City Council - Regular Meeting

Good morning and welcome. I call to order the Lake Havasu City budget and CIP work session on Tuesday, 05/14/2026 at 9AM. Please join me in the pledge of allegiance. Thank you. Item three on the agenda is our roll call. Ms. Williams, if you please call the roll.

Council members Nancy Campbell?

Here.

Jenny Cook? Here. Jim Dolan? Cameron Moses?

Here.

Michelle Lin? Here. Vice Mayor David Diaz?

Here.

Mayor Kal

Sheehy? Here. Thank you.

Thank you. Item four is our public hearings. Item 4.1 is presentation discussion and potential direction to staff on the budget for fiscal year 'twenty five-'twenty six year end estimates, fiscal year 'twenty six-'twenty seven annual budget and the five year capital improvement plan. Mr. Knutson?

Good morning, Mayor. Good morning, Council. This is our second planned work session for budget presentation to City Council. Obviously, these conversations started a long time ago, beginning officially from the council's perspective back at the annual planning session we had back in, was it late February or early February or late January. So it's a continuation of all those things.

Staffs listened intently on trying to identify the priorities coming from council and putting together a budget that will address the, first and foremost the services we provide to our residents. So that is always our goal. Today the hope and goal is for clear final direction coming from council. So to guide the staff process and so we can smoothly walk into the tentative budget adoption and final budget adoption in June. Staff will be listening very intently on trying to identify that clear direction so we can update the budget and prepare that for council's consideration.

There is eight new positions that are being requested or recommended through the budget process. We are building Station seven. We need people in Station seven. So four of those are firefighter EMTs. And we're also looking at a conversation we had back at the annual planning session. We're having some challenges when we identify when we recruit and fill all the vacant police officer positions. So Chief Sterling talked to us about at the annual planning session about the concept or the idea. And I think it's fantastic. It's creative. It's out of the box.

It's something that's new and refreshing. But identifying police police officer technicians that would serve and help the existing officers we have. So the more paperwork, the more process, the more day to day activities that an officer finds themselves in that's not in a vehicle or on the street or assisting our residents, they'll help with all of that. And we want more time applied for our officers serving our public. So that's in the budget and Jill will talk about that as well.

You'll see that we're not no recommendations for any types of tax increases or anything of the like. We're doing our best to be as fiscally conservative as possible given the resources and funds that the city has. We want to be obviously good stewards of taxpayer dollars. We go through it. There's a lot of requests and needs are coming from the different departments.

A fraction of those were you'll find in the recommended budget today as presented. We're addressing some issues like 20 old generators at a fire station. The need for equipment AC or otherwise that is at its last breath And we want to identify those needs that are going to save us time and money now. We'd rather replace them than continue to repair them. At the last budget work session, we talked about the capital projects or the CIP, the capital improvement plan.

That's a five year plan for all of our capital projects. We left that meeting with some good direction, but we are going to display that again for council. And if there's any conversations that would like to take place, we are going to open it up for staff will be listening intently in terms of any direction that will be applied there. And with that, I just hope everybody has a very productive and happy budget meeting. And I'll turn it over to Ms. Olson for her presentation.

Good morning. Once again showing you the budget development timeline, you'll see that we are about to launch into June which will include the adoption of the tentative budget and the adoption of the final budget at the end of June. Today we're going to be reviewing the operating budget book and you have those budget books. They've been distributed to you. Those include the financial projections, so you can see the health of the status of each fund.

We go over the revenue and expenditure highlights and then also a look at the line item department budgets. The bound copy of your booklet does include all those materials segmented into sections so that they're quick and easy to identify. So today we'll take just a quick overview of the budget that's being presented. We'll take a look at the overall departmental budgets, take a look at next steps and then open it up for discussion and questions. So in beginning the budget overview, as we started finalizing estimates of revenues and expenditures for the general fund in particular as well as other funds, it became even more apparent that the city is approaching the maximum amount of revenues available for annual ongoing expenditures.

In determining the funds available for the proposed ongoing additions to the budget, we manage the spending level to stay within that maximum. However, we are closing the gap. I've heard comments just recently about some people saying the city says they're out of money. We didn't say we're out of money. What is happening is that we don't have additional funds each year in the annual ongoing revenue stream to add things to the budget, to increase, to add more staff than what we are proposing today.

So that's what we mean when the resources are limited. It doesn't mean we're out of money. So as discussed in prior meetings, the vast majority of the additional spending that is shown in this budget being proposed and in prior budgets has been for those one time expenditures that Mr. Knudson mentioned. The area of CIP, the capital improvement plan, vehicles, equipment facilities, kind of those deferred items that we've not been able to maintain in the leaner years.

We're playing catch up in trying to get those maintained today, maintained or replaced. We have managed over the years to accumulate a fund balance and some funds primarily the general fund, while still reserving the appropriate policy amounts for the budget stabilization reserve. The city has gone from an estimated excess General Fund fund balance in fiscal year twenty twenty one of $43,000,000 to an estimated balance of fiscal year twenty seven of $23,000,000 So that's a 20,000,000 reduction in that short timeframe. By fiscal year thirty one, it's anticipated that the general fund balance, the excess fund balance will be only around 1,600,000. That's not necessarily a bad thing.

To keep in mind, it's appropriate to find a balance between finding and maintaining sufficient fund balance and reserves, but also providing continual best and best services possible to the community. I'm not advocating for building up an excess fund balance while we still have deferred maintenance issues to address. I wanted to take this opportunity as a reminder as to how we have been funding the majority of the increases in our budget, those one time expenses and that is through the use of the excess fund balance which is now going down. That excess as I mentioned will be at a lower level than in past years and that's reasonable and expected. It's important that we are mindful that this is a finite amount of funds.

And to that point, we have a lack of available revenue sufficient to meet our ongoing budget needs. Between the lack of additional revenues and the expenditure limitation cap set by state law, we have to continue to be thoughtful and mindful of how we are spending our ongoing available resources. This overview is just meant to look at the reality of our financial condition. So with that, I'll begin the overview. There were some questions at the last budget work session and subsequent to that on the differences between the budget versus the actual amounts that were shown at the last meeting.

So this slide is to further clarify those differences and the details. This table is a reflection of the revenues and these are all revenues across all funds. The parentheses around the numbers in the variance column for the revenue slide that indicates that we've come in under what was budgeted. So you can see on the first line for taxes, we budgeted 49.6%, well I guess actually we came in, yes, that's true. And then we came in a little bit, we estimate we're going to come in a little bit under that.

So that's what those numbers indicate. You'll see some notes underneath that table that highlight some of the major differences. The biggest one is on that grants line. You'll see that there's a $9,000,000 difference and you'll see that under the notes, dollars 6,000,000 is the additional that we add to the budget each time for those grants that we're not even aware of yet that may come up during the year that we want to apply for and we want to receive and then we actually want to be able to spend. So we do add that in there so that we can do that.

Otherwise it doesn't get spent. We added on the revenue and the expenditure side. The other $3,000,000 of that $9,000,000 difference is attributable to grants we thought we would get but did not receive or perhaps we didn't apply for or maybe we received less than what we applied for. The other revenue in the amount of about $2,500,000 actually that was added for a potential donation for the outdoor pool. So last year when we did, we're doing the budget there was we talked about is there any opportunity or chance that somebody might donate or the school district might contribute to the outdoor pool and so we put a $2,500,000 number in there just in case.

So if we did receive it, we can actually spend it. So overall, I think what's important here when we remove the grants and donation information, we actually are coming in very close to what was budgeted. This next table for FY twenty twenty five, twenty six, our current one is the expenditure table set up in the same manner. For the expenditures, the parentheses around the numbers in the variance column means that we spent less than was budgeted. So that's a good thing.

The parentheses what usually indicates a negative is actually a positive story. So the notes below this are a little more extensive. You're going to see the majority of the differences are attributable to what's listed in those notes. Vacancies that occur where we have salary savings, we have that savings in the salaries and benefit line item, those two together make up about $2,300,000 difference. We're underspending by about 5,100,000 in services and then 2,200,000 in supplies.

The majority of these lines, the reason that we're under is because we need we're not going to be able to spend those funds by June 30, so we're going have to carry them forward into FY 2027. So those numbers will show up in FY 2027 and in addition it's for just spending less, but a lot of it is for those carry forwards. Again on the other expenditures, I did want to point out that information for the grants and the donation just as we added it for the revenue side, we have to add it for the expenditure side in order to actually spend it. So that's the primary difference on that on the other expenditures line. And so you'll see the differences there on especially capital outlay.

In CIP, a lot of the CIP is the second bridge and then also we have some debt savings that related to the refinancing of the wastewater bonds. So jumping into some of the changes for FY 2027. Overall in the personnel area, we're anticipating about a 5.2% increase over the prior budget. That includes some step and wage adjustments. These are for adjustments only for those employees who get what they would be on their classification date, they would get a step increase or the equivalent of a step increase of about 3.5%.

And those happen throughout the year. Everybody doesn't get their increase on the same date. So that is included in there. There is no additional wage adjustment, nothing for what you might consider a cost of living increase. There's nothing of that in there. There were not funds available for that. There is going to be a health insurance increase of about a little over 10% on health insurance rates. ASRS is actually decreasing very tiny bit, but we will take it. Also in the pension costs, this is for PSPRS, the Public Safety Personnel Retirement System. This is the average rate increases for all the tiers associated within those categories.

Fire is going up about 2.6% and police is going up about 6%. And then as Mr. Knudson mentioned, the only positions that are added in this proposed budget are for public safety. There are six firefighter paramedic positions, four police service technicians and then there is in the police department just one reclassification from part time to full time for accreditation specialist. So in the category of services, supplies and capital, the proposed budget for these areas is actually decreasing.

There are fewer carry forwards, fewer supplemental one time expenditure approvals, so that number also contributes to it being less. So overall FY '27 on services, supplies and capital is about $2,400,000 less than it was in fiscal year twenty six. There was another $500,000 added for park improvements and you'll see on the supplemental list there, those approvals included those items that Mr. Knudsen referenced to as well, those ongoing maintenance and repair issues and replacement issues for those deferred items, roofs, HVAC, generators, repair and replacement of all of that. But we did include the additional $500,000 for park improvements and amenities again just as we did in FY '26.

Other revenues and expenditures, important to note that we did include contingency budgets in the appropriate funds That includes that's money for unfunded critical items within each fund. In the general fund that's $1,000,000 which is the same as it was last year and in prior years. Again for the unknown grants and donations, those that we aren't even aware of at this time, we've added an additional $6,000,000 on the revenue and expenditure side for grants, donations, anything that might come in that was unanticipated. For budget stabilization reserve for the general fund that we are budgeting to remain at 50% and that 50% that gives us kind of six months of operating revenue. Since the city's primary funding source in the general fund is sales tax, that can be a very volatile revenue source.

It's fiscally prudent to have a budget stabilization reserve of at least 50% because when we have an economic downturn, not so much if, but when we have one, this will at least give us time to react to that downturn by either making reductions to cover those expenses until those or it will give us money to take time to make those reductions over that six month period so that we are no longer overspending what we're bringing in. The capital improvement plan changes, after the April 16 work session staff went back and took looked at our notes associated with the direction we were given. Based upon the available funds, we were able to make this one change the multi use fields, we moved the $1,000,000 into FY '27, so that we can at least start planning and designing the multi use fields as appropriate. The money at least be there should that begin and then that would allow for completion of that project in FY 2028 the following year. So it's important to note that there were no other movements that we could really make with the projects due to insufficient funding for each of the five years presented.

This is just a picture you may recall when we went through the scenarios at the last meeting at the Alice Budget Work Session, we took a look, this is what we call our what if spreadsheet. This is what it now looks like based upon the decisions made. You'll see the $1,000,000 in the FY '27 column for the multi use fields with the $6,000,000 being in FY '28. The other items remain the same. We did provide a handout just of the capital improvement plan summary.

That way you can just see the summary by it's at the front of your CIP booklet that we gave you last time. This is an updated version that reflects that change on the multi use fields line item. So it's just for information. The only thing that's different about it is the multi use fields line. And this is a little hard to see on the screen.

Probably the quickest reference when you look at the graph down below each of those, you can see the wastewater utility fund. This is in the financial projections section of your workbook and the water utility fund. We wanted to show that we have deficit spending in the last two years for water and the last year for wastewater if we do not assume any rate increases beyond what's already approved. So we wanted to point that out, so you'll see the very last line of the table. On wastewater, you'll see a number in red and in the last two years for the water utility fund, you'll see two years where it's in the red.

