City Council - Regular Meeting

Good evening everyone. It is uh 6:00 on April 14th uh 2026 and I'm going call this Lacy City Council work session uh to order. Um all council here is present besides council member Dunning and I'm not sure I'm not sure if he's back from vacation yet. I don't think he's back. And so, uh, Council Member Dunning is excused this evening. I also want to acknowledge that we, the city of Lacy, are on the ancestral land of the tribal people, the Treaty of Medicine Creek, including the Nquali Indian tribe and the Squawks Indian tribe. That can I get a motion to approve this evening's agenda? Move to approve the agenda as published. Second. Second.

It's been moved and seconded. Any discussion? Seeing none, all in favor of the motion signify by saying I.

I. Is there anyone opposed? Then that motion unani carries. We have a approved agenda. Uh first up on our approved agenda as we did have receive one public uh comment um written public comment. Um but is there anyone else wishing to address this council this evening? See none. Uh then we'll go into our next agenda item which is our community and cultural events grant briefing. Well, good evening, mayor, deputy mayor, and council members. Uh, we are very excited to be back in front of you to talk about the uh 2026 pilot community and cultural grant events grant award. Um, as you all may recall, we worked through the commission on equity and then through the city council in late fall to bring forward a policy uh for this pilot program. It was funded in 2026 as a pilot with $25,000 for grant funding with awards ranging from $500 to $5,000. uh we uh published a web page on this and did a extensive outreach on our social media accounts to get applicants during the men month of February and we received several of them and um Veronica Hand has taken over the program itself and so she's going to provide uh the rest of the information including the recommendation from the commission on equity.

Well, good evening everybody again. I'm very happy to be here and especially with this subject which is something so important to our community. We received the total uh well we have this the the policy that is just to support our community with cultural events and community events in our city and the greater area urban area. So we received a total of 16 applications. 12 of them did meet the policy criteria. Two, one withdraw withdrew. Uh one was disqualified because they were charging an attendance fee. In the policy we were um one of the conditions of their policy is that the event was free to attend. So this they were charging a small fee. So that's why they were disqualified and two were disqualified because one was not open to the public and the other one was gender restrictive. It was for for boys and and young adults, male. Um, and some of the events have already happened. Three or four of them. Some were on two of them were on April 4th. Another one is very another one April 8th. Another one is going to be on May 3rd. So it because already happened what we're recommending is to allocate the funds for next year if they get are approved. I know you cannot see that but we have that later. So the we have them in order of alphabetical order per name of the event. The first one is the the company is called Hummingbird Studio and their event is called Art in the Park. Art in the Park. This is a very short summary, but it's going to take place at Wood Woodland Creek Community Park. It includes live music and live snacks, a variety of creative activities like and they're bringing the supplies. So, they

have painting, drawing, bead work, and the date would be on July 24 and they're requesting $2,500. the expected audience or uh attendance is between 50 and 100 people. The second one, it already happened. It was in February. Uh the New Life Baptist Church, um it was during the whole month of February, the history, Black History Month. Uh they requested the $5,000, which is the maximum for the grant. So, it would apply for next year in this case. And the attendance is um expected at 150 pe 750 people. They have an interactive museum. I don't know if you had a chance to to visit. It's super super interesting. Very well put. Very interesting. You learn a lot. So there they have a history about the influence of the black community in in not just the area but also the county with very interesting graphics and and statistics and all that. The third one was an organization is uh together. Uh they're organizing what they call the clubhouse community and cultural event. This is going to take place on October 31st and they want to do it to honor the deos muertos and they are asking for $5,000 as well. They expect 200 people. Uh they're going to have food vendors with food related to the loss muertos history. Um they have an aphrena which is like an offering to to the dead and like a with an altar. Uh some ancestral teachings with the granny's oras and then some are activities that are big for the other marts like the the face painting and and papermâché with the mira. And they're going to have also some group performances with mariachi katrina. I don't know if if you know

what is that like but it's like the women who dress like the the like a very elegant woman that is dressed like um skeleton and the sapatia there are some dancers that dance with very hard no like on the floor kind of like the Irish so similar to river dance

yes you got it the next one it's the windman's dignity school this is a very interesting organization It's a very new nonprofit. It's actually started in West Africa. The founder um Mariam Dembele, she's was nominated for the Nobel Peace Prize for 2005, I think. And she started um a school where she was teaching women to be economically independent. So, teaching them skills to survive and also how to manage money. and it extended from Mali where she's from to Sagal and other countries in West Africa and now she's opening it here because she's living part-time here. So she's already doing some leadership classes for women and other activities. Very very interested workshops on leadership development. And then they're also going to teach other skills to women. But they want to h have this cultural gathering with the community promoting the West African um culture with drumming the African an African meal and promoting also the West African culture. And they also want to have a guided conversation with the community. That was the important component for them for the that the music and the meal and the cultural part. Of course, they're asking for $5,000 to uh the event will take place on June 6 at one of our city parks and they expect 80 people. This one fit needs. They have a lazy community food and grill outreach. It will take place on July 18. Uh they're also asking for $5,000. They expect 350 people and it's just to give away a hot meal, have community provide some groceries and meals, hot grill meals prepared on site and support uh families

with food insecurity. But they wanted to do it in have or happen in a way that is very respectful that relieves the stigma of people who are struggling economically and they are also have this I like they have connection to local partners with resources um and they want to also use it as an opportunity to strengthen neighborhood relationships. The Indian-American Star Foundation uh the event already happened. It was on April 4. So again this request the allocation of the funds if approved will be for next year. They had what is called the holy festival of colors. Um what they do is they celebrate the unity and diversity and you can see like the powder that's like part of the the festival of the colors. So it's observed in in in the spring and it represents the end of the winter and the triumph of good over evil. So that's why they throw the colored powers and it what they want to do is empower children and youth with recreational programs. They ask for only $1,500 and they expect to have about 75 to 100 people participating. I think this year was the first year they organized it too. Um this is a an event that has been happening for a while very popular. the Polynesian Association of Then County with Polyfest. They're This is a two-day event, so it would be June 26 and 27. They're asking for $5,000 and they're expecting 5,000 people. So, it's a very big event. Um they're showcasing the culture for all these co countries or cultures uh the Polynesian countries, dances, music, uh some Polynesian groups and of course food vendors and craft vendors.

Joel, this is another one that already happened. They had the local news day. It was on April 8th and they were expecting 325 people and they were asking for $5,000. So again, they we will have to use it for next year. But what they wanted is just to bring together national speakers and talk about the state of local news in our county and just keep residents informed of of and of what's going on and keep um whole leaders accountable. Olympia youth cor chorus. I always have a problem pronouncing that word. I'm sorry. Uh so they want to have a holiday concert on December 14. They're asking for $1,800 and they expecting to have 600 people. So that's a big impact. They just want to experience have the community experience the joy of live coral music or choir music and provide a stage for the youth to perform. This one is another one that already happened. This was also on April 4. Um they are also asking for $5,000. They were expected 100 people participating. This is a very complex large event. So they were having the cultural wellness um healing trauma healing event. They were having some grounded healing uh and all of this is based on healing trauma PTSD. But they do it with this um method called or archetype called Lar or LP which involves the heal person who wants to heal it represents a character and they will have or they had bipok vendors and and the cultural marketplace as well. But this is all based on on healing and and healing trauma.

Uh I think last but oh no we have two more. Uh so this sounds south sound studio it's also not a new event but it's been very popular. It's self-guided tours and they explore they go to the workshops and houses of art local artists. So they go between Lacy Olympia and Tom Water. They visit the all the artists that those are the different um types of artists. So, painting, drawers, woodworking, ceramics, jewelry, and they just learn about what their artists are doing, the their work and and their gaps, challenges, and all of that. But it's also so that can they can meet the artists and learn about the their artistic processes. They're asking for $5,000. The event is on two days and weekend, May 30 and May 31st. And they expect 150 people participating on this one. And then now this one is the last one, the Thome County Food Bank. This event is very close. It's on May 3rd. Um they're asking also for $5,000. Um they expect 100 people and it's just to raise awareness. Oh, I forgot to change. Sorry. to raise awareness and support neighbors experiencing food exe insecurity and symbolizing solidarity with neighbors experiencing hunger. So after we presented well the options to the commission on equity their recommendation was to prioritize the funding for events. Some events are cultural events, some events are community events, but we that we're recommending to predators events that are both community and cultural. So if we do that, we will be funding eight events that are both community and cultural events. So the eight applicants could receive almost 75% of the request

with a total allocation of $25,000. So that would be the option recommended by the commission on equity. The second option that we were recommending is to prior to prioritize five applicants for full funding. So five at $5,000. The third one is to equally distribute the $25,000 among the 12 applicants. So that would almost be a 50% of the requested amount per applicant for the total of 25,000. And then we there may be another option that you could consider that we're not presenting here. And in this meeting, we would just like to request the discussion to have a potential act action for the meeting on May 5th. Well, I've always been one to follow the recommendations of the advisory bodies that we have in place. You know, the the Commission on Equity is there to sort of um analyze these issues and um and help support, you know, our community and cultural events. That's, you know, a big big part of of what uh we're hoping they're they can do. And if they say we should prioritize the funding for community and cultural events um and it be the eight applicants that I I would tend to um go along with their their recommendation, but I'm open up to the full council for consideration.

I I would tend to agree, but first let me thank you all for all the work you put into this uh staff and um the commission. Um, I agree with option number one, but I'm just curious to know what went into your thinking. How did you Yeah. Why did they come up with that? I agree with it. I definitely agree with it. I'm not likely to ever agree with uh something like an option three. I might think about option two, but I I like option one. Just wondering what went into that.

What was what was some of their thinking on that? Well, it was based in the policy and wanting to promote the the something very holistic mostly, but it was a very interesting meeting. It was it took us by surprise how fast they arrived to this conclusion. We thought there were going to be more discussion.

Um, but there was one proposal for one of the members and they also it was unanimously um asked. I would just add on maybe just a little bit to that and you know I think again the the the recording's out there so certainly you can hear them verbatim of kind of what their perspective was but they were taking a look at it like Veronica said of it being a community and cultural event grant and so if you kind of hit both of those categories prioritizing it over hitting one of the categories was effectively what we heard

and um received they would receive 75% was there ever some conversations. Can they if they receive 75% of their um requests, can they go forward with their events, you know, or is this something that we need to look about in the in the future about u maybe raising the the dollar amount? I mean, $25,000 is obviously not a lot of money to put, you know, put on cultural and community events in our our community. I understand that. I know this is our first year of doing this, but you know what what are the lessons learned so far uh about you know this process do you think we should take away?

Well, in the interactions with the applicants with the ones that I talked to, they really were depending on this money. Uh some of them were uh a little concerned that they were not the ones that already happened like the Joel for example. they were concerned that they were not going to have access to the funding if they were approved by the time they had the event. So it seems like they really needed it and they depended on it. However, they proceeded with the event in this case. So for what I learned from them, yes, it it it they were counting on this. It will make a difference and yeah, of course, it's definitely not enough.

And it was very successful. I was surprised that we got so many applications and they were very very thorough.

Well, I I think one lessons learned if we're going to have funding available for a year's cycle, then we probably should have opened this up in, you know, end of last year or open up, you know, end of this year for the following following year. And so I I guess that would be my first recommendation is if we're going to do this, let's probably shift the time frame a little bit so we can look at funding for next year. Um, of course, now we have, you know, a couple people we can be maybe be pre-approved for that. Um, and we can hold hold those dollars back and do that. But I would recommend if we're going to do this again that the application should come in in the fall and we should make the recommendations for the following year.

I I will add um I think that that's certainly one way and something that we can take a look into, but I think just making it a calendar year cycle of the funding and it's very similar to what we do um you know for example with the human services grant is it's not a you know calendar year from January 1st to December 31st but it's from when the funding goes out to use for the full calendar. So, like Veronica mentioned, you know, there were several events um that have already happened. And so, the question of, you know, the budget, would they still happen, you know, they still happen to some extent. Um they may have looked different, you know, with some additional funding to help support them or could look different in a subsequent year. And so, just having that kind of year cycle could also be helpful of they have a full

12 months to use the dollars. What's what's weird in that case is then we will have to if we don't make it a calendar year then we will have to um move those dollars over in a budget through a carryover through a carryover process which would be somewhat unnecessary we align our our years up just my two you know some something to think about

and then mention about the the funding of course um this is our first year of the pilot program this is we're going to work out some kinks and see what the interest is we didn't know what interest there would be out there But coincign too is setting the budget for each year that happens in the fall going to December 31st. So then you have that timing as well. So um yeah, we can take a look at the schedule and cycle, but as as uh Shan said, we can look at it on a funding cycle year versus a calendar year too. There there's ways we can work with that. There's a quick question. So the ones that have the events that have already happened that that they're recommending funding for, we'd be funding for next year. Do we know they're doing the event again next year? Yes, they are. Okay.

For any of the activities that haven't or the events that haven't happened yet, is there any of them that wouldn't happen if we don't approve funding? I actually didn't ask that question. I can follow up and ask them, but I I didn't want to put ourselves in that position, but I could ask. Yeah. Yeah. Thank you. That's a very good question. Yeah. And I think council member just want to point out um one of the data points that we did collect is what was the total budget and what you will see is that um a lot of the organizations are asking for most of or close to the total budget and so I think um again the programming probably looks much more extensive and expansive with city funding.

Awesome. Thank you. That makes sense. Yeah. So, it looks like there's a um a mix of activities and programs that are um culturally tied to demographic and then there's some that are tied to practices. Um so, this is more of a statement unless you have a thought about this. I I'm always curious about how we can surface some of the hidden cultures in our community. Um I I don't know the answer to that and certainly you don't have to have a grant from the city to you know have some events or uh celebrate a culture but I I'm always curious about some of the hidden how how we can surface some of these hidden cultures that I know are here.

Yeah. I what I think what's going to happen is this is our first year. the word's gonna get out that there's funding available for cultural um events in our community and you're going to start having people start thinking about this a little bit more and say, "Well, geez, we've always wanted to do this, but we haven't had the funding, you know, the ability to do it. Uh, city of Lacy has this grant program. Now we now we might be able to do it." You know, for example, I've been talking for I don't know how many years about doing uh um this idea of this diversity cooks um idea where uh several different cultures would prepare a meal that we would share for, you know, an evening. Um and it's something I've been

been wanting to do for a long long long time. Um, but you know, we just we need an organization to step up and be able to pull it off, right? And I I think this is a

I think we might be able to figure this out if we if we talk to, you know, there's several cultures right in here that could cook a meal and do that if they had the funding to do it. Um, and we could we could figure it out. And so I think what's going to happen is this is be going to be pretty popular. we're going to start seeing more and more um requests and then we need to make a decision um you know the cultural value of this and and and and be able to fund it and what does that mean to our community and do we want to expand um the grant program? Um and so I think this is a great first step. I think there's again some lessons learned here that um we can take away and I think as the word gets out um we're going to see more and more of these uh you know these community and cultural events uh happen and and I think that's a good thing.

