City Commission - Regular Meeting

Good even Hey, I got it. Can use it. Uh, good evening. This is uh welcome April 28th, 2026 meeting of the city commission. Will you please uh Jared, will you take the roll call, please? Mayor Adam here. Commissioner Mcola, yes. Commissioner Fox here. Commissioner Morrison here. Commissioner von Lenel here. We have a quorum.

Thank you. Um will you please rise and join me in the pledge of allegiance? I pledge allegiance 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. Thank you all. Um, this is a work session. We will go pretty quickly into this, but I wanted to Oh, is Director Dwit here? Is that

all right, we'll come back. [laughter] Um, I just wanted to acknowledge that Randy um has been voted the government engineer of the year from the Kansas uh professional engineers Tri Valley chapter. Congratulations. [applause] I I very much appreciate the professionalism of all of our staff and I'm very happy that when we are notified about this kind of uh recognition. It's it speaks well to our entire team to have th those that acknowledged. So congratulations Randy. You can go back out if you want. Uh we just have one item on our agenda tonight although I suspect it will be a rather uh interesting discussion. Uh this we will uh have a presentation on the endofear financials for 2025 and discuss discussing our bond and interest fund as we as preparation for moving into the budget season. So

yeah, and also just to note this is our first work session where we've adopted our new governing body policy where we do not have to take action um to allow public comment rather uh public comment will be um the rule instead of the exception when we do um our work sessions moving forward. But uh good evening mayor, city commission. uh thank you for the opportunity to um come forward before you this evening and um really kick off our 2027 budget development uh season. So what we'll do this evening is uh go over where we ended the year in 2025. So where our revenue collection came in, where our expenditures came in, and just let you know um how we wrapped up uh 2025. We don't have those audited numbers, but we're pretty close um to where where we ended in 2025. And then um the other important thing before we really start talking about uh where we head for um budgets in 2027 is going to be um talking about uh that debt obligation that we have. So this evening [clears throat] as we are you know kind of talking through these numbers the one thing I want uh commission to to understand is we do have a debt challenge in front of us. Um we know that we have um some uh general obligation bonds that we have issued. Uh and of course uh we have to make our debt payments as an organization. Uh there have been policy decisions that were made by previous commissions um that uh where we issued debt to pay for certain projects and then there were um that the community wanted or needed and the commission felt was in the best interest to issue debt to make those projects happen. Um we also there were policy decisions that were made to move um a revenue source that was um dedicated to pay for the debt on those projects towards um our operating expenses to pay for things like um our um public safety um that we have in our

community, parks and recreation um and other uh public works um those sorts of things. So those decisions were made by commissions and understanding that they made um the decision that they thought was in the best interest of the community with the information that they had at the time. So as we are moving forward with these discussions um just remembering that uh wrapping our arms around this topic and getting a good understanding of of where we're at um helps us know where we need to go. Of course, um at the end of the meeting, we will talk through what some of those solutions are, but we'll have plenty of opportunities to talk through strategies um to put our 2027 uh budget together, but really wanting an opportunity for the commission to fully understand uh where we are with our um bonded interest fund and where we sit with our city debt. Uh I think there's an opportunity for us to have a good conversation understanding that streets are important to this commission. Um and also um understanding that we have an opportunity for a sales tax renewal um in November of 2026. And so as we have this conversation, just keeping in mind that those are strategies and topics and things that we want to achieve um things that we talked about in our retreat. So uh the other thing I did want to share though as we were um heading into this meeting, we did uh get some good news um from Moody's rating agency. Uh you all know that we had the rating agency came to Manhattan um had a visit uh we toured we talked through a lot of the projects that we have going on and um they issued our rating today and we maintained our A1 rating and we are um stable. So um that's a really good uh note that came from Moody's today and um just you know wanted to share that just a quick opportunity to kind of kick off and frame this conversation um today. Uh but without further ado, I want to introduce um Bid Hart who is with Baker Tilly. Uh

so we hired uh Baker Tilly to help us um put together our our budget and to serve as a consultant for us. And so he is um I will let him he you he introduced you all um at the retreat. But um we are very thankful for Baker Tilly and um the services and the um um that they have provided us in their um wisdom as we are heading into um these conversation. He has really served as a sounding board for Reena, Jason, and I um as we um have these conversations. So, uh Ben, thank you. Thank you. And hopefully most of you remember who I am. Uh I spent 33 years in government. Uh half of that time has been in Reena seat at two different organizations opposite end of the spectrum. One with no money and one with too much money. uh and have spent the last 15 years, 15 to 18 years working with smaller governments both in bond uh bond capacity, municipal advisory capacity along with uh along with outsourced finance services. Uh to my wife Shagrin, she says when you leave as a finance director, you'll never have to go to a council meeting again. Right. I go to three a week now. That was nine years ago. So, she's a saint in letting me do some of this stuff because I really like what I do. Uh, working with your staff for the last month, month and a half has been fantastic. Uh, and I've had the privilege of working on both uh the bond issue that's coming up along with doing some analysis on on the numbers here. Uh, anytime I've asked for information, I've usually got it within five minutes from Reena. If I need Jason or Danielle, uh, they're on top of it. So, it's been an interesting it's been an interesting two months. Uh two and a two right about two months. Uh but it'll be an interesting summer as we move

forward. Obviously, um we talked a little bit at the retreat about uh the budgets you guys uh work with. You've got two buckets, right? You've got the operating budget, you got the capital budget. And capital usually is tied to your debt service fund. Cash as well, but your debt service fund as well. Anytime you have a have an ability to look out into the future to make changes now that will make changes into the future that's not critical situation, you're in a good position. And you've got really good news with both the operating budget and that debt debt budget. And I'll I'll kind of I'll kind of show you what at least from my perspective what that looks like. And there's some there's some strength behind that negative to stable outlook. When we talked to Moody's at the time, they said, "It's probably going to be next year before you ever get considered for a stable. Moody's doesn't change things on the on the drop of a hat at all." And the mayor was luckily she was s able to sit in that conversation. Uh, and a lot of it was because of how you ended 2025. Uh, even from a pre- audit standpoint and then what 26's budget looks like. That was one of the things that uh impacted me the most when I was looking at your financials and started really doing a deep dive in some of this. The uh so what we I'd like to do today is really talk about the very first step in the budget process 2025 year end review. Now what we're not going to do is turn you in accountants tonight. Obviously what I want to do is touch on some of the bigger funds uh tonight. some of the ones you'll spend a lot more time about working with this summer and where we end at 2020 25 what 26 might look like. But in order to do that, you kind of know need to know, at least the public does, what your major citywide revenue sources look like. And this is citywide from all funds. It doesn't matter what fund it goes into.

