City Council - Special Meeting

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Brandon. I just sent it out. Good afternoon. It's Monday, May 4th, 2026, and we're at Carmel City Hall. I'd like to call this special meeting of the Carmel by the Sea City Council to order at 36 p.m. Thank you for your patience. We got started a little late today because of the Zoom link, but we're ready to go now. Uh, city clerk, would you please call the role? Sure. Council member Baron here. Council member Bter

here. Mayor Prom here. Council member Dram here. Mayor Burn here. All are present. Thank you. This meeting will be held in person via teleconference and the public is welcome to attend the meeting in person or remotely via Zoom or on the city's YouTube page. However, the meeting will proceed as normal, even if there are technical difficulties accessing Zoom. The city will do its best to resolve any technical issues as quickly as possible. Nova, would you please read the public comments information? Yes.

Um, the public may give comment at this meeting in person or use the Zoom teleconference module provided there is access to Zoom during the meeting. Zoom comments will be taken after the in-person comments. Um during special city council meetings, public comments are permitted on items listed on the agenda. After each item on the agenda is introduced, the mayor will invite public comment on that item. Each speaker has three minutes to speak unless otherwise adjusted by the mayor. While stating your name is optional, it helps to identify speakers and the meeting minutes. Remote or in-person participants who do not comply with the requirements of the Brown Act will be muted. Thank you. So, it's that time of year when we have a large number of items on the agenda as everybody's seen. It's appreciated if everyone could keep their comments tight. And if you agree with a previous speaker's comments, please indicate so to keep the meeting moving along. The council will be taking a 30-minut break at approximately 6:30 p.m., but it could be a little bit before or a little bit after that as as things progress. So, now we're going to move to the consent agenda. Items on the consent agenda are routine in nature and do not require individual action. I'll ask if any council member or member of the public wishes to pull any item for separate discussion. Any council people?

Yes, the minutes. Item number one. Okay, good. Any others? I'd like to pull item two uh for a comment only. How about anybody from the public? Would anybody like to pull one? Seeing none, I I'll look for a uh I move to approve the consent agenda items three and four. All right. Roll call, please. You need a second. Second. Roll call, please. That was quick. Council member Baron, yes. Council member Berter, yes. Mayor Prom Delves, yes. Council member Jama, yes. Mayor Burn, yes. Motion carries. All right, we'll go to item one. Jeff, do you have a comment on that?

No, I have a correction. Okay. Okay. Um, on page 16 of the packet, these are the city council regular meeting minutes from April 7th, 2026. And at the top of the page, it says page six of seven. So, presumably, that's the page of the minutes. And in the packet, it's on page 16. And there was a motion by me, council member Baron, directing staff to rem without language for your TOT measure. And the eyes list Baron and Bter, and do not list um, Delves and Dramov. And I would really like that to be corrected and brought back. Sure. So, can we just bring that back? Yeah, we we'll bring that back next time for for

Okay. Do you want to do that tomorrow or do you want to just uh uh Brian, can we bring it back tomorrow? Continue to a date certain tomorrow. Well, it wouldn't be on the agenda for tomorrow. But, um what we could do is continue this special meeting till tomorrow and we'll bring it back next month. Just max them out. That's fine. All right. Good catch, Jeff. Thanks.

Um, so on item two, I'd just like to commend Monterey Fire for achieving a 98% service level for under five minute response times. And there was only one call over five minutes for a code three, which is pretty outstanding. This includes five calls under two minute response time. And although it isn't a report, I heard that we achieved a a significant payment for AMR last month, which is good news. So, good job everybody. Outstanding service level from our fire department. That's all. So, I guess we need we can vote for item two. You want a motion? I'll move to approve item number two on the consent agenda. Second. All right. Roll call, please.

Council member Baron. Yes. Council member Berter. Yes. Mayor Prom Delves. Yes. Council member Dramoff. Yes. Mayor Burn. Yes. Motion carries.

All right. Now, we're moving to orders of business. These are agenda items that require city council discussion, debate, direction to staff, and or action. Item number five is Vista Lobos electric panel upgrade and EV charging stations. Resolution 2026-024. This is a resolution authorizing the city administrator to execute a contract with GA Technical Services, Inc. in the amount of $295,829 for the Vista Lobos electric panel upgrade and EV charging stations project for a total not to exceed amount of $350,000. I guess we'll be getting a staff report from Val,

good afternoon members. Uh Tom and I have been working together on this project since the beginning of the year to try and get it to completion. Um, it was started by Bob and Javier quite some time ago and we're excited to bring this agenda item to council. The lowest bidder is a company out of San Bernardino area and uh they have many years of experience with municipal electrical and fiber optics projects. Um, the proposal is totally in-house so they won't have any subs. uh they had references from the city of West Hollywood and the Brea Department of Transportation and San Bernardino Community College and they in particular the West Hollywood uh reference uh only had really good things to say about them that they they didn't nickel and dime and they completed projects and they complete projects that other contractors failed to complete. So, uh I also spoke with the the owner of the company and sounds like a relatively small project for them. So, uh, we are right now, uh, we pre-ordered some of the equipment to save some time because some of the the electrical equipment has like monthsl long lead times. And we did get an update that the last piece of equipment would arrive in September. So, uh, it puts it off a little bit longer than we hoped, but looks like it could, assuming that the council approves this contract, that we'd be able to be online and charging cars uh, by late fall.

All right. Good. Thank you. Okay. Do we have any questions from the council? We do. Thanks, mayor. Um, thanks for that presentation. I just have two quick questions. Um, do you know when the sunset center lot upgrade is going to be done? Cuz that was part of the original group and then it got pushed back a couple years. The upgrade, uh, can you clarify a panel upgrade or EV charging station? I believe it was both if I remember correctly. Yeah, we well actually Brandon, we had a conversation about this recently where we do have a preliminary plan in place, but it probably requires more explanation at a later date. Yeah.

Yeah. So, the the Sunset Center one is a little bit more nuanced um because we have to decide how the city wants to go down the road of either, you know, like when you buy solar panels for house, you can either pay for them all yourself and get all the rewards or you go uh or you go through a third party vendor and they do the setup and you don't make as much money. So, we need to have that conversation internally and bring that to council. And then it also dubtales in with potential work at the the retaining wall uh in that parking lot as well. So, we're not quite there at that point yet, but we wanted to get to this project up at Vista Lopus now. Okay. Thanks. And then my other question is, uh, just in case people don't know, um, how much does the city charge users, members of the public to be able to charge the electric vehicles at those lots?

Well, we had been historically charging less than what we pay for electricity, but so we moved it to be about the same. So, it's essentially the cost same cost as as it cost us. uh we can just set those charging prices. So I think when they're up online or closer to that time decide uh how we want to set those rates and you can also we should be able to set the rates depending on the user. So a user can have a particular code that they can put in. So maybe they're an employee or um you know a police car or something like that. They can charge at a different rate than the public.

Okay. So would that be something that comes back to us as a council at later date? Okay, thanks for that. Any other questions? I had just a quick clarification on the some of the numbers involved. So it looks like it's $295,000. Yeah. Um there was reference to like $200,000 of work from PG&E. Yeah. That P G is going to cover. But that's on top. That's just sort of separate, right?

That is separate. So they're that rule 29 they're going to there sort of two projects happening. One is the panel upgrade for the building and then adding a couple slower chargers onto that line. And then the other one that is the

the transformer upgrade that is is free through PG&. We signed a contract with them four years ago. That's the $200,000 that they're going to spend. uh and that and that is supposed to be for only EV charging. And so the another cost that you might want to understand in the bid is that also includes the price of the chargers themselves. And the level two chargers aren't too expensive, but the level three charger is pretty expensive. So I thought that there's there's like $150,000 rebate from Central Coast Community Energy. Yeah. Yeah.