The other thing I noticed is that many of them would have probably happened in another city but they were moving them here because of the grant. So that also served that purpose. Yeah. I had a couple of comments. Go ahead. Um I see a couple of them on here who actually applied for ELTAC funding in the last cycle um and received zero or reduced amount of funding in lie of this potential um funding that would come from here because part of it's because these dollars are easier to spend um and require less tracking and barely zero admin. Um, one of them was Holy Youth and the other one's Polyfast. Mhm.

And so, uh, and then, um, I saw the Christlike Aggro thing that they gave a really extensive that was a lot in there, uh, for those guys. Um, and then, uh, city manager already answered my question about events that have already been held. Are we, you know, reimbursing them? Are we funding them in the next cycle? And apparently, it's the next cycle. Exactly. Um, but one thing I didn't I couldn't blow this thing up big enough to to see like which eight are we talking about. Sure. The ones that are in blue. Okay. So, it tells you the ones that are that are not highlighted have zero funding. Yeah. I was looking for that and it was

short of time. Okay. Yeah. just to to here in a bigger for anybody who may be watching it's in table um a it shows kind of the full funding and also on attachment uh two it provides it on the uh right left hand side it is the I knew I must have been missing it I was like oh attachment two there's two pages there's okay first page and second page also page three and four of the staff report okay oh which is makes it pretty easy to see there.

Well, while you're looking, I just want to say I'm so excited that this money is going out the door to support this. I think it's great and, you know, while while we have some, you know, finetuning, I guess, to do, it's just I'm really proud of us and you. And then um I saw the Holy Youth their their event wasn't in Lacy was or was it in Lacy? It looked like they were all in Lacy. They all met the criteria of being in Lacy or the urban growth area. Okay. They weren't funded because they're community only. It's not community and cultural if you look at

the way they did it. Sure. So, um, like I I think what we're coming back to is is is what are we going to recommend, um, well, going forward, right, for the that's come before us for Well, yeah. The purpose of tonight is really to get the information in front of council, ask, you know, council have opportunity to ask questions, get some clarification. And if council's ready to move this forward to a council meeting for action, we'll schedule it for the next available council meeting for for action by council. Okay. I have one last question. For the events that already happened, did they come back and give us actual numbers? We could follow up and ask them for for that. Yeah,

I'm not saying you should. I don't want to put any more work on your plate, but it will give us a good uh um yeah, foundation basine. Yeah, basine. Can I just add that we can ask them and there'll likely be estimates since they weren't required to, you know, try to calculate how many folks exactly were coming, but we can certainly follow up and see if we can get some more information. Yeah, maybe they know how many people actually showed. That's the one thing that kind of caught me was there's pretty dramatic differences in the number of people for the funding, right? So, I mean, $5,000 on one event is 750 people and another event it's 80 people. So, pretty pretty dramatic differences. was this and how far that money is going for, you know, as far as how big a spread people are being affected

and was that taken into account, right? I mean, we I want to be supportive of community and cultural events, and I think this is all great, but we should also try to have, you know, the biggest bang for, you know, it should try to reach a a a decent amount of people because like as you point out, you know, if 80 people show up divide by 5,000, it's a way different than 750 or,000

polyfest with 5,000 people. And so if if I think that um I think that needs to be uh one of the data points. I don't necessarily say it has to be the data point because you could throw an event that gets started and then grows exponentially the the next year. There could also be other funding which like Polyfest is not funding. I mean they're not doing 5,000 people with this 5,000. They obviously have other funding because, you know, you're not doing it for a dollar ahead.

I think that was and I think that was some of the approach of, hey, this is the pilot program. This is the first time. Let's see what applicants are out there. Let's see what, you know, might be able to grow over time. And some of these events haven't happened yet before. As Veronica mentioned, you know, I'll use the Holly Festival. And I think when we're looking at the estimates, it could also be they they just don't know because they haven't done it before. And so continuing to start it, have that seed funding and then build the program that could change those estimates over the next couple of years.

And that was that was one of the original premises of the council is trying to figure out a place where you can create these new opportunity for events as a grassroots effort providing some seed money so they can start building some momentum and see what could happen out of it. And kind of the challenge of some of our more formal funding is really based on metrics. This is an opportunity to basically provide that seed money to create these community events. And some of these events could, you know, be great and grow over time and become, you know, as big as Polyfest. Who knows? But I mean, I think we should, my personal preference would be to go with the recommendation of the equity commission. Yeah. Just move it along that way.

I think we all all agree there. I think um again um we can have some further discussion when it comes to budget, you know, budget time about, you know, when you know, do we up this so on so forth. It can be a a conversation we have. We'll hopefully by then have tight budget times remember mayor.

Yeah, understandable. You know you the thing is is I say this all the time you know we we have to learn how to walk and you know chew gum at the same time. you know, we have to make good fiscal decisions and also support our community. And, you know, it's that's it's always a um worth the conversation to have, you know, um because I I think, you know, our our community and cultural events and the a lot of things that happen in our community is what helps create our community. you know, it creates a sense of, you know, who we are and um it should be celebrated and can then lead not only to further economic development, but you know, um a a tighter-knit community um where there's a lot of benefits that happen when neighbors meet neighbors and and and learn um from each other. So, um that benefit is a is a really big benefit in my opinion. So, I think lessons learned. Let's go forward with uh um

one other question. Okay. Um what are the plans for hearing from people once the event takes place? Do they come back and tell you, "Oh, this made all the difference or do they give you a report or?" So, one of the things we've done with the human services grant program, just as an example, is we've been following up and getting some testimonials on like how the funding was used and what the benefit was. We'd be certainly looking to do something similar with this program. That'd be great. And for especially if we fund any of these events, then are we going to do um some promoting of the events too, push out social media, so on so forth.

Yep. We're going to work to help um get information out to the community on the events. So um I'm glad we were able to do this and I don't know where to give credit for this because I don't remember who thought of this idea. Um, but these dollars are going to be a whole lot easier to spend for the community than the RCWm mandated, you know, ELTAC dollars and, uh, different stuff that's out there. Um, are you are you thinking maybe you would design a rubric for this um, if if we if we continue on for a couple years? No,

I think we want to see how this first year goes and be able to evaluate from there like um, the mayor was saying, and learn some lessons. I do want to highlight that this program was one of the things that was identified in the diversity, equity, inclusion, and belonging strategic plan. Okay. And so that came from community feedback that came from council feedback. And so we are continuing to implement that strategic plan. Okay. Thank you.

And like I said, this is a brand new brand new program. Um, even since we've just sort of discussed it, uh, there's been organizations and people have reached out say, "Hey, I want to do this event." And before we we had nothing to turn to. I mean, ELTAC dollars didn't always make sense from a cultural event standpoint, right? And so, um, so, but now we we do have something we can turn to and and help support, um, these type of events in our community. And I I like I said, I I think the result of this is that we're going to have a lot more people interested in and doing cultural events and community events here in our community. Um, and so, you know, we might see this um, expand in the future. And I think that I think that's a good thing.

I think we're off to a good start. Yeah. I just want to say that I'm just sad that I missed out on some of these events already because they all sounded wonderful and I just found out about them. So hopefully I'll be able to go to them and see them next year. Yeah, we'll definitely I I didn't see anything about Junth in there. Has that just gone away or or they just not asking us for help or We uh did not apply for any of the um funding opportunities that the city has. I believe the event is still ongoing. Okay, good. rack at the rack. I think that's an event that got really big really quick and so overwhelming. It got a little overwhelming and they're like, whoa, you know, and so

they wanted less city involvement because it got too big too fast. Yeah. So, but they're you still you still have to have organizational support to be able to put these things on. I you know that's a it was great to see you know how popular it became and how quick that happened. And I I feel a little heartbroken that we weren't able to um continue to support that, but uh again, you have to the organization's the one that's doing all the work. They're going to have to, you know, uh be able to put this together. So, still a full barbecue. Oh jeez. Yeah. And it was great. Yeah. A lot of work. I would just highlight tiger by the tail.

I would just highlight too to that point of, you know, this program allows the organizations to determine and grow at the rate that makes sense for their organizations. And so that's why we we're thinking about this as maybe a more sustainable path forward for organizations to design community and cultural events in the city. Excellent point. Yeah. Okay. Well, I think we got a plan then. Great. Thank you.

So, next up on our agenda is our uh TBD uh briefing or transportation benefit district briefing. Well, hey, I'm I'll start out and just say it takes a village. So Rick and Aubrey and Don and I are going to tag team this. So with that, I'm going to turn it over to Aubrey.

Good evening. Going to try really hard to make it through this, but I'm suffering from tree allergies right now. So it's Boy, the it's so bad. I mean, I wasn't really happy to see the the rain come, but man, for a couple days there, it was it was really bad. So much pollen on every car out there and everything out there. for sure.

Okay. Um I'm Aubrey Collier, your city engineer. I'm here um to talk to you again about the uh renewal of the transportation benefit district. Uh so for an agenda tonight uh we're going to discuss near-term um decisions that we need to make um such as you know the renewal election date. Um I'm also going to go over some sidewalk capital projects and planning um as well as uh revenue sources or strategy going forward. Uh we're also going to discuss the TBD ballot measure language and uh the communications plan going forward. So the near-term decisions the the number one uh most important decision is election date whether we want to go to the November um 2026 versus the February 2027 uh special election. And the second decision um would be what the ballot language would say. So obviously the sooner the election date, the sooner we need to make that decision on the ballot language. Uh so regarding TBD renewal schedule options, uh we have the November versus February options on here. The November option is the cheaper option. Um and it also um some of the considerations is that there will be more initiatives, candidate races, more ballot measures on that um potentially other um items to to compete with uh people's attention. The February election would be a higher cost. Um that

is the cycle that aligns with the 10-year renewal cycle. So the original was done in February of 2017. Um, this would allow us more time uh for public outreach to provide, you know, information to the public on what we have spent um their money on over the last 10 years. Um, and per um some comments that we received from council at the last meeting, we did uh discuss with Lacy Fire District 3, they are tenatively planning to go to the November um election. So, it is city staff's recommendation to go to the February 2027. You want questions as you go or at the end.

Um, as we go is fine. Um, we have time for discussion at the end, but if whichever you prefer. Amazing. Let's Yeah, as we go works. Yeah. Uh, I I know that the the question you're going to ask is is there a qualification for that? Correct. Right. That's And this is uh and Rick Bennett was looking into that. I don't know if he got answered. So, we we can we can explain that. And I was I was trying to remember back when we passed this originally was that a concern and for some reason I don't remember it being a concern. So we we did some research and and

yeah so the the state constitution the only reference to needing uh you know at a special election of 40% minimum percentage of the previous general election is related to property tax levies. can't find anything related to sales tax and um you know and then phone call to thirst county they also verbally told us you know that yes that there is not a percentage but it wasn't an issue in 2017 then okay good and it's still not an issue yeah still not an issue yeah that's only

that always concerns me because you know we're I anticipate November being a very large turnout and I don't know that we'll get 40% of that in February to be honest Great. Uh so the the second discussion point will be the TBD ballot measure whether or not we want to use the uh 2017 ballot language which limits work to repair and maintenance of existing city streets and sidewalks or if uh council would like to change the language to also include allowed use for constructing new sidewalks. Uh so some of the considerations there uh the current funding needed to maintain road conditions and replace existing damaged sidewalks is approximately $4.7 million per year. And in general that increases every year just due to aging infrastructure. Um from a staff perspective, um our preference is to prioritize maintaining existing infrastructure before constructing um new infrastructure. Uh what I just wanted to provide you with this graphic here is showing basically three different funding options and how that would impact our street conditions and our deferred maintenance. So um I know it's small and probably hard to read, but the the uh blue line represents um us spending approximately $1.25 25 million per year on um city street repair and maintenance and then spending so so it's approximately $4 million per year that we get from the

TBD. So spending 1.25 million on street maintenance um 75 million on sidewalk maintenance and then the remaining two million on new sidewalks. Um that's what that blue line represents. The orange line represents what we are currently um doing with the existing TBD money, which is spending about 3.25 million per year on street maintenance and 3/4 of a million per year on uh sidewalk maintenance. And the gray line represents if we had if we spend 100% of the money that we're currently getting on street maintenance. And so you can see even even if we were spending a 100% of the money on street maintenance um that's still not quite enough to keep up with um the needs that we have to keep our streets in the current condition that they are. Um and then the graph on the right is a similar type graph, but this just shows what that deferred maintenance is. meaning those streets that we would have to completely reconstruct rather than um doing a lesser maintenance on them such as a grind and overlay or a slurry seal or crack seal.

So yeah, we just wanted to demonstrate the map on the right there. It says sidewalk projects, but those are large grant-f funed capital projects. So we just wanted to demonstrate that large grant-f funed capital projects are not all about cars and vehicles. So if you see the on this map, the blue shows projects that have been completed over the years and the you know yellowish is uh our future projects. But I want to show before and after pictures of three different projects. The first one here to the left is Mullen Road, which as you know feeds both Timberline High School and Lakes Elementary. You can see that the the pre-ro photo there on the right. There were no sidewalks. you know, kids either had to walk on the shoulder of the road or, you know, or in a in a ditch on the side, you know, now it's uh, you know, two lanes, bike lanes, street lighting, sidewalks. So, here, two more projects. Now, College 22nd, obviously that feeds Mountain View Elementary, and there were sidewalks, but you know, there were there were four narrow lanes and a narrow sidewalk,

and you felt every car that went by when you were on those sidewalks. Yeah. If if I could zoom in there, if your eyes are pretty good, you can see the upper left photo. There's a a pedestrian walking and you can see he's kind of straddling the grass line. And then before is with the improvement where there are 10 foot wide sidewalks that are separated comfortably from the street. Uh on the right is the Carpenter Road project from uh Pacific Avenue to Carpenter and that photos at Lake Lois. there. Again, there weren't any sidewalks in that stretch. Yeah, I remember canvasing some of those areas. Oh, yeah.