75% of your resources come from these funds right here. sales tax, property tax, franchise fee, compensating use tax was a real a real winner. Back in the COVID days when people didn't leave their house, the youth tax took off because they ordered things, right? And my daughter's now in Manhattan ordered things tonight. So, [clears throat] she's feeding into that compensating use tax. At least I am. Uh the uh special liquor tax, transient guest tax, utility charges obviously is a big one. We'll have a a workshop devoted to utilities as well. I know our staff's working with um working with Randy on utilities as well just to make sure we've got everything uh that's needed in there. The the first slide we've got up here is the revenue sources, the ones that I just mentioned, the major revenue sources. There's not a whole lot of difference except for maybe the property tax at the very top. Um Danielle mentioned the levy shift that you guys are aware of in 24 for the 25 budget. You're going to see your property tax went from 4 million up to 8 million for 2025. The the Thank you. Uh so there was three mills that came out of the debt service fund and we'll talk about that during the debt service that went into the general fund. Uh the other thing that that I noticed on your sales tax sales tax doesn't move a whole lot. That's why we keep that at a forecast at least at 1% or lower moving forward to keep that conservative. The very last line that you've got in there is transfers and they've they've bond been up and down uh over the years and mostly due to the uh ARPA the American Recovery Act uh revenues that came in

was transferred into the general fund in 2022 I think around 5 million and then uh again I may be saying that wrong. 22 yeah 22 was $5 million and then the next peak that we see is the 3.8 8 million that came into the general fund. So the the 2025 is relatively stable other than uh some of the uh shifts that was made on purpose and those are the levers obviously you as as commissioners can change or can can move and as I go through this if you've got questions please let me know and I'll stop. Yeah. Uh just a question. Whoever put this together, this is directed to them. That col uh column for 2023, right?

Uh doesn't one of those numbers doesn't seem to be correct because that column totals up to 32,480. But in another portion, another page here, it shows revenues 34,143. And that 34,143 makes uh all the cash balances work out right. Okay. Okay. I appreciate you 32480 doesn't work for ending cash balances. Okay. I appreciate you pointing it out. We'll make sure make have somebody check that out. Great. Before that gets anywhere. We'll make sure to change that.

I appreciate that. On the expenditure side, uh, one of the things to note here is the movement within most all of the funds from 2024 down to 25 actuals. We saw a fairly sizable drop in the number of the funds. Um, and I think that was on purpose obviously is you have to balance your budget, right? Uh, again last summer when you debated the 2026 budget, same thing happened. you come in at it from a conservative standpoint, uh either cutting funds or really holding the line on on uh u what you've got as expenses and budget rolling back. Uh these are two of the positives that we are pointing out to the rating agency is the [snorts] fact that that staff not just the city not just the city administrator's office but also the staff the executive staff have an ability to get their hands around some of these numbers uh and and keep him in keep him in con in check. Uh you see animal shelter there that went from 500,000 down to zero. Obviously, that was the move from the personnel going into police and then the contract for it going up into into general or down into general services. Uh this shows this does show the budget uh 2026 budget for expenses and that's just what this is. We didn't forecast or change this. This is just the budget for that for those numbers. Really, it's too early in the year to be able to pro prognosticate about what that budget would look like. Any [clears throat] questions with on the expenditures?

What are municipal services that just started in 2020? Sorry, thank you. What are municipal services at the very bottom that just started in 2023? [snorts] Commissioner McCulla, that is for the joint maintenance facility. Okay. Thank you. Uh and to be clear, the outside services, that's social service agencies.

Yes, sir. That's right. That's right. When we look at cash balances, [clears throat] uh, uh, this tells us a story as well. The one on the top, the graph on the top is the general fund. The orange line shows you the targeted cash balance. You can see from 2017 to 2022, the cash balance itself was well under that target. uh when we get into 23 through 26 uh and again the rating agencies were looking at 25 and 26 and and trying to make a trend out of it which really if you look at 23 four five and six it makes a trend that your cash balances are are above your target. Uh we fully expens expect 2026 I say that tornadoes this last week but uh we fully expect that 26 to land above your target um in the cash balances category when you look at uh and this is I'm going to look at the historical bond and interest uh fund cash here just to set up our presentation here in a minute uh from 2017 to 22 and this is the graph I'm referring to on the bottom uh the target for that bond and interest cash balance is in the green line. The blue line is the current cash balance as it moved from 2022 to 2026 all the way from 2017 really that full 10-year movement. And you can see from 2017 to 2022, it's relatively low. It's a really tight against that target uh all the way up to 22. Obviously, certain moves were made for 203 and and forward knowing that there was going to be a a plethora of projects coming down the line which we'll touch on that here in a minute as well. I keep saying that broken record but I just wanted to point that out. The cash balance here looks really healthy

and it is for that matter uh for the debt service fund. So that gap is fairly large between current cash balance and your target commissioners just so um I know not all of you were on the commission back in 2023. And so what that was was the approval of the economic development sales tax where 70% of that is dedicated to paying off um debt for North Campus Corridor and Aggieville. 20% goes for jobs uh for us to partner with the chamber and then that 10% goes to the workforce um workforce housing sales tax. So that's what that change in 2023 was.

Thank you. Uh this gets into the next few slides get into the actual cash balances and some of the movement within the revenues and expenses. Uh the the graph below is in each each case is going to be the ending cash balance and how it moved over that same time period uh from 2021 to the 2026 forecasted. In this case, you can see I'm going to point you to the expense line uh in that table. 2021 went from 29 million into the 2026 forecasted at 37 million. Uh obviously as as needs grow, so does expenses. But the one thing to note here is 2023 had $30 million, $39 million in the next two next three years are expected to be underneath that amount. Um and obviously you know 22 uh when you look at the revenues at 39 million there was amounts come in in the transfers for that ARPA funds. Uh 24 had the same thing. Uh in this case ending cash balance for the 2025 and 2026 is around 35% of expenses. Uh so the public usually ask if not commissioners what's an adequate amount right and one calculation doesn't fit everybody but what we are in the what we look at is anything from uh risk that the city has uh all the way to the the rating agencies and what they measure you based on. One of the reasons that that increase that negative to a stable happened was because of the the two years especially 2025 where you're adding around a million dollars to that fund balance uh in in 25 26 is a balanced budget. One of the comments they made within that uh rating

analysis said that that budget is balanced. So you can see how it was balanced uh in this case numerically uh with the surplus that's forecasted for the for the 2026 year. What we gave the an analyst uh was the budget itself just noting that that that it was a balanced budget as we move forward. And no real shock there and and and and that was that was good news for him. That also is a deciding factor. One of the dec well yeah the deciding factor in moving for us from negative to the positive or to the stable outlook. And that matters because of a because when you do borrow funds it matters because the the underwriters the people that the firms that do bid on your bonds they'll look for that kind of rating. Sometimes they won't even look at your financials. They'll just look at that rating title to see what it looks like. And there's raers, there's analysts out there and underwriters that only want Kansas debt. Uh, and more than likely they graduated from K State. They want Manhattan bonds because that's where they they live. They grew up there. Uh, the same thing with some of the other other university towns here here in Kansas.

