Planning Commission - Regular Meeting

Heather, can you hear me? Heather, can you hear me? Heather, can you hear me? Yeah.

Hello. Hello. We're doing a mic check so you can hear. Got to be quiet though. We want to make sure you can all hear. Okay. Heather, can you test your mic for me so we can hear you? Yes. Thank you. We're going to test all of the other mics now, too. So, if you guys could just be quiet for a little bit, that would be so great. Thank you so much.

And I actually went to check. I'm just ming here. Test test test.

Mic check. This is number eight. And um Bridget, council member McCandless is number nine. This one is number eight. Mic check seven. Mic check seven.

This is the mayor's mic number seven. Mic check six. Mic check six. This is council member Fear's mic. plenty to say.

Mic check. Mic five. This is council member Perkins. Mike. Mic check four. Mic check four. This is Council Member Stewart's mic. Mic check one. This is the podium mic. Mic check one. Mic check two. This is mic check two. Okay. Mic check three. Mic check three. This is the new city manager's mic. Mic check.

There's Maline on the front row with Bill and Cher. Is he children? There's no I'm your sister. I'll never forget childhood memories.

Good evening. Hello. Hello. Hello.

Good evening. Thank you. Welcome to the city council study session on April the 13th, 2026, 6 p.m. at 20201 East Jackson Drive, the first floor of the Oregon and Santa Fe conference room, Independence, Missouri 6457. This is truly an auspicious evening because it is actually the first evening or the first day that our new city manager is here, Troy Anderson. So, could we give Troy a round of applause for his first day? And this is also an important moment because this is the moment uh we decided as a group that we would actually swear him in this evening. So we're going to actually have if you would Troy come forward. Suzanne, our city clerk, is going to swear him in and uh we'll we'll do that. And so uh and if anyone else wants to take pictures, we certainly can. Kim, if you could help, if you got your camera ready, I would be extremely grateful.

I, Troy Anderson, I, Troy Anderson, do solemnly swear do solemnly swear that I will support the Constitution of the United States that I will support the Constitution of the United States and the State of Missouri and the State of Missouri and faithfully discharge the duties of the Office of City Manager at the City of Independence. faithfully discharge the duties of the office of the city manager and of the city of independence in the county of Jackson in the county of Jackson and the state of Missouri and the state of Missouri to the best of my judgment and ability to the best of my judgment and ability congratulations and welcome

welcome Troy and we are thrilled to have you here thank you and I hope it's been a great day of education and you learned a lot about the city and and I know Lisa and the staff are going to help you through the whole process. So, piece of cake. Piece of cake. So, very very good. Okay. So, the first item on the agenda is a council item 267 718. Council member McCandless, that is your item and I'm going to defer the item to you if I may, please.

Thank you very much, Mr. Mayor. Uh so this item you may be aware that independence uh exists in the unique position of being in a county with three separate health departments and because of that sometimes we have conflicting rules between Jackson County, Kansas City and Independence Health Department. Um, in order for independence to continue to be small businessfriendly, looking at ways that we can streamline and address uh some of that administrative complexity was the intention of this resolution. Um, hoping to have consistent rules between Independence and Jackson County. Um however the uh council has instructed the um department of health to do a review to see where it is that we have overlap and coordination capabilities with the county. And so because of that reason, I'm going to recommend that we postpone this indefinitely, allowing the new council to get that information back from that review and make a decision whether having consistency of those sorts of rules will be in the best interest of the citizens of independence. So my recommendation is at the next council meeting that we plan to postpone that indefinitely. Mr. Mayor, thank you.

Thank you very much. Thank you very much. However, according to our rules of procedure, the item was in fact posted and since this is a council item and the rules of our body state that someone can in fact, you know, the the people who wanted to speak on it can speak on it, but they can certainly defer now because this thing will be deferred indefinitely. Uh, so I'm just I'm gonna ask the group if of these three people if they still want to speak and if they don't then we'll just proceed. But uh is Kelly Jabs in the room? Is Stephanie Robinson in the room? Is Scott Quails in the room? Yes, I would like to. Me too.

You would like and and your name is please Kelly Jabs. Okay. Kelly, thank you very much. And then is Stephanie in here? Yep. And Stephanie, I still want You still want to speak? Okay. Thank you. And is Scott in the room? And are you still willing to speak? Okay. Thank you. So, uh I do need a motion. We have a non-resident from Independence who has requested to speak. Can I have a motion to change uh to allow a non-resident to speak this evening? Mr. Mayor, please. I'd be happy to make that motion uh to suspend the rules and procedures for non-residents to speak for. Thank you. We have a motion to suspend the rules for non-residents to speak this evening. Do I have a second? Second.

Thank you very much. Madam City Clerk, can you please call the role? Council member Fierce, yes. Council member Perkins, yes. Council member Stewart, yes. Council member McCandless, yes. Council member Wy, Council Member Vaude, yes. Mayor Roland, yes. And the motion carries. And we'll go in the order that people signed up. Scott Quails, you can come forward. Please state your name and address and you'll speak uh exclusively and only on the item that was posted on the agenda. And you'll have five minutes, please. Uh my name is Scott Qualls.

Is the Thank you, Scott. My name is Scotts. Uh live at 259 Glen Lane, Independence. Um, I'm speaking against uh tying independent health regulations to Jackson County. I don't believe that uh the city should give up our responsibility and our authority of setting our own health regulations. Um, and uh we can always look at what Jackson County is doing and mirror that ourselves uh and make the changes that we need to do. I don't think it's something that we need to uh make permanent. So that's all.

Very good. Thank you very much. And I appreciate you def uh yielding the rest of your time. Stephanie Sing Stephanie Robinson, if you can come forward, please. And then Kelly, if you can come forward also, so we're ready to go. That'd be great. Well, Stephanie, please come forward, state your name, and you have five minutes. Stephanie Robinson, third district. Good evening, uh, mayor, council people. Thank you.

Um, well, you really cut down on what I wanted to say, so that's good. But, um, I guess my concern is that if we take on the regulations, are we then giving up our administrative rights to the fees and all that stuff? So, the money is kind of where I'm always at. But um also I I agree that we should not be giving up our city should not be giving up the rights that we have to the county. Um we are better equipped to identify and deal with problems at the city level because I believe there's 18 other cities that the county has to take care of with the health. So we should take that burden off of them and keep managing our own. And from what I read that we stand to lose half a million dollars in if we lose the fees if we basically abolish our health department or are we just going to be taking on the regulations? That's kind of where I'm confused. But I know some of that money goes into the general fund. And so I'm worried if that would affect the money at all with the with the regulations. So, I guess that's my biggest thing is that we we know how to manage our city. We've proven that our health department's effective and our local businesses should have the rights to impose or not impose county regulations or mandates or suggestions. Um, I think that's something that we're all be capable of doing here in the city. So, I guess that was my biggest thing. if maybe we can go over that ever again if it comes up. Does that make us lose our revenues with the licensing fees and permits and all that?

Thank you very much. And Kelly Jabs, you'll have five minutes and please state your name and address, please.

I'm Kelly Jabs and thank you for the resolution to hear non-residents. Um I was going to speak to um postponing this as well. I appreciate you offering that for study. I think that's smart and that was where I was at as well. Um I wanted to specifically highlight that I believe independence is in a unique position to um govern themselves and that's one of the beautiful parts of our city. Um the health department if we do were to abolish and align with Jackson County we are um so we stand in a position to consolidate power that we may not necessarily agree with as a city and residents. Um I think that holding on to the power we have is important. Strengthening it and streamlining it along with the county would be an asset and I'm would love to see us keep that. That's all that I had. Thank you.