So, you know, the the point being is that for our big grant, you know, funded transportation projects, typically we're improving everything and and so it's truly multimodal. It's pedestrian, it's bike, it's, you know, uh for vehicular as well. Um so just wanted to show you a couple maps in the previous bicycle pedestrian plan. Uh the map on the left shows segments and the map on the right shows spot projects. Uh segments typically are going to be improvements that are going to occur with a large grant-f funed fully, you know, full transportation project. The spot projects that are shown on the right uh are mainly crossings. There's about 22 dots there that are either bicycle or bike and ped and 15 of the 22 are crossings and then there are a couple of wayf finding and then there are I think four that are designated as other that are kind of a a hodgepodge. So our commitment we're going to be updating this plan in 2028. Um, and you know, our commitment is in terms of GIS and mapping is to capture the map of, you know, all of our sidewalk gaps that exist in the city. Uh, so I just wanted to to go over um first of all kind of a project selection criteria when we're looking at um when we're looking at sidewalks um you know first understanding that we or when we're looking at larger projects even um that um we're we're typically trying to pick the projects that are going to have the biggest impact to the most amount of of people. So, for example, you know, a project on an arterial street is probably going to, you know, rate higher

than a collector, you know, than than a residential as far as when we're trying to look at what projects um are going to take priority. Uh we also take into consideration, you know, location and safety. So, for example, something that might be near an essential facility, uh such as a school or, you know, some other medical facility, something like that. Those are kind of areas that we, you know, might um prioritize. Um we also might prioritize a project if there's an opportunity for funding that's outside of the city such as uh project partnering partnering. So some examples of that um where we've partnered with other um with private um entities are, you know, the Hawk Prairie roundabout where we widened that and improved the sidewalks there. And then also we did a project on uh Marvin Road widening um project just north of the roundabout there. Um those are just two examples of projects where we look for that partnership with a private um developer to get some of those improvements done. And then uh we're always looking for grant opportunities um to find a project that might fit a grant opportunity that's out there and use our city dollars to leverage those funds to to be the matching funds for uh that grant opportunity. And um and that's how most of our our grants are. So um so as far as example projects, what I wanted to provide for you today is just um I I brought to you um example of 22nd Avenue last time. Um, and I wanted to provide some other examples of other types of projects that are that are out there that, you know, that do need to get done. Um, and that I brought three different types of projects to you as an example. Um, one's going to be 50th Avenue, which is the I believe that missing link project is is um, sort of what you guys were

interested in seeing um, last time. Um, I'm also going to give you an example of a project that's um more of a school or trail connection on 37th Avenue, which is um Mullen Road between um Kamachin and uh the Shahilis Western Trail and then Golf Club Road, which is more of a retail connection um just south of that roundabout there. And so I mean you will see costs up here and and what I wanted to explain here is the costs that I have shown are again the costs that I explained last time for like a full roadway section to meet our standards. Um and I do recognize that there was some concerns last time about whether or not that that full roadway um improvement was really necessary. Um, I provided these full cost because that's currently what our standard is. Um, but I did want to mention that, you know, if the city is interested in looking at, um, a lesser standard that might be applicable in, you know, certain circumstances or situations. That is certainly something that we can look into, but that would have to go through our typical process, which would mean going to, you know, the planning commission and we'd have to determine what is that what does that section look like? Um what what is it what is okay to take out of that section and what situations is it applicable for? So that's if that's something the council's interested in, that is something that we can pursue, you know, in the future. Um,

we have to be really careful when we start going down that that road. Um, because in my eyes anyway, if we're going to do that on a city project, we have to be mindful of the private sector and we shouldn't be lowering the standards for what we're doing if we're not lowering those standards for them as well. They shouldn't be held to a higher standard than we are. We've had this discussion on other topics over the years. You may recall we had pretty heated debate on this one over signage as an example when the city wanted to put in readerboard signs yet we didn't allow the private sector to do it. To me that was ludicrous and you know luckily we changed our sign ordinance but we should not we should be held at least to the same standard as the private sector.

Well I think that takes a a a bigger conversation. Um, and you're right, you have to be careful, but I think where the conversation needs to go to is is uh safety should be the first priority, right? And and if we're faced with a situation where you make it so expensive that it will never be done or you you develop a a process of a intermediate uh temporary solution due to the safety concerns of an area. That's a conversation I want to have with this council, right? because what we're doing now is broken and what I'm looking for are solutions. And so, um, that's why we're going through this, right? You know, we're going through this this process. Uh, I know when he we we, you know, when we get through this a little bit more that we're going to come up with a a a possible funding recommen recommendation outside of uh using transportation benefit district dollars. I'm open to hear that. But um the argument of it's never worked and I'm going to continue to do something that's not working um is not a good argument for me when it comes to people's safety. Um period. And so if we need to have that discussion, I'm happy to have openly have that discussion with this council on what is a a an alternative that makes more sense.

Well, and that's part of the this conversation. I can't make those specific. We don't have all the factors, but it goes through a process. It goes through a vetting. We have it go through the planning commission. There'll be some community engagement, some public hearings, and then options come back to council if the council wanted to add that to a work program um to amend the standards for certain certain circumstances and situations. But I think the message is is is doing that without going that process, we can't be in an arbitrary situation. So, it'd be a future conversation of council in terms of adding to the work program um to get to that point in time, but in the meantime, it gives us time to figure out where those high priority areas are.

Go ahead. What is it about our current standards that don't meet safety recommendations? Or am I missing something? our current yeah our current our current standards meet all the safety recommendations. Uh what I was referring to is um at the at the last meeting um mayor had some questions on whether or not that full standard was really required meaning do we have to have um street lighting and street trees and the planter strip and do we have to do full roadway improvements and and currently our standard is that we would improve both sides of the road for example.

Oh I see. And so and so what the concern would be is if um if if we want to do something lesser than our standard that would have to go through a process to make sure that um we have clearly defined what that new standard is going to be and when it's appropriate to use it because we wouldn't want to do a lesser standard for us um just as um as council member um Greenstein said and then allow something different for for developer. Uh so so this would be um this is this is the only example I could find um looking through of like a missing link project that we had identified. And so I wanted to bring this forward um to to show you the example of a kind of project um that I believe that you were looking for. And so this is uh 50th Avenue Southeast, which is between uh Ruddle Road and um uh Summerwalk is kind of off to the um west and just north of this is where um Reineer Vista Park is. And so this would be an example um where uh it's hard to see in some of these photos, but for example um on the upper right hand photo um there is a little paved area in the grass in front of um you know that house, but you can see like on the on the right side of the road um that there is a fence there. And so um there's areas like this that you know that current sidewalk does not meet our current city standard. if we were to add, you know, some of the sidewalk in some of these missing areas, um it it uh it wouldn't meet our city standard to just continue that sidewalk

along, for example. Um but to do the full city standard would involve, you know, most of those fences would be in the way of putting a sidewalk in where it meets our our current standard. So there's um there's some complications there that we would have to work through before we could do a project like this. Um um this is an example of um trail to school connection. So there's Kamachin on the right hand side all the way over to Western Chahalis Trail. And so this is an area that um along the south side there are some sidewalks along there, but there's not a continuous length of sidewalk all the way along the stretch on both sides of the road. So people across the street in that in the neighborhood to the north there have to cross the street down to the south to get on the sidewalk and even then that sidewalk doesn't extend the full length. So, this would be another um project um that's, you know, it's in it's in our our future list of projects that we would like to do. But um and then here's just an example of Golf Club Road, which is just um south of the Pacific Lacy roundabout. um just an example of a project that would be a good connection um from you know business area um down into a residential area and then as you know 14th goes over to Western Chalis Trail um make some connections there. So, and so as as far as strategy goes, I um what I heard from you at the last meeting was um that we'd like to look

into what other strategies there are to fund uh projects. Um our our main strategy has been for small sidewalk gap type projects to use arterial street funds and um and so a lot of times we will we will partner projects and so a good example of that that I'm going to show you in the next slide here is the um Pacific Home and Roundabout where that was a TBD project where we were paving the roundabout but we happen to see that, hey, there's a little section of missing sidewalk right next to this. We're going to go ahead and use arterial street funds to replace this, you know, this sidewalk gap here. Um, and that would be our commitment and our strategy continuing going forward is to continue doing that. um as we are doing our TBD projects to also be continue to look at those kind of gaps. If if we're paving a road in an area, is there an opportunity to do a small section of sidewalk where there might be some missing um that fits into that same project limits? Um and so that has been our strategy and that would continue to be our commitment going forward is to make sure that we are looking actively looking for those opportunities um to to do that type of work. Um another strategy that that we use is grant funding. So, um, most of the grants that are available are for much larger projects, but the types of projects that typically, um, do really well for grant funding are projects that in that are multimodal that include, you know, sidewalks, crossings, projects that are near schools. And so, a good example is um on the college corridor, the college and 22nd roundabout. We received grant funding for that. Um, we

also received grant funding for um the college and 16th and college and 29th roundabout designs. And then um we recently I didn't put it on here, but we also received a grant for um Rainineer Road um just south of Yelm Highway. There's that uh stretch of road along there where there's no sidewalk um near the golf course. And so we did receive a grant to do improvements to that road and add a sidewalk there. And so those are always projects that we are, you know, we're looking for grants to to improve not just the roadway but to also, you know, um provide sidewalks and um and then um Scott, did you want to talk about

Yeah. So I want to talk about residential neighborhoods that don't have sidewalks. So, no cities in the state go out and build and pay for new sidewalks in residential neighborhoods that don't have them simply because they can't afford to. And so, the tool that's used for that is the local improvement district where they go out and they petition and they get more than 50% support from the neighbors to do that. And then if that support remains through the process then just like our utility local improvement districts those people are assessed you know for the design and construction of those. Actually we have it pretty easy here in that um you know we do have a number of neighborhoods that don't have sidewalks but you know like Spokane has over 40 miles of gravel roadway with no sidewalks in residential areas. And that's because, you know, Spokane and Tacoma and Seattle are much much older cities. So way back, you know, that was an acceptable standard. Um, so I can tell you because I did run the local improvement district team in Spokane when it came to lowincome neighborhoods that qualified for a community development block grant monies that that there was a tiered approach and CDPG monies did subsidize the assessment for lowincome people in qualifying low-income neighborhoods, but no general fund money was spent on those because city couldn't afford that um and uh so that was a tool you know where depending on a you know they'd have to submit income tax data and and and that and if a person was you know say sole source of income was social security there's a good chance that 100% of their assessment would be paid by CBDG dollars that was an available tool but the

reality is for residential neighborhoods there's typically not grants to build sidewalks uh because well for a number of reasons. So I just wanted to make a couple points about local improvement districts but that is the main tool. Tacoma does have the oldest local improvement district program in the state and they probably form more local improvement districts than any other city in the state but it's a viable tool. That's what they use. Just wanted to make you aware of it. And so kind of going back to what Aubrey mentioned at the very start of the presentation. Yeah. Staff's recommendation is that 100% of the funds revenue generated by transportation benefit district go to rehabilitation of pavement and sidewalks because of the information that was shared. um the more money we pull out of that pot for capital, the more the the condition of the roads and the sidewalks will decline and that's almost impossible to recover from. So our commitment is to you know somewhat like if if there are gaps to be filled look for these other sources of funds apply for grants if it's a grant eligible eligible area um and and pursue funds that would allow us to fill in some of these gaps to schools to retail areas and that through other sources of funding. I I really get what you're saying about your your preferences for what we should do with this. Um, I'm concerned that we need some flexibility like if if there's a hazard situation that's called to our attention or just safety in general on sidewalks, if not the TBD money, what other sources is there for that? And

that they can't wait on a grant kind of thing. And I'd like us I'd like to see us look for those opportunities and make a commitment to doing that because it's going to get budget season before long. and we're going to, you know, there's going to be a lot of competition for shrinking pot of money. So, yeah, I in terms of I guess we need to understand what's meant by safety hazards. Um, you know, take Stilicum Road, you know, Thirsten County did have a grant for that out near Stilicum Middle School. The grant had to be turned back because the project couldn't be built because of pocket gopher at the time and and all the permitting,

right? But as you all know, there's kind of like Mullen Road used to just have the goat trail along the side of the road and then we fully improve that. That is the ultimate plan for Stilicum, but city can't afford to do that, you know, without grant funding. Uh, you know, we have these 18,000 offsets around the city. You know, we can't afford to fix all that at one time. But but that is being done with TBD money because that is repair. Yeah, that's a portion of TBD and that's a growing need.

Uh so yeah, if I mean if there are things that are truly unsafe, then we want to address those, but it kind of depends on the what it specifically is. and and and part of that commitment in looking at these projects because um as we identified in the pedestrian bicycle plan, most of our sidewalk gaps or those longer segments which have a lot more um cost associated with them

that as we look at those unique circumstances where we do have a critical gap that maybe have some safety issues or a a key um pedestrian connect uh attractor or something of that nature that we could look at that in concert with our overlay program. and the pole funds from our um general fund arterial street dollars to be able to do that sidewalk installation to close the gaps as Aubrey mentioned and and is used as an example at home and where they applied that in in the past. So I think when we look at our annual program, when we look at an overlay project, we'll look and assess if there are any critical gaps and then and bring in other dollars in to supplement that project and that' be tied through the budgetary process.

Right. Okay. So I I did also want to mention um oops sorry I was trying to find so this spot improvement recommendations. So, uh, we we have committed to working through these, um, spot recommendations with our arterial street funds. And so, um, I know it was really hard to see on this map because it's very small, but um, you'll see some orange dots on there. There's three on Rutle Road and there's one on Mullen. And so that's an example of those are all projects um you know from the from that spot map of you know of what we heard from the community that you know we need more so these are for enhanced pedestrian crossings um and so that is coming out of arterial streets and that's an example of how we you know we we don't have the the budget and arterial street funds to do these really large projects without grant assistance but we have committed to um chipping away every year at doing some of these smaller projects. Um and so currently we have four of these spot projects in a queue that we're um starting preliminary design on this year that so like this year that will look like survey and you know just identifying if there's any obstacles to putting those crossings in the locations that we have identified if we need right of way or or things like that um to hopefully start construction on some of them um next year and the year after. Um and and so we are and and um in the past um what the commitment has been is that we will spend you know no more than $500,000 a year on on those types of projects. And that's um what our plan was continuing is to you know have that

you know $500,000 per year set aside that we can spend on these smaller spot type projects. And as we go through with the update to this um you know the the bike and pled ped plan, we are definitely committed to trying to look for those areas that um you know if there's areas that are missing off this map that didn't get identified last time. But um but but that definitely is a commitment and and that is our strategy is to continue chipping away at those spot improvement projects um with arterial streets as we look for the grant funding for some of those larger projects. Um not sure if I talked about this or not. This was just the example on on uh the on home and road where we were able to identify this project and and fortunately in this case um we got this done for you know much cheaper than typical because it was already graded to you know the level we needed it to be and it was just a you know nice gravel flat area. Um and the other side of the street was already already had a sidewalk. So, so this was one that was um that we got done for um much cheaper than you know the typical would be the roadway section was already in good shape. And so this was just the example I wanted to provide of um the types of projects that we're looking to do along with our our TBD. So and now I'm gonna pass it over to Donna to talk about our fine.

