City Council - Special Meeting

six o'clock. We're going to go ahead and kick this meeting off. Thanks everyone for being here tonight. This is a city council regular meeting, March 31st, last day of March. Uh we are live here at the mill and also broadcasting on our YouTube channel. Um I will call this meeting to order and we'll stand for the pledge of allegiance. I pledge algiance to the flag of the United States of America and to the republic for which it stands. One nation under God, indivisible, with liberty and justice for all. Clerk Chelin, can I get a roll call, please? Council member Aria,

here. Council member McManis, present. Council member Donahghue, present. Council member Shipman present. Council member Jorstat present. Council member Edwards present. Council member Packard here. And then Mayor Gayy will not be in attendance tonight. So I will do my best to get us through this meeting. Um and to that end, everyone has an agenda in front of them. Had a chance to take a look at it. Do we have any uh requests for any changes or additions or a motion to approve? I'll make a motion to approve the agenda as written. Second. We have a motion and a second. Any discussion? All those in favor say I. I.

Any opposed? Thank you. We have an agenda. That brings us to citizen comments. Um I have four green sheets in front of me. Thank you so much, Caitlyn, for double checking. Let's start and see how many folks we have online. I have two people online. So again, if you would like to speak, did you want to take this first? That'd be great. Can I say one thing really quick? Absolutely. Because we have um six so far citizen comments. Just want to remind folks um we do have 3 minutes maximum, we're going to stick to that three minutes.

Um and then if somebody before you has said something that you want to say, if you can just be concise and um say anything additional, that would be super helpful. Thank you. All right. Thank you. So yeah, for the people that are online on our Zoom meeting, if you would like to speak to the council right now during public comment, please raise your digital hand and I will bring you into the meeting. I am seeing no hands. Great. Thank you. Then I'll start with my first sheet which is Rachel her.

You have an order. Okay. Who's gonna go first? Excellent. Jeff, you're first up. Yeah. [clears throat] Okay. You have three minutes. Please state your name and let us know what you're here to talk about. Uh my name is Jeff Pgram. I'm going to talk about Aqua Fest. Great.

Um council members, my name is Jeff Pgger. I just said I grew up here. Uh my grandparents are resting in Machias at the only cemetery in the area closest to their home. My mother grew up here. My kids grew up here. And now my grandkids are growing up here. My roots run deep here. This is my town. If you don't grow up here, then welcome. This is now our town. At 24, I volunteered as a firefighter here before making my career. I bought my first house here at 26. I'm the co-founder of the Lake Stevens Charitable Thrift Store, which gives back to this community. I love it here. I attended my first Aqua Fest parade in 1975. My daughter attended hers in 1995. Today I serve as co-vice president doing my best to pass this gift along to my grandchildren and every every other ch child who's going to going to experience their first parade or carnival. For more than half a century this event has been fully supported by the city. I understand the city's facing some financial challenges but should Aquafest be a casualty of those challenges or should the departments responsible for those financial issues financial issues be held responsible? It's my understanding that Aqua Fest funding is already included in this year's budget. If that's the case, why is the vote needed to approve the funding? Seems to me this vote is out of order. If any changes are made, the appropriate action would be to vote on removing the funding, not reappro approving what's already in place. I urge you to call this vote out of order and allow Aquafest to continue as has for decades. Then with ample time, we can have a thoughtful discussion for 2027 and work together towards a solution. Thank you.

Thank you. All right.

Hello. My name is Raquel Piggrim and I am Jeff Pgrim's wife. Um, good evening council members and community members as well. Thank you for this opportunity to speak with you tonight. When we talk about why we choose to all be involved in our community, I'd like to speak specifically through the lens of Aquaest because Aqua Fest is more than just an event. It's a reflection of who we are as a city. Aquafest ref represents connection. It's where neighbors become friends, where families create traditions, and where our community comes together in a way that you can feel. It's not just something people attend. It's something people belong to. The why behind behind Aqua Fest starts with pride. Pride in a city, pride in our lake, pride in the people who call this place home. It is about showcasing what makes our community special and creating something that everyone from lifetime residents to firsttime visitors can experience and enjoy. But Aquafest does not just happen. It is built by volunteers by hundreds of hours and by individuals who give their evenings, weekends, and their energy often behind the scenes to make this tradition continue. It is built by local businesses who invest back into this community and and the and uh the community it serves. Um it is built through partnership with city leadership organizations and residents all working towards something bigger than any one of us. We are involved because we understand that impact. Aquaest supports local businesses and it brings visitors into our city. It creates opportunities for connection that last far beyond a single weekend. It gives our youth a sense of involvement and belonging. It strengthens the identity of what our community can and will be. And perhaps

most of all, it becomes a legacy. Aquafest has been tradition a tradition of generations. The work we have put in today ensures that we will continue for generations to come. The memories being made now on the waterfront, at the parade, and during all of these events are shaping how people will remember this community for years. So when we see the effort behind Aqua Fest, it is not just about the planning an event. It is about preserving something meaningful. It's about showing up for our community and for making sure it thrives. The why is very simple. We care deeply about this city and we believe in bringing people together and we are committed to keeping that spirit alive through Aqua Fest. Thank you for listening to us. Thank you for considering all of the things that we say tonight and taking into consideration um helping us continue this tradition for years to come.

Thank you. Who's next? Thanks, Cindy.

All right. Good evening, council members. My name is Cindy Cindy Limos. I've been a resident at Lake Stevens since 2015. I live here with my family, including my nine-year-old twins. We're proud to call this community home. Professionally, I work in the Restec industry with a focus on customer experience, technology, and strategic partnerships. I only recently joined Aqua Fest officially um as a volunteer officially in January. So I'm very new here. However, I've attended Aquaest for many years with my family and it's something that we truly value. After 57 years of this incredible tradition, I felt it was time to step up and help carry the torch. Now that my kids are older, I have the time and I desire to give back to the community. Something that has brought so much joy to this community and will continue to shape my children's experience growing up here.

[clears throat]

In my short time as a volunteer, two things have really stood out to me. First, the volunteers. I've been genuinely amazed by the dedication, time, and energy that so many people have given for years, completely unpaid to make this event happen. This is a massive undertaking that serves 30,000 attendees and is powered almost entirely by a community of volunteers. That level of commitment is extraordinary. My second shock factor was the timing and the nature of the city's recent cost proposal. From a business perspective, this was difficult for me to comprehend. Budgets are typically planned annually, so 12 months in advance, and Aquafest has already been in motion for months. So to introduce a potential 40 to 47,000 expense with just a few months before the event, especially after many years of inkind support, creates significant and unexpected burden for a nonprofit organization. I've never seen a situation like this before. Four to 5 months is simply not enough to absorb costs of this size, especially for volunteer-driven organizations. Additionally, the lack of clarity around the amount makes it even more challenging to plan responsibly. So, my request to council tonight is this. Please consider delaying any new or additional city imposed costs until 2027. This will allow for time for proper planning, transparency, and collaboration. But more importantly, it would protect Aqua Fest this year, a 57-year tradition woven into the memories of this community. Something families plan for, look forward to, and pass down to their children like me, and something that would leave a real void in Lake Stevens if it didn't happen. I do have about 30 comments, citizen comments, that we collected through Facebook. I only have three copies. If I can pass it around and I just want to say thank you for your time, your service, and your um consideration.

Thank you. If you could give a copy to the clerk, then they can make copies for us. Thank you so much.

Good evening, council members. My name is Rachel her and I'm the secretary of Aqua Fest. I moved to Lake Stevens with my husband in 2017 and I have to say I love where I live. I grew up in West Seattle and every summer we had neighborhood block parties, street fairs, music, food, people, and of course the beach. Those are some of my strongest childhood memories. And I've lived a few places since then. And I haven't found that same feeling until I moved here. Like those street fairs, block parties, and events, Aquafest brings people together. They create memories, and they give our town identity. I wish I could talk about Aquafest today with the same enthusium enthusiasm as I did in years past. But instead, over the past few months, what we've seen is a conversation about whether a volunteer-run nonprofit festival should somehow be responsible for solving a city financial crisis. At the last meeting, council asked for an economic impact study. So over the last week, I did that work. Aquafest brings approximately 30,000 people downtown from Thursday night to Sunday night. That number is derived from facilities usage data. This is how we estimate attendance because Aqua Fest is free and open to the community. We don't charge at the gate like most festivals. During these four days, we host a carnival, a ski tournament, a car show, the aqua run, live entertainment, vendors, list goes on, and many free activities for families. Using conservative festival economic modeling, the same type used by tourism boards and cities across the country, I estimated that the average attendee spends about $50 during the weekend on rides, food, vendors, restaurants, and local retail. That is conservative. When you apply that against attendance, it's roughly $1.5 million in spending over four days.

And when you apply small city economic multipliers, that grows to 2.2 million. And because 70% of that spending is taxable, Aquafest produces roughly 90,000 to 110,000 in tax revenue. That's revenue that goes directly to the city. And that estimate does not include the increased sales and local businesses that benefit around us. Aqua Fest is not just a festival. It's an economic engine for this city. And here is the irony. Aqua Fest is a nonprofit run entirely by volunteers that managed to turn a $30,000 profit last year. And the city is now asking for all of that and more. So when we talk about financial challenges the city may be facing particularly those that have developed over the past six years solving those problems on the backs of nonprofits and volunteers is not only unfair in the case of Aquafest it simply doesn't make financial sense because the real question tonight is when a volunteer-run nonprofit brings millions of dollars of economic activity to a city should we be asking if we should charge it more or how to support it? That's three minutes. Thank you.

So, I'm the [clears throat] last person at least in our group. I don't have a green sheet for you, sir. But I'm gonna I'm gonna overlook it. I'm gonna Sarah asked me for who to do and I gave her the whole thing. I gave her the names and you said no green sheet. I said green sheets are in the back for public. I apologize. Go ahead, Chris. Thank you. [snorts]

So, good evening, council members. My name is Chris Jacobson and I serve as the president of Vakafest. As you heard from my wife Rachel her, we care deeply about this community. Before I go any further, I want to thank the board members. I want to thank the chairs and I want to thank all the volunteers. You're an amazing group of people that have so much love for this community. I can't even express how deeply grateful I am. Aquafest has been a part of this city for 57 years. It's been organized by dedicated volunteers, supported by local sponsors, and historically partnered with the city to bring our community together each summer. First, I'd like to acknowledge an important point. We understand that the city is facing financial challenges, and we respect the difficult decisions must be made. However, the situation before us tonight is not about long-term policy or future planning. It's about timing and practicality. Aqua Fest is just 100 days away and we still don't have clarity regarding the financial impacts. At this stage in the planning process, contracts have been signed, entertainment's been scheduled, the carnival's been secured, and permitting and logistics are already underway. However, due to this uncertainty, we have still not yet opened up vendor registration. The longer this delay continues, the greater the likelihood those vendors will commit events in nearby communities such as Sultan or Arlington. As Rachel mentioned, this is ultimately about where 30,000 people will gather in our city, contributing to our local economy, or plain simply, they're just going to go elsewhere. Aqua Fest brings this the diversity of our community together. It's a time where neighbors reconnect, new friendships are formed, and lasting memories are created. This event does not happen overnight. Requires a full year of planning by

volunteers, individuals who generously give their time, often at the expense of their uh personal and family commitments because they believe in this community. The financial uh changes being discussed tonight were introduced after our planning process was already well underway. Quite simply, there's no realistic way to replace that funding through fundraising with only a few months remaining. If the [clears throat] city would like to revisit how Aquafest is funded in the future, we're absolutely open to that conversation. In fact, we welcome it. We'd be glad to s uh meet to follow discussed uh sustainable partnership could look what what could look like for 2027 and beyond. But ideally before the end of quarter 3. However, making stigma changes to a 50 57-year tradition with only 100 days remaining places the entire event at risk not just for the volunteers but for the thousands of families, businesses, and communities who look forward to this every year. So tonight, our request is straightforward. We ask the council to allow Aquafest to proceed this year as it has in the past under the existing and previously approved budget. We respectfully hope the council will make the decision that prioritizes and supports our community.

