Finance Committee - Regular Meeting

It is 537, and I will call the Finance Committee meeting to order. First up is Roll Call. Tonight we have the entire committee present. We will move on to public comment. Is there anybody from the public that wishes to address the Finance Committee this evening? Yes. Please come up and state your name and address for the record. Come up to the table with the microphone.

So, hi, my name's Esther Watley. My address is 1512 North 23rd Street in Manitowoc. And I was applying for a bartender's license. This is the right place and time. I've never done this before. So I just have a couple letters of recommendation. They said that I was probably going to be denied because I have a charge on my record. And so I was just coming to hope I can get that overlooked or...

Okay. Sean, do you want to explain just that we can't have it back and forth? Okay.

Okay.

Okay, thank you.

So I am applying for my license. I used to bartend when I first moved here, and now, like I said, I have charges, but I don't think that that has anything to do with my position. I took a plea deal on something I waited for about three and a half years to have a court case on. I felt like I would have won it, and so I wouldn't have had the charge, but... I just hope that you would look at my few letters of recommendation and give me an opportunity to be a bartender in Manitowoc again. I think that's it.

Okay. Thank you. And just so you understand the process, we're going to go into closed session and discuss these towards the end of the meeting. But this was your opportunity to address the committee.

Okay.

And Sean will pass us all the information.

Okay.

Thank you. Is there anybody else that wishes to address the Finance Committee?

uh good evening you guys uh my name is ismael reyes um i'm here today to see if i can get my bartending license as well in the city of manitowoc i currently live at 4341 country lane manitowoc wisconsin i have lived there since of may of 2022 prior to that i did live in sheboygan and have my bartending license for about three years in sheboygan After moving to Manitowoc, I've had different positions in retail, helping customers. I was a shift leader at Goodwill from October 2022 to May 2024. GameStop from July 2024 to April 2025 before they closed. And I am currently employed at Covered Wagon, the restaurant, as a waiter and cook since April 2026. My employment at Covered Wagon also includes serving beer and wine to restaurant customers. The owners of the establishment, Wendy and David Russell, asked that I apply for my bartending license, which they have a Class B and Class C liquor license selling wine and beer. As many as our waitstaff are minors and not allowed to serve alcohol. I have also served alcoholic beverages at St. Thomas the Apostle Picnic in Newton for the past three years under the supervision of someone with a bartending license. I had previously applied for the beverage license in the city of Manswalk in October of 2025. I appeared before the license committee in November and was denied a license because I had an open case pending. I was told at the time to reapply after my case was settled, and I would see if there would be a possibility to get my bartending license. So therefore, that's what brings me here this evening. If you guys can, you know, just look it through. Thank you, guys.

Okay. Thank you. Is there anybody else that wishes to address the Finance Committee this evening? Third and final call for public comment. Was there anybody online or previously received public comments? Okay. Then we will close public comment and move on to the consent agenda. Is there any item that any member of the committee wishes to have removed from the consent agenda? Seeing none, I would look for a motion to approve the consent agenda.

So moved.

Second. There's a motion and a second. There is no discussion on consent. So all those in favor? Aye. And opposed? All right, we'll move on to our discussion and action items for tonight. First up is 26-0689 is second quarter claims from the city attorney's office. Eric is not here, so Sean.

I'll sub in for him, but this is the quarterly report that the city attorney's office gives that shows details of all the claims that have been brought forth to the city as of the date of when they are when they are finalized or filed as well. So that's why I just say that because there's a couple on there from 25, but action didn't get taken care of until 26. If you look through them, I mean, outside of the alleged mailbox damage from the snow plows, which kind of are numerous on there, not too many that are very...

uh material um outside of the number one claim that this was uh the committee saw and discussed before so uh is there any questions that i can take back to the city's attorney's office based on what's on the report any questions from the committee is alder dunbar i just have one i'm sure it's just me not understanding it has alleged damage to rear view mirror on vehicle from snowplow i'm guessing it means a side mirror because i don't know how the rear view okay that's what i figured i just wanted to clarify

That's all. Any other questions from the committee? Seeing none, then I would look for a motion to replace on file. So moved. Second. Motion and a second. Discussion? Seeing none. All those in favor? Aye. And opposed?

Okay.

I'll put that on consent if there's no objection. Next up, we have 26-0690, second quarter 2026 budget exception report. Sean?

