Fiscal Sustainability Ad Hoc Committee - Regular Meeting

Depending on the type of development that comes in, we always look to get as much infrastructure replaced or repaired with the development. The bigger developments go into a development agreement. So a lot of times we will we can require them to resurface the road, replace our water mains. For example, the Pines development on Euclid and Rosecrans, they are going to pay full width Euclid and Rosecrans on their dime. We're not paying for any of that. So we attempt to get as much infrastructure work out of the developers as we can. It's a bit of a negotiation on most of the projects, but certainly we push it to the limit for sure.

Do other cities have a fee typical for like per unit cost for road repairs or just negotiated?

I don't know. To be honest, I don't know.

Thank you.

So in the presentation, it says that we haven't increased our fees since 2005. Is there any plan on reevaluating that?

Is that in sewer?

Yeah.

Yeah. That's something we've kind of started the discussion internally. Up until probably this year, our SEWR Enterprise Fund has been doing has been able to provide sufficient budget to do our work. We're getting to that point where the operational costs are getting are really cutting into the available CIP budget funds. So we're getting to a point where we're going to have to slow down our our sewer work unless we increase the rates and and gain our revenue. But I think those discussions are very, very early.

There's a question in the chat.

No.

One of the public wants to to is raising their hand to to talk.

The public comment period, I believe, is over.

Okay.

We can respond back later. Okay. Okay.

I I have a question.

Good evening, everyone. Can you hear me okay?

Maureen. Yes.

Oh, hi. Maureen Milton, independent advocate for the disabled, handicapped, mobily challenged, little people. What I was wondering with fees and this has been going on for since the beginning of mobilization. Do are the cities allowed to charge truck companies for, you know, like 18 wheelers? Because there are certain roads that they can only use.

And I just wondered if there was fees that you could charge. It's almost an impossibility to keep track, but I just thought I'd ask because it it is a possible income. So, anyway, that was my one question for now. Thank you so much for accepting my call. Bye.

You want me to attempt to answer that? I'd say in general, a city can attempt to create fees on anything. With a truck, I think that would be very hard to implement because you just don't have control of who's coming in and out of the city. We are looking at a trench cut fee for utility companies or anyone who is cutting the streets, kind of a square footage fee. So they will since they're damaging the street, they're going to pay a fee, to help us offset the future repair of that street.

I have a question. Can we go back to the PCI slide?

You want to

park it? So you had mentioned I would agree with you that the local roads, the pie chart, you'd probably want it to look more like the arterial roads chart and it was very difficult. Why? Is that a financial concern

or It's two things. It's obviously the revenue, but it's also time because there's so many miles that you have to do. You're you're there is a practical limit to how much work you can do a year. So it you can't do everything in one year to get to get out of the very poor. So it will take time and it will take money to to get it out of there.

Is there a part of Fortune that is more concentrated with the very poor roads?

Shockingly, no. It's actually pretty spread out when And you look at it, then just I mean, I

have my own sort of thought about what a very good road is or a very poor road is, but what are the how would how would you identify that?

So a very good road is something that we have reconstructed or repaid probably in the last six months. So if you if you've gone to Row, Orange on the East Side of town, we just finished that probably about a month ago. But also Orangestalk between Harbor and Lemon was done about a year ago. That's still a very good street.

And as it pertains to residential road or something that's not arterial?

Oh, it's the same thing. You know, so for example, we just paved, the Hamosa area, by the Hamosa Elementary, during last summer. Those are completely repaved after a water main project. That's considered a very good road and the residential roads, residential streets around it.

Okay. So the next question I think is the next slide. I think it's the budget slide. Dollars 9,000,000 to $10,000,000 is more or less what it would cost to kind of keep the pie charts more or less where they are right now. Our budget, think in the earlier slide is $8,000,000 is that right?

Thank you.

So along the same lines from year to year, what is the percentage increase to even maintain what we have?

That's what the PMP does. I think it it's a little tricky because some you know, if we our budget has been going up the last couple of years, which is great. So hopefully, our maintenance cost comes down a little bit with it. It's kind of a chicken and the egg type thing. Depends on how much your budget is, how much work we are able to do, what type of work we're able to do will factor into how much it's going to cost, to maintain it.

Thank

you, David. Okay. Yeah. Okay.

There was a question earlier about an impact fee an impact fee in other cities doing an impact fee on roads. So some cities do do impact fees on roads. I've actually worked in cities where we did impact fees on roads. But there has been recent, Supreme Court ruling. I think it was a Supreme Court ruling, which limits what you can do for impact fees to make sure that you are equitable in how you treat it.

So there's a higher requirement as far as doing impact fees. And impact fees on roads typically are for, like, new traffic lights or new roads that the new development is impacting and creating a new it's usually not for what we call maintenance or repaving the road. It's usually for creating a new road, creating a new lane, creating a traffic light. That's what they're usually we do it in a different way here. We do, like, we attach it to a development plan or a development in or a development agreement.

That's another way you go at impact fee is through a development agreement or or a plan when they submit their plan for their development. You can do it through that method or impact fee, you usually shouldn't do it through both.

Just my general thoughts on on fees related to developments. I can remember back in the day when there was no school impact school fees. I know back in the early '80s you could pull a permit and you didn't have to go to the school district to pay them to get your letter to give to the building department to show them that you paid off the school district and then they came up with this new school district fee even as school enrollment was going down and the fees were going up. So you know as time goes on it might be something to consider for the future Fullerton's future because I know we have been mandated now by the state to over the next I don't know what thirty years add another 13,000 dwelling units maybe that might be the time to instill a cost per unit fee. I know I'm sure it's the city council direction to do something like that.

I don't know. Is that something is that something you have to go to the vote of the people, or is that could be a city council vote to impose a development fee for, like, road development tax or whatever? Do you know?

Development impact fee, you can go to city council, but you have to have usually a study done by an outside firm that shows the justification of how the developments are going to impact and create either need for new lanes, need for new roads, or other things such as traffic lights or other types of things because, the impacts are creating

on the road. Right. The new

But that that is a city council Right. That's a city council decision. But a lot of states that used to do a lot of development impact fees have had to bring them back because of some recent court ruling. Not recent, but court rulings over the last five years, let's say. And I've actually been in a city where we were actually sued on a development impact fee, not on streets, on a different area.

Infrastructure, we were sued and successfully sued on a development impact fee that they felt was too high and was unfair to developers. And so we had to pay the developer so much in the millions of dollars. So so I've I've seen both sides of it. And it wasn't a fee that I was there when it went into place. This was a fee that I've been in for a Yeah, long

I'm not a big fan of taxing people and making them pay additional fees. But at some point, when the state is mandating another 13,000 units, I think that would be the time that perhaps a road fee citywide would make some sense. Thank you.

Okay. So moving on to, some budget balancing options. This slide here kind of outlines the fiscal challenges. This was presented at a prior ad hoc committee meeting. But just to kind of recap, we as David had mentioned, costs for everything have gone up.

Inflation has been fairly high the last few years. So the city had renegotiated labor agreements with all of its bargaining groups. In addition to that, the pension unfunded actuarial liability that outlay of cash every year continues to increase. That UAL, just to recap, is primarily captures the liability for existing retirees that are primarily classic members and the bulk of that UAL was kind of that liability was developed prior to PEPRA taking place. In addition, as David had indicated, you know, the city has a lot of aging infrastructure, not just streets and roads, but a lot of the city facilities as well.

So we have come up with a few kind of budget alternatives that we wanted to kind of put in front of the committee for discussion and input on. One

of

them is pension obligation bonds, and I'll go over that. And then I'm gonna hand it over to Steven Avalos to cover the city's infrastructure fund as well as enhanced infrastructure financing districts also known as EFID. So with that, I'll go ahead and and start into pension obligation bonds. So this is one option that was brought forth to city Council a few years ago. This And obviously, the market condition has changed right now.

The interest rates are really not conducive to a pension obligation bond. The municipal bond rates would need to be at least 44.5% or lower and they're not at that stage right now. But this might be something, for the committee, executive management as well as city council to kind of keep in mind, should an opportunity arise in the bond market again. For the city, unless that we were able to yield 2 plus million in annual UAL savings, it's not something that, I think the city manager's office or the executive team would be looking at, evaluating. At one point when interest rates were historically low, city council did approve, moving forward with the POB, but we were stuck in with the court systems in terms of the our judicial validation was challenged.