Thank you, Chris. And I would love people to actually listen and get off their computer. The next green sheet I have is um for Rick Trout.

Hello, I'm Rick Trout. I live at 1706 123rd, the blue house right over there. Um [clears throat]

First, I want to second everything that's that's been mentioned here. I'm the first one uh who didn't write everything down that I'm going to say. So, this is going to be completely off the cuff. Could get in trouble. Um [laughter] but, um starting with family stuff, you know, we've we moved here in ' 03. Son grew up here going to, you know, the kid prayed, we had a dog prayed, we were just cleaning out a a bathroom. I still have uh ribbons from when my son was in the kid parade at Aquafest. And so, he grew up having a a carnival in his in his driveway essentially, you know, right in this area. Um, and and I'll kind of speak to two things uh regarding that. Number one, again, I don't want to put words in anybody's mouth. The seven houses that are mostly impacted here, I've never heard a single complaint about Aquafest. I mean, maybe when I first was here, I I was working for Bartell Drugs. Uh, 30 years at Bartell's, last 10 years at the one here in Lake Stevens. Sometimes I had to go to work, you know, in the late in the day when a parade was happening. So I would have to figure out the logistics, but nobody really complained about Ofest. We all love. Um, secondly, just my son as it was it was really neat to see him grow up from initially when they're really little and you're out there with them, you know, every every second that he's out there and then they get to that age where it's like, oh my gosh, you can go to the carnival with your friends and mom and I will hang back at the at the house. And it was just really neat to see he would see friends, you know, from school, from other schools. He started at Zion Lutheran. So he had a lot of friends from Stoomish that would come in. Then he had, you know, his middle school, high school, you know, it just turned into this really kind of community type thing. And it was really cool to see all these kids who, you know, now you hear everybody complaining that there's not a enough stuff for kids to do. Well, Aquaf Fest is an amazing weekend, at least for the kids that I saw. Um, a lot of our friends would come to our house and just stay for the weekend because it was too

hard to get in and out. We would have tents because all the bedrooms would be full. So, we'd have like tents set up in the yard for the kids and it would we'd just stay there all weekend. Um, as far as the financial stuff, that that's kind of a surprise to me. Um, kind of like Rachel said, I grew up, you know, in Burian area going to Seafare. Um, my my parents and grandparents lived in Yakama. They had Community Days, which was, I think, more of a veteran type thing, but it was still a similar type event. Um, you know, seafare they charge for. Community Days was free and Aquafest kind of reminded me of of reminds me of Community Days, you know, in the Yakamasila area. Um, do I have 15 seconds? Uh, let's just fund this thing because Oh, I know what to say. I I think my group alone one time we had friends up from Sacramento. We went to buzz in one morning. I think we bought 20 Bloody Marys.

That's three minutes. [laughter] Thank you, Rick. Thank you for watching Peter. All right, I have a couple of green sheets that were turned in late. I'm gonna um we're going to do these last two and then we're going to call it for tonight and move on to the rest of the agenda. So um the next person I have is Kim Dri. [clears throat] Who's that? [laughter]

Okay, first off, I'm Kim Dory, 2615 Lake Drive. I've never had to say that before. [laughter] I think most everybody in this room knows who I am, where I what I do, and uh how associated I am with uh the last 15 years at Aqua Fest, what I've done on that. That's not what I'm here to talk about. Aqua Fest is important. There's no doubt about that. The board has said what they need to say. It is a very important event for this community. What I want to talk about is community. I want to talk about the nonprofits. And I want to talk about history. Let's start with the history. When we had that old community center down here, we had to put a three things a three sink out there, stainless steel, put a hot water tank on it, and it was plugged into where the range was plugged in in the community center and shocked the crap out of people. That was when when I was getting involved with uh with Aqua Fest. Then on the council, we decided to turn down to tear down the community center. We decided to do a whole bunch of stuff downtown. And what you see is what we had been envisioned and what we had gone for. But the historical part of this is that what we have forgotten is the promises we made because we had so much push back on losing that community center by the nonprofits because they all used it. It was a very cheap alternative for them to do their meetings to have little little events. The library used to use it all the time for uh readings with the kids just about every day during the summer. That community center was wellused and it showed it and it needed to be torn down. But we promised the nonprofits, of which there's probably four or five represented here tonight, that we

wouldn't affect the nonprofits. And what the council did a little over a month ago definitely affected the nonprofits. They've been priced out of the community center. [clears throat] That's the history. And you all need to know that because there's a couple of us that were still on the council when that happened and we've been voted out. Got it. I'm actually enjoying life again. Got 20 hours a week back. This is great. I'm not running for mayor. Stop it. Quit calling me. Uh I just want you to understand what you're doing to the nonprofits. They cannot afford this anymore. It's just not in the cards. So, you've lost that part of the community.

Thank you. Last screen last green sheet I have is I think it's Keith. Yes. Thank you for your time. Um I'm Keith Perry. I own Jay's Market Across the Street. Um been a part of this community for 20 plus years as a owner of a business and uh I've watched this business be something that's beautiful and grow with the community. We're all here because Lake Stevens is a beautiful place to live. I didn't come here with something to write. I came here with my heart. Uh I think Aquafest has been a beautiful part of our community for many years. Um I've loved it. I love being a part of it. Um, adversely recently in the last five or six years, it's been difficult for our business to run during this time because we are um overwhelmed with the amount of people that come to our market and either steal from us or cause us um a lot of anguish. It's difficult for us as a small business owner to be in this part of the community. As we look at other communities and how they do their festivals, they do it in like Snowomish, our closest. They do it in the field outside of Lake Stevens. I mean, outside of their downtown area, we have to deal with these 30,000 people in our backyard. It's difficult. And like our previous council member said, I did it in the past because that money went back to give people turkey dinners and Christmas gifts. So, I do agree with them. It's tragic that we're not going to have those service community values back there because I was a part of that in a lot of small ways helping those communities, those small the Kanas, the Lions give back to our communities, I can see it grow everywhere else. But what we're doing right now and what this is doing to our community by not allowing it to go forward, it's sad in a lot of ways. But the only thing I would wish I could and I've had conversations abruptly with Chris is that we could be

a part of as a downtown community and they can be a part of us and let us understand what's going on and be a part of what is this big picture because we're left out. We're left out the whole entire time. We're asked to just buckle up and take the ride. That's hard for us. We've had to endure the whole downtown reviolation. It It's been hard. It's hard to keep that. On an average weekend on July, I do about $18,000 on a beautiful day with that that beautiful boat launch open. And I love it. And I love supporting my community. When Aqua Fest comes around, I do about, you know, $11,000 and I have four times the amount of people in my store. So, I have to staff more and I have more theft. I'm not saying I don't like Aqua Fest. I don't say I don't hate it. I just want to have a a community event that we all are rewarded with the idea we can sit here and talk about these economics where they think that these 30,000 people are walking through my door and they're giving me everything I can because if it was, I'd give back to those service communities. I would. Every inch of my heart would tell you I'd do that. But I'm not to tell I'm not going to tell you that anymore. It's not the case. It's too big of a vent. and if they want to include us and let us know how this is going, I can't be a part of it. I'm not going to support it. If they want to open that door, I'd love to have it. But right now, it it hurts my business and I'm considering closing for the first time in 20 years during this event because it's so hard for us to be a part of this. So, I thank you all of you for your time.

Thank you so much. Thanks to everyone um for taking the time for public comment. Much appreciated. The next item on our agenda is an action item. Uh the Aqua Fest 2026 2026 inind request. Uh I'll turn it over to Sarah.

Thank you. Uh good evening, council. Sarah Garco, parks and recreation director. I provided a staff report as well as some supplement attachments. Um, I since had also emailed out one revised financial attachment just to help break down how um the money is divided between columns. I can share my screen if requested, but I didn't prepare a uh formal presentation. As stated here today, Aqua Fest is the largest special event in the city of Lake Stevens. It started in 1969, which is 57 years ago, and has grown into the event that it is today. Uh that of course includes the Lakeside festivals, parades, fireworks, and uh lots of community involvement. They are a 100% volunteer-run organization and a 501c4, which is a civic organization that is a not for-p profofit. Every dollar raised goes directly towards producing the events and expenses. So um profit from last year would roll over into this year in order to pay deposits and um allow events to function is how that works out on the financial side. Um the breakdown of the request for 2026 is um preferred to copy and paste the support that was held last year by the city. That is the number one request from Aquaest. That would include full uh rental of the mill with 100% fee waivers. Um, from that uh the we identified about four different items that could be reduced or modified if it is the city council's desire that would have a small impact on the event. Um, but anything outside of what is written down in the charts provided would be a larger impact to the event. Um, I know we have Mariah here to represent Aqua Fest. council has any direct questions for um her or for myself, I'm happy to answer. And again, just let me know if you want to share my

screen. I open it to council discussion. Thank you, Sarah. I would request you share your screen, please. Absolutely. So, I will share the last one that I shared out, but I am absolutely able to switch between the other ones as well. I'm just looking for the share button. [clears throat]

and rip life. So at the top um you can see the inind contribution that is approved within the city department that is the equivalent of about just shy of 19,000. I'm going to zoom in here at a request. There's a screen. That's

And then the bottom portion is what's coming to council to review. So on the main left hand side, I broke down what council has to review. And then on the right hand side, I just added that to total effect as you go down the different line items to show would it reduce city expense, would it increase aquaest expense or is it simply removing the support? Uh, so one of the proposed items is on Saturday and Sunday, city staff is provided at the quantity of two to help with restrooms and trash. So that's the first one on the list. Thank you, Sarah. You're welcome.

Can can you clarify a comment in that? You say staff support on that specific item. Aquaest is working to secure a green team. If successful, this will have no effect on the event needs. I didn't follow what you're trying to say there. Um last year specifically um there was not a robust green team and so the Aquafest board did a lot of the trash management. Um but with that there is a high need to have the trash pulled more often. Um we were planned to have one city staff on Saturday night and we held a second city staff into the night. I personally also pulled trashes for over an hour.

Yeah. I just I don't understand if successful meaning if they can secure a green team this will have no effect on the event needs. What what I don't know what you mean by that. If we reduce staff from two from the public works park side to pull trash. If we reduce that to one and there is a green sleeve. Okay. Then the trash and restrooms will still be serviced as needed. Understood. Thank you. Absolutely. Other questions for Sarah? So, I just want to make sure that I'm seeing this clearly. It says um $18,869 has already been approved by the department for um Aquafest. Correct. Correct.