And we've already spent $64,000 on this. So, um I I did the math and I was like, is it $216,000? I'm trying to figure out how much we're actually into it for net at the end of the day. Well, including what P Genies pay for? No. Okay. Including just what we spent so far on design. Well, there's 295 and then we're getting 150 back, right? Yeah. And then we already spent 64. So is it is it basically is the math basically 295US 150 plus the 64? Yes. Okay. So it's like a $215,000 project. Yeah.

Okay. Thank you. All right. Thank you. Anyone else? All right. We'll take it out to the public for comments, questions. Seeing none, we'll bring it back for discussion with the council. That's a good question. There's no hands raised on Zoom, but there's three people there. Okay, good. Somebody made it. Anybody have any discussion points? All right, we're looking for a motion. I'll make a motion to approve resolution 2026-024. I'll second. Roll call, please. Council member Baron.

Yes. Council member Bter, yes. Mayor Prom Delves, yes. Council member Jamal, yes. Mayor Burn, yes. Motion carries.

All right. Thank you. We're going to go to item six, janitorial services agreement resolution 2026-025. This item is a resolution authorizing the city administrator to award a janitorial services agreement with Bright Building Maintenance with an initial term of 5 years beginning in fiscal year 2026 to 27 with a base fee of 327,000 plus $6,000 supplemental services budget. And we have a staff report from Mr. Ford. Thank you. Good afternoon, Mr. Mayor, council members, and public. My name is Tom Ford. Uh wanted to start with some context on this. Our our current contract uh for our janitorial services is with Purerve. They've been with us for about a decade. Um servicing our facilities, our restrooms um and uh and their contract is ending. Um we had already extended it for uh 6 months um in the prior 6 months to allow us uh some time to go out and release a request for proposals. Um but essentially periodically we want to update uh you know give vendors the opportunity to to provide services in the competitive market. Um so after a 10-year time frame that that was time for that to happen. Um so staff had released the RFP our request for proposals in November of 2025 um for a 5-year base contract which would expire June 30th, 2031 with up to five possible one-year extensions. So, this presumably could be up to a 10-year contract. Uh, we received six six proposals. Uh, and over the course of about a half dozen meetings, we evaluated them based on their res, uh, relevant experience, um, local familiarity, technical understanding and approach, quality, completeness, uh, past performance. Uh, the two highest scoring firms were

Great Building Maintenance and, uh, Universal Building Services. Uh there's a chart in our in our uh uh staff report there um which lists the uh the bids that were submitted or the proposals that were submitted. Um these two companies were both in top two of the two of the top three least expensive firms. Now there is a price disparity between both of those two firms. Um 327,000 was Bright Building Maintenance. 222,000 uh was universal building services. Um after our our meetings they were relatively close but one thing had couple of things had had set uh break building maintenance apart to it ultimately leaded to us recommending um us to uh award the contract to them. They have local proximity. They're based in Selenus. um they have existing staffing levels that do not qu require additional hiring and many other of the companies did require additional hiring. There would be no lapse in service. They guaranteed us that. Um and we have found uh cleave and facilities and our our facilities division has historically found that a premium is placed on quick response capability whether it be you know weekends, busy holidays or what have you. But the ability to have a manager on call that's local and can get here that's not based in San Jose but that's based in Selenus is uh essentially the primary differentiating factor um among these two choices. Um and they would be able to start on July 1st. Um, so they would be start at the beginning of the upcoming fiscal year.

And that concludes my presentation on that. Thank you, Tom. Yes, sir. Any questions from the council? I had a had a quick question. Go ahead, Tom.

Um, you know, it is a it is a pretty significant gap. I mean, these were the top two firms and one's 327,000, one's 222. So, it's, you know, it's a $100,000 difference. Um, so you said the primary differentiating factor was was one being based in Selenus and sort of like how quickly they could respond. Are there other you know with $100,000 are there other ways that we could um you know manage that in a way if we went with the lower bidder to address some of those concerns. Um, you know, if the gap is wide enough that it just sort of makes me question. Yeah. Um, so that's that is one of the two biggest ones. The the other being that they would not have to hire anyone else. So that that's a large aspect. But getting to your your question, um this came right from our facilities manager Cleave when he had said that in his experience um in all his years here that was time and time again the companies that worked out well are the ones that were able to respond quickest. Um and uh I I think that is what led you know so so so of course the question has to be is that worth the difference in the price right we had to address that directly um and uh after you know after doing our due diligence and contacting everyone's references looking up you know whether there would be any lapse in services whether need be any hiring um rate building won out on that in staff's opinion at least Um, I kind of came at it from the opposite, which is I'm I'm glad we're not just knee-jerk taking the low bid. Um, I think we've suffered

from that time and time and time and time again when we have no choice. And in this this case, we seem to have some discretion. I think Hans's question is a good one. You what what do you get for the extra hundred? Um, but I trust that you guys did the analysis, you did the interviews, you did the fi the factchecking. Um, and that that's this is the right answer. Um, I also think that the status quo um is a very clear example of what we don't want. Um, and we have to do a lot better um going forward. I I can leave it at that. But a lot of my questions have kind of not much to do with this contract, but they're they're have everything to do with how we manage this contract.

Um, and you know, there's a very good precise um schedule of um when in particular the bathrooms, the public bathrooms uh get serviced. But this contract is for the public's benefit. It's all the public, not all the public buildings, most of our public buildings. Um, as well as the uh the public restrooms all over town. Um, and there's sort of a high high touch which are the ones in downtown and then ones that get touched less often which are um in Forest Hill Park. Um, today there are weekends where um it's it's really quite bad in in our bathrooms. And the qu the real question is who on staff knows that it's not good on a Saturday or Sunday or a holiday. Um and how will we manage this contractor? Um because I don't think trusting them to manage themselves is the way to go at it.

Yeah, great great points. Um Cleave Cleave is made well aware when um when complaints do come in. Uh they come in and they come in quite clear. Um despite uh you know we we our facilities division has uh made efforts time and again to to to resolve um you know issues that that have come up. Um so that that takes care of who do we even know? we do and we've um heard quite a bit of feedback in the past year in particular um uh Cleveland Leo had said that they are going to uh to answer the second part of your question Cleveland Leo had said that they were going to use um they inputed all of these parameters cleaning parameters and um I can't remember the name of the app that they use but they you use an app and we contacted this company and said would you be on board with it uh we are you able to to for your folks to to use this? Um they had said not only yes, but they're going to train their own people and they're going to come to our training of that. So we had offered to train them. They said they're going to train their own people and they're going to come prepared so that that like day one they already know it. It's that type of small detail that every time we had asked something they had at least presented that that they were on it. So they do have a tracking system. I can't remember the name of it.

No, I saw it in here. Okay. Yeah. Um Um Smart Smart Inspect. Smart Inspect. That's it. Yes. Um and and Tom, it's kind of not really a fair question for you since you're not in the uh business. I mean, you you ran the RFP. You're not in the in in the maintenance business. So, I guess it maybe it's just a statement, Brandon. We can do better. Um, and this and we agree and that's part of the reason we're selecting this partner because I think we we see them as a partner that wants to do better than what we've been doing and so we're excited about that. Thank you. I've got a com I've got a comment but I'll wait till after public comment for Yes. for mine. Thank you Tom.

Thank you. Public comment on this subject. Anybody online? All right, I'm going to bring it back for discussion. Um, great comment, Bob, and I agree 100% with everything you said and you too, Hans. Um, I think that, uh, we're in the process of implementing a reporting system. Correct. Is that premature to say?

We can say, yeah, I've been working with Joel, who sit in the back corner over there. Uh the city is working on developing an app like most larger cities have um called Go Carmel where it's a it's a mobile app and I have the beta on my phone right now. It's one of those ones where you click a button, submit a ticket and it goes into a system where all of us like 90 some% of our city employees have mobile phones. So it goes to a phone whoever it's been assigned to and you can you can tackle it via that way too. So we have some other things in the works right now to be able to respond to these types of things faster. So to Bob's point, we just have to make sure that when someone uses that app to report something that it goes to a person who can make something happen and that the vendor responds. So I think this vendor sounds like they're up for that. So that's a good thing. Anybody else have a comment? Go ahead.