So we kind of pulled back on that. But this is something that has helped a number of agencies. But I will kind of go over the GFOA advisory POB risks that they've outlined and what a lot of agencies have done to mitigate those risks. So this is also another slide that we had previously shared. The city's annual UAL payments is about $23,500,000 in fiscal year 'twenty four, twenty five and for 2526 it's projected to increase to about $25,900,000 These numbers are slightly different on one of the next charts because with CalPERS they allow us to prepay the payments to them, our annual payments to them at the beginning of the year which saves us about $600,000 in interest payments for that particular fiscal year.

So this next slide is we pulled from the CalPERS actuarial report. You can see their history of investment returns. So and when they create the UAL, they kind of peg what their investment returns are going to be. Currently, that investment return number is about 6.8% and you can see the discount rate change starting in 2004 was about 7.75%. That's how much they had anticipated investment returns to be and they've since dropped that down in 2021 to 6.8%.

So you can see that there is quite a bit of investment return volatility resulted from CalPERS' investments. Those gains and losses, investment gains and losses do directly impact every agency that's part of CalPERS in their annual UAL payments. So if they have a significant gain or a loss in any particular investment year, that gain or loss is amortized over a five year period. So they kind of call it a ramp up period. So they layer in those increases not over in that next fiscal year but over a five year period.

So it kind of smooths that out slightly. This is a chart that we previously shared but this has been updated with more recent numbers. So you can see that the UAL payments for both the miscellaneous as well as the safety groups continues to increase. At the peak in 2030, we're looking at making a payment about $34,800,000 So from kind of current to that peak, that increase is quite significant year over year and that's putting that's where that additional pressure on the general fund budget is coming from. So in terms of the risk for doing our pension obligation bond, the GFOA's advisory guidance was issued ten plus years ago.

I think it's like fifteen plus years ago now. So these are some of the risks that they had outlined with doing a pension obligation bond. And I just wanted to kind of bring it to the committee's attention. The next few slides will go over each of these along with what municipal advisory firms as well as agencies have done to mitigate the risks that have been highlighted by GFOA. So the first risk is essentially that these are obviously very complex instruments and some agencies were incorporating guaranteed investment contracts, swaps or derivatives, which are very, very complex.

Recently, since the advisory was issued, most agencies have switched to issuing just plain vanilla fixed rate bonds. Would allow us to do is essentially hopefully refund at that 4.5% or lower interest rate versus the 6.8% that essentially CalPERS is expecting us to kind of pay them. That's that interest rate. So it's almost like taking refinancing your mortgage payment. That's one example a lot of people use.

One additional the second risk that GFOA had outlined was that previously some of the pension obligations bonds were issued with make whole calls. What that essentially means is that when you issue debt, municipal bond debt, the bondholders are guaranteed to make to and that when they invest in those bonds for all the future payments until maturity. So if the city wanted to pay off early, you could do it, but you're paying all that interest early as well. So the bondholders don't lose out anything. So p o pension obligation bonds have obviously changed.

So we're they built in like ten year optional redemptions. So it allows us if the rates are more favorable at a certain period of time, it allows us to call those those bonds early and refinance again or pay down if the city should choose to do that. Risk number three that was identified by GFOA was that some agencies early on with pension obligation bonds were incorporating their normal costs. As we had indicated previously, our payments to CalPERS are comprised of our annual UAL payments which was on that slide before of that 23 point some odd million dollars. In addition to that, both the cities and the employees contribute every pay period a certain percentage of their pay and that gets remitted to CalPERS.

That's so the so that's for existing active employees are kinda contributing to their future retirement similar to Social Security because most government agencies do not pay into Social Security. We essentially pay into PERS. And previously PO were issued with normal cost as well as the UAL since the advisory because normal cost do fluctuate over time and the CalPERS formula does can fluctuate as to what percentage of payroll we do need to remit that most agencies have pulled out and only refinanced the UAL portion of the debt. Mandated by CalPERS. So refinancing this debt doesn't change that hard to a soft liability.

Risk number five is essentially a risk that somewhat still kind of exist even with issuance of, POBs. This is what they call market risk, market timing risk. So, it's, if the once we issue the POBs, if the proceeds fail to earn more than the interest rates over the term of the bond. So this one, the CalPERS, the impact of POBs depends primarily on two variables. Let me see.

Sorry. Can't really see this one. The borrowing rate on the bonds as well as CalPERS investment performance. So essentially, if you borrow money, like you issue the POBs and you pay it all to PERS and then they have a really bad investment year thereafter, that's some of that market timing risk that this slide speaks to. I think that's pretty much it in terms of the risks and some of the mitigation that we, like most agencies, the municipal advisory firms have kind of built into addressing the concerns from GFOA.

If there's any questions, I'll take them now. If not, we can move on and we can always circle back at the end. So I know that's a lot of information. Okay. With that, I will hand it over to Steve to talk about the infrastructure fund.

Thank you, Ellis. Infrastructure fund is another option for consideration as a budget balancing option. First on this slide, here's some background. The infrastructure fund was approved by ordinance number thirty two eighty four by the city council back in June 2020. What the fund does, it it redirects and requires the city to, remit 50% of annual increase of the city's sales and property tax revenue above a baseline amount to the infrastructure fund for any infrastructure improvements.

So as David mentioned earlier in his presentation, it could be for any city infrastructure such as facilities and even streets. Next slide. One option is to temporarily suspend the IF, fund count capital contribution for a year or even more than one year. This requires is a four fifths vote by the city council. In doing so, this would enable the city to apply, 2 and a half to 3,000,000 of of of savings of of funds towards the general fund, and it's, any operating debt, deficit or or the fund balance.

The risk with this, we'll face a potential risk of not meeting our Measure M2 benchmark or more commonly referred to as MOE as we're required to the city is required to spend money a certain amount of money on streets and roads. Next slide. So this slide shows a chart of the city's general fund infrastructure fund contribution from inception. So to date, the general fund has diverted approximately $10,200,000 The chart on the right, it just shows the same breakdown, each fiscal year and by the amount of property and sales tax, that contributes to this revenue. Next slide.

So David covered this a little earlier in the CIP presentation, but for the infrastructure fund, in fiscal year twenty four, twenty five, we utilized $2,000,000 for streets. We utilized $650,000 for facility improvements as well as $250,000 for ADA, American Disability Act improvements as well.

Next slide.

To summarize, by temporarily removing the restriction, this would, divert about approximately 2 and a half to $3,000,000 back to the general fund. This would also give city council annual budget discretion to address the deficit or any other city needs. Also to, you know, as I kind of mentioned before with potential risk, you know, there's a potential risk of our inability to meet our Measure M2 benchmark obligation for critical transportation funding. Okay, next slide. So another option with little or minimal service impact is to consider an enhanced infrastructure financing district or EIFD.

So what is an EIFD? EIFDs are special districts with, defined boundaries, that utilize local property tax taxes to issue bonds to fund infrastructure projects. This doesn't necessarily mean, this is not a new property tax or this doesn't, entail utilizing existing property tax revenues for this. What EIFDs does is that it it utilizes incremental increases of property taxes that are generated and spurred by the new development that it would support. Next slide.

For to to So form an EIFD, there is no public vote. The city council can vote to form an EIFD. There is a vote only if the city will be issuing debt to support the infrastructure, and this would require a public vote in which 55% of the voters must approve. Typically, EIFDs are formed to support a variety of community and regional based infrastructure projects that spur private investment and development. Next slide.

So slides three and four kind of cover the, you know, the technical elements and process to form a EIFD. So this first slide shows how the property tax increment would support, you know, the projects or or the financing to support the debt service. So as you can see on the chart on the right, you know, there's a certain baseline revenue. And, each year, as development happens and grows, there's a tax increment. And what the EIFD would utilize is that delta, that tax increment to support either the debt service or the financing of the project.

Next slide. This next slide shows the formation process in steps. So again, this is a lot of information for you guys. We're happy to provide any any other supplementary materials on forming an EIFD. But, you know, this is another option to help fund development in the city.