Thank you very much. Okay. Uh Mr. City Manager, the next item up is risk management update. And how would you like to frame this one on your first topic at your first study session? Honorable mayor, thank you so much. Um there's going to be a lot to unpack here. I'm not going to do that. I'm gonna call on Melissa Cabrera to come up and talk through that. Thank you very much.

Good evening, mayor, members of the council. Um, tonight I have prepared this presentation on risk management. Um, I will be tag teaming with a few team members. Here we have James Charlesworth um, who is with Charlesworth Consulting. he is engaged as the city's uh risk management manager as well as Nicole Thompson who is fairly new uh to the city and is the safety and compliance program administrator. So I have uh framed this in a way that looks at the finances uh the way that our claims and our liabilities are affecting our finances, fund balances and some of the mitigation efforts that we can do to correct um you know the the negative fund balances for both risk management and work comp. Um, we could obviously be here all night discussing this topic, um, but felt it was better to maybe break it off into a few bite-size uh, presentations so that we can discuss it and we can figure out appropriate forums going forward for decision-m and how we want to handle that.

Give me just a second here. There we go.

So, tonight we're going to be talking about the financial overview, our claims, experience and cost drivers, root causes, financial outlook and risk exposure and then a path to stabilization and sustainability. So we have two funds uh they are both consider cons considered internal service funds um which do charges out to um each of the departments to recover the costs that are recorded here in the fund. Um the first one is the risk management fund and so the purpose of this is to fund liability and property risk. you will have all of our insurance payments for general liability, auto liability, property, law enforcement, excess, and umbrella insurance. Um, and the purpose of the fund is because we are largely self-insured up to an SIR or self-insured retention of a million dollars. Um, we need to stabilize the cost across departments. Otherwise, if departments were paying for their legal services, insurance um on a occurrence basis, it would cause some pretty wild fluctuations within their budget um affecting operations. Um and so this fund supports our self- insurance strategy. Uh the revenue sources here are department allocations and investment earnings. So you can see when we moved to a uh self-insured uh status uh starting in 2019 that originally the way that we were funding it, we started to see an increase in the fund balance. However, beginning in 2023, we started to receive some pretty substantial um liability occurrences that then started driving down that fund balance. Um, just for reference on this, um, at the

end of our last fiscal year, so June 30, 2025, we were sitting at a about a $4.4 million deficit in the risk management fund. Um, that right now is currently sitting a little bit higher as of our February financials at about 4.8 million. The other fund that goes along this is our workers compensation fund. So, it covers employee and work-related injuries and illnesses. Um, it pays for things like medical treatment. It can pay for lost wages, disability benefits, um, legal claims and administration, um, and our excess insurance. Um, the purpose of this is um, again to pay medical and wage replacement costs and, uh, revenue sources, our department allocations as well as investment earnings. You can see here as well that it is on that downward trajectory based off of uh claims that we've had filed here in the past few years. Um and um I thought this was pretty telling there of of this chart, but at year end uh 2024 it had about a negative $ 8.6 million uh fund balance and that increased at um year end uh June 30th, 2025 up to about 15.6. six. So, nearly doubled um based off of some of the claims that were coming in. Uh one of the ways that we fund this fund here um is we meet with Charlessworth. The finance staff meets with Charlesworth in February to start budget projections. um Charlesworth and he'll give you just a little bit um more information about this but consulting um estimates our next year expenditures for premiums and outstanding liabilities and that's factored into those departmental allocations that goes out to each

department. Uh cost allocation is determined using claims trend and then budget staff enter cost allocations into the departmental budget. And just to get a little bit more into this on this next slide, he will talk about what each of these categories is. Good evening, mayor, members of the council. James Charlesworth, Charlesworth Consulting. So, when we work to prepare a budget, we really are focused on maintaining a budget that is adequate to fund outstanding liabilities during the next fiscal year. It's really not designed to grow the fund balance. And I like to point that out. first off because that's going to be the next topic of conversation. So when we look at our insurance premiums, our third party administrator, our services, safety, cyber insurance, crime, bonds, drone, etc., etc. We have some terminal liability from older policies. And then we have what we considered our retention fund balance. And you'll look at that 90% confidence. And and how that's decided is we trend losses and then we look at that as a comparison to the paid amounts versus the uh loss ratio. And so it creates a loss ratio and that was where the 2.9 million. So we feel like 2.9 million will be the actual dollars spent over the next fiscal year for claims that occurred not only next year but all the years prior. That is for liability for property. It's a little simpler. We have utility property, city property, physical damage, engineering fees, and broker fees at a little over $2 million. Uh, one thing that's not in uh considered here, which hasn't in the past, but we need to consider it in future, is our deductibles. Uh, property deductibles

continue to go up, primarily wind and hail uh because of activity in this part of the country. Uh we've been fortunate not to have major property losses, but if that does happen, uh we will need funds for those deductibles. Getting into the workers compensation piece, we have our excess insurance, um that's our stop loss, if you will. We have various fees, uh third party administrator, second injury funds, legal counsel, nurse case management, and then our losses. Again, this is a little bit different. We take we took a three-year paid amount and we trended that uh and we feel pretty confident that that 3.7 million will cover claims cost uh for claims that are paid during the next fiscal year. So all in all, we're looking at 11.45 million uh for the risk management fund uh for the next 2627 fiscal year. So we look at our claims trends. Uh the things that are important is what's our frequency. In the insurance world, frequency is more important than severity because if you have enough frequency, um serious claims will happen. Are claims becoming more expensive? And how long are they taking to resolve? Everything is a yes on one, two, and three. Um we're having a little bit more, but the trend is is improving, which we're happy about. And then next steps are to identify, predict, measure and control. Uh sounds easy but that's that is something that is our responsibility going forward. So we look at claim frequency. We have to look at how often they happen, what day of the week they happen, are they on the weekends, are they in the morning, are they at night? uh all those things are going into consideration on all claims so we can

try to find trends. Uh severity severity keeps going up primarily because of nuclear settlements throughout the country against municipalities. Um and with a large retention uh we've got some work to do internally to try to improve processes to where we're in a better position to litigate claims going forward. uh work comp duration. We need to work on ways of getting our employees healthy and back to work. Uh and then we have to recognize the high-risisk operations of the city because that's what they do. Claims are going to happen. Uh we recognize that, but we have to work with them to find policies and procedures to help them be safe and go home to their families. And of course, workforce size. Uh like all municipalities, we could use a lot more people, but we just don't have the funds. And so a lot of employees are working extra hard uh just to maintain their their daily workflow. So if you look at our loss history, I think an important note is these are incurred losses. Incurred losses are paid mounts and reserves for future payment. Uh example in 2023 we had $5.28 million of losses, but in that calendar year we paid 1.6 million. Uh same for 2024 we had 3.47 47 million in losses, but we only paid 1.95. Uh, and then in 2025, our loss numbers are better at 1.3, but we paid 2.8 million in losses. So, what that tells us is that there's a lag between when a claim happens and when it's ultimately paid. And so, even though our incurred losses, which are recorded based on the policy year, are going down, uh, we anticipate an increase in payments going forward. So, our liability trends on auto uh higher than we would like uh but

it it's common and we are fairly flat there. It is going up a little bit. Uh but we're happy with that. We just need to reduce the numbers uh not only for third party liability and injuries but also physical damage because vehicles are just getting more and more expensive to repair. Employment EPLI is employment practices liability. Uh we've had some challenges in that area. uh we have stabilized but it is a concerning trend going forward. That's where uh we will lean on human resources on policies and procedures going forward. LEAL is law enforcement liability. Luckily we are seeing a downward trend in activity incurred claims and number of claims. Um, but law enforcement is one of those types of claims where frequency is important, but it is such a significant risk of a catastrophic loss. We can go years with nothing and then a split-second decision uh by an officer or a citizen or both uh can lead to a significant claim. Um, and that's just the nature of the the job. And then our general liability, this is bodily injury, property damage from our premises and operations. Again, we are fairly consistent on our claim count uh with a slight downward trend, which we're excited about. Uh but it's the cost that is um is really what's what's current concerning ush going forward. So, those are all items that we're really focused on uh to improve. And I'm going to turn it over for some more comp information.

