when you said that I was like oh it must be a denominator issue. We just have a bigger denominator i.e. more population and it's diluting it. But I think you even said that the crime rate per 100 thousand has also dropped. That's that's the crime rate I was talking about. Yeah. So that's good news all around. Um, I guess I would like to better understand like trends over time

and so how that looks maybe the past 10 years or so because our population's grown a lot in the past couple years, but over 10 years, I'd like to know kind of how that looks. Sure. Whatever the right stats are and maybe that comes out as part of the annual report.

Um, and likewise for staffing, I know that we did the additions in FY25. I'd like to know what kind of sworn versus support uh staff looks like maybe over the past 10 years as a benchmark to population. I think in the past when I've asked that I think you or Chief Cavin has kind of educated us that maybe benchmarking based on population is not always the most helpful statistics. Maybe it's based on, you know, per capita, per square mile, per crime rate, per calls for service, whatever the right metric might be or maybe all of those. I think it would be helpful to understand over the context of say five to 10 years. Um because while obviously this year you're telling us we have lots of needs, I'd like to put in the context of how that looks as a city has grown. Geography wise, we certainly haven't grown, but we've grown up and added more population.

Sure. Uh, so that's my second request. Uh, couple tactical things. I think in the budget book, um, and I think during previous discussions, we talked about moving red light cameras during this calendar year. Do you have line of sight to when and where that's going to be?

So, that's uh being done right now. Um we when we discussed this with council last year, we went back and conducted a study to uh where we think the cameras need to go to. That's based on crash data, you know, engaging with traffic engineers. So we identified two sites to move them to. And just for clarification, we have four cameras in that uh program. And obviously a four-way intersection would need four cameras. So, we generally have distributed to those four cameras at two different intersection with only covering two directions on a four-way direction. So, um the construction has been done and uh uh we're working through some final testings and then when they're ready to um um turn those cameras on, we'll have to do a 30-day warning period. So, we're very very close to uh making those moves official. Okay. Uh because I think the reason we asked that is obviously there's a desire by council to have more automated enforcement. I think traffic um safety continues to be like the top thing we hear about and the more the better we can use kind of automated enforcement hopefully the less officers that have to be out there. That's right. Well, especially those high-risisk areas and then hopefully reduce um safety concerns we have.

I almost got hit today. Yeah, that happens to me pretty much daily like especially turning vehicles, right? Like if you're in a crosswalk and there's a left or a right on red, those are always the riskiest situations. I think we're just ignoring the hawk signal. Um out of the I guess patrol or kind of on duty for street safety, how many are on traffic right now? On traffic. So are

so we only so we have two traffic dedicated traffic positions, but they're also splitting half their time with other functions. our uh canine officer who's uh temporarily assigned to the SRO function. He's half K-9, half traffic or other traffic officers, half traffic, half community support officer. So these are some of the things that I think will come out in the matrix report about efficiency and effectiveness. But our patrol officers uh so we have uh let's see 12 so we have 14 patrol officers assigned. That's a for a 247 operation and they spend their time responding to calls. When they're not on calls, they'll do proactive policing which includes traffic enforcement. Um, and that all will come out in the uh matrix report where they look at how our officers are spending their time and determining where the opportunities are uh exist and where they may be overloaded in workload and how we make um changes in in those those things. I think in my mind I'm trying to keep in mind like increasing population but decreasing crime rate

and then I think all of us on council hear kind of the concern about transportation safety and street safety and wanting to have more enforcement of speeding and stop sign running and you know people not obeying hawk signals and how that then coaleses into the right staffing. Yeah. Uh to be responsive to those needs. Yeah. Uh and then plus all the things that you've cited of you know things that we can't see right. How do you efficiently police and staff and take care of foyer requests? Um, and all the other things that are not just community requests. Yeah. I'm trying to pair all those needs into like what's really important for the community, especially when we're in an era where everybody has needs and we can't clearly fund everything, right? So, that's what I'm trying to get a sense of. Okay.

Uh, last question maybe a combination for Cindy as well. So, I know with some potential general assembly action and I think a bill the governor did sign is actually more authority on cameras potentially on high-risisk areas, but it was like limited to high-risisk areas. Is that correct?

Yes, it's limited to high risk. They're calling it now red safety zone and um it just did get signed. My read of it and I will need um the chief and his team's review is it probably doesn't really change the impact on the city of false church because I don't think we're going to increase any intersections based on their non-enhanced definition of a safety. Yeah, from what I what I've seen, obviously we'll we'll see what the final outcome on the general assembly is, but I haven't seen anything that's going to give us any greater uh capacity with photo enforcement for our city. Okay. Well, that's too bad because I think we were hoping for more authority on that. Um,

yeah, they still have the fatality rate in their trigger and we don't actually want to have an intersection that had a fatality. Yeah. No, that's Yeah. Okay. Thank you. I think the rest of my questions were talked about in the context of those things. So, any final questions or comments for the chief? Thank you for his team for joining us as well. Okay. Thank you. Okay. Thank you. So the next item on the So the next item on the agenda then we'll um turn it over to uh Sharon Gibson, our HR director and um and what

do we I think we need to go back to the school. We'll go back to the school thing. Okay. Talk big picture. Yeah. I mean we're two weeks till markup, so probably a good check-in point. thoughts in light of the work sessions we've had.

Miss Connelly, do you want to kick it off? Schools? Well, I I'll I'll I'll start and then everyone So, we did receive an a letter from um the schoolboard chair and the school board vice chair um earlier today and uh mostly talking about uh revenue and I think mostly looking at um that you know that 700 we were talking about earlier this evening um when Mr. or so talk when we were talking about you know looking at that increased meal tax projection and that you know and and looking at extra 700 that we hadn't originally incorporated into the budget and uh the chair and the vice chair and then other school board members who also emailed us later just saying that you know um asking us to follow um our uh agree to revenue share that um we've had on the books for uh quite a while now I think about eightish years or so. Um and uh and I know that's something that um you know in uh the past two years at least we haven't be been able to for different reasons. Last year quarter three was took us you know took a bad turn and so we we cut and then I think the year before the council decided to do lower the tax rate so that affected revenue. Um, so, you know, looking at um that amount and I know that we as a council also have um concerns, you know, paving. I mean, obviously the chief talked to us tonight about a public safety things. Um I know some of us would like to see you know it would it be possible to give some sort of reduction on um real estate tax rate given the high assessments and um so we do you know I think we're just trying to grapple with all of these

different um needs that we have the schools have sent you know in the budget Q&A uh there is a list of different positions and things they would like to use if um with some of that revenue. new. Uh, and I think, you know, I'm just trying to talk about both sides. I know that many of us have spoken with our school board um colleagues um over the past couple days. Um, and so, you know, really, I think some of us uh I think come from the perspective of they were fully staffed a year ago with the expectation that 150 more students were coming and those 150 students didn't show up. And so in terms of staffing, one would think that they're pretty well staffed. Um, and that's why they followed up, I think, in the budget Q&A with providing us with areas that they still of need that they feel like they still have.

Um, question 56. Yeah. In budget Q&A. So, thank you for that additional detail.

Yeah. And um you know in some you know looking at that list I would say I think one of them is a reading specialist and then a math specialist and some might say well couldn't you you you're overstaffed couldn't you move some staff around to cover those positions um you know so so I think there there's you know a lot of um on both sides uh you know give and take and so I would just throw that out there. Um, you know, we have had the agreement in and the budget revenue the revenue sharing agreement in place. Um, you know, I think it's for another time. Maybe not right now, but maybe after we get through this budget season talking about could we come up with a agreement that's a little bit more flexible. There going to be years that the city council needs money um for paving and for whatever. And then there might be a year where, oh my gosh, the schools did have 150 kids show up and they need more revenue that year. So, I I just feel like there it needs to be a little bit um maybe some some flexibility. Uh but you know uh you know the schools did find some money to cut um you know they came in and and you know with a higher um ask and you know went back to the drawing board and did make some cuts. So uh you know I I really see both sides of it. Um but I just wanted to throw it out there. I know that our, you know, there's also a to be said a relationship here between the city council and the school board and I want to be cognizant of, you know, keeping that positive relationship. Um, so I'll just leave that out there if anyone wants to join in the conversation. Thanks.

Other thoughts?