I just wanted to say I appreciate Bob's comments and and certainly we we've heard the complaints through this past year. So we definitely have room for improvement. It sounds like we're heading in that direction. Good. Jeff, no comments. Comments. All right. I think we're ready for a motion.

Uh, I'll make a motion to adopt resolution 2026-025. I'll second it. All right. Roll call, please. Council member Baron. Yes. Council member Bter. Yes. Mayor Prom Delves, yes. Council member Drama, yes. Mayor Burn, yes. Motion carries.

And thank you for everyone that worked on that item. It's It's going to be good to move forward in the near future on that. All right, we're going to item seven. Moving right along, design traditions 1.5, residential design guidelines update. This is a continued item from April 7th. The council will receive an update on the design traditions 1.5 project and review the proposed plan, defined scope of work, and proposed timeline to finalize the residential design guidelines 1.5. Tom, you going to come back up?

All right. Keeping you busy, huh? I make a comment. Uh, just welcome. Welcome, Tom. I know this has been a new learning experience for you. Um, really appreciate your willingness to sort of step up and and manage all of us. Um to my fellow council members, I would note that number two is provide staff a wish list of specific items or issues the city council would like to see addressed. And we've been uh I I've been sort of looking forward to this opportunity for months and months and months. And I don't I only have really one or two things on the list, but I would encourage each of you if you have things that we need to consider um you know that the committee needs to consider in sort of getting uh this this document to the to the finish line. This is your opportunity to like put things out on the table and maybe for us to have a little bit of discussion about them. So this is it. Um this this is this is that. Thank you.

Thank you, Jeff.

Super. Um well, thank you. Um so today I'll be presenting uh our proposed plan, our timeline, our scope of work uh to finalize the residential design guidelines 1.5. Um uh today we're are seeking uh council's endorsement on the proposed plan to finish the residential guidelines so that the team tasked with getting this through the finish line can execute that plan. Uh some recent background, our city administrator, Brandon Swanson, had uh having been heavily involved in this project for the last number of years, uh he had presented this topic at several public meetings between council and planning commission. Um he had recaped past year's work and specifically asked the question of which draft version that we were going to move forward with. Um the overwhelming consensus is that the uh steering committee version would be uh um used moving forward as opposed to the Nory winter version. Um and most recently we presented this this very presentation uh that we're receiving today to the planning commission who uh this this past month who had um provided an uh excellent wish list so to speak. Uh but the task was to return to you uh today with a formalized plan and a strict deadline uh to get the project completed. To that end, our um council members uh Baron and Delves had had volunteered as project sponsors to ensure that this project stays on track. Um and uh and and acknowledging that that much of the the content direction is in in large part going to come from the planning commission uh among others, but the planning commission is primary end user. Um and ultimately the production team would execute the the direction that we are uh presenting today. So, who is the production team tasked with finishing the residential design guidelines? Um, on the screen we can see that it's comprised of a wide wide

variety of contributors. Uh, we have planning commission chair Michael Leage, vice chair Stephanie Lockach, Victoria Beach, Doug Schmidz, Ian Martin, Kevin Roose, Eric Dyer, several whom I've seen here today at least I think may be present. Um, we have our city administration, our city administrator. Um we have uh planning and building director Anna Janette um Jacob Olander planner and myself and uh and this is the team that is going to bring this through uh through the finish line. Um and our goal is to produce a useful adequate final version of the residential design guidelines. uh updating it to reflect some outdated information, add some new information such as fire resilience um that's somewhat recently come to the the forefront of our our sites. Um our target council adoption deadline uh that our group collectively decided on is September 1st. So we will be coming back September 1st confident that we have we will find a way to get there. We're going to get there. We're going to come back and uh uh that will be ready by September 1st. Um so today we'll be asking the question do you believe this is both an optimistic and a realistic timeline. Um before moving on I should note that the uh commercial and municipal guidelines um are on our radar to be addressed following the adoption of the residential uh design guidelines. But we wanted to get to our proposed uh timeline. Um our philosophy was to start with council adoption and work our way backwards. I'll explain the colors on the screen in a moment for folks, but for now I'll start by explaining kind of the meat of the plan. It it consists of four one-mon work cycles. So, starting this past month, April, May, June, and July. And we can we're going to walk walk through this past month's um uh work

cycle. And a benefit of having this item continued is that uh we get to see what what we've done this past month, what worked, what hasn't, what we need to pivot. So this is this is um ideal in in in my mind. Um well, we didn't actually end up okay. This meeting was pushed, but we uh uh we continued on. Um we presented to the planning commission. These are our purple um or our pink color. That's what that denotes. Uh where we saw an endorsement of the plan and requested specific input which we received both of those things. Um so at each month's planning commission meeting we'll get direction from them uh regarding which tasks we'll work on and we're going to bring back to them the following month the fruits of the work that we that we did uh following their meeting. Um planning commission meeting will also serve as the natural public forum uh public meeting platform where we'll seek ongoing feedback from the public and residents. Um we've heard from residents over numerous meetings over the years uh compiled them in a strategy paper and we feel that we have clear direction and and opinion from uh from residents. Now, in the two days following um planning commission meetings, staff will typically coordinate with our production team to ensure uh folks know the tasks that um they're going to be working on. And then comes our green segment. This is where the production team um works on editing the document uh per each of our respective tasks that we've divvied out. um during during the green period that that's when we we have our document open for uh suggested edits and track changes. Um so that's you know something that we need to maintain throughout the the the entirety of these cycles.

Uh the blue second is when staff uh namely uh Anna Janette, Jacob Olander, and myself um will review these suggested edits that were made during the prior week. Um accept those that are click, you know, cut and dry um and ensure that they reflect the direction that we received from the planning commission. Um towards the end of the blue period is when staff touches base with the ad hoc council sponsors and ensure that the changes we're accepting are aligned with what the planning commission had recommended. Um, so we were able to do that. We've had two meetings actually with with our uh with our sponsors. Um um so one other one other thing that we're going to do with the council sponsors is ensure that our language is consistent with how the uh California Coastal Act will review our document at the end. So that that will be something that we address with our uh council sponsors as well. And once we accept any edits comes our full production team meeting uh that will review the newest version of the draft that incorporated uh certain suggested edits and in that meeting to address areas where there are differing opinions and then work on the document together sitting down around the table and getting through it. Um, so the this is a you can look at this as kind of a template of how we're going to meet. We did have very strict days for the green period and the and uh and the beginning of the blue period, but really the the yellow date, the production team date, that's whenever we're able to meet prior to the following planning commission meeting. So we actually have our next meeting uh Wednesday of this week.

Then the cycle repeats. So effectively each planning commission meeting will serve as the beginning point of each of our work cycles. Um, and an important note regarding the planning commission is that they'll also serve as the kind of the de facto body that will review our our um the latest changes or excerpts of the changes that we've made each month to ensure that we're we're on the right track. It's kind of just a summary of our of our of our process. planning commission meeting, suggested edits, we review and approve, and then we have a production team meeting uh where we show the approved changes and we discuss things that that we need to work on together. We make those changes, we go back to the planning commission. So, that's that's the uh that's the idea there. Um this was provided in the staff report. I I don't need to go through every single one of these, but we had we had uh written out a um rather extensive scope of work uh tasks to complete. Uh many of which we started this past month, a couple of which we started this past month. Um but you know, we're not going to address we're not going to address every task each month. Um we're we made the intention to to parse out these across the four cycles. We actually really frontloaded cycle one. We didn't get to everything in cycle one. So, I I I don't particularly look at that as uh some type of failure of our group or anything. We gave ourselves a ton of to-dos and we got a lot of them done. Uh many of which were the the wishes of the planning commission. So, that that um I think is a win. Uh and now we are seeking feedback uh on this plan. Um, specifically the two questions on the screen. Uh, do you

endorse our the proposed plan or scope of work or timeline to finish the uh, residential design guidelines? And we're asking for a, uh, wish list of specific items or issues as council member Baron had suggested. And that concludes the presentation. Yes, sir. Thank you, Tom. Any questions from the council? Go ahead, Bob.