And so today we're being asked to approve an additional $41,000. Correct. Okay. And that breakdown is on this very small and large spreadsheet. Um it is available in PDF. I can zoom in or scroll around to anything that you desire. Can we clarify on that whether the Aqua Fest donations are in the budget or not? Because I've heard both it is and is not.

Absolutely. So, Aquafest does not have a line item in the budget for the city of Lake Stevens. What it is is we have our overtime budgets for each of our departments. And as you look year to year, our overtime budget for this year is the same or round about the same as last year. So, we didn't remove these costs from the budget. Of course, if it's not spent, um, then we will come in under budget or I know that the council is looking in supplemental budgets in the future. So, is it fair to say that the overtime that was spent um by the city last year um was covered under the budgeted overtime for last year? Um, I would have to look at the other departments and their ending balance for overtime. I know parks and recreation exceeded our overtime budget by double.

Okay. And that's including the Aqua Fest. All events, correct?

Yes. So, I guess as a newcomer to council, um when I first started digging into the city's involvement in Aqua Fest, um I had I had seen a number not nearly as high as $59,000. Um and even that number was kind of a shock as someone who had never had any experience with what city had supported with Aquafest. Um upon that, you know, I had asked around to some other um council members um and other community members that are involved um in nonprofits and no one really knew what the city had been supporting for Aqua Fest. So whenever anyone heard that number, they were like, "Holy cow, that's huge. Why did we not know about this?" like um and so as someone who is involved in multiple nonprofits, I fully understand the struggle um when it comes to find funding for events um and I empathize with that. I see that um Aqua Fest is a huge important event for our community, whether it's, you know, economic or socially. um as a new council member coming in, you know, I'm I was elected to um make decisions for the people that I represent and it's clear that many people in Lake Stevens want to support Aqua Fest. My concern is um before the parks department was um developed in 2023, no one really kept track of how much Aquafest was supported by the city. It was just kind of like, oh, you need support, here you go. Um, and I think the fact that we are able to now put a value on what we're supporting with is important so that we can keep track and make sure that not only are

all of our nonprofits locally supported, um, but there's no favoritism. And I understand that Aqua Fest is a huge event compared to some others. Um, I also want to note on um the the community center. So, I was one of the people who used that community center. Uh, I think it was $10 an hour for nonprofits to rent. We had repair cafes. We had all of these things. And um, we were told not to worry. We would have a place that was affordable that we could be having these events. That's apparently not true, right? We never got that. We have the mill, which is amazing. I love the mill. It's a beautiful building and there are some great events that are held here. Um but we we are here now and we have to be conscious on where um expenses are going and so with that um you know we're all tightening our belts. The nonprofits that I work for um we're 100% strictly donations. Some of them who even uh hold events here in the city and have received zero contribution. Um, and so I just again I just I want to make it clear that this is for me personally absolutely not um anything against Aqua Fest or its organizers, but fiscally looking at these numbers as someone who had never seen them before. It was shocking. Um, and I hope that that people can understand that. But um, on that note, you know, I would I would love to vote to support Aqua Fest. Um, but I'm still kind of struggling at that $59,000. So, um, you know, if we could get a green team, has that is that something that has been looked into for this year? Um, you know, I see that Aquafest would u potentially be paying for their own garbage bags and for their own cones. Um, if the overtime is in fact budgeted, not specifically for Aquafest, but in general, then I could see we may have a

little wiggle room for that this year. Um, but there's a lot of stuff on this line item list that I think um, [clears throat] you know, should be reconsidered. Um, and I I do have some questions. Um, last year I know that Aqua Fest had was it the first year that Aqua Fest had um, a for-profit beer garden in the park here or was this the second year of that? We're invite Mariah up to speak on behalf of Aqua Fest. So, and I want to make sure that we're focused first on questions. And so, um, we have an opportunity to ask Sarah questions and then Mariah is going to be available to answer any questions directed at Aqua Fest. Okay.

Would you like to repeat your question now that I walked up here? Now I got distracted. Um, you asked about the for-profit. Yeah. So, um, the beer. So, one of the things that drew my attention and also the attention of others that I have looked at this um with is that um you know we as a city are gifting um specifically the observation deck uh for Aqua Fest to use um [clears throat] um it's listed here as the um in kind allowance. So where's

correct? So all of the facilities other than the mill are at 100% approval at this point. So that approves the observation deck which is the area that's wood that overlooks the lake. So Aqua Fest is not paying for that. Correct. Okay. Yes. And last year was the first year that you had a beer garden inside of Aqua Fest. Is that

correct? So in years past we had used that observation deck or a similar area up there and we used that for our VIPs. So those that had donated quite a bit of money in order to have the event, we had invited them in, catered kind of like a dinner on the Saturday night. Last year was the first time we opened that up then to more like a a small beer garden. The beer garden that's typically held uh behind Jay's Market was run by Kuanas and that was a separate permit and separate from Aquafest at that time.

Yeah. And um from and I'm actually a volunteer. I volunteered a couple of years for the beer garden at Alto Fest as well as Aqua Fest main event last year. Um, and so the reason why I'm asking is because um, you know, the Kowanas beer garden is not happening this year. Um, and part of that is due to not having the income from people here in our community supporting. Not that the beer garden wasn't supported, um, but it it just people kind of raise an eyebrow when they see the city paying for a spot for a for-profit business to set up shop. So my question is, does Rustic Cork, which I believe is the the business, do they um give any of their their funds to Aqua Fest and if so, to what extent?

Yes. So they are a sponsor of the event. um they bring in the alcohol and then they split the profits with us. And so last year we received uh 500 I believe 600 from Rustic Cork for having that event up there. Thank you. Kind of along that line, I'm concerned that um Chris, are you the president of Aqua Fest?

Maybe. [laughter] and our parks director have different answers to whether or not that's included in inind. And so I have some concerns about the conversations that were had prior to this public meeting and if everybody was on the same page and we're asked to make a very important decision and it doesn't sound like everyone's on the same page and I and while I absolutely recognize how close this festival is and um how important it is to the community, my question is because I know we're supposed to stick to our questions. Are we even ready for this meeting? Because it doesn't sound to me like we're all on the same page here and I I'm not comfortable making a decision when we've got two groups that haven't gotten together and had a reasonable discussion where we're all on the same page. Let me clarify that I have been working with Aqua Fest. Um we met last Monday. Um came to council on Tuesday to give my update and then on Thursday I attended the um Aquaest board meeting virtually. they were unable to secure a time separately to meet with me between now and then, but at that meeting um unfortunately I know Chris and Mariah were were gone from that. I'm assuming they they caught up on minutes, but it could be that the conversation that we had there, you might have some information if you feel that one person didn't have all of that. Um I would say that this is a a correct accounting of the event and what the city is and is not providing.

Why are you shaking your head? Um [clears throat] so the big the money that's in there is a police. Hold on. If if if we're going to allow speaking, you can answer the question, but I need you to speak into the mic, please. Thank you. I'm just saying cuz this is the board in the front row.

So, yes. So, so the largest expense in that 59,000 that you guys are looking at is uh police overtime. That's the largest amount. The amount that's given on there is $150 an hour. That is not what the city is paying. That's the contracted rate that we would pay if we were going to pay the bill. Um the the police officers are not getting $150 an hour for their overtime. So the city amount the city that the city has to pay is much less than the amount that that you're being given. Thank you for that explanation. Sarah, do you want to uh respond to that?

Um absolutely. So the billable rate is set by the finance department and the finance department does look at the actual expenses for hourly wages including all taxes and benefits that we have as a city and all of the police are on overtime shifts. They have to have their normal patrol out to support the city and all safety needs of the city and then extra officers are here for Aqua Fest. Um and we did speak with police and police was at our first meeting. We are at the bare minimum. Most shifts there are only four officers plus one person at incident command. Where we have more officers is to support the runs and the parades. And so I understand it can be um hard to understand the real costs of of cutting checks by the time the finance department cuts them, but those are accurate costs.

Yes, Councilman Packard. Um, [clears throat] I appreciate all the comments today. I I appreciate the dialogue around the individual line items. I think we should have that, but I do agree with some of the comments from the council, sorry, from the uh Aqua Fest board that really like this is a matter of timing. I think the timing is poor. I don't want to hold up Aqua Fest. If we want to talk about something in terms of substantive changes to how we want to fund this, I'm fully open to that conversation. I think we should have it. I think we should be very uh careful about how we're going to spend our money as a city and consider all of those needs. I just don't think that we should be doing that right now. So, I won't go so far as making a motion quite yet, but I propose that we pass this now. If we continue to have the discussion today about specific line items, happy to do that. But um yeah, [clears throat] I I really just would press that timing wise we should approve it and explore details and opportunities to adjust down the road.

Yep. So, we need to finish up with questions first and then there'll be an opportunity to make a motion and then we'll have plenty of time for discussion.

Sounds have a question. So, great. Great. Uh Sarah, first off, I apologize if you answer this at some point. Uh until very recently, I did not realize there was an updated version of this sheet available to us. I'm now up to speed on that. Um, I believe last week I saw a number that was roughly $47,000. And I I asked a question along the lines of we don't expect our contribution this year to exceed that. And now I'm seeing this $59,000 number and I'm wondering if I'm looking at two different numbers or if the number has really gone up by that much. Um, trying to figure out where I missed something between now and last week. The number that was on the spreadsheet that council has been focusing on is the one in green under city expenses fee and waiverss 41,000 1980.

Okay. So the addition of the 18,869 is the in kind that has already been approved by staff. I have never presented those in a sum total to you before which I did on the right hand side to ensure you got the full picture but also if one staff was removed it it wouldn't it would just go away versus where would Aquaest reasonably have to pick up expenses on some of these other decisions and that way you understood the impact in looking at these. Okay. So that the 18,000 was always in there. We just had never seen it lump together as the takeaway.

Yes. Where it is on on this screen is the number just to the right of the 41. And so the total here 59 was often overlooked likely in our conversations. And you can see the columns here with inkind and needs council approval. Okay, that's what I suspected. Thank you. You're welcome. I have a question. Yes, Sarah, just a quick question on the followup on the cost headcount for police department overtime. Um, I'm imagining, yeah, the officers aren't getting the entire chunk of pay, but I'm sure that that overage is to pay for coordination of scheduling, other benefits that have to be considered with overtime. Is that accurate to get to that 150 number? Um, they do not get paid 151 per hour, right?

Um, but they get paid their wage plus all taxes and benefits. And I'm happy to pass that over to our finance expert. No, I just want to make sure that we're clarifying that that it's not a direct line cost of here's the hourly rate and that's what they pay. Right. Correct. Includes the city's cost on includes insurance, taxes, all of the items you have to pay.

Right. And I think everybody wants to see Aquafest go. I think everybody's kind of surprised at the number. But I still think if you put that to the community that city was going to spend 59,000 on Aqua Fest, they would be fine with it. They would be happy with it. They were fine with it. I'm sure they would point to a million other things we wasted money on in their minds, right? that came up with this number. But not to get into that, I think I agree with uh Councilman Packard. I think that this year with the burden of time that we have, I would think that we would I would recommend that we move forward. [clears throat] I would however say that Aquafest committee for next year needs to really do better on getting that number down proactively ahead of time and work with the city to do that, right? Yeah. And and we're open to that is the best way I can say it, right? So, uh I that's all we really have to comment on. to vote.