I'll go second, Laura. Um, so I was not at the budget and finance committee meeting on Friday trying to wean myself away from them because after 10 years of chairing that committee, I just wanted to back away for a little bit. Um, but I do think there is I I'm looking at the email that we got from the schoolboard chair and vice chair today and I'm sure several of us all had conversations with them after that budget and finance committee meeting. Um this they pointed out that they are $620 lower than the original maintenance of effort request. Uh that is a list there I guess of some of the things that they would like to be paying. When I was talking to Mr. Shields you were mentioning that this general government was absorbing a large amount of contract interjurisdictional contracts. I think this this says the schools are as well. And I don't know how that compares. Um but it seems like a lot of the increase is going towards other things things that we're paying for in other jurisdictions. Um

healthare for them. I don't know. This says

yeah healthcare is big. there's something external contract obligations unfunded mandates from the state evolving literacy and math instruction requirements but can you talk a little bit about the what the city is absorbing on interjurisma contracts? So I um I think that this year has been sort of a a unusually difficult budget on the general government side and I would argue asymmetrically so relative to the schools this year and um and that's really related to one the big drop in investment revenue which it's a benefit that investment revenues are not part of revenue sharing agreement. Um, but that was a big million-doll uh reduction in revenues and that impacted really important programs on paving and affordable housing. And then the uh contracts, $2.5 million increase in contracts overall. And um and that I think is just not something that we experience uh in most years. and we absorbed all of that and u and we had to reduce our staffing levels in order to balance the budget along with make about um $800,000 of other cuts throughout the budget um to balance it. So I have in terms of the stress on the revenue sharing agreement I've do have a perspective that I think it is particularly stressful on the general government side. That's my perspective relative um to other years. Um, so the other thing you mentioned the word asymmetry and I think that's another important part of this whole thing of why we even have the revenue sharing agreement because it is asymmetrical that the school board always has to come hatin to the city council and ask for money and they are trying to run a program and they're

always coming and asking for money and we hold the pur springs and we hold the power and that makes it a little bit asymmetrical like we're not writing this letter to them. They're writing this letter to us. So, in trying to be a partner in a revenue sharing agreement, I think it's really important that we're we are following through on what we said we would do. And for the last two years because of different reasons, we've changed the game in April. And if we decide we need to change the game again this year, then as a partner, we're creating even more asymmetry. And next year, who knows what's going to happen. We could end up being back the way we were eight years ago. So I think the value in the revenue sharing agreement is following the process that we laid out and and maybe there is time this summer to be able to say well when we have a weird year like this where there's all this interjurisdictional commitments those things are taken out and Mr. Agan has talked a little bit about what do we do with a debt service on Meridian High School? Is that held separately or included? So, I think there is time in the future to really look at this. But I think right now we're in a position where we asked the schools to do certain things. We told them we would split the revenue and now we're it's almost now now we're hearing all these different things that we have police and masked arms and other things and and they're almost like shiny things that we we have to take care of and they really matter to all of us. But I think we can't forget that funding the school budget also really matters to all of us and really matters to the people who elected us and elected them. So, it's it's just it's a really tough situation, but I would advocate that we should follow the traditional revenue sharing

agreement with this additional projected revenue and then make a commitment with the school board that we're seeing that every single sol year has its own little special tweak and we really need to be more alert to that.

Uh, and thank you. And I I was just corrected by a school board member um that they did indeed cut uh from the budget the teacher positions that have been added for enrollment from this budget. So I I misspoke there, but um I you know I do um I I was um Miss Connie and I were talking about this today. So when I my when I was president of the elementary PTA was Dr. Nunan's first year and that was prior to the revenue share and you know I had to like write I probably I think I actually talked to Ly on the phone but I uh you know wrote to the Nick Benton and I went before the city council when you used to meet in uh in community center while I think this building was undergoing renovations or what have you. So I remember those days of having to you know advocate um and so I I'm really and I've told my schoolboard colleagues this as well. I'm torn because um I do feel we should be good partners and follow that revenue share. But then I also something like paving I do feel like that's a a public infrastructure that again the schools benefit from having our roads repaired and their school buses, you know, tear up our roads somewhat, you know, and so that is something that I so I I am struggling with this. Um, and I agree with you, Miss Connelly, to the revenue share is important. And I feel like we should keep our word and then, you know, afterwards in the summer renegotiate, but on the other hand, giving our citizens a little tax break and um again, making sure that our um infrastructure, you know, that those needs because we we can't keep getting be more behind and more behind and more behind on this on this paving because we'll never have a year that we can do a huge catchup. So, we've got to keep chipping away at it. So, um, so I really, you know, I I'm not I'm not adding to I'm just wavering very clearly

because I'm I'm conflicted. Thanks. Other thoughts? Um, Erin? No, no, you go ahead. That's fine. Um, I'm looking at the letter that was sent and u the the 620 versus the 205 the right sizing of the teachers um I understand the 205 is below what where they needed to be the um and I think that's really driven by the in the ex the health insurance costs that were beyond what any of us expected. Um, we to see the same on general government

and we absorb that. Yes.

Yeah. So, and then there's but when I look at the 700,000 um that we're now seeing as additional revenue, we're talking about 350 to the schools. So, the 205 you end up with 145. I would say it's not that much. Um the I would like to it would be nice if that went to supporting the debt service on the high school. Um but I think it's more important not to change at the at this late point. I'd rather have a more thoughtful discussion after we're out of the season. I think there are some structural changes that could be made to give better guidance in um January so that there's some insights into well wait a minute if our bud if our revenue comes in really well this is what we're going to do that that way it's not a surprise um but if revenue tanks then this is what we're going to do um I think there's some improvements there uh at the same time I look at the comment about the um transfer per student. And yes, this year was basically flat from last year um based on projections. Last year was up 2.1% per student. The year before that up 1.5%. The year before and this is all after inflation. So inflation adjusted. Yeah. FY24 was down 1.3. 23 was down a lot because inflation was so low high. So it's I I think we just need to take a look at the numbers and but I think most importantly this is last minute. We have an

agreement in place. we should be abiding by that agreement and move forward with splitting the the 700 according to the revenue share agreement and then maybe we talk about it during the summer. Um, one big outlier of the whole revenue agreement and everything else is that it was agreed between um a superintendent and a city manager. The superintendent has changed. The city manager is about to change. Sorry, Wyatt. Uh, but and maybe that's and both CFOs

and both CFOs have changed. So, we've had a lot of turnover in the interim. That's something to discuss in the summer is that and maybe whoever we choose comes in with some great idea that's different it and talking to and maybe this is an interview question. Yeah. Maybe this is an interview question.

It's um but I think this is something we have an agreement in place. we should abide by agreement. Um that 135 beyond the 205, I don't want to dig into what they spend it on. That's the school board's job. And they have a list. We understand what they're looking at. What's most important on that list? That's up to them. Um but we're not going to fund the whole list. We're not going to go beyond the the split. We're definitely not going to do that. We're not going to go 52% to the school. We're going to split it up 50/50 and that's the agreement. So

Erin, do you

Yeah, I mean I have a few different thoughts. I I'm still trying to reconcile, you know, budget share, revenue sharing, sort of the idea of spirit of revenue share, strict adherence to 5050 versus a spirit of revenue share and sort of saying we're going to try to come in and we're going to try to do the best we can at 50/50, but like ultimately city council has to make decisions that are more holistic decisions than the decisions the school board has to make. And we're accountable to that. we're accountable as decision makers to the public. We wear different hats and I understand the school board's advocacy around this. I understand the concern about not having strict adherence to revenue share. I think the, you know, comments at the last school board meeting. I watched them. their completely justified and legitimate comments on behalf of school board members who want to be able to have, you know, predictability in their budget and say any increased revenues we should or want, you know, to have 50% of it going into our budget. Some of the concerns I have are the concerns that you know Lety has raised over time with the what's sustainable in terms of year-over-year budget growth. what is realistic in terms of thinking about the size of budget growth we're going to have each year and my experience just now in like year three of doing this with what um has been difficult when we do you know signal wanting to be responsive to taxpayer burden or to address you know some of what we view as critical needs as kind of a lack of flexibility on the school board's part, so to speak. Maybe that's like a little harsh. I don't know. Um, in thinking about like the last two years, I don't think we changed, you know, the game over the

last two years. I think two years ago, we were very clear on we were looking at a range of potential tax cuts and the school board, you know, came in with their budget and we had conversations on our side about going deeper than the budget that we received and that was clear from the very beginning last year. We got Q3 financial data that would have been irresponsible not to react to based on what we were seeing and we did our best to respond to that budget situation and we, you know, included contingencies on our side not to cut deeper into the school budget or to force cuts because of what we were hearing from our partners. And then I get, you know, concerned when we have healthy growth and that that that the sides sort of start from a what is status quo and what does that mean? When I would hope that both the general government and the schools when we approach budget are thinking about how are the dollars from each year serving the community? How are they serving our priorities? How do we look at our budget and potentially streamline certain programs or, you know, phase out programs that may not be as responsive to our needs right now and open up dollars both within our budget for things we need to do in addition to the new revenue streams or the increased revenues that we're seeing. Um, and so I don't think it's a like what's the status quo on either side and and how much more does it cost this year and what else do we need to do, but where are our dollars going? How do we potentially allocate them or reallocate them in different ways given priorities, needs, what we're doing well, what we're not doing particularly well. Um, and then thinking about, you know, what are the needs going forward? And if we, my real concern is if we