So if we do not have any rate increases beyond what is already approved through fiscal year twenty eight, this shows the amount of the deficit in each fund. For the budget adoption, we will include increased revenues in order to have a balanced budget document. But as we approach that time when we're doing estimates, we will look at total costs and we will make sure that if we do not have a rate increase of any kind, then we will have to reduce the capital improvement plan or any other expenditure categories in each of these funds in order to not be in deficit spending. So just a quick this is a quick glance at the change in total spending for each department between FY '26 and FY '27. These totals do not include depreciation, any depreciation for those funds that have depreciation.

The budgets for FY '27 do reflect carry forwards, which means again there's one time expenses in that number caused by timing issues in FY '26 spending. So any items not received items meaning services or supplies by June 30 have to be budgeted and spent in FY 2027. In your booklet, you're going to see the department details in that. You'll see the line items and the comparisons to the prior year. And then we did just include a slide. Here's what each of

the

departments summaries looks like. We are showing you historically what is on what has happened in this each department. We compare actual budget for FY 2025. We do we compare what we're estimating for FY 2026 to the budget for FY 2026 and then you can quickly compare FY 2026 and 2027. Below that is a graphical representation showing the categories where the expenditures occur.

And then this one, it's at the very bottom and there's only one line, but it's important we try to highlight any items where you might look at this and say why is that going up so much. Like in police department for the increase in personnel costs, we are adding those four positions and the reclassification. So that you'll see is listed down under the budget variance section so that you can hopefully we can help you quickly identify why some number may be changing more than other numbers. You'll find these for each of the departments. I did want to take a moment again, we talked about it especially at the council planning session but for any of the community members who perhaps did not hear about it or anyone else who might be interested.

It's important that people understand what the expenditure limitation is. It's required by state constitution and the purpose when it was created was to control local revenue spending and to cap any future increases allowing for an increase in inflation and population growth only. So it's important to note that it does not account for broader economic growth and as it did for us, it can lead to accumulating excess fund balance. In 2018, the city had its had a ballot measure and the citizens voted to increase and permanently adjust our expenditure limitation cap. Then so starting with fiscal year twenty eighteen-twenty nineteen, we take that new higher number and we apply the inflation and population growth to create the new expenditure cap.

Again, it's important to note, we started accumulating before that vote, a lot of fund balance. We had over $40,000,000 in fund balance that have been accumulated because we couldn't spend it. We had the money, but we couldn't spend it due to this expenditure limitation. During the pandemic, at first when we were in the budget process, we had no idea what the impact was going to be. We assumed there would be a loss of revenues.

We're one of the very few cities probably in the nation that actually increased our revenues versus decreasing our revenues, which helped. But then again, once again, our revenues were greater than being increased by just population and inflation. So again, the expenditure limitation truly does limit what we would like to do even though we're bringing in the additional revenues without increasing taxes. So again, the primary drivers revenue growth outpaced inflation and population limits. We accumulated excess fund balance which caused us to defer much of our maintenance and replacement of buildings and vehicles and equipment.

And then the result again, since then, we've been able to address those deferred needs. So we have been spending more than what someone might think might be normal because we had a lot of deferred maintenance issues that needed to be addressed that were becoming critical and we've been tackling those each year since that time to try and at least get caught up. We're not caught up, but we are we have at least made a lot of progress toward that. So where are we now for the official budgeted or I should say audited numbers for fiscal year twenty five, we were $32,000,000 below the limit. And it's important that we stay below the limit.

When we budgeted, we thought we would be right at the limit. But we tend to mostly due to capital improvement plan projects. We tend to spend less than what we budgeted just because of we're not able to complete projects or receive items by the June 30 cut off. So we're able to stay under the limit, that's one of the main reasons. We don't want to go over it because we could incur state penalties and they could actually hold our revenue until we're back under the limit.

So as we look ahead, we may have to start looking at does our base limit need to be increased again and when would that be? Fortunately, we've got a little bit of room. It could be in a few years though, it could be in five or eight years. Spending less than what we're budgeting is a definite help as well as there is an allowance in the calculation for revenue carry forwards. There are certain eligible carry forward revenue that we can exclude from the limit.

So the amount of the excess that we have been able to use actually changes the base limit so that we're not exceeding it. We actually have accumulated a carry forward amount of probably 40,000,000 to $50,000,000 So that gives us for lack of a better word, a little bit of cushion at least to do some planning. When do we need to, will we start hitting that limit again and do we need to have another look at increasing our base limit. One thing I did want to note, we talk about expenditure carry forwards quite often during a lot of things that we do, meetings, council agenda items. Those are not the same as the revenue carry forwards for the expenditure limitation calculation.

So they are two different carry forward items. And then this is identical to what was presented in April, so it's really more for the community. If they're watching or want to take a look at this. The vehicle license taxes are funds that we receive from the state. This is a five year period.

It shows that we our total vehicle license tax that we receive from the state, a little over $5,000,000 right now. And then automatically there is 20% of that, about $1,000,000 that we dedicate to transferring to CIP or transferring over to for street projects, street fund or street projects within the CIP or within operating if possible. And then over the past few years, we have been transferring additional general fund dollars. Some of that accumulated fund balance, we have transferred over and dedicated it specifically to street improvements and replacements. It's important to note that this is just the revenues that are being reflected on this table.

There are no dollars in FY twenty seven additional general fund line. However, there are street projects in FY '27 in future years. So this isn't the expenditure side, it's just the revenue side. Enough of these additionally transferred funds have accumulated that we're still carrying these funds over. Some of the street projects for FY '27 will be from the carry forward.

We weren't able to complete all of those such as a coma and the one and I think Cairo coming up in FY '27. So we have enough money to continue street projects at a level where we can make progress and so there was no additional transfer for FY '27. However, when you look at the CIP summaries and those worksheets, you're going to see that in future years, I think in FY '31, we are going to transfer an additional $2,000,000 but we will still have big street projects going on such as Kiowa Boulevard in FY 2028 and 2029. So don't let that FY 2026, twenty seven zero amount for additional make you think that we're not putting money into streets, we are and we are doing a lot of street projects. This is just a graphical representation of everything I just talked about.

So that's just at a glance you can see how much General Fund is transferred in the blue and then compared to the total VLT received from the state. During the last budget work session, a request for some full time equivalent information was made or for positions. Staff prepared this summary to show the changes in positions over that timeframe. We did have another handout that we provided you where you're going to see on the first page, you're going to see this summary of the positions added and modified for those four years so that you can at least understand or have an explanation for why the numbers changed. But what we also did was add the list of all of these budgeted full time positions by department as an attachment.

You'll see the five years listed, you'll see the number of FTEs in each column. It's important to note that there are situations where the FTE count may go up in one department due to a shift in FTEs from another department or shift between divisions within a department. So even though you might see a number go up on a line, it's probably there are some where it's coming down as well. You're going to see like in the final FY twenty six year listed on the positions by department, you're going to see some that are at zero and that's because that position no longer exists with that title. Because other changes that include, we converted some part time positions to full time positions.

We created positions for some services previously outsourced to a third party such as custodial services. So that was an increase in FTEs, but there was a decrease on the services and supply side to help pay for that. Other changes are title changes as I briefly mentioned. You may see a position in one year that shows a zero count because the title changed for that position. And then you'll see the new title with a one there.

So we didn't add positions, we just there was a reclassification and title change and so we just properly reflect it and have a good audit trail to show the changes by you'll see something becoming a one and the other becoming a zero. And then overall, we did take a look at prior to the Great Recession before around 2009, which was just prior to that Great Recession when there were significant layoffs and reductions, we are actually four positions less than we were in 2009, which just information to throw out there for comparison purposes. So the next steps, the final decisions made by council today will result in us returning with the tentative budget at the first meeting in June. At the same time, we'll be adopting the five year CIP. And then at the second meeting in June, we will adopt the final budget and then in July we adopt the property tax levies.

And with that, we'll open it up for discussion and questions.

Thank you, Ms. Olson. Thank you for the presentation and the review of the process that we've been going through for the last several months. Thank you to all the staff that has put together so much effort to bring this all forward. Are there questions or comments from members of the council? Yes, Council Member Moses?

I just I want to start by thanking Jill and your team. You guys do a great job at this. I really appreciated Slides five and six, just the kind of the recap slides. I've said this before, one of the most important things you can do when you are creating your budget is knowing exactly how much you're going to be getting and what your revenues are going to do. And your crystal ball is pretty spot on.

And I just want to commend you and your team. I'd say out of the $12,000,000 over underestimation, the $12,000,000 variances, 11,500,000 of it was because of just preparing for the winning the lottery essentially. So I appreciate you. It really feels good being able to know that if you say that this is what we're going to end up having for this year that we can trust that that's what we're going to get pretty close to. I really, really appreciate that. I think you have a very conservative nature when it comes to that respect, and I just want you to know how much I appreciate it.

Thank you.

Moving on.

I

don't think much has changed for me from last session to this session. I would say the only thing that I wanted to bring up today and potentially talk about is I think we missed an opportunity, to help some of our other families. The families that don't do sports, the families that have younger kids or stuff like that. And so I look at the splash pad on the budget, and it's not funded. We say if you can go get a grant, yes, you can spend it.

But that's kind of like hoping to win the lottery. I mean, if we're all kind of honest with yourselves up here, it's just never it's not going to happen. I think if we were to fund it, I think we'd have a better opportunity of finding those grants. Grant people want to know that you're serious and that there's community buy in and all of that good stuff. So I think if we fund it, we'd have a better opportunity of finding grants.

I'd really like to push that and see if there's something we can do from a budgetary standpoint. I know at the airport, we're looking at cost savings with airport stuff, with how we do the thing. I think there's lots of little things that we can do, slide things around, to be able to make it happen. I'm more or I mean, I have ideas. I think the arts in downtown district is completely necessary, fact that we're putting money towards that.

In fact, I even literally sat in a downtown association meeting, and this wasn't the consensus of the Board, so I'm not don't let me represent it that way. But there were people on that Board that says, no, no, no, we don't want the city money. Well, let us come figure that out. I don't know. I I want to prioritize the families. I want to prioritize the kids. And if there's a way to make that happen, Mr. Knudson, I'd I'd really like you maybe some of your feedback or input of things we can do to get it done. But, yeah, I think it's an opportunity miss not putting it in there. I think we did a great service to our the kids who play sports.

I just like to I like to get the kids who don't. And so that's my ask of the rest of my colleagues and of course of you and your team, Mr. Knudson.

Thank you, Councilmember Moses. During our last budget work session, we had a spreadsheet that came up on the screen and we were able to move numbers around. And we had that discussion at that time. So Mr. Knutson, do you have any ideas if that was the direction council wanted to go to fund the Splash Pad in are you saying in year one then, Council Member Moses?

Wherever we think we can do it, if we can move some things around. But yes, sooner I mean sooner is always better. But I understand the budget. I understand we got to do what we can do.

Mr. Cranutsen?

Yes. Mayor, Council Member Moses, certainly if that's the direction in the will of the council, staff will go to the drawing board and identify a plan to make that happen. There are a few projects that we could consider to take a look at. I've had conversations with Chief Sterling in PD and there was a request there for a police storage facility. We have some equipment that we want to get out of the sun, but we have we can have an alternate plan if that's the will of the council.

You mentioned with grants and so forth, we are trying to find grants. A lot of those grants that you'll identify for like a splash pad or something along these lines would require some type of a match. So zero funding in that category hinders us to that respect. But certainly conversation amongst council has to take place and staff is listening intently.

Thank you, Mr. Knutson. Council Member Moses, do you have any other questions about the operating budget, any other components and we'll just make our way down the dice to all of the council members for comment?

No, I mean, I know everything else was pretty straightforward, pretty close to what we talked about at the last meeting. That's I only wanted to talk about the changes from last meeting to this and if I have any comments afterwards, I'll make them, but I'm good. Thank you.

Thank you, Councilmember Moses. Councilmember Koch?

No, I don't. And I can be totally in support of that splash pad. Were some comments made after our last meeting that I heard from some of the people that had come up to me just mentioning that how important they felt the splash pad was. So being open to hearing what that looks like. And then thank you Jill and the rest of the staff. And at this point, don't have any major questions or concerns. But if I do, I'll let

you know. Thank you, Councilmember Koch. Councilmember Berlin?