Okay. So, I'm just going to give a really brief highle um overview of our comm's plan for the TBD. Obviously, it's still in draft form and um open to any questions or comments you have along the way. This right here is just um some key dates that would be depending on if we went in November or February. I know Aubrey I briefly mentioned this earlier just for your information. Oh, look at it myself. Um the draft plan um has several different components to it which would be just like the situation, what we're facing, the audienc's key messages, tactics, how we're going to get the word out, timeline and Q&A. So I just wanted to briefly go over some of the tactics that we have planned. Obviously this is still in draft form and open to suggestions. So one of our first things we would want to do is update our website. We do have a current page right now that has basically just the TBD reports from the last 10 years. So it it doesn't have a lot of information regarding an updated plan. So we would update that include um Q&A, FAQs, past projects, things like that. So people could have a great place to land and find information, factual information. We'll also have a social media campaign. It won't be a large campaign. Um we generally speaking will have to continue doing what we've been doing already um for any kind of outreach plan on our social media. Um we will have a large um number of community presentations which will be service organizations, boards and commissions staff, other community groups, things like that. Um we will also have information available at key um community events in throughout the time depending on when we go. And then of course we'll have anformational flyer which will be just factual information that will go out to our voters. And then we will also have um excuse me

information in our Lacy Life and our Lacy weekly um newsletters. So that's just kind of the brief um overview. Once you guys have selected a date we will you know finalize our comm's plan and we'll we can bring that back to you and we'll start implementing the tactics. So if you have any questions or comments, happy to take those. And the information though mailer will go to a cross-section of of uh Lacy residents or are you targeting or would you target a demographic? It would be all the Lacy voters. Yeah.

I can just add to that. When we did this in 2017, we did several of us, Andy and I in particular, went out to, you know, with staff to all kinds of events and spoke to different groups and, you know, did things at Panorama on their TV network and all kinds of things to get the word out because it was, you know, it was critical that we get it passed and the funding is just an absolute necessity. Obviously, we'll also have a video that will be available. What we did last time, I think, is we had one of the first presentations we we did. Um, we just had it recorded and then we had it available on our website so people if they weren't able to attend an event, they would have access to the same information.

Are there any plans to get a committee together, a citizens committee to promote this, do the things that the city itself can't in terms of advocacy? I mean, I think that's a discussion that needs to happen outside of our here obviously and and and um

you know, I yeah, I think that'll that'll that needs that's a political question and and um we'll have to figure that out as we go along. Believe it or not, last time when when we did the did this, we um it was several council members putting in quite a bit of work on an official capacity going around and and giving facts um and and then um then separately asking you know some other talking about the importance on other things and I you know we we can figure that out going forward. where you know we can split up uh some conversations that we go out to our community and and figure out amongst those

and I think that's the the biggest um um thing to remember is there going to be opportunities for and because last time there was I remember there a lot of effort from council members as well as staff going around and and providing that factual information and uh not campaign but just given information and that's that's the official capacity of the city. I'm not aware right now of any group out there or interested parties that would form something like that, but that's something that could happen out there in the community.

I would just add to that that for some of the newer council members who may or may not know, but staff of course can only go out and give factual information. They can't push one way or another that the piece that gets mailed has to be just factual. They can't encourage people to support it or not to support it. Right? But us as council members, as electeds, our role is is different. We can go out and ask for support and help you know people. We we can we can go out to sell it more than they can. They can only go out with facts. We do have a different role. So we just can't do it from the dis. Correct. Can't do it from here. It's got to be out on our own time, not on council time. And you know that's so we did quite a bit of that last.

Can we go back to um slide number three? Yeah, I think that was Yes, that was our last slide. So, so at this point, yeah, I would just like to open up to discussion and um you know, the like I said, the most important um topic that we need an answer on tonight. It go back one uh this one. That one? Yes. No, I'm sorry. Couple more is the schedule. So, this is um you go back one more. I think that the one you're looking at. Yeah. M. There we go. That's the one.

So again, the two decisions we need, um, election date and ballot language. Um, you know, my preference is that you decide on both tonight. But at a minimum, uh, what I do need from you tonight is the election date. Um, and then we can go from there. Um, if we have time to discuss the other side as well.

I'll throw my two cents in. Um, I think primarily because the fire district is definitely going out in November. I mean, I've had several conversations. I think that kind of kind of I wouldn't say it forces us, but I think we probably need to go February. I don't think we want to be on the same ballot as the fire district measure. There's going to be a big I mean, they're they're going out for quite a bit of bond money, so I I think we're better off going February, personally. Um, and my preference is certainly that we go with the same language. you know, when you change the language and you're asking for something new and different than you were before, it's much more it's I think it's a it's a much more difficult to get it passed. I just I just think if you stay with the same language, we're not asking for any new money. This is something we're already paying. It's just a continuation of of the levy. I think that's our best chance for success in passing. So, that would be my preference. So, I I definitely think we should go out in February since the fire district's going, you know, going out in November and um you know, that they're going out for, you know, a pretty big ass to to the public. It's a it's a it's a property tax and and not a sales tax like this. And so, I think um you know, they're going to it's a whole different scenario, but we we don't want to complicate the the two. Um and so like for example uh we we asked to pull some numbers um in in 200 um 16 during the the general election um you know they had 20,000 people cast their votes here in the city of Lacy out the 27,000 you know almost 28,000 registered voters and then the February um when we went out um that number um dropped all the way down to instead of

20,000 people voting we had uh 8,700 you know people vote. Now the the the question you know and this has been a long long you know debated is is what makes more sense you know having more people vote or doing a special election and having less people vote and then you know not sure which way it's going to go. Um, we made a decision 10 years ago that based on the information that we've seen in special elections, it seemed like the people who vote in special elections are uh happen to be more the educated voters. It's the one they vote every election, which means, you know, they're looking at the information. um you know they're they they they look you know they're just the more educated voter that you can sort of rely upon and in this case I think that is you know um says a lot because I think this has been a successful program and I think the educated voter in this circumstance would would see this and um you know uh you know make make good decisions based on that information. Uh, and so I also agree I think we should go out in in February. Um, especially since there's not a a minimum um a threshold that that needs to happen there. Um, you know, I'm a I'm a little sensitive on the the whole this whole sidewalk conversation. Uh I' I've made it perfectly clear over the years that uh we have a broken system um transportation system and how we've paid for it over the years where you know it's for the most part government uh covers uh you know roads and that part of the transportation network but doesn't cover sidewalks um or anything else. And that's can be

another um essential transportation network for a lot of people who desperately need it. Um you know, there were several of us that fought very hard 10 years ago to even have the sidewalk repair in here where it wasn't recommended at the time from staff. They didn't want sidewalk repair in this ballot measure at all. They wanted straight be pavement rehab. Um, and it took the political will of some members of this council said, "No, we want to make sure to expand it upon our our sidewalks." And then it took several funding cycles before we even saw that sidewalk money being used, the transportation benefit district being used to repair our sidewalks. So again, I'm I'm a little and it it basically had to come down from the pri prior deputy mayor and myself saying, "Hey, when are we going to see the sidewalks repairs and all the all this money that's being collected?" So that being said, I think this does take a a bigger conversation. It's a complicated issue. There's a reason why um it's been broken for a long time. uh there's not a dedicated revenue source and there has to be some prior prioritization that happens and I think it takes a it'll take a bigger discussion on on key segments that we know are have a safety related you know have safety connected to them and they haven't been be built what are some strategies to make it more safe in in some of these areas um that's going to require as I said a process to go through with with our planning commission and and it's conversations with our community and and trying to come up with some strategies on on

figuring that out. If there is a commitment to do that, right? This is something that we've been putting off putting off and putting if there's a commitment to looking at key key areas um and coming up with a strategy on how we make it safer uh and if that requires something with standard whatever I'm I'll go that direction and not push um to add you know sidewalk capital on on here even though I like the idea of having some flexibility um because it's the network just isn't being completed as is. Um, and we as a city didn't have the the luxury of Loft Cities who sort of built out from a center location out where the sidewalk sort of built out with the downtown, right? Uh, we are, you know, a a a conglomeration of a lot of different neighborhoods that haven't been connected over the years and it's It's really expensive to connect it at this point with sidewalks and bicycle lanes and so on forth. But in my mind, what that requires is a strategy is a plan to identify it, a plan to fund it, and uh you know, a commitment to do it. And so if if we can get that, then that's all I've cared about. Um but that's what I want to see. I want to see a plan. I want to see a commitment. and I want to see it done. Period. And if it's not with these dollars, it's with some other dedicated funding going forward. Um, that's what I want.

Um, on that note, I was wondering on slide five, you mentioned some of the considerations for the ballot measure um, uh, wording. Uh, I think the last bullet point says ballot measures for renewals without changes show higher success rate. I was wondering what type of numbers you were looking at like um just so I can have a little bit more of a concrete idea of what that success rate is looking like. Uh also I didn't know if we had any actual research or numbers on households without that don't own cars here. Uh like wrership on in uh from intercity transit within Lacy because people getting to and from bus stops require sidewalks to get there safely. Um, and so like these are just some of the other considerations that um, uh, I think having that the sidewalk capital part of the ballot measure could really benefit. Um, and I those are just some other things that I would like to have information on to be able to balance out the arguments for or against adding that aspect of the ballot measure.

I can answer just to the the ballot measure portion of it. just looked at some recent TBD renewals that went out. Um, for example, um, City of Tom Water just put theirs out and didn't make any changes to it and it and it did pass. Um, and um, there was one in city of Tacoma that they made changes to that did not pass. That doesn't necessarily mean it's not uh, it's not like hard data like it's guaranteed to pass if we don't make changes. It's just been my recent observation on on the last couple. Um I did do research going further back. I don't have all the data with me here tonight. Um

well, and when you I know I think it's a pretty broad like changes. Did did they change where they went from all repairs and maintenance to all the brand new capital or did they do a small tweak? I mean it's it's that's what's so difficult when you make a

that is it is difficult because you try to look for for trends and analysis but there are unique circumstances with every community and what they're putting on the ballot. Um you went back to the mayor's comment in terms of um a strategy and process for the prioritize some of these areas and develop a strategy to do some sidewalk improvements along with our normal capital and grant programs. Uh we will be finishing updating the transportation plan as and right off of that the pedestrian bicycle plan by updating the pedestrian bicycle plan that the current plan is our first f uh plan that's focused on pedestrian bicycles and you saw in there the outcomes of identifying those gaps and corridors as well as uh the spot improvements and as Aubrey uh mentioned the the spot improvements really looking at crossings trying to get across some of our streets and and creating reducing those barriers. When we update that, we can also take an inventory and do a finer grain inventory of where the might be those sideby gaps where there are key pedestrian generators and attract and pedestrian attractors, you know, your your your multif family complex or your your schools or your you know shopping or community centers and we can create a inventory and then prioritize where those u key gaps are to create a program and strategy that would come through the plan commission process, go through community engagement and come to the council for that that program. In the meantime, as we work on our annual capital programs with with transportation business, we will look for those various projects so that we can leverage our dollars, public dollars, and have them stretch further by, you know, pulling dollar from the arterial street fund into the project to be able to get more bang for our buck and fill those gaps we identify as we go forward until we get the longer term strategy happening. And that's something if the council's agreeable to that, we can we can um set that forward with and with that as the long-term while we're focusing on the the present needs of the renewal of the transportation benefit district

makes sense to me. Yeah, I could support that. There's two or three points. one um is equity in terms of you know environmental equity for poorer areas of town that may be lacking sidewalks and I think that's something we just need to keep in front of us there. Um, two on the election choice of dates. I don't necessarily disagree about February, but if if we don't put it on in Nove if we put it on in November and it failed, we could then run it again in February. um if it so I don't want to interrupt you but um so if you saw the schedule I just wanted to point out the schedule that she provided in that slide but if it didn't pass we would have to have the new resolution in November so that doesn't February have to go right so we wouldn't be able to go

this coming February we would have to push it to some later date I just wanted clarify that we could go back just we couldn't go back in February. So, so we by the time we have to have the resolution passed on submit to the audit for the February, we wouldn't have the current election votes tallied and finalized. It was like So, we'd have to wait till probably April or something of that nature. Yeah, but my my point being that we we would be having a gap in when the tax ends and when

the next election is and that gap would go out even further if we had it in February and it failed. Um, the other thing is I don't, you know, I I love the fire district and I don't want to do anything to hurt their chances of of getting their things passed, but let's say theirs passes in November. there's already gonna be voter fatigue, you know, and then that may bring some tax like, wait a minute, we just voted this big thing for the fire district and it might make people a little less willing to even though this isn't a new tax and I think renew has to be a big part of the messaging.

Yeah. Um it it could hurt us there too. I just I only mention these because it's you know it is I it's hard it's definitely more of an art than it is a science. It's it's really difficult to know when it's best to go out. Right. There are some advantages. A lot of people think to November and just the fact that the bigger turnout some some people think is a better alternative. I'm kind of in the agree with the mayor that I think you do get the more educated voter the more the voter who votes in every election. So they really know what they're voting and they study it more. I think that's true about the February, but yeah, I mean it's either one is valid for sure.

Yeah, I I Yeah, I in in this circumstance, I think um a huge voter turnout in November when we we won't have as much time to get the information out uh and there's already another epic quote unquote tax something on the ballot. I think it may hurt both chances of of you know both circum circumstances of getting getting passed and um I do think there is a big difference than renewing a sales tax. So this is no no you know it's

everything staying the same. It's you're not going out for an increase of of taxes to the community. Um I think that's a big difference than a new property tax, you know, or uh or even a new sales any any additional money is going to be more difficult. It's going to be really really hard and and I think you know

I you know now we're getting into strategy and I feel a little uncomfortable talking you know going in strategy but I I do think um there's sort of a a lot of angst in our community right now and I don't know how that angst will turn out you know what that means. I think you you fast forward to a a um special election um and again the people who vote are the people are an educated voter and I I think I feel a little more comfortable that even being farther away from a a a general election where um I think there is a lot of angst in the community. Um, I don't necessarily think that is the best time to put a a decision that is so critical to the, you know, to our our funding of uh such an important um, you know, uh, aspect of, you know, our community. Um, I don't want to leave that to chance. And so, um, I I I don't want to gloss over though that I do think the bigger conversation about these critical gaps still need to happen. I I just don't want to gloss over this. I like I said, I'm fine with us moving forward language as is as long as there is a commitment from this council to continue to have this conversation because it's not going to just fix itself. Um it hasn't fixed itself up till now. It won't fix itself in the future unless the unless there's a plan in place. And so and um and I don't want to for example you know in some of these missing links it it doesn't to me it doesn't make necessarily make sense in a residential community residential street

in a critical area for safety on a path to school to necessarily have to have a sidewalks on both sides of the streets. Right? it it that just doesn't make any sense from a financial standpoint, from you know a safety standpoint where uh you know one sidewalk on one side that's safe is way better than what they have right now. I mean, I think that's a conversation we should be having, not only, you know, amongst ourselves, but with our community and and through the the planning process that we have with our with our planning commission and to be able to identify that community. This is we're not the first community. We're there's communities all across everywhere that has been trying to figure out um how you fix some of these gaps, right? Lacy is not unique. Um, and there's examples from other communities where they have uh adopted some some strategies that I think we should take a look at um and have and have the conversations about that with. But again, I want to make sure we have a commitment to doing that, you know, going forward. If we can go forward, that's fine. Keep keep this the same. But I want a commitment that we are going to that this conversation is not just lost and that we we will come back to it and be a part of the work program.