On this last slide, of course, there's always a risk or pros and cons of doing so. You know, one such risk is a pent potential loss of property tax increment. So essentially, the, you know, the property tax growth that development generates, you know, would be dedicated and pledged to support the the debt service of that. And it otherwise, it would not go to the city's general fund. In addition, where where the the property tax increment revenues are not enough or they're not growing in line, then essentially growing in line to support the debt service, then essentially the general fund would have to cover that delta and that increase and burden that debt service.

Thank you, Steve. I just kind of wanted to touch base on Slide 38 again. So as Steve had indicated, so once an EIFD is formed because the purpose of forming the EIFD is to do some critical infrastructure that's supposed to spur development. When development is spurred, the goal is then to obviously increase your assessed valuation base. And that green area is what's supposed to I guess, those critical infrastructure improvements as development continues, as the tax assessment increases, our tax increment continues to grow.

That's the thought. So this is very similar to redevelopment. Right? If for those of you who are familiar with redevelopment before it was dissolved. So, as Steve had mentioned, there is a risk that, if your the infrastructure improvements that you've done don't spur additional development and that tax increment stays somewhat flat or doesn't grow to match the debt service payments, general fund would need to subsidize those payments, which could potentially add additional burden on general fund because that that difference in that green section would is being diverted for debt service.

It's not sufficient. And then in addition to that, the general fund would need to cut in. Depending on how the districts are formed, you could have some inequality of certain types of infrastructure projects depending on, which districts, vote for those to issue that additional debt and depending on what if certain districts say they don't want it to move forward with issuing debt for any of those critical infrastructure.

Question. Is Amherst Heights an EIFD?

It is a community facilities district. So Amherst Heights, they had done two they had established two different community facilities districts to, I guess, support developers financing some of their infrastructure costs. So it is a district but it's slightly different because the developer essentially pays that debt service. That obligation is not an obligation of the city. It's a conduit.

So any AFD would be voted on?

By the district, By district. The landowners in the district itself. And those those projects are kind of public purpose projects. Uh-huh. But it it that is an obligation of the city. Whereas a community fill facilities district is an obligation of the developer.

I see. The districts you mean the the like in Fullerton we have five districts or would they be precinct?

You I think it would depend on how city council draws the the guess the area in which that district could And be I think you could I think some agencies back to redevelopment, they had essentially said their entire city was part of the redevelopment zone, kind of similar.

Yes.

All

right. If there's no other questions, I'll move on to some expenditure reduction discussion. May I

ask a question on the infrastructure fund? Just to be clear, that I'm aware that if we rescind the infrastructure ordinance that we could run afoul of the, I guess, M2 benchmark. What is the M2 benchmark?

If you don't mind holding that question, I'm going go over street financing at the end and I think I have a table that kind of walks through how much we spent on street, what the MOE benchmark requirement is and where the potential shortfall looks like. Hold that thought. Expenditure reduction. So I'm going to kind of go over some slides that we had previously shared with this committee and then we'll kind of go into what some kind of cuts, the impact of those cuts would potentially look like. So in our previous presentation, we had shared kind of the different areas for general fund expenditures, the breakout of general fund expenditures across certain different departments.

So general government which includes administration, administrative services and HR $6,200,000 public safety which includes fire and PD 34.8 and 61.6. So you can see about 72% of the general fund budget is for public safety. We also have community economic development at 7.1%, public works at 11.3%, and human and leisure services which is primarily our parks and recreation as well as our library services, that's at 12,000,000. So total general fund expenditures is 132,900,000.0 for fiscal 2425. That's what was adopted in the budget.

This breakout is that same January, but it's kind of by service area, so it's slightly different. Public safety remains the same at the $96,400,000 Community and community development is kind of broken out in two different areas. They have building, planning, and permitting, and public works has building as well as public works permitting. And that 3.3 and that 1.5 is kind of their fee for services. So these fees are not something that you can charge all the residents in Fullerton.

These are individuals who are looking for that type of additional service, and they pay for those fees. City council in the last few years well, I guess staff in the last few years had been, reviewing and, updating, their recommendation to City Council to increase the fee recovery for these services and City Council did vote to approve those in the last few years. Prior to that, our, we were providing a lot of services but the fees because they were a little bit low weren't covering the cost for those. So that meant that general fund was subsidizing those additional costs. I think we're much closer to cost recovery for the building and planning as well as the public works permits piece recently.

In addition to that, I think committee member Bouchal had asked essentially what the cost is to maintain, like do some just plain maintenance on streets, landscapes and medians, parks and trail maintenance. That cost is about $6,400,000 that's what was budgeted for fiscal year twenty four-twenty five. The next is we do we spend about $11,900,000 for our library as well as all of our parks and recreation. In addition to that we have lastly which is the administrative cost at 13,200,000.0 is a bit of a catchall. And you can see on the left includes administration which is our city manager's office, administrative services which is my department, human resources, public works and CED administration, code enforcement, economic development, as well as building maintenance and general general engineering.

So that kind of rounds out the different service areas that are funded by general fund. The city we don't make or sell anything, we are a service delivery organization. So that being said this slide is a little bit kind of goes back to more on a department level. So what we did want to share was if we were looking at a 5% across the board reduction in general fund this is what that number would potentially look like. If we did an across the board 5% across the board reduction we would look at yielding about $6,600,000 in savings and a 7.5% across the board reduction would be $9,900,000 As indicated on the right side of the slide because we are a service organization, the bulk of our costs are labor.

So in order to yield this level of savings it would primarily be staffing reductions. And when you start cutting staffing reductions, looking at staffing reductions, you're looking at service level impact. So there's a cost benefit to looking at cuts where, I guess, the labor force is impacted because the residents and the businesses, they want the city to provide those services. So that's the offset to that. Let's see.

This slide kind of is a slide that we had previously shown I think to touch on some of the items that Steve had mentioned earlier. As you can see that in that middle area under transfers out, the city council had approved with their 2425 budget to approve $1,000,000 of additional general fund monies to be allocated to street improvements. And as David had kind of So if we were to temporarily suspend the infrastructure fund, that 2,900,000.0 would remain in general fund which would have reduced our operating deficit down to about maybe about $6,000,000 rather than the 9.4 which is what we adopted for 2425. Okay. That being said, I'm gonna go ahead and switch gears, actually unless anyone has any questions about what we've covered so far.

With that, I will hand it over to Steve to kind of go over some of the revenue enhancement opportunities that we've previously shared with this committee.

So I won't spend too much on these slides as we did cover some of these in prior presentations. But the first slide before you, we do, know, revenue enhancement opportunity. We do have the add on sales tax option of 1%, either a half percent as well as quarter percent. And this can be dedicated sales tax measure, which is essentially earmarked for a special special or specific purpose such as public safety or infrastructure. And this would require 66.7% approval or two thirds voters approval.

General add on sales tax which can be applied to any general service, that is a 50% plus one vote for voter approval. And then another revenue enhancement option, we presented, I believe, the first presentation is the transient occupancy, tax that are known as TOT. And this also requires, 50% plus one voter approval. I believe we provided this chart at the last meeting, and, this chart shows what each option would generate either for a general or special purpose. So, a 1%, you know, sales tax essentially, is a rough estimate of doubling, you know, our current sales tax revenue about 30,500,000.0, then a half cent sales tax would equate to about 50,000,000 and then a quarter would be 7,700,000.0.

Next slide. So in summary, a sales tax add on would generate anywhere from 15 to 30,000,000 to the general fund or for a special purpose. If this option is, you know, essentially recommended successfully recommended and, you know, taken to city council and approved by the city council. This would likely be an option for the November. And also with that being said, this wouldn't begin to benefit the city towards the tail end of fiscal year 2627.

So part of the risk, we won't start seeing any enhanced revenue for about two fiscal years. Another risk is that this, you know, this add on sales tax revenue would also be subject to the infrastructure fund and diverting, you know, 50% of the increase, for infrastructure and projects. Also, a risk if it's deemed a special purpose sales tax and and not a general purpose independent of what the purpose is. This would not help the general fund, you know, general deficit and fiscal issue would likely persist.

Steve, if I might add. So I think when the city council had approved the infrastructure fund ordinance, it was at a time that the city was about to place, I think it was at a 1.25% sales tax measure on the ballot. And I think some of the concerns at the time from the city council members was that they wanted to ensure that a good portion of that sales add on sales tax money would be dedicated or restricted for streets and roads. That sales tax measure ballot did not come to fruition. So that infrastructure fund is putting an additional strain on general fund because it's it's restricting a portion of it automatically for infrastructure.