Larry, a question. Can you remind me how the target cash balance is figured? I know it's a percentage. Yeah. So right now the million a really good question. I want to touch on that obviously or talk about that a little bit with the debt as well.

But the the target fund balance here is not a set target for you guys. There's not a policy that you have which I think needs to change but there's not an actual written policy on what that percentage is. Anywhere from a 15% minimum to a 25% target would be a healthy fund balance. Um, so what we're looking at, at least what I was looking at was a 35% fund balance. 35% of expenses is what I was looking at, um, is is what that what I was calculating that off of. So that's the general fund balance. It's positive news for both 25 and 26. As we move into it, we look at bond and interest. Um you can see back in 2021 we were operating around 16.7 million. This is where debt the debt payments are made of bond and interest payments are made out of. These are all long-term bond and interest payments. Um the 2021 was around 16 million 16.7 million uh and it continues to grow to 2025 actuals at 27 million. Uh in this case, the fund balance or the cash balance is fairly high. Like we mentioned before, uh your fund balance is is has been escalating here. knowing that there's projects coming down the down the pipe.

Would it been helpful to have a another line on your graph that says what it the corresponding debt is that we're worrying about cash balance because in n in 2021 I have no idea what the city quote debt was nor do I know in 2026. Yeah. And let me get to the debt presentation and you it might answer that question. If it doesn't then we can get that to you. Uh qu on expenditure. I mean I'm assuming expenditure is both principal and interest. It is right combined principal and interest.

That's right. We look at the water fund uh water cash balances is strong. Uh when we look at water cash balances, we're usually talking days of operating cash instead of percentages. Uh in this case it's just over 200 days operating cash uh within the water fund itself at 12.1 million which is fairly strong. It stays strong all the way through those years 21 through 26 forecasted as well. When we get ready to do the 27 budget obviously that's going to be one of the men benchmarks. The the measures we have is that cash balance of what we predict it will be or what changes uh into that 2027 budget. So that's the water B water fund. We look at wastewater, it's identical. It's the same thing. The over 300 obviously over the cash balance here in 2026 is over uh expenses. A lot of times that cash balance in utilities are being reserved for projects. Obviously some of those projects are fairly sizable projects. When you do it, when you have a bearing or a diesel generator that cost cost anywhere from 800,000 to a million5, those are not small pieces of equipment. Uh to be able to have that cash accumulate for those future uses is going to be important. Any questions on water and wastewater?

Do do cities normally separate them or they Yeah. So this is pretty this is a typical way

typical. Yeah. And they do that for rate structure purposes. When you pay your rates to water, you know what you're paying. At least as a citizen, you'll know what your rates are versus when you pay for your wastewater. You can see them separated and used in the financials. Uh I think we of all the clients, we've got one that combines them and they're getting ready to separate them. Uh storm water's the same way. A lot of a lot of cities will tuck that into wastewater or water. In this case, applaud you guys for pulling us out so you can actually see that storm water. Same thing here. Your fund balance here, your cash balance here on 2026 is really strong. Um, but it's the same thing. You've got storm water projects. They they tend not to be small and and any kind of cash you can put toward them is going to be a positive uh positive movement. So from the really from your major operating funds, which that's what those were, you've got good news within 2025. 26 looks really good based on your budget and how you're moving forward. So we've got a good baseline to start from when we really dive into the 2027 budget, which will be soon. Uh the departments have already been neck deep into numbers. Uh so they're accumulating a lot of what they've got to give us right now. Uh, so those are the funds by themselves. I want to divert your attention back to the citywide revenues. This is citywide as a total, not just one, not just one fund. So all property taxes throughout the city. You can see 42 million at the highlighted very far right hand column 2026 budget. Uh and what we did here is just break that out amongst the actual levied funds, the fund, the actual fund, the accounts that do have those uh levies uh within them. So you can actually see what some of the

larger ones are. Obviously, of all people you guys know, the size is really it comes down to the uh Bradley County Police Department being the number one uh levied fund that you've got to deal with on a year in a yearout basis. Uh the general fund obviously follows up behind that, but it's a long way down to get to that $9 million. Uh and then you can see the rest of them. I don't have to read them to you. Uh the mill levy's off to the right uh of each one of those just to show you what the the uh mill effort in each one of those funds look like. Uh utility fees is going to be the next one. When you look at this is around I believe 74 other except for other sources. If you take all of the sources out, all the rest of them add up to just under 75% of your total revenue coming in into the city, including transfers. So, this is a majority of your revenue. We typically try to watch these every month. If there's any kind of uh large swings in any one of these, then that's an indicator that says management really needs to take a look at it and adjust. Otherwise, if revenues go up or we've got a windfall of some reason for some reason and we determine that beet one time, then then you know nine times out of 10 that's going to go to capital or some type of one-time source. Uh but obviously, you know, this utility fees are going to be the highest one of the highest sources we've got. And you can see 26 billion between the 1.95 5% sales tax uh and then those transfers of 18.3 million. Um question that far right column I I I guess I'm a little skeptical of some of those numbers. The property tax 42,675,

right? [clears throat] If you multiply the mill levy 54506 times the assessed valuation you come up with 40 million790. Yeah. Don't forget property tax. Don't forget there's other property taxes that tag along with your ad valorum. You got motor vehicle taxes. You got personal property tax that go with that. So those will be but if you look at this column down at the bottom here that totals 42675 and that includes that tiff 1.9 million right why that's included in all those other numbers that have mill levies associated with them I don't know it just

it's confusing no I understand adding that line item yeah I understand that makes sense and the utility fees sure if you add up all the the revenue water wastewater I came up with 38,605. Okay. And you show 37,195. Okay. Well, obviously we'll take a look at that as well. A little skeptical of that. Okay. And and all these other numbers, I mean, they're all down from previous years. Sales tax down. Yep. And of course, keep in mind this is the budget or revenue numbers. We didn't have the we didn't have the luxury of having 2025 actuals when that budget was set,

right? And that's one of the problems with the Kansas budget and we've I've always dealt with every year is we're basing the 26 budget on April numbers on April prediction for the end of the year. So those numbers are naturally if they were high or at least higher than what your 25 actual is, I'd be a little worried. and and at the risk of not hitting those numbers for 2026 budget, but I'd expect them to be a little lower just because of the conservative nature of forecasting and the timing that the state makes you do this. Sure. Do we get any return on intangible taxes? Any return on intangible?