All right, Mr. Mayor, city council. Um I'm Nicole Thompson. I am the safety um and if you can speak a little bit closer. Okay. I am happy to speak much louder. Thank you.

All right. Um I am Nicole Thompson, safety and compliance program administrator. Um I did start uh late January of this year, so fairly new to the position here at City of Independence. Um but I have had an opportunity to dive into your losses on the workers compensation side a little bit. So, I wanted to give you a little bit of an overview of what we were looking at um on the workers compensation side. So, this is a trend chart that shows the um number of claims versus their um costs over time. I'm going to dig into this a little bit further. You could see in the beginning um earlier 90s where we probably don't have solid data, but um kind of the last 20 years of data are kind of the trend to look at. This is um the main core of what we're seeing in workers compensation is the notable trend is that rising cost per claim. Um so it indicates an increase in the severity of incidents that we're seeing for workers compensation. So increasing medical costs, increasing time for um employees to return to work. Um those are kinds of things, you know, um potential for, you know, those more significant and serious incidents. So, I have um trended this a couple of ways. Um you know, one is just that general trend line on the rising cost per claim and then um a three-year trend line just because the way in workers compensation that we generally look at those numbers is over a three-year average to kind of ease out those differences year-over-year where you have those fluctuations in claims.

Mr. Mayor, please proceed. Nicole, can you describe what are some of the claims you're seeing without going into detail obviously, but what are some of those bigger things? And I would even go further probably maybe taking in our uh FD and PD out of there and kind of bring in the rest of our team and some of the stuff that they are having issues with. Sure. And I could say, you know, like the the pre, you know, um FDP, power and light, all of it. A lot of what we do see is strains and sprains. Yeah. So, um as a safety, you repeat that. I didn't hear you. I'm sorry. Strains and sprains.

Okay. Thank you. So um lifting incidents um you know patient transport and handling um you know from a safety and health perspective it's a lot of ergonomics issues um and also just out in the field like say municipal services is kind of like um twists of the ankle and that sort of thing. So a lot of that type of injury is kind of the top line. Okay. Yeah.

Thank you. All right. Um this is um for the insurance industry um the experience modification rate for the city. Um to explain it a little bit an experience modification rate is uh calculated by the insurance um our broker gives us this number. Um and an EMR of one indicates that you have industry standard risk. And so this would be comparing us to other like industries, other municipalities, municipal services. Um, and a one is industry standard where we had our EMR in 2023 as a 1.12. Um, and in 2025 the 1.51 um we are seeing that increase over time with the most recent calculation um for 2026 being a 2.02 O2 which indicates um twice the industry um standard risk for the city of independence.

Mr. Mayor, please proceed.

Are we seeing other municipalities seeing an increase in either the frequency or the cost of their payouts? I'm just asking if the baseline is shifting along with us. Well, the thing on the experience modification rate is, you know, that changes by time based on, you know, all of the industry data. Um so I will say from a recent dive you know if we're looking at our top three and some benchmarks that we've had um for say um PD fire and power and light is that they are seeing that same kind of increase in like cost per claim but this is showing that we are having more claims than they have. That's that frequency. And

as someone who um sorry works for a number of municipalities, I will say this is the highest modification factor that I have. Um and I'm not going to sugarcoat it. It's bad. It's it's it's not good. Typically, we like to see something under one. We like to say that we're better than benchmark. Um, for example, if we were to go out to the fully insured market and purchase insurance, they would charge double the premium um than than anybody else. So, I would say, you know, the 1.12 to 1.2 would be a realistic goal to get to. It's based off a three-year rolling average discounting the most recent year that hasn't matured yet. So, for 26, we're looking at 24th 22. So, this is going to be a slow churn to to try to drive it down, but it is above the norm.

And I will say too that this number can affect your ability to purchase insurance on the open market. You know, talking about that um premium, there's a lot of insurance companies that won't um cover risk above a certain level. And so, that can affect, you know, if you decide um to no longer be self-insured, that can affect um your rates. Um the main thing, you know, in being a safety and compliance person is um you know, I'm going to kind of uh go against what our risk manager said a moment ago about um the claims being inevitable and say that from a safety and health perspective and when it comes to um workers compensation is um the the root cause there is the injury and we want to, you know, drive down the occurrence of worker injuries that's going to hit, you know, at both your frequency and your severity of those types of claims. Um, so we're, you know, they're talking about in risk kind of the nature of public service. you know, we do have some high risk industries that, you know, with fire, PD, and power and light, you know, um you're working some dangerous traits and that is known, but you know, going back to that EMR is kind of an indicator that we're doing those in kind of a riskier way than um other municipalities. Um, so certainly I can let um drive back into the budget pressures, but um yeah, so budget pressures can certainly have an impact on u especially safety safety

measures. Uh we need to make sure that we're we're purchasing proper uh PPE, uh that we're properly staffed so that people aren't working significant amounts of overtime um or potentially doing things that that may put them at risk. Um and um also when we're looking at that fund balance, budget pressures have absolutely been a consideration in um when we're coming up with funding for the next year. So you could see how um James on his slide when he was talking about the budget, he had a couple different scenarios when we were looking at the outstanding liabilities um you know how confident we were in what was going to be coming due in the next year. And so um you know there is there is an element of of budgeting and hoping for the best and it's not working. Um, we also have a current structure uh with our departments where they pay the first $5,000 of any claim and then the remainder of that comes out of the risk management fund. And so when we get to a a couple slides later, we're going to talk about some ways that we probably need to do some restructuring on that. Um, started having some conversations internally with the department heads so that they're aware that it's coming up um and that we're going to likely have to to be doing some things differently. um budget pressures are going to continue particularly with the uh workers compensation fund. So last year um as we start to see increases um to that modification rate uh it also drive could potentially drive up our SIR we have to get special approval from the state to do that. if they do not agree to increase it, then we're going out and purchasing workers compensation instead of just excess insurance and that can get very costly. So, those will all be things that we'll have to consider um in upcoming budgets. I don't anticipate um correct me if I'm wrong this year. It

won't be an issue this year, but it will be in next year in the budget planning. Um and then statutory changes. Um, James can speak a little bit more to this if you have questions on it, but Missouri's got some different workers compensation laws than say Kansas has. And so potentially, you know, when we're looking at peer cities, looking at the way the claims go through, Missouri processes things differently and that can also increase our costs. Um they've already mentioned overall claims and then policy development is one of those key areas where when we want to see a long-term decline in both liability and uh workers compensation ensuring that we have proper policies in place are going to be instrumental to that. So that's something that we've been working on um diligently. This is one area that um you know our human resources director is working on policy development making sure that we have the right employment practices and things like that in place so that we can offset some of those types of claims. Um and then staffing changes. Um again this can go back to just having people in the right in the right staff. We've had um we've had a situation where internally we handled risk management uh in 2019 we shifted and we started using Charlesworth um and then but we've lost some of those people internally that would be hand handling some of that. You might remember last year as part of the budget process we shifted to a more centralized uh process which is why we have Nicole on board now. And so just getting some of those things back on track will help us um to offset the cost, but that is a long-term game. It's not something that we're going to be able to reap the benefits of immediately.