allocate $500,000 more to each side that then it's in the budgets and then we come in and we can't sustain those budgets and we're asking people to make cuts in operating budgets after they've gone and hired people and it has real, you know, effects on individuals. I sort of feel like on our side when we're saying, you know, what's the paving budget or do we use this for fleet, right? like they don't have the same effects on operating as saying here's half a million dollars, put it in your operating budget and suddenly there are individuals with salaries and health benefits, you know, and so that's where I sort of feel like the the way we're using these additional dollars feel different and the ability to scale back when we need to feels different. And that's kind of just like what I struggle with in terms of just the differences in our budgets generally and why, you know, at this point in time recognizing we have, you know, a million or so extra dollars over what we were talking about on each side for budget guidance. why I can't like still commit without giving this further thought into saying like, "Oh, I'm okay with splitting $500,000 to each side or I'm okay even using that $500,000 versus wanting to reduce what the expectation is about that, you know, 1 million generally and should it even be in consideration versus a, you know, half a penny reduction or where that leaves us, you know, a year from now." That's why I asked that kind of line of question early on when we talked about 700,000 and where would we deploy ours where you know should things go south that we can easily pull back and anytime you talk FTEES that worries me um because that is not something that again in an age of uncertainty that we can pull back easily if you've made the hiring decisions and seven out of eight

of the things on the school list are FTEEs and some of what the police advocated for FTES and that worries me even if those sound really compelling and important. So I would caution us against again growing budgets when we don't know whether I mean you feel good about the 700,000. I don't know how Q4 I don't know what the rest of the years will look like but that does make me worried. So sorry to interrupt. Did you have more?

No I don't think so. And then you know I've I've also talked to yeah people individually and like I said I think they're legitimate justified concerns right and when we nibble at the edges what does that mean for going forward? you know, is something that's small, marginal, you know, does it get bigger over time and what does it mean for trust in making budgets or what a proposal comes in versus like, you know, our starting points now. Um and so yeah, I understand the concerns, but I do want, you know, the flexibility and ultimately I think like our positions um demand a little bit more flexibility than like a strict adherence to a 50/50 revenue share. And you know, we have to be accountable for those decisions, too.

Other thoughts? Um yeah, echoing a lot of what I've heard, um my sense generally is that the needs this year are asymmetrical. Um and to Miss Nouns's point, um I'm strongly in favor of having a more flexible agreement. Um especially because I mean, you know, I've been getting messages about, you know, sticking to our word and whatever else. Um, but we need some flexibility in the budget, especially if if um unexpected things come up or or things happen. Um, and you know, I think about it this way. There are going to be years where maybe there's a recession and uh we have just as many school kids. Well, guess what? The schools are going to need to get maybe even more than 50%. That's a possibility. Or there are going to be years where um you know, we're $30 million in debt for a road paving budget. And so like we need to be able to pay that down and find ways to to do that and that's a more urgent thing. Um and so being able to have some flexibility. Um and so that would be a discussion that I would really like to have in the coming months. Um I know I'm looking at Andy with the work plan. I know we kind of laid out the work plan. I hope we have some like flexibility in there to add other things in. Um, but that would be something I I really would be interested in exploring specifically because um I know there's been a bit more peace in the valley than there used to be. And you know, we don't want more Laura Downs coming to city council to tell us we're doing a bad job, but um I I do think that uh there there is a way to come up with an agreement or a formula that um is possibly amendable to all sides. And so that's where we would be working with our our partners on the the school board to figure out like what would be uh another another way rather than because you know a 50/50 split is

is very simplistic um and doesn't necessarily account for all the needs that exist. And so maybe there's a different sort of formula that would still be a quote unquote revenue sharing agreement um but it can be a bit more flexible uh when we need it to be. Um so yeah, I would I would like to see that discussion happen. um in the next in the next few months if possible. And now that I'm throwing this on you guys, I don't know if that's possible that we can have or open that up as a discussion.

So, a formula's tricky. Um but I think a an agreement on kind of what the criteria are when there's a need for flexibility so that there's some more predictability to it. I think that is a construct that could be fleshed out. The budget and finance is taking up the revshare agreement in June and so these ideas I think will carry into I think probably a productive and fruitful discussion. Okay. In a month.

Gotcha. Was there and just quick history um when the rev revenue share was implemented uh years ago andif at 50%. Was it just like this is a simple number and it seems like we're both about 50% so like we'll keep it like that. Was there ever a discussion of doing something that was a bit more flexible? So we walked through all sorts of scenarios of like what when do you break it and that became so unwieldy that that's it became too complicated because you're trying to imagine every scenario and um so we tried to keep it simple

and um that's the short uh and that's also why it was never adopted by the two boards because when you when it came to a vote there was a desire to well what if and so we decided to keep it as a spirit really of revshare and it really lives on because there's a a spirit of wanting to uh make it be successful. I think we did do one redline edit maybe like three years in that said the tax rate consideration comes ahead of any sharing and that's we're wholly responsible for that. I think that was one of the red lines we added a couple years in, but no, we never voted on it, really adopted it, per se,

because I would I mean, at least uh from my perspective, I would imagine that there might I mean I I love the idea of a formula, but you know, again, I mean, I hear you saying that maybe a formula is a really tricky thing to have, but um looking at the number of, you know, maybe there's a base amount plus like the number of of enrolled students plus um especially if they're special needs or um English as a second language, you know, having some sort of I guess general rubric of like we understand that these things add additional costs but you know in in bad times those costs don't go away and so we realize that we need to fund our schools to that degree and in good times um those costs are are pretty steady and so how and how do we implement maybe something like that that then adjusts for inflation with some baseline amount that can contribute to school maintenance or whatever that would be but anyway I know I may be jumping the gun um and that would be a discussion to have in June or later

and one other thing that's very helpful for a revenue for the spirit of revshare is to have a big project that the two boards are working on and trying to accomplish together um that seems to have been very powerful to helping it be successful have another one for 25 years though so can I just say one more thing just prior to the revenue sharing agreement Justine from January until April

it was really torture to be on city council and school board and Laura Letty Dave Wyatt Cindy you can attest to that it was it was just a constant battle and people would be walking their I remember Ross Lincoln house saying I was walking my child to school this morning and somebody stopped me and was just so upset about that. I mean you go to sports games and that's all anybody would talk to me about. So it was okay super allconsuming because

because there was always and it always ended up being like $400,000 $500,000 and that's kind of where we are still is how do we allocate that last $400 $500,000 but when they did the revenue sharing agreement and it was you and the CFOs of the general government and the schools they looked back to say what did we do historically what was the split historically and how do we keep that going? So essentially it was the schools were actually getting more than 50% right prior to the revenue sharing agreement and we've worked it down to be actually 5050. So not really sorry.

Yeah. Were you done Justine? Um, no, I was just going to say I I would hope that like there's some middle ground between like I don't want to call it chaos of of pre-revenue share and um and then having flexibility. I would hope that there's some way that we can set expectations like so that we're accomplishing the needs of everybody um as best we can. Um but then also not just having you know as I mentioned more lower downs coming to city council to blame us for I guess one piece of context I guess in my 10 years because eight of those had revenue share is in the eight years since revenue share minus the COVID year we've just had really good revenues. Yeah. And so that just makes revenue share work out well right hey you get half I get half. No questions asked.

And so while there is peace in the valley and some of it is because we've been in a really lucky economic environment. So obviously it's easy to split. we plan. It's part of our plan. So Dave,

sure. Thanks. Um, so um I think as it's been discussed, there's a need to work through some scenarios um for the application of a revenue sharing agreement that um need some additional work. Um my own view is if the city council decides to reduce the tax rate that is not revenue uh and it's not subject to revenue sharing. It's not revenue coming into the city or to the schools. So if we decide we're going to cut the tax rate that should not uh trigger any kind of revenue sharing and then the remaining amount that's available should trigger the current revenue sharing. Um with the uh added um discussion that needs to occur with respect to some of the scenarios and some of the flex whether you call it scenarios or flexibility or whatever you call it something that understands potentially um unique needs. I would add that we're dealing with um as Wyatt had said the jurisdictional agreements. Well, one of those is for fire service, right? It's pretty obvious that fire service benefits both the schools and the city and yet we're taking that on. The other area uh of uh interest for me is capital versus operating and the extent to which we take on capital expenditures but is not considered in the revenue sharing. It seems to me that's another potential uh issue for discussion. So, we can have those discussions and I think I'm hearing and I certainly would agree with that. But for this year's budget, if we agree to tax cut the tax rate, we do that and that is not subject to revenue

sharing in my view. Agreed. So, okay. So, I guess I'll one other thing. I do want to thank the schools and the school board. I do think they they did everything they could. um this year in particular. It's not that they haven't in other years, but this year in particular. Thanks.