I think you got that. Totally agree with that. Okay. Is that everyone agree with that? Yeah, I'm comfortable with that. Okay. Well, then I think we've figured out February and we'll we'll keep the ballot language the same. Okay. That's what I wanted to clarify. Is everyone agreeing with both of those things or I'm sorry. I I do agree with uh February for some of the reasons that uh we've already talked about. I really think that this could get lost. We don't know what's coming down the road and I think it can get lost if we waited and did it in a November election. So, I think it's important to go ahead and do it earlier. No, it could be later.

Later. Yes, later. Sorry. Um, and the other thing is I, you know, I', I've been sort of torn about whether or not to leave the language as it is on the ballot, but I I'm leaning more toward just keeping it as it is because I think um, residents in Lacy have tax fatigue

and they're more likely to pay for something to maintain it. they're more likely to want to not lose something they already have versus adding something else even though we need it. And and the reason I'm torn is because our community is more diverse than it was 10 years ago. Um and I think there's more of a demand for um having walkable communities.

Um less tolerance for congestion. Um there are a lot of reasons that that um I'm sort of torn but but let's just go with yes February and leave the language as it is and I am committed to continuing with the conversation. Um so I don't I don't have a problem with with February. I don't want to compete with um fire district on this um to get what we need. Um, and I like what you said about, you know, more educated voter in February. Um, I I know that the February voter is somebody who does not miss an election,

right? Uh, but I also know that they are an older demographic as well, more likely to use some of the things that we're proposing here tonight. Um, I also wanted to bring to our attention that, um, with a sales tax, uh, I think it's a little more beneficial to the community because we have a pretty large amount of daytime visitors who are also paying that, um, as opposed to just the residents of Lacy.

So, I see that as a benefit as well. Um I you know the language I'm I'm I'm I'm kind of torn on and I and I like staff's recommendation is that hey if you keep the language the same you get a higher likelihood of of it passing. Um but I didn't want it to be missed that you know we that some capital sidewalk capital could take place. I didn't want that to just evaporate and go away because I I' I like the idea of those neighborhoods without any sidewalks whatsoever having some hope that maybe they will get some sidewalks in the future. Um but I I'll stick with staff's recommendation um as long as I know that we can use some of these dollars for sidewalk capital in the future or we won't be able to use it at all. No, not

these dollars. We would have to use different dollars. Okay. So we just have to use the arterial street dollars period which come from re no gas tax. Oh just the gas tax dollars. REIT used to go into the arterial street funds and it now goes uh I believe last year council decided to have REIT go into its own separate fund to service the debt to be used for various capital projects. also prioritize some of that dollars in the future how we use it once we know what the strategy is for um sidewalk program. So So then the example I think it was um was it homeman or what what's the elementary school right here and we had talked about the improving both sides for $2 million that was 22

near Mountain View. So we wouldn't be able to use any of these dollars for for that at all. No, it is. Yeah. Strictly I think that's going to take a a a larger conversation and uh a a deeper dive into analyzing some of the information and coming up with a strategy to to do it and I we all all have that commitment to do that. And so going through the full process and going through a process and it's got to get public comment, you know, it's got to be it's got to be the full process.

Yeah. And so in many ways we're we're almost Yeah. we're a little ways out from even be able to implement some of that. So, um again, um like I I care about the plan, you know, as long as we can come up with a plan um and and implement a plan, then that's um better than what we got now. And so, it sounds like we have that commitment and um I look forward to that. So, so if we leave the language the same as it was last time, no capital, no capital. I see you.

Yeah, I just had a couple quick questions. Hopefully they're quick. Um, one is the do we have any examples of Lacy using the local improvement districts to actually build new sidewalks? And you mentioned that Tacoma uses them often for that and I wasn't sure if that was No, we've only done utility local improvement districts. We've never Okay. done a a street local improvement district since I've been here. Okay, cool. And then the uh my other question. Oh, I'm sorry. What? Going back I guess up up north. There was years ago as part of a development. U but yeah, there was but that Yeah, not you know. Yeah. So not for the purpose we're talking about like going into

existing residential neighborhoods that don't have sidewalks and using it for that purpose. Okay. And then the other question I had was, and this is might just be because I haven't done grant work, applying for grants, is having more capital available to us, does that make it more attractive to be able to help with getting grants in there or is it not having enough funds a a better look in terms of uh applying and getting grants?

So, so grants um the way So, we have to have funds. So, you know, in our arterial street fund, we have to have funds set aside for matching. So, there's rarely a grant we get that is 100% funded. The majority of grants we get, the city has to have a matching amount, some certain percentage that we have set aside. That's not something that is um it's not like they're looking at our financial records. It's more how does the project itself compete for the grant. So, if the grant is um putting a priority on, you know, safe routes to school or something like that, we're it's it's competing more in what the actual project is, but the city has to make that commitment that we have these funds set aside. So, you know, although we do have funding in our arterial street fund, um right now, I don't know the exact balance off the top of my head. It's probably 30 something million, but um there is, you know, there's portions of that money in there that that are from traffic mitigation that are required to be spent on certain projects that can't be spent however we want. Um and then there's other of those funds that are um committed if you will to projects um that we so for an example would be the college in 16th. So I mean if you added up all of the projects in our comp plan you know we don't have enough money in our arterial street fund to build all of those projects. Um and so what we do is we set aside that money to go okay we're going to um apply for grant funding to build the college and 16th uh roundabout and the college and 29th roundabout and we want to make sure that we're setting aside enough money in that arterial street fund so that when a grant is available that we have that money to be able to use as as matching um funds. Um and then you know we and

the council has you know made decisions in the past about m money that we want to spend out of art streets for other priorities such as the college and seventh roundabout is a project that um doesn't qualify for a grant. It doesn't meet the requirements as far as like safety or near school or anything like that like um college and 16th would qualify for. Um so that's but that's a project that the council previous council has identified as a high priority to you and so council determined that you know we would build a out of city funds at a city archial street funds the college and seventh roundabout. Um

the vast majority of street projects have grant funding. I mean you can't do these these projects are just huge amounts of money that the city could never do most of these big road projects without grants. Oh yeah. And I was just trying to make sure that like to highlight the importance of making sure we do have dedicated funding for sidewalks at some point so that way we can make sure we do these connection these connectors we are able to uh connect our neighborhoods. We're able to help people age in place by making it more walkable. And so like I just wanted to I I wanted to get that in my brain that I was like yes having dedicated funding helps us get grants because we can match. Um I'm not saying we need to put that in this particular ballot measure but it just to highlight the importance that we continue this conversation

you know and the strategy you're talking about. Yeah, that is part of the you know so once we have the strategy then we'll have the implementation process of how we set up our our our our capital dollars to

and this is what's so sort of tough about this timing is is I know that it's going to take a little bit of process for us to get there to have this conversation to identify to figure out to talk about standard all all those things that we need to do. Um but once we get to that point and then we start identifying say safe you know safe routes to school grant you know start identifying grants we don't have then the opportunity to even come up with a match to do those grants if we're not if we don't have a dedicated funding source from any place and and and that's why I said from the get-go that it seemed to me to make sense to include the language just so you have the opportunities in the future. Not saying that you're going to do it right this second, but that in the future you can make strategic decisions um if they come about on on going after grants or or doing some, you know, key segments. But without a dedicated funding source, I I don't know how we get there from here.

We do have other funding sources though. We do have the the arterial street fund. We do have I know the REIT we've put into a separate fund and we're using some of that for debt to cover debt. We're not using all of it to cover debt. There's still money there that is four streets, right? It would all go as part of that process that we need to go through. But I I mean I just don't think this money would make sense to I mean it would be no different than adding in using this money for capital and roads, right? The reason it was done as

maintenance is first priority before you build anything new is you have to maintain the infrastructure you have right it's no different than at your home you have to maintain you build a home you have to maintain that home before you go build another home you have to have the money to replace the roof when it needs to be replaced if we don't leave this money strictly for maintenance there's not enough money in this fund to do both maintenance and new capital there just isn't it just doesn't stretch that far

yeah I I've this is so critical cuz we need to maintain a transportation network and it's cheaper to maintain roads and sidewalks than to build it. I get all that. Where I keep coming back to is we're still missing a key part of the transportation network which is our which is critical sidewalk connections. And if we right and so and we still don't have a dedicated funding source to to meet that and that's what's so tough because we should look at as a a complete transportation network and we should do our best to maintain and make sure that network is available and accessible. Um but if we just le end that transport if we're all we're focusing is that transportation network on the road um then we'll that's how we got here in the first place but

and and just add this kind of to maybe conclude like I'm hearing that there's there's support for the February ballot. I'm hearing that there is support for keeping the ball language the same as long as we start working on a strategy for um new sidewalks. And part of that's going through and developing update in the pedestrian bike plan. And uh and one of the challenges and this is this is um um um I mean it is it's it's trying to find funding sources to do all these different things. But also I want to just say since I've been working here at the city of Lacy, there's been a lot of of major road projects over the years that the Lacy have been able to accomplish. I don't think all communities have the opportunity to do all these different road projects. And as we've been building these road projects, of course, they're the full the full enchilada, right? They're the drive lanes, they're the medians, there are the bike lanes, there the lights, and the sidewalks. And we've made a lot of key pedestrian connections as we replace our current road into more urban type as we've grown as a community. In addition to that, of course, we've had the new development occur over time, the building newer parts. We're continually having to maintain those newer roads being built. But we will can look at the ped bike plan updates. We will look at the transportation updates. We'll identify where are those other key gaps and the smaller gaps that we can leverage. But we still have to look at these larger corridors through grant projects because they just get to be a big dollar amount that even the TBD dollars would not cover that that cost in one year. So again, I I just want to encapsulate that we have been working on these and and we can have more focus on those minor key gaps that the pet bike fund focuses on going forward.

So So we don't have a funding source for sidewalk capital, right? If we have I if we did so like the college and 22nd project that we mentioned that would probably qualify for safe routes to school funds. We'd pull the matching money out of the gas tax portion of the arterial street fund. There used to be three sources for the arterial street fund. There was developer traffic mitigation fees. Those are tied to specific projects. So, you just can't pull that money and use it wherever you want. Gas tax you can pull and use as long as it's transportation related.

Um, and then there used to be the REIT, but we've already had that conversation. So um now we have one to so the removing residential neighborhoods from this conversation. Yeah. The kind of what would be the more priority routes, safe routes to school and that would yeah those kind of things do qualify for grants and the arterial street fund would be the source of matching money for that. But we we've seen the gas tax dollars decrease year after year, right? I mean,

and and there there's a couple sources that go into the RGO streets, but also again going back to Aubrey's comment is we are already using some of those funds to identify those spot projects. So, we do have funding for as we identify those higher priority needs and fixes. Very similar to what we're doing with the sidewalk rehabilitation process. identified the inventory all the sidewalks where those big gaps are start focusing on the worst scenarios first and then yearly per you know solely work at the effort over time and have a strategy in place we're talking about something not very much different than that type of program and setting that program going Can I just simplify this real quick

if we add this sidewalk capital language we have a signing a funding source that we don't have now even though it would run dry before we got to it but the fear is is that if we at it. We won't pass. Well, and it's not really a funding source. There's not enough money. I know there's not enough money if there's no money there.

So, yes. So, that is one concern that I have that making any changes to it could reduce the chances of it getting passed. Uh but my bigger concern is that we do not even if we spent 100% of it on maintenance, it's not enough money to maintain our current network. and that uh staff feels that it is a better strategy to continue what we have been doing as far as leveraging the money in our arterial streets funds to try to get grant funding to pay for some of these bigger projects. And I just want to assure council that um it has always been um very important to us pedestrian safety and pedestrian connections and that when we're looking at roadway sections, we are not just concerned about the roadway, you know, users. We are very concerned about pedestrians. And I didn't go through every single project that's on that map, but you know, over the years, the city has built a lot of sidewalk connections. You know, um Lebanon Street, Gulf Club, Hogan Bay, um College Extension that we just finished. Um we've been very successful in leveraging our arterial street funds to build sidewalks, not just roadways. um and and Lacy in particular um has been very successful over the years in competing for these grants with the strategies that we use. Um and and not just for federal funds, but for state grants as well. Um you know, as I said, we just got a grant to build, you know, the sidewalk and roadway improvements on Reineer Road. Um, so I can commit to you that that will be our strategy going forward because it has been our strategy in the past and and I feel like we have been very successful in delivering these

projects and, you know, continuing to improve our our network for for both pedestrians and roadway users.

I I appreciate what you're saying and I know we've been super successful um because I walk them and I ride my bicycle on them and all those fun things. Um, when I say sidewalk capital, and I'm not advocating for sidewalk capital to be added on this, I agree we should, you know, do what we know and feel is really going to get passed. But when I look at adding sidewalk capital, I'm not just looking at today or tomorrow. I'm looking at the potential annexations that could happen in the next 10 years that could boost these dollars up to a level that we could actually use them for some of the sidewalk capital projects. So, I'll I'll leave it at that. I'm not going to push it. Um, I want this to pass too and I'm okay with with doing it in February instead of November, but that is the thought process when I look at adding this this language. Um, I like I said, I I I am where I'm at. I I you know I as long as there's a commitment to strategize and and and go forward I I would hate to be looked back and say we missed an opportunity um um to have a funding source available when necessary um then completely take that out of the equation. But you know it is what it is. You know, I remember 10 years ago when we went to past this, uh, you know, we were told 10 years from that date, we still our pavement index was going to fall below to what it is at that moment. Well, we we know that hasn't been the case. We've been able to meet and in and our same payment index today that we did had 10 years ago. I think that's a probably a better better testament of of how well we've done on grants and and some other things to be able to fill that gap um and be able to do these bigger projects and be able to

keep that pavement index rating the same. Um, but I, you know, I have the same faith that we can figure it out in in the future as well and continue to have a good transportation network that's operating um, you know, a lot better than other jurisdictions for sure. But I think we beat this beat this down. Would it would it be fair to ask that the city manager and staff come back within say four to six months with at least the beginnings of a strategy and maybe we schedule a special um mini retreat or something to really tear into it when you're ready? Um, I have to kind of maybe talk with the council a little bit more what that could look like because when we we're already have on the program I was looking at the update to the pedestrian bicycle plan as that vehicle to do that and when that's programmed in but also too we're going to go through some um staffing uh turnover here pretty soon too that's going to also affect our current capacity for the rest for the rest of this next four or five months. So, I need to figure out sit down with Aubrey and we can kind of talk through and figure out what that would look like. I can't guarantee in four to six months, but we will be bringing that forward as part of that pedestrian bicycle update for sure.