It's not a question. And this is really wearing my ad hoc hat if if you indulge me. Um thank you Tom. Um I think uh Steve, but the just to share because we didn't do this a month ago. A month ago we were asking permission. Now we're sort of asking forgiveness because we just kept going um with the effort. Um and this is and I'll have more to say on this later, but this is an effort that has never been done before. This is a very unique project um in that regard. And um therefore what we thought we were going to do a month ago has already changed. It's already morphed. And that was we we've had to be that way. We we have to have some flexibility uh to adjust as we go. Um uh in the first round I think we had a lot of um really good editing um uh that was done in particular by city staff um on the document and I think that has given us a lot of uh a lot to react to when we get the the production group together on Wednesday. Um, and uh, I think we've concluded that for that production group, um, it really what we're just going to have to do is kind of roll up our sleeves and go through this thing a point at a time um, chapter by chapter and that the approach um, over the next 6 months may may be more that we do there's essentially six chapters um, in this thing and that maybe we do one maybe two chapters a month. We'll know on by the by this time on Wednesday. I think we'll have a pretty good idea of um you know of how well our current thinking holds up. Thanks. Thank you, Allesandra.

No questions, Hans. I think I have more of a comment. I'll I'll hold it. Jeff, right, let's go to the public for your thoughts. Victoria,

hi there. I just wanted to echo what Bob was just saying about remaining flexible. And I would argue that for your consideration that we have another model available to you all, which is the model you all debated, I think in February, I'm not sure. I think it was beginning of March. Um that was the extremely effective and speedy blitz model that we followed. Um just as a observer I just want to build on both what what Bob and um Tom said that there were I think a number of delays and backsliding on this particular cycle and it still remains to be seen whether we can pull out of that and I so appreciate the flexibility but I just want to offer for your consideration that there may be another model here that we have proven effective. Thanks. Thanks. Anyone else? Anybody online?

Um, there's no hands raised online.

Thank you. All right, we'll bring it back for uh deliberation. Anybody want to kick it off? Go ahead, Bob. So, yeah, I'm a I'm a councilman and an ad hoc and a former planning commissioner, so I have a lot of thoughts on this. Um I I I think I will take um uh Victoria's thoughts. So the in my opinion there we we did have the the an alternative model that was available to us um prior to us creating the ad hoc there was a period of time where um the production team uh uh got together and made good progress um on the document and I think it was that progress that we all reacted favorably to. Um I think an important thing to remember is that progress was primarily um in two um uh regards. One was uh the photographs um that especially Ian Martin worked on. Ton of progress there. I think we finally found the right photographs to portray the right uh examples of of what we're trying to say. Um and then I think the other place where we made the most progress was more in some preamble uh language on fire um some introductory topics um etc. Um where I don't think we did make progress uh was in advancing and certainly in vetting the content. Um, and I think that's still the elephant in the room here is we've made a ton of progress on agreeing what the format of this thing is, um, of of making it more usable via photographs and maybe with some transitional wording, but we have not had a

meaningful conversation that includes the planning commission staff um, us um, on the con the the the content of this document. And I think we have to be cleareyed that um the the plan the steering committee product um is a reorganization of the Nory winter 1.5 document and I was speaking in some code here for people that don't understand that but um uh the Nory winter 1.5 document being a a an update of our you know 25 year old design guidelines that Nory Winter did 25 years ago and we hired him to come in and update them. Um, and he produced a product and that product um, uh, was essentially a redline version of his previous 25-year-old product. So when you looked at the Nory winter what we call 1.5 version 1.5 um it uh he tracked the changes so I knew I could tell you what had changed from that original version. So what updates had he made to the document from 25 years ago. Um at a point in time some years ago um our steering committee um of that um of that project was unsatisfied with the work of Mr. Winter. Um Mr. Winter's ter services were I won't say terminated. His project was deemed over. Um and uh the steering committee took on their own effort of uh continuing to work on our design guidelines. Um and they did so um first by reorganizing the Nory winter 1.5 document um from one organizational theme to another. We're not going to go into that. We've had a

lot of debate about it. I think that's settled. Um um but uh what I also have come to understand even more clearly in the last month is that it was not only reorganized, it was rewritten. um almost every paragraph has had some change to it. Um and unfortunately um a decision was made to not track changes to not produce a red line. Um and I don't want to harp on that, but I I just want to share with the public and especially with my colleagues that that's a very difficult starting point. Um, and I I and that's really why I was motivated a month ago to create an ad hoc um on this because I didn't think with all due respect to Victoria that um that that Blitz approach was going to really thoroughly vet um the content especially the revised content because the fact is because there's no red line I don't know what has been added. I don't know what has been deleted. I don't really know what has been changed unless I can look at one document to the other, back and forth, back and forth. And because it's been reorganized, that's very difficult. Um, we do have one document uh that's helpful. Um, it was prepared by Mel um Albornne uh who's a planning commissioner. Um, and that was really sort of an effort at at a Rosetta Stone, if you will, to um, map the paragraphs from the Nory Winter 1.5 version um, into the steering committee's version. It's helpful. It's directionally correct. It's not it's it doesn't even approach a red line um, of of being able to track changes, right?

So, um, um, and we've been talking about this as a group. Um we we still have a lot of work to do to just try and figure out what's changed here and that's going to take some time. Um um so so I do believe going forward we do need a different approach um and we have to we have to address that. Um secondly, um and despite you know lots of public meetings and process, um I don't think the voice of the user community has been adequately represented to date. Um and the user community is first and foremost our staff, our planning staff. Um they work with this document every single day. Um, I'm really glad that Jake and Anna um had an opportunity to um edit the the steering committee document. Um, they did a lot of editing um, and that's going to be part of what we're going to be talking about starting on Wednesday. But I I feel like that voice was finally heard um and included. Um, the second piece of that is planning commission. Um, same deal. I think the planning commission has been asked about organization of the document two or three times. It's been a long time since they were asked about what they wanted to see in it. Um we did get some good stuff out of them last time in terms of specific things they want to see. I think we've already started um working on that. Um but again in terms of the actual content and trying to figure out let let them decide ultimately on what changes to accept and what not to accept. Um I'm looking forward to that. The third piece that has been lacking other other than um significant contribution from um Eric Dyer um is the architect community

uh because they they use this thing all the time as well and um they're they've been silent. I' I've reached out to Eric in particular to make sure that his colleagues know that this thing has changed and if they want to have a voice, they need to bring it bring it now. Um so um in in terms of things that I would like to see, that's kind of it. I'm I'm not here to espouse any particular um thing that I would like to see other than just making sure that the that that that this end product has really been vetted and we really know what um what has changed. I think that's it.

Thank you. Um, Hans, would you like to go? Um, are we do I think that was sort of as I recall getting out of Weren't we doing questions? No, cuz we haven't public comment, right? Well, we haven't done public comment yet. We just we didn't get it right. Oh, that's it. Yeah. Okay. This is this is it. Okay. This is your chance.