This is the quarterly report. The finance department works with other departments that ultimately show any area of a department that's over its individual line item budget for the year thus far. And then we ask for explanation on the root cause, how we're going to mitigate or what not spend as much to cover that budget or any other circumstances that would give the help us understand why we went over the authority given for that line item this is fairly common as far as second quarter and there are a number of things in here that are minimal or as you read through many of them the departments are fairly confident that other line items can cover the expense of overage If there's any questions, I'm open to discuss. Otherwise, I would just need a, looking for a recommended approval of the report, please.

Okay. Any discussion from committee or questions? Alder Reckleberg?

Refresh my memory again as far as this year's budget. Did we budget anything? I thought there might have been, it might have been a small number, but it was for the, payouts of the retirements and the this and that, because I noticed the $65,000 for unanticipated retirements of detectives, sergeant, police, blah, blah, blah. So based on the account number, I figured it was in the...

police area sure what uh 65 is kind of a lot to make up but did we not budget something or did we cut it out or refresh my memory yeah yeah so what happens kind of and this is a great time to talk about it with 2027 budget processing beginning uh but ultimately uh right now at this time we around the august time frame we send out the employee listing to the departments and ask them to uh discuss with their staff of anyone who's planning to retire. And then if they indicate, yes, kind of trying to figure out which month, and then we ultimately calculate their payout. But what has happened here, and especially in the police department, the individuals, they did their due diligence and got the appropriate amount of numbers of people who are anticipating to retire. back in August, September, then we set the budget, and then it just so happens that there were two people that determined to retire unexpectedly, and they were longevity employees, so they had higher balance payouts for sick leave, vacation, and they were union employees too, so those balances can be larger than non-rep employees. To your point, yes, it was budgeted. That $40,000 of being budgeted was the anticipated of two employees, and it just turns out a couple additional people decided to enjoy life a little sooner.

And that's going to be made up within their budget, or is there that other account that will maybe help it out a little bit? Don't ask me what that other account is. My memory is gone.

Right.

But there was a salary adjustment account or whatever it's titled that kind of has a pot of money for.

We used to have that. And then a very astute council member joined and we removed that from the budget. So we no longer budget that additional money in the contingency on there. We removed it two years ago. So can we make up the 65 to be determined? It would be, we'll find out together as a city to see what happens.

Thank you.

Okay, thank you, Alder Reckleberg. Any other questions from the committee? Seeing none, then I would look for a motion to accept and place on file. So motion and a second. Is there a second? Second. Motion and a second. Any discussion on the motion? Seeing none, all those in favor? Aye. Aye. And opposed? Okay. I'll put that on consent as well if there's no objection. Then we have 26-0691. It's an application for Class B retail intoxicated liquor fermented beverage license for Green Street FSA LLC. Sean? Looks like a transfer of agent.

Correct. The former person, the former owner is selling it. So then it's... I'm just looking for an approval.

Can we look for a motion to approve?

So moved.

Second. Motion to approve in a second. All those in favor? Aye. And opposed? OK. Then we have 26-0292, which is the HECR VBOD Agricultural Land Lease Renewal, which has been a – Sean, do you want to speak to it? But it's the same terms that it was previously, and the revenue goes to MPU?

Correct. Yep. So this was the new term that we're looking for. The last one that was done was in – 22 through 26 so we're a little behind on getting it renewed but we've had included the original one on the agenda item on granicus and the amendment that we did a while back due to the cottage we cut down some acreage but really just looking to renew the lease and within the terms of the lease there is provisions where if we needed to take over that land for development given the where it is in the kind of the TID 23 area, it is allowable. But ultimately, too, as Alder Sickowitz said, we own the lease, it's our land, but as a provision, we have to give revenue to MPU as part of a land lease contract.

Move to accept or approve.

Approve as presented?

Yes.

So motion to approve as presented. Is there a second? Second. Motion and a second, I think, by Alder Schleich. They both. Ty goes to the runner. Second by Alder Schley. Discussion? Seeing none, all those in favor? Aye. And opposed?

OK. That can go Arkansas as well.

Then we have 26-0698, scope of engagement for proposed issuance of $5,637,070 for taxable private revenue bonds.

Sean, do you want to cover those? Yeah, sure.