Councilman Shippen,

I have a question, not a comment. Um, [clears throat] my question is, as I've listened to the board come to the podium and speak that it takes a year to get this off the ground and and going, you know, a lot of time, a lot of effort. When did they reach out to the city? Did we approve all this in advance and now we're going back on it or did they or did the the board just recently approach the city to clarify that oh we're going to do the same thing we've always done? Are we going back on our word? So in other words, when they first started planning the 2026 Aquafest, had the city agreed to 100% in kind and now we're changing it or by the time they reached out it had already been changed. one of our park staff sits on every board meeting to help answer questions and facilitate [clears throat] things. Saying that, it's not me. Um, however, I I do believe that it was expected for the same level of support to continue. Although, um, I will say at least a couple members of the board were aware that this was going to be a topic the inind program would be looked at and a portion would have to come to council to approve. I don't believe that we've ever actually sat down and and looked at numbers and I understand that this didn't happen last July. It's happening in in February and March. And so I think probably the most concern is how close we are to the event this time.

And I would add to that as an Aquafest board member that we learned about it through council's meeting in February. We were not approached ahead of time that that would be a change in what support we had been given in years past. And did you reach out to the city when you began planning 2026 to clarify how much inind donation the city was going to provide as you were planning this far into it? Especially if you knew we were going to discuss it. I did not know you were going to discuss it. Um I misunderstood.

So we did not have that pre-warning that that would be a different discussion than we had always expected. And we had a city staff member like Sarah said in all of our board meetings that never brought that up that that would be a change that council was considering. Okay. Mayor. Yeah. Councilwoman Aria.

Thank you. Um thank you for everybody that was here. I think my questions throughout this process since the 20 since the February discussion which was brought to council as a discussion item. Um but the way it was it it was am a bit ambiguous on what exactly the action item was. I think what my impression at that time was that we are agreeing on modifying the ININD program but there was no specific implementation date attached to it. And I think um at that time as my fellow council members uh we're all looking at the budget uh primarily for next year knowing that this year it'll be a little bit of a tough year. So with that in mind um I was surprised that it's a it's an it seemed to be an administrative decision to modify the ININD program um that was not put to action to council. So therefore, it it's a little bit difficult to be brought for council action now to modify or accept when we haven't had a prior action on the subject. So I'm I'm having a little bit of a difficulty with that. With the facility fees, I think the conversation was more about how do we treat that for the whole group, not just Aqua Fest in particular. And now it seems like we're asking for an exemption to the exemption to the nonprofit fee which is very difficult to process, right? Like

so I would um that to me is it it seems that we should treat everybody the same in the inind program in terms of the facilities fees but implemented next year. Um so looking at the timeline um and the second portion of that is the staff and overtime. I think most of the contribution for the city relies on police overtime and availability. And so because it is not a department budget item or a program item.

It is not um a budget amendment that we can vote on. So it is very again it's very difficult for me to come into the conversation and say yes to staff overtime or police overtime when that is a departmental and city administrative uh judgment call whether or not it fits into their budget. I'm assuming for police the overtime for the event would be covered by the vacancies that are budgeted for this year. So, I would want the chief to answer the question of whether or not that would be covered in this year's budget. Overall, I think that this shouldn't have been an action item. Um, but it should be incorporated in the budget so that council can have a say in the amount, whether we cap it at a certain amount or where do we take the money from um so that we can vote on it. Um, but I'm having a hard time otherwise with what we're being asked to vote on tonight.

Um, Director Garo, do you want to respond to the um the question, the comment um regarding council's role tonight and what what we're voting for?

Sure. Um when we brought forward the inkind uh program um that was to specify what staff had the ability to say yes to when it came to special events specifically. And so that was not an action item and was not meant to be an action item but to get a consensus of the board of how to handle these as we we move forward. And so we simply said we can do the 18 talking about Aquafest we can now approve this 18,000 in house because of the line items that fall under it. These other ones are just to come forward for council review to say yes go or let's look at reducing the cost for the city. And so the council's role in this is to tell us as staff what to approve for Aqua Fest or what to bill for. And so really with this it is all about this this $41,000 and do you want to provide the same amount of support as last year? Um, as I mentioned before, yes, we have the same overtime budgets as the prior year. The only department that saw a decrease in budget that I am aware of to any large sum is the streets department. Um, but with that, that's the public works side of the public works and parks costs. We can work that out with the one or two staff members that are approved in this. Police have the same budget line item as last year, unless I'm misspeaking. And he's nodding yes. And so technically, yes, it's in the budget, but that is always our maximum budget authority to spend as staff. And we of course have direction to not spend what we don't have to moving forward and to be very budget conscious. And so that's really why these changes are coming about and having that double check with council about these larger items.

Thank you, Sarah. One more question. Thank you. Did the 2025 council and the city have a line item budget for aquafest support

in the 26 budget? No, there I believe that going back to either 2022 or 2023 that there may have been a line item over in the general budget that said Aqua Fest, but really it was any other events that also had cash contributions. So that would be where we paid for the trash bags and for the dumpster rental. But no overtime came out of that budget. It has since been turned in I think maybe two years ago to actually um event support. I'd have to look at the full title of it but for instance music of the parks was paid out of that.

So there was money attributed to Aqua Fest in the budget but it was comingled with other events as well to create a budget number. Correct. Yes. And I believe the number this year may be a total of four or 5,000 total for what is the special event aqua fest and that's how we pay for the consumables or the the rental of the garbage specifically. I think next year council will have to take a look at it and actually make that a budget because $59,000 is in a slight smack. It's a big hit, right? And if we budget for it and the community wants it, that's okay. Thank you. Any further questions?

Um, one more question. Um, did this come to the council? um as a an approval in 23 24 and 25 for that year's event. So we spent was it 47,000 last year? Was that approved by council ahead of time knowing that the year before we had 30,000 spent or so? Um so why the difference? Now

to my knowledge, this has never come to council for approval in advance. There may have been a couple of years prior to my um being here with the city. So prior to 2022 where there was an after report where Aquafest came to say this is what our event did for the year but there was no cost accounting internally with any of our departments other than police who do a great job accounting all of their overtime for what that meant as an event and the department certainly weren't creating one report to show um that has been one of my large lifts since I've been here is really creating programs where they weren't writing policy and then cost accounting really to show the realistic cost of running a parks department, special events and the programs that we manage.

Thank you. I have a qu another question. Um so one of the comments said um that by the end of Q3 would be a good time to know what the city can um give. Um when as far as the budget, I was not here last year for budgeting. So, I know that the budget wasn't finalized until what? December.

Yeah. So, I guess um I want to make sure that everyone knows the budgeting process because there are some things that we just can't do faster. Um I guess my next question would be for Aqua Fest. Um what's your process as far as like um when you sit down to start planning, when do you typically bring the ask to the city for the funds? So, first of all, we've never had to bring the ask to the city for the funds until we do our permitting process. And in there, there's a inind request that we fill out just like we did this year. And it happens at staff level in years prior. So, there hasn't been a formal ask that's ever been needed as a dollar amount.

Okay. And that's I guess on the on the request for funds that I have seen, it has been um I assume a a board member that has submitted those requests. The one that I saw was uh Mr. Dory. Um and so I feel like, you know, maybe there was a little bit of conflict there with having a council member just submit that to be accepted. um our change of of inkind donations that makes sense that you know now you would have to come to us for for approval because we just changed that policy but I think I think that we need to look at our previous policies and make sure that we're not making these same mistakes.

So I'll just clarify one thing. Um Mr. Dory's name is on the permit application typically and the inind request comes from treasurer which was myself and then by city um requirement it needs to be signed by the president of the board. So Kim has served as president. So in that year he probably signed it. I have served I've signed it and then Chris Jacobson has signed in the last couple years.

Thank you. I have one um process question, Sarah. The council will take some sort of action tonight. We either will um make a motion and pass it, make a motion and not pass it or not make a motion. Um if a motion is not made or if it doesn't pass, then I just want to make sure I understand, then the inind contribution for Aqua Fest would be the $18,869. Is that accurate? That is what I have the approval to say yes to. Okay. I would highly encourage the council to come to some kind of conclusion tonight. Okay.

So that Aquafest can proceed. Great. I just want to make sure that that what the consequence is to each of those actions. Thank you. Any further questions? Yeah, just to clarify because we we've kind of gone around it a bunch. I want to solidify my own understanding, but just make sure it's clear on the record. What we're being asked to approve tonight is not a budget amendment. Correct. We are not It's essentially money that's already in the budget, but we are approving above um staff's threshold. So you staff is okay to approve up to 18,000 to go beyond that. To approve money that's already in the budget, you need council approval on this 41,000. Correct. Is that a correct way of stating it?

Correct. This would not result in a budget increase for the departments. Okay. Thank you. Any further questions for Mariah or for Sarah?

I guess another process question. If you are to change the ININD program effective date from 2026 um that you just implemented two months ago um or a month ago from 2026 to take effect in 2027 then all of this would not so the mill and all of the nonprofits that would have now been charged or um would that then move that were proceeding as last year or in previous years with the inkind program and then we can look at the budget impact for 27. Would that be a a solution? That would be better. [clears throat]

Um that would mean that I would not bring back any additional events uh to you. Um one of the problems we may run into is that there are some new events coming into file this year who haven't prior asked for requests. Um, so those would add to my budget likely. Um, we could absolutely have a consensus for staff to hold off on implementing this until 2027. Um, my concern is then we may have the same situation in 2027 with a lot of groups. Um, I I really think that there is a simple solution here that if it is the council's desire to support this event at the same level as last year to approve this. Um, if we come back, it likely will only be two or three additional events. We're setting a precedent with all of the new events that this is the end program and to ask for more, we don't know because that hasn't been provided before. Um the other events that we're working with that may come forward is um Fourth of July if they want to use the mill um or or some of the other large downtown ones such as a triathlon. Um but I wouldn't expect us to keep having this conversation with multiple events throughout the year. I would just caution that you by deferring to 2027 may then have this whole conversation again in one year from now.

Thank you. We now have an opportunity to um make a motion or not make a motion. Uh by making a motion that will open the door for further discussion. So I am looking to see what the council how the council would like to proceed. I move that the city approve support for Aquafest 2026. I second that. Can you repeat that? I move that the city approve support for Aqua Fest 2026 as and is that at the same level as Yes, sorry. At the same level and I'll second it.

So, we have a motion and a second. Any discussion?

Yes. I would just like to now echo Council Member Packard and Council Member McMast's comments. Um, I definitely think some, you know, fiscal detective work is warranted here and there are things we can do, uh, both on our side and in partnership with the board of Aquafest to bring costs down and, you know, evaluate the city's inkind contribution going forward to be financially responsible. But ultimately, to me, this is an issue of timing and promises made. And I I can't really point to any one thing and say this is, you know, this organization's fault, this person's fault. I simply think that, you know, wires got crossed and support was, you know, compromised when it was not meant to. It was compromised very late in the game. I don't think anybody intended that. I think we all appreciate this event, what it means to our community, and I think the best path forward would be to make sure it happens this year, and then have robust discussions about next year with plenty of time to have those discussions. And I would also make a a comment that um as part of discussion that this becomes a line item for the budget for next year. I would also add that all the other organizations that were discussed or on the list on the February 24th that are impacted by this new um program change that would like to follow the same process that Aqua Fest is is following to contact the city and come back to us. And um I speak for myself when I say that I would be very amendable to um looking at the in kind program for this year and not have a short amount of time for people to plan their events and be burdened or not be able to to have them. So

I would agree with that.