The only question I have is our thoughts on the airport hangars. Since on Tuesday, we heard about the audit, is that something we still want to invest in on the hangers ourselves or if we want to look for outside partnerships with that? I'm just from that audit because we got that information. I was just wondering if we are looking at that at all.

Mayor, Councilmember Lin, certainly you'll see that identified within the CIP for hangar development. We're looking at a couple of different options, couple of different scenarios. And honestly, what you see in the CIP is probably plan C or D. Council directed staff to take a look at additional hangars. And my takeaway after the planning session was don't build three of them, build 30 of them.

So we want to put a couple of different plans in place to make that happen. The ideal situation, Mr. Turner, our airport manager is confident that with improvements that took place with the infrastructure and the taxiways on that area that we can bring in somebody to partner with a private investment to make that happen. But what you're seeing reflected within the CIP is if we can't find a partner, then what do we do? And so that's what it is. So the hope is and the thought is that we wouldn't spend any of those dollars on Hanger. We'd find a private partner or a partner in the private sector.

And then I remember speaking privately to Mr. Klowski and to Vigette, and I don't think Vigette's here today, at our retreat about the splash pads, the ADA accessible improvements and all that grant stuff. And when I spoke to them at the retreat, they were 80% to 90% for sure we were going to get those. So I don't know where this conversation now is coming. It's saying that we have to match and that it's winning the lottery to get it because I remember having that conversation at the retreat that it was pretty much a yes.

Mr. Mayor, Councilmember Lynn, we were successful in receiving a slip grant for the ADA accessible parking lot as well as the improvements to the infrastructure and the bathrooms for the potential of receiving a grant for the splash pad. At this point in time, grants have become a little bit more difficult to receive, especially if pertaining to grants that we would potentially utilize for this site such as with the National Parks Associate Department at the national level at the federal level, excuse me. We've struggled to get additional funding as it pertains to Main Street Commons. Those grants are getting a lot harder to receive at this point in time and the national level and state level aren't really doing a great job of communicating with one another as it pertains to grant funding moving forward.

So I'm not confident at this point in time that we would be successful at receiving your rent.

So at that retreat, we hadn't even applied for that grant when we had I'm just trying to clarify this because I was assuming that we had applied for that grant already because when I'm hearing 80% to 90% chance we're getting it we just thought 89 chance we were going to get it because that kind of was false information then.

Mr. Mayor, Councilmember Lim, no not false information. What we were waiting on to be able to apply for the splash pad was the additional money from Main Street Commons. So we applied for an additional grant of $500,000 from Main Street Commons. Once that project was completed and those grant dollars were received, we were then going to utilize that grant opportunity to potentially apply for the splash pad. At this point in time, we haven't received any additional funding for the Main Street Commons, the 500,000 and it's very unlikely that we will. So until that point we can't.

Is that the same grant money that we could have possibly used if we would got it to reapply for the second pool too?

Mr. Mayor, Council Member Lin, that is correct.

Mayor and Council Member Lin, Mr. Kozlovky, if you want to talk about we're talking about there is two different projects happening, right. So the first project that we were successful in receiving grant dollars to the tune of almost $1,000,000 was for the ADA improvements at Rory Park. That's the parking lot, the infrastructure and additional restrooms that were essentially teeing up the opportunity. There were great improvements regardless, but they would also allow for counsel to consider a splash pad at that location with our state requirements, state laws that require infrastructure to be in place surrounding that area.

So we were successful with $1,000,000 grant for the ADA improvements at Ed Rodeo Park and then at that time pursuing the possibility of a grant for Splash Pad. I just want to put that out there. Is that your recollection, Mr. Kozlowski?

Yes, it is. And that part of funding that we received for the ADA and they're doing about $1,000,000 with Slif funding.

And it was my recollection we were having these discussions during the budget work session last meeting when we learned about the splash pad component is that it's not it wasn't we choose Main Street Commons over splash pad. It's just so you can have one application from this funding source at a time. Is that?

Mr. Mayor, that is correct. It's simply based off of timing.

Can I ask one question, So I guess, this splash pad, we've had the pool in our budget longer than we've had the splash pad in our budget? If we were gonna get that grant, why wouldn't we if we were, which you're assuming we're not going to, why wouldn't we have put that towards the pool? Why wouldn't we have done that? Why would we even have thought to put it towards the splash pad first?

Mr. Mayor, Council Member Lim, during that process, those funds that we were potentially going to apply for to receive additional funding for whether it was a pool or a splash pad was currently in process for Main Street Commons which prevented us from applying for any additional grant. So the next step would have been depending on design and where we were at in the timeframe as far as what made sense for applying through the National Parks and State Parks Association that would have the best chance of getting approved. Then we would that's how we would determine moving forward based off of that.

I feel like there's some lacking of communication in between the retreat and today, but okay.

Do you have any other questions, Councilman Lin on the operating budget or any other components of the budget? Okay. And then we'll to Councilman Campbell, then we'll come to Vice Mayor Diaz and then I'll have comments. So Councilman Campbell.

I did share with everybody on the council. Did anybody else see this report that I had prior to yesterday or prior to today. I'm just asking my council members, did anybody see this report other than me? I got it yesterday. Did you guys get this report before me? Michelle? No? Nobody has seen this report until I gave I have asked missus Williams to forward it to you. This is very concerning to me. This report was a really great water report back in 2023.

They did it was really amazing. It was $110,000 it cost our taxpayers. And it came in with a satellite. They oversee a certain section, only 10% of our underground infrastructure to look for underground water leaks. Many of you in this room are hearing rumors that are going around that the Campbells don't care about the youth.

We only care about streets and we only care about water. It's because when we were working with the Public Works Department, my employees worked with them for decades. They came here in 1974. For most of you that don't know, mean my family came here in 1965. 1974, they started Campbell Ready Mix and we're doing grading in this community.

We have an outstanding relationship and always have with Lake Havasu City Public Works. We were the ones in the middle of the night, last minute calls, whatever we can do. We used our loaders to support streets when it got flooded, drainage. And I don't think I my husband and I were going through it when the rumors were flying that the Campbells don't care about youth in this community. And if we don't, they won't do a pool.

They won't do a splash pad because they only care about roads. They only want to pad their pocketbooks. I've heard this rumor. People are calling me over and over and over telling me this story. And it's very disturbing to me and my family because the reason why I ran for City Council is I knew we had massive infrastructure issues. I know we have main water mains that lead to the refuge that have broken so many times that if they break too many more times, the refuge isn't conserved. You know what I've been told? Who cares about those rich people? I'm like, I don't care if you're poor. I don't care if you're rich.

You all deserve water and you all deserve safe roads. Period. So again, I've been up here for five years and when they told me that they were going to bring this report to the table I was ecstatic. 10% of our roads were going to be our infrastructure was going to be examined. I kept asking what happened to that report, that $110,000 report, where did it go?

They said, oh, it wasn't worth the paper it was written on. Oh, it was way worse. They didn't really want anybody to know that while we're building other things in our community. I heard a lot of rumors, maybe rumors. But finally, I said I need this report before my family continues to get slandered that I don't care about pools and I don't care about fields and I don't care about water parks. I care about our water. I care about our roads. If we don't have water, we're not watering fields. We're not nothing. We're not.

So again, if you've heard we don't care about the community, that's a blatant lie. So I did get the report. It's out there on the counter if you guys would like to see it. I did receive it. It was finalized in 2023. For three years, this data has been out there. When I got it the other day, was devastated. I knew it was bad, but I didn't know it was this bad. A total of 72. So only 10% of our city was done.

So they did just a little site study. 10% of the city was done. 72 leaks were found pursuant to the satellite directed fields. 27 leaks were on the utility side and 45 leaks were on the customer side, 11 of which are considered utility lost. The water loss value identified $334,000 per year of water loss. The total revenue loss volume found in this program was 85,700,000 gallons per year. How do you guys feel about that right now? If you're in my seat, are you just okay? Let's just keep going. Nothing to see here.

Moving on, it says sixty seven sixty seven of the 72 leaks found haven't even surfaced. They're leaking. I remember back in 2020 when I decided to run for council is because my family was coming home from the public works department and saying, there are two leaks that are gonna be a massive sinkhole in this town if we don't do something. But we are more important other capital improvements seem more important. It's election time. Of course. Of course, we're gonna do splash pads and fields and we're gonna give you everything you want because it's election time. Guess what? I didn't get here in time. Do you remember those two massive sinkholes?

They could have killed somebody. They could have killed somebody. So I I ask you to please look at these reports. I ask you, is water important to you? I ask you how many millions of acre feet have we lost if we've only studied 10%?

Then I just ask, why aren't we continuing to do this? They proved in four months just the value of water lost to utility rates was enough to cover the $110,000 to do the report. This report, as you get it on the way out, states, we encourage your city to continue to do this. And I'm going to leave you with this percentage rate. Again, I'm very upset because for three years, they knew about this. For five years, I don't even want to say I told you so. That's the only reason why I ran. But in five so basically, here it goes. What did we find? The U.

S. Average of leaks per day is two zero nine I mean, in 02/2018 was 1.3. Lake Havasu's average, 2.4, A comparison of an 85 increase. Miles per day of leaks. The national average, 3.9 per leak, 3.9 miles before they hit a leak.

Lake Havasu City, 1.4 miles, an increase of 36%. The average so basically, the comparison, Lake Havasu City has more leaks, is 411% higher than the national average. That's huge. That's embarrassing. That's sad. But because of election yeah. I would love to hear from the public works department since they've got this report. What have they done? What are they gonna do? How are we going to resolve this issue?

Please tell me you have a fantastic plan so we can afford it all.

No, I do not have a plan. Have something that's already being implemented.

Okay. What's that?

I'm already doing this.

Okay.

So as most of you are aware, my employment is not when this happened, I'm not a part of the support of Reddit report.

I've been

a part of other projects where they use either aerial analysis via balloons or whatever to find leaks, whether it's wet or not. Interesting tool. It can be used in a lot of communities to find overwatering and such. It's nice. Our community is a little different from the standpoint of our soil sucks up water very fast. And we're all aware of it. We've been here for monsoons, seen an inch of water drop and be gone in two hours. Like we just have a different world. Public Works Department and the Water Division specifically have focused on making so many technology jumps to be able to address these issues as proactively as we can. We are fighting a losing battle.

We've got an aging infrastructure that was not funded for repairs as any city is pretty guilty of, okay? So this not this one's not specific to Lake Havasu City. We all have sort of this infrastructure we're trying to catch up to that was built fifty years ago. We've pivoted from the standpoint of this particular report to focus on data driven projects. And in one of those things as you guys have already approved our smart meter program. Over the past year or so, we're going to say we've installed just about 6,000 of these smart meters out there, these advanced infrastructure. We've investigated 1,000 leaks as a result of that program already. It's actually closer to 1,300, but I don't want to brag too much because it's essentially one guy out there checking these, some of them physically. We performed in the neighborhood of 50 to 60 residential audits already. We do commercial audits.

We are now investigating the data. This is just in the meter program. So this report talks about things past the meter. These are actually not revenue loss things. They are things that we are aware that we're gathering money for but efficiencies. We're very aware of that. The other part that we've done is we've partnered with the company. It's an AI platform for determining where your water main breaks are. We're actually it was close to being done with the project. We're no longer planning projects because of things we think or feel.

It's because the data tells us that's where it's happening. So we look at not only the age of pipe, the last time a break happened, where those breaks happened, what kind of demand is on that line and we have a full project profile of what we need to address based on that data. So we know from anecdotal evidence the four inches PVC is up and down our cul de sacs, not really good. They whatever the reason is they just boy a temperature change they pop. And this is the time of year where we start seeing a lot of those four inch cul de sacs are blowing out on us and we go and fix them.

And when we ran the AI platform it found the same thing. And we're looking at going okay that's where we need to target it. We have to be fiscally responsible too and look at projects like when a coma was coming through for paving project, we knew we had multiple breaks based on our work order history. We said, hey, we see this other project coming up. We've got a bunch of work orders. We looked at our modeling. We looked at our data from breaks and said we need to get these repairs done. Hence the area by the office for example right now is getting taken care of. We knew we had issues, we knew it was being paid, we got ahead of it. So the report is an interesting tool.

I've read through there and it's not great to be on the wrong side of national averages. Can We blame heat, we can blame environment, we can do a lot of those kinds of things or we can take the approach we have. We're trying to gather as much data as we can. We're looking at all the available information we have. Once we have the AI model in the Water Master Plan, there's actually already a water model that addresses what's known as the risk of a pipe failure. It makes a combination of the consequence of failure and the likelihood of failure of a pipe. What happens if a pipe in front of

the hospital breaks? That is a

giant consequence of failure.