No, it's okay. Um so I guess I'll be the seventh voice, which won't be a surprise to anybody that I think revenue share needs are revisiting. Um I think it needs a modernizing, right? So it kind of assumes that the needs are 50/50 and the needs have not always been 50-50, but it was better than what we had before pre-revenue share. And clearly, I think I agree with based on hearing the needs in the city, the needs are pretty asymmetrical this year. So, I think we can kind of put a pin in it and hopefully we can get to the summer in the June discussion about how we can actually update it to provide more flexibility. Um, I think having done enough budgets now, I think our job, like I get why the schools advocate for their needs. I get why the police chief does. I get why public work says we have all these needs. It's our job to balance all that. We're the ones with taxpayer accountability and that fiscal responsibility and we have to make those hard choices. And that may mean hearing from teachers or parents about how their needs are really important. Do I want them to come out and tell us, you know, that we don't care about public education? Of course not. But our job is to hear those hard things from all the different constituencies and figure out what the taxpayer burden is and how to fund all those. Um and so I guess that's the first kind of comment I have. Um when I think about kind of where we are in the cycle. So we're going to have an optics issue. Frankly, we have an FY26 surplus of 700,000 which we will split with them. But from the our residents and our businesses, we're going to hear that we have a surplus in FY26. And revenues are doing better in FY27. So much so that we're revising forecasts up by 700,000. And so that's good news on all fronts. And it's because mostly our revenues are growing because of healthy real estate revenues. Our AVs, you know, are high. 25% of the people are seeing double digit growth. And our commercial growth is leading to higher sales, meals, personal property tax, and things are doing better. So where is a taxpayer in all of this, right? And so for me, I mean, the easy thing could be we cut a penny and that's 600,000 off the top and we're done. because I do think that, you know, that is when we think about the increase to median home um owner at $600 and that is higher than we've traditionally seen in

many years even with inflation. And so the easy thing could be we cut a penny and then there's really nothing left revenue share. I do think there's a compromise solution where we cut half a penny that's 300,000 or so Wyatt and David and then we figure out for the remaining 400 how we split that. Um and if the needs are asymmetric, maybe it's not a perfect 50/50 this year. Maybe it's a 5248 split so that we can fund some paving needs because we think paving is a thing that could be pulled back easily if Q4 goes south or if FY27 numbers don't come to fruition and then we share some with the schools. Um, everybody doesn't get everything that they want, but this feels like a good three-way solution where taxpayers get a little bit of a relief, we fund the paving needs, and then the schools get some additional money, not the full 500,000 they're asking for. But in a like good news scenario, I feel pretty awkward in talking about FY26 surplus and FY27 revenue doing better and then saying we're just going to spend all of it. like that is both irresponsible for this year and next year because we're all pretty worried now about some issues in FY28 and again I share concerns about in general what long-term sustainability of budgets look like and they are not 8% growth every year. I think forecast from FY28 and beyond as David said is between zero and 3%. And so we really should take a hard look at thinking about what that looks like and what that means and how can you have budgets that grow that much and then suddenly contract to zero to 3% um if AV does not grow as much as we'd like. So, um, I guess I'd like to see that, you know, figure out a viable compromise option where we take care of all of the needs. Um, I think the math shows, and Wyatt and David can check me on it, but I think the math shows that we can hopefully do all three things. Uh, and then in June, we'll talk about the broader how to modernize revenue share to provide more flexibility. Thoughts on that?

Yeah, I think that's a good approach. Could can you go through the numbers again just so that I have them? So it would be we feel good accepting the revenue reforcast of 700,000 FY20 let me start FY26 surplus gets split everyone gets 350. I don't know what the schools will do with it but they can add it to their capital needs. FY27 you're reforcasting an additional 700,000. Half a penny on the tax rate is about 300,000. Is that correct? 340. 340. So that leaves 350 or so, right? 360.

Could you then split that? Like how much would we need to bring the paving budget back to the FY25 numbers because no one loved that your FY27 number was below FY25? We need 180.

Okay. So that's a perfect split. So could you take 180 out of the 360 towards paving and then the remainder or you know if there's additional needs you buy a police car if we need that. Um again I really shy away from anything that increases FTEEs because I don't want to rely on this reforcasting um for more mouths to feed. That's just my personal bent and worry about where that we are with so much uncertainty in the environment. So, so I think the math works out where you can do a half a penny at 340, the remainder could fund paving, maybe a police car, and then you know, well, we can decide, but or it could just be split. And I guess on FY26, I'd look to staff for, you know, the surplus, whether that should go in capital reserves, whether that can fund another mass arm, a police car, like we should probably do a rank ordering of unfunded needs, um,

and weigh that as part of FY26 surplus, too.

So, setting aside the surplus for FY26, because we'll we'll get to that one, and there's a lot of options. Um, I'm not really as comfortable cutting the the real estate tax rate in FY27 because every time I turn around, there's information about how we're failing our our citizens of not of what we're not delivering on. We're not delivering on the bike master plan. were not delivering on paving and the and just to be clear the FY 25 numbers at 8 something was below what it needed to be. It needed to the bump up that was a one time was to get us to where we were sustaining not excelling sustaining. So I think going all the way back down would really shoot us in the in the foot as far as the paving. we would still be falling behind. We're we're just trying to keep it um moving forward. And I think the thing we need to be delivering for our citizens and our residents is the services. That's what they're paying for. And we we have a fundament a foundation of the services, but every time we turn around, there's somebody asking for, well, what about this little thing or that little thing or this other little thing? And we don't have any leeway to do that. Um, we're not spending this money on some giant party. We're spend we would be spending it on things for our residents. And when you start looking at it's similar to an FTE, you make that cut, you're not making it

for one year, you're making it forever. And so we're hitting that ability for moving forward long term. I completely agree. It should not be spent on FTEEs. We should be really really tight with those and identify ways that we can do better um without that long-term uh impact that could really impact individuals and people. But we we do need to do a better job I think on delivering on the character of the city on the city and even the little bits. it it makes a difference. And so I I don't support a a rate cut um for those reasons. I think we hold steady where we are. And I would like to look at how we do the different taxes and how they're all bundled so that we if we do one, we look at how we can benefit our residents and still maintain the revenue we need to for these cost pressures that we're under. And these are not going to stop. Next year, we're going to get hit with the same cost pressures. Um, I feel like we might want to look at, you know, are there levers that we can pull that would benefit our priorities? How do we benefit small business? How do we benefit, make it a more enjoyable place for the residents and make sure that the people take using our facilities, using our roads, using our our environment are are helping to fund the environment. One of the challenges we have is that only our

residents really for a lot of it, our residents are carrying a heavy load for a lot of people coming through this city. We're not isolated. We're right in the middle of everything. And that's something we have to work out. It's not a quick fix or and it may take may take a little while of getting the right levers in place, but right now I feel it's very similar to putting in an FTE because it's a long-term cost. uh the reduction. It's a long-term um hit on revenue in impact on revenue. It's not a one-time thing.

Other thoughts?

Everyone wants to go.

Go ahead, Mary Beth. I can I would just say, you know, and coming out of our discussion last week, I mean, I think that to the ex to me a half penny reduction makes sense in the context of being concerned about next year's budget and a fiscal year 28 budget and wanting to be judicious about sort of the amount of money in the budget that we would then have to grow or scale back on for fiscal year 28. I think if we're thinking about a half penny tax reduction on real estate tax rate, I do want to think about going forward, right? Like how do you how do you find places for that service delivery you're talking about? And it might be that right we're reducing real estate tax rate this year given the projections, but that next year we are having the conversation if we do need to raise revenue about do we do that through car tax for a dedicated paving budget. understanding what these those needs are or having reduced the real estate tax rate a penny and a half because of residential taxpayer burden. Do we do something to somehow use CNI to get $300,000 in the budget to be able to have bicycle infrastructure and missing links funded in a different way than how we normally fund them. Um, and so, so I understand doing it given the budget numbers we're seeing, but I I do it in mind to like where the revenue levers may be going forward that wouldn't just be raising again a real estate tax rate as necessary.

I I understand what you're saying, Mr. Aken, because that's I you know, services are that's what we hear, right? we need sidewalks, we need, you know, traffic coming, this and that. Um I do feel like this year we did hear from people who were um shocked by their assessments and um you know, I don't know if we'll be in a position in future years to keep to keep whittling away at this tax rate. So I would support, you know, a half cent on reduction on on the real estate tax rate. Um I would say though um you know so looking at those numbers again um so that would leave so if we pulled that out and then that left us with I think 360,000. I I feel like, you know, if we just split it with the schools, we still have 180,000 we can make paving whole and, you know, but say this is then after this we're going to re we're going to renegotiate this this um revenue share so that there is more flexibility. Um I'm just not sure for you know 180,000 if it's worth it to just um ha you know sort of lose the trust of our schoolboard colleagues and and that um I understand what you're saying say mayor for sure like we could buy another vehicle or what have you. I mean for me the paving is the number one thing if if Mr. still feels like 180 would make us whole. Um, you know, maybe we go 50/50 this time, but again, this would, you know, from here on out in the summer, we've got to really renegotiate this agreement so that there is more flexibility. So, just throw that out there. Um, I never read my conflict of interest statement at the start of this meeting, so I'm going to just say it right now.