Well, um I want to begin by thanking the steering committee. um you know I've been involved on a an effort like this where we took two years and a lot of volunteer effort um which I think it's hard to appreciate like exactly how much effort can go into that kind of process and this was 3 years and 30 plus meetings and so you know thank you for all of that effort. Um I want to break my comments I guess into process and substance. So on um the process side um so Bob I agree with you. I think a red line would be really helpful for us to be able to I mean gen sort of generally speaking on any project like this. a red line's really important and we've had you know just sort of as a a staff discussion point even on the aha situation we've had sort of like technical issues with red lines and I wonder if that's you know it's not an insurmountable barrier and I think there's probably something that we should devote some time to just have maybe having some policies around or figuring out what some best practices are there um but I do think it's possible for us to probably go back and create a red line like we have tools tools, we have AI, you know, we can hire a contractor. Like, it's not it's not a crazy enormous document. So, um that that might be worth it. Um I agree with you, Bob, that including the voice of the end user is really important here. I'm glad you mentioned the architects, too, because they're they've got sort of an iterative look at this. They see it all the time, just like the staff does. um you know on staff I think if the staff is looking at this thing I think it's about clarity it's about what's unclear

what's missing what insights do they have based on what they typically see um I'm less interested in I'm actually actively uh would discourage sort of weighing in on specific like sort of policy decisions I really feel like that is where we need to see public input, the planning commission and the council. Um, so you know, I don't know. I I sort of hear things. My my understanding is that staff did sort of a full content review was also trying to add some of the things that the planning commission had mentioned in their last meeting. But you know at least one interpretation you know that I had heard was that some of the changes veered more into the territory of substantive really policy um oriented changes and so um you know that that concerns me a little bit and so just something you know for you guys to kind of keep your eyes on. I'm really glad that we have the two of you working on this. Um I think you're the right people to do it. And then the last one is, you know, I checked in a little bit with Tom offline about um kind of the progress on the action items list. I know there's a few things both in terms of staff and volunteers that didn't get done over the past month. And so I just encourage all of us to, you know, foster that accountability of like, hey, we said we've created a project plan. We've devoted these resources to it. um you know, let's have the accountability to make sure that the stuff happens. And then on the substance side, um you know, again, I'm I'm pretty willing like this thing has already had 30 plus public meetings and um I'm sure it'll have more and the planning commission is going to weigh in on it. But I'll highlight just a couple areas that and there, you know, Jeeoff, you kind of queued it up like this is this is our moment to talk

about these things, right? So, I'll give you my laundry list of of items. Um, I've mentioned this before, but the document uh it's actually I think was in the original document uh before this review, but it mentions that I think it's 2.5.1. I don't know if that's changed, but design without a fence or wall along a street frontage. Um, and like the one thing about this town, like if I think about it, maybe coming from the east coast, is like every property has a fence, right? And so I think it I think it kind of undermines the um validity uh the strength of design guidelines. If there's a design guideline that like everyone kind of winks and nods like, well, nobody actually does that, right? So that's just a a thought. Um the there's you know one of the things I think we want to try to do is it's hard but to make things as clear as possible. So 4.2.1 to avoid uniformity in the appearance of speculative development and to promote individual artistic expression differentiate a new building's plan massing and overall design from that of nearby and abuing buildings. totally love the impulse. I think it's really important. We want to have a bespoke organic look to the architecture of the town. I would encourage us to see is there some way we can nail down like what does nearby mean so that you know if somebody has a Spanish style house like and I'm thinking about buying a house and I go and talk to somebody at the staff you know and I've had these kinds of conversations before like when we bought our house um can I build a Spanish style house here? I want somebody to be able to give me a a you know some kind of answer that they feel good about. Um and and so I don't know if that's possible,

but it's just something to to look into. I think that one will actually come up a fair amount. Um there's a small one about um 5.3.4. And again, I give you all the caveats that there was like 30 public meetings and I was not participating in those and decisions are made by those who show up. So I will give you that caveat, but use a low building plate height, generally not over 8 ft. And my only thought was if there's a building that it's not going to impact someone else's view, etc., it's a one-story building and if they want a ninetory plate height, like it, you know, it doesn't it doesn't, you know, take any skin off my back. So, and then the the biggest one for me is just the um and and you all are working on this anyway, but the um the update in terms of fire and and principally it's like materials. So when I look at section 4.1 through 4.4 um there's one section 4.1.1 says reuse existing buildings and their components for example restoring rather than replacing original windows. We know from a fire perspective that dualpane tempered glass windows are an important factor for home hardening. And so I don't know. I I would I'd rather have us lean into give us some great guidelines to make sure that those windows look as good as possible. Um and that they look like they're not some window that's out of character, but let's allow us to at least, you know, protect ourselves. Um

what section was that?

I think it's 4.1.1. um 4.3 um use traditional natural building materials. Um you know there's a section in here I guess it's sorry it's 4.4.2 says um do not use petroleumbased architectural elements and you know look people have different opinions on this. I think the idea here is, hey, Carmemell can be um a leader in this space and if anybody's going to do it, Carmemell is the one to do it. And I I get that. I think the challenge for me is that we're in this tough spot where we're also dealing with this new world of fire issues and we are on 4,000 foot lots and we're in the middle of a forest and it's just tough. And so it's kind of like something has to give. Um, you know, right now 2/3 when you look at the fire inspections, 2/3 of homes have a composite roof. So, we have this sense that every home in Carmemell has a wood roof. It's actually like 2/3 composite roofs, which is a petroleum product. Um, I'm not saying I love it, but it's just something we need to dig into more. And then similarly, we're going to have these zone zero regulations about fences, um, and return fences, which is like where the fence connects to your house. And so I mean people have different opinions on this but if we there's going to be a requirement that that is a non-combustible material from the state guaranteed within like 3 years. And so if we don't want to have a bunch of metal fences connecting to houses, which to me like probably isn't the look of the town, we need to have some flexibility I think here in terms of materials. Like if you could give me a grape steak, a faux grape steak that

looked like a grape steak, like the cedar shingles for the roofs and that's petroleum based or that's I would go for that, you know, and I probably like be pretty interested in that. Um, so yeah, there's just there's just a few of these in in this section um that you know, do not use manufactured materials that fake or mimic natural or other materials in their textures or finishes, including machine stamp faux wood grains. Again, um, you know, those cedar shingles, and it's ce dur. It's a brand. It's like a faux woodshake shingle. They look fantastic. they look like wood shakes. So, it's sort of like you can preserve some of that look um you know with the fire protection. So, um I had been holding this list back in the previous times that we talked about this topic um because I really wanted to focus on the process, but Jeeoff, if this is our last moment to talk about it, there's your list. Thanks. Trouble with this. Thanks, Hans. That was great. Very well done. Alisandre, your turn.

Thank you, mayor. Um, first of all, I echo Hans's comments about um thanking the volunteers who took part um in the steering committee and came to the meetings. Um, it's a lot of dedication and devotion to the project. Um, I have a little bit of concerns with, um, I'm not sure if the plan is realistic. Um it feels like we've added a lot of bureaucracy to it. Um it feels a bit rigid and I think it does need a little bit more flexibility and I'm a little concerned about the timeline because it looks like if one day is missed where somebody can't make a meeting it might throw everything off like it just it feels rigid. So that would be my uh little bit of hesitation there. Um as far as specifics though um I share a lot of what Hans just brought up and and it was very thorough. Um certainly the fire safety issue um expanding the materials uh for houses and for landscaping uh different building materials and I have concern over the use of wood in both houses and landscaping. Um the fences also as Hans just brought up the wood picket fences that we tend to use. Um landscaping if we could get some ideas and examples especially with the fire safety as well. Um, and then with the ADUs, um, I know, uh, we don't want to use photos of somebody who did an ADU that the community doesn't like cuz we don't want to single people out, but if we could maybe do a sketch so that it's not completely identifying, but we could uh, show examples of good ADUs and ones that are not so good and and certainly the placement on the lots and and we want them to be subdued. We want the same architectural features as the house. um same style the way and setbacks that sort of thing. So if we could just give some examples um with sketches that kind of thing so people get a better idea of what we're looking for. Um but I certainly appreciate the work of the ad hoc and once again as I

said appreciate the work of the steering committee um and all the volunteers that have taken part through the years. Thank you Jeffrey. Are you going to make any further comments? Yeah. Okay. Go ahead. Yes. Thank you Dale.