Turns out we've replaced that pipe, so

its likelihood of failure is very, very small. We've been to that desktop exercise. Now we're going to have the AI exercise plus we have our metering data and a new project that we're just getting started on. So we don't have a lot of information on is our meter provider is offering us pressure sensors to be putting in front of residential homes that allow us to monitor pressure throughout the system as well.

We're going try that as a test.

It is a little side project we're working on. It may or may not work out. But at least we're

going be have data and we'll be able

to make better decisions on the data.

This is interesting and a lot

of those leaks ended up being addressed very, very quickly. So that part is good. The thing that was very disappointing is there's only two mains identified in that project. Mains are where our main non revenue water is. We are in the wrong side of the national average for the unaccounted water loss. However, we've been installing new meters as a result of that and we know where that water is going. Now we're just trying to chase it down. Again with our soils and climate it's a little hard to find that stuff but we are actively looking for it and developing programs to address that.

I do want to say, how long have you been working for us?

August will be three years. I've been in public works I think for two years at this point.

And I appreciate you. And I do. I trust you. I appreciate you. I believe you're an ally for water. I can see the passion in you right here, right now. But it is is true that we my husband said the same thing. Our soil just absorbs water. It just disappears. It you know, you could dump water on it like you said, and it's gonna be gone like that. So for so when they actually do surface, you gotta understand how long that's been leaking. And we have water. So, of course, you can say it's election year. I can say we're wasting a bunch of water. So that sounds just about as bad as I don't care for kids.

So but we don't want to I don't care about election. If you elect me, you do. If you don't, you don't. Let's put great policies in place and you've already started it. I do love the water meter change that we did. That was brilliant. Thank you, Anthony, for your help with that and everybody that helped to get that grant funding for that. I appreciate that. We the next step slide and I do see here that you have a lot of capital improvement. That's good.

But the other big, big the only red we see on this whole budget is water and wastewater. We're going upside down every year. You're already saying we're falling behind. Not to mention the amount of water we're losing. So this data, the other data we I understand that you guys are doing GIIS mapping.

Haven't I brought that up from day one? So all I'm saying is I didn't come here as a layman. I came here with a lot of knowledge and a passion for this community like no other to try and be a good advocate. And when you just get pushed back and not getting this report for three years without having this discussion has made I've only gotten rumors. I've gotten misinformation and rumors, which is no good. But I trust you. And I think between the two of us and the council up here, we'll do good work. But man, it needs to be a top priority in this community.

Okay. We are very appreciative of the council's dedicated budget to water main replacements and we're trying to be as efficient and effective with those dollars. It is the millions and millions of dollars that have been put towards that. And you guys see it right now because it's happening. It's not a project that's behind or anything that's actually ahead. We've added every time we've had extra room and we are finding as best we can the places that are in the worst condition and addressing them.

Thank you. Mayor and Councilor Campbell, thank you Mr. Kellett. We are very, very lucky to have Tim with us overseas not just water but on the sewer side. I serves as our Deputy Public Works Director and is doing some really great things for us. Put things in perspective a little bit, Tim you kind of hinted at it in terms of the we're catching up with deferred maintenance. If you go back from like 2010 to 2020 and those are the timeframe, we're looking at ten to twelve years where there was no rate increases for water and sewer. The smart thing to do at that time is just 1% or 2% increase. So you're staying up with the cost of projects and inflation and whatever that's there. The city at that time did not do any of those things.

The investment into water and sewer infrastructure during that timeframe was also, in my opinion, minimal. The investment we put into water mains, sewer mains and the like were nothing like you're seeing the city invest into our infrastructure in the last few years. In the proposed budget that's in front of council right now, you'll see for next year $4,500,000 in water main replacement. We have over four ten miles of water mains out there.

Close to 800 total water pipeline if you include mains and service lines.

And service lines. 800 miles and we're playing catch up with the infrastructure that we have. In large part, if you go back ten, twenty years, the infrastructure was brand new in relation. So not a lot of investment was being made. Now is the time for us to make that investment. We've been doing it at Tim's and Mr. Foggins with their leadership. And you'll see that $4,500,000 in just water main replacement is necessary. The reason you're seeing red on those pages is because I asked the team to put red on those pages. Because the council needs to be aware that if we don't address the rates in the next two years.

So this is not like we need to make a decision today or even in the next necessarily in the next twelve months. But counsel needs to know that if no action is taken on the Water Fund or the Sewer Fund, then we won't have the money needed to keep up with the maintenance of our infrastructure. That's why those pages are red. It's not because we're going broke or mismanaged funds or any of the rest. I'm sending a message to counsel that we need to look at our water fund and our sewer fund over the course of the next three years. And we have to make plans now so that we can continue the investment that's needed in our community.

Thank you, Mr. Knutson and Mr. Keller. When I got this report yesterday, I'm going off of my memory. And so I believe that this was grant funded and if we take ourselves back to the time that this was done three point five years ago or whatnot, grant funding was more available. And so at the time, we did not have our full rates study implemented that the council implemented. And so we are looking at all alternatives of what we could do. So the report like this may have allowed for additional grant opportunities to help us with our water main replacement program. And when I look at this, there's great data in here and so I don't want to take away from that data. But what does give me a little concern is recommendation.

The very first line of the recommendation says, it's recommended that Lake Havasu continues to pursue leak detection program with this company that provided it and that the leak continues to rise with non servicing leaks and then furthermore renewing this program with Asterisk. I mean it's really a sales tool for this company to continue an annual subscription for that. Again, I'm not trying to take away from the data. If it would have provided grant opportunities for us, would have been fantastic. In addition to the $4,500,000 in the budget before us today for water main replacement, we have $3,000,000 in our current budget, 3,000,000 prior.

And again, to reiterate Mr. Knudson's comments, we have currently an adopted five year rate study that the council adopted. So where you're starting to see the red is when our five year rate study that's implemented right now or approved by council goes away. So it's just it's an item so that we know that we're going to have to address and continue to invest in it. I mean this council has been very forward thinking when it comes to water, water efficiency. We've had lots of discussions about it and we need to continue to have them and we need to continue to invest in that and the budget in front of us does have that ability to do that. Okay,

can I continue? Please. All right.

So

we hired a company and we decided to give them $110,000 but then we're saying now the recommendation is that we only did 10% and you're 411% below national average I would continue to do the rest of the city and we're here to support you. We've had tons of services IT services that have said the same exact verbiage. So I'm not going to debate with you today. I'm just going to continue to stick to my facts. Now since you're here, would you please answer, I see that we have $3,600,000 in an injection well. Injection wells, I love injection wells. There's been rumors, but now you're right in front of me, I get to talk to you. That's great. Injection wells are getting after like five or six years, they're getting infiltrated. They're like sponges.

They only take so much water and then they might slow down for a while. And that would be over at the North Side, right? Correct. 3,600,000

If I may, what page are you on,

Council Member Kimmel? I'm on the budget. It says wastewater. Page 12. Oh, yeah, let me I found it before I have it written on notes. Yeah, let's go to wastewater. Yeah, wait. Yeah, is it? Perfect. Thank you. Does it say injection wells? I read it. Wastewater, it should be over here. What does it say? Capital. It must be on a different slide. But it was just right in front of us somewhere. So basically, is it the CIP?

Called 10.

So just to the CIP, you will see that it says $3,600,000.

It's well 10.

I'm not making this up. It's here in documentation. And that is for Northside, correct?

Yes. That's the only place we have an injection Vados injection wells.

So when I heard the situation about Fields, and I was immediately approached by Jared Ports, who is the main person that's really revitalizing the shops of Havasu, doing an outstanding job. He said, do you know about oh, and and missus Bess Carlton also brought me up and said that there was several different sites for ball fields. One is Northside. One is they're now talking about Buena Vista, which is a school district, which is in a neighborhood. And so I didn't even want to get into the field.

I have enough hats right now between roads and infrastructure and apprenticeship programs and things that I'm doing that I love to do that I'm like, I'm going to stay out of this field conversation. But when I get somebody contacting me and telling me about this north site, that it was always identified that that would be an outstanding place to put fields or sports facilities because it's right next to our water sewer treatment plant. And not only that, because when you're in a sandier area, you can filtrate a lot of affluent water into a field at night because it absorbs very, very quickly. Like you said, our soil just sucks it up, sponges it up, yeah. And why when we had our agreement with, I want to call it the refuge, but now it's Iron Horse, that it was so great to have that agreement with them because they sat on kind of the same soil, which is really sandy.

And when you just filtrate it, it's just gone. So it's a win win. We get rid of affluent and we're getting a beautiful grassy golf course in the meantime. So what I'm getting at is this is a no brainer for me that this $3,600,000 is sitting there for more injection wells that what is the time I guess my question to you is what is the timeframe that you start to see that what is the word you're the

Bounding is the word I believe you're looking

for It when you inject

really depends on your soil conditions. But I will say currently when we constructed both Well 8 And 9, we are expecting to get an additional like 250,000 gallons per day potentially out of each. Those have actually exceeded expectations. So any mounting effect we're currently not seeing with our new wells. We've had other wells that have they haven't fouled essentially the machinery on the inside of it needs to be cleaned. So the wells themselves actually work fine. So there was a thought that there was a mounting going on. It turns out our injection wells just needed to be cleaned and maintained. So we pulled them out, cleaned them. They're working fine. So we're actually able to inject close to 1,500,000 gallons per day and currently are seeing no mounting effects at all.

Well, isn't that good facts? Those are good facts. I like that. I appreciate

that.

We are though in full terms here. We have we're in the middle and almost complete with designing well 10. So it will be on the shelf ready to go in case we want to pull that trigger and move forward. But we are looking at a resource portfolio where we have our water going, our effluent water. Keep in mind, you guys have already seen in the capital project the parks project where we're going be watering the parks with the effluent water as well. Is going to change where those resources are needed and going And where you need to sort of complete the parks project before we were about building Well 10.

Would you say that it'd be more beneficial to be using the affluent on a ball field other than using potable water in the middle of a neighborhood?

From a wastewater operator, anytime I can dispose of water in an efficient and effective manner, I'm very happy about that.

Well, I like that. And Jared will be happy that you just said that too. Well, here's the other thing that he had mentioned to me and we have a meeting Wednesday, right? Yeah, next week, where he said that he has been considering an overlay district for quite a while. He really wants those fields out there. Why does he want those fields out there? Because he feels it will generate revenue to the shops. If you generate revenue to the shops, happens? We all get more sales tax revenue. And as a mother, for everybody, the one Nancy that doesn't like kids, mom, I have three kids that were all born and raised here.

I have seven grandkids that are all living in this community. And trust me, it takes a village to get them in every sports, including I'm excited that two of my granddaughters just are bringing home the championship for our Sonic team, our cheerleading team. Just won Nationals. Can you believe that? That's awesome. So in the meantime, what I'm getting at is when you have three kids, it's not uncommon. Somebody is dropping off Johnny over here. Somebody is over here. Somebody is over there. I'm going to zip down to Walmart and pick up some stuff.

We'll meet you at Buffalo Wild Wings and have lunch. And then I'm going one wants to go to the trampoline park. The other one wants to go to the movies. And then so to me, I can't even believe that we're having a discussion on fields about Buena Vista. When we have this massive economic development force and it's a win win and we can use it for infrastructure, those are the conversations I appreciate. And I love your honesty for it. So the council up here, I see that we have $1,000,000 set aside for fields. And I'm okay with that, but I would like further conversations, a lot of them. Because if we have a whole Shops of Havasu that has that are willing to put an overlay district. And Mr.

Moses, I would love to hear more because your location has an overlay district kind of the same. They're thinking about doing that all over all of that in return to continue to build upon the fields and sports facility where it was considered to be one of our park master park plan sites. So those conversations are great. And then some people will say I'm going to be greedy right now That, yes, I am building 1,000 home workforce housing development in Havasu Heights. That is a nine minute drive.

So I am going to be selfish that the workforce housing project that I'm doing out there may be 1,000 homes, if not more of workforce, that they get fields on their side of town. You have Sarapark. You have a workforce housing development. We have a water sewer treatment plant that we can facilitate and use. I really want to see those conversations. I think that's a well laid out plan. So there's that. So keep the $1,000,000 in there to have further conversations. And it's the big debate. Does the community want it over on North Side?