Alright.

Does does that require a four fifth majority of the council to put it on the ballot? Or is it just

It is a

four Thank you.

Yeah. And and the last, revenue enhancement option or opportunity is looking at the city's TOT rate. The city's current TOT rate is 10%. Any enhancement option would likely increase this rate from 10% to 12% or or higher or, you know, whatever is, you know, designated and recommended. And this would generate approximately 400,000 to $600,000 in annual revenue.

And to clarify for a for a general sales tax, it's a four fifth. For a specific tax, or a dedicated tax, like if we just did for infrastructure, which takes a two thirds vote of the public, or if you just did for a narrow public safety, which is a two thirds of the public, I think that's a simple majority of the council.

Thanks, Eric.

Does the the TOT, I know it's not as much money as the sales tax, but is that also subject to the 50% for the infrastructure?

No, it is So what the infrastructure fund ordinance does is it takes it takes it and the calculation for the baseline which resets annually is secured property tax and sales tax. Right. So moving on to Street financing. So as David had indicated, additional revenue is definitely needed for streets and roads. And I'm going to kind of go over some of that Street funding history as well as that forecast and we can talk about the what the MOE benchmark looks like and then we'll talk about the street financing option.

So Slide 54 essentially kind of breaks out the street the city's street funding history for the past few years. That first row is essentially all road related expenditures that includes some maintenance expenditures that don't necessarily they're maintenance but they're not, kind of capital improvements to that street infrastructure. That second bolded row is the amount of money spent on infrastructure related spending for streets and roads. Down below underneath that section, have where the funding for those streets and roads have come from over the past few years and where it's projected to come from in future fiscal years. So as David had mentioned, we get money from M2 which is OCTA.

We also get roads from SB one. So in fiscal year 2425, we received 1,500,000.0 from M2 money and then 3,500,000.0 for SB one for roads. We received a $100,000 from gas tax. In the prior fiscal years, City Council had approved to dedicate our to allocate about $13,100,000 to road improvements and that's what's seen in that $2,100,000 in fiscal year twenty twenty one, twenty twenty two, 5,500,000.0 in twenty twenty two-twenty twenty three and the last of the ARPA of 5,500,000 twenty three-twenty twenty four. So starting with twenty twenty four-twenty twenty five there was no additional money coming from ARPA because that subsidy hasn't been fully allocated available for roads going forward.

CDBG periodically has had funding available for roads, none in fiscal year twenty four-twenty five but were projected to have about 350,000 for street improvements in 2526. In addition in 2425 there was no federal, state or county grants that were awarded so we didn't have any of that money for fiscal 2425. But we are projected for twenty five-twenty six to have about $6,000,000 for federal as well as $7,000,000 from state grant funding to for road improvements. Down below is kind of what we use to calculate our MOE eligible expenditures. As David and Steve had indicated, the city the MOE funding is supposed to supplement not supplant the city's obligation to spend money to maintain its roads.

Because of that, the the there's only certain types of expand and OCT mandates that only certain types of expenditures are eligible to meet that MOE benchmark. That MOE benchmark is that blue highlighted road towards the bottom. That's the amount we are mandated to kind of spend every year. And in that green row, that highlights how much we have spent that are MOE eligible. I don't know if that, Chair Smith, I didn't know if that answered answered your question.

So as you can see, and as we mentioned earlier, general fund had contributed, city council had, approved in the budget to supplement not just the infrastructure fund of the 2,000,000 for Streets and Roads, but also input an additional $1,000,000. We're still in the early phases of developing the 2526 budget. But right now because there's no general fund obligation, additional obligation for streets, we're looking at a shortfall of about $900,000 If City Council designates at least that $900,000 for street improvements, we'll be able to meet our MOE. And if not, we will be short and then we would lose about $3,500,000 in MOE and Measure M2 funding per year. Question

about the sanitation funds. I noticed in 2425 and continuing, there's no funding for that. What what is that sanitation fund? What was it going towards? It's like David?

So sanitation funds is drainage related. So a lot of those funds were used for street sweeping, curb and gutter repairs, sidewalk repairs. The reason it's not being used moving forward, there are questions as to whether OCTA moving forward will accept that as a general fund expenditure. So we're trying to be a little more conservative and make sure that we don't use those and be subject to audit issues with OCTA.

Yeah. Some agencies I believe that had been audited that were found to be using nondiscretionary monies for as submitting nondiscretionary funding towards m m MOE eligible expenditures were dinged and they lost OCTA funding for a few years. There is some question about whether or not sanitation funds are truly discretionary. And for that reason, I guess, out of abundance of caution, we have decided not to include sanitation fund spending as part of their MOE match, if that makes any sense. We are using sanitation funds, but it is just not going into the calculation when we submit to OCTA to meet our MOE requirement.

So moving on then. So one item, one option that was previously presented to city council was potentially looking at street financing to help kind of raise the amount of spending on streets kind of going forward. So I'm gonna kinda go back to this slide. So as you can see in that top bolded row, the amount of spending on streets has increased which as David had an indication had indicated has increased our overall PCI index for the city. And primarily that was a lot had to do with the amount of ARPA money that was dedicated to street improvements.

As ARPA has kind of kind of moved out and is no longer has been spent and is no longer available unless we continue to get, you know, federal, state, county grant money, that amount of money that the city is able to continue to dedicate towards street improvements will continue to decrease because you see a little bit of a fluctuation there. So in 2425 there was no ARPA money for streets. So we went from $19,600,000 down to $8,100,000 In 2526 we're hopefully going to bounce back up to closer to 2019 with the additional money from federal and state. But back in 2627, it's too early to tell. But if there's no other additional grant money, and because general fund is operating at a deficit and is is projected to do so in the foreseeable future, our projected road expenditures essentially drops down to 5,500,000.0.

That is also at risk because unless the general fund able to allocate and dedicate more money to meet the MOE requirement, we would additionally lose, 3,500,000.0 from m two. Yeah. It's what's being shown on screen. So that if we're able to address that MOE shortfall in that last row, we'll be able to main that maintain that 3,500,000.0 going forward. If we are not able to find additional general fund monies to meet our MOE eligible expenditures, we would lose that 3.5. It's not 3.5? Oh, it's being removed. Sorry. Thank you. Okay.

Sorry. 1.5 or thereafter. Okay. Thanks, David. Okay.

So one option we had and some of the numbers on the next few slides are a little bit outdated, because we presented this a while ago and I haven't had a chance to update them because we really don't know whether their committee is interested in staff kind of evaluating this further. So one thought was to issue about $35,000,000 in debt service which would help which would have helped us maintain like $14,000,000 every year to dedicate towards street improvements. That would kind of bring that number up to about 14,000,000. And but the risk of that is at a certain point if we issue debt that would be obligation of the general fund. If there's no new revenue enhancement, we would be somewhat handcuffed or crippled not just by the debt service but the fact that we would also likely lose our M2 funding going forward.

But this would be a temporary solution should it be supplemented by some additional revenue enhancement. So if first bit be $5.26, 9,500,000.0 in 2627, of 09/2025 in 2728 09/2025 in 2829. By obviously dedicating debt issued money from debt service to street improvements, we would be able to meet our MOE requirement and thereby not just improving our streets because you're allocating more money. But

but

it's not don't think yeah. Because they calculate a percentage of general fund revenue, but this would not be revenue because it's it's a liability. Yeah. Yeah. So this was one option that, was brought forward, so we wanted to present it to this committee as well.

As kind of indicated on that prior slide, if we're not able to identify additional general fund, money and dedicate it towards street improvements, we would be looking at an MOE shortfall going forward which would also jeopardize that M2 money so that we would lose about that 1.5 going forward. And with that, this is just kind of a recap of the what we had previously discussed with respect to Street financing. Does anyone have any questions?

Did you explain to me when you're talking about issued debt? Like what are we really talking about?

Yeah. So what we would do is we would go out to bond for about $35,000,000 and then that $35,000,000 would be used in that orange row over a period of time to bring our street improvements up. Once our street improvements are increased, it takes less money to continue to maintain maintain them. Them. So there's it's a little bit of an inverse relationship.