All right. Right. And then I know I kind of um touched on this already, but you know, the main the root cause in workers compensation claims is the absence of a safety and health management system to control hazards, which are the drivers of those injuries and illnesses that drive up your costs. So, um, going back to that EMR and kind of looking at our risk compared to, um, other, you know, benchmarks is to say that we just don't have the safety and health programs in place that would control those injuries and drive those costs down. Um, for the financial outlook and risk exposure, um, there's the risk is in maintaining that uh, status status quo. We have the escalating claims costs that worsening negative fund balance um higher long-term liabilities, missed risk mitigation opportunities, reduced financial flexibility and um cultural normalization of those losses. the path to stabilization um is those outstanding liabilities. Um I think did you want to speak or Charlesworth?

Y so sorry.

So what we're going to need from you is guidance. Um, one of the keys to establishing a healthy fund is to have a quantifiable and defendable fund strategy. How much money is enough? What is a realistic goal? And so, here are some of the components to a fund balance. We have our outstanding liabilities. Uh, some will budget 50%, some will go the whole 100%. As far as we know that's happened, we need to have that money in the bank. uh we're not going to spend it in any fiscal year. So that's kind of an area that we see a little bit of play. We know what our insurance costs are going to be. We know what our service f fees are going to be. Well, we can budget those pretty closely. Uh we know our employee allocation if you allocate some of uh costs to uh from departments to the fund. We can do our estimated claim trends. But then what do we want to have as a buffer? as as Melissa mentioned, what we want to avoid is the departments having this roller coaster of funding requirements that they have hard time budgeting for. So we we have to figure out what's going to be our goal and how are we going to develop that goal? Is it going to be three times our highest retention? Is it going to be fiveyear trend? Uh is that going to be the these are there's a myriad of different ways to go about it. Uh and then then you can say, well, if we drip dip below a 75% of that number once we get there, uh then we're going to have to come up with a strategy to build it back. If we get over a certain amount, maybe 125% of that, well, then we can sweep some of that money and and and uh it can be allocated in different ways at the at the direction of the city manager or the governing body. So, this is a key component going forward because as we've tried to demonstrate, we've got

something to fix. We've got to get a plan and and we want to be completely transparent. We want to have a goal that is supported by you, supported by the senior management so that as we go forward, we have a we have a a strategy instead of right now we're just trying to trying to tread water, but we we need a strategy going forward. Yes, mayor. Just a quick question. You may have said this and I missed it. When you're talking about recommending the 50 to 100% including IBNR, is IBNR incurred but not reported yet?

Yes, sir. It's incurred but not reported, but really the more important is the development factor. Claims that stay open just get worse and worse and worse over time. So, we build that development factor. And

can you give me an can you give me an example of a claim that stays open that continues to get worse and worse over time? Well, it happens quite a bit in workers compensation where you know we have a back injury and there's surgeries and surgeries from a liability standpoint. Generally, they don't stay open too long, but if it's a let's say it's a shooting or something very difficult, it gets litigated that gets protracted out as part of the it's part of the litigation strategy of pliff counsel often. So yeah, some of those can can be looked at and we would look at national trends and we rely on our third party administrator for those type of charts to to map out. But the point is it's something that we can put in front of you

and say this is where we're at. This is what our direction has been to go forward. That's why we need to make this budget uh this budget request. Okay. Thank you. Yes, sir. Anything else? Do you want to take this one?

So, as I mentioned before, right now we have a um a policy that the first $5,000 of any claim is paid out from the fund and department that's responsible for it. Uh we have a few options here and the purpose of these is not to punish a department. Um but to kind of back up uh enforcing that not normalizing a culture of loss. So that could be done um by by adding these type of deductible style cost shares. Um there's a couple options here and we can go through those um one by one. Um, so a deductible style cost share. And I want to think about this. The city is the insurance provider and the department is the recipient of that insurance policy. So on this one, it's most similar to what we have right now with the $5,000. Each department pays a fixed amount per claim and then the central risk fund would pay anything above that amount. Um, so some of the design decisions when we do this, maybe it's not just a blanket policy, maybe it's not saying every department pays 50,000, maybe it's based off of department size or claims history. Um, and then we're able to provide those tier deductibles. Um, annual caps would probably be pretty important in this and we need to determine what that would look like because we don't want to cause wild fluctuations within within their operating budgets. Um and then timing of charges would also be important. When do they need to pay those? Another option would be a co- insurance uh model. So a department pays a percentage of total claim costs. So they could pay those along the way, they could pay it at the end. Um they could pay some of it up front if we think that we have an idea of what that total claim cost is going to be and then the risk fund would play pay the remainder. Um,

so for example, department pays 20% of claim costs and then the risk fund pays 80%. Um, and then we we could potentially look at different percentages for that co- insurance. Um, and then setting minimums and maximums. This likely would be what I would recommend the most. Um, a hybrid hybrid structure um combines the best of both approaches. It drives behavior on small claims preventing frequency um and then more management on those medium and larger size claims. Uh it could protect departments from catastrophic losses so it doesn't have a considerable impact on their operating uh budgets. And then um the example structure here is they pay the first 10,000 of a claim. it's 100% the department responsibility and then after that there is a co- insurance amount that's added um and then after a certain amount then the risk management fund uh would would take responsibility of that. Now departments would still pay on the back end when we start looking at those loss claim runs um and determining next year what we would be charging out uh for those internal fund uh service charges. And so this would be on top of that. There are a lot of considerations to take in on that. So department premium plus cost share. Um we want to make sure that they're maintaining annual contributions and then layering the cost share of that on top. So what I just spoke about, uh we feel like this would be a good option for budgeting and transparency. Um, and that we would just want to make sure that we're keeping conversations going, making sure that departments understand their annual loss reports. Um, and then what their open claim reserves are so that they have a an understanding of what might be coming

forward. Um as far as budgetary impacts and then forecasting that cost share exposure, uh we do recommend a government or governance and policy. So adopting a formal policy that defines what this looks like um so that there aren't any surprises to to departments so public can clearly understand what's happening and why. And then also this is probably something that should be reviewed annually. um and then making changes as necessary. Uh because maybe we want to start with a lower um co- insurance initially and then ramp it up so that departments have time to plan in their budgets. Um the other side of this that's not financial is implementing some risk control and safety initiatives. um making sure that there's government governance and accountability from the departments, making sure that they're sticking to city policy. Um one of the worst things that you can do is is set a policy and then not follow it. Um and so we need to make sure that they understand departments know and understand the policies and make sure that that there is that governance on the back side of it. Um and then policies that support fiscal stability. Um, and then obviously the most important thing is promoting those safer operations across our departments. Making sure that our employees go home at the end of the day. Finances are very important, but we want safe people um and safe public. All right. So, I'm going to drive in a little bit more on the specifics to those um particularly in terms of the safety and health side, but um you know have here three definitive steps that we could take to start reducing those losses. Um one is to complete the comprehensive loss control audit. So, up to this point, I think the city hasn't

really looked comprehensively at what is driving all of its losses. Um I've begun some of that work in workers compensation um that kind of look at those trends and the rates and what we're seeing in terms of injuries and illnesses. Um but doing that for all of your your risk lines would really help um the city see the broader picture of um where you know future policy is needed. Um I recommend establishment of an enterprise risk management program supported by um top city leadership. Um so you know with the information determined from that loss control audit um you know putting together a risk register to say what the city's risks are and how they're going about controlling each of those risks. Um um there are some international standards that can be followed on you know how to complete that risk management program and you know specifically for the safety and health side is develop policies and programs to control safety and health hazards and there are of course national and international standards that can be followed there as well um that the city should look at in setting as um their practice particularly in the United States. there's the Occupational Safety and Health Administration and um complying or you know aligning our programs with that national standard. Um so that would be my recommendations for um control of those losses. Yes.