Or do they want it on Buena Vista? That is up to you. But we don't need to be putting all that money in there now. And I was just saying in the $6,000,000 the $7,000,000 we're not just going to just hopefully pick one location and be one and done. I hope we have further conversation. I hope we all can do that.

And Council Member Campbell, again, we're in the budget. This is the high level. This is going to allow us to have the opportunity to have these discussions. Any item, as you know, is going come back before council for final approval and location and where it's going to be. There's a few efforts that are in the works right now with the Parks and Recreation Master Plan is one component. And then if this budget approved is presented in front of us, the $1,000,000 is for planning and design of wherever those fields will be in this current budget year that would start in July 1. And then in the next year to build wherever that is, but those discussions will happen.

Well, what I was told just a couple of weeks ago that there was already contracts in the place for the Buena Vista and that that's what was happening and

contracts don't go in place.

I'm just telling you this is the rumors that you get and this is what starts flying and this is what cards. And so I'm over there going is that the biggest and best use for our money. And I don't remember anybody on this council directing anybody to pick Buena Vista. I didn't. I know that the staff, I know that Mr. Council Member Moses and I know that some of the school district have been talking and I'm out of those conversations and that's perfectly okay. You're not allowed you were not supposed to do that. But if I'm going be out of the conversations in front of all you, I'm going to tell you why I think North site is better and maybe we need to look at all of those options. So the 3,600,000 injection wells, that's good. I was saying because that's a great way if we're planning on doing sites over there that maybe some less injection wells because they are expensive.

They cost about $1,800,000 a piece. Okay. Now you guys understand about why I'm passionate about roads. First off another thing I'm going to say. I don't want any HERF funding or roads being paved if the infrastructure below it is not good. As much as we say we've done that, I was very shocked that we did the mill and fill on Smoke Tree When I knew good and well that that needed a full main replacement. And the way I know that again is when we were milling and filling it that night, we had a water main break right in the middle of laying asphalt. So we need we can always do better. We're learning. And I'm going to continue to advocate for good planning, great direction and what I know.

That's what I'm going to continue to do. Okay. So now let's talk about I am not for the $355,000 for bathrooms. Last I heard, maybe it's not true, that that is not even on city property. Is that true?

The bathrooms? The channel bathrooms? Yes. Yes. So the channel bathrooms have been in the CIP. I think I need to clarify because there seems to be some conversation about projects that people are the CIP budget, these have been in the budget this whole time. So fields been in the budget, second pool been in the budget, spot spent been in

the budget, channel bathrooms been in

the budget. So it was my understanding it was coming before council maybe a meeting or two ago. It was pulled because they didn't have the proper easements or right of ways, but that's on Arizona State Trust Land.

Right. Okay. So again, these are the rumors. Isn't this what we're supposed be doing? This is work that

The easement, absolutely. Yes, easement, but that's why it was pulled. And so there's money in the plan that should the easement be addressed through Arizona State Trust Lands that the bathrooms can be built as an amenity for those that use the channel.

The Arizona State Trust Land isn't the London Bridge Resort has a lease with the state?

Arizona State Trust Land owns So the they would have to have the easement. I don't have the lease. London Bridge Resort has the resort lease.

Has the lease.

Right.

Yeah. And a good example is there's a gas station here in town. They have a lease with the Arizona State to keep their bathroom there for God knows how long. And then the Indian tribes have theirs too. There's leases all the time. But we I was always told we don't build on we don't use tax dollars to build on other people's property. And I would consider that to be a lease. And I would consider that to be Lund Bridge Resorts responsibility and liability.

We're currently the tenant. And if we get an easement, we would have the easement would allow for that to always be in the city's control. The channel bathrooms, there are hundreds and hundreds of recreational walkers that use that area every single day. And then there's thousands of people that use the channel all summer. Channel bathrooms is not something that's new. The channel bathrooms has been a discussion for

And I don't like the porta potties and stuff. That's why I was okay with that. But I don't want to start to set a precedent that every time somebody owns a state trust, the city is just going to maintain it and handle it. Realistically, because thousands and thousands of people are walking by there, I'm sure the resort and the chair and everybody down there is also financially benefiting from that. So I'm just a little concerned about taxpayers having to buy bathrooms for businesses that I agree. But the porta potties, I'm not a fan of. And then the price was like $355,000 And there was a lot of things that were pulled out of that. I was surprised that it was almost going to come to us. I'm glad it was pulled out. Because I didn't really have a site plan.

There were some questions about foundations. There were questions about the septic tank underneath. There was a lot of other questions. Glad that's out of there. I mean, why don't you guys build bathrooms?

Councilmember Kimmel,

I don't like the way that you're trying to draw conclusions. So you keep talking about an election, the only person not running for an election is you.

I know.

And so let's stay focused on the work of the city and do good things based on what citizens have been asking for. So the simple question is that we don't have the easement currently and the city is working with Arizona State Trust Lands to get that. If that is to happen, then we'll become before counsel for consideration all these discussions, site plans and all the things that you're asking for. You'll You be able to see it and make a decision at that time.

Okay. But I'm saying it almost came. I saw it in my agenda package and it didn't have any of that. So let's get that we'll get that fixed. All right. The PD facility rehab Fire Station seven absolutely. That seems like a lot of money. Know but okay. Public safety storage building, I think it's very important to protect our vehicles from the heat. That is one thing that will cost us money in the long run.

The downtown arch, the fields like you've already heard me say, the downtown arch has been pushed out to '28, '29. Again, if I was to put money into infrastructure over a downtown arch, I do think our community can work closer together and get that handled. Funding for airport hangars you heard the gentleman loud and clear just the other night. It was very good where he stated that it wasn't biggest and best use that's what I heard. Wasn't biggest and best use to take this money to just one of those sites.

He said let's you so basically for all you out there that didn't hear it. He said it's very hard for it to be successful for a private business or a city to put in all the infrastructure and then build hangars and make it feasible that you get a return on investment. He said in normal situations, it's best for the community like us, the Lake Havasu City who owns the airport to go out and get grant funding from the FAA and other people to help us with the infrastructure costs in place. There are grants in place so that you can do that. And we have two locations, not just one.

There's one on each side. What is it? North and South or North and South. So to really look at minimal use, I mean best standards, I guess it was best standards, put in the basic infrastructure and hopefully we can get the grant funding through FAA to do that, which is wonderful. And then in return, you go out to the FBOs or go out to somebody else and ask them if they want to do the second part of it.

And then that's a win win for the community. So at this point, I would rather just say to keep like the $1,000,000 in there. But the reason why I'd say that is for matching grant funds. And my intention to that would be matching. I know it seems like in five years, this airport goes this way and this way and this way, and the end result is no new hangers. We know that there's no new hangers. We have a brand new FBO in there, Velocity. I've heard amazing reviews about this company and how much money they want to dump into the city, airport here and many others. We should really continue to collaborate, communicate. And Adieu, we just paid how much did we pay for that?

$27,000 for a study to find out these findings on how we can move our airport forward and that was one of them. And I totally agree with that one. So the $1,000,000 could just stay in an account while we look for grant funding and continue forward on the results of that executive summary. I would really appreciate that.

Perfect. Think Mr. Knutson addressed that earlier. So this again, this budget gives flexibility for the council to consider all of these things. I know so we're high level here. This gives us the ability to have those discussions in the future. And again, we're on I obviously can talk about the CIP projects, but also the operating budget. If you have any questions on the operating budget, which is what the focus of this council or this And work session

another thing that's really the focus of this council meeting is to give proper direction. That's why I'm being very specific about what I see. Number one, the million over here, do this, this, this. I think they're hearing I'm only one vote of the council, but I wanted everybody to be highly aware that it's not just because Councilwoman Campbell doesn't like kids and she wants all of her money in her own pocket. That's not it.

I'm here for great conversations, great planning. Let's do this on a high level, our community as a whole. I love these workshops. I know you guys don't like to hear me, but I mean I would rather do this and bring people up and hear the real facts about what's happening other than hearsay because most of you in this room know that there's a lot of rumors that sometimes fly in this business and that's not good. But I think I've covered everything I wanted to cover. Perfect.

Yes, thank you. And we do like to hear from the council. That's why we're having this work session. We want hear from all members of the council. We want to hear from the community. So we'll go to Vice Mayor Diaz, and

then I'll make some comments

and we'll open it up to the public to engage in the conversation as well. So Vice Mayor?

Yeah. Thank you. Thank you very much and thank you for your comments, Councilmember Campbell. On Slide five, Jill, can you go to Slide five? And I like that slide, but I just have a couple of questions. On the other revenues, it says we're going to be down to $2,270,000 Can you explain to people with other revenues what entails other revenues?

That's primarily the contributions and donations.

Yeah, know it's just 2.8, but added for potential donations and for out to report. So is it grants or is

that considered grants also? Yes, Vice Mayor Diaz, there was a discussion from this that said that we thought we could raise the money for the second pool or maybe the school district would be able to bring the money. So the budget had to reflect that. And so there was That's why we put it. Correct. Yes. So the budget had to reflect that because if we were able to utilize or get $2,500,000 from a grant or from the school district or from private donors, then we would have been able to use that money and actually build

the pool.

Okay, thank you. And then on the same slide on the used fee charges is down $1,075,000 Why that down? Do have any thoughts

That's on water and wastewater revenues.

Okay.

We're not meeting our projections there.

Okay, good. On slide number six, can you define the services, on define what that is? People are just I know it says $5,100,000 due to carryovers and less. But when you say services, are you talking about utility services? Is the services?

Any professional services. Our utilities are in there. But those are all the professional services, anything that's not a tangible item like a supply.

Okay. So if you actually go to our budget book that's in front of us, you can go to, I mean, 35 is administrative services, for example. I mean, it outlines utilities, services, supplies. All of that's in the detail here. And this is just a high level summary recap for us. And that's also available on the website for all of our citizens to look at as well.

And I like the thank you, Mayor. And I like the idea about the helping fund positions for the police department. I talked to police chief a couple of days ago and got some good ideas on how to utilize some of those new positions. And also we have to fund the fire department. But there was a comment made, I wanted to make sure I heard it properly. Did you say since 2009 that we have less positions than we had today?

We have less positions today than we had in 2009.

So I thought it was I've heard just the opposite. Maybe city manager, you can answer this question. I thought we had a lot more new positions with increased salary also.

If you

look at the Vice Mayor Dia as mayor, if you look at the FTEs for the city and you compare it back in the 2000s, there were we have less employees today than we did at that timeframe.

To the tune of four. So we have four less employees today than we did projected for this budget should it be approved four less today than we did in 2009.

Just wanted to get that out in the record, just clarification. Let's see. Number I had a question on 10. No, that's good. We answered that one. Number 19, I had a question on '19 for some reason. Let's see what that is.

So

on this one, am I right to say that it's about $1,000,000 a mile when we repair roads? Is that a good estimate? Mr. Foggins, do want to answer that?

Jim, Mr. Kellett, if it's okay with you, Mayor and Vice Mayor, I'll bring Mr. Kellett up. And I don't see Bill Young, who's our expert, but I know Tim is very well versed.

The question was about repair of the roads?

Just repair of the road. If we have to do mill and fill or whatever, just you did two miles of Jamaica, and it was $2,000,000 That's where I got that figure.

Yes. You're in the ballpark. It really depends on what your preconditions are more than anything, what how large the road is, right? So Jamaica is obviously one of our wider roads. So you would need to say that's a five lane road at $2,000,000 two mile. That's where you get that. So you have to kind of be careful for doing little laterals and stuff. Sometimes your mobilization costs Generally, start shooting it it works out well. It turns out it kind of works in the water industry too. It's about $1,000,000 a mile to do a new pipe and put the road back to a somewhat usable condition. So that's about right. So

we on that have 800 and something lane miles in Lake Havasu, correct? So this slide, we are just woefully underfunded with these. I mean the HEERF funds and the BLT taxes and so forth just don't even barely put a dent in what we need to do. So I think as we prioritize the budget, we have to look at that because I don't like to be put in a box that says, I talked to the city manager about this and we took it off the website. There was a survey that went out and it says, roads are important and so are athletic fields.

Choose one. I said, please Mr. Manager, take that off. And he did, he took it off. And we're coming up with some ideas because it places in a box. If we say we want roads, you don't want you're not for kids. If you want kids, you don't want for infrastructure. So we have to figure out I said this word it where it says roads and infrastructure are daily, everyday occurrence. We know we have to take care of those every single day, top priority. Here's maybe 10 other things, include bills, include whatever.