City council is discussing tonight the city's proposed FY227 budget. I'm an employee of the Foster City School Board, which will be affected by the proposed budget amendment. Because I am only one employee among many who may realize a reasonably foreseeable director indirect benefit from the proposed ordinance, I am allowed to participate as a council member in this matter under the Conflict of Interest Act. After consideration, I'm electing to participate in this transaction because I am confident in my ability to participate fairly objectively and in the public interest. Sorry about that. I had it already at the start of the meeting.

Yeah. So, I have to tell you that every single every single one of you spoke and I went, "Oh, that's a good point. That's a good point. That's a good point." Like, there's a lot of good points here. So, if anyone ever thinks that we're not wrestling with things, just watch this meeting because there's really a lot of smart people looking at this a lot of different ways. Um, so I think we have a couple more weeks to figure out if we want to cut the tax rate or keep the tax rate the same, how we want to figure all this out. um to get more information about some of the things that more information is coming about. Um one thing that we could do to cut some expenses is work on the city council budget. Mr. Snder mentioned last week that perhaps we shouldn't enact the pay raise that we had voted for ourselves. I and that's something I would support. Another thing we could do is um look at our attendance at conferences and meetings where the last few years seven of us have been going to VML days and maybe we need to say we can go once every two years, once every three years and if we choose to go another time then that comes out of our own budgets or our council salaries. So, I think that would not save a lot of money, but it would it would cut a little bit. And um and those are some of the costs that maybe we could reduce without affecting staff in any way.

Interesting. Um so um yeah this is something that I've been grappling with the the general conversation uh which is you know I am deeply deeply concerned about how much road debt we have and just how how much in the past year we saw how much the granny of Lincoln cost versus um what it was supposed to be um or what it was expected to be um and so my expectation is that we're going to see a lot of that going forward. And knowing that we um have been below maintenance of effort for at least for more than a decade. Um like part of me feels like it's fiscally irresponsible to cut taxes uh knowing that we have this huge debt burden that is like has been growing and continues to grow. Even with even if we fund it at $180,000, uh it still will continue to grow. Um and so we're going to have to come up with some sort of sustainable way. Um, but you know, I also recognize at the same time that the assessments went up an incredible amount. I mean, partly reflecting how desirable it is to live here, but also recognizing that that is a burden on on taxpayers. Um, so I'm unfortunately not going to give any sort of guidance as to like where I stand right now. I I I I I feel there's a huge fiscal responsibility that we have. I would like to look at the levers that we have. Um but in the next two weeks um it's going to be hard to it's funny it's like if we reduce property uh tax rate then like maybe we want to increase something else and I just we don't have the time for looking at all of these levers. So um you know and then Erin's point about u CNI or some of these other things are there ways that we can reorganize things um and so anyway we're not going to be able to do that in the next few weeks. Um,

and so part of me feels like, you know, if we cut taxes now, then we might not have these lovers to to mess with in the future. Um, but also if we don't cut taxes now, then then some of our population is is more heavily burdened. Um, I will make a quick plug for but I know I'm I'm I'm alone on this. um the for at least for road paving, uh the places with or or properties with that take up more land end up using up more of our road paving budget just simply because uh roads have to stretch longer to get to those properties. And so one way that you could more fairly make uh people equitably equitably pay for uh road maintenance would be to have a land value tax which is basically the split rate um option that we have now. I don't this is not something that we can implement but I just wanted to throw that out there just so that people are thinking about um that is a tool that we have in our tool chest potentially down the road that we can think about using but I'm not trying to throw another wrench in in what we do this year. Um, and then I'm trying to think, um, in terms of your point, I I it's a small thing, but like I don't need to be going to every single um, VML event or whatever else. So, I'm that I would be okay with. Um, I do um I I do think that like in terms of people running for city council and and um being more inclusive, I I do think that the the salary increase is important, but um I think we can easily cut back on our expenses in other ways.

Other thoughts? Okay. I heard three, four soft support for half penny and then split the remaining. Is that correct? Y. Okay. So, we have two more weeks to kind of deliberate. We'll hear more needs, I'm sure. Um, but given that we're two weeks from markup, I thought it'd be good to at least have a pulse of where things are. All right. Appreciate discussion.

Um, so next on the agenda, we did have the uh the employee count, compensation increase, and class plans. And maybe I'll just be real brief on those. Those are uh the the employee count is what's in the budget book. And now council would be ordaining that. So if we're going to shift between departments, we'd come back to council before doing that. uh the compensation increase that's 4% for general uh civilian staff and then the police pay increase which we described earlier tonight and then the class plan itself is an administrative document that HR develops each year and that lays out all the positions and the pay ranges for those positions and um and if there are any questions on those we'll answer those and Sharon Gibson is here to do so um or otherwise we'll shift to the other thing that Sharon is here for is the city manager recruitment update.

Any questions on the classification and comp plan changes? Mary Beth,

my my just one question is the I understand why we have the need to increase the police pay so much, but it's a big disparity for the amount of increase other people are getting. And I'm just wondering how how that information is being shared with the staff and how it's being taken. So, uh we had an employee town hall meeting right after the budget presentation. So, um I think all employees are aware of it and are discussing it and um and we'll have another employee town hall meeting tomorrow. So, we might hear some more feedback on that. Um but um maybe Sharon I'll let you answer that question.

So staff have asked can we do a compensation study for their positions to see how they align. I indicated that is something that we could look into. I don't think we need to do a full comprehensive sort of outsourcing for the request. A lot of the data is available and the peer jurisdictions share it with us. It's just finding the time to do that. Um, at the last EAC meeting, I mentioned that I would provide a general highlevel overview in July in terms of the peer jurisdictions, what the process would look like, how we would collect the data. Um, but they are very interested in um how their positions align competitively particularly now with the police pay. You know that that was something that several years ago, the last time we did a compensation study was three or four years ago and one of the things that has been front and center for city council for a long time was ensuring that all those salaries are competitive regionally. Yes.

Uh Mr. Shields, you had originally I think I believe there were seven positions that we weren't going to fill and now it's at five. is that we've restored to impublic in the budget presentation from the beginning there were seven reduced and then five and then two increased and I've kind of not spoken so much about the two increases because they're kind of it's a bunch of positions and it's little positions that are you know were part-time going to full-time or they're adding some hours to them so they weren't terribly impactful okay from a programmatic perspective but they were meeting um some smaller personel and departmental needs. Okay.

Okay. I am cognizant that we are two and a half hours after when we told Sharon she should be here. U at the same time I realize we've also haven't taken a break. Are we okay quickly going through the city manager recruitment letting her go home and then doing the break and sorry Matt that means we push you off a little longer. Okay. Okay. Thank you Sharon. We apologize for the late hour, but

no worries. Um, so to give a brief overview of where we are with the city manager recruitment effort, uh, we have selected a recruitment firm and the contract is expected to be issued tomorrow to the firm for review and acceptance. So the process that I'll briefly describe, we'll talk about um, what our planned approach will be upon execution of that agreement. So, we're first starting with looking at stakeholder engagement, collecting um feedback from various sources in terms of the candidate profile for our new city manager. So, starting with city council having individual one-on-one meetings with each council member and the executive recruiter. Uh I believe we had talked about also having some open feedback um office hours with council so that the community could provide their input and their feedback as well. Uh one stakeholder group meeting facilitated by the executive recruiter. The compensation I'm sorry the composition and the participants in the stakeholder meeting is still under development. We're looking at ensuring a balanced of internal and external representation and then also collecting feedback from staff, boards and commissions and the community. And this would be done via a feedback form that would be designed by the executive recruiter. uh the results and the analysis would be performed by the executive recruiter, but the link and the communication and how it's distributed would be handled through our office of communications. Um and our timeline would want to engage with that as soon as the contract is signed. I mean, I anticipate those meetings, those discussions, the

collecting of the feedback probably would take a four-week process. Um, depending on people's scheduling. So, ideally, if we could do it sooner, that'd be great, but I'm also sensitive to people's availability. Um, so that would be sort of the the worstc case scenario. But immediately upon signing of that contract, that would be the first initiative to collect that feedback, engage in those conversations. And that feedback would help develop the candidate profile, the recruitment brochure, and our marketing and recruitment strategy. It would be a national search. I heard Mr. or so speak in his presentation about the cost. We are looking at approximately $42,000 for this engagement. Um but the executive recruitment forum will be very involved in doing a lot of the um vetting um and sourcing of candidates from an a nationwide perspective. Uh following that I would say our next emphasis would be on the actual recruitment and selection process having multiple interviews both virtual in person um to vet candidates. Uh but that would be sourced um I'm sorry that would be identified more clearly once we have the contract signed in terms of the time frame location and folks who would be involved in that process. And just as a followup to one of the requests that we have, we are going to be sending out uh this week to council the unconscious bias training as well as interview and selection training. Um and also would be having all individuals who are participating in this process to take those training modules so that we

are very comfortable about how we're moving forward um in a very objective and unbiased manner. Great. Thank you. People have questions for Sharon. Just one real quick. Um there's obviously some time periods where we need to be here and available. Do you have any idea yet on those cuz scheduling the summer?