But you spend a lot of money, the road conditions improve significantly. It does you could do those slurry seals to maintain them rather than doing the grind and overlay or that full reconstruction. So one thought is that if we were able to issue debt, 35,000,000 is probably what we could comfortably if we stretch to make those debt service payments, bring the road conditions up to a certain point. But as David had indicated, we need 200,000,000 to bring all the street conditions up. So I think this was one option that was kind of put forth in front of city council fairly early on before the ARPA had started changing that trajectory of what that PCI index kind of looked like for the city overall.

But as David mentioned with our residential streets, we still have a lot of needs there.

Just make one other comment on the M2. I'll just kind of pile on here. So we the city gets about $3,500,000 of M2 every year. We would lose that entire amount. The 1,500,000.0 is allocated to roads, but we also allocate, M2 to traffic projects and also as a little bit to staffing. So yes, we lose 1,500,000.0 to streets, but we'd actually lose $3,500,000

Thanks. I got confused with the S3.

And does are you able to get that back the next next fiscal year if your budget meet the threshold?

Yes. Once you get back in compliance, the money flows again.

If we did, let's just say the 1% sales tax, 30,000,000, dollars 15,000,000 of that would then have to go

To the infrastructure.

To the infrastructure. Maybe the MOE goes up a little bit, right, just because the But way that it you're probably at that point more pretty safely in compliance for the years to come.

Yes.

Okay.

And just to add on, the MOE actually increases every three years. So that's why from '23, '24 to 2526, it's about 4,900,000. And then in the out years of forecast, that increases to 5.5. So, you know, that's what's kinda driving the shortfall increase.

But to your point, chair Smith, if sales tax measure was approved and is is successful in a subsequent reset or calculation, the MOE benchmark would increase. But at that point, you would have the 15 plus million of sales to add on sales tax money to dedicate to meet that. And your road conditions would also improve. And

you still have a short term problem in the next couple of fiscal years. Right?

Discussion? That I think we're looking then for, if you would like to continue discussion. I know we threw a lot of information at you today. So maybe at the next ad hoc committee meeting, if there's something you'd like us to kind of focus on and bring back, or we could just have some discussion on some of the topics that we brought forth today. So I think we're looking for input from the committee at this point, or next meeting could just be discussion of what we've already reviewed so far.

I mean, I would be open to discuss. I I can't spend an education for me. I actually really appreciate thoroughness of presentation, all the presentations, but I I can't No.

We understand.

Offhand know of any more sort of things to enhance revenue or to cut expenses. So

And I think if, any of the committee members have kind of questions prior to the next meeting, if you'd like to shoot them over to Noah, we'll start we'll work on we'll do our best to get those that information put together before the next at home meeting. So if there's nothing else today, I think we would like to try to schedule out some future meetings. And in the interim before the next meeting or thereafter, if you have any questions or anything else you'd like to bring forth, we'll work on putting those together. Together. So based on discussion looking at availability for council chambers, the dates on screen are available in March so I thought we can maybe start with one of those dates.

I don't know if you Eric, do you wanna look at maybe doing two meetings in March or just one meeting in March? I just don't know what it depends on what I guess, the committee can tell us what works for their schedule. Did we put the dates wrong? It is Thursday, the sixth. Sorry about that.

We're looking at Thursday, the sixth. Yes. Does anyone have a conflict with any of these? Is is there a preference for any of these dates? Would you like to do more than one meeting in March?

Okay. Okay. Okay. So we're looking at March 13 for the next ad hoc fiscal sustaining meeting committee meeting. Okay. Alright. With that then, chair Smith, would you like to adjourn the meeting? Wonderful. Thank you.

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Good evening. I'll now call to order the special meeting for 01/27/2025, for the Infrastructure Natural Resources Advisory Committee.

Chair Seaborne?

Here.

Member Bardwaja is absent. Member Molina?

Here.

Member Sargent?

Here.

Member Sarvis?

Here.

Member Tuna?

Present. Great.

And so we do have a quorum. We'll now move into public comments. Public comments will be allowed on matters not appearing on the agenda but within the committee's jurisdiction. Do we have folks online with their hands up?

We do. Would you like to take those first?

Sure. Why don't we start there and then we'll move into the audience here and take theirs.

Alright. Colleen Muser, go ahead.

Good evening, everyone. Chair, happy New Year. Maureen Milton, independent advocate for the disabled, handicapped, little people, and the mobily challenged. I have a question, that went back to 10/21. Is what is a gap closure?

And there and chair Angela Tapadio talked about curb cuts that are different to the kind that we have, and I I do not understand those types of curb cuts. Do you have knowledge of them? I would love to see a picture to find out exactly what she's talking about. So, anyway, that's all I have for today. And I thank you so very much, and I hope we have a good meeting. Bye.

Thank you. Do we have any other speakers online?

No more online speakers.

More online. Alright. Any member of

the public wishing to speak can do so at this time. Just come on up to

the podium, and I think we give you three minutes to tell us everything.

Thank you. I I won't tell you everything because I don't know everything, but thank you for this opportunity. My name is John Hamo. I've been a fifty six year resident of Fullerton of my sixty one years, and I live in the Hermosa, Las Palmas neighborhood. And, being a contractor for thirty years, I see all the construction that's going on and the infrastructure replacement of our water system and sewer system, which is great.

However, I'm a little bit perplexed on the information I've been hearing that there's not enough in the budget to repave after all of that infrastructure has been replaced. And so it's interesting because I would think that would be part of the scope of work of any contractor bidding that work, part of digging it up, replacing the utilities and then backfilling and compacting and then having it resurfaced. So I'm I'm just interested to hear, if that was in the scope of work or if it wasn't and that the the streets are pretty challenging to drive on. And I'm worried that somebody I walk my dogs twice a day, throughout our whole neighborhood, and I avoid some of those streets just because of the condition of them. And I'm interested to hear that and also what the city's plans are perhaps in the in the future going forward to to repave or to to address that issue.

I really appreciate, the opportunity to speak in front of you. Thank you.

Thank you, sir. Anybody else? Come on down.

Good afternoon. Thank you for allowing me to speak. My name is Keith Switzer. I too live on Las Palmas Drive in Fullerton. I've lived on that street for twenty nine years, not quite as long as my predecessor here, but quite a while.

And I'm here today to talk also about the same subject, is the repayment of the streets in that area, in particular, Las Palmas, the street that I live on. I when I got interested in this, I looked online. I found a report that the city puts out of street maintenance plan report, I believe it's called. And I kinda glanced through it, and I don't profess to be an expert on it. But, you know, there were some comments in there about residential street reconstruction is done in conjunction with sewer and water replacement projects.

And that's exactly what we've been incurring. Also, were some maps and some evaluation of the street quality or situation. And Las Palmas was in both the 2020 and the 2024 report that I found either in very poor or poor condition. And so now the last several months, we've been incurring this pretty substantial water infrastructure project, and it's done it's wreaked havoc on the street even more. And prior to Las Palmas and being, torn up, they were tearing up the street south of Las Palmas, and then they repaved them.

We, assume that that would be the case with our street as well. But now we're hearing rumor that that's not gonna be the case, that they're just going to patch, the work that they've done. And in fact, they've done some patching, and it's it's it's still a pretty rough street to drive on. We called, and we were told various things. There wasn't money in the budget or the money was exhausted.

I was a little surprised by that. Unlike the previous speaker who's a contractor, I I I have never done that work. But I did work for electric, water utility for twenty five years. And the last twenty, I was the vice president of the regulatory function and the rate making function. So I'm pretty facile at putting together capital budgets. And I was a little surprised to hear that maybe they didn't put include repaving. I see that my time may be up. The clock went out. If if I could just

take No.

You're good. Just went out.

Oh, it just went out? Okay. Thank you. I was just, wanted to say that since the prior two reports twenty twenty, twenty twenty four evaluated our streets as in pretty poor condition, and then we've had all this fairly substantial work undertaken now. What changed? Why you wouldn't repave the whole street? One other additional point I think that would come to play on this issue is, we don't have sidewalks for the most part on our street. I don't know if you are familiar with our street. There are patches of sidewalks. Sometimes it'll be on one side of the street. Sometimes it'll be on

the other. But for the

most part, Las Palmas is sidewalk free. And so if you're a walker or if you're someone in a wheelchair, you are on the street. And those streets are pretty rough right now, and it's just not the best, the best situation to have. And so I would urge this committee or whoever's making this decision to go to Las Palmas, take a look, and maybe reconsider that, situation. That's it for me. Thank you for hearing that.