Pick the other three top items. But don't paint us in a box to try to pick one of them. So with these numbers here, this is the reality, we are woefully underfunded. And it's not just us having the money, it's based on what people are buying gas and so forth. But we have to figure that out.

Think just the age of our infrastructure and so forth, putting band aids on things and whatever today, we're

going to continue to love some of

the stuff the gentleman was just talking about, that we are going to be able to be more proactive instead of reactive and that kind of stuff. But other than that, Jill, thank you for your presentation. We had a conversation yesterday as well and a lot of work is going into this and I thank you for your work. Thanks.

Yes, you Vice Mayor Diaz. Yes, when it comes to roads, it's a challenge across the state of Arizona the way they're funded. Even across the nation, Councilmember Campbell has been a leader on this with her work and advocacy on our tech. So we'll continue to prioritize those items. But it's also important to highlight that we are being proactive. So $20,000,000 in the last four years in addition to our HER funding is going to roads and I think our citizens are able to see it as they drive across Lake Havasu City that we have been investing. We have Akoma Boulevard is getting ready to start for Mill And Fill. We completed Jamaica. We completed McCulloch and Smoke Tree and Mesquite and Swanson. Mean, we continue on, so we're doing that.

When it comes to the budget, I've talked about this before and I've just some of the conversations I've heard along the diocese we had discussion this morning is that we either can have this or we can have that. And that's just not how it is. We have lots of priorities and we have lots of things that we have to do. And with the available funds that we have, we're doing a very proactive planned by data and that is because of some of the studies that we've done whether it is in public safety or public works or in parks and recs that we're having data informed decisions and that helps shape what this budget is. So we have the available resources, we have the available needs and how do we pepper that out to ensure that we're taking care of all of those needs throughout the community to meet the needs.

So this is all about service to our citizens and how do we best serve them. I don't think we need to talk in a bucket of we only get to do roads or we only get to do parks or we only get to do public safety. We can do all of them and how do we find that balance. I think this budget does that. It's a conservative based budget, not increasing taxes. It is keeping the tax rate the same. So we will have a truth in taxation hearing because of that, because of the valuations. But we will be able to continue to prioritize the needs of our citizens and do it with the data informed decisions. And that's what I saw here today. So that we even have the opportunity to talk about additional investments is fantastic that we can talk about the investments that our citizens want, whether it's a splash pad or field development or roads and infrastructure.

I mean all of those things are separate. Today we looked at everything in a very high level. So it's all revenue funds combined together, but we do have enterprise funds. So water and wastewater are enterprise funds. Airport is enterprise fund. The refuse is an enterprise fund. That was all put into one generalization here. So each of those funds are a little bit different, but we're in a really good financial position and we've done really great work and we should be proud of that work. I mean how can we continue?

Can I ask one question of what you

Please, Councilmember Kemp?

What I

heard Jill just stating that we had an expenditure limit cap that literally we built up almost 40,000,000 I think I heard you say in an account that we couldn't even spend. And that correct?

Correct.

And again, this has been a great presentation. I appreciate you. And since then, I mean, if you ever run a business and you have, here's $40,000,000 poop, you get to just have a blast. Go buy everything that's deferred and have have just go. Go. Go. Go. And then what I'm hearing now is we're depleting that money quite quickly. And as a business owner, when do you start pulling back the reins and say, that was fun, you guys. Everybody got bonuses. We gave everybody raises. It all looks really good. I'm in the same business. I understand. And then when we do go through a situation where it gets a little tight or a little concerning, it immediately becomes a problem.

So I guess my question, you were saying that we can do all the things. Well, obviously, we've been able to do all the things because we had a big savings account that pretty much mom and dad said, here you go, have fun, let's spend it, and we've been spending it. What happens in the next few years, she's brought it up in seven or eight years from now. Look at you can see it. It's we can do all the things, but we have to plan better and be more strategic. It's been fun catching up on all of the deferred maintenance and giving everybody raises that always feels great. But let's be honest you guys, was because of the expenditure limit and how much money was sitting in an account. Am I correct?

Let me answer your question. So there's a lot to unpack right there. First, like Havasu did not give any bonuses. So although that might happen in private sector, not anything that happened here. So that is correct. We built up a fund balance of about $40,000,000 and that was back in the 2018 timeframe. And so we've been prioritizing through this planning process. So what we have in front of us is our budget for fiscal year twenty seven and then we also have our CIP budget for five years. That's planning. So beyond the five years, we also when we did our utility rate study, we went out ten years and twenty years.

So we are planning for what the future is. We spent down that fund balance. I mentioned earlier, we have invested $20,000,000 in roads, 20,000,000. So the fund balance went from 4 in addition to our regular HER funding. So in addition to the $20,000,000 in ROADS, we now are down to about $20,000,000 is what I heard in your presentation left in that fund balance.

So of course, we're talking about eight years from now that we are going to have to talk about or address the expenditure limitation. That's planning. We're planning and planting that seeds. We're talking about and after the five year and approved rate study for water and wastewater, we're going to have to do something to continue if we want to continue the investments you're talking about that are so important to you with water main replacements and all those types of things where the council is going to have to address then have those conversations. So we are able to balance all of the things.

So we still have that fund balance that Ms. Olson mentioned earlier with all of the things outlined in the CIP plan. The only one thing that has not been determined yet is if we move 1,500,000 up for the splash pad. I know Councilmember Moses has advocated for it and I can support that as well to have a splash pad in that area. I think Councilmember Koch had mentioned that as well. I mean we can have more discussions about that, but we are planning and we can do the things that are important and prioritize the needs of our citizens. And we have that ability to do so.

Mayor? Yes, Mr. Knutson? If I can just add, we talk about the funds the city had available largely due to the expense limitation back in 2017, 2018 timeframe out of the tune about $40,000,000 I believe about $12,000,000 of that was a debt issuance the city made. So I would not count the $12,000,000 You can knock that down to about $28,000,000 at that time.

And also keep in mind, at that time, we didn't have a proper reserve, budget stabilization reserve. The council with the foresight and direction that was provided, we now have a six month reserve in place. We are a tourism economy. If something would happen, heaven forbid, with regards to our economy, we need to have the time to make decisions when it comes to possible cuts across the board for city services and city employees and whatever that looks like. We need to have that.

So back in 2017, yes, 40,000,000. 12,000,000 that was debt issuance and we didn't have the proper reserves in place. So we now have a six month reserve in place to make sure that we are in a good spot if something terrible would happen through the economy. In case of emergency break glass, we now have that ability to do that. We did not have that in 2017. So putting that perspective as well too.

Thank you, Mr. Clifton.

Thank you. I do appreciate hearing that. Perfect. That's good. And the next, can I just the debate now if I like if we're having an open conversation?

Your time is over, we're on Vice Mayor Diaz, but I

thought we were okay.

I will, Vice Mayor Diaz has a What was

Flashpad or Swimming Pool? My question to all of you guys was why all of sudden is the flash pad more important than the swimming pool that we were talking about?

Sure. And we'll have that discussion. Vice Mayor Dias? Yes. I had

a couple of questions here at the top I forgot to ask. So in regards to Fire Station seven, it's on there at $8,300,000 Are we sure we could get that done for that price? Mean, are we confident?

Mayor, Vice Mayor, we've worked that's the 8,300,000 is the carry forward that's left within that fund. We should have a guaranteed maximum price that we're leaning on in the next like a week or two. And at that time, I can say with 100% certainty as we bring that contract to counsel with that number. But all signs point in the right direction.

Okay. Thank you. I appreciate that. And then in regards to the bed and breakfast tax and the bar and restaurant tax, I know we give $2,100,000 combined between PED and Go Lake Havasu, and we take in $4,200,000 So does that other $2,100,000 just get put into the general fund?

Mayor and Vice Mayor. So those are like tourism dollars. And the council's direction was that there will be a tax collected through restaurant and bar and through the bed tax that's got to be used for tourism. We start looking at economic development. We start looking at the impacts to the city when we have tourists in town, which is a great thing. That's an increase in levels of public safety. So our population says it's 60,000 population. But typically we have 70,000 to 80,000 people in town at any point in time. So we're using those dollars specifically for public safety in the budget. And that's the nexus there.

And then lastly, would it be possible to get some kind of a spreadsheet that shows the maybe go back just ten years that shows the salaried positions, number of positions we've had with the city compared to today and number of positions and the total salaries? Because I was under the impression that we had a lot more growth in salary and positions, and now I'm hearing that we had less. So just for information to have.

Mayor, Vice Mayor, certainly we can pull any information that you like. The information that Jill and Angie provided today was over the last four or five years, the last four years. You want to go back to the 2000s?

We

have that in front of us.

Is there anything in addition to that printout that you have there that goes back that Or is there anything more that we can provide for you?

Where are

you at?

This is added. Oh, it's separate thing. Yes. And that has the five

years by summary and then also by department.

I'll analyze this. We just got this today, right? So I'll analyze that and we'll have further conversations. Thank you.

Okay, thank you.

All right. This is a public hearing. Would anyone like to address the City Council on this item? So this is an opportunity for any citizen or any resident that would like to engage in the conversation, share your viewpoint, what you think about the budget or priorities you'd like to see. Just make way to or even state your name for the record.

Hello, mayor, council members. First, I want to compliment the staff. Fantastic staff we have. My complaint or my question is more about the direction that they're given. I think the staff is fantastic and I think they need a little better direction, particularly in what you were addressing a minute ago when you're talking about the funding for streets and water mains. I'm a little behind here because my I'm just pulling up some of this information. But my question really had to do with your statement about $20,000,000 put towards the streets. So what year's range are you using that $20,000,000 range for?

And Mr. Lutz, it's on the screens around the room. So fiscal year 'twenty three is $9,000,000 'twenty four is $1,000,000 'twenty five is 5,000,000 and '26 is $5,000,000 So that's the 20,000,000 that's in addition to the HER funding.

The $25,000,000 for 25,000,000 was that likely HER funding?

No. So if you look at the two, you'll see the VLT on the first line and then you'll see the annual transfer, which is the 20% of the VLT, which is $1,000,000 and I'm talking in addition. So this is additional general fund transfers into the HEERF fund. So it all has to move to HEERF because that's where we fund out

of it. It has to move to HEERF. When we see it, we see it coming out of HEERF.

You see the transfer as well and then it comes out of HEERF when the expenses occur.

What I was looking at didn't see that at all. And then regarding $20,000,000 for that time period that you're talking about, from what I've listened to Streets and Maintenance talk about what needs to be done and then the 500 miles and what it's going to cost. If we were to transfer that into a twenty year plan, we're going to need $20,000,000 annually in order to cover the kind of streets that we have here. So like someone mentioned, willfully underfunded on streets and maintenance, let alone that's not including the water main situation. And back to the water main situation, I really don't need to get off the streets yet.

But I mean, that's pretty astounding that we need to invest $20,000,000 annually to catch up to where the streets should be.

Mr. Lutz, where are you getting the $20,000,000 annually that you need? Well, if

you were to calculate $1,000,000 a mile and how many miles we have over a twenty year lifespan of the roads, again, I could present that in a presentation for you, but that's what I'm getting at. So when I see you all spend money on Parks and Recreation, and I don't see any real grant request for streets maintenance and more in particular water mains, I just wonder where our focus is. And again, this is not with the staff. Staff does what you tell it to. So when we see that you are focused on parks, that's great.

But I want to see the focus on streets maintenance and water mains too. Back to water mains. When he was talking about water mains, he's not talking about replacement. Maybe there's a replacement procedure on maybe a coma. I hope that's what's going on. But all we see is repair. So we see sections at a time that break and then we go repair it. We're not replacing sections at a time that should be replaced under replacement instead of repair. So we're very reactive to our water main problem instead of proactive in prescribing an area that needs to be replaced at a time. We should be doing five miles at a time or more.

And I'm a citizen. I'm not a water expert. So why am I having to be a water expert and you guys are supposed to be doing that for us? So that's the leadership problem that we have with some of this situation with City Council. We expect you to be looking after our water mains.

Testing. It seems to cut in and out. Testing. Testing. Okay.

My name is Dave Johnson. And I just had a quick question here. We were get it all figured out? So you guys mentioned staffing from 2009 and how we have less employees now. And I understand we had a great recession and a staffing reboot after that.