So this is similar to...

We've had four of these come across your eyes previously in 24 and 25. So what it is, is really if you rewind back to last council meeting, Rob Michaelson from NPU talked about the lead service lateral and the replacements. This is the next big provision through the DNR that they are going to give us a loan that has some principal forgiveness of 50 so in total we're actually going to get about 11.2 million and we'll see that kind of talked about at the next in the next agenda item actually and then we are on the hook uh as the city and mpu for the 50 that gets transferred to the parcel owners um so it's we're gonna get our lead service levels replaced and um this is ultimately corals and brady is the disclosure council who's gonna be in the city's corner as we go through the coming closing process with the state that will occur towards the end of this month, early September. So it's just a engagement. There's no cost on our end. It's all included in that loan agreement that essentially is transferred through to NPU.

Okay.

Any questions from the committee?

Motion to approve if there aren't any.

Is there a motion to approve and a second? Second. Second by Elder Schley. Discussion? Seeing none, all those in favor?

Aye.

Aye. And opposed? We'll pass that for signatures. And Sean, you want to speak to the next one, 26-0699? Yeah. Which is the resolution?

Yep, this is the resolution coming forth because what's going to happen at the end of this month in early September, we're ultimately going to bonding. This is very similar to what we see in the February time frame of every year when we're doing our bonding for our... capital project budget. So similar resolution, similar process, but this is just a little different because it's coming from a state DNR fashion and we're not actually going out and bonding or selling to investors to get there. This is strictly through the state. The reason why we have to quote unquote bond or issue the taxable private LSL replacement revenue program bonds is They're going to give us the principal forgiveness, so DNR is going to treat that as a grant. The other remainder is on the city, but ultimately in this program, as the lead service lateral is replaced, the parcel owner gets the invoice, and then they can either pay up front or enter into the City of Manitowoc lead service lateral agreement loan. In all of that said and done, the bonding referenced in here and the principal and interest going forth out for the remainder of the schedule of payments would have no fiscal impact on the city. It's either the parcel owner or it's all the parcel owner on that. So but it's bonding we're putting it kind of the bonding where we're putting our assurance that those people are gonna pay us back The risk for us is as with tax bills and everything else if they don't pay us back then to be determined Questions from the committee otherwise look for a motion to approve is presented Second motion and a second discussion

Seeing none, all those in favor? Aye. And opposed? Okay, we'll pass that for signatures. Next up is 26-0693, Discussion on the 2027 Budget and Requests of the Mayor from the Finance Committee. Mayor? Thank you.

Well, one of you heard from the last committee, so I'll kind of rehash a little bit, but just want to see if there are any questions, ideas, suggestions, things that you would like to see as we move into the 2027 budget. Budgets are due from each department to myself and finance by the end of this month, and we start putting it together throughout the month of September. So if there is anything... that you would like prioritized within the budget, now would be the time to tell us. Obviously, you've seen the road plans and all that, what's scheduled for next year. That's what we're kind of working off of for roads. And since you're the finance committee, you hit everything, but I will be going to every other standing committee to talk a little more specific with parks, and I was just at personnel for the last one. So I did send out a budget memo to department heads. I copied in the chairs of committees. So three of you saw that budget memo. But in there, just kind of detailed kind of what some guidelines are as department heads plan for the next year's budget. Just looking at where we are now and what next year may bring, not looking at adding any new positions. My goal is to retain what we have. There's no recommendation as of right now of what non-rep wage adjustments would be. Usually we get data starting in September for how we can build that. I have implemented a hiring freeze, so any position that does become vacant between now and the end of the year, unless it's deemed absolutely necessary, will go unfilled. We have had good fortune this last few years of having full employment really in almost every department. There's only been someone retires, but you fill it right away pretty much. which is a good thing, but it's also, we relied sometimes many years on dollars that we did not have to spend because the position was vacant for quite some time. Um, so when we have talked about, you know, equity adjustments or things like that for the electrician who might get another job because private sector is paying 10% or whatever, things like that are starting to become more and more slim. Um, and also as I mentioned in the budget memo, we have been using fund balance applied, to offset the budget in lieu of raising taxes or making cuts. Again, when you have full employment and 80% of your budget is wages, when those are being realized 100%, there's not much you can save throughout the year and put back toward that fund balance applied. So one of my priorities going into the budget, and Sean can tell you a little more about it if you want, but is to see if we can reduce that number. I'm not worried. We've hit that number every year pretty much. We've realized it, and so we haven't had to reduce our undesignated reserves or anything drastically because of that practice. But last year was a larger number than I think both of us are comfortable with. But again, to change that, it's either cuts to expenses or increases to revenue. I don't expect to see too many large increases to revenue. State shared revenue is pretty much flat. We did have some increases over the years, but that's flattened out, basically. And it's also dependent on the sales tax revenue that the state gets, so there's some new formula there. But not anticipating getting... a lot more money from the state um we are not in a reval year so um you know the the levy that will be potentially increased will affect everyone equally unless your house was specifically revealed and different but um So that's kind of where we're at. It's a little grim at this point of the year, but those are my kind of priorities moving into it is when we do have open positions, really taking a harder look at each position to see if there are efficiencies that we can gain. We have done that already. For example, when we reorg'd the park and rec department, kind of did that model looking at doing that In other divisions now moving forward, engineering being probably the first one that we're looking at. Organizing potentially differently, hopefully for some savings, but that's a unique division because those are very skilled laborers and unique skilled laborers, hard to find sometimes. So yeah, that's Sean. I don't know if you wanted to add anything. That's kind of the gist of where we're coming into it right now.