Go ahead. Um, thank you uh, Hans and Alisandre for your comments. That's what I've been uh, looking for, what I think we've been looking for. And I don't want to say that um I I do I don't want to say that you know there's always another chance to to make comments like I I truly think I really think that but it really helps us it really helps the project to have these things out on the table at the beginning so that we can uh figure out how to incorporate them whether and then how to incorporate them into the into the document and put them through the sort of the amount of review which which we hope is a lot to make sure that we don't sort of screw it um as we get to the end. So, I'm I'm very appreciative. I only have before I make my before I respond mostly to Hans and Alisandra, I only have a couple of things that are on my wish list um which I'll just say them to get them into the record. Um my my primary uh my primary concern is with um properties that undergo small small changes after small changes after small changes and they're consistently in in uh to use our vernacular they're consistently track one projects and you know they undergo three or four or five track one projects and and now we have a a property that looks substantially different um than what would have been allowed had it been attracted two project because every track one design element, every track one design process starts with what the house looked like, what the property looked like at the beginning of this application. And I would really like to see and this may not be related to the guidelines, but more to the the municipal code that's uh that's going to be that will wrap the guidelines. I really like to to see some way for some number of exterior changes to sort of trigger some form of a track to design to make sure we don't we don't use these successive small incremental changes to

sort of veer away from what we think Carmemell should look like. So that is the my most important um that's the only comment I'll make in terms of the in terms of the the the content. Um the other thing which I have talked about before is I would really like to see, you know, once um the committee is done, I would really like to see the city spend a few thousand or $10,000 and hire an editor to make it uh to make the document look professional. I think it's, you know, the last document represented the city for 20 years. And if we if we're going to get, you know, 10 or 20 years out of this document, I think it would I think it would really reflect well on the city to have it have a maybe a more polished look um than what uh staff might be and I certainly don't mean any any offense to to Tom and Jake and Anna, but what staff might be able to provide. I think that sort of professional look um would would really sort of enhance the sort of uptake and the reputation of the city. Um a couple of comments. Um, you know, I'll go back to I I'll take these in reverse order. Allesandre mentioned that timeline timeline feels rigid and I agree with that. Um, I think that Tom Tom spoke at the beginning about us trying to be flexible. Um, I think that a lot of the rigidity and I I certainly do not want to put words into your mouth. I think that a lot of the rigidity to me that the schedule seems to um schedule seems to imply is due to the fact that we've tried to uh create a schedule that revolves around the planning commission meetings. Um and we've tried to figure out how to do the various stages of how to do the work in various stages to um to sort of accommodate you know the that primary user of our of our document. I think Tom Tom talked about this a little bit when when when he was up and and we've sort of changed our tack a little bit about, you know, we've had sort of a

problem getting sort of planning commission focus on the entire document. So he talked about these meetings that that we're having like we're having one on Wednesday where we're going to talk about a specific section of the document in a lot more detail rather than doing the whole thing at once. So we are trying to be flexible and trying to adapt trying to adapt um to adapt to schedule somewhat so that we can get so that we can get through um get through all these things. Um so I appreciate your uh your your concern. Um Hans and I disagree differ a little bit I think on on staff's opinion on on wanting staff's opinion and I think the advantage that we you know I think advantage that I feel that we have from including staff is we you know staff is the staff is the organism inside the city that has the knowledge of what the sort of built environment looks like. And a a conversation I know that that Bob and I have all the time is trying to uh trying to um guide the document to represent some sort of middle ground between the built environment and and an aspirational environment like what do we want Carmel to look like and what does Carmemell currently look like. Um we don't want to you know this is a 1.5 version not a two version. We don't want to upset people, upset the architecture community and and the homeowners, the property owners community too too much. So, we're trying to figure out um you know, we're trying to sort of understand sort of where we are in terms of that understanding. And I think that staff brings uh staff brings the knowledge of hundreds and hundreds of hundreds of projects um to the ta to the table. something that I uh I certainly don't know, you know, five or six projects a month on stuff that I I don't know. And I think also to to a to a good extent, you know, my

interactions with staff so far have been that staff really represents um um while not a direct voice sort of an indirect voice of what the needs of the planning commission are in terms of how the planning commission has expressed their you know their views on particular subjects. Um, it's really difficult, you know, we can't we can't really, you know, we have two planning commissioners on on this sort of group, but it's difficult to capture the sort of the spirit of of a lot of planning commission comments that have happened over the course of years and years and years without um without sort of going back to staff and getting staff's view of, oh, you know, that was a problem a year and a half ago. Um because you know while the planning commission sees projects for you know while the planning commission sees projects for um you know you know two hours at a time over the course of a couple of hearings you know the time that the project is in front of the planning commission. I think that staff really sees the nuts and bolts of the project as the project is being constructed and I think that they are they are very aware um they are very aware of sort of the the the picadillos of of our current of our our current documents and and stuff like that. So I I do value um I do value um their opinions on sort of what what has worked and and what has not worked. Um I'll I'll close by saying um again thank you. I'll close you know I'll close by saying we have uh in in the slides there's a scope of work um the task list and and I think Bob and I sort of compliment each other. I think Bob is very concerned um and and you know put words in Bob's mouth. Bob has expressed a lot of concern with sort of this the scope of the you know the the words inside the

document like are do the do these words get us to good outcomes and I'm really concerned with um the scope of work sort of the the the project the project manager sort of stuff making sure we figure out what to do like Bob spoke about the red line making sure that we figure out what to do about the red line because I think that's going to be a very very difficult task trying to understand what the with the coastal commission and with us to be to be frank and the planning commission to be frank to try and understand what the differences are between two documents that are completely differently formatted uh from one another. I think that's a herculean task and I I don't think that um kind of our standard uh our standard um methods will will really get that. I'm I'm concerned about the additional documents. You know, there's been a lot of chatter about making the process easy for, you know, for for property owners and architects to sort of navigate. And so there are a lot of, you know, you'll see planning plot, you'll see in the scope of work, planning process, flowchart, and description. I'm concerned about producing good good versions of those documents as well, so we don't have a rebellion um once we adopt these things. I'm concerned about, as I've spoken already, about the MUN code. So I think uh Bob and I, you know, really sort of compliment each other and we're both looking at slightly different the project from slightly different angles. And again, I'd like to thank uh thank thank Jake and Tom and Anna for their work and Victoria and all the members of the committee. Um the people that the people that show up and do the work um and and the five of you for having trust in us.

Thank you.

Thank you. I'd like to thank everybody who's been participating in this for the last few years and and recently and the two council members that are on the ad hoc committee. I appreciate all your time you're putting into it. Um I'm not going to repeat I think there were a lot of good things said and I I think I agree with most of what was said. So I'm not going to repeat that. But I've heard a common theme something I I made a I think a big point of at the last meeting was we really need some help. And I'm looking at you Brandon when I say this because it's not just this group. we really need some expertise on document management and I think you know that uh we should invest some money and and if we can't train somebody on staff to just have somebody on call that has a great amount of expertise because we really need to do both online and printed documents and this document looks more like a printed document the links you know it's just going to be completely different especially in a world of AI the document management part needs to be designed so it can leverage the technology that's coming out and the the red lines just fall out of that. So, we really need to do that because we have what 30 documents to do and we've got two that we've spent years on and we just can't move at that speed anymore. So, uh and I heard that from several of you if not all of you. So, that's good. Um there are some fence components now that I think sort of like roof components. I think somebody showed me a a like grape steak that looks like a grape steak only it's Yeah. So you should be happy about that. Um, and I think it would be good if we have because the ideas are going to keep flowing, including for me, as we get into the document, especially as you come up with the next release probably. There needs to be a really clear way as part of document management of how how we can give you those ideas without having it be too cumbersome and lots of emails and

Well, let me ask you a question. Um, if I if I may. Go ahead. Um, it's difficult for it's difficult to sort of manage that process without like I don't know how like I haven't I haven't really thought about it, but I don't know how to really manage that process given the Brown Act. So, you can't you can't be sending us things. I don't know. Um, we'll have to work on whether you can communicate with staff and have, you know, put a wish list in through staff, but we'll see. Um, you know, look at Brian when you're saying this. I'm trying to not look at Brian while I'm saying this. Um, we'll see if we can we'll we'll work on it.