But in this little piece of paper I have here from the city, in 2016, we had four ten employees, and now we have five ten. And in 2016, we had 10 in Parks and Recs. This year, we have 47, and they're asking for another five, fifty two people in Parks and Recs alone. I don't know what kind of staffing requirements Parks and Recs needs, but it would seem that that department gets more staff every single time than all the other departments pretty much combined. So

I would just That change was parks maintenance used to be in public works. And then it was reclassified into parks and recreation. And so that was what that

a large amount.

You said that last night, but again, these are total city employees here, four ten to excuse

me,

four forty to five ten. These are actual new hires. That's not including the transfer.

Yes. No, it's the specific questions you

asked about how did Parks and Rec are I'm going text

this to you so you can see it.

Ms. Olson, do you have any additional information?

That's total city employees. That's how many per department. Yes. So in 2024,

we actually

five working in Parks and Recs. 2025, we have 47, and now we're asking for another five, that would be 52. I don't know how many people it takes to run Parks and Recs, but it just seems like it's a little out of control. And I'm going leave it with this. You guys are flirting with a budget that's over a quarter billion dollars. And you guys have unknowns of potentials of $6,000,000 going in and this and that going out. Just give the kids the water park.

It's about $05 You could find it.

I know you can. I got faith in you. Thanks, guys.

Thank you. Would anyone else like to address the City Council on this item?

Hello. I'm not sure why, but we were asked to leave.

Really?

They told us we had to go wait outside.

Who?

A cop came in and told us we needed to leave. So I'm not sure what that's all about, but

I know, is a public hearing that

I know.

Opened. I'm sorry that that happened.

Why we have to wait outside if we're here to listen to a public hearing.

Yes. No, yeah, you're more than welcome to be here. I'm sorry for that.

Yes. Kenny, no. Thank you, ma'am. So I I understand that there's problems with the infrastructure and that obviously needs to be fixed first and there's all kinds of stuff that is very important. But I just wanna say don't write our kids off.

I know it's I know that you know there's a lot of things that are important to the budget and that our children aren't contributors to society because, you know, they don't pay taxes, they don't vote. But they are the future and I know. In a world where a lot of kids are stuck inside and rely on technology especially in a hot climate like this. I feel like it's really important that our kids have safe outdoor spaces to play. And, you know, we get a lot of comments on the Facebook page, community page that say, just take your kids to the lake. Why should it be my problem? Okay. Well, why is it my problem that, you know, we have to pay for parks? Go walk your dog at home. I It's the same thing.

You like to read and go to the library? Well, I shouldn't have to pay for that either. Buy books on Amazon. You know? It's it's kinda difficult when, you know

k. Kenny.

As you can tell, my kids don't like being stuck at home. They like to go out and do things, and I do take them to the lake, and we go to the park every morning. So it's important for us to have places to play. But we've also had friends come from out of town from California, and they go, oh, do you guys have a splash pad that we could take the kids to? And I have to go, no, not really. So I just want you to understand that I know there's lots of things that need to be fixed first, but also just try to keep us in mind.

Can I make a comment? Did you hear the same thing that Campbell's don't care about kids? Yes. You did. Yes. You did.

I've heard lots of things about lots of people, and I'm like, I get it. They they have other things that are important.

But the part is that if you know, I don't think there is a a youth organization that the Campbells or my family hasn't been a part of. So that's really disturbing. And I noticed you're looking at me for the whole thing. I'm just pretty much saying, you don't care about my kids because that's the rumor going around. And I I mean, there is nothing in the city. I I Tammy, maybe there's a couple organizations that we haven't either donated, supported, built, and I also even save music helped to save music and arts in our schools. So I'm a little offended that there's that's the rumor right now that she only cares about roads. She's trying to you know? So I apologize that you had to hear that information. And I hope that you actually do a little research about our family that we do really care about your kids.

And this hasn't I'm over here trying to make work deals to figure out how we can make it all work with the fields and everything else. So, for all of you again that heard that out there, that's not true. Thanks. Thank

you you. So much for and again sorry about that confusion about but you're more than welcome to stay in here so no need to leave. Would anyone else like to address the city council on this item?

All right. Good morning, Mayor and City Council members. My name is Kristen and I'm here today as a mother and as someone who has built a community of local families here in Lake Havasu. I want to speak on the importance of finding more family friendly spaces in our city, specifically a true public splash pad and more outdoor recreation opportunities for our kids. Last year I was at this meeting and a splash pad was included in the capital improvement plan and this year it disappeared.

At the same time we are finding millions of dollars for road projects, projects totaling about $5,000,000 yet somehow we cannot find funding for something as simple and impactful as a safe place for our children to play outdoors in the summer heat. And I understand that some longtime residents question why tax dollars should go towards another splash pad because we already have one. But respectfully, what we currently have on Mesquite is not comparable to what neighboring cities offer like Bullhead, Needles, and Kingman. And a few water spouts in the ground that open and are unmonitored and unfortunately has become more of a bathing and water source area for homeless population than a family destination. As a parent I can honestly say that the few times I consider bringing my children there I found needles on the ground, unknown pills, homeless people sleeping on the benches, and the play structures, which also that play structure is not shaded.

So it gets hot by like 9AM at that location. This is not a safe or welcoming environment for our families. Bullhead City has done it right. They created two clean shaded fenced splash pad areas designed for families and a pump track. Needles and Kingman have similar features. And I often hear when we were kids we didn't have splash pads. We just used our imagination. But these spaces do encourage imagination. They encourage movement, social interaction, and outdoor play. They get the kids off the iPads away from TVs and being outside being active instead of being stuck at home.

Another common response is we have a lake, go enjoy it. And we do. My mom group hosts beach days regularly. We support local parks and outdoor activities such as the Parks and Recs trailer that you guys added which has been amazing. But having the lake should not exclude families from having the same amenities that surrounding communities already prioritize.

The surrounding cities like Bullhead, Kingman, and Needles have invested in shaded clean interactive water play areas because they understand that families matter. Recently I shared a public forum on many of the Facebook groups and in my mom group to sign if they wanted the same things that I'm wanting. And I received four thirty six signatures in support along with 144 written responses directed towards what they would like to tell you guys if they could. Because obviously these meetings are pretty hard with our kids. The overwhelming themes were clear.

Families want safe shaded well maintained splash pads and parks. They want more indoor recreation options because of this extreme heat. They want youth programs, sports fields, bike spaces and places where teens and children and babies and toddlers can safely gather and stay active. Many families also expressed concerns about the condition and overcrowding of current facilities and a desire for more transparency and community involvement and how projects are prioritized and funded. I emailed all this information including signatures and resident feedback to every city council member and the mayor.

And the only ones that actually said anything back was mayor Cal and Cameron Moses. So I truly appreciated that acknowledgment because these families simply want their voices heard. Most importantly, people want to feel like full time families matter just as much as tourism and snowbirds. And

while I

appreciate that Lake Havasu has invested in things like the skate park, I'd also encourage the city to think about adding a family recreation option like a pump track where bikes and scooters can use it another way to get kids active and outdoors. I mentioned this last year by adding a shaded cover to the swings in the sand over at Rotary Park or adding a stop sign or a crosswalk across from Angler And Avalon across from Avalon Park. There are many families and people who would have dogs because there is a dog park there that walk from the neighborhood over there and ride bikes. So I live right over in that area. I see how fast people drive down Avalon.

It is unsafe and I see kids walking across, jaywalking because there's no other area to cross because we don't really have sidewalks here. Families are not asking for luxury. We are asking for clean, safe, intentional spaces where our children can play, connect, and make memories in the community we call home. If we want young families to stay here, invest here, and build their lives here, then we need to start investing in them too. Thank you for your time.

Thank you so much. But anyone else like to address the City Council on this item?

Mayor, if I can, real quickly. And I understand why the gentlelady that addressed us talked about being asked to leave. I just want to make it clear that there was no member of the police department that did that, but I can understand why she thought that. It was security downstairs. I'm not sure why that happened, but that's certainly inappropriate. We'll that conversation.

Mayor and council, actually, that's why I'm here to talk. So if somebody's going to fall on the sword, it should be the person that needs to fall on the sword. That is me, mayor. This is still a court building. And as a

court

building, security is instructed to make sure that proper court decorum happens in any of the rooms to include any disruptions. And so if there are disruptions that are happening, then security is instructed to come and say, hey, why don't you step out until it's your turn to come up. And so that was what happened. They were instructed to say that. They weren't asked to leave. They were instructed to please step outside until it's your turn. Again, it's because this is still a courthouse and that proper court decorum should still occur. But there was never any intent for anybody to be asked to leave. And I don't think that's what was communicated.

Thank you. Thank you. We'll communicate that more effectively. So thank you. Yes, Vice Mayor Diaz? I just want

I just want to kind of nip a narrative in the bud that I see happening. And it even happened here today kind of an insinuation type of thing. And I apologize. I usually make it a point to answer all emails. And we just checked. I did get that email. And I usually do respond back. That's what people say they like about me because I respond back to them. I'm usually one of the only ones that does it, and most of us do. But this narrative that just because we're trying to prioritize certain things, and you always have to prioritize wants and needs in the budget process, does not in any way say that we do not care.

Everyone up here, all of us do. I think I can speak for everyone, cares about the youth in this community, baseball fields, athletic fields, swimming pools, splash pad, whatever you want to call it. And do. And lately, just these last couple of weeks, there's been some false narratives out there that I've seen myself and I've heard from people about a couple of council members up here that don't like aren't prioritizing the youth of this community. And both of these two people have a history of just unbelievable support of the youth and families in this community.

So I know the social media is a necessary evil these days. It's the new it's the town square. But don't believe everything that you hear on there. Come and talk to us directly. I apologize for not answering your email. Thank you.

All right. We saw her in the public hearing. Would anyone else like to address the council on this item?

Thank you, members mayor and member of the council. My name is Donabelle Carlton, and I'll be real brief, believe it or not. We have a lot of needs and wants. I've lived here since 1969, And, it might be time for people to put their money where their mouth is. We're going to have to look at raising rates, taxes, water sewer rates, whatever it's going to be.

If we want these things, I, for one, would be willing to pay a little more to continue and retire in a community that is blessed with all the amenities that our families need, whether it's roads and the water lines fixed under those roads before they're replaced, or whether it's fields, parks, flash parks, a safe area, a wonderful place for our elderly as well as our children and families. So I'm just saying I'd be willing to pay more. I know that's not always a good thing to say, but it's been a long time and it might be time. Thank you.

Thank you. Anyone else like to address the council on this item? All right, seeing that we'll close public hearing, bring it back to council for any final wrap ups. One thing that we do need to wrap up is the splash pad. So that would be Mr. Knudson had mentioned that they can make some adjustments to that budget to prioritize that $1,500,000 I would be in support of that. Council Member Moses, know you're in support of it since you proposed it. Dave, don't know have any additional comments. We'll just make our way down the diets.

Do want additional comments or just weigh in? You weigh

in if you're in if you are supportive of that.

Yes, I'm supportive of the splash pad obviously. I I really I'm interested to see how we get it done because it needs to be responsible. So where we put it and all that stuff, I'd like to see. But I just wanna throw it out there because there's a comment made that, you know, we're not talking about roads up here. Only one person is talking about roads.

We're not talking about roads up here because we all agree. We've all been putting money towards roads for the last as long as I can remember. That was one of my biggest things when I first started on council is seeing what we need to do. And so I'm right there with you. And the reason why we raised water rates, which wasn't the most popular thing, but we raised the water rates so that we can afford to do these improvements to our water infrastructure when we start working on roads and all that good stuff too.

So I think we've been doing the prudent work. I'm unlike you, Ms. Campbell, where I don't have expert boots on the grounds. Not in my family. I don't know anybody.

So I have to go find them. And so I've sought them out and people that I trust within the water department and road department and all these people. And I literally this week, I said, hey, I'm going to make a push to have some to include the splash pad in the infrastructure. Are you sure that our roads and our water infrastructure isn't in a dire situation? And he says, well, I will never you know, we're never going to turn away money.

You know, it's an ongoing thing. It's not as doom and gloom as what some people make it out to be. We have issues. We fix them. But it's not as doom and gloom as of of what it sometimes made out to be. I don't think we should do roads or parks. I think we can do both. And I think we've been doing both. We've done a lot of roads lately, and so it might look like we're now pushing for only parks. That's not the case.

We just haven't done parks in little bit. We've given them some money to do improvements and take care of our existing people, I'm sorry, and take care of our existing, infrastructures. But I like the path we're on and, we'll continue to do both. And that's, that would just be my message.