Okay. Well, we'll keep reminding you. So, I I just wanted to clarify, did everyone get a chance to speak and and is everyone in agreement that it's February and same valve language? Okay. Yeah. Thank you so much for your patience with us. Thank you. I appreciate you making both decisions tonight. That that helps. So, our last uh well, second last agenda item is our um 2025 year and financial briefing. Troy, this decision require action.

Yeah. So, this will come. So, this gives us this gives Yeah. This gives us direction. So we start preparing and we'll have a resolution prepared both for setting the ballot date and the the language on the ballot. So you have another chance to talk about this for formal action. Yeah. We just gave them direction. Yeah. Forward. Yeah. Troy.

Thank you, Mr. Mayor. Good evening, council. We have uh for you the preliminary year-end uh financial condition for the city. I do want to emphasize preliminary we are still working on our financial statements. So they're still subject to change but we feel confident that we're we're pretty close right now. So I certainly want to give you the results of what happened in 2025. Um we're going to talk about well going to focus on general fund a little bit on utilities going to talk about what happened on the expendure side revenue side. Special treat we're going to talk about cash. We normally don't talk about cash this time of year, but we've had a lot of discussion about ending cash and what all that means in reserves. So, we want to get before you a little bit earlier in the year to have that discussion. Then I'll wrap things up and talk about kind of what we're seeing out there right now, what might happen in the future. Um, I know whatever I tell you will be wrong, but at least we'll have some some discussion about that.

It's terrible right now. So we're going to start with the current expense fund. This is the fund that provides the services I think our citizens most easily identify with. Um you know like police and uh council of course uh engineering other public works uh parks and wreck uh and culture are within that. So here are the results basically side by side with 2024 and 25. You could see in 25 we spent about 7.8 8 million less than we did in 24. Um kind of want to just talk high level. You have lots of details in the staff report. Uh but these are the main areas and where we saw a change in 20125. I'll start at the bottom. Um we had about $10.6 million less in transfers. And this is really completely related to the funding of the police station and the training facility. 2024 we transferred about $17 million out of this fund into the building fund. So that's the main difference um you're seeing in the results for 25 in community and economic development. We have about a $679,000 um increase. A lot of this has to do with um strategic investments, but there were um three major grants that came from Department of Commerce uh relating to uh sustainability, middle housing, and some uh comp plan type planning. So, we had some increased expenditures there. Uh human uh and social services about an $866,000 increase. Uh the majority of this relates to the surplus property we bought from lot and we're going to transform into affordable housing. That was about 451,000 if my memory serves. Um we had the first year of the uh human and social services grant program that was about 330,000 or

so. So that's where the the main difference there. And the final area that I want to highlight is contracted services. um had about a $337,000 increase compared to 2024. Uh we had a an election for city council that caused election cost to increase. That was about 118,000. And really want to highlight the public defense increase. It was about $109,000. As you know, we're going to be implementing new public defense standards over a 10-year period. And this is really just the start of that uh process. And um as we uh you know go forward

what's under the city council for expend expenditures

it's the city council salary so to speak there is um NLC AWC fees uh membership fees come out of that your travel of course uh the neighborhood grant program 60,000 is coming out of there uh so yeah um that makes up that um do want to show you the entire general fund. It's made up of seven different funds um and its results for 2025. Um all combined we spent about $6.7 million less. Um again, most of that is coming from the current expense fund which we just covered. Uh the criminal justice was down about 1.7 million. That is also due to the police station project. We in 2024 we transferred $1.6 million out of that fund for that project. Um we did have an increase in the street fund. Uh that's largely due to a transfer as well. So in 2025 we transferred a million dollars from that fund uh to the arterial street fund for the design of the seventh and college roundabout. So a million dollars there. I do want to show a side by side with the um authorized budget compared to what we spent in 2025. We spent about 13.2 under budget.

Um a lot of that has to do with capital, but I'm really going to highlight the current expense fund. Again, um we had a savings of about $2.5 million in salaries and benefits. Um a lot of that's due to vacancies. I think we probably average between 25 and 30 vacancies throughout the year. Uh so that's a significant savings. Uh but there's a great deal of that that's being carried over into the 26 budget. In fact, you've already taken action on that. Um some examples uh also relate to those Department of Commerce uh grants for middle housing and sustainability. Um those are carried over. um a big uh carryover was $3 million for the uh regional supportive um housing project. So that also was carried over. So a great deal of that was carried over. I would say overall the the savings I'll call true savings in terms of operations was probably around $3.5 million. But the rest like I said is either in carryovers or capital projects that will actually still uh be uh completed. So about the same amount as we predicted to be short. We pretty much covered it

give or take. Yeah. Well, actually a little more than that, but more that we had about 1.7 in 2025. This year it's the three. Yeah.

So let's switch and look at revenues real quick. Um again, I'm just going to make some some highle highlights here. Here's your uh tax revenues for 2025 compared to 2024. About a $3 million increase. Uh majority of this is coming from utility tax. About $1.7 million combined increase there. A lot of that has to do with rate increases and just about all of these areas, but there's definitely some growth in terms of consumption that occurred within those areas. Um sales tax, $358,000 increase. This is about 2.1 2.2% increase. We had a good end of the year. Um, as you know, through most of 2025, we were falling behind the previous year, but um, we rallied pretty pretty strongly there at the end of the year. Um, property tax increase of about $827,000. only about 440,000 is what I would call true increases from new construction, the 1% and the refund levy. Um, we had a shift in allocation of about uh 190,000 or so. So, we fund community buildings out of property tax and we had less going to community buildings and more going to the current expense fund. Again, about $190,000. Um we have an accounting change of about 75,000 or so. Um state auditor advised us to receipt all property tax. So everything that we levy because it's pretty much a guarantee that we'll receive those property taxes eventually. Um after 3 years the county will full foreclose on properties and we'll receive our full share of property tax. Previously we only actually booked what we received. So we're we're booking the entire amount that we love it.

That's weird. So you're booking the money that you don't even that you don't receive that they that's strange and yeah I government accounting is so different than in the real world. Well and and yeah that's an understatement in a lot of ways. Yeah. You are guaranteed those dollars, but until it comes in, I don't know how you actually doesn't come in. You can't Yeah. Until you get them, you can't spend it. So, we just kind of do we have like a different section for unrealized gains or it ends up being a receivable and not cash. So, we won't spend it, I guess, is one way of answering that. But

we don't have it in spend. But that that's also complicates you know when we talk about our financial statement and our numbers is all numbers are not actually you know there there's stuff behind it that makes it different. So yeah but thankfully it's a relatively small impact again about 75,000. That's weird. Um historically speaking our our increase in revenue from property tax to sales taxes where's that been? I mean, this shows a considerably bigger increase in property tax to sales tax. I don't really remember that happening in the past.

Uh, yeah, certainly in the short term. I mean, sales tax, especially after the pandemic, I mean, it it skyrocketed. So, it far outpaced property tax. So, but even going back the past 10 10 years, maybe the sales tax is always outgainained property tax, hasn't it? Um, I think it kind of depends. I mean, it's very cyclical in nature. Um, when we have strong development, property tax increases higher.

Uh, so it really depends on the year, but certainly, you know, in the last five years, it's been it's been sales tax because development has been a lot slower last five years than it than it had been um at as we ended the the 2010. So, it really depends on the year. Uh, but there's definitely more potential in sales tax. Um, there's also the potential to go way down as well. It can go the other way. It's pretty volatile where property tax grows pretty steady and it always

1% plus, you know, as you know, the the ley rate comes down. So, we actually don't lose in terms of property tax revenue. So, again, it really depends on the year. But, yeah, short term it's been sales tax. Yeah, that's an I think that's the first thing I looked at. It jumped out when you're looking at this. The other thing was um all year long being OTAX was way outpacing sales tax. I mean all year, you know, and it was like what is going on? Um and here we got to the end and sure enough sales tax um out outpaced uh our our BNO tax. So that is the other it's the those top three things are the ones that sort of stand out to me that was different from the last time we we saw these numbers.

Sure.

Yeah. I think with being O tax we've probably kind of reached equilibrium in terms of the service industry being fully recovered. You know we had a pretty big ramp up as services as we came back out of the pandemic and I think we just kind of reached that equilibrium as part of what's happening. Uh not a lot to say about fees and uh and service charges. Um pretty pretty steady. I mean, not a lot of growth there. But what I will point out is um under licenses and permits. I really want to focus in on what happened with building permits. That's kind of hidden in this number. We only had about a $14,000 increase to building permits over the previous year. And the reason I say that is that's kind of an indication what might happen with development um in the in the short term. So development of course impacts property tax in the long term. In the short term we get sales tax on that construction. So as it stands now you know we would expect that development is not going to change a whole lot. So there's not going to be a lot of growth there. So you know think about that in the conversation about property tax future property tax growth. Um, also, uh, environmental e economic, uh, environment and planchecking, that's another indicator of of development. And this number is a little misleading

as well.

Um, so we're showing a $64,000 increase to that category, but what's not seen easily in this number is that planchecking fees went down about 113,000. So that's also an early indicator of development. So as plans come in, we charge a fee to review those. So that's down um again $113,000. What's offsetting that is about $184,000 in inspection fees that we shifted from the utilities into the general fund. So that's that's what's kind of masking that uh decline to plan check fees. So it's all to say that we think development in the next 12 months or so is probably going to be very similar. It might even be down a little bit in the long term because of what we're seeing in plan check fees. So what did we move over? Where did we move over?

Uh we moved inspection fees. Um so development, think development. So we were um when we would conduct a sewer or water inspection fee, we're receiving those in utilities, but that's actually a general fund function. Yeah. So development is not a utility function. So was that something that we caught or is that an audit? That was a state auditor thing a couple years ago, but we found a couple accounts for whatever reason didn't get shifted over. So, we made that change in August or September of last year. So, now all inspection fees are now being received in the general fund. Interesting.

Um, inter governmental revenues. Uh, you know, the big story here is what happened in grants. Uh, we had a $4.3 million decrease here. um that it's all grants that were received in um 2024. So the the big grant that received there was well it wasn't really a grant received in that year but it was the money that the ARPA money that we applied to the police station $3.7 million was actually realized on the revenue side when we applied that to the police station project. So that occurred in 2024. So 2024 we spent the last of our ARPA ARPA dollars and that's why that shows a big difference there. That makes explains it.

I was looking at that. So I'm I'm surprised that liquor excise dropped so much from 24 to 25 but liquor profits rose by $33. Shouldn't those two be tied? I mean, what uh excise taxes, it's kind of mislabeled. I think that's the licensing side of um of that. So So like if someone comes and gets a uh a their liquor permit, Yes. that would go under the liquor excise. Yeah. So,

and this is this is statewide and it's distributed on a per capita basis. So, it's not just lacy. Um, so yeah, all the revenues that come in get distributed to cities based on population. So, it's can't really look and see what happened in Lacy that will be any indication of that. So, interesting.

Uh, miscellaneous. This is basically just everything else. Uh, couple things to point out there. Other miscellaneous that category is down about $495,000. Uh, part of that is a it's an accounting government accounting thing. It's a it's a capital lease uh accounting standard that we have to account for. Um, I'm not even going to try to explain it. I don't think I could if I I wanted to. There are people much smarter than me that work in in in our finance department to figure that out. But that was a negative $372,000 adjustment in in 2025. Um really has to do with predicting future revenue lease revenues that are coming to the city. So we made this adjustment on that receivable based on our long-term leases. Um and that's really all I could say about that one. But um the other uh significant decrease that happened there was about a $216,000 decrease to the op opioid settlements and that's really just because we had kind of a catch-up in 2024 and those will come in more steady in future years. I would point out interest earnings. It shows an $88,000 decrease. That's a little bit misleading because that includes some market valuation changes. If you look at interest earnings by themselves in the in the uh current expense fund,

they're down about $385,000. Um we had interest rates go down. We had less principal because of the monies we spent on the police station. So overall those are actually down more than what they're showing. Yeah, that I looked at that too and I said there's no way we're only down $87,000 in interest earnings from Yep. again 24 to 25. Yeah. another accounting adjustment that we make interesting for valuation.

I do want to show revenues as what came in versus what we were budgeted. And you'll notice that we were about 17 million under what we budgeted, but a lot of that has to do with budgeted use of cash that actually didn't occur, transfers that didn't occur because of capital projects that didn't get completed in 2025. uh but that number is bigger than the savings so to speak that we had on the expenditure side and I'll illustrate that here side by side here we have the 2025 general fund revenues next to the 2025 expenditures uh we spent about $3.9 million more than we brought in uh but that's not a statement about panic or an issue with our budget that's really planned draw down of reserves um the Easiest way to kind of quantify that for you is we had about $5.4 million of reserves go to Kuyo Park development. So think about that being bigger than that $3.9 million deficit that's shown here. So

that's why you know transfers are considered expenditures which is not an expenditure but that's why uh government financing is so crazy.

Exactly. I just want to spend just a couple minutes on utilities. Um utilities, no surprises. Um on the revenue side, um we had rate increases. Uh you know, we did have some increase in in consumption as well, but pretty much came in as expected. So, um higher than 2024 on on all three utilities. Um same on the expenditure side. um you know we had uh much bigger uh capital improvement programs planned uh larger transfers going to those capital uh uh funds. So um again uh although we're showing increase those were expected. So preliminary cash I want to do maybe something a little bit different with with the council. So you do have in your packet the cash the snapshot of cash for all 31 funds. Um, I will spend a little bit of time there, but thought I'd spend some time on kind of the education side. Uh, government accounting is very complicated and not easily explained. I'm I'm going to attempt to do some of that, but probably going to do a poor job of that. Um, I did get some feedback from my fellow directors. um you know we kind of previewed this presentation and the results and I think a common theme was we don't know the definition of many things that you're talking about. So cash as an example what is what is cash? Um so kind of want to spend some time there kind of spend some time on the funds and the purpose of the funds and um basically kind of paint a picture what actually is available. So maybe not spend so much time in the details of what cash is, but kind of explain that. Um, so the definitions, I thought I'd poke a little fun at my profession. Um,

you know, let's talk about the Webster dictionary definition of accountant. Um, the first one is it's a person skilled in recording, classification, analysis, reporting of financial transactions, and solving problems you didn't know existed. Of course. Is that really the judged that? Yeah, that might have been added. Um,

so I actually, believe it or not, saw that on a t-shirt. Uh, to answer your question, yes, they actually do make funny accounting t-shirts if you want to buy them. Um, so yeah. Um, you know, and that's that's true of all city staff. We're solving problems that most of us don't know existed. I mean, we're all trying to solve those problems before our boss even knows they exist. So I think we all do a good job here at the city doing that. Uh the second definition is one who gives an account or explanation particularly in matters involving financial stewardship or responsibility in a manner that people cannot understand. So that's that's the portion that I'm going to try to help uh solve tonight the best I can. It's not by purpose. We follow a lot of different rules. We have numerous uh regulating agencies and standard setting boards. Um the state auditor sets standards and the way we report. In fact, our budget is pretty much prescribed by a manual that the state auditor's office puts out. So I'm not saying we just follow rules, but we kind of do um have to by law.