Yeah, it's not just me. I'm talking anybody really. Well, anybody details that count.

I would I would emphasize, you know, it's a lot easier to make changes now in the process than it is later. So, it's a lot easier this month than it's going to be next month. It's, you know, incrementally more difficult every month that goes by. Um, you can certainly um you can certainly email uh Bob and I with with your your thoughts or your feelings about what we need to produce and we'll either we'll we'll take them to the group and may or may not carry the water depending on whether we like the idea, but we will certainly take them to the group. Um, you're also of course always welcome to email uh Tom Ford, the project manager, and and Jake and Anna, our planning staff members. So, so those lines of communication are always open, but again, I would ask, you know, sooner rather than later if there's something

I would guess that Jake might come up with a way easy way for a place for people to send those to.

I think you're you've got some probably creative ideas on that. Anyway, um I think it's time to move on. Do you think you have all the direction you need? Tom's got a thumbs up. All right. I think it was very well done by everybody. Thank you so much. to be continued as quickly as possible is what I get. I think the schedule's challenging, but I like challenging schedules, so I'm I'm all for it. Thank you everybody. All right, unless anybody has anything else to say, I'm going to move on to item eight. All right, fiscal year 2026-27, city council discretionary grant funding. Item eight is consideration of fiscal year 2026 to 27 city council discretionary grant funding and direction on distribution of grant awards. And we get Nova. What a treat.

Good afternoon, Mayor.

Try that again. Okay. Good afternoon, Mayor and Council. Um this item before you is um to go over the grants grant applications we received for this upcoming fiscal year. So why are we here? Um I'm going to just briefly summarize the the policy that we have that was adopted about 10 years ago. Um, I'm going to quickly review the applications that were received and the staff recommendation for funding. And then, um, what I need from council at the end is to provide direction regarding the total amount of grant funding, um, for the upcoming budget and then how much to distribute to each of the grant applicants. So, the council discretionary grant policy was adopted in 2017. Um and that that's what gives direction um on how we do the application process, how we review them, how how they're awarded. Um some of the eligibility criteria is that the nonprofit or it must be a nonprofit or a Carmel school that must be either located in Carmel or at least serve the residents of Carmel. um they must directly provide the services that they're receive that they're requesting grant funding for. Um they must have no outstanding debt to the city and they must not be financially dependent on the city for the grant. So the grant policy was included as one of the attachments in the packet. So I I won't go over it in detail, but basically because it's a discretionary grant policy, it's the council's discretion whether to continue to do it from year to year. Um we already accepted applications for this year, so we need to review the applications we

received and receive direction on those. Um but we might want to think about what to do for future years. Um, if awarded, each recipient must sign a grant agreement just confirming that they're going to use the funds for what for what purpose they were approved for, and they must use it within the fiscal year. Um, grant checks would be distributed in July or August after they signed the agreement. So, just to summarize quickly, um, the grant application period was open for almost two months. Um, we did a lot of outreach on the website, Instagram, Friday letter, the pine cone, email list. Um, we received 18 applications. Um, everybody requested the maximum amount you can request, which is $3,000 for a total of $54,000. This is similar to last year. We got 19 applications and a similar total amount was requested. Then um staff reviewed the applications and found them all to be eligible. Um this is just a list of the applications that we received. Um the details about what they requested the funding for is in the packet so I won't go over that in detail. Um so we're looking for direction from council on the total amount to allocate and then how much to distribute to each grant applicant. Um, I think I'm missing a slide in here. Um, and also to I wanted to ask for direction on whether or not you want to agendaize a future discuss discussion on the grant policy and what to do for next year's budget. Um, so it somehow didn't end up in my slides, but um, the total

amount that um, staff is recommending for the grant allocation was $20,000. And since there were 18 applications, we're recommending $1,000 for each applicant. And then that would leave um a little bit of wiggle room, like a buffer of $2,000 so that in case we get a random request later this year, which tends to happen sometimes, we'll have a little bit of um leeway to grant one of those. Um so if council has any questions, I'd be happy to answer them. Anybody have questions?

Questions? Go ahead, Jeff. Questions? Go ahead. Um you say in here that each recipient must sign a grant agreement confirming the funds will be used only for the approved purpose. Do we go back and check on previous years like some of the some of the organizations that have that are on this list are continued from last year? Do we know that they like lived up to what they said they were going to do last year? So they're supposed to send in um at the end of the year a summary of of what they used the funds for. I would have to double check to make sure that everybody last year did that. Um,

so I don't I don't have that answer right now, but I believe most if not all did follow through with that last part. So last year being the 24 25 year or the the 20 or the 25 26 25 26 which we're getting ready to Yeah. So, in this list that last so the list that we approved last year, you've received some forms from uh some

Yeah, but they they still have until um and this is where there's kind of some overlap. They have until June 30th to spend it. So, not everybody has submitted their hey, this is what we spent it on. Here's the receipts or a picture of of how we used it. I don't have all of that yet because they still have time to spend the money that they got last year. is uh second question is $20,000 the amount that's in the budget for this program and it's been $30,000 in the past, right?

Yeah. And I wanted I mean I wanted to highlight that because it you know it's credit to NOVA all of our department heads this year and putting the budget together. We were all tasked I tasked everybody with looking at what they oversaw. So this was Nova's recommendation coming to us uh to Marissa and I and Jamie to look at this and go from the typical $3,000 each grant to $1,000 each. So, um, yes, this is what we put in our bar draft budget. So, if this changes, then we would need to modify that during the workshop. Okay, Jeeoff, I might add, have going back a couple years when I was part of some of this, they do ping you a couple times to make sure that you turn in the uh report. So, it does happen. Yeah, I remember.

Excellent. Thank you. Any other questions? Well done. Thanks. Thank you. All right. Um, public comment.

Hello.

Good afternoon, Mr. Mayor and Council. My name is Maya Lynn and I'm the president of Carmel Lock Trial and I'm joined by Lily Sunvic, our vice president. We submitted a grant application for our trip to Chicago in November for the World Championships. Chicago is a really important time for our team because that's the point where we get to bond with so many other teams, not only from other teams in California, but other teams in different states and even teams outside of the country. I still have friends that I've made throughout the years at this experience from Ireland or even Korea. And this is such an important part of the mock trial experience because we get to experience in such a real way what being a lawyer or an actor or even a clerk or baiff is all about. And it helps us decide really what we want to do with our career and helps us create the connections to get to that point. And it's really helpful um for creating those connections for internships. Several judges of the competitions often offer us internships or reach out to supply aid in our journey into the field of law which is why this is part of an important part of the mock trial program and Mayia's going to talk about the effect that it has on our team personally. So, one of the most important parts of mock trial is the teamwork. During our competition trials, we're not allowed to talk to our coaches. We're all on our own. And especially towards the start of the season, which is when Empire Chicago takes place, it's important that we build that rapport and the team dynamic that supports us for the rest of the season. In Chicago, we spend approximately a week with only the team where with each other rehearsing material. We're spending two entire days in competition trial. It provides the

foundation for our success for the rest of the season and our team wouldn't be the same without it. Thank you. Thank you. Very impressive public comment. Thanks, Nancy. Anybody else have something to say? Michelle, I think you had your hand up.

Hello everyone. Thank you for this opportunity. Um I'm representing Leadership Carmel. Uh we are 2026. There are nine of us for this year. Um professional development program um dedicated to um designed to provide a solid framework to inspire and serve current and future leaders and influencers. A legacy project is a as a gift for the Carmela community. Um our passions for this year are youth, music, and the outdoors. And we wanted to build um for the discretionary grant we applied um to build a harmony habitat harmony habitat a sculptural outdoor music garden at Forest Hill Park. Um we are trying to fund raise $30,000 to bring Harmony Habitat to life. Um and there are these whimsical musical instruments. Um, and we are advocating for our youth to be our as excellent and equitable citizens. They're our priority one. They're our future. And we want to ensure that um they connect with nature and enjoy the the the arts of Carmel and such as the music of the instruments that we're um trying to build at the park, Forest Hill Park. Um, thank you for your time.