That's a great question. I do have some summer schedules as of right now. So, if we're speaking in terms of the on-site interviews, I think it's going to depend on when the position is advertised because ideally, we'd like to have it open for a period of 30 days. And so, depending on when we actually get it posted, it will give us a better idea in terms of availability. We do have some tenative scheduling, but not the schedule from everyone. and July is looking pretty tight in terms of a availability. So, um that's something that we would be monitoring. We I I can't offer anything definitive right now just because we don't have the recruitment actually posted as of yet.

You think we'll target posting it by like miday, early May? Well, our target um we want to be able to start having the review of candidate resumeumés ideally in early or mid June. So it depends on how quickly we can engage in the candidate profile interviews, stakeholder engagement. Once that's completed, the candidate brochure can be developed. We can get it posted. We can start marketing. So, we ideally would be shooting for late June, early July.

That's helpful. Thank you. Other questions? Uh, two. One is about the budget for next year then because we're going to pay the contractor this year, but as far as interviews and travel and all that, that would be in next year's budget July. So, that's all in there. um for the candidate travel for potential interviews uh that has to be established. Okay. Because based on our timing, it's not going to happen this fiscal year. So evaluated for next year. So I just want to make sure we put enough of that. Yes. Next year.

We probably will have in this fiscal year covered for the on-site interviews possibly. Uh but it really just depends on how quickly we can get things posted. But David looks like but to answer that one, no, we we don't have any of the additional costs built in the 27 budget. So, uh just wanted to clarify. Don't have anything in there. So, maybe we should. So, yeah. So, that's why we have it that's why I requested in the uh 26 results the 42,000. But yes, if we foresee there being additional cost, we'll have to build it into the 27 budget.

Right. Right. Okay. Um Oh, and I forgot my other question. Oh, the firm when when the is signed, will there be an announcement of Yes. the firm? If they sign and accept the contract, we will make the announcement. Very good. And we plan on having it sent tomorrow. Great. Thank you. Other final thoughts. Thank you, Sharon.

All right. Appreciate the update and the work on this. I think once it's official, we'll do our best to make our schedules work with those one-on-one focus groups, too, because I know those are important to get the ball rolling. So, all righty. So, now for that quick break. It's 11:19. Do we think we can get back in by 11:30? 11 minutes. Okay, we'll resume at 11:30. What? Wyatt when he was very ambitious every time.

minute ahead. I think everyone's back. I can go ahead. Okay. So, this is a um discussion uh we'd like to have on the agenda next week a council action to authorize us to enter into a contract with real estate advisory services for Virginia Village and Matt Matusk um has been working with the team on this procurement. So, I'll turn it over to him.

Thank you. Uh good evening everybody. Uh so as you're familiar, we are slowly but uh progressively getting closer to uh partnering with the development team. Uh and to help us do that and kind of figure out what the options are, what's really realistic, what's uh financially feasible on the Virginia Village property, um we want to make sure we approach some of these critical milestones coming up uh later this year with as much support and confidence in making these really important decisions. So, prior to us being able to issue an RFP and have the development community respond to the potential interest in helping us solve that property, what we have done is issued a smaller and more strategic RFP to get real estate uh economic development services uh that look at not just what is potential there, what is the development scenario, but really on the financing side and looking at teams that might be able to help us not just draft the RFP, help us issue issue it, but also help us review it. Uh, so staff from both planning and housing, the selection committee we're going to be identifying, uh, we all could really benefit from another expert in the room to help us kind of understand what we're seeing, help us review and assess in a reasonable amount of time, uh, and be prepared for a pretty broad spectrum of applications that might come in. Uh so part of what you have in your staff report is uh an opportunity to authorize funding to help the city partner with a consultant that has those real estate uh commercial real estate services uh and have them come on board at the end of this month so that we can spend the month of May finalizing uh a draft that staff has already prepared uh of the RFP, be able to issue it um after some meetings we have in late May, spend the month of June uh looking uh at various scenarios and continuing to coordinate with staff and

then the month of July and August as the selection committee potentially evaluates those options. So it's a four-month window. Uh we expect that teams will have various staff uh from their um broad teams to help us with the various elements. There's some construction aspects to this development, financing, real estate. uh it's it's likely going to be a small group of folks that are coming on for four months to work with us and really helping us make sure we make the best decision possible. So, uh in the leadup to next week's action meeting, uh we wanted to highlight what was that scope of work that we issued for the consultant services. Um what is a general budget that I think we're anticipating to use. Uh, and that will allow us following next week's action meeting to have the purchasing agent finalize those uh, negotiations. So, I'm happy to take any questions. I know that we've received letters different than the eventual scope for the draft might look like green space. Correct.

Exactly. And I think once we get into the month of May and a similar report with a much broader uh RFP document, I think it's shared with everyone. We can see very clearly what the difference is. But you're exactly right. And even beyond that, I think what we've been highlighting to the community. We had a couple of meetings earlier this month is that all the feedback that we have collected is intended to go into that RFP document as a direct and more current representation of what the community is expecting on this site in addition to and building upon all the things that we already have in our small area plans. Uh so we're very clear that that is our intent. Staff is actively working to do just that. Um, and it is something we plan on sharing with the consultants once they arrive and begin coordinating with us.

Okay. Okay. So, with that, questions or comments for Matt? Dave?

I do think it would be helpful if you added a reference to the small area plans and um to the community discussions that have occurred so far. Um, and could I have your commitment to do that? I'm not gonna engage in in group you know sort of but I if you could insert that and I and the materials that you provided for the various um meetings were I thought very helpful particularly where you encapsulated what you had heard from the community. So, I'm I'm asking that all that be worked in somehow into this um RFP, which I um assume in reading it, we're not presuming a vertical development necessarily. Um we have a number of affordable units there. And so what we're looking for is a true evaluation of cost and benefit and how it fits in with the surrounding community and how it furthers our housing objectives. So that's what I'm assuming is in here and and that's what I see where I see things like evaluate redevelopment, preservation or repositioning options for the site. So

am I right in you're nodding? Am I right in that assumption? Yes. And uh both efforts uh will heavily involve the questions of what is the best uh initial move that we need to make with Virginia Village because I think there's a general curiosity in terms of the cost of renovations, potential expansion, right?

Uh and uh redevelopment. So I think we need to ask all those questions, be as informed as possible as we get into the summer months. Um and everything you outline I think is representing a active package including uh phase one uh studies of kind of you know with the conditions on the site uh small area plans memorandums we've developed back in November of last year. So all of that I think has been collected including even last summer's affordable living policy and we're going to be handing that over to the consultants and make sure they are up to speed. uh some of whom I believe have even attended some of the recent community meetings just to come become more familiar.

That's great. If you could just add a notation into the overall project or overall description of the um of the agreement, that would be great. Thank you. I had a deja vu moment from when we were about to embark on the high school project because we looked at these like 13 different options between like renovate and expand before we settled on well we actually just need to build a new one and free up the 10 acres and here's the math and here's why but I think that was actually really helpful to kind of like coales around what the right option is at least we can put some other options that have been talked about to bed or evaluate them more closely but it reminds me of that when we said there are all these different things that are floated out there what could we do with the site and it would be good to get an objective point of view what the best one is that meets all the objectives we want to accomplish.

Totally agree. I I would agree too and I would agree with Dave. It would be good to have in there the reference to the small area plan, reference to the work that's been done the understanding that we want to have green space. We want to have mix of incomes. we want to have I don't know you know some may be not uh changed and some may be changed and it's and again there's only so much that can go in this RFP but you'd hate to hire someone who then is like wait you want to keep some of those I didn't get that out of here so I want to make sure that that's in there okay

but thank you other thoughts So, I think I'm going to echo what you got from the EDA a bit. Um, the 175,000 is a considerable amount of money. Um, do we feel like we're getting the value out of this in four months? Is this something that is just really high or I mean is it going to be like a blitz of several consultant se multiple consultants coming in? That's question one about it. And the other one is I see that it's coming out of the Virginia Village Rental Reserve Fund, which has 300,000 in there. Is that going to leave enough in that fund for the rest of its purposes? I mean, what's the balance supposed to be with that fund? So, those are my two questions.

I'll go in reverse order. The fund I think will be replenished in approximately five to six months based on what the city's collecting currently and on an average month how much we're spending in site maintenance repairs. So it is a replenishing account. Um so I think we've asked you know housing staff and others to kind of give us a good look at the last several months worth of expenses and we feel comfortable that this is going to be a smart decision. it is a potential and permitted use that's listed in theou in addition to maintenance and site repair. So um the use of the funds in this manner I think has been agreed upon. The final question which is the value uh and I think because we're not soliciting one individual to help us with this we're getting a team of experts that are familiar with these type of projects development real estate financing. Uh it's a suite of expertise that are coming online for four months and at the various stages of the processes still ahead of us who'll be able to kind of give us not just staff but the selection committee some level of confidence in what are we receiving? How do we make this really important decision the best one that we can for the city. Um and I think there's a certain value to that uh that I'm not sure if he can put a number sign on it. Uh but it it is something that periodically I know we've done it with West Falls. Sometimes those type of costs really are necessary.