Thank you very much.

Appreciate it. I will ask, our staff to go ahead and provide a response. I'm not sure about our, the first caller, Maureen's question and what the answers are there.

So let me start with the we're we're to sidewalk. So we're just trying to close that, quote, unquote, gap of missing sidewalk. So we provide a continuous pathway. Okay. So we get into, street funding?

Sure.

Okay. So start with some some comments here. So we have different funding sources. All of them are restricted. Water funds pay for our water infrastructure.

They cannot and they're not allowed to be paid for allowed to be used to pay for other items such as storm drain sewers or street work. They can only pay to repair the streets where the trench is being dug. As far as street funding, we have more water funding than we have street funding. So we're at a stage where we have more water projects than we have available street the ability to do street projects. So currently we have four water main projects in progress where we have no currently programmed street work.

So our intention is to our preference is always to do street work with or very soon after a utility project. We were able to do that over the last few years because we had the onetime ARPA funding that allowed us to do a significant additional amount of street work that we hadn't been able to do in the previous years. But that money is now run out. And so we must deal with our typical budget. And our typical budget cannot keep up with the amount of water main work that we're doing.

As such, we have we obviously keep the list of projects that where we've completed work and where we would like to do work. And every budget cycle, we'll be analyzing and reviewing those projects, comparing it against our budgets and making recommendations that we'll discuss with INRAK and then finally go in front of counsel for approval as to which projects we recommend to be included in the year the following year's budget.

Okay. Let's talk briefly about the funding for maintenance and how we take the, very finite amount of maintenance funds that we have and we try to spread them around to raise the index so that we can continue to receive maintenance funds. Whereas if we did one time repair on a street, the cost of it versus maintenance on other streets. In other words, the fact that re re placing a street, a complete rebuild, which I think Las Palmas is a complete rebuild. There's no doubt about that.

At least the parts that I walked. I walked, the whole section of of the area last year with our then vice chair and and city staff and saw firsthand kinda some of the issues that I I think everybody's been upset about. And I I don't disagree. There's plenty of reason to be upset. How we got to this point, though, there are finite amounts of funds that we receive.

Most of it is grant money from gas tax and from well, it's all, I think, mostly gas tax. So a little bit of some special funds, some onetime funds that we get. Any onetime funds, historically, the committee has recommended, keep in mind that that is what this committee does is all we do is advise either staff about concerns that council or the public has or we advise our council members or the public about other issues. So just an advisory role. We've made several recommendations to the council over the years about how to spend these dollars.

But the fact that we get such a small amount available through the grants, I'll say this. In my opinion, speaking only as, a resident, we don't get our fair share from Sacramento, and that's just my opinion, or from OCTA. Now talk to the OCTA folks, talk to the Caltrans folks up in Sacramento. They're all gonna say, no. You get exactly what you're supposed to get.

That may be the case, but I don't think it's enough. And I don't see it being enough. So, all we can do is advise counsel that we have this one time funding, and we wanna take that one time funding and invest it very carefully into the places that need it the worse that we're not gonna be able to get money from any other source to take care of. And those are the the improvements on roads that are truly the worse. And as bad as Las Palmas is, there are worse roads in Fullerton, which is sad, very sad, but it is the reality that we're dealing with.

So we've been taking these onetime funds and trying to rebuild the roads because once we get into a maintenance cycle, we are we have a very robust and very strong maintenance program now that we didn't have twenty, thirty, maybe forty years ago. And that has changed, in large part because of public input, in large part the activities of committee members and the city staff all coming to terms with the fact that we need to maintain it. So, I think we've turned the corner on a lot of the maintenance issues, but then there's those roads like Las Palmas that are deteriorated so poorly. It's not a maintenance issue. It's a replacement issue.

And that needs to happen, without a doubt. It needs to be replaced. The question is when? And when is driven by where do we get the money? As a committee, we can't go into a deep dive on this subject because it's not on the agenda, but I do want to acknowledge that I have a stack of emails that that you've sent to or not you.

The public has sent into the city, about this issue, and I'm very well aware of it. Been aware of it for quite some time. As I said, I've walked the entire stretch and and saw some of the the concerns that people are talking about. And I gotta say in that meeting, we did speak with community members, and we did try to come up with some ideas on how to address some of the issues, like the fact that there's really no good place to walk because you're in the road. You're in the travel lanes.

There's no sidewalk, and there's really not much of a of a safe shoulder. So we talked about that and talked about some strategies on how to kinda balance those needs. And I think some of those were addressed, but, you know, it is not enough. There is a lot more that needs to be done. And I think this committee, at least the former committee, were installing new members tonight.

So if you stick around, you'll see them raise their hands and get their swearing in. But previous committees have worked really hard to try and address these issues. And it just comes down to funding and trying to figure out where the money comes from and how we can spend it best and stretch those dollars. Overlapping the next question over comes

And

then I'll 's really not a source of revenue for the road fund. So short of getting grant money from the state or the county or federal or city council making a decision to fund more, which, you know, that's a a discussion for the council. We always ask for more money. Believe me. We always ask for more money. They just happen to say no most of the time. But short of that, I'm not sure how we we can address our road deficiency, quality of the roads. We've been really good about moving it forward, but it's not fast enough and the deterioration is outpacing the maintenance and replacement. So it's a sad reality. It's something we need to overcome.

And I appreciate the input from the public. I hope you stay engaged with this committee and, you know, take a look at the things that we're talking about. Give us your, give us your opinions. Give us your thoughts on it. I'd appreciate it. And I think the other committee members appreciate the dialogue and the perspective. All right. I'm gonna stop there. At this time, if there's no other hands up and no other members of the public, we'll close public comments and move to oaths of office. And I think there's a whole bunch of us that are taking oaths.

Only the two new ones. Oh.

So old oaths still carry?

They can't I mean, if you really wanna say it again, go ahead and stand up with them and raise your right hand or say the long whisper. And for our new folks, welcome mister Sarvis and mister Sargent. So if you could raise your right hand. The rest of you are welcome to join along in solidarity, but you don't have to and take the oath of office. So if you would please repeat after me. I state your name. Do solemnly swear that I will support and defend

That I will support and defend

the constitution of The United States

The constitution of The United States.

And the constitution of the state of California

And the constitution of the state of California.

Against all enemies, foreign and domestic.

Against all enemies, foreign domestic.

I will bear true faith and allegiance

I will bear bear true faith and allegiance

to the constitution of The United States

the constitution of The United States

and the constitution of the state of California

the constitution of the state California.

That I take this obligation freely

that I take this obligation freely

without any mental reservation or purpose of evasion

purpose evasion

and that I will well and faithfully Discharge duties.

Discharge duties.

Upon which I'm about to enter.

Which I'm about May to

this be the hardest thing you do tonight. So I'm gonna have you sign me.

These are official forms now. Congratulations.

If I could indulge a chair and make two Let's do. Quick PSAs. And sorry staff, I haven't warned you about this either. It's not a big deal. Don't panic. But we are moving to a new Zoom platform in the city. So in the next month or so, you're going to have all new Zoom ID numbers. So I know we have some folks online that are going to want to know that. So keep an eye on the agendas moving forward as those numbers will be moving, changing as we move to the other platform. The other thing is, I know you may have heard that city council has been making some adjustments to the, committee membership.

NRAC is now going to be, let's see if can do this from memory, five direct and two at large members instead of four at large members. That will not take effect for a while because it was embedded in an ordinance. So council did their first reading, they'll do their second reading at the next meeting, then it'll take effect thirty days after that. So sometime in March, we'll rejigger your membership.

It should be pretty simple because you have

a lot of vacancies in your at larges anyway. So we'll probably just exclude two of the vacant seats and then get counsel to make appointments to whatever is still on there and still vacant. So thank you for, for the PSA, sir.

Thank you very much.

Thank you very much.

And for those members of the public that didn't know, Lucinda is our city clerk and she is the go to when you have questions about city governance and not sure where to go. She's really good at telling you in a very nice way.

I just say, I don't know. Go talk to that person. But, yes, I know where to I know where to send you.