And I would like to say I I don't think there's a single person sitting up here that doesn't support Aqua Fest. Um, I understand that there's challenges to some of the local businesses for sure. There's challenges um for traffic and parking and you know, there's all kinds of issues. Um, there's also a ton of benefits. I've lived just a mile away from downtown for over 25 years. My kids grew up walking to Aqua Fest. Um, I don't think there's any of us that are saying Aqua Fest isn't important, but this is what I do want to say. We came up with an inind process for a reason. I do not feel council should be picking and choosing who deserves money. I think the city should have a process for end that can be budgeted and can be consistent and can be fair and can be nonbias. And that is my challenge with what's going on is that inviting different groups to come up and say, "Oh, if you don't like our inkind policy, come ask for a waiver." Then puts our council in the position of we get to pick and choose instead of it being a city policy, which was the whole reason for us doing it. Um, this last council I was part of, we worked hard to balance our budget and we made hard decisions and we made our department heads make very challenging decisions. And when they came back later because they needed a new operating system that our city desperately needs, we went back to them again to three major departments and said, "Find us $34,000 more each department you can cut." We're talking about not filling vacancies. We're making some very, very, very challenging situations because like everybody else currently, we're not making as much money as we're spending. We see households dealing with it. They've got to cut spending or go

into debt. We see businesses going through it. They've got to cut spending or go out of business. They can't continue to increase prices or they price themselves right out of business. We have governments that aren't pulling back their spending and instead are increasing taxes. Our city did a very very focused effort to balance our budget without increasing taxes. And one of the difficult decisions we made is to make changes in our inind policy. And I think those changes were warranted. So having said that, I'm a person of my word. And if we led Aquafest to believe none of this would apply to them and they don't have enough time to rebound from that and we've got it quasi in our budget, then I'm in favor of approving it for this year. But next year, I mean, I'm telling you, work on those volunteers, right? Um I also fully understand that with the pandemic, it changed everything in this world. Everything. And one of the things that changed with Aquafest is we lost our carnival for a few years and our board was very amicable in saying we'll change the weekends, we'll do whatever we need. From what I understand, we end up stealing Sultan's carnival um to get that carnival back here. And so I appreciate all the effort and time that went into that. But I am going to ask Aqua Fest and those supporting Aquafest to recognize our big hearts don't pay our bills, right? Our wanting our wanting to support and be kind, do something doesn't pay our bills. And that's why we have an inkind policy, right? And it's not because we don't want to support nonprofits at all, but we got to pay our bills. And if you look around Lake Stevens and compare it to other communities, we have a thimble full [clears throat] of commercial

property to pay those bills. And when everyone talks about your property tax, 7% of your property tax goes to Lake Stevens. A very, very small amount. And that goes to the entire city. So, I just want to be perfectly clear that we are not heartless up here and saying we don't support Aqua Fest. It's unfortunate that it's reached this this place where I feel like there's some hard feelings because that's not who we are. But we are put in the very difficult position of balancing a budget in an economy that is not friendly to doing that without raising taxes and we didn't want to raise taxes. So having said that I feel we should stand up to our word. Um, but next year should look different. And I'm a little nervous about every other program coming to us and saying, "Hey, how about you encourage taxes and we need to look at ways to cut spending and capture revenue where we can and that's the whole reason we have this policy

further

further [clears throat] discussion. So I'll I I'll want to make a comment on that. Um I think a couple of things. One, this was not a budget discussion item for this year's budget. It was incorporated and assumed. So, um the inkind policy was changed by the city in late February and I think that to be fair with all the um organizations that are affected by this policy, this is why 2026 is the year that if we're making an exception to the changed in kind program for one organization, it's only fair that we would make the same change or u allowance for other organiz organizations that are smaller that may be not affording that and may be needing more time to prepare. So what I've heard from, if I understood it correctly, from the Aqua Fest organizers is the same. It's the time crunch. It's the um willingness to work with us on in the 2027. Um, our request from the city has been to put it in the budget item, whether it's staff budget or an actual budget line item, so that council can actually uh evaluate trade-offs when we do have the conversations. Um, and I think that's where we are. Um, yeah,

I just want to remind council discussion time is for us to discuss am discuss among the seven of us what we need to discuss to be able to come to a decision. So, it's not an opportunity for us to speak to uh the public. Yeah. And we also have a motion on the floor. So, we really need to be talking to the motion at this point. Thank you. Can I ask Sarah a question? No. So, okay. Well, question. Can I ask a question about the process of motions as I'm new? Yes. If I make propose an amendment to the motion, we would then vote on the amendment first and then we would vote on the amended. We vote whether to add the amendment. Correct.

And then do a separate vote of whether that motion with the amendment or motion as originally proposed.

Okay. I'm going to make a motion to amend the original motion that we Yeah. defer the implementation date of the ININD policy for all nonprofits who have previously worked with us before until January 1st, 2027. So that anybody who's done an event here before uh can operate in 2026 under the previous policy. If new uh nonprofits want to move forward and do an event, they have the policy in place and then we can move forward and figure out 2027 impacts on 2027. Beyond that,

we have an amendment to the motion asking that we delay the implementation of the inind policy to 2027. Do I have a second? I second that. We have a motion. I just want to clarify that is only for existing nonprofits people who have done events with us prior not new events [snorts] that we had in in February that you had presented the inind program. So we have a motion and a second. Thank you for clarifying discussion on the amendment.

Yes. I so I I support the intent behind that. My my question is more or my concern is more procedural whether amending the original motion on Aqua Fest is the appropriate vehicle for enacting that or if that needs to be its own separate item brought before council. That's fine. I mean I'm not particular about how it happens. I agree with the intent behind it. Yeah. I just don't know procedurally that's the way to do it. And and I think because that wasn't a focus of the presentation or discussion, I think that item might deserve its own discussion and further information to just to Councilman Donny's point.

And a discussion further on that is I think that may also require a budget amendment because our parks department is budgeted based upon mill rental projections. And if the mill rental projections were based upon a 50% reduction limit, then that affect the mill projections in the parks department's budget. Greg is if you want to take his comments. Greg, are you wanting to say something? Um, can you hear me? Yes.

Yeah. I was just going to say I I I think the emotion to amend is is really out of order. It speaks to a different a topic than the motion on the floor and and that it should be handled as a separate item. Thank you, Greg. Noted. Would you care to I will redact or whatever the appropriate word is. Retract. Withdraw. Withdraw. Yes. Whatever the appropriate word is, I'll pull that back and we'll move forward on the original motion. Can we have this as a motion for next council meeting? We can have it as a um discussion or action item. I think we'll talk about that at the edition.

Don't we have to resolve the pending motion? We can Yeah. Let me just restate. So, the motion on the floor is for the city to approve support for the 2026 Aqua Fest as the in in the same level as last year. Correct. Any further discussion? All right. Okay, then I would call for the vote. All of those in favor of supporting Aqua Fest at the 2025 level, please say I. I. I. Any opposed? Motion passes.

Thank you. Moving on to our discussion items for the evening. The first discussion item is the 2025 year-end financial update, and Matthew will be leading us through that discussion. [clears throat] Maybe we'll wait 30 seconds until the room settles.

Thank you, Caitlyn. All right, Matthew, you have the floor. All right. Thank you, council. Um, my name is Matthew Heis. I'm the finance manager here and um, move this over here.

All right. Um, so yeah, so I'm just here today um, tonight to provide you just an update of what um, 2025 year end um, looks like on the financial standpoint. So right here um as you see on the screen here is that uh this is just a picture of where our revenues, expenditures and ending balances. And as you can see in the green um line there, that is our budget of what was budgeted. Um and uh in the red there is what is the 2025 year end and 2024 is um is the 2024 year end is the blue um as well. So to just kind of see that those comparisons. Um and then down below the actual numbers as you see there. Um down below um I do want to point out um as you you might see uh with our budgeted revenues and even expenditures um that there's there's a gap between there. Um that is the gap is because there's um mainly due to uh grant funding um that we that we had anticipated that we didn't get in 2025. Um but we do um do anticipate in getting that in 2026. And mainly that's because of projects. Um that's also um in line with our expenditures um as well. Uh because usually grant funding is reimbured to us. Um so if we're not spending the money, we're not getting that money back. So um so just kind of want to point that out and that's why um you'll see those differences. Um right there might have questions on that. Uh right here are major revenue sources. um citywide. Um you'll see that we'll have um that there's right here on the on the left side are the sources. Um we have the funds of where those are coming from and those are kind of those are grouped together as you will see there and also the uses which means whether or not

those are restricted or unrestricted um meaning that the use of those um are restricted or not. So uh so over to the right side you see some yellow highlight ones and those are highlighted just because they were more significant um changes as you see um as we see construction sales tax was we had budgeted. So, I just hopefully you guys don't get too confused that that 20 the far right there is our 2025 budget versus 2024. Um, that's not those that's not our actuals um to actual. That's budget to actual. So, that was what we were anticipating on. And then that middle that second to right there is the 20 25% actual to budget. So um so what we had budgeted um for construction sales tax and we anticipated we actually um you see like 162% more that we received than we had anticipated um with that um uh and you can kind of see uh with the other ones that are highlighted there's building permits and zoning and subdivision and then down below the traffic impact fees, park impact fees. there's um you know there's more uh going on than we had anticipated um with construction. Um and so that's probably would explain um most of of what those increases are there um for there of why we ended higher than what we had uh had budgeted for. Um some other ones that I just want to point out as well. Um you do see that our transportation benefit um money as well that that was that that's continued as we've we anticipated having about 1.5 million and um we've been receiving a little bit more than that um actually about um so about 1.7 million in 2025 and then our investment interest um this is one that where we

actually uh received a little bit more than we had anticipated um but you do see that the or the budgeted amount was um 77% to 2024 actuals. Um and that actually uh and you do see that we did actually get less interest um than we did um from 2025 to 2024. And that's mainly due with interest rates uh coming down. All of our money is in uh is in the LGIP um which follows a lot of the Fed rates um very closely with the Fed rates. So as the fed rates go down, um that goes down. Um what we receive as well goes down. Um so uh yeah, right here is the screen is our revenue. Um just that just based off the major sources. Um that local sales tax does include so this is makes up 19% of the citywide revenues. Um this does include the construction sales tax um in there as well. uh because those are that's lumped together. Um our property taxes are second largest at 12%. Um and then investment interest is 5%. Um the total of our revenues and it has decreased 19% over the prior year. Um our real estate excise taxes or REITs decreased 8% in 2025. Um but our traffic and park impact fees increased 84 and 71% respectively. um with our building permits increased to 66%. Um and then we had the transportation uh benefit program increased 8%. Um and here just so you can kind of see as I know I've kind gone through here in the chart you have the uh the lines um or the I guess the the bars are the actual amounts um between the two different years 2024 and 2025.