Correct, yeah. So we're just really trying to, as the mayor said, 80% around it is the personnel cost. So if our levy remains somewhat static, what's our alternative revenue sources? Where can we get alternative revenue? Or ultimately, where can we reduce expenses? So one of the things he mentioned as a direction from him and I is to ask the departments to really evaluate what we call the non-personnel expenses. So anything from whatever they contract out or they're supplies and materials and evaluate the request was to see if they could cut them by 5% and still survive. 5% is it going to be huge to be determined, but at least it's it's um i think many department heads would say they don't want to lose staff so then how do what do we do it's either the alternative revenue source or there you know another option too is like you said you mentioned where else so where's our footprint as well we have buildings that aren't needed um can we condense you know as we were much larger than others but that's just kind of the gist of like where we're the directives were given and we're going in just knowing as he mentioned the unbalanced applied has been realized and we are full so but as i mentioned we're just looking for um your input or anything that is in specialty that you would like us to focus on okay thank you i'll open it up to the committee if there's any directives for the budget all the record

Well, my constituents have said no tax increase. One of your memos, I believe, says you're kind of shooting for that, at least directing staff to try to come in with a 0%. Doesn't mean they are, but, and as I've explained to you many times, I'm the bottom line guy. If it's this project or this project, it's a horse of pieces. You know what I mean? It's the bottom line. And so I'm going to be looking at the bottom line and what's the, is there no tax increase? Is it a 1% increase? I could probably live with it because on the other hand, I want you to make sure that our non-reps are taken care of properly. None of this, the personnel, Contract person comes in and says, well, they probably should get a 2% or a 4% or whatever. Whatever that number is, if that's what it takes to keep in the ballpark with our non-reps, that's what I'm going to also look at. So what I'm asking you to do is not easy. Take care of the employees. Watch the project list maybe a little more carefully. deliver a 1%, 2% tops or a flat budget. I mean, it can be done, but it comes down to what decisions do you make and then can we live with it? And like I said, all I wanna do is make sure our non-reps, the representative will take care of itself because it's a bargaining situation and if they agreed to it, well, they agreed to it, so, but. Just take care of the non-reps. I never want to be at the top of the game, but I certainly don't want to be at the bottom of the game. You know what I mean? You always want to say, hey, we were fair. It's in the ballpark. You can't do more than that. So that's where I'm coming from. Thank you.

Okay. Thank you, Alder Reckleberg. Alder Schley.

Thank you, Mr. Chairman. I have not spoken to either the mayor or the finance director about any kind of Targets for an increase but anybody that looks at the current economic situation that we're all in including the city Anybody who expects no increase I think is living in a fantasy world because everything costs more diesel gas groceries supplies You name it. I don't I mean I I'm a taxpayer here, I don't wanna see taxes go up, but I'm also a realist and I realize I'm paying more for everything else and so is the city. The only other alternative to a tax increase this year I think would be cutting services. And I would beg anybody in the public or here on this committee or on the council to come forward and say, what services are we gonna cut? because I don't think anybody's gonna wanna cut services. That's all I have to say, thank you. Thank you, Alder Schley. Alder Dunbar?