Any of it come to local or is it all go to your intangibles to the state? Uh, for instance, like interest. I mean, I have to file this thing called intangible taxes every year. Oh, I think that's all state, is it? It's all state. That's none of that comes to us. Yeah. What? If you pay it. If you pay it. That's the thing. A lot of people don't pay it, but [laughter] I pay it. Yeah. No, that that all stays at the state level. Okay. Yeah. Thank you for that. Could be. Jim, put your microphone up.

No, just if you want to speak, just use your microphone.

Go ahead. Uh, so this is 167 million uh in the revenue sources. On the next uh slide, it shows that same 167 million just dissected a little bit differently. Um this is this is actually broken down into the major funds or categories of those funds. Uh you can see the general funds at 38.4 million. Special revenue is a a mixture of a whole bunch of different uses, different funds themselves around 66 million. That's the majority of those funds themselves or the uh the revenues coming in there. Uh and then debt services broken out. You can see what that looks like with the utilities right behind it to 38.6 Six internal services funds are funds that actually serve other departments. Uh this is employee benefits fund fleet for instance is used across the board. Um are part of that part of that 4.8 million in revenue. So those are revenues that come from other other departments paying into that internal services.

Um quick question on on the debt service. Sure. Yeah. going from on 2025 actual going from 27 million to 19 million. 19. Yeah. And again, that was that 19 million is your budget. What we're working with is a number higher than that. Obviously, uh moving into 2020 2026. We're really looking at anywhere from 22 to 24 million that's going to be going into that fund based on debt that you've got pushed out long term that being turned in longterm this year. I feel like our debt payment should be more stable than that or I'm I'm trying to figure out. We'll get to that. Okay.

Hold that thought. Seriously, hold that thought. So, back on special revenue, you say it it's a mixture of a whole lot of different things. It's a mixture of a bunch of different things. Special assessment payments. Uh, no, that goes into the debt service fund. Let me get to this and I can tell you what those are. So, special sales taxes. Yep. Special sales taxes part of that.

Uh, a big part of that big part of that uh 66 million again is the Riley County Police Department makes up at least a third of that number, that 66. So the 26 budget, I'm sorry, the 25 budget in this case for Riley County was $23 million. And then there's there's probably 20 other funds that actually make up the rest of that number. Uh sales tax fund is one of them. We look at recreation and trails fund, libraries, part of those. Economic development sales tax is part of those. So there's a number of those. And if the public wants any kind of identifier, your budget book does a good job actually breaking those out and showing exactly what those are. And it lists out every one of the special revenue funds and and categories it as categorizes it as a special revenue fund. And that's actually where I got I got the list. The numbers are actually taken out of the system. So those are the same revenues just dissected by fund. On the expense side, I'm first I'm going to notice I'm going to point out the big the big elephant. 167 million in revenues. We've got 176 million in expenses. Well, Ben, you're spending more than you're you got to bring it in, right? Part of those cash your cash carry forward. When you save money up or actually spend money on projects, uh, or at least allocate money for projects, those expenses more than likely come down the road, you'll adopt a project, say this year to start next year, and it may take 12 24 months, 18 to 24 months to put it in place. So those expenses will be a little higher the next two years because of that very thing. So you're really spending down fund balance in this case. those allocating allocations. That's what they're there for is you're accumulating cash to be

spent on those projects. Capital is usually uh the biggest reason that those two are different, but you can see the same categories of expenses, general fund, uh special revenue. You can see each one of them that go down through that. Any questions on expenses? uh some of the 25 highlights. Obviously, I'm not going to read these to you, but just u some of the bigger ones. There's transfers that were made to the Riley County Police Department fund. Uh just because of the property tax that came in wasn't enough to cover everything. So, that came out of the general fund. These are highlights that really particularly uh play toward the general fund itself. uh employee benefits and the police uh the caper Kansas police and fire had amendments to them and required sales tax transfers to fund the 25 budget. Obviously, we'll be taking a look at that and making sure that in 26 that uh that we're aware of what's going on there

in any of this accounting known revenue. Do you ever reflect or recapture property taxes past years? Yeah. Delinquencies. Yeah, they're part of that. They're part of the collections every happen every year. Yeah. Would it be helpful to have some correlation of out in the end so we know what the net loss or gain is? Yeah, we can take a look at that. We in fact it's I think it's in your annual financial statements, but we can bring it back to you. It apparently is somewhat of a bugaboo for some people. Yeah. Yeah. The delinquencies are

Yeah. When we look at the 2026 revenue, this is revenue to date. 2026, we're in we're almost in May. Uh but 20 2026 budget is probably as accurate as we're going to get right now. Uh talking to you guys in April, uh this is just what the collections look like uh for the year. I mean not for the year for the through March uh the first quarter property tax obviously a major portion of the property taxes collected really in two payments. There's multiple payments during the year but there's only two payments that are fairly large. One of them happens at the beginning of the year and you can see that orange line um that that shows collected versus the budget. Uh just about half of that number half of those collections have already happened. The rest of it will happen later in the year. Uh sales tax is 29%. Uh

and can I can I just ask year to so revenue to date is this um March 31st?