And the lines up above is where is are those budgeted amounts for 2025 and 2026. Here we have our sales tax um and how that's broken out. As I said, you'll see construction uh sales taxes in there as well and highlighted are our four major um portions of our sales tax that we get. Uh, one thing to keep into consideration, construction, uh, sales tax is something that we consider as one-time um, money because um, because it it you can't consistently depend on construction. It eventually will go down at some point. um you only have so much construction that you can do um before uh that amount goes down as as opposed to the retail um retail amounts. You know, those are businesses within the city and those are going to be you're going to continue um you should expect uh more consistent uh um revenues for with those as well. So

reporting in progress

and here we have is going on the the expenditure side. Uh we have our the sorry we got the echo there. Um citywide expenditures by type. Um, and so as you see right here is that salaries, benefits, and overtime um is a significant portion um of our our operational expenses um at 33% um of our total citywide expenditures there. Um and that was a an increase of 6% over the prior year. Um but also ended at 88% of our budget. Um so some of the a lot of that is the cost savings uh from uh from open from open positions for that uh capital outlay made up 48% of the budget. Um but as you can see it it ended at 33% of all the expenditures. Um again that's just uh we um how we've budgeted um with the capital and all that you know and that doesn't take place um uh you know we it's not always uh we don't necessarily expect those I think if you remember at the council retreat how Aaron was talking about certain projects um we have those budgeted but um but it's not they don't always come to completion and um typically run over from year to year as well. So um and then uh and then services ended at 83% of our budget, an increase of 10% over the prior year. Um and then interfers out um that equal interfund transfers in on the revenue side. So those cancel each other out. Uh this right here is our general fund summary right here. Uh so on the top there is the actual is our the general fund uh 001 of our uh of where we are. U between the red and blue lines are the

expenses and the revenues. And then the lines below is where we uh or the bars is going to show you where um our balances have been um between throughout the year. Um and uh and matching to or comparing from year to year as well. Uh as uh and then down below there are our other uh general uh managerial funds that we have. Um, we have our uh our contingency fund. Um, our permit fund in the purple down below. Um, sorry, the contingency is the blue one up on top there. Uh, the pandemic recovery fund is that is the green one. And then we have the commercial rental fund there, the red on the bottom there. Uh so that's where we are with our and as you can see there is that we um is that we still our our general fund is um is is at about 4.8 million is what we're ending our balance at there. Uh here is kind of an overall picture uh between the budgets the budgeted revenues budget expenditures and what's been collected and what's been expended um as well and the percentages there. And then at the very end are the cash and investments at the very end there. Um in the gray there I highlighted some of those uh some of those items that I had uh pointed out. So you see like in our park mitigation revenues. Um we did anticipate to receive grant funding for the Frontier Heights in Cedarwood and a total of 3.6 million. Um those were not received in 2025. Um and so that explains the difference there. Um, as you can also see too in the revenues, um, they they're a lot less um, than what was budgeted, but then you also look on the expense side as well, and you see that the amount budgeted as well is um, is really low as well. So that just indicates there's projects that haven't

started um, haven't gotten fully underway um, for there as well. So you have your REIT 2 um, as well. So those revenues again um so we did not receive all our federal funding for the main streets in 2025. Um we will be receiving the rest of that grant revenue this year. I think we're uh coming to completion with that um if I remember recall correctly. Uh and then you have our facilities capital projects uh fund as well. Um we did and this one's a little bit different. we anticipated to uh uh purchase or a property um to sell um that has not um sold the uh had not sold yet in 2025. Um and there was also some grant funding as well that we had not received yet um but anticipate receiving in 2026. And then the storm and surface water um be and the capital um you know again those just had uh grant funding that we were that we had not yet received yet um and and that we've been starting to receive in 2026. Um so that's kind of some comments there on some of those bigger ones that highlight there what those differences are. And then right here is our debt service. Um and these are the different debts that we have as a city. Uh where we are at the end of the year near the over there the total balance as of year end. Um and you can also see where what our funding sources are and you can see the year of payoff. Um you can see within the next uh couple years there there will be a couple um couple of these that will be uh fully and this this year specifically one will be fully uh paid off and then a couple others coming coming up the road too to be paid off. So um and that's all that I have for you um for where we are in our

finances. Um, if you have any questions, any questions for Matthew?

Okay. All right. Great presentation. Great job. No one has any questions. [laughter] I don't know that's happened before. Thank you, Matthew. Appreciate your time. Moving on to our second discussion item. Gan is going to talk a little bit about the citizen financial task force.

Very much. It's a bit of a backstory. During the uh 2026 budget process, we had a lot of discussion about revenues and revenue sources and what to cut and what to fund and all of that. And one of the commitments that we all made together is to look into our finances this year and really dig deep, educate not only the council um but have a closer look at our expenditures, our service levels, everything that goes into that. So, uh, in working with Mayor Gaye, he had talked to, you know, other cities out there and Mount Lake Terrace had really done a really nice job of having a citizens advisory group put together, called it a task force. So, he uh asked me to look into that and then bring this information back to council for consideration as an option that we might want to implement here. So I took the liberty to uh do a bunch of phone calls and we actually uh met with the representative from uh Mount Lake Terrace and had the discussion with them and got the insight to the process that they went through and their process was a year-long process. Uh and that was because the consultants needed to do a deep dive right out of the gate to find out okay where is the baseline where is the city at financially. So uh that's where they started and uh through that process they actually developed a citizen advisory group towards the middle about 3/4 of the way through the process they developed this group started educating them providing them with all sorts of materials to bring them up to speed on the city finances. Um, all the while the consultant that they chose was working on updating their financial model and they produced at the end a long-term financial plan for the city. I went

ahead and called three different consultants FCS Burke and Tilly or Baker Tilly and had a conversation with them about our timeline. And because we're trying to prepare for our budget season, our timeline is pretty short. And each one of those consultants said that that is too short of a timeline. We need pretty much a year to be able to do something similar. That being said, everybody in the group uh in that group that I called agreed that a phase one would be needed, which is the deep dive into the city's finances. That would take around 3 months to complete that work. And at the end of that, the the uh company would produce basically a report of where the city finances are, some recommendations, but just basically a baseline for us to work from after that. And that again was 30 to $40,000 to complete that work. Um our last financial model was put together in 2018. And you just saw Matthew presents some of that. The graphs that you saw that comes from our financial model. We've been using it for a number of years. Uh I would recommend that that gets updated at some point. To get to that point, uh we would need to fund phase 2 and phase three to be able to actually have a financial model at the end. And you're talking about $100,000 120 all in if we went through that process. Um, but we also need to look at our storm water rates. Uh, we haven't done that in a number of years. We've talked about what does it look like to maintain private storm ponds, all of that stuff. And so, as we talked at staff level, if we did move forward on a phase one, it would be smart to

incorporate storm water rates in there as well as part of party research. Okay. The other thing that the financial model would do would be modernized. Uh, and right now I think Matthew's pretty much the only one that can operate the model we have. It's Excel. It's super complicated. And so maybe we'd get something a little more modern that other staff members could operate. Uh, but Matthew does it for us now. Does a great job. The consultant said uh each one of them stated that if we put a financial task force together of citizens, the goal would be not only to educate them to but to to have them as support systems out in the field, talking about the city, talking about the financial constraints we have, some of the uh service level issues that we have. you know, we're struggling to maintain service levels because of costs are going up. They would be our advocates. In order to get them to that point, we have to educate them and put the time into it because I mean, you are all learning right now about the city finances. It's quite complicated. There's a lot of moving parts. So we wouldn't want to rush that component because at the end you want to have allies because at some point in time we may or may not have to go out to the voters to ask for additional money if that's what is decided and they would be our advocates and champions to move initiatives like that forward. So that's something to keep in mind. Any questions there before I go into a recommendation? Yes. Um, so I guess my first question was I was a little surprised when I saw that we would be looking at $30 to $40,000 to update the financial model. I guess I'd always just assume we had that capability in house. We had a very talented finance team. So what I guess what skill set, what capability that's outside of our current, you know, our

our wheelhouse would we be getting for $30 to $40,000? So just so I'm clear, the financial model is an additional step. So phase one is just a deep dive. Basically they go through all our records cross examine if you will all of our reports and our financials we presented just like tonight. Make sure there's accuracies throughout. We believe there is because we get clean audits but these consultants specialize in that field.

Sorry I I yeah I misspoke there. Ultimately getting to that model though I same question I assume that we had that capability inhouse. So this extra money these consultants like what what are they doing? What is their skill set that we need to bring them in to do this work rather than having it done inhouse?

Yeah, great question. And we might have that talent inhouse. We don't have the bandwidth to do it. It is a heavy lift. If it's going to take a consulting group three months to do it, I mean it's just not some a task that we could take on. In addition, it's kind of like a peer review, right? We're doing it in house and so you want checks and balances, so it's wise to have an outside third party come in and review our work.

That makes sense. I I guess kind of back to my my surprise, I I would have assumed that updating the model and making sure it was, you know, sufficient for what we need would be an ongoing process. maybe not something where every so, you know, every roughly 10 years, 8 to 10 years, we say, "Oh, we got to redo this." Um, that makes me wonder, you know, is is the current model like are there accuracy questions? You know, is it reliable? And Matthew, I don't know if you're in a position to comment on this, but it it concerns me, I guess, that we're looking at such a large expenditure to get this to a point where we consider it up to date when that's that's what we're basing all of our financial decisions on as a council is this model. Yeah, I I would say that it's it's an Excelbased um document that we have and and we've had it for quite some time um that I know and so um the issue is that once you you start playing around in Excel with different models um they they are very um it can get susceptible to breaking. Um and I have been working on it trying to see how it can help streamline it. Um and not only that it's also very um it takes a lot of time to update it uh on our part as well as Jean had been um indicating you know just the bandwidth that that we have um and um it and with new features um in Excel and things like that it's um you know trying to get that um it would be um it we could update that and try to try to find that out as well. Um but it's but it would take a significant amount of time um through all the different uh worksheets and everything that we have um is what I would say. Um and I'd also Yeah. So it's it's something that's that's possible but it's the bandwidth uh for us to get there would take a long

time. Are are you still confident in our current model? Yes. Yeah, I'm still fairly confident. Um I think when we had this done prior it was Gina I don't know if you recall but it was I think that they kind of had um and uh they they kind of gave us some models that um that we've just kind of um you know we try to update as best we can. Um sometimes is and you know in our finance group our uh we are accountants by nature um not not finance uh in in there you know in fin there's there's a huge difference between that um so so we've um

so kind of understanding a lot of that that finance portion and I know it's you know we are the finance department it's um but kind of accountants by nature um it's kind of trying the predicting and things like that Um, sometimes it's nice to have somebody who's uh more knowledgeable um as well to help provide uh numbers um that will be more u more consistent and hopefully [clears throat] more real time than what we might provide. So then while I'm loathed to even bring this up uh hearing a potential six figure price tag for an updated model and hearing that maybe there's a skill set that we could benefit from having on our team, I don't know if it's worth looking at. Is that a capability we need to add to our staff in the long term going forward? So something to think about.