Yeah, thank you, Mr. Chairman. So one thing, I didn't know if when we do get the budget, you know, the nice big thick binder, know there's always those projects that we've kind of been piecemealing money here they're putting aside i know if we just get a summary sheet maybe towards the front um just saying this park we put a hundred that red area we put a hundred thousand we're planning a hundred thousand here and a hundred thousand net just so we can kind of piece that so when i look through the budget and i see i don't have to break out another binder to remember how much we put aside the previous years we just maybe get a minus three plus three whatever that kind of looks like um just a quick little summary sheet on the beginning Um, and then kind of in that same line, if department heads were able to look at those costs and maybe another, uh, set of expected, even if it's not being asked to be put on this, if they're like, you know, we had the, was it the emergency service truck? The, what was the one called? The, uh, It's like a specialized truck to that, you know, that came out and there's that kind of, when did we order it versus when do we pay? Cause there's that whole, and maybe just a three year runner on something like that. And I'm not talking the big ticket items, obviously sometimes stuff breaks that just, Hey, we know, engine one's got three years left before we need to start talking about it. I always feel the further out we can see from those. So I don't know if we wanted to put a line on that. Any item that's going to be a purchase of over $150,000 in the next three years, just to try to get as big of a head up of that, even if it's not directly on this budget. And I know it helped me track stuff moving forward and all that. But mostly just that one of any actively that we're putting money aside for from previous budgets. That summary would be the big one I think would help a lot.

Just to make sure I'm hearing exactly what you're saying. So like Franklin Street? We had money that we budgeted for engineering last year. We'll have half the project next year. So you want to see that how much we spend. Just like a one sheet summary. Or like the ladder truck for the fire department. Exactly. Multi-year.

Yep. So on the top line, we'd just be like 22, 23, 24, however many years. And we just that. I know sometimes, like I said, I got to flip back to say, well, I felt like we put $100,000. Oh, we did put $100,000 last year as well. We planned on doing this for four years before the project. Just kind of a summary of those. Again, that way I don't have to flip through 400 different binders. It would make it easier. Sounds good. Absolutely. Okay. Thank you.

Any other directives? I guess mine would be pretty simple. I think it would be that And I think, Sean, you do a great job of it, is speaking with reality from there to the council on some of our unintended consequences that we may do in trying to solve issues that sometimes we create ourselves and sometimes we do. Like, for instance, in the budget exception report when we talked about the payout, it was a couple years ago that that fund was gone after and removed from the budget. And now we have questions on what are we going to do. i think some of the times the unintended consequence is good to know obviously they're not always known but that's the other aspect of it is i used to say that the budget season was my favorite season because it set our spending priorities for the 11 months it would seem that that's been flipped on its head and that we've gone crazy with some of the spending in the 11 months and then we try to figure out during october and try to make it work for the following year when, you know, I hear that we want to make sure we take care of our non-reps, and I don't disagree, but then we also have our union contracts, which they have a say in, but so do we when we approve them at 4% and 5%, and then we say that we don't want any increase. Well, unless we have a magic revenue item that's coming that I don't even, that the mayor doesn't even know about, that Sean doesn't know about, it just doesn't balance on its own accord. I think when we sat down a couple months ago and talked about our North Star as a city, that that was a great exercise. It also felt like, you know, I'm going to date myself here, the Christmas catalog coming with all the toys and wish lists that were out there. Because I think I was the only one that mentioned the need for additional revenue and not looking at taxes, but looking outside the scope of what normal revenue is and just being creative on trying to find some. Because the wish list was long. And the wish list gets longer after some of the actions by the council over the last 11 months. So it'll be an interesting budget coming forward. But I mean, to Alder Schley's point is I haven't heard a large calling for reducing services. But those services also do come with a cost. So I think we're going to have to weigh that out when we get it in front of us because I don't think we can go in today and say that we want a 0% increase. Well, we could say it, but I think there's going to be a reality coming there on what it's going to look like. I think it's easy to say that we don't want to cut services, but there may be a reality coming where we start having to look at that. aspect of it and weigh them out on each merit on their own merits i think it's not easy just to say across the board i give you credit for the five percent reduction in in uh supplies you know it's a little hard to go across the board to make a cut because everybody uses things differently in departments but it's a goal and you have to start somewhere and i give you credit for that um because sometimes council sure doesn't make it easy so that's my two cents So any other discussion on directives to the mayor? Okay. Well, we're not going to take any action on that. Cut taxes and spend more. Got it.