It's March 31st, right? That's right. Just first quarter. So the sales tax is right at 29. That's that's a good point, mayor. The 29% we're looking at 25% of the year obviously gone. So any from So the 25 is really the the benchmark for these these numbers at the bottom. So your sales tax is right around 29%. Now obviously some of these numbers will fluctuate through the year sales tax is a consumption number. So as you think about how you spend money or how others spend money throughout the year. Uh March is two months in a rear. So we know March was probably January expenses. Uh we saw some real fluctuations when COVID and some of the money that came out from the federal government. Uh when that got spent, we saw some fluctuation in that that as well. So, some of these are not seasonal. Well, they are seasonal. They're just not flat. They're not uh they're not every month the same amount. Uh but what's what's up here for the general fund at least? Um well, this is this is citywide as well, but what's up here for these look pretty healthy based on a 25%. And again, we still got a majority of the year to get through. So, anything can happen from here. Uh, I think the key here is going to be able to keep you guys aware of what's going on on a regular basis. Any questions on the 2026 revenue? That is the front half of the presentation. Now comes the back half of the presentation, the back nine if you will. This really is going to be covering debt and in how we look at debt. Uh we talked

to debt, talk about debt during the retreat, the types of debt there are. We uh broached the subject that we'd bring this back to you at some level uh during the budget process and and here we are to do just that. Uh debt matters obviously because that's how you get a lot of capital done. Uh when it comes to capital spending, a lot of it is is is is funded through debt. There's an enormous amount of it funded through uh grants as well. In this case, it's not just levy oriented debt. You've got a host of different sources and I'll go into the in a little bit more detail on some of those sources. Um, so let's dive in. This is really more of a dissection of that debt service fund I I indicated earlier. That's really what this is going to do is really dissect that a little bit more. This is expenses, and it should be labeled expenses up at the top, but it's not. Bond and interest fund expenses. The orange amount is what I call uh pre2026 uh outstanding debt. This is the debt from 2022 to 2031. The orange piece is is everything that was outstanding prior to the bond issue we're getting ready to issue now. Anything after that is in that green bucket. So the green bucket, and it's important to understand that the green bucket is all the temporary notes outstanding you have right now, 140 million. All of it's been all of it has been allocated out to the future years. And that's what that green does is allocate everything out that you've got currently outstanding into that green layer on top of that debt service. And you can see that you can see it bumps up in 2026. Obviously, it doesn't peak until 2029 and into 30 2031. From that 2031 down into the future, it'll

start dropping. Not fast, but it starts dropping. And I'll show you here that in a minute. Yes, sir. So, I've got a general question on the bond structure and the payments, principal and interest. I was a mortgage loan guy, so I was used to equal payments a little bit going to principal each month, the beginning, a lot to interest. Yeah. But I look at these schedules of the principal each year and they're higher in the beginning than at the end. I think I remember the last bond issue we just approved. Sure. Yeah. It was like It went from 2.5 million up front. Yeah.

In year one to a million five in year two. At the same time, the first year is the most interest you're paying. So why aren't why aren't those scheduled to be more equal of principal and interest? Lower principal payments in the beginning. Sure. Higher at the end.

There there's a couple things at work here on the interest side. What that's do that first year's interest is paying acred interest from the time you issue to the time that you've got that first payment. Typically that's anywhere from 9 to 12 months. So that first one's going to be a little higher naturally than the rest of them. Your principal payments being higher at the front really is a call from management. And I'm not blaming them. What we try to do is is respond really to the rating agencies. They like to see that front-loaded debt. So, you say you got a million dollars outstanding that you've got to pay in in principle. What they're looking for is that principle of a million dollars being paid off rapidly. So, they want 80, not that you have to live by this, they want 80% of that gone within 10-year period on any kind of average bond. Now, a lot of these are 10-year bonds.

Yeah. That means that means by year eight it's it you've got very little left to pay. And what that does is that at that aggressive pay down and I say aggressive might be a little too aggressive but that large principle upfront what that does is help you achieve that metric. But you're right. But it also costs us a lot in the first few years. It does it debt service.

It cost you more to pay that principal payment up front. But when you have pay more principal up front, you're paying less interest in the backside. So what that's doing is is it's it's opportunity cost. You can push that interest to the or the principal payment to the end, but you're just going to be paying more principle or interest up front. And we'll get to this. I want to get to that that subject here in a minute because what you're doing is playing right into some of my notes about three slides ahead. [laughter] And I appreciate that. Um but I'm not going to forget that. I'll bring that back. This is the same slide. What the line does, that line that curves, that line shows the the uh uh fund balance, the ending fund balance for each one of those years for the debt service fund. Now, remember in the last presentation, set of presentations, I showed you a fund balance, ending fund balance that had around 22, $25 million. Wow, that's a lot of money, right? This is why Take a look at when you look at 25, 26, 27, 28, you you don't really spin through that until you hit 2031, right? So, what this is doing right now is a great time to start talking about what do we do in the future, three, four years from now, or even a decision today we can make for 27 to start tackling some of those deficits down the road. Right? So we look at 27 28 we're really it doesn't really it doesn't go negative fund balance doesn't go negative till 2031. So we've got five years. Yeah. We've got five years to be able to make a difference. When when that line went flat I was looking at a $3 million gap per year in 2031 to make that line flat. That means increasing revenues by three

million by 2031 every year they're out there they're four out all the way out. What that's doing is the compounding of that money. Right? As you have that money that comes in and pays that debt, you keep replacing it. That makes that line flat. So it's a $3 million number. Now get to get to that that 2031 number. You could add 750,000 this year. another not we said this year 2027 another 750,000 in 28 another one in 29 and you just you start stairstepping up to that 3 million we've got clients that actually have to hit that 3 million and 27 and that's it which is a really tough place to be looking at a 22 or $25 million fund balance they're looking at going negative next year's budget you guys are in a great position because you can start having this conversation and make decisions today that impact 2031

and continue to have that conversation until you get that balanced out. Now, I'm not done obviously with my presentation. Go ahead, Mr. F. So, the pre26, the orange, yeah, is really all of the existing Yes. general obligation debt. That's right. Doesn't include the 30 million that we approved a couple weeks ago that were correct. That's right. So, the green is is what is now temporary notes, right? That's right. That will convert to long-term debt to long-term debt, right? In this period of time.