Yeah, we could certainly look at that. And this is much like uh if you think of your car, right? You got to change your oil, you got to make updates, you got to do software updates. 10 years ago was a long time ago for Excel. A lot of things have changed and so it's just smart business. It's it's no different than the auditors coming in and checking our work every year. And so they charge us $100,000 for the audit. Oh, and I'll I'll just add 10 years ago was a long time ago for the city of Lake Stevens. Like our city has gone through such dramatic change in a really relatively short period of time. Um I think that we're starting to experience um in our in our the way that the the finance finances look um that we're outgrowing Yeah.

what what's been what's worked in the past. Quick question and that that $40,000 to kind of take a look at and get ready. would it be an additional 120 on top of that to implement or no all in you're around 100 to 120 okay to do the model and and again I haven't received quotes but this is estimates from those three companies okay

the question on um how this is structured if I understand it correctly um and I am in favor of bringing a third party in to just kind of give us an idea of what is the right um level of expenditures to revenues ratio that we should shoot for what is our you know reserve percentage um that should be there considering that in the last seven years I think I'm looking at the 2019 budget which I realize it's it's really a long time ago we were we went from revenues at 29 million expenditures at 27 million so you have like a $2 million kind of difference in 26 six, we go to 51 revenue to 66 million expenditures. So you go to a $15 million delta, which is the same in 25. And you've presented today that the year balance from the budgeted to the actual was less. So that's hopeful to to learn. Uh and hopefully we'll be at that in 26 as well. Um, the one thing that I think um I'm having a little bit of of questions about is a citizen task force aspect. I think my preference would be that this would be a council budget committee that is looking into this versus going through the process of interviewing a panel of citizens, then teaching them, then getting a report back while we're trying to do a budget and looking at the five to six year forecast. Um, so I think that that's my only um kind of comment on that.

Okay. Can you provide clarification when you talk about the financial model uh council member Aria? What you said uh about um yeah reserve studies and things like that is not what I envisioned when you talk about a financial model. I'm I'm thinking you're looking at the Excel spreadsheets and how things are calculated and what percentages we look at for uh whatever accounting terms you want to use and not what you're talking about sounds to me more like how we budget and how we approach finances as opposed to accounting jargon. [clears throat] I mean that in the nicest way.

Yeah. My my I guess my understanding so I would appreciate the clarification. My understanding is that this group will come in, we'll look at our finances, will compare it to similar experiences or their past experience and make some recommendations and outreach materials to inform the citizen group or the council to make decisions based on that. Is that

correct? Okay. So they'll come in, do the deep dive, review all our numbers, see if there's accuracies or discrepancies, and as they move towards the model, they'll identify opportunities for more revenues or whatever they may want to recommend, right? They might recommend your reserves need to be higher or they need to be they could be lower or whatever uh may come out of that. But at the end, the end product that we want that we can use is the updated financial model along with all the other information they'll provide as we head that direction.

It sounds like, and I agree with Council President George, that this just doing this initial exercise may bring about a lot of really good insight, you know, and it may be there's an updated software program that we could purchase that would make it go quicker, faster, or not be such a burden on staff whether we ever get to the point of a sentences review. It sounds like it's a good idea just to do that uh based on the growth of our city which council President George mentioned earlier.

Following up on that, do you if all we're looking at initially is that um kind of taking a look at what we're doing and how we could be doing it more efficiently or differently. Um, is that still a 30 to $40,000 investment? If Okay, I just want

I think I think that's a smart idea because if we try to do it all at once and stand up an assistance task force, all the education has to come out of it. It's kind of like changing the engine while you're flying a plane, right? Um, it would be better if we got a financial model that was repeatable, that was [clears throat] sound, that was quick, that could be run even monthly if we needed to through software. then starting up a citizens panel makes sense because we're going to be feeding them good accurate information, not confusing them with we're trying to fix it so you can see it accurate. You know what I mean? And I do think it's a good idea not to take away the power of the council, but get recommendations from the city and hopefully create some of those ambassadors out in the city that are talking about the good things we're doing, not all the things they think are going wrong. I want to respond to um Council Member Aria's idea about a a committee, a council committee. And Ryan, feel free to chime in. This [laughter]

I figured um this was brought forth as an idea last year. Um and there was some pretty robust discussion about whether or not it made sense to have a a smaller budget committee within the council. Um there were pros and cons. there were uh council members at that time who had tried that before several years ago and had you know had brought their experiences forward. Ultimately last year we decided not to do that but I do think we have a new council, we have new staff. I think it's worth a discussion again and so I would like to suggest that we um bring that forward on a future agenda item as a um discussion item. I would agree.

Yeah. So, I'll just say um I I agree with Council Member Mariah and I think it's it's mainly while I appreciate the idea of ambassadors um you know, citizens out there. I think there are other ways to get feedback from the citizens for one, you know, I know we've used like Zen City in the past or I'm I'm not opposed to focus groups, things like that. Um, where where I think I have a bit of a sticking point is we've got a bunch of new council members. Council [clears throat] members who have been on the council for a couple years now could always use a refresher. If we're going to allocate any resources to budget, education, deep dives, I think for at least the next year, if not the next couple years, that's better spent on the council itself so we can make better decisions. And our decisions are what they are. If the community disagrees with them, then we are held to account. I'm I don't want to expend resources, you know, building myself personally some kind of shield from my responsibility. You know, if I make a bad budget call, then it's I'm it's in view of the public and I will be held to task.

And and I agree with um Council Member Donahghue. We've got four new council members. We're getting a new mayor. We just had another resignation within the city. Pretty big one. Um there's a huge learning curve I think with our city administration right now and um we're put in place to make those tough choices. Uh that was what I spoke to today is we've had to make some really tough choices and I think streamlining it so it's not an Excel sheet that we only have one or two people able to understand is probably a really good idea. Um, and we've updated other software in the city. So, I think that's definitely moving in the correct d direction. And President George, absolutely. We are I've lived in this city 25 years. We are a different city than we were in 2018. Um, so when it comes to a citizens task force,

[clears throat]

uh, you know, a couple of things. Um, number one, for the parks board, we had four people apply, right? there's not this huge outpouring from our citizens that have time to invest in this, let alone the qualifications that would be needed for a citizens board like this. Um, when it comes to the city council board, I remember that discussion in the workshop. Who has time to do one more board? Right? My evenings are pretty packed with council business. Um, so as we're talking about even putting something together within our council, who has that extra time to truly do that? Um, that was one of the things that came out of the workshop is I didn't see a lot of hands raised. I every I thought it was a good idea to take a closer look. That's always a good idea. Who has the time to do it? Um, so just a few things to consider there.

Thank you for their discussion.

Yeah, I I am not a fan of spending the money and talking to somebody else. I mean, we do audits. Our city has been audited multiple times. We say that we've got a strong financial um situation situation I we've got a good control of our audit and our money and where it's going. Uh we know that we've done that multiple years. I also mean this in nice ways possible. We pay our finance department a lot of people. We're going to hire now a new finance director. Why can that not be part of the qualifications? We want you to be bringing in skills that enable us to go in and build this model. Have we done an assessment already to say what tools are out there? We just redid our public works software. Is there similar software out there for city finance stuff? I just I don't see the need to spend $40,000 just to scope out what is the situation and then dive into something else. I think we are paying people a good amount of money. if it takes us a year or two to do that ourselves. It sounds like it's going to take a year for an a um a consultant to do that. Anyways, I think we should we should be able to do that ourselves. Maybe there's a software package we need to buy to facilitate that. We shouldn't Yeah, in my opinion, our software people should not be writing their own finance model in Python or Excel or anything else. Like there's real software out there. There's got to be something that we can do. I I I don't think we should go spend that money to go do that.

Thank you. Jean, do you need any direction or additional information?

Well, yeah, I guess uh to put it bluntly, yeah, I do. I I need some direction. Um happy to continue to work with the council and bring you updated numbers. As you read in your email this evening, we do have some staffing changes coming forward and so our bandwidth is going to be less than it is today and and we want to make sure we get bills paid and take care of the have to do and this is over and above it's a project. So if we were to move forward on it, uh I would recommend incorporating the storm water rates in there. [laughter] That is not included. I want to make sure I'm clear on this point that it's that's not included in the 30 or $40,000. That's only the deep dive. So to do a storm water rate study, that's going to be an additional amount, but that would be paid from storm water. The 30 and 40 we've cobbled together with budget savings in different spots to be able to do that phase one now. So if council chose to have staff work on that, we could do that portion and hire a consultant to get that going. I would recommend mid to late summer before we even start that process. Uh we just don't have the ability to do it with everything else we've got going on. And then we could move into 20 27 discussion whether or not it would be part of the proposal. Do we fund phases two and three to update the financial model? We could do that. I just need to have some direction and I'm happy to bring this back in a month after you've thought about it. That's totally fine by me. But right now it's a project on my list and I just need kind of some direction on what council wants to do.

Can I add um this is HR director Warrington. I will just add that um to uh council member Packard's point about the software. We have looked at ERP solutions in the last few months um which would include updating our financial software system to include budgeting packages and projections including HR software. and we had to put a pin in that project because we don't have um staff capacity to project manage a full ERP solution. It's a very big task and one of the um staffing requests we brought forward a couple weeks ago, the management analyst would help drive that project forward and so that could be a solution in the future. Um but just given our staffing levels in both the HR and finance department, we just don't have capacity right now to like look and explore for improved software at the moment. question.

Um what would be the end goal of this effort? Um is it to So we're going to work on the budget for next year kind of at the council level. Um I think our our goal is to have revenues and expenditures align or or be um sustainable over the foreseeable future. So 5 to 10 years so that we don't see a a potential dipping into the reserves or the the percentage res reserves. Is that the goal of the of of this effort? Is it to fix a potential structural deficit that other cities are seeing and that may result in an increase uh of revenue ask in terms of taxes from our citizens? Is that the goal? Is that what you're seeing that this will lead to at at the higher level?

I believe that's part of the goal. Part of the goal is to educate the new council on the budget process. Uh in addition, I believe at some point in time, we're going to have to go to the voters for additional money. Uh we've done the cuts that uh the council had talked about earlier this evening and there's not a lot more to cut. And so at some point with everything the cost going up, wages going up, cost of living every year, somewhere we need to come up with additional revenue. And if the council's comfortable moving that forward to a a vote at some point in time with the taxpayers, you got to have a pro and con committee. You you guys know how all that works. And so the question is, will we have advocates out there for the pro committee? I don't know the answer to that. But one vehicle which is was used by Mount Lake Terrace was to put a citizens task force together to have those advocates and say, you know what, community, if you want these nice parks and stuff, the money's not there, you know, or you want nice streets or whatever it might be. Um that is one of the outcomes if you were to go with a full citizen um uh task force. uh [clears throat] update in the financial model, those two things what what you had mentioned and you know long-term forecasting as well.