Thank you, Councilmember Moses. Councilmember Koch?

Yeah, I would support, working on that splash pad. And again, just another big thank you to Jill and the rest of the staff. This budget process shouldn't ever come as a surprise. We've seen it for the last few months. They've been working on it over a year. As soon as we approve it, they'll start on the next one and we've gone through this process. And again, I agree with my fellow council members. We don't need to pick one or the other. We just need to make sure that we're taking care of it across the board and doing it responsibly, fiscally responsibly. And I think we've done that.

You, Councilmember Koch. Councilmember Lehlen?

Go ahead, put the splash pad in there. Maybe, Fajat can come through with a grant. I would prefer to see the pool. I think that's where that's the angle that we were going. And I think we should have relooked at that, but go ahead and put the splash pad in there. Have to vote on it anyway.

Thank you, Council Member Lane. Council Member Campbell?

I don't know what happened to the pool?

It's still in the budget. Yes.

But it

got pushed way back. We had to place packed full of people that want to pool. I had all the data in the world that we need pools. And now we have we pushed the pool back, but we're going to do splash pad. I'm going to say no to the splash pad.

Vice Mayor Diaz? And kind

of the same kind of a sentiment, we had pool there. We didn't give and that's another false narrative that we didn't, we canceled the pool at the last whenever that happened, when that came up to at the council meeting. We didn't cancel the pool, just put it back into the CIP for the next fiscal year. And then now that got turned back to 2930. So, yeah, if Gazette can get a grant and hopefully help supplement this splash pad, that's fine. I just don't but I just don't I hate feeling like if we vote no, you don't want you're not for the kids. Nothing is farther than the truth. But if that's the majority of the council wants to do that, I'm fine with it.

Thank you. Yes, so just the Splashpad has always been in its budget. It just was grant funded. And so I think the request that Council Member Moses is asking is to fund it with general fund dollars, put money behind it that will allow some opportunities for partnerships or seed money for grants if that's an option. And again, this is a high level plan. So our commitment now it will come back before council for council's final adoption at the time that it's ready. Councilor Merlin.

Yes, I was I didn't want to say this, but there was never a talk about a splash pad until we came to a retreat and we were told we were going to get it with grant money. So we gave this vision to our community about this splash pad. We said we're going to give you a splash pad and sold it to the community and sold it to a council at a retreat that it was going to be funded by grants. And now we are not going to get the grants, so now we have to tell people we're not going to get the splash head. I think it's super unfair that the council got put in this position.

I really do. I think it was really, really unfair to put us in this position because we weren't talking about splash heads. We were talking about pools. So I'm going to vote on this or approve whatever you want to do, but it's not fair how we were put in this position. This was not an item that the council brought.

I would add one We have to be and I agree with that 100% because we have to be careful how we word things to the council because

it does put us in

a bad position. Because at that retreat, we were told there was a grant for the splash pad. That's exactly I mean, you want to roll back the tape? It probably wasn't videotaped, but that's exactly what was said. And then today we get word spaghetti and trying to get on an answer of why that was we were told that. No, you really weren't told that. But and I hate being put in that position because I don't want to be put in a position unfairly that we don't care about kids. I mean, I've got three grandkids and I raised four kids myself and was a baseball coach and a high school coach. Nothing could be further than the truth. So let's just move forward and hopefully we learn from this mistake.

Or it was a mistake.

Mistake of the messaging how we Yeah. Got to this

And Mr. Can I just say, just to lay on that too, is that I remember the pool situation? And when we went back there and came back out, we told the community we were gonna put it in the next year's budget. And then I had council members call certain people in the pool industry, the pool people, and said, it was Nancy Campbell's fault that you didn't get your pool. That's what they said. And I'm like, what? So I'm over here trying to advocate for the pool because we now pushed it back three or four years. So I'm just getting it out there to everybody, everybody that's here. I advocated for the pool over the splash pad. Alright?

So if you're getting phone calls that Campbell didn't want the splash pad and she doesn't want the pool because she doesn't care for kids, I don't appreciate that either. And that needs to stop, and we know who that is. So, again, the messaging is wrong. I mean, I'm confused. Are you guys confused a little bit? We told the community that we're going to put it at the pool in the next year's budget. And we're turning around and spending it's going to be at least $1,500,000 for a splash pad.

What's being considered as $1,500,000 in the budget? So that's all that will be able to be spent on that with the current budget as it is. When it comes to the pool, what we're adopting is a five year CIP, so it gives clarity and continuity for a long range plan. But we're really focused on this next year. So there's no reason to say that the second pool can't move up next year, not fiscal year 2027, but fiscal year 2028 if that's the will of the council at that time. Mr. Knudson, did you have a comment?

Yes, if I can. Mayor, Vice Mayor, Members of Council, aside from the conversations in terms of this is purely an operational and just to make sure that we're all on the same page in terms of conversations and direction and so forth. Zero, nothing else. At the time of the annual planning session, the question from staff for me directly to counsel was does the counsel want to identify funding for the splash pad or should we pursue grants? We can't make any promises on a grant application.

We don't know if a grant application is become available and we certainly don't know if a grant is ever going to be successful. So it's a similar type of question that we're asking today or counsel providing direction today. So I just want to make sure that we're perfectly clear on that. So the question is the splash pad continues to be in the budget. Previously, it's been with zero city funds earmarked for that project solely to guide council I'm sorry, to guide staff into pursuing grants.

Now when we apply for a grant, one of the first things on the grant application is, is this part of any city plan? So if it's in the CIP with zero funding, but it's still in the CIP, that allows us to check that box and say yes, a council approved plan says the city would like to have a splash pad. That allows us as city staff, Vigette and Anthony and Heidi, to pursue a grant for something along those lines. So now the conversation is a little bit different today than it was at the annual planning session. Does the council that's what I'm hearing is the council wants to identify general fund dollars, dollars in the CIP for the splash pad.

And I say that just because I want to make perfectly clear where we're at with all this in terms of a grant, pursuit or not pursuit or all the rest. So the question that staff needs answered and the direction needs to come from council to staff is, does the council want to see city dollars earmarked for that project?

Mr. That was the question I think we asked when we went down. So if that change if Mr. Knutson's comments change anyone's position, now is the time.

Mr. Mayor, I have a question. What does it cost to maintain a splash pad? Do we even know that? Like we're going to put a splash pad in? What does it cost to maintain it? Where are we putting it? Because I don't think we even saw a location. I don't know where the bathroom is down there. I I don't know where any of that is and I'm going to vote on or approve something today or I don't know where they're going to be.

And customer, it's a high level plan. So all the details will come back before council with location, operating costs, what it will look like. Right now it's a high level plan do we want?

But Mr. Mayor, that's really hard for me and I don't want to go down this but we did the same thing when we this high level thing with the bathrooms down on the channel right now which we are finding out that it is not on city owned property and we put it in a budget because we didn't get that information. So I need the information that you're saying is at a high level in order for me to make a decision. I need to know where it's going to be. I need to know how much it's going to cost. We didn't get that with the pool. That's why we ended up where we were before. So I want that information before you ask me to put something in a budget. I want to know what that is. I know what I'm going get with streets. I know what I'm going get with water. I know what I'm going get with a fire station. But I don't know what this is going to cost to put in a splash pad.

$1,500,000 is what the number in the budget.

And what's the maintenance? And who's going to maintain it? And do we have to hire more staff to maintain it? And what's the insurance on a splash pad? Like, have a lot of questions on it.

And Mayor, how are we going to avoid what the lady just brought up was our other splash pad. She said it's homeless place. The homelessness bathed there. She found needles in it. And it's how are we going to protect this splash pad over the other?

Are we putting a big fence around it? Are we going to have staff there? I agree. I'm over here with, like, Councilwoman Lynn that I don't usually when I buy a truck, know that there's going to be employee in it, and I know what the truck is going do, and I know what the revenues are going be to bring it back to This is just like here's 1.5 out of the general fund and I'm worried in the end like this building that we're in right now. It started out at like we paid 3,000,000 and then we were gonna put 1.7 and then we put it into then it was 4.2 and we're at over $12,000,000 and one point

We're not 6 coming million out. We're just not at it. Is I know. But this is truth matters.

Well, it is. No. It It's under $10,000,000 No. It is. No. No.

We Yeah. Put under We put under

I have a I have a report from Jill that she gave me everything all the way down to the fixtures. So I know the exact number. But the point is, let's be honest, this is what Councilwoman Lynn and I are saying. Does the splash pad turn into like very high electric bills? You know, did anybody up here know that we spent $1,600,000 in fixtures in this place? Those are big deals.

We approve those. So the council should know that. The council approved those items.

No. You.

Yes. So all right. Well, I think we're still in the same position we were before, Mr. Knudson. Yes. Vice Mayor,

do ask is

there a possible way to before we actually vote on the budget come June, correct?

Yes. Is there

a possible way possibility we could get that information that Council Member Lin is asking for, which

I agree with before we actually put it in the budget? Yes. Right now, we're talking about having the number allocated. All of the details will come before counsel for counsel to consider the final adoption. The location as I understand it is in conjunction with the ADA bathroom project down at Rotary Park. There is the police service assistants are focused in that area as well as park hosts down in that area. But the operating cost, we haven't given the staff any direction to bring anything forward on it because there's no funding attached to it. So Mr. Knudson, is it reasonable for you to have estimated cost of operating before we do tentative budget adoption in June?

Sure. That's the will of the council. Can have some numbers. Jill, I know you're

If I may, in the CIP book for the project sheet for the splash pad staff has estimated the annual operating cost. And you'll notice that on many of the CIP projects, there's an operating impact section and it's about $55,000 a year between utility supplies and personnel. 54,800.

Yes. Yes, that's on Page

28 of the book.

We do have that number. I just feel like there's just lots and lots of lack of communication on things.

You guess have the book in front of you. How is that a lack of communication?

Mr. Mayor, may I?

Please.

I'm just saying right now, I just asked the question. You didn't know it was in the book. He didn't know it was in the book. And so you're accusing me of not knowing it was in the book. I was just asking, and somebody could have said I could have referred to the book. Jill didn't Jill didn't didn't say it until we were asked right now. It's just a lack of communication. That's all I'm asking for on these projects. Give us communication, give us the right information that we need so that we're not blaming staff, we're not getting accused by the constituents of making decisions. Give us the information we need. I shouldn't have to go and seek it. I shouldn't have to go seek it from our staff, from old staff. I should not have to do that. It should be in front of me. It should be discussed when I ask the question. And it's not. It's just not always.

Well, I apologize because I may have overstepped in my words when we're talking about it, but I was prepared during our CIP budget work session with this document. So I had pull this from our April meeting, but the information is there. Yeah. Vice Mayor Diaz, did you have any comments? Okay. All right. Are there any final comments on the budget? Mr. Knutson, do have any final pieces of information that you need?

I'll ask Ms. Olson, Spakin, is there anything that we need clarified? I think we're in a good spot. We have a

little bit of work to do.

Perhaps just an understanding that other projects will have to be removed from general fund funding in order to move this splash pad up and we can't just move things up without looking at the overall funding. Moving the pool up to FY 2028, there's not sufficient funding to do that currently. So just with an understanding that other things will move as well.

Yeah. We'll take what we'll do is we'll staff will sit down and we'll prepare, take the direction and absorb all the conversations coming from counsel to the team. And we'll put together a plan and we'll present that at the next budget meeting.

Thank you. Vice Mayor Diaz?

Thought it was referred

to earlier that the splash pad is voted on that we were going to remove the public safety storage. Did someone say that earlier?

So there's a two in my head right now, there's two options and I need to sit down and talk with the team, Mayor and Vice Mayor. We have the hangars project that's within the CIP. We also have the police storage. And there's some thoughts. And we want to creative. We want to think so outside the box. And we want to is there a way for us to accomplish the goals that we have as a city doing it a little bit differently and being able to present that plan to council. So I got a couple of thoughts in my head. I need to speak with the team and the people that are much, much smarter than me.

No, do we know that because I know leaving stuff out in this 110 degree heat in the summertime is cost money also to the detriment of the equipment outside.

1000000%.

Thank you, sir.

You, Vice Thank Mayor. Diaz, any final comments from members of the council? All right. Thank you all for being here and engaging again to the city team. Thank you so much for all of the work that you've done on this. To all the department heads and city staff, we appreciate it. We are adjourned. We'll see next time. Be kind. Okay. I'll take a look at it.