So I'm going to go through these relatively quickly. Like I said, you have this in your packet. Uh this is the general fund. Uh we ended the year uh with about $55 million in cash. I'm going to really gloss over this because I use this as an example later on. So we'll get into the details of the general fund in a few slides. Uh but do want to talk about the utilities. Uh as you know from the budgeting process, the utilities spend over half of the city's monies. Um big operations. Uh they ended the year with $96.5 million in cash. um most of that in capital. Um but you know when we think about $96 million that that is a huge number. Uh but to put that in perspective, the 2026 budget, capital budget for the three utilities is $54 million. That's one year. I'm not saying we're going to spend all that money, but we do need to have the money in the bank to have those types of programs budgeted. And that's just one year. Over a six-year period, these these uh capital improvement programs reach the six, you know, the hundreds of millions of dollars, you know. So, um while while it's large, it the number is actually reassuring to me because it means less debt. It means less future rate increases for our our rate payers. So, um it actually is a a good thing to have that that level of cash in those utilities. Um, special revenue funds. You've actually spoke a lot about these in your previous discussion. Special revenue funds, these are funds that are funded through special revenues. So, they have to have basically a majority of their funding come from a special revenue. These special revenues are often um very restricted in which you could spend them. So, we put them in separate funds so we could account for them to the public to the uh to the source of

those revenues. So, they go into a separate fund. we could expense, we could track revenues and expenditures in the same fund and we know that they're being spent appropriately. Um, Arterial Street Fund, you spoke about this um, a lot in your previous discussion. We ended the year with $31 million in this fund, but you know, keep that number in mind as I get to the end. We're going to talk a little bit about what happened in that fund and what's going into the future. But again, these num these funds here ended the year almost $45 million, but they are for dedicated purposes. Uh capital project funds, we have three in the city. Um these are we use these specifically to track capital projects just like their name. So um the building improvement fund, we ended the year with $17 million in that fund. Uh but a large large amount of that is going to be spent. In fact, a large a lot of it's already been spent since we flipped to the new calendar year. In 2026, we have just over $10 million budgeted for the completion of the police station. So, a great deal of that is going to be spent in uh 2026. Uh the capital project revenue fund there at the bottom ended the year with $2.5 million. That is essentially your refund that you were talking about. So that's how much um we have in that in that fund in terms of read dollars being collected in 2025.

That what we expected? It's actually a little bit more. Yeah. Um so we expected like yeah two 2.1 or something like that is what we were saying. Well we expected 2.5 in recollections uh in 2025. We only had a a partial debt payment for the uh police station bonds. Uh but we also had a good year in recollections. And you're really testing my memory here, but I think we brought in three 3.5 or 3.6 in real estate excise tax. Again, we long-term projections about 2.5. Yeah.

Um we had a significant property uh purchase in August or September. I mean tens of millions of dollars in one transaction. And so that's that's what led to that uh 3.5 or 3.6 in real estate excise tax. So definitely did better than we did uh than we expected. Uh here are your debt funds. Uh you know, this is where we we track and account for all of our debt, the debt issuance, and then the the future repayment. We've talked about that L fund for a few years now. In terms of those funds, those are available for any general public purpose. So, you know, when we think about future planning and future projects, that's certainly a source, but I think that probably warrants a different separate conversation with council in the future.

And that's the those go bonds. That's the last What's What's Where's that was that from? Uh that's just a little bit of interest earnings that are in our our geo bond fund. Um we would typically strive for for zero just because um either monies are transferred in from other funds or uh property tax levies um fund that. Uh but we have just a little bit there for a little bit of wiggle room in terms of cash flow in case say property taxes are paid late. It just gives us a little bit of a safety net there.

Yeah. And so basically that LI that's the interest that we've made off of LI or local improvement districts over the years plus interest that we've collected on those pay over the years. It's it's interest earnings for sure. Um because we don't have that many active no less on the last major one we have was L19 which was Main Street. They did the the street improvements there in Northeast Lacy. Uh but a lot of that comes from early repayment on those LEDs. So typically what happens when a property sells,

the banks don't want to be second in line for repayment behind the city. So we we're we're higher up on the pecking order of who gets paid first in a default. Um, so typically what happens is leds are required to be paid by the lenders and so we get that early payment and we can pay off debt early and then we start earning that interest. Yeah. And as you know we set those um assessments at the very beginning. So that interest it's not fair to call it prepaid but it's built into that over that 20-year period or 15ear period depending on what that is. So, but yeah, it's a lot of that is interest.

Wow. Well, that's definitely a a circle to come back later to, right? Absolutely.

Um internal service funds. So, these are um these are kind of businesses within the city. So, these these two businesses serve other city departments. So, equipment rental are primarily vehicles. So, the vehicles are owned by this fund. they're rented or leased to the departments. Um, information management systems, very similar to that, but for computers. The computers are owned by this fund and they're rented out to uh the users. Uh, what you're seeing in Indian cashier is pretty significant. $24.7 million. That's primarily almost all of it is replacement dollars. So, we also collect replacement of this equipment on a yearly basis. We take the expected or projected life of that equipment and we divide that by its life and the expected replacement cost and we collect that each year. Um, it's seems like a lot. In fact, I was a little surprised equipment rental. I was like, "Wow, that's a lot of money." But to put things in perspective, a single street sweeper cost half million dollars. um vector. I think we have three citywide. They're $750,000 each. So, we're collecting the replacement for those as we go. Um every police car that we purchase is $110,000 and we have several police cars. So, actually that number seems pretty reasonable when you think about in those terms.

So, I mean, how much of the 100% replacement cost is in that number? because it's the number above that that's really where we, you know, where you could look at maybe shifting some dollars out, right? Yeah. It's a rolling number. So, it's a, you know, we purchase a if we bought a new vector. Yeah. We would take $750,000 out of that and we would start building that up. But, it's probably around $4 million that is there that we have. We have some and beyond.

Yeah. We're some of that's we're thinking that you know as we convert our fleet to electric vehicles they're more expensive. So we've been using that money to supplement those in terms of those replacements. But another thought is if budgets get really tight we could defer replacement and fund it from that that surplus. That would bias time in terms of that that bill that our departments are paying every month. So, and we we did do that early on a little bit, right? Um, and during some of your first years in office, 2010, I think we did that, 2009, 2010. Back in the day, when things were tight,

we had to play some catch up on off of those decisions and get back to health. But also too, in the last couple budget cycles and our fleet replacement, we've had some replacement vehicles that didn't quite make up their full replacement value. So there is a little bit of cost increased inflationary cost of the vehicle. It didn't keep pace with we try though. I mean the attempt is to get 100% replacement over the what you expect the life vehicle to be but of course it's hard to predict. You couldn't have possibly predicted the inflation we had in cars and automobiles in general after co.

So that's where that that that fund is fluid because there's a lot of variables in there that uh can cause it. And then of course, you know, as the big ticket items too, um the next time you replace those, they can grow exponentially as well. Do you do salvage do salvage dollars return to this fund as well? We do. Yep. We send men we send a lot of vehicles to auction. Um the app comes back and replenishes the the fund. Um we do we have a 5% inflation built into our rates, but that hasn't that hasn't kept up in probably eight years. And then and then depending on vehicle usage, you can have a three or or five year replacement. So then that that also has a factor in the inflationary factor.

We're seeing like an EMS vehicle, we're seeing almost double digit inflation and we're having to order them now like three to four years before we actually need them. That's how long it's taking to get them. It's crazy. Yeah. Well, many fire departments in my experience aren't even able to fund their replacement because of how expensive and how fast the the cost they're taking they're taking over five years now when they order a new engine process to get it. So, they've got to order it way before they are ready. The same way factor trucks and sweepers, too. Yeah. I don't know if that's five years, but it's it's it's a definitely a pre-order.

Yeah, there's not that many manufacturers. It's been a long time since I bought a firet truck, but at the time I think there was only two makers in the United States. It might be down to one. I thought I might have heard. So, yeah.

Okay. So, here is all of your funds, all the the six categories. We ended the year with about $246 million in in cash. Um, here's where I try to explain what cash is, is as kind of weird as that sounds. Um but uh also kind of want to show before I get there kind of show what happened overall between 2024 2025. So overall cash went down um about $1.3 million. Um a lot of changing between the funds. We you know we talked about the general fund earlier that we in intentionally brought down cash on utility funds. Uh we had cash go up, but that's just because we're behind on some capital projects. Uh special revenue funds. This is really remember I asked you to remember that number about the uh arterial street having $ 31 million or so in it. Um we brought down cash in arterial streets by $6.6 million because of the fact that we took REIT and put it into a different fund. It's pretty limited what's coming into arterial streets. Um we have fuel tax. uh it's about a half million dollars per year coming into arterial streets and that's really all we have in terms of that ongoing funding um for our streets. So, you know, definitely we knew that going into this and you know, we kind of thought about moving that REIT money to transportation as a first priority, but you know, again, it's something for council to to consider as we have all these other uh competing

to its own fund, but we still but it's still there. We can still use it for transportation. It just isn't in that funding. It gives it more flexibility for setting the priorities of that what's beyond the debt payment, how we utilize those funds for other pri council priorities or city priorities. You said, yeah, we set aside for re the debt payment first and then it brings in more than the debt. So, so as as Troy mentioned, it it it's not going directly into the RTO street. Now we can look at all council priorities and and figure out, you know, like we conversation we had earlier, do we how do we fund these type of things once we know what the strategy is

and we did not transfer any REIT dollars into our tero streets in 2025. So that explains why there's pretty decent draw down there too. Um you know and as as I mentioned earlier projects you know that's primarily the building fund and we're going to spend a great deal of that um this year. So, let's talk about the color of the money. Color of money. And I'm really kind of stealing a a a statement from former council member Vasquez in terms of how we explain cash. Um so, um really I want to kind of focus on cash and availability. There's a difference between those two. So, I'm going to illustrate that through uh general fund cash. So here's a table for you that's 24 and 25 side by side again. Um so looking at the 25 column um same number that presented earlier about 55 million in ending cash. Uh that is an accounting term that's just a snapshot in time 1159 December 31st 2025 we had $55 million in cash and that's what we report we just report on a year-end basis. So everything's based on that snapshot in time. It changed almost immediately the first day of business. Um and it's continued to change. So whatever cash is today is not the same as it is there. Uh so what you have in red are the balance cash balances that I would consider not available for the day-to-day operations. So again, snapshot in time on December 31st, we had accounts payable of about $1.2 million. Those are expenses that we incurred in 2025, but we just haven't paid the bill yet. So, I'm assuming that we've paid that bill by now. We we we pay our bills pretty timely. So,

certainly in April of 26, those monies have been spent already. Uh we have a two-month operating reserve by city council fiscal policy. Um that number, that calculation for 2026 is $1.6 million. This is equal to two months of operating revenue. So it's just simply a calculation on the budget. Um what's critical here is this is our cash flow. Um revenues are cyclical in nature. Property tax comes in twice a year primarily like 90 95% of all property tax comes in just two months out of the year. So we want to make sure that we have enough cash to carry us until the next property tax payment. um sales tax is cyclical in terms of summer versus spring in terms of construction activity and that type of thing. So we just need cash on hand to pay the bills. Um our payroll bill every single month is somewhere around $4.5 million. So the last day of the month we have $4.5 million going out whether we have revenues to cover that or not. So that's what our operating reserve is. uh beginning cash in 2025, we already have 6 point at the time of budget adoption, we had 6.6 million already obligated in 2026. So those were reserves that we're using for capital projects. Uh some of that uh budget strategy is in that $6.6 million. So those are monies that have been authorized by council for expenditure. So we consider those non or not available for operating. And then restricting reserves is the last area that I would consider not available for operating. And we have about $3.4 million. So these restricted reserves are either there's a legal obligation that we have to spend on certain things or maybe there's a contractual um obligation. Some of these are

donations from uh the public that are for very specific reasons. So again, those are not readily available for the day-to-day operations. And then you have everything else, and that's what I would consider discretionary. Um, so you have a budget amendment contingency. We just hold that there for kind of emergency and unforeseen uh budget amendments that might be needed. Uh, your committed total, that's the action that city council took in December to commit reserves. That total was about 20.8 uh million. And then we've uh city manager and myself have kind of looked at council priorities. We looked at past reserves and have identified about $10 million in assigned reserves uh which will um um also be a um a communication to the public on our intent, our priorities, our our um initiatives for the for the public. So that's kind of the color of money. So in terms of that $55 million, I would only consider about 32 million uh discretionary. So to show you that and kind of graph on this exact same numbers. Um you have discretionary there in red and I apologize for the formatting that kept flipping back and forth whether it's formatted or not. I guess it's not formatted to at this moment, but 32 $32 million is what I would consider uh discretionary. Uh the the the pie chart on the right there is the makeup of that $32 million. Again, committed reserves, assigned reserves making up the vast majority of that. So, you know, I want to talk about that discretionary um dollars in terms of what the council has communicated um in terms of priorities for this community. And this is a kind of just a snapshot of some of the larger items that the council's communicated in terms of

budget policy. So that's our, you know, we're we're we're seeing that, you know, we're the budget's a bit challenged. So we have a little bit more money there in terms of giving us that flexibility, but we have strategic economic development investments at 3 million. City hall improvements 3 million, joint animal services 3 million, and so on and so on. So about $21 million. I think the council's pretty clearly communicated what those priorities are in terms of for this community. So discretionary, yes, the council could change these anytime they want. You just need to direct staff. We'll bring forth another ordinance and we could change these priorities anytime you want. But this is pretty much what we feel as staff you communicated at the end of December.

What is a police station? It's the As as the police department moves into the new facility, we need to take the uh the previous space and either winterize it or or decommission it so that it uh we can maintain it until we figure out what use we have for it in the future. And and that's just a a budget a placement in there. We don't know what that actual dollar amount or what it will actually be. We just want to put something aside to Yeah. make sure we were addressing that future need. So

two years a council adopted a capital facilities plan. We hired a group called makers come through and do an assessment and they estimated to give us that number as a as a starting point. It could be a little bit less, could be a little bit more.