Anyone any questions? Oh, please proceed.

So your excuse me your recommendation is to do a a risk assessment. Would that also come with appropriate staffing assessment? And I ask that, you know, we've we've starved our park system pretty much in the last couple of years because we've had budgetary constraints. And so I want to be sure that we're thinking about both sides of that equation, which is are we having safe practices and do we have the appropriate staffing for people to be working within their scope. So hopefully that would be both parts of that. And of course that would be the management's decision on how they would go about that. But I hope that would be a consideration. Thank you.

Anyone else? Please proceed.

Thank you, mayor. A lot to digest here and and try to understand. Um so I'll just open open this up, Mr. City Manager. So the goals that are here on on number five passes to stabilization fund balance components are these different um goals that we can look at so we are able to eventually budget into the appropriate departments at that time. I guess in the bigger question is what is it that we can do to try to help make those policies um palable to work within our budget?

Yeah, I'll go ahead and chime in. I think it's a multi-prong approach, right? I think you've heard that um there's budgetary constraints, right? Staffing's compounding the problem, uh safety protocols, those kind of things. So, I think it's going to be a multi-prong approach. I think at this point in time this is really good information for us today. I think we need to dive deeper right we need to better understand what programs and services are available to us how we can better approach this from both a a fiscal responsibility perspective a staffing perspective but then what are those internal controls that we can also start to look at. Uh so I think the recommendations that are being uh introduced here this evening uh give us a little bit more uh comprehensive approach and a deeper understanding of of what the recommendations are ultimately going to look like.

Y anyone else other questions? Please proceed.

So uh certainly appreciate the report and the information. Um, this is something that we started talking about at least a couple years ago and um then fine-tuned it last year by making some strategic changes. Certainly happy to see Nicole here and um that's part of that process. And I I guess one question I have is what is your plan to um address the the negative balances in the two different funds? Is there a um I mean that those are those are substantial and so I just kind of wonder I mean I appreciate the other um recommendations relative to dealing with the the current issues and current budget years but but those are really some negative uh numbers that need to be addressed. they are. Um I think one of the first things that we need to do is really dig in and get a better understanding of the outstanding um liabilities that are currently open. Um what's likely to become uh because I guess I should differentiate this like those fund balances are what is expected, right? It's not where the fund is sitting maybe from a cash perspective. it's what we're planning on those open liabilities and those are those kind of things that you see down at the bottom of the fund summaries. And so we know that with those open liabilities that that's what the fund balance is going to be long term. And so we have to come up with a funding strategy to get that right sized so that as those cases as those open claims start to get settled that we have the funds available there to pay for them. Um, and so really the only funding strategy and why I lean right now a little bit more into something like the hybrid structure is because it takes the

pressure off that plan immediately and starts shifting the cost more onto the operational side. Um, it also like I said it starts u curtailing the departments a little bit on getting used to a a a culture of loss. Um because right now uh things go into the risk management fund, they go into the workers compensation fund and so it might not be something that they even feel on the budget side and it just doesn't help to foster that um that the idea that hey we're really paying for this. These are true expenses because they're not seeing them within their own budgets. And so th that is probably the thing that I think we can do the first is to stop um paying those directly out of those funds. it could reduce some of those liabilities that are existing there right now. But that does have an immediate operational impact on on the departments and so we have to balance that. Um there is no easy solution to get us out of here um out of the situation that we're in. And so it's going to take it's going to take a while. Um a lot of this is getting the right people on staff which is what we've been working on. um you know, really hitting that that factor in the last year, getting Nicole on board, um starting to centralize, getting more staff. She's going to be hiring to have um another um safety person on staff so that they can start targeting some of the departments that maybe haven't been looked at historically. Um and so, unfortunately, there's there's no easy solution. There's no just lump sum of money that we can we can put over there um to fix those fund balances. And so it's it's going to take a little bit of time.

Well, I knew there was no easy fix. Um we've been talking about this in audit and finance for as long as I can remember. Um and so um I just wanted to uh see if I appreciate the the information and appreciate the way you're looking at this. All right. Thank you. Thank you. Anyone else have further questions? Anyone else? Council member Wy, any questions for you? No, thanks, Mayor. I I would just add that I do think this is um a a topic that audit and finance can keep working on and take a deeper dive into. Thank you. Okay, I just want to say thank you all for the presentation and thank you for the information. So, thank you very much.

Okay, thank you. Mr. Mayor, please proceed. Uh just for the general audience to know that there is a tornado watch. So, if you're somebody for whom transportation in bad weather is worrisome, I'm just putting that out there for your information. Thank you very much.

Okay, the next presentation is the historic sites master plan. And who is going to present that? Mr. City Manager. Honorable mayor, we're going to uh bring up representatives from our consultant PGAV, Mr. Andy Struckhoff to walk through the next presentation.

Thank you. speak into the mic.

What do I uh what do I do?

Get it up on the screen. You going to do Thanks. Okay, good evening. Good evening everyone. My name is Andy Struck. the president of PJV planners. We worked with city staff and uh communicated also with stakeholders associate with these historic sites on this um work we've produced. Speaking of you know the your presentation I think closed with a statement that there's no easy fix and this similar statement could apply to the the historic sites managed by the or owned by the city of independence. Okay, I'll do the best I can. How's that? Is that better?

All righty. Thank you so much. So, the purpose of today's work session going to talk through the historic sites and their existing conditions and talk through a few options for governance going forward. The overarching goal being their sustainability. So, these are the nine sites we're going to talk about this evening. largely located around downtown Independence with some further away. The Veil Mansion up near Al Elementary in the Truman Depot near the railroad tracks. You know, Bing and Wagner estate. It's 19 acre historic estate near downtown Independence. It's operated by the Bingham Wagner Historical Society. The city owns the property. The city is responsible for maintenance and capital improvements to the pro to the building of the site and the historical society is responsible for operating and pursuant to an agreement with the city of independence. operations include, you know, keeping the building open for visitors, hosting events, managing the gift shop, um maintaining all of the contents of the home, the furnishings and other historic artifacts, and acquiring additional artifacts for the for the estate. The Veil Mansion, Victorian mansion, dating to 1881. It's operated by the Veale Society in a similar fashion. You're pursuant to an operating agreement with the city of independence. Strong volunteer engagement, increasing restoration needs and associated costs. Um just as with the Bingham Wagner estate, the veil operates the mansion. They host events um and various functions in the museum. They host tours. Uh they are also responsible for the interior contents of the property.

of the city is responsible for the maintenance of the property. Historic firehouse number one is downtown on the square. The National Park Service has the visitor center on the first floor. There had been some anticipation around the federal government moving that visitor center out to another building and that is no longer a prospect is my understanding. So they will stay there. Uh the 76 fire company leases the lower level for a nominal amount. And the city owns the buildings and pays for utilities and maintenance. The Chicago Nton Railroad Depot. It's a restored two-story railroad depot. It's operated by friends of the CNA depot. Offers free volunteer-led tours and the city pays for utilities and maintenance of the building. and it's located right nearby the Missouri model of railroad museum which is located in the wagonary gates building. It's a volunteer operated museum which charges for admissions and special events and attracts visitors from across the region. This building also houses the Merryill J Mattis Research Library. The Oregon California Trails Association is a tenant in a two small two-story building adjacent to the Missouri Model Railroad Museum. Uh they lease that building from the city. This organization is a national organization focused on trail history. They support the National Frontier Trails Museum um and have close relationships to trail related site trail related sites across the country and their archives are housed in the Merryill J. Mattis Research Library archives being diaries and other uh primary sources of history from pioneers moving to and through

independence um across all the Overland Trails. The National Frontier Trails Museums the Cities operated museum located in the Truman Memorial Building. Its focus is on telling the story of Westward expansion along the trails. offers free admission staffed by the city with volunteer support and really is a flagship tourism asset for the community. The Truman Depot is an active at Amtrak Station and Visit Independence leases this building and holds their offices there. The 1827 Log Courthouse located, you know, near the downtown square. It's the original Jackson County courthouse. The city owns and maintains the property, currently has no regular operations or staff and experiences limited public use. Then the Pioneer Spring Cabin is situated, you know, between the Chicago and Alton Depot and the Missouri model Railroad Museum. The city owns and maintains it. Currently has no active programming and is used for storage. So across this portfolio of sites that's owned by the city and and operated by various others pursuant to certain public private agreements. There's a wide variation in in use at staffing ranging from the spring cabin on one end of the spectrum. It's basically used for storage to you know the veil mansion the big wager estate um which are dynamic properties that attract a lot of visitors and host events. Also, you know, volunteer capacity isn't spread evenly across the entire portfolio. Um, for the same reason I just described, each property has increasing maintenance and capital improvement responsibilities that they that the city must bear.