I had a similar reaction to art and the EDA conversation. I mean I do think an understanding that there are more consultants in this maybe I mean the staff report seemed to reference that there could be other future consultants like this is the first in a phase of consultants and maybe there would be other consultants for you know legal or what the documents would look like and so this may be a suite of people but this isn't like exhaustive of the people who may ultimately be involved in something like this. Um, and so it may be the first of multiple costs that are going to have to be replenished by the kind of rental income if it's coming out of this fund.

It's hard to tell until we get to the RFP issuance. Uh, it's hard to anticipate how many submissions we're going to get. Um, and I think we're also comparing various submissions in terms of how they're structuring their proposal where there might be a one large sum that might be encompassing all the different services and some might have add-ons which is typical in this type of process. Um, so it depends. It also might be what is our need and comfort level as we go through the process and do we feel like we need additional expertise? Are there going to be beyond the month of August additional contracts that have to be negotiated? Um I anticipate as we get into the second half of the year there's probably going to be additional visits where we have financial agreements that have to be made. Um as we progress closer to our site plan filing. So there is going to be a need. The question ahead of us and we would certainly return to have that conversation is do we need to have an ongoing relationship with consultant services or beyond August do we feel like we can kind of handle that in house? Okay. Um the 175, how much of that is driven by sort of the consultancy and the expertise and of the team that you're getting versus the expedited basis on which we're doing this. So, like, is it double what a cost would normally? Like, we're doing a search firm that's like $42,000 doing a nationwide search with X, Y, and Z aspects of this in a compressed period because we want to fill a city manager's budget. And then at the same time, we're looking for the same four months time frame, you know, $175,000, recognizing that the scope of work is like completely different and there may be complexities to what we're asking them to do, but how much of this is like a 50% up pricing, for example, because we're saying we need to start next week

versus we would be starting on a, you know, six month time frame as opposed to a four time frame.

So, I'm going to tiptoe around purchasing rules because there's only so much we can reveal. Uh what's happening is that there are some things that simply have to be accounted for and we are not getting the impression that proposals are reaching these values because they're throwing an army at the problem because it has to be done in a certain amount of time. Uh in fact there's a separate logical argument to be made where if you've given people a full year or two years to do this the cost would just keep going up because we can study negotiate and just keep adding scenarios. Um I don't think it automatically equates to the cost going down. Um but it it is something that we just simply have to consider and where we find ourselves. Uh and I think the value is really with the help and making very important decision uh and not letting it drag on for too long. Um, in terms of the scope of work, how much of this is like when I read this, I was like, okay, well, we've done some of this. Hopefully, they're not like duplicating efforts or we're not like recreating the wheel with what planning has already done like some of the references to, oh, you know, having X, Y, and Z like conversations, right? Um, some of it seemed to be the sorts of informal conversations you were having back in January, hopefully to figure out was this even worth trying to do on a compressed schedule. So pieces of it seem like predictive in terms of what could we expect formalizing the informal conversations of like being more predictive of what could we expect given the land that we have and then other aspects of it seem to be right like the evaluative we need expertise to be able to assess and pressure test the responses that we get to this RFP.

So I would view it as and I'll try to simplify it for tonight which is the group that we would identify for the consultant services would not only help us in the various stages of developing the RFP issuing it and helping us to review the submissions but while the development community is assessing how they want to respond and finalizing that proposal to us the consultants will be basically acting as if they for one of the developers and preparing their own responses to our RFP and that would establish a baseline that we would then compare against as these submissions come in so we have a better sense of is everybody heading in the same direction or is the consultant seeing something that the developers are not and I think there's a level of confidence that comes out of that exercise because we kind of feel like we have our own developer on the table that is helping us kind of you know share some of the answers insights that we otherwise wouldn't have uh so I don't want to leave the impression that we're only asking someone to come in and hold our hand during some of the selection process. They would be doing a lot of the work that development community would be doing themselves in a compressed time. But that really sets us up sets us up for success once we get to like June and July.

And is this like normal or is normally this phase? So, normally would you have your like pseudo developer doing this before you actually put something out to RFP so that it would help shape the RFP versus how normal is it to have your consultant like answering your RFP at the same time as your respondents? because to me it seems a little like we're doing this at the same time because of the compressed schedule and this is a little out of order from what I would normally imagine in terms of there's an efficiency to getting it to the litec deadline but I would I would think that the consultancy would have come first before we actually put out an RFP not knowing are we taking AB or C sort of option as the best option of repositioning redeveloping renovation, right? Redevelopment. And that you'd kind of want to say like we're in scenario A. We want to see the best options for scenario A versus we want to see the options of A through D.

I would say some of the biggest success stories don't look anything like normal. Uh, and I think we need to be less afraid of maybe encroaching into a new realm where we're doing things very differently. I think this site is forcing us to do some of that. And I think you all have taken very bold moves over the last few years acquiring the sites that you have. Um, and I think these next few months are going to be very challenging for us because now we're actually kind of being asked how serious are we? Um, not that the past few years have been easy, but it's really going to get tricky just like the budget conversations because we have very critical decisions and milestones ahead of us. Um, and from that perspective, you could do it, you know, one way or another in terms of the sequencing of it all. Um, I've seen so many variations. There's no, I think, winning model. Uh but creativity is where I think you navigate the more constrained opportunities like this one where there's nothing ideal about what's happening here. Uh doesn't mean there's not a solution. It's just going to look unique when I think we execute.

Okay, that might I think what might be my last question on the 30-day submission deadline. So given I don't know it seems quick, right? to maybe it's not quick, maybe it's only normally 30 days, but to get a comprehensive response um if we don't get viable candidates in that 30-day period, how much of like the contract price is contingent on like various things? So, we're 175, but like some of this is, oh, well, we want you to evaluate this or help in

July and August and July comes in and we're like like we can't do anything with any of these is do we only pay 50% of the contract price or if the work never took place then yeah. Okay. So, it's like phased in terms of these different buckets. Correct.

Okay. Other questions for Matt? So at the ED meeting, I think they had a strong reaction to the price and I think one of the takeaways was like what are the other options and I assume in the past week and a half staff has looked into other options and we still think that the maximum contract price should be 175 given the contracts we would ride. Is that an accurate summary? particularly since we're using a replenishing account that you know will continue to serve as you know site maintenance and uh repairs for the property. So it's not something that we won't be replenishing in the next couple of months. And if I could just note this was a competitive process from the starting point and while we can't say the details you know it it has been reviewed and negotiated so it's a good price and having done affordable housing for a while this amount of money for the level of expertise we need to bring to the table and seeing some of the other contracts is very reasonable. Were you asking why?

I I would just like to kind of emphasize Matt's points about we've got we do have some difficult decisions. And so I think having team a team with the city that's just going to be looking out for the city's interests. They're not going to get any payout. They're not a broker. They're not going to be pushing us to a deal. So, they're just going to give us advice on um on on options and kind of what it's going to take, I think, for us to accomplish a range of visions that we have for this property. And so, when you think of the complexity of the work and the time frame of it, it's it's um we're getting a team of people in a concentrated period of time with serious expertise that the city needs. And um so I think I'm hopeful that at the end of this engagement the council will say that that was money well spent. I think that's our our view. I can just echo that in the sense that um you know when we when we built Meridian we had an owner's rep and I definitely that's that's what why we were able to deliver that school on time and you know on budget having that owner's rep who made sure we were didn't keep agreeing to things made us staying within that budget and you know and talking with some of the um I guess challenges when they redid the baseball field um one of the school board members said they they should have from the beginning had an owner's rep for that project. So, I think it does it's money well spent and it probably saves you money and headaches in the long run.

Yeah. Help us see around the corner, help us foresee things that we don't have the experience to necessarily know to foresee and and avoid some some possibly costly mistakes. um one suggestion. So under task three, so similar to the feedback about, you know, making sure that we are looking at the whole suite of options and we're not precluding anything. Um I think it says under task three, advise us on the outreach strategies or what? Yeah, advise on outreach strategies to track qualified development partners. I don't know whether this needs to be added to theirs. I'll just make it as a comment and you can consider as part of RFP scope. I think for a long time we wanted to make sure that we're casting a wide net and we're talking to nonprofit as well as forprofit or a mixture of two kind of partners because they might have different ideas and if we're trying to look for creative options I don't want to kind of only limit ourselves to one type of partner as well as the combination of affordable housing as well as market rate players as well. So that's probably more um to consider down the road. But when we talking about outreach to development partners, I wanted us to be casting a wide net to those people. Okay. Any final comments?

I have one final. Um there was the line and I think right this also spurred some of the community feedback on the like advise on I don't remember. I I mean I can find it but um advise on like best use and highest use scenarios for affordable housing goals. Um, and I guess it gets back to where Dave started just like best use and highest use, but I guess we want the range of use, correct? Okay. And so that's going to be encapsulated in the final version of this.