That's right. That's right. So, if you look at the orange in 2022, it's the same level as 2031 if we don't advance payment. Correct. But if we add debt like that the green shows we double the debt by 2031

it'll fall shy of doubling debt but it is a substantial increase. Yes. Yeah. I do want to I do want there's some caveats here I want to make at least for the public's sake. I mentioned earlier that bond and interest fund debt payments come from multiple sources. Uh, and this is really kind of hard. It's a busy graph. What I want you to pay attention to is the colors, right? Green in this case is transfers from other funds. Largest part of this is the utilities. Any kind of when you issue debt, you better think back to the retreat. When you issue debt, you're issuing general obligation bonds. General obligation bonds can be used for really any any survey or any capital above ground or below ground infrastructure, buildings, you name it. A lot of cities, and Manhattan's great at this, is allocating revenue out to be able to pay for that debt service. So, in this case, you've got utilities that are using general obligation bonds to pay for projects. Why would you do that with general obligation bonds? They have access to revenue bonds, right? Why not just issue revenue bonds and they just pay those by themselves? That's 200 basis points higher than what we typically issue for the general fund or the general obligation bonds. So the general obligation bonds are cheaper ways to do projects that would and will be paid for by utilities. Now the same thing goes for uh other revenue special assessments. You can see in purple the blue the dark blue is property tax and I'm going to have advance one slide and you'll see it a little bit better. The light blue then is sales tax. But that green bar, the overwhelming majority of the revenue coming into the debt service fund is actually from other funds. Uh it's not just utilities. These are a number of other funds that generate sales tax, economic development tax that come into this fund itself.

When I take out the transfers, this allow this allows you to see see the uh the rest of the revenue a little easier. Uh notice on the very far left the $16 million uh axis 16 million to zero. All this does is really take it it blows it up a little bit bigger. So you can see the previous one by taking the green out of it. And you can see in 2019 the property tax that darker blue was a fairly substantial part of the revenue. The debt service fund that's what you had to work with when it came to debt. sales stack slowly started becoming a a bigger and bigger piece of that pie. Uh and in 25 sorry 20 really 212 the sales t the property tax itself started dropping the revenue started dropping as the sales tax went up and so what this chart really does is show you the general revenues that's not allocated uh toward uh any kind of utilities. This is going for everything that's non-utility debt that's not collected from other funds. So if you've got a parking garage that's that's part of a Aggieville, then that's being paid for from Aguville sales tax.

I mean questions. So that lower reliance on property tax in my mind is in part because the voters approved a sales tax to pay our debt and alleviate some of the pressure on real estate tax. So it did what it was voters voted to do.

Yeah. All I'm doing is presenting the numbers. You you I wasn't here whenever you That's very well possible. Yeah. Commissioner Fox, I I also wasn't here, but I do think it's important to note uh when we do go back and we do look at those policy discussions that were had in 2023, it was never um discussed to lower the bond and interest um mill levy as part of that conversation. So, while we do talk, you were here, you were in the community, I was not. Um so, we can certainly pull minutes, we can certainly pull presentations, etc. Um but um it's my understanding from staff at that time that that was not part of the conversation when we approved the 2023 sales tax. I just think that's important. I I do want to point out one thing and you you may already know this. Uh sales tax is obviously a very volatile revenue that comes in. Allocating it toward fixed payments is a little bit risky. Rating agencies don't really care. When it comes to general obligation bonds, they just look at well, they've got access to property tax. That's what they'll do if if they need to. So, they don't care. So, I set them aside. This is really from a say a finance officer standpoint kind of viewpoint. uh your your fund itself, your property, your your revenue is diversified. Obviously, your green coming from transfers from other funds that are fairly fairly stable through that five-year window that's really stable in that green. U so those funds are stable. When you look at the consumer taxes, the especially sales tax, it can fluctuate obviously and as it fluctuates, there will be a need to replace it. Uh, I know in when I've looked in the history of of of Manhattan, your sales tax hasn't

really moved a whole lot. Even in even in recessions, it doesn't move a whole lot. It doesn't grow a lot, but it doesn't it doesn't move a lot as well. So, that that's actually a positive. I wanted to be able to point this out to you guys. The that brown kind of dirty brown other revenues is uh is a number of different other revenue types. uh your uh parking parking fees. I think over at the airport, there's a number of different things that make that up. When we look at the overall resources, this is just another slice and how to how to look at the overall uh revenue picture. What this does is take that first slide and stack up the revenue sources so you can see actually what the top looks like, what your what your growth is. Uh so from 2019 we're looking at just over $20 million uh with a small spike in 2021 and then from 23 to 27 it grows again. When we look into the future on the fund resources uh again it starts dropping off. Now this decline is obviously faster than what that expenses are declining at the same time. So the expenses are coming down slower than the revenues themselves. Uh this is the last slide and I think we kind of want to talk a little bit more about this. The things to consider obviously as we move forward into this budget uh is bringing back to you to discuss other revenue sources that can augment what we've got in that bond and interest fund. reallocation of funds themselves whether it's levy coming out of other funds into this one uh to replace those funds uh and then one of the bigger ones at least for me is the consideration of some type of fund balance and debt issuance policy I

strongly suggest you consider something like that and the reason I think that is because that's the next layer of what the rating agencies will look for and I know I'm pushing those guys the higher that rating is the lower your cost of borrowing is And one way or the other, I don't know a city that's as energetic as Manhattan that doesn't do debt at some level. And if you're going to do debt, let's do it as low as cost as possible. And to do that, policies are a great way to say here's what we're going to do. It also gives us guidelines into future administrations or future commissions. Here's how we're going to do this. There's a number of different things obviously that can be considered. uh there's certain metrics that can be folded into some of these policies. We write policies uh for entities as well. So there's certain there's certain type of metrics uh your debt per capita matter on on on how you look at things. Cash balance, your available cash balance across the city, not just the general fund, but I'm talking about across the city. All funds including utilities, how big those cash balances are matter to what to how to how you borrow funds and what those rating agencies look like look at. Uh your A1 rating obviously can change based on based on and positively based on how those those percentages move. Uh how you use debt. Uh for instance, do you go straight to general obligation instead of using temporary notes? We could look at projects and say, "Well, we know what the gross the that the maximum price is and it's not going to move." Well, let's issue a bond in that on that instead of doing temporary notes. You issue the bond. We can set the revenue that matches that debt service and we run don't run into this again. But there's a number of different policy uh issues that we obviously we can bring back if Danielle and Jason let us. That's what we do is bring that

policy back to you guys to consider as part of that budget. Um obviously and then Danielle already mentioned that there's sales tax renewal that's built into this as well. So I guess I'm being new I'm a little surprised we don't have a policy in the first place but you know speaking to management has anything been done to well let me let me caveat that a formal adopted policy is really what I'm looking at right a lot of times entities especially city managers have a policy in their head that's what they go by in this case would be an adopted policy

uh it is my recommendation um as we wrap up and we get to a point and we're in 2027 and we have our budget development wrapped up, uh it is absolutely my recommendation to start working on um some financial policies. Um particularly when it comes to what our um cash balances are. Uh once we start talking about cash balances, we can start talking about reserve

reserve policies and once we start talking about reserve policies, we can start talking about um how we want to move forward on how we issue debt. So yeah, this is uh been on my list of goals. um that we will talk about um here in October when we wrap up budget. Uh one of those conversations. I know that Reena um and her team have also been um looking at reserve polic or not reserve uh cash balance policies and reserve policies um for the last several years, but wanted to make sure um that we were in a stable position um with our uh general fund particularly and with our bond and interest fund. um that we didn't want to put a policy in place that the commission would then be uh violating or having to make a decision to not follow its own policy within a 12-month period. Wanted to make sure it was stable enough for us to have a policy in place.