Okay. So that's kind of cash where we saw it at year end. So I want to look to the future a little bit and uh remind council of some actions we've already taken that are going to impact future cash. So um what you have here are known adjustments to the budget that had the potential to impact cash. So you have u the ending cash number carried forward from previous slides. Uh the second column there of numbers is the uh carryover amendment that council took action on in March. So that increased the budget that was $32 million. So a large portion of that came from cash. So, think about unspent cash and 25 being carried forward to be expended in 2026. Um, we've already identified about $7.5 million of amendments for 2026. U majority of that is in utilities. Um, that's a potential property purchase. That's um makes up the majority of that. But when you net that all out in terms of authorized expenditures uh by staff through the budget, that brings cash down to $26 million. So again, there's cash, there's available cash. Um we could talk about reserves and all kinds of other accounting terms, but really think about cash, what's reported, and cash, what is actually available for expenditure. Two very different things. So um you could even see that illustrated here. Um, you know, I don't think we're going to be as low as $26 million when we talk about this this time next year about 2026, but it's certainly authorized within the budget for expenditures. So, we account for that as expended to be conservative. Okay. Well, that's it for cash. We'll shift to kind of what we think our outlook is. I don't know if I did a good job or a poor job, but I hope you know just a little bit more and I'd feel happy about that in terms of of cash as

we think about that. Thank you.

Okay, financial outlook. I think I mentioned whatever I say tonight is likely to be wrong or at least changed by tomorrow morning. It just seems to be the way of the world now. Um, but let's kind of just talk a little bit about what's happened in the past to really inform what we think may happen in the future. So, let's talk property tax and and you know, the mayor kind of already talked to this a little bit. Um, here's our history, 10-year history of uh new construction versus how much that meant in terms of property tax increases. So, you have the the blue columns there is the construction value. That's how much construction was added to the assessment roles. And that the scale is there on the left. new construction. It's in the hundreds of millions of dollars as as we've gone through. Uh the amount that that's translated in property tax increases is the orange line. Um and it's the scale is on the right there. So really focusing on 2026 and we had a lot of discussion about this when we were talking about property taxes for the budget, but we didn't add that much in terms of new valuation in 2025 for 2026. um uh property tax or growth. So $68.5 million was added in 2025. Compare that to 2024. We added 290 million. Uh so a huge difference. And then look what happened in terms of property tax increase. In 2025, that resulted in $29,000 in property tax increase, but only $48,000 in increase in 2026. So when we think about development and it's slowing down, this is the impact to property tax and that one-time growth and we're trying to address expansion

increases with $48,000 plus 1% of about $90,000. So 132 130,000 or so. So we we had our second highest property tax valuation increase. That's 209,000 in 2025, which was our second best year over the past 10 years and probably going all the way back to

2000 maybe forever 607 when we saw the big huge neighborhoods come in. And so did did we predict predict that? I mean, no, we didn't. No, we didn't think it was going to be that high. And so, how confident are you with this two 2026 number? Well, that's a certified number. So, that that number is absolute. Um, but you see what but you're saying like I I remember you saying that our new construction for 2025 was not going to be that high.

Yeah, we used uh I think 150 million I think is what we used for 2025. I think longterm we're using 75 million in growth. But I mean we know we're going to reach buildout. Uh we know development is slowing. Um, you know, some of 2025 was annexation as well. I can't remember the breakout of that. Uh, I want to say it was about half, but for some reason that sounds wrong when I say it out loud, but we did have annexation that occurred in that 25 number as well. Um, yeah, we had one annexation that happened, right?

15,000. So yeah, I mean you know these are uh pretty volatile as well you know as we think about this portion of our property tax and what it means uh going forward too 2016 2015 we had 2014 we had a lot industrial multif family hit at that point. So that was a little bit higher piece as well and then dropped off and then built back up. That's that's why it's a little misleading that it should be property tax new assessments instead of new construction because right when you add annexations into that that's not new construction but we're we're

for that for the purposes of this it counts as new construction but it's really just new new assessment mostly new assessment comes by new construction but not always obviously.

Correct. It's a good point. Uh so sales tax um you of course get the monthly reports as I receive them but this is the uh top five combined categories. Um you know we have probably 120 different sales tax categories. So these are like I said combined uh the top five these what the numbers you're seeing here uh 2025 versus 24 for 25 that represents about 84% of all sales tax. So, it's pretty representative of the entire sales tax collections for the city. Um, you could see that, well, you can't see, but the total variance or increase from 25 from 24 is about $110,000. It's about 1% in these categories. Um, that's our our total increase for sales tax. Um, again, not a whole lot in terms of some of the things we're contending with on the expenditure side. So,

but considering early in the year we thought it was going to actually be down and not up. It wasn't looking good early on. Yeah. So, the recovery was pretty good. I mean, was not as much as we'd like, but Yeah. Correct. Pretty good. Yep. Yeah. I didn't mean to sound like I was complaining by any means. Well, yeah. A big jump in that December number. You know, that was the big number we were were waiting on. And it's always the big number that you know, you're just never quite sure, but it must have come in way, you know, a lot higher than we we thought come in. Yeah. The last quarter was was stronger than we expected or certainly what the the trend was last year. The wow was so hard.

Yeah. So, well, and I'm about to illustrate that with uh these five categories and the the comparison to the the month uh year prior. Um, so this is a 25 month snapshot. So you have uh all of 24 through all the sales tax that we're aware of, which is January 2026. That's the last sales tax update we got. Um, you could see that retail uh trade, which is about half of all sales tax, this one broad category is about 50%, a little bit under 50%. Uh, over that 25month period, basically zero growth as an average. So actually just a very very slight decrease. Uh but you could see the you know it's very volatile from month to month. Um but um we did you could see in that October September. So that's those are the sales tax sacks we received at the end of the year. You could see that that spike up there kind of towards the end. Uh but this category really is staying pretty flat. So that's, you know, think about that in terms of our indicators and it being the largest source of sales tax for us.

What happened in June? Great observation. I uh it was that was I think we had a misreporting that occurred in that month. So it catches up in the other months or maybe we had an over reporting in the month before. So that was more of an error versus what actually happened in terms of sales activity. So I was wondering what happened in June 24. Back in 24. Yeah. Well, then that's we said the same thing. We have some miscarriorization that happened. That's basically the bounceback. Yeah. You're comparing an inflated June, right?

24 to 25. So, um Yep. Yeah.

Yeah. That's exactly what happened. um construction very volatile and you can see this one is really all over the place and very big swings from from month to month but overall over the past the average decrease is almost 6% in construction. Um we've been watching this decline here for two years so that's you know really no surprise. Um accommodation and food. This is primarily restaurants, groceries. Um pretty different year, 25 compared to 24. Um overall average increase, monthly increase about 2.4%, but 24 was still really in a recovery mode from from the pandemic. We had some new restaurants come online as well during that period, but it's been a little bit different story in 2025. It's it's been up and down, but certainly not to the same degree that we saw that growth in 2024. So that's that's definitely plateauing in terms of that that recovery or the the impact of that recovery.

Cost of food, you know, cost of going out has just gone through the roof. It's just crazy. Yeah. I had a couple hamburgers and fries and a drink the other day. It's like what is going on? Yeah. And so it's four five guys, two burgers, sheriff fry, and two drinks. That's 40 bucks. Yeah, that's crazy. And so yeah, you could see there has to be some slow down. You just can't afford to do it. Yeah, volume is has to have gone down. Mhm. Prices have gone up quite a bit, right? And we've stayed pretty violent. That means if volume's down, price is up. And at some point Yeah. Like you said, new restaurants.

Yeah. Y uh wholesale trade is our fourth largest broad category over that period. The average monthly decrease is about 1.24%. Uh this is really tied to development, believe it or not. So uh think big equipment that goes into development, computer system, HVAC system, those come through wholesaling. We pay sales tax on the construction side. So when we when Lacy built something, it pays sales tax at that point on that equipment. But when it's being purchased by the uh contractor, it is a wholesaling activity. So very closely tied and you could see the the cyclical nature of that too. Uh it's a development um track. And then the last category, top five category is administrative support. Uh this is not very descriptive at all in terms of what that consists of, but there's a lot of landscaping companies in here. Uh streaming services is in this category. So um you could see it's had some pretty steady growth. Uh but this is a pretty minor category for us really too. So that's sales tax. Let's look at the expenditure side. Uh we do have our final numbers on the 2025 salary and benefits. Um we had an increase of about $2 million from 2024. So, you know, by far the a lower um overall increase. We only added three uh positions in the general fund in 2025. U had you know more growth in 23 24. So that's the reason you're seeing a less a lower value um increase but sales and benefits still increased about five and 5.25% so still growing faster than

inflation and there lies the biggest difficulty most important asset we have the people but the most expensive by far and always will be in government people are our biggest expense. Yeah

that's true. So yeah, and that's really the challenge in terms of $2 million increases in this one area. And granted, it's about twothirds of all the general fund expenses is in labor, but look what hap what's happening in sales tax. We're not seeing a lot of growth. $110,000. Property tax 48,000 from increased assessments. Um new construction 1%'s 90,000. That doesn't come close to adding up to um $2 million. So looking forward well looking back and forward to uh cost of living adjustments in terms our labor contracts you could see you know a six-year history um ask me which actually represents the most employees for the city. Um we had a 2.3% cola in 2026. We don't know what the 27 cola is going to be but we know what it's going to be based on. It's going to be based on 100% of uh the Seattle Tacoma Belleview consumer price index. Um we still have well the last index we received was February. So we still have four months to go. Um February's inflation was up from December's. December's was up from August because we didn't have an October inflation number because of the government shutdown. Uh but we're already through February, we're already in an increasing trend in inflation and that doesn't count the energy prices that spiked at the end of February. So all indications are inflation is going to increase through the first half of 2026

based on the June number. So first half uh it's a first half average. Oh, okay.

But yeah, so for us it's going to be February, April, and June. Um, February was already 3.76%. Uh, again, no energy, no gas in that inflationary number. We'll see that in about a month. We'll get the April numbers expected to be the national inflation spiked. So, expect the same thing to happen here in the Seattle area. Um, Lacy Police Officers Guild um 2.72% for 2026. uh they are unsettled for 2027. So we don't even know the factor in which that's going to be based on. In fact, all three police uh unions are unsettled for 2027. So this is going to be the year of negotiations for police.

So but it's going to be something similar. You know, historically anyway, it's been based on um that June or that first half inflation number. And again, we expect that to be rising through June. Uh this is what's happened to employee benefits in 2026. These are adopted rate increases. These are increases we're already paying. Uh Kaiser went up 11.6%. Uh regions this these are medical uh regions medical went up 8.7%. Uh we're about a 6040 split in our uh in our workforce. 60% are on regents about 40% on Kaiser. Um you could see our uh retirement contribution um actually a decrease to PERS actually that decrease happened in September I believe it was 9.11% I believe uh dental we had increases above inflation as well so benefits are increasing faster inflation too I do want to remind the council about future obligations um I think during your retreat you heard that we we took these out of the future future um projections. Um we kind of wanted a sidebyside comparison in terms of revenue enhancements that you're considering with kind of long-term obligations we have. But these are obligations that we do need to keep in mind even though we haven't quantified those in any sort of projection. Uh the two big ones in my mind in terms of 2027 are public defense. We do have to continue to implement the Supreme Court uh standards that they adopted last year. Um anywhere between 80 and 120,000 per year. We have a 10-year period in which we have to implement that. Um the other one is district court costs. Um that is another big contract we're going

to be negotiating in 2026. So we are without contract in 2027. So, um, we're expecting significant increases there based on other contracts that the county has negotiated here, um, recently. So, those are the two I think we need to kind of keep our eye on in terms of significant impacts to near future budgets. So, in conclusion, last slide, thanks for thanks for staying with me. Um, you know, we talked about the uncertainty. Uh, but in 25 2025, no no surprises. Uh, but I think we're are more uncertain now than we have been, even though I've continually said how uncertain things have been. That's kind of the worst it's been. But, um, sales tax looks to be flattening out. Um, certainly no indication that we're going to have big increases in sales tax going forward. Um the national um economic factors momentum is definitely weakening and basically all the indicators um whether it be uh gross domestic product, wages, job growth, all of those things are starting to weaken. Um inflation um we're just now seeing the inflation factors coming from the spike in energy or gasoline, oil, that type of thing. So certainly expect inflation to continue to rise um through the first half of 26. And then just the geopolitical factors that's changing things on seems like a day daily basis. Every time we look at the news there's different news and it changes the the environment. So that's what we're contending with in terms of looking forward. Um do want to talk about the importance of maintaining our conservative approach. Um, we have fiscal policies that past councils have adopted. They've served us well. Um, it's really put us in a position that we're at now. I

certainly appreciate our approach. Um, it's allowed us to move slow in terms of making decisions, hard decisions. We're not reacting. We're able to plan, take our time, and make meaningful decisions in terms of our budget. So, again, that has served us well. I thank the council for their support on all of that. um stay the course with our uh strategies to address our budget gap. Um you know, I know things in terms of year end. I I think our long-term projections improved when you what you saw at the retreat, but I want to advocate for keeping our our foot on the pedal. We don't want to lose momentum. Uh we don't want to have to act on any of these, but we want to be ready if we have to. Um it's my last bold is basically saying it's going to be too late by the time we know things are bad to to act and plan. We'll be in that reactionary mode. So um we definitely want to be able to act promptly. Uh a lot of the information receive is already two months old. Um by time right now we're two and a half months since we've seen the last sales activity here in Lacy. It was January is the last numbers we have. So we're we're blind a little bit. So by time we see things are bad, it's already been bad for a couple months. So you know, again, I I thank the council for their proactive approach, strong policy that's really put us in this position that we have the luxury, we had the the flexibility to wait, be methodical about our actions. So um all said, I hope we stay the course. Thank you for all of your support and and put us putting us in a position we're in. I think we're in a position that's far better than many of our neighbors uh certainly across the state. So, thank you for all that and uh happy to go back and answer any questions you might have.

I think we covered it. I thought it was really good. A lot of information, isn't it? Yeah. Good job, Troy. Okay. Um are there any council reports that need to go out today? I have one meeting else. Okay. Mine can wait. Yeah, it's pretty late. If it's not if it's not pressing, then yeah. Okay. Yeah. Then then we'll put off to our next uh meeting which won't happen next week. Next week we have a a um joint meeting with a port of Olympia. Um, it's at the port.

It's at the port. Yep. We'll get the address and information out. And it's at four. And it's on Monday, April 20th, and it's at 400 p.m. Um, and so we'll get you the address of where where we need to meet. Um, and so since we're having that meeting on Monday, we're not going to have our our council meeting on Tuesday as per used to be practice. It is practice now. Be there. and okay

that's we're working on getting the agenda set up. It's going to be some update on some of the port activities and how we can do some future partnerships conversation starts at 4 um up to two hours but you've been on the council and commission conversation occurs and I believe uh there's also um Jazzcom meeting that night too. So I think 5:30 5:30 so he's part of the first portion you have to leave early so understandable I think this just um I think it's important that we have this joint meeting with the port I think they they really need to hear from us what you know our expectations are our relationship with the port you know um it's been a while

it's been a while and our priorities and um our thoughts so I think it's important that we have this joint meeting and um and so I I look forward to that But with that um we have reached the end of our agenda. So without objection I'm going to call this meeting ajourned and you keep it classy lacy.