All of which leads to, you know, the fact that the current operating situation isn't sustainable in the long term for the entire portfolio. So let's talk about some ideas about what to do for the future of these sites.

Okay. So let's talk a little bit about some ideas for the future governance and sustainability of these sites. Recognizing that the city has limited resources and many priorities compete for its limited resources, future considerations for the ongoing sustainability of these historic sites include transitioning them to private ownership, establishing a nonprofit conservancy to manage the sites, or keeping the properties under city ownership. Private ownership opportunities associated with this idea would be relieving the city of the costs associated with maintenance and staffing would enable volunteer groups to solicit contractors for maintenance or improvements outside of the city's procurement process. And this is something we heard from some of the volunteers, particularly those active with the veil and with the Bingham Wagner, is some frustration and some tension really uh because of the need that they conform with the city's procurement process um and the concept that they'd be able

Okay, I heard you you're saying because of the airflow he needs to speak clear and probably straight into the microphone. So, okay. And I know it's hard to see the screen and speak clearly into the microphone straight forward, too. So, yeah, you can turn the you can turn the entire All right. Okay. Thank you, Jeremy. Good suggestion. Thanks, everybody. I appreciate it. Thank you. Um, and get you've got to get really close to the microphone, please. Okay. Thank you.

Is that okay? I'm just trying not to put it in my mouth. Um, so what I was saying earlier is in talking with city staff and in talking with stakeholders active with the historic sites in particular the veil and the bigum wagner. We understood there exists, you know, some tension between expectations of what the city should be able to do and what the city hasn't been able to do. A couple years ago, the city asked the voters of the city of independence to approve a general obligation bond issue that would go toward improving these sites. You know, the voters said no, and so the city hasn't had money to put it into the sites. The sites themselves can fund raise to pay for certain improvements, but then they have to follow the city's procurement process to pay for any capital improvements on the sites, which takes a lot of time and also means that they have to conform with prevailing wages and other ordinances associated with bidding for public projects that slows things down and and can make them more expensive. So the idea here is that transitioning them to private ownership would free these sites up to operate as efficiently as they would like to encourage fundraising and potentially create more opportunities for them. The obvious challenges are, you know, the sizes of the capital improvement expenses and the depth of the donor pool in the area that these folks would would ask would go to for money. This is one idea. Here's a case study. Uh the Campbell House Museum in downtown St. Louis. This home was built in 1851 and was home

to the Campbell family until the death of the last child and surviving family member in 1938. A few years later, by 1941, a local group calling themselves the William Clark Society uh decided to preserve this portal to the middle Victorian period and purchased the home and much of its contents through an auction. Uh the organization continues to operate this museum in downtown St. Louis and they've been been able to over the years raise an endowment, add on to the property and keep it really well maintained. So this is an example of what you know private ownership could look like. Oh wow, that's nice without the air conditioning kind of humming in the background, isn't it?

It really does. Okay, the the next idea is a consery. Now that is establishing, you know, not for-profit organization dedicated to the stewardship of historic places or districts that have significant historic value as these sites we're talking about this evening. These organizations may operate on their own as nonprofits or in a public private partnership established to ensure preservation and public access. The opportunities associated with this structure are similar to the private ownership structure, right? Um be a way to help the city with costs associated with m maintenance and staffing, enable volunteer groups to solicit contractors for maintenance or improvements outside of the city's procurement process, encourage fundraising, and potentially create more commercial opportunities for the sites. The challenges are also the same. the capital improvement expenses associated with all the sites and the depth of the donor pool in the area. An example is this park, Lafayette Park in also in the city of St. Louis. This is a city-owned park uh which you know the city pays for maintenance, you know, grounds maintenance, tree care, utilities, etc. But the conservancy, which employs an executive director, hosts events within the park and raises money to pay for the restoration of certain historic places in the park, like the gazebo pictured here. The last idea is city ownership, which is the which has been the operational program for decades. Of the nine historic sites we we're talking about this evening, six of them have operating agreements with uh other groups that effectively run each site on behalf of the city. Each of these agreements are

unique to each property and most run on a continuous basis until one party wishes to leave. However, some have had limited numbers of renewals. The remaining three properties are maintained solely by the city do not have any programming or bring in any revenue. Now the opportunity is you know this these historic sites this entire portfolio together are an important part of the city's tourism economy. You know the challenge is as we've we've talked about you know deferred maintenance and capital improvement needs are expensive. The city could ask voters to consider bond issuance again the proceeds of which could address capital improvement needs. Should the city take that action the city would be required to maintain ownership until the bonds are fully repaid which could be as long as 20 years. So, our recommendation for your consideration, you know, no vote or anything is is this isn't for a vote or anything, just just for consideration. Um, establish a conservancy to own or manage these six historic sites. the historic fire station number one, the Chicago Dalton Railroad Depot, the Pioneer Spring Cabin, the buildings that house the model railroad museum and octa, the Truman depot, and the log courthouse. The key aspects of this situation that lead to success would include the following ideas. you hiring full-time employees for each site, hiring a conservancy manager that can offer a dedicated and unified effort toward the success of these sites. Really just a cohesive management structure and a detailed business plan to refine revenue strategies, staffing assumptions, capital priorities across this portfolio. Even within this smaller portfolio, there are pretty different properties. undertake an early capital campaign of say five or six million dollars for this six property multi-sight heritage

portfolio and pursue a combined endowment strategy so that each site would be endowed with a certain amount of money to pay for ongoing maintenance costs. Next recommendation, private ownership for the Veil Mansion and the Bing and Wagner estate. All right. I know. I know. I know. Hold on. Just Just

give me a couple minutes here and I'll I'll tell you why those two. Um the the veil and the being in Wagner both bring with them a lot of history and a lot of energy and both have very very engaged volunteer groups as you all are here this evening because you care about them a lot. The idea would be to free them from the challenges of the relationship with the city and the city ownership by allowing them to be sold for a nominal purchase price of say a dollar. I think the ideal purchasers of these properties would be the Veil Society and the Bingham Wagner Historical Society. And with that transaction would run, you know, deed restrictions and/or preservation easements which would stipulate that the property couldn't be changed in an immaterial way like they would need to continue to be historical sites. Therefore, the access and enjoyment of the residents of the city of independence and other people who like to come and visit them and enjoy them. That's the idea. It's not open for the discussion right now. We can answer I'll be happy to answer any questions for you. I'm sure he will be too, but it's just his opportunity to give a presentation. Thank you. So, each site has capital improvement dates which could be $8 million or $12 million or more for both sites together. Some things to think about updating the capital improvement and repair needs assessments I think were done in 2018.