Thank you. Alright. Congratulations to our new members. We will now move to the consent calendar. We have one item, the minutes from 10/21/2024. And I think we would entertain a motion and a second. And all a member needs to do is say I move to and somebody else say, I'll second that.

I would like to move to approve the minutes. I second.

There we go. Alright. Madam clerk, please take the rule.

When I state your name, just say yes or no. Chair Seaborne?

Aye.

Member Bard Waja?

Yes.

Member Molina?

Present.

Oh, this is yes or

no? Yes.

Yes. Say your name. Sorry.

Member Sargent?

Yes.

Member Sarves?

Yes.

Member Tuna?

Aye.

Thank you.

Alright. Alright. We'll get into regular business. And the first item of regular business is new committee member introduction. So right before we do that, I do wanna make sure that I'd like to just kinda express and I said it a little bit earlier, but I I wanna do it again.

Can I express the mission of INRAC and why everybody is here and, you know, what we do and why we do it other than the fact that we just, you know, have nothing better to do on a Monday night, I suppose? So sort of our mission without it being directly a mission is to advise the city council on infrastructure, provide input on policies, plans, and broad programs as they relate to energy, natural resources, compliance with environmental laws, and the protection of the environment, act as a hearing body regarding any and all utility billing disputes, and make recommendations on the establishment of underground utility districts and such other related matters. So at the heart of that is the word advise. What we do is advise. We advise, again, council.

We advise city staff. We advise members of the public, and we act as a conduit for all of those. And the role we play is important. It it helps council and it helps staff and the public understand what is going on and why. And a big part of it is being able to to to take the goals that the council has and how do we put that into practice or even reverse that, the needs of the city, which has historically been we need more improvements in our infrastructure.

So how does that happen? Well, we talk to staff about it. We talk to the public about it. We talk to council about it. We make advisory rulings. We we make motions and and seconds, and then we approve them. And in those motions are directions of advice to council. So we don't really have a say in the decisions that council makes or even in city staff. We don't we don't direct city staff to do anything. We ask them.

We advise them, and we take that back and forth in communication. So, for new members that may not be familiar with how NRAAC works, I just wanna kinda give an overview of some of the the things that happened and and kinda why we're here to here to meet about this. So with that, why don't I start? Do you wanna go alphabetic, Chris, here? Do you have any preference?

I was I was planning on doing the stuff in

David, you get it? Okay.

Go for it. Give you an idea of what we

Thank you.

Gonna do. So and then then we'll go to the committee members. And the new committee members can be, you know, the last ones to introduce themselves. All right. So I my name is David Grantham. I am the city engineer. I had my one year anniversary last week. Yes. So but I've been with I've been with the city for about eight and a half years now. I'm also a long time Fullerton resident.

I went to Troy. So a very unique situation where I live and work for the city, and it's, it's very passionate for me to to work here because you you get to live it every day even on the weekends. So, I drive those streets every day and on the weekends as well. I will introduce, my boss, Steven Weiss, the public works director.

Hi. Good evening, everyone. So Steven Weiser, director of public works, licensed civil and traffic engineer in the state. I'm also a Fullerton resident. Was I didn't go to high school here, but I moved here about twelve years ago. I raising my family, so my kids go to school here, play youth sports here. So I also drive the streets, but I also see all the facilities that, you know, also have some infrastructure needs as well. I have been with the city three years now, one year in the current role, and I'm looking forward to working with you all.

Mister Zavala.

Good evening, everybody. My name is Juan Zavala, principal civil engineer. I've been with the city a little bit over eight years. Started around the same time around David. I'm not a City Of Fullerton resident, but I do live nearby just outside of it. So I do drive those local streets to work. I am a licensed PE as well, and I am getting more and more familiar with NREC. So you'll be seeing me more more and more.

And I'd like to introduce Christy Holt who has been with the city longer than me, which is and quite frankly, we can do anything without her. Everyone in public works just nothing but fantastic things to say about Christy. And you'll you'll realize that when you get the emails from her. She is fantastic. We can't do anything without her. And I know she wouldn't say anything about herself, so I do it for her.

So Christy's role is to act as our parliamentarian and kinda keep things in order. This is for the for the new members. And when we start to stray, she'll she'll say, hey. Back in your lane. You you're that's not on the agenda. Let's, you know, keep it keep it keep it on the on the agenda. And so but she's also a public works staff. And what do you do within public works? Are you an engineer?

No. I'm I'm the administrative assistant, so I primarily work at the maintenance yard. I do customer service for all the service requests that come in and then administrative support to, a management level.

So when somebody has a pothole, you're the one that takes the call?

Depending on our staffing levels, yes. But often, yes, that is.

Okay. Alright. Thank you.

Question, Mr. Chairman. Does Christie also do the counter? Do you have a counter here at Public Works where people go in personally?

At the maintenance yard, we do have a counter, yes. So not here in engineering. I do not work over here. I work at the maintenance yard. But, yes, we have a counter, and so people can come in that way

too. Yeah.

Thank you. I will hand it over to committee to introduce themselves.

Thank you. I'm going to start over on my right. Manish? Hi,

Manish Bharat Bhaja. This is my second go around on INRAK. I've got to tell you, attend a lot of council meetings, watch a lot of commission and committee meetings. INRAC by far for me is, I believe, not only a phenomenal committee but also run very well, not just because of our Chair and Vice Chair, but because of our staff, starting with Christy, David, Steven, Mrs. Valla, all of you guys have been amazing.

I think that's important to remember because we are here to advise. I think, unfortunately, some committees have gotten out of, you know, that parameters. I'm not putting down anybody, but I like how this committee has stayed on point and knows their role and hopefully doesn't cause too much extra work for staff. So with that, I wanted to say welcome to our new members. And also, as always, thank you to our staff. You guys and ladies are amazing for us. Thank you.

Thank you. Member Sarvas?

Good evening, everybody. Greg Sarvas. I am an electrical engineer, graduate from Cal State Fullerton, also a licensed professional engineer in the State of California. I work for another municipal utility. I live here in Fullerton but don't work here. Very glad to be welcomed to this committee. I have also watched some from the outside and this is an honor to join such a well run committee on such more important things. If you can't tell, I enjoy talking about infrastructure a lot more than talking about myself. So looking forward to being here and working with everybody, and thank you to all of the staff that I've met so far and have made this such an easy transition.

Thank you. Member Tuna.

Hi there. My name is Kari Tuna. I'm a thirty six year resident of Fullerton and graduate of Troy in Cal State Fullerton. I'm an accountant for a local manufacturing company in Anaheim, and this is my first term here on INREC. And so far, I've really enjoyed working with the staff and the committee, diving into all these issues and seeing how we can help, you know, this move forward because I really care about this town, and there's a lot of things we gotta fix. But I we have some astounding people to work with here, so it's been great so far. And I'm looking forward to the next two years.

Thank you. We'll move right along. Member Molina.

Good evening to everybody. I am Butch Molina, and I'm a twenty five year resident of the city of Fullerton. And, my main motivation of joining the INRA committee is because the city has been very good to me, to my family, and then I really, really think it's time to get back no matter how small it is. The INRA committee is well run just like what said by by my previous colleagues, by by the not only by the chair, but also by the staff. And the interact is some something that is really very close to my heart being also a civil engineer.

Although I'm a resident of the full of the city of Fullerton, I work at the city of Upland. I'm with the land development transportation. So and to the new new members, congratulations and welcome.

So wait a minute. You mean an Upland, your staff?

What's that?

When you're an Upland, you are the staff?

You I am the staff.

Oh, okay.

I'm on the other side.

So you get to be on the other side. Wonderful. Alright. Member Sergeant.

Good evening. My name is Charles Sergeant, and I've been a resident in Fullerton since 1966. My family moved up on Highland Avenue above the courthouse when I was a little kid. Worked for the Daily News Tribune as a child. Did the master route on Harbor Boulevard to all the businesses. My background, I'll go real quick because there's too much to tell because I had too many jobs as a kid. I started out in public works back in the seventies. Worked for the county as an auditor but have a heavy background with public works and sewers underground has been mainly my career as a pipe fitter starting out all the way working through the county of Orange Works. So I feel really good with this committee. I feel like I'm well versed.