I'm just noticing the time at 7:59. Um we will need a motion to extend the meeting if we want to continue this conversation and um do council business. I'll make a motion to extend the meeting 15 minutes. No, no longer than 15 minutes. We'll start with 15 minutes. Okay. Second. Uh motion a second to extend to 8:15. Any discussion? All the I would just say I mean Jean I don't know if you have enough direction. I don't know if anyone has any burning council business. I personally am your suggestion to give us some time to think about it and then come back maybe submit followup by email. I'm comfortable with that but I don't know if anyone

I just didn't know if someone was going to make a motion and I wanted to give a little space. Make the motion. I I am not going to make one. I want to give a little bit of space. The other thing that isn't on the agenda is to hear about upcoming agenda items. We would also have to forego that if we were to end the meeting now. Okay. My motion still stands. We have a motion to extend to 8:15 and a second. Any further discussion? All those in favor, please say I. I. I. Any opposed? Okay. Thank you. 8:15 will be our goal to end this meeting. I I propose that I bring this back in a in a month or two. Let things settle down a bit. We'll know where we're at staffing wise at that point in time.

Will we? [laughter] I think um I'll make a comment that before we raise revenues, you mentioned we cut as much as we could. I don't think the new council is feeling that way right now or all of us are comfortable with saying all of the potential cuts um so that we can go back to the residents and say we have cut everything we can. So I think [clears throat] that's our task this year in the 27 budget um before we ask people for more revenue. Great point. Thank you. Jean, would you be able to bring back um some sort of maybe a sample of what these models might look like? [laughter]

I can. We've have a ton of information from Mount Like Terrace that they sent over and I can basics I think is Yeah, I will. Good. I'll work with Caitlyn and we'll send some information out because we've got a bunch. Awesome. Thank you. I'm just doing maybe a presentation so we have a little better idea of what we're talking about. Okay. Well, to that point, Barb sent out a a budget model light copy last year during our discussions, and it's a beast of an Excel sheet, even in that format. So, be careful what you're asking for. This is true. Just the cliff notes. That's all we want. Yellow book. You guys have all seen it. You went through college. [clears throat] Excellent. Thank you. Still use books. Yep. [laughter and gasps]

Uh, moving on to council business. Uh, let's start at the end with Councilman Packard and then we'll move our way this way. Nothing from me today on council business.

Thank you, Councilwoman Edwards. All right, so just really quick, um, I was able to attend the Easter egg stuffing on Saturday for the Easter event. That was so much fun. We had so many um, high school volunteers. It was so awesome. There was families that came with their kids, um, adults, people even from other cities. Um, it was it was pretty cool. Um, and then yesterday, uh, along with council member Aria, um, I attended the elementary 8 groundbreaking ceremony for the new elementary school next to Stevens Creek. Um, and so that was really exciting to get to meet the engineers and and see all of that, um, break ground. So, um, and then the only other thing I wanted to say is that I really appreciate, um, everybody working together to come to a solution for Aquafest. you know, like I said earlier that it really is an important event for our city. Um, and I think that we should just move forward being really careful and um, make sure that we know what we're doing. So, thank you.

Thank you, Councilwoman Shipman.

Um, I attended the school board meeting. Uh, this last meeting was at Stevens Creek Elementary and their focus was on special services. Um, otherwise known as special needs, special ed, that type of thing. And I was very indepth from preschool all the way through the high school and very impressive program. Um it was very heartfelt. Um I literally felt driven to make a comment about the the presentation they had. We have some pretty amazing services available to our families and to our students. Um I was unable to make the ground be couldn't quite get out of my office in time. I really wanted to be there yesterday um for the groundbreaking of elementary school 8. Um I was able to make the um the public meeting here about the revamping of Cove Park um boat launch of North Cove Park. And so we had quite a few people show up. There was a lot of, you know, good information shared and boards where people could put stickers on their likes and didn't likes and post-it for ideas. So, I always welcome that type of feedback from um the citizens and I appreciate our departments coming together to provide that.

Great. Thank you, Councilman Donghue. Yeah. Uh nothing for me other than just a reminder that I will be unable to attend next week's meeting. So, uh all of you enjoy Councilman Mayus.

Um I intended the marina. I thought that was really good. A lot of people had some really good ideas. because it was um kind of comical how they were moving lines around on all the different story boards in pictures of the overhead and some of them were really funny like one of the guys says can you tell me how I'm going to back up my boat not hit the boat right here on one of the drawings so it was really funny to hear that since um also spent uh the week I visited uh three principles at each level uh elementary middle and high school kind of got their feedback from an educator who's actually in it versus on a board staying it and managing it so it was very eye opening to get some feedback from them on things they'd like to see from council which will come up in a more pertinent date later. Uh and then also spent some more time downtown talking to some of the business owners specifically around Aquafest and its impact. You know I I asked for numbers on it uh an economic impact for you know last week when we talked uh and I wasn't I wasn't sure if we're going to get it was a good economic impact or a bad economic impact. I think hearing from Jay's market tonight that they're considering closing down was concerning uh during Aquafest and some of the challenges. So, you know, while I love that they came up with a number that was based on other festivals and a national number that generated 2.2, that's all kind of swag to me until we get actual numbers. So, that's kind of led me to make the discussion point of let's make this a budget item next year on our on our balance sheet to make sure we're more concise and not borrowing from different pots of money in the city that contain the overtime that we need and all that good stuff. So, it was eye opening. I was really surprised a lot of the businesses downtown that aren't serving food or beverages are kind of looking to close during the rest which is just concerning. So, it

Thank you, Councilwoman. Um just a couple of things. Um last Friday, Director Halverson um and other city staff gave me a tour of the public works facilities and parks facilities and I was very impressed with the condition of of how we keep our facilities. They were uh not not glamorous but very well uh kept. They were just the right size and um equipment was pristine. So, I was just very impressed with how we keep um the condition we keep our facilities and our equipment in. So, kudos on that and I appreciate the time. Um congratulations to the school district on the groundbreaking yesterday. That was um that's awesome to see. We have a great school district. I think everybody agrees with that. Um and kind of on a announcement note, um in my day job, um I I do transit. So part of that is sitting on the transportation operators committee at Puget Sound Regional Council and they uh Puget Sound Regional Council is a great organization. They also are the ones that administer all the federal grants that transit agencies um receive and distribute it. Um so it's it's it's really a very powerful organization. Uh but they also do regional transportation planning. So, for the summer, they do have a summer planning academy available for high school students. Um, to learn more about the program, um, you can go to Puget, uh, Sound Regional Council's website. Um, applications are due May 18th. So, um, they also have a a $500 scholarship opportunity. So, I would really encourage I saw a lot of high school students being involved with council and it would be really cool if they uh check out this opportunity and start early. Thanks.

Great. Thank you so much. Um I will just say that I've spent the last week learning quite a bit about what it means to be mayor prom, which is short for mayor prompor, which is Latin for for the time being. So, for the time being, um uh I don't officially take that role for another week and a half or so, but um I just I I want to let council know that I I'm still also a council member and will be, and so I look forward to leading the seven of us through this uncharted territory that we're about to enter. Um I think that it's really a great opportunity for our city and it's um the gravity of the decision that we have to make is is quite big. So um I look forward to working together through this process. Um I'm excited. I think it's a really exciting opportunity that not a lot of councils get. And so um there's still a lot to work out. There's a lot of process to kind of figure out. I think over the next couple of weeks um it'll be uh learning by fire hose what that looks like and and how we're going to do this and I look forward to those discussions. I think it's really important during this time too that we um keep in mind that this is a real upheaval for our city staff. Um and [clears throat] so anything we can do to lend some extra support, some extra stability, um to just to help all help remember that all of us are a team working together um to move through this I think is going to be really important. It's going to be busy. We all still have work to do. We all still have our council business to do. The city still has their city business to do. And in the meantime, we need to go through this process and and help determine who the next leader of the city will be. So, I look forward to diving in. Um, I thank you in advance for your support and confidence in me and us. And I think

we'll get through it. I think it'll be great. Thanks for taking it on, Edgie. Yeah. Um, just want to remind people there's a form at your table. Please fill that out or ask Caitlyn if you have any questions. And then I'm also going to ask if we can get just a little sneak peek at what our agenda might look like in the next week or two. And while I'm pulling that up, Council Member Aria, if you want to leave me that flyer, maybe there might be something we can do to share it on our social media if it's through PSRC. I also, while you're pulling that up, I also will not be here next Tuesday.

Okay. So, I'll make this quick. Um, so sadly, uh, Mayor Brett Gayy's last meeting will be next week on the 7th. Um, I say sadly because I'm going to miss him terribly. Uh, anyway, we're going to, uh, do a thank you to him at the beginning of the meeting. um give him a nice plaque and then we'll break for cake um and refreshment. So public is welcome to come down for that. Um and then we'll go into our workshop which will be the pros plan presentation. Um I think we've got a consultant here and that's going to be a little more lengthy of an item. Um as council president alluded to uh we may want to do a review with you guys on the council procedures um as far as the role of the mayor prom and if there's anything we need to address in our council procedures we'll do that. So we're meeting with Greg tomorrow to kind of go through that.

So can you clarify? So that's again ro l o r o l e ro is what you're talking about. Yeah. No thanks Nathan. Yep. Thank you. And then we will we will also discuss the process by which we will appoint. That'll come up on the 14th I think. Um but yeah give us a chance to kind of talk with Greg tomorrow. We're going to lay this out. But sorry I see it on the 14th. Yeah, I think the more immediate is sort of talking about the council, the mayor prom's role, making sure we've got that all covered. And then on the 14th, we'll talk about a timeline uh for the vacancy. Timeline and process. And process, correct? Thank you. Yes.

Um so that's the seventh meeting. Oh, an executive session on uh potential litigation, but there's no action. Again, always uh fluid uh spreadsheet. This could change. Um I say that every time. All right. And then April 14th, uh, looking for a pros plan approval. Um, Matthew's going to be bringing forth a resolution to authorize us to participate in these opioid settlements without having to bring them individually. You'll hear more about that. Uh, community development has a couple city department updates on their first quarter. Um, and also the campus update. Uh, we've been working quite a bit on the council Facebook conversation. I pretty sure after today's meeting, we'll be ready to come back and talk about that. Uh the chief's got a cannabis ordinance to bring forward. Uh Department of Emergency Management ILA on consent. Um again, we'll get we'll dive into the VA the mayor vacancy process and timeline and also tenative agreement for with uh the row club on the 14th. So going to have couple busy meetings here coming up. Um I'll just go out one more on um workshop for the 21st. We'll have the annual police department awards, uh, critical area ordinance update, traffic impact fee discussion. Um, one thing that was noted today, thank you, uh, council member Shipman, was talk about those summer break dates for you guys so you can can plan on our, uh, council meeting recess. I just need to check in on Aqua Fest and also I believe Farmers Market might be I don't want to say anything. I don't turn might be using the mill. So, I just want to make sure I've got all that solidified and we'll um, come back to you with that. Um, we're going to try to bring the org chart staffing requests back to you as a followup sometime in April. I put it here on the 21st as a tenative and then the RFP on Cavalere. Again, just planning purposes.

Just like to reiterate my desire not seeing it on the list for an ebike ordinance discussion some point. So, yes. Okay. I'm sure it's in the parking lot somewhere. You do have to you it seen it in the parking lot. Yes. [laughter] And I know Chief has mentioned it several times, so I mean I know it's on the radar, but yeah, I just don't have a date plugged in yet, but I will. So, thank you, Clen. Yeah, appreciate it. Motion to adjurnn. Move to adjourn. Second. Motion a second. All those in favor? I

I thank you. Have a good night, everyone. journalist inspiration.