Updating those for the being Wagner and the Veil mansion. This cost maybe $8,000 per property. issuing a geo bond to fund improvements, which would carry with it requirement that the city owns the properties until the bonds are repaid, or a one-time investment from city funds, for example, from revenue generated by the data center to improve the buildings before selling them. Okay, moving on to city ownership for the National Frontier Trails Museum suggesting that the National Frontier Trails Museum be retained by the city. The city currently staffs and operates the museum within the building and maintains the Merryill J. Mattis Research Library in the same building with this Missouri model railroad museum. The National Front Trails Museum is an important cultural center that really completes the story of the history of the independence area for visitors as they learn about pioneers venturing westward and the life of the 33rd president of the US, Harry S. Truman. A related recommendation is that the city should also consider the creation of a new standalone building for the National Frontier Trails Museum that could also house the research library. The city should pursue a feasibility study to help them understand the costs associated with development as well as ongoing operating expenses and revenues associated with this museum and a new standalone building. So next steps ask you for feedback on these ideas. Um ask for any concerns or priorities you feel we should think about and open up for questions.

Thank you. Any questions? Please proceed. Sorry. Can you talk about historic tax credits because I know those are one tool that have been used in other places and I very imperfectly understand whether cities can apply for those or city public partnerships can apply for those. Can you explain?

Okay, I will explain the best I can. historic tax credits. There are two there are federal historic tax credits and state of Missouri historic tax credits. And um private owners of an historic property can apply for tax credits equal to a certain amount of the restoration costs of the property. Those tax credits can then be sold to another person or entity who has an income tax liability at the federal level or the state level. In exchange for those tax credits, the owner of the property may get anywhere from 70 cents to 90 cents on the dollar. It's a way to raise equity to pay for improvements to an historic property. And those bring with them certain requirements about a what they can pay for and b you know the nature of the restoration like the property needs to be kept um in its original historic character. There are requirements and guidelines around how that money is spent so that the look and character of the building doesn't change.

So I'm I'm asking a question. Can a city apply for and sell historic tax credits? Because we would be the in between. Obviously, we don't owe state income tax and we don't owe federal income tax, but are we able to sell them on behalf of the historic site to a third party who owns that or who owes the money? I don't know the answer to that question. I apologize, but I will research that and get back to you on it. Anyone else? Other further questions? Mr. Mayor, please proceed.

Um, when did we take ownership the city of the Bingham Wagner and the Veil Mansion? I believe it was sometime in the 1990s. Okay. Do we know if there was any type of agreement in place at that point when we took ownership on whether or not if we ever wanted to vive vest? if we wanted do we know if there was any type of agreement when we took ownership if we were ever going to divest the ownership what we were supposed to do with the city I don't believe society because we have a copy of the society was formed shortly after Mrs. the wind died.

There's currently an operating agreement between the city and the the big and wager estate. Okay. All right. One other question. If the city would retain ownership and they're still doing their own fundraising, is there any way to exclude those two sites from their procurement policy? I feel like that's a city attorney question. The short answer is no. As long as they are city facilities, uh they're going to be subject to the city's procurement policies.

Okay, I guess that's all I have. Thank you. And and I I apologize. The uh the city's ownership of the being Wagner dates back to the 60s, not the '9s. Council member, please proceed. Um, so I I think this might go to city manager or assistant city manager. Is that what you are now, Lisa? Are you back to assistant? Deputy. Okay. Um, so what is the total annual cost to the city for all the sites combined now?

Was it that So 10 million uh maintenance alone combined between the Veil Bingham. Hope I'm understanding the numbers right. She is running annual operating. Okay. I have the maintenance costs but not operations. We we can get that number and get back with you. Yeah. just what it cost the city to run all of this the sites. Anyone else? Please proceed.

So, let me make sure I understood something because I I have a little hard time hearing at one point. Were you saying that the current operation, the way we're currently operating is not sustainable in your opinion?

Yes. Okay. So you're saying that essentially what we have an option is is to to look at these some of these alternatives and and they might allow us to you know define or identify ways to proceed going down the road or if otherwise the the buildings will just continue to deteriorate and be eventually you know not usable at all. Is that would that be your assessment?

Yes. So really what we're looking for here is either, you know, a large investment of capital from the city via a bond issue into these properties or finding ways to help the properties run more efficiently. uh which could involve, you know, establishing a conservancy to help them run together andor selling a couple of them um to the not for-p profofit societies that currently operate them uh to let them hopefully run in a more efficient way. Okay, that's what I thought. I just want to make sure I was clear on the that on the sustainability piece of the puzzle. Perkins, please proceed.

Thank you. Quickly write down my thoughts. Um, first of all, I want to say thanks for all the uh hard work, love, and support everyone here does for the uh historic site. So, thank you for doing that. Second, I'll uh I'll do a little little apology. I'm sorry that you guys did not get a a sneak peek at this before this was made into a study session. So, going forward, Mr. city manager. Can I recommend that we with with with our historic sites, as you can tell with the love and passion that our community has that that we as we do these types of studies that we work back into their um respected groups to be able to get some of their feedback and and digest. So, obviously this is study session. We're taking a look at all of the um sites and assets that we have here cuz I think we can all agree what is taking place isn't necessarily working. I think we have a great opportunity here and I didn't even think about this one. Councilwoman McCandless about the historic tax credits. That is um an excellent idea that I think we do need to pursue and maybe put into the mix there. the ability going forward I think is going to be the on the council's responsibility to be able to see and to work with the groups to see what is the best hybrid and combinations that we have going forward. I'm not super in love in in in divesting ourselves from these historic sites. I think we can find some happy medium there. I think there's room for discussions. We were very close with the geo geo bond. Uh I think we were 170 votes short. That's pretty close. I think that is an option that we can discuss in the future as well as we are going to have economic development dollars come in that we can use. This the council is also going to develop and work on future funding and budget

planning for these types of issues. So the timing really couldn't be better. So, I think the the future conversations are going to be had and probably had more sooner than later. I don't live too far from the Veil Mansion. I live off of Silver Lane there and I love the Veil Mansion lit up at night. It looks magnificent with snow all over it and I want to see that thing taken care of and I know you do too. So, there's a lot of work still left to be done. I want to say thank you for being here and showing your support uh for the different options and stuff. So going forward, is there any next steps that we can begin to look at, Mr. City Manager, Andy, or or Deputy City Manager?

Yeah, I'll go ahead and take a uh so thanks to PJV for their um their initial insight, observations, and recommendations. Uh absolutely. At this point in time, this is where we take this back out to the community and the respective stakeholders. Uh garner their continued feedback and recommendations. Uh and then as we continue to work through the budget, um knowing and understanding our budget constraints, uh we'll come back to you all with some recommendations based on some of those ongoing conversations. May not necessarily be this budget cycle, maybe next budget cycle, uh but certainly it's it's something that uh uh to the comments made a little while ago is not necessarily a what we're doing today is not a sustainable business model, right? And so we've got to do something different. Um, and so I think this is the the introduction to the conversation uh knowing and understanding that we're going to continue to receive input from the community um from the governing body over the next several weeks and months uh as we make a more informed recommendation.