You're going to see and part of the answer I think has to project out to the main RFP that's going to be looking for the development partner where we'll make everybody anxious and that it will be some level of preservation. So, we get the answer to if nothing else happened, can we expand housing with the units we have and in the condition they are, which sometimes comes up and I don't think we're having realistic conversations about the true cost of that, even the execution of that. Um, given that they're almost fully occupied right now. In addition to that, I think we're going to have to be very clear and I think even more explicit than we have been so far about what redevelopment looks like. The common feedback we've gotten from various stakeholders, from developers that we discussed this with back in the winter, um is that the RFP needs to be as specific as possible to get better responses to be able to make this schedule work. Uh so we have to clarify what we mean by redevelopment. Uh we have to clarify how we are synthesizing all the feedback we've gotten from the community. Um, so I I think people when they see that in late May are going to have some strong reactions because for the first time we're going to be signaling what could happen as one scenario or what could happen as another scenario. Um, but both have to be pretty explicit for the work to actually take place. Uh, and I just want to prepare everybody. You know, we're going to have some strong opinions when that information is becoming available.

Sorry, on the fiscals. Um, and I had brought this up in our original work session. And there's like the fiscals for the project and then there's the fiscals sort of like long-term fiscals for the city. When you're thinking about the scope of this consultancy, is it taking both aspects into account?

In what sense? like in the sense that you could potentially have a like net fiscal negative project and then it's just a question about like we currently think about affordable housing contributions as like an affordable housing contribution of X dollars for this reason and it might be that we're not having like affordable housing contributions in the budget in the same way because we've achieved redevelopment on a property but that way of thinking about like affordable housing in the budget and potentially like affordable housing is helping to sustain an affordable housing area, right? That may not show up fiscally in the same way that we look for a like multi-use development to be net fiscal positive but brings other positives and you know helps achieve other objectives. Is is that part is that half of the fiscal conversation part of this at all or is this really about like is it fiscally realist realistic financially realistic for anyone to be able to build X Y or Z?

It's the latter. Uh and that's because part of this assessment and exercise is assuming that if we are still pursuing the model of every building needs to pencil out in terms of the revenue. uh we already know what the answer to that is. We're not doing this so that this building, if there is one here, is going to be able to accomplish that. I view that as a healthy exercise because at some point I think it benefits benefits us all to start elevating from conducting those exercises at a building level and looking at them at a neighborhood level if not corridor level. Uh and I think that's actually going to paint a much more detailed picture. Uh particularly as we get into what are we trying to achieve in terms of a complete community, the benefits of not having people live two counties away just they can commute here to work. The impacts of that which I don't think anybody has a method to quantify but it should be uh those are costs. We just don't have a model for that yet. Um so there's a lot of I think very you know third fourth level uh of you know detail analysis that I think are embedded in affordable housing projects. Um and particularly when we get into more creative opportunities that might exist on the ground floor that support affordable housing but maybe also help the broader community. interesting to evaluate what that looks like not necessarily from how much revenue it's generating but how is it serving the community and how do you co you know kind of value that

no and I take those points and I think it's completely valid and there are things you know we used to hear about from Mr. Hiro when he was on planning commission and sort of thinking about affordable housing more globally and sort of how the contributions and the contributions in terms of percentages of a budget at X amount but just just wanted clarification on the expectations as to that in particular. I think more of it is going to be on how do you make a redevelopment financable and simply getting past the initial marker of can we find the funding to get this thing off the ground. Uh that's really going to be the kind of the hill we have to climb first.

To the broader question though is like are we going to run a fiscal impact model of this project? Like I think we've talked about like that's what we do for most mixed use redevelopments. I don't know whether that's appropriate here and I think as we talk about like revenue share needing a modernization. I personally think that our fiscal impact model process probably needs a modernization as well. So maybe it's a corridor level, maybe it's a neighborhood level, but there are often public policy objectives we want that's not just fiscals. Like obviously that matters, right? But affordable housing is one of those places where you decide to make an investment in it for reasons other than to make money. And so I want us to kind of internalize that because we often have scrutinize every project based on its fiscal impact. And this is one where I don't know whether we should hold that to the same bar or for that to be the only bar.

Yeah. I mean that's the point I'm making. But I think that we also need to be realistic and transparent about the cost of projects and actually think about, you know, how are we funding them or what that means or, you know, how we think about other funding streams to help support neighborhoods that may need support for reasons we've decided to pursue. Okay, those are the final final comments that we all had. Okay, thank you, Matt. Thank you, Okay, it is now midnight, so we can do consent agenda quickly.

There's two items on consent. U there's two items on consent and they're um both related to the um police vehicle purchases that we discussed earlier tonight. And that's all I have on that. Any questions on that? I think the clarification was is this is not new appropriations. You're just requesting contract authorization.

Yeah, this is expanded contract authorization uh because uh we've bumped up against the limits. Um the police department is using some of their underspending of this year to acquire two additional vehicles and for that reason we're exceeding uh the contractual limits. This is under spending beyond the increased revenue that we talked about. This is just department under spending. That's what they're That's right. This just under spending. It's not new revenue. I think Dave's question because Chief Farb presented the you know I need this much onetime money like if they have more underpending could they buy another one and help make a dent in that?

Yes. And so, you know, I think what we wanted to answer that night is like we still we have like a 485k gap of the 650k gap. We're taking a bite out of that, but we still have a 485. But I think we wanted to run a few more numbers before we threw that out. So, we'll follow up to be more precise. Okay. Okay. Anything else on this? I don't think we want to do schedule now. No. Um,

so we're going to go into close session. I guess I had two quick budget related things to see whether there's people that would also be interested in looking to this as we head to markup. So, we had talked about personal property. Um, I don't think we have a need to raise to $5, but I was still interested in changing the relief amounts to give more relief to lower value cars. I know that means that higher value cars have a $6 increase, I think is what the budget Q&A said.

So, um, we'd like to get that docketed. What I'm told by the commissioner and the finance department is it would if the council could do take that action in July. That would sort of sync up with their schedule of finalizing the car tax book. And the bills go out Labor Day. And so, if it could be done in July, that would work out well. It does not need to be done now. In fact, it's kind of awkward to do it now because the it doesn't change the whole revenue because the relief amount is set by the state. It will be revenue neutral. It will simply shift the burden amongst uh you know different classes. Okay. Do we is there a consensus to do that? I mean because we're at 1500 which is low to me. Yeah. Um,

and the only the only caveat I'm going to give is that under MUNS, our current ERP, we're there have been lots of ideas on other policy things to do with personal property, and we feel like those are going to be very difficult with our current billing system, but shifting the threshold amount is doable. We'll talk more about it in July, but I wanted to maybe send a little bit of a message. I think the intent is that if you have a lower value car like can we give you more relief to hopefully but but relief for EVs and things like that. I'm I'm getting push back from the subject matter experts about the feasibility of that.

Um the other one is I think in one of the public comment letters we had it's the big chimneys um water fountain's broken. I think the Cherry Hill one might be as well. Are those like budget repair things we have money for? No, that should be routine. Yeah, I mean that that's that's in the budget. Those are not terrible. That's probably what's going on. It's just in one of the concern emails we got about Virginia Village today said and the big chimneys water fountain doesn't even work. So turn it on and I know the Cherry Hill one is fin. Well, we're gonna have a frost tonight. So now they're being Yeah. Okay. Well, anyway, so let's fund that. Okay.

You got to go cover them with a blanket tonight. Okay. Uh let's go into close session then and we can be done. Uh upon a motion made by and seconded by

and passed by vote of city council, council went to close session pursuant to Virginia code 2.2-3711A7 for consultation with legal counsel pertaining to actual or probable litigation where such consultation or briefing and open meeting would adversely affect the negotiating or litigating posture of the public body. Specifically concerning litigation concerning the development known as Pearson Square and two Virginia code 2.2-37118. 2-3711A88 for consultation with legal counsel employed or retained by public body regarding specific legal matters requiring the provision of legal advice by such council specifically to consult on the prioritization and risks associated with specific but routine legal matters to be handled by the city attorney under the FY27 budget. Aen,

yes. Connelly, yes. DS, yes. Flynn, yes. Snider, yeah. Underh Hill's not here. Hardy, yes. We're going into close session at 12:06.

We have to go to Oak.

and pass upon a vote of city council. Council reconvene in open session. Aen, yes. Connelly, yes. DS, yes. Flynn, yes. Snider, yes. Underh Hill's not here. Hardy, yes. We are coming out at 12:41. This is the certification and then we're done. Upon a motion made by and seconded by DS. And passed upon affirmative roll call vote in open session. It was certified that one only public business matters lawfully exempted from open meeting requirements and two only such public business matters as were identified in the motion by which the closed meeting was convened, heard, discussed or considered in the closed session or meeting by the body. Aen, yes. Connelly, yes. DS, yes. Flynn, Snyder, yeah.

Under Hill, not here. Hardy, yes. Okay, if there's other business, let's adjourn. Good night all. Thank you. Happy birthday.