Yep.

Finally have to do it. Okay. We'll take up this one at the end for meetings. So then the only other thing we have is right at the moment is closed session. Well, notice is hereby given that the above governmental body may adjourn into a closed session during the meeting as authorized by Section 19.851A of the Wisconsin Statute, which authorizes the governmental body to convene in a closed session for the purpose of deliberating concerning a case in which the governmental body which was subject to a judicial or quasi-jurisdictional trial or hearing before the governmental body. Specific subject matter that may be considered in closed session is 26-0694, one-year operator license application for E.U. Whatley, 26-0695, two-year operator license application for... You got the number wrong.

I think 95 is Whatley and 96. You started with 94.

Well, that's because that's what I have in front of me.

Okay.

So, all right. Well, I have 26-0695, 26-0696, and 26-097. So a motion could be in the closed session was made by Alderperson Reckleberg. Second. And second by Schley. All right. Sitcoats, aye. Reckleberg? Aye. Schley? Aye. Dunbar? Aye. Breyer? Aye. All right. We are in closed session. We are back from closed session and we have the three documents to take up. First one is 26-0695, one year operator license application for E. Whatley. Motion from the committee.

Alder Reckleberg. Recommend approval of the license pursuant to Wisconsin Stat 111.335. Second.

There's a motion to approve the license and a second. Discussion? Discussion? Seeing none, all those in favor? Aye. Aye. And opposed? Okay. Then we have 26-0696, two-year operator license application for M. Melchewski. Alder Reckleberg?

I recommend approval of the license pursuant to Wisconsin Stat 111.335.

There's a motion, is there a second? Second. Motion and a second. Discussion? Seeing none, all those in favor?

Aye.

And opposed? Okay, then we have 26-0697, one year operator license for Rays. Alder Reckleberg?

Recommend approval of the license pursuant to Wisconsin Stat 111.335.

There is a motion, is there a second? Second. Motion and a second. Discussion on the motion? Seeing none, all those in favor? Aye. And opposed? Okay, that passes as well. We do have one last item for this evening, and that is discussion on our next Finance Committee meeting because it does fall on Labor Day. summer is coming to an end so uh we did discuss at um personnel of moving it to the following day on tuesday um but we're open to if i know all the sly cannot make it that evening um that following would it be monday tuesday tuesday is the eighth yeah tuesday the eighth i can't make it Tuesday the 8th, you could not make it.

Wasn't there talk also Thursday the 10th?

There was talk about Thursday the 10th as well. That didn't go good? Not at personnel.

Nobody said anything about it other than the fact that then Tuesday was mentioned also, and we just went ahead with Tuesday.

Right now, let's schedule it for that Tuesday because that's the same day as Thursday. personnel but we'll take a look at the calendar to see if there's a better day that works in between now and then we do have a little bit of time before the notice would go out so but tentatively we schedule it for the 8th then i'd say there's always the tuesday before the first there's room tax so part of us would already be here for room tax from 4 30 to 5 30 we could do 5 30 the first as well with any luck we'll have a light agenda We'll see. We'll put it out to see what happens. Maybe there'll be no need for the meeting after all, but we'll find out. But we'll plan for the 8th, and then we can adjust from there.

So, okay. Motion to adjourn. Is there a second? Second.

All right, we are adjourned.

It was never up here, though. It was like on my legs. It just kept landing on my chin.

Wow.

He used to hang out with Micah. He's got enough to accept. So do you think you can ever remember Jim telling you who he contacted at the police department about getting temporary no parking signs for some of his members? I got a call from him back. Jim did this every single year for probably the last five years. I don't remember who he contacted.

law on the street on either side all the way up and quick trip went through that big remote and there was no place for their employees to park so the city came in and they just bagged the signs and they said you gotta let us know this we only do this for a year you gotta let us know a year so i put a tickler on my phone a month before that hit i went to get gas and i looked at all the signs

She lives on 21st Street. Staying all day. And she calls every year.