I don't have an engineering degree but I have a DIRTT degree because I've been in the DIRTT for forty seven years so I feel comfortable with everybody sitting at this counter that I think we can all see eye to eye on most of everything. So I'm looking forward to working with the committee and being sensible and helping as much as I can with the public when they come in here with concerns. And I did run for city council last year and I have twice. So this is an honor for me to serve in any perspective now and I thank the my being appointed, I thank the city councilman who appointed me and I look forward to working with you guys. Thank you.

Wonderful. Thank you. For those who don't know, I'm Greg Seaborne. I'm resident of Fullerton for about fifty years. Born and raised. Go Indians. And go Hornets. I'm a my professional side, I'm a registered or professional land surveyor and, been working in infrastructure and land surveying for about twenty five years. And, god, time flies when you're having fun. Yeah. I'll stop there. Alright. Alright. Now that introductions are done, we are gonna go to some serious business now, folks. We're gonna go to item number three, and we will be selecting committee chair and vice chair.

And I think we turn this over to Christie to manage. Correct? Or David?

David, do you wanna do?

Yes. I'll do. Okay. So every beginning of every calendar year, we need to select a chair and a vice chair from our committee members. There are some rules, but they're very, very minor.

You don't need a second if you want to nominate somebody. Whoever was chair before can be chair again. This year, we do not have our long term vice chair returning to us, so we will need a new vice chair. And since we do have, we're missing probably one member, if you guys would like to continue this for a future meeting, that is also an option. Whether that but if we do do that, Greg, you will need to continue as chair. So at this point, we will take any nominations for Chair.

Okay. Nominations are open.

I'd like to nominate Greg Seaborne for Chair.

I second I'd the

like to nominate Greg Seaborne for Chair.

Thank you.

Any others? Okay.

Closed nominations?

Close we'll close them.

Is it by unanimous consent? Since there's only one, if we want, we could now do vice chair nominations, then and we can vote on them both at the same time.

Alright. Are

we open

for that now?

Open for vice chair.

I would like to nominate Carrie soon for vice chair.

You can.

You can.

I'd like to nominate Munis instead.

If you can say my last name, I'll accept the nomination.

Bart Bart Laja. So

we have two nominations. Any others? And do would each of the nominees, accept their nominations, or does one of them not accept their nomination so we know who we're voting for?

I'm up for it.

You wanna do it?

I would, see to, give it to Carey because I'd I'd I'd like to see him be vice chair.

Okay. So are you withdrawing your nomination for, mister Bardwaja?

I'll withdraw that nomination.

Okay. It's only because he couldn't say my last name.

I just

wanna put that on record. Bart Blanjas. Alright.

So if I could get someone to make a motion, for chair Seaborne and vice chair, Tuna, then we can just vote on that. I need a motion and a second for that.

I move to accept Greg Seeborn as chair and myself as vice chair.

I'll second it. Seeborn Tuna.

Okay. So that's what we're voting on. Chair Seeborn.

Aye.

Member Bart Waja.

Yes.

Member Molina? Yes. Member Sargent?

Yes.

Member Sarves?

Yes.

Member Tuna?

Aye. Alright. Congratulations, vice chair. All right. We'll now move on to Item four, select Water Bill Dispute Panel members and Chair and Vice Chair. And David, if you could give a little background and Yeah. Color on

So

one of the subcommittees, if you like to put it that way, of INRAAC is the water bill dispute. And what that means is that there are times during the year that people are questioning their water bill. There are stages of addressing their questions and their concerns. Typically, it goes through staff, through our Utility Services division. If we can't get to a resolution, the final stage is coming before the water bill dispute panel.

The water bill dispute panel is the authority to make the final decision on the dispute or the questions being brought to brought by the resident or the property owner. We do need a minimum of three NRAG members needed for every bill dispute panel. Obviously, we can take more who would like to be on the panel, to give us some buffer and some flexibility for when meetings come up to make sure we have enough people to hear, the dispute or the questions. I put on the screen who was members last year, but obviously, we'll take nominations. Or if you would like to volunteer, which would be better, if you'd to volunteer your time, that would be great.

Last year, three or four three or four times the the the subcommittee met. I believe they take an hour

ish. Sometimes. Yeah.

But it it is something I think is, very helpful for the residents to come before other residents, to hear what's going on and instead of staff, giving giving the final, decision.

It is one place I think we can be very impactful as, you know, participating in in this public process. And for that reason, I've enjoyed being on the on the panel. But it it can also be frustrating hearing all these stories and and the different things that have come up. So alright. So first, why don't we see who wants to serve on it, and then we'll see go with the chair and vice chair. Member Bardwaj's hands up, you want to serve on it? All right. You're on it. Mister chairman Oh, mister sergeant, you want to be on it?

Yes, sir. You're on it.

Mister chairman, I just have a question.

You wanna be on it? No.

Oh, okay.

Save your question. No. Go ahead.

Do we have to limit the members for this subcommittee to NRAC members only?

Yes. Yes.

Okay.

Yeah. This is a subcommittee of NRAC, so it has to be us. Tuna? Okay. Vice chair Tuna as well. Okay. Mister Sarvas, member Sarvas, do you wanna do it? Or are you

I also have a question before I

answer it.

David, I noticed you've got the Wednesday at 05:30 listed here. Is that a regular cadence for this meeting?

No. This just happens to be a meeting that was prescheduled probably last year. And it's a little awkward because, obviously, we got new members beginning of the year. But we always try to these meetings could be anytime during the year, but we always try to find a convenient time for everybody. So there's no set time other than typically we try to do it in the evening or early evening where most people have the ability to attend.

Very good. I'd be happy to serve on this important Board.

Wonderful. Thank you. And, of course, I am happy to continue as well. So that's, one, two, three, four, five. We actually got a full committee. That's great. All right. I think the next step here do you want to take a vote on that first?

Actually, Greg, just a question.

Sure.

Does the water dispute panel have to be less than like an interact quorum? Or the because I know that things are changing. Or should it be three less because of the new structure?

Yes, it's a good question.

I would honestly think that three is the bare minimum because you want an odd, obviously, an odd number to make a decision. And if you go to an odd number less, it's gonna be one, which I don't think is necessarily there.

Correct.

So there you go.

Thank you.

Alright. Christie, do you want us to vote on

Just do one vote for everything.

One for everything? Fantastic.

I like that. Alright. We'll now open up

nominations for chair. Is anybody, excited to serve as chair? I see a hand go up down there. So mister member Bardwaja, I can say your last name. Maybe not right, but I can say it.

You said it pretty you said it pretty well. Okay. If, Mr. Genoa would like to nominate, suggesting it, but

I'll nominate mister member Bartwaja.

I can kinda

say that.

That's pretty good. Alright.

Any other nominations for chair of the, water bill dispute? No? Okay. We'll close nominations, and I think that's by acclamation for now. Now vice chair. Any member wish to serve as vice chair? Yeah. Member sergeant. Okay. Anyone else? No hands are going up. Fantastic. Let's take a vote on, who is gonna serve on the water bill dispute committee and, the chair and the vice chair selection.

So can I get, someone to make that motion and then a second?

I will move to have member Bardwaja, member Sarves, member Tuna, myself, and member Sargent as the water bill dispute, members, and member Bardwaja as chair and member Sargent as vice chair.

I second.

Great. Chair Seaborne?

Aye.

Member Borg Waja?

Yes.

Member Molina? Yes. Member Sergeant?

Yes.

Member Sarves?

Yes.

Member Tuna?

Aye.

And I just wanna remind the five of you that there is a meeting on the twenty ninth at 05:30 in this room.

So make sure it's on your calendar. We need we need to make sure we, keep up on those. Okay. Fantastic. We'll now move on to item five, committee meeting dates.

This one's pretty simple. I just like to put this out at the beginning of every year. We have meetings once a month. The third meeting of each third Monday of each month is our regularly scheduled meeting time from five to seven right here in the council chambers. These are the dates for our regularly scheduled.

Obviously, January 20 is not happening because we're here now on the twenty seventh. But next February 17, that is President's Day. So we typically move that to the twenty fourth. Every other date seems to be fine, not conflicting with any holidays, except we do talk about December 15. When we get to that, we'll decide the committee will decide whether there's a need to hand that that meeting because it's so close to Christmas holidays.

Okay.

That being, this is a

Christie will Yes. Email prior to those meetings if there's change in through the holidays, we'll get an email seventy two hours prior. Is that what it is?

Yes.

Okay.