And that's great timing for the next year when we issue temper notes or John long-term bond. Sorry. Um you've given us a snapshot of a picture in time where we are right now. Right. Right. So, what about future indebtedness? What are future um growth and bonds and that kind of thing? How do they impact you know the curves and the blue lines and that kind of thing?

That's a great question. When we discuss CIP, that's the where that discussion happens. When we break CIP out amongst the different sources, right? Operating revenues. Let's just take uh water water wastewater. If there's a grant, then that will pay for a project. you peel that off and show it as a grant expense. If it's part of the the rate structure that you're paying for on capital, then you'll peel that off. If it's debt, then we fold that into the proforma, the forecast that we show you guys what this looks like. Remember the orange and the green. Okay. Well, this is what the rest of that looks like. If you have a CIP and we're going to stack that on top of it, kind of get used to that orange and green because there'll be another layer in there, but then here's where that money's coming from. So, what comes to you on a CIP is a performer for debt at the same time. That way, everybody's above board, especially the public, on how that capital is taken care of. Uh and then part of that that policy discussion, ironically enough, we're talking about debt is how do you use cash versus debt? When do you make that decision on which one do you use? Right? That's where that reserve and cash balance come in really important is if you hit say 10% above your target, is that an ability then to take that 10% scrape it off, put it in capital and use it for cash? use cash projects then that could be right every year. But anytime we used to look at capital or any kind of CIP and you guys do that we bring you a CIP that's how it's broken out. Here's the debt funded projects and this is what it does to that debt picture and that should go in not just the presentations to you guys. It should go into the budget book. So then it's it's sealed in there and everybody knows from the past what that looked like and how that discussion came up.

That's a that's a really good point though I forgot. Um our A1 stable rating um is that pretty typical for the cities you work with?

It is there if there's a bell curve it that if there's a bell curve for ratings it peaks between double A and A. Triple A obviously is the highest you can get. I don't recommend that. But the the double A's and the A's that at peak is right between the two of them. All in that peak is just the number of entities that have those type of ratings. Yeah. Any other questions that or points that I missed from you guys perspective from yours? If you have no other questions, we'll take public comment now.

So, you say things to consider looking at other revenue sources. What other revenue sources are? I know we've talked about

we we've talked about several things. um you know, we really um haven't had a whole lot of time to sit and think through those those opportunities uh just yet and to be able to talk about what the impact of those revenues uh would be. Uh we want to um as we start having additional budget conversations, bring forward what some of those ideas and some of those strategies are. Um, however, tonight I would really just like to focus on getting our arms wrapped around uh what our debt uh challenge is heading into our um 2027 budget development. You know, uh well, mayor, I know you want to take public comment, but before we get into public comment, I think, you know, I kicked off this conversation just saying um to you all that there were policy decisions that were made by commissions previous to you all. um they made the decisions that they did with the information that they had available to the time and that they felt was in the best interest of the community. Uh we want to make sure um and the reason we're having this debt conversation with you all and presenting it the way that we are is so that you all um can do the same and make a decisions uh regarding our debt, regarding how we budget in 2027 and 2028 and forward. um and starting to look at some of those uh policy decisions of of cash balance reserve policies, how we issue debt in the future and looking at those policies and having policies in place. So um you all will have an opportunity to u make very similar decisions. So we wanted to make sure that we had that information in front of you tonight.

Thank you. Danielle, do you before we move to public comment, do you want to uh make any remarks about um this rather large

So, uh what the mayor is referencing is a uh very large uh 11 by17 uh spreadsheet that we pulled together for the commission just for reference um as we talk through the history of our mill levy uh where it has been um as far as um not just the cities, but we also wanted to show uh USD 383s, the counties and ours. And then we even broke ours down into the different um funds that we have um that are mil levby funded. So the library is on there as well. I think one of the interesting pieces as the commission is digesting this and we can certainly make sure that we make that um spreadsheet available um as part of the packet materials as well. Um but what's interesting to if you take a look at it um you can see that the um do you have that sheet in front of you? No. Uh the average um I just want to make sure I don't misquote um speaking from memory of a 11 by17 spreadsheet. Thank you, Commissioner Morrison. So I think one of the interesting things to note if you look at that mil levy analysis um at the top from 2010 to 2025 the average uh mil levy increase has been 1.82%. uh the counties has been 1.15 and USD uh 383s has been 1.28. So this is really just forformational purposes. And then um if you look over um at where we are with our um average increase of valuation, you will see that since 2010 the average increase of um assessed valuation has been 3.68%. So if you uh add those two things together and you take a look at what our percent of uh value assessed valuation is plus what those increase um has been um we are looking at about a 5% increase um averaging over the last 15 or so years. So I think it's just important to

kind of have an opportunity to look at where we've been. Um and then uh as I mentioned if you pop down a little bit lower that mill levy analysis um taking our the cities and breaking that into our general fund our bond and interest employee benefit equipment reserve KPNF library uh employee benefit fund and then um RCPD as well. So just taking a look at all those different things and just wanting to be sure that you all had that information in front of you but we will make sure that we include this in the packet as well. Thank you, Danielle. Um, is there any commissioners? Any additional questions or can is there anyone who

It's still a little bit I don't I don't think I have my head fully wrapped around what the debt situation is. I did when I looked at the last year's bond um issuance paperwork like when it has the debt schedule and had specifics of everything, I liked a lot better. It made more sense. Um, so just trying to find a way to, you know, try to h try to get my head around what the problem is and how bad the problem is and um because but like you like a lot of the temp notes wasn't in that they wasn't in there. It was just the the bond. So the temps are kind of the unknown factor I guess a little bit. Ben perhaps can you u address whether the um the level of debt that we are carrying how does that relate or compare with other comparable cities?