Mr. Mayor, and as I'm thinking out loud and I might u stir up a hornets and I hope not, but at some point um perhaps we should get the the Big and Wagner group and and the Veil Mansion group get them together so we can uh get your questions answered and have some of that good dialogue of of back and forth of what some of those next steps may be. I think that's what kind of the things we need to do. Thank you, Mayor. Thank you. Anyone else have further questions or comments? But yeah, please. Honorable mayor, to answer Council Member Vot's question, uh annual operating costs are about $125 to $150,000 a year

for all sites combined. For all sites combined. Annual operating costs for all of those sites combined are approximately $125 to $150,000 a year. That does not include the deferred maintenance. That's just the operating expenses. The deferred maintenance costs and the capital improvement needs are what was identified in the presentation. The operating cost just to operate the facility separate from the maintenance and capital costs are about $125 to $150,000 a year. Okay. Anyone else other further comments? Okay,

Mr. Mayor, please proceed. I'm gonna keep going just just so I can have it on my shot clock, Mr. City Manager. Um, let's try to circle back up within 45 days or 60 days or less for sure. Um, before we get really deep into the summer. Well, gosh, we're going into FIFA time, aren't we? Um, budget, too. Um, well, let's get on my shot clock for a strong 45 days to get together and work with the respective communities here and get this together so we can have a deeper conversation.

Thank you. Anyone else? Okay. Thank you very much for the presentation and anything else, Mr. City Manager, from your perspective. Okay. The next item on the agenda is the IPL governance. Do you have any uh words of wisdom on how we proceed with this topic? Yeah, honorable mayor. Uh on this one, I'm going to turn it to Lisa Reynolds. Thank you.

Good evening, Mayor and Council. Um this topic is really there's no formal presentation this evening. This is something that we've been talking about um in several meetings over the last couple years. Um to be honest, just as a recap, the conversation started in 2023 um when we commissioned a study from a company called DKMT to review um a couple things about our electric utility. Um one was the potential what it would look like to divest ourselves of that utility and then the other was just an operational overview of the utility. And following the results of that study, one of the primary recommendations that came out of that was a potential change in recommendation to change the operational governance of power and light. So this conversation again we have talked about this um just in 2025. Uh the council has discussed this in meetings in March and Octo March and April, October um through the summer in June and July. Then again we had another round table um with the council on January 13th of this year. Um and all of those meetings basically have culminated in what does that structure look like and ultimately what is the charter change language that would be required. And so I believe, sorry, allergy season. Um, at that last meeting in January, we finally came to terms on all of the outstanding issues. The primary two outstanding issues had been um what is the composition of that board and how many members um need to live in town, if any were going to be allowed. We landed on um all members of that board having to either live in town or be a rateaying customer of the utility. um ultimately was decided that four of them need to be residents and up to three of the members

could be non-residents but rateaying customers of the utility. Um there was some conversation around what was allowable use for economic development. Um and then really the economic development piece was that final piece and then of course um all of the associated charter changes. Um again those have all been sent out. there in several iterations um online in our past agendas. But to move forward, we would need council direction on whether or not we still were interested in taking those changes um to a ballot measure for the voters. Oh. Oh, and one other I would be remiss if I didn't mention the com one of the final pieces of the charter changes would be a requirement that if we were to ever consider selling the electric utility that that would have to be put to a vote of the people. So that was one of the final charter changes um recommended in these revisions. So at this point staff is just looking for um what is the desire of the council to continue to march forward. If we initial conversations had us taking this forward as early as August. Um that might be a little bit of an ask now with the council changing over. We would need to get new council members caught up to speed. and to get it on a ballot in August, we would effectively be asking our new council to vote on it walking in the door. Um, so it may be wise to postpone that some, but again, just looking for direction, council, in um, taking that forward if that is still a desire of the body.

Any discussions or thoughts? Please proceed. Thank you, Mr. Mayor. Um, thank you for the uh, recap there. And boy, we did have a lot of meetings, didn't we? We did. We did and a lot of good work. I would strongly suggest that perhaps we just move this into a future day for further conversation with the the seated council and to get our new city manager completely up to speed there with that as well. I think that would benefit our community greatly. Anyone else other thoughts? Mr. Mayor,

um I would agree with that. I think the um move it to a future date. I still have some a couple of large objections to some of the language as it relates to how many members and whether or not they need to live in the city or not. So, I would like to get the inputs from the next council members as well. Anyone else have their thoughts?

You know, I'll just chime in because my opinion doesn't matter at this point, but I'll just chime in. I know they're talking about uh I know my place. I know we're talking about an August and November and I think I'm the only person on this dis who is has ran in both August and November and also ran in February and April elections. This utility is owned by the citizens of the city of independence. If you go on the ballot in August or November that's that will those people be owners of the city of independence that vote in those ballots? Yes, they will. But they are not municipal voters. Municipal voters are much different than general election voters. I have talked to all of them on both sides of the equation. Municipal voters, and I don't mean any disrespect on this and I'm leaving and so you can throw darts at me, but municipal voters are incredibly in tune with the issues that are central to our city. General election voters in August and November are typically voters that are focused on state and national issues and not focused on municipal issues. If the new council wants to proceed on this, it is my highest recommendation that you put this on a February or an April ballot of next year to allow those municipal voters who are really in tune. And I'm not saying that the August or November electorate is not in tune, but they h they you have a much different uh perspective of those voters that come out. And that is and that is my bias. That is my perspective on it. And if I were still seated on the council, I would push heartedly for that decision to do that. It also gives the new council the opportunity to really look at those issues and to think about them and to gather their thoughts and to and

to work with staff and to work with the new city manager and what are the pros and the cons and how to and to go back and look at the other models that we looked at the Springfield model or other models and to say do I like this model or do I like the other model so that you've got some time to you know really think about it if you look at the if you look at an August ballot time frame, that is a really short window for you because that's only about what two or three weeks that they've got to make a decision to put that on the ballot. If you look at November, you've got more time, but you're still pretty pressed because you're looking at maybe two or three months to put it on November ballot. But if you put on a February or April ballot, you've got a lot of time to discuss that issue. But it's a truly truly truly a very important issue for this city. It's one of our treasured assets. It's one of the assets that makes this city worthwhile and it's it's one that everyone in this city needs to look at that document and to say how should we govern IPL going forward. This is really a critical decision for this city and for this new council and to take it lightly and to do it quickly I think is is uh shortch changing it. And I want to really point out to the my colleagues here, they worked extraordinarily hard to get us up to the point that we had a document that is a in my opinion a really good document. And so if the last thing that I could say about this governing issue is study it, look at it. And I would recommend highly to put it on a municipal ballot issue because those municipal ballot those municipal voters really study the issues. I I love municipal voters. I love going to their doors. I love talking with the issues. They are extraordinary citizens. They watch everything. Not only the national levels and the state levels, but the but the city levels. They really drill in and they are just extraordinary citizens. They're they they just really drill in.

And I I highly recommend that this council go forward on that. Anyway, I'll stop. I can tell I'm beating the drum too hard and I will stop beating that drum. So anyway, and uh I'm gone in a week, so you can disregard this. And if you want to, you can even erase it from the tape. Um I cannot. Anyone else want to say anything to add to this? Did I beat it to death? We we've got that horse. Uh stop beating him.

I might just add to that just slightly. And that is that you know this is a really really important uh issue I think for independence and in particularly for the um the electric utility because the the primary purpose you remember that we started with this was to take the politics out of operating electric utility and that's really the primary goal. So, um, while I don't disagree that this may need to be delayed a little bit, certainly it's really critical that it's not forgotten. And so, um, so, uh, that's really all I have to say.

Council member Wells said, it's it it can certainly be delayed, but not forgotten. And I think that's critical for the new members that will be on the new council. Uh, anyone else other thoughts? Anyone else? Okay. Thank you very very much for that. That brings us to the end of our scheduled agenda, information items only. Madame City Clerk, anything that you need to add? So, nothing there. Uh, Mr. City Manager, this is your first study session. You have successfully, at least in my opinion, survived. So, anything that you would like to add before we wrap it up? Thank you.

Very good. A man of few words that is that'll suit you well. Trust me. Uh, with everyone, thank you very much. We'll call this meeting ajourned.