Yeah, that's a that's a good question. uh part of the comments for the rating agencies said that that there is a elevated and this these is their words elevated debt level uh that's mitigated by stable revenues is what they call it within the letter that they write. Uh so there's an elevated number when when I say that when they say that what they're doing is comparing all the other single a category cities on an average what their debt level is and compare it to yours. Anytime they look at cash balances or they look at a yeah cash balances or any reserves they're going to compare it to yours. So it is elevated but obviously it's mitigated by by your stable revenues. It's not all property taxes, I guess, is what they're saying.

Uh what matters in that too is overlapping debt. So, in other words, debt that the county has, debt that the school district has. Daniel just me mentioned a number of those that are levies that we don't own, that the city doesn't own, th those entities also have debt. So, when you look at one taxpayer within Manhattan that encompasses all those entities, that's considered the overlap in debt. Uh, so that's also a number that they use. That's one of the numbers that you can't impact. You can on your side, but you can't on their side. Ben, will you please speak to Commissioner Von Lentil's um question uh because that green um chart actually does include our temporary notes.

Yeah, I want to make sure that I come back to this chart right here. For me, this chart shows probably the best that I can show what that gap looks like. So any debt you have outstanding right now, general obligation bonds particularly long-term. So these are the orange is anything that goes beyond a one-year note. These are the those are all long-term bonds. So they're anywhere from 10 to 20 years. Most of them are 10-year bonds. the green, what that is, is taking all of your temporary notes, which is 140 million in temporary notes, and allocating those out into future bond issues. So, this picture right here has everything that you have outstanding right now and showing it in a long-term bond issue. So what this says is in if you do nothing else in your CIP, this is where 2020 2031 is going to be for the debt that you have right now, including temporary notes. So the temporary notes are in the 20 in the green. I know that that may be kind of confusing.

I I think what I So if if I had So you're showing what our payment No, you're showing our um how much is left in the cash account. Yeah. In the line in the line the line right right and so like even if I just had for 2025 what the payment was 2026 was yeah yeah maybe extend it further or have an alternative where okay if we add the if we add half a mill to this Yep. then then we we can extend it to 2020 2035 or you know that's

because what's behind this is a spreadsheet I think is what you're talking about is all the current debt and then here's all the temporary notes and then here's the revenue and what you're asking for is really what those numbers look like right and we're spreading them out and and that makes sense some people think in pictures other people like me and you think in numbers yeah that makes sense and that what what's behind this is everything that everything you have all the debt you have is what's behind this Right. But this is the one that shows the gap. And I want to reiterate when you look at this gap long-term, no additional capital projects. We're looking at a $3 million gap. That's the target. In 2031, it's a $3 million number that goes out into the future. So any C and this is making the assumption as we do CIP this year each one of those projects are going to come with the revenue source making that assumption. So all we're doing is dealing with what we've got in front of us right now and that's what this is doing.

So I think in dealing with our debt it'd be in informative to know of that 300 and some million dollars in debt. Yeah. Breaking it down into the different categories. I know we have a big debt on the maintenance facility. We have airport debt. We have levy debt. We have Aggieville debt. We have north campus corridor debt. Yeah, we can do that. You know, that's not a problem. I think that would be helpful to Yeah. know where all that debt special a lot a lot in our residential areas for special assessments.

Yeah. and with the caveat that some of the debt that's going to be coming on in 27 89 they're all forecasted obviously with interest rates that haven't hit yet but yeah it show what the project what the projects are that's one thing I've been impressed with what staff has done is at nauseium there's projects that are out there and and different ways to slice this it's not something I did I took their numbers which fantastic that they had this by project and note issue bond issue so what you're asking for is is is not hard to do. Great. Do interest rates have an impact here? They do. They do. Uh it

they do. They u right now short-term rates are around 3.25. Yeah. Which is really great. They've been good rates, right? And you'll see that here hopefully or pretty soon. And your long-term rates, you'll see something I'm hoping in less than 4%. what we've built, what I built into this thing is anywhere from four and a half to 5%. So that does impact this. So you also have to build in inflation then. I mean Exactly. So if we were to see inflation higher than the interest, then we would have a more positive return. Exactly. It won't close the gap, but it'll show you a better number. Okay. I mean that obviously the inverse is true, too.

Yeah. You mentioned several policies we might have to address with a policy we ought to address is how we create debt and projects we do in spending spending policy. Absolutely. Absolutely. In your review of our stuff, do we seem to have one at this time? Uh your debt policy? No. No. Spending policy.

Spending policy. I haven't seen one, but I haven't really dug into it either. Your biggest policy document I can't add. The biggest policy document you consider every year is that budget. Once that budget's set, that's your policy document on how things get spent. To amend it, we bring it back to amend it and then obviously tell you or request that amendment based on what those uh uh what those changes might look like. Uh and that it was amended last year for 2025. Uh but that that that would be your biggest spending policy of the year is that budget document.

All right. Um is there anyone who would like to make a public comment this evening? All right. Seeing no one approach the podium, I will close public comment. Thank you all very much. Uh Commissioners, do you have any additional questions right now for staff or for our consultant? Danielle, do you have any additional comments?

Yeah, just closing comments uh for this evening. Uh we will um hearing comments from you all. Uh I think homework for us um is really bringing back some additional details um regarding what our payment is. Um bringing back some uh project specifics. I think what I would like to do as we start heading into budget development is starting to put together some scenarios um regarding some of those um revenue other additional revenue sources that we potentially have some of that uh fund reallocation um that we've been contemplating. Um and then as well as um what we can do to start looking at uh potentially moving um some of those mills around and maybe adding shifting mills from our general fund um into uh back into that bonded interest. So it's our work now um to take this back and start putting together some scenarios. Um, and other than that, we will keep heading into uh, budget, starting to really get into the meat of it, but wanted to make sure that you all have this information in front of you. Um, I do know it is a lot of information and it is a lot to kind of wrap your head around, and you'll probably, if you're anything like me, go home this evening and be laying in bed and think, why didn't I say that or why didn't I ask that? So, um, you know, we are here to answer questions. we don't have to um adopt our budget until officially until September, but we will start getting um into really heavy discussions in the next couple weeks or so. So, please bring those questions forward to us and we'll get them answered.

Thank you for your this to the staff for preparation for getting this underway. Um I think it's been very helpful for all of us. I don't recall that we had uh this depth of conversation on the previous several years that I have been on the commission and so I think it's a really great opportunity for us and I know that uh a lot of effort went into the preparation. Thanks commissioners. I move we adjourn. [laughter] Is there a second? Second. Uh all in favor please say I. I or raise your hand. Thank you. We're adjourned. [laughter]