Thank you, Michelle. Just come on up. Good afternoon, Mr. Mayor, council members. I'm Bill Shrier. I'm the coach of the Carmel High School Mont Trial Team. And this wasn't by design. We're not doing the primacy and recency thing, which I teach the students, but uh just worked out that way. It's It's been about a decade since Carmel Montreal first came to the city council seeking funding for our first ever trip to the World Championships in New York City. And I notice that it was 2017 when this program started to get organized. It was pretty much ad hoc at the beginning. Um that was necessitated by the fact that Carmel Unifi does not pay for students to travel out of state despite the abundance of resources in the district. The council stepped up then and has done so whenever we have asked. I don't have the exact figures, but in a decade, your contribution to the mock trial program has been significant. And what has that support meant? Well, I could go through the list of accomplishments, but suffice it to say that our program has an international reputation as an elite academic team. It is not uncommon for a colleague to tell me that they have been in another state for training, mentioned they were from Carmel, and were told, "You have a great mock trial team." Indeed, if someone in California, Florida, New York, Illinois, Massachusetts, Korea, Ireland knows anything about Carmel High School, it's that we have a great mocktra program. But our program is also respected nationwide for its civility and service. Every time we go on the road, we perform a public service project. We've cleaned up Central Park in New York City and Magnolia Park in Chicago. We've worked in food banks from Santa Ana to Santa Cruz. We have sorted clothing for the homeless in Sacramento. And we have served dinner at Glide Memorial Church and Project Open Hands in San Francisco.

So, we don't just do well in mocktra. We do good in the community, too. I've had many coaches say to me that our program is the envy of the state because of how far-reaching it is. Furthermore, many of our former students have gone on to law school or on a pre-law track in college. To a person, they count their time in our program as an important part of wanting to practice law. Without your assistance, none of this would have happened. We're asking the city council for the maximum contribution of 3,000 so we can return to Chicago and the world championships. We won it in 2016 and we have finished in the top 10 every year we have competed. But our need is acute this year. Inflation due to the war in Iran has increased travel costs significantly. But this year for the first time, Cardinal Unified has also told us they will not pay for coaches travel either. So we're going to need to raise a few thousand more for the trip. Estimated cost for 12 students and two coaches is about $30,000. We thank you for any support you can provide.

Thank you. Thank you for your effort with the uh with the mock trial and congratulations on your success. Thank you. It's fantastic. Anyone else? One more. Anybody else want to talk? Do we have anybody online? Nova, there's no hands raised online. All right. Hi.

Hello, city council. My name is Leah Beats and I'm the new executive director of the Carmel Heritage Society and I just wanted to take a minute to introduce myself and um thank you for the consideration of the grant that will help us preserve and bring awareness to the history and the um architecture and the uniqueness of Carmel. Um so I just wanted to say thank you. work and you we're grateful to continue to work with the city council and that we're excited to focus this year for our house tour on women in the history of architecture. So, our theme this year of our house tour is um designing women. So, it's focusing on women architects, um women designers, and women builders. So, I just wanted to say introduce myself and say thank you.

Congratulations on your new role. Yes. And it's hard to believe it's already time for the house tour, right? I remember last year I was standing out in front of my house and there was a stream of people going over to Edgemeir and I had the best time. Yeah. Yeah. Yeah. If you go there again, I'm looking forward to it, but probably not. All right, good luck with your program this year. Thank you. Thank you so much. Thanks. All right, I think that's it. All right, let's bring it back for discussion. Who wants to kick it off? Bob, go ahead.

Uh, yeah, I would agree. I I would say we should do a thousand each as um uh Nova has recommended and we should throw two more in for the mock trial because it's a great program and they showed up and I'm not going to be Scrooge and say we should stop funding nonprofits even though I think we should. Well, I said it.

Oh, no. Well, you didn't really have to, Bob. Um All right. Uh Aleandre, why don't you go next? Thank you, mayor. Um, I agree with Bob about um well, first of all, I want to thank Nova um for um making this work with with um a reduced budget and and really with budget season, everyone really has done a good job in cutting back spending. And so I appreciate um her effort and u making it fair. Um, so 18 uh groups at $1,000 each with $18,000. Um, I I still think in a way it would be good to keep that 2,000 in case somebody else does apply uh a bit later. Um, I I'm open if we want to have a future discussion on this item. Um, I know it's a wonderful thing that we do as a city, but on the other hand, if we're also trying to um be very budget conscious, it might be something um we may not be able to continue in the future. Um but anyway, so I'm fine with the way NOVA has um broken it down and I certainly appreciate all the groups that did apply and um thank you for that.

So to be clear, you're you're saying basically do what NOVA had recommended. Correct. Nothing with the mock trail, right?

Okay, Hansen. Um, so my my first comment is um, you know, this isn't a lot of money and I've been on the I've been until recently, you know, had a nonprofit arm to my operation where we're asking for grants generally a lot bigger than this, but still even in that scenario, it's just um, sometimes you feel like you're doing more work than than what you're getting back. And this is for $1,000 is definitely one of those scenarios. So, I would just encourage us to make it as nonburdensome as possible in terms of the application process. And yeah, there's got to be followup, but you know, let's let's really aim on the side of keeping it reasonable. Um, uh, I, you know, I would support Bob. I mean, I think honestly the the mock trial team is an elite team. As Bill said, it it um really represents uh you know, Carmel well and I um I think that it's something that that we should support. Um you know, they really do an amazing job and Bill kind of pours his heart into it and um Bill, you were a former assistant US attorney, right? Yeah. So, I mean, it's really just incredible talent and effort that he pours into this. So, um I would support Bob on that. All right, Jeff. Thank you. Um, you know, I I I really like this program. I I wish you know, Bob and Alessandra, I hear your comments about Well, your comments about Yeah, I won't repeat them because you didn't want to say them in the first place. Um, I wish this program had a larger budget. I wish we were back at $30,000. Um, so I'll say that. when I look at the list, you know, back when we started it was a bunch of little organizations.

Um, and I think if you're running um, like, you know, sober grad night, I think if you're running an organization like that, um, that does small community-based events, you know, a,000 or 2,000 or $3,000 is a lot of money and has a significant effect on sort of this the the success of these events or or whether Sober Grad Night really even happens. Um, and I wish that we, you know, I wish that we could more support organizations like that that that are small in scale and really community focused. Um, I would, you know, I'll put this out. I would like to see, you know, some more money allocated to, uh, the organizations like that. And perhaps, you know, if everyone agrees, we could use revenues of these organizations, you know, as sort of a basic yard stick to decide um who who who gets the the extra money and who doesn't. Um for this year, I I would support a conversation as as I heard Alisandre support about what the what the goals of this program are. Um you know, I don't I know we hear from Stephen Moore a lot. I'm not sure that Packreup Theater is really the target. Um, and I don't mean to use him use Packrep as a kicking board, but I don't think that Packreup Theater is really the target of a program like this. You know, PACREP puts on, you know, hundreds of performances a year. and and the scale of that organization is significantly different than the mock trial team or um the sober the sober night team or the caramel heritage society who we heard from. And I think that those are the organizations that we really I think these small community organizations are the organizations that we really uh we

really should be supporting. And so I would like to see if there's a way we can spread a little more love to organizations like that this year without excluding everybody else. And then uh maybe review the parameters by which we grant this money next year. Um and see if we can we see if we can start uh honing in our focus on organizations like that. Thank you. Great points. Great points. I'm gonna I'm gonna have a comment. How come this I'm gonna have a comment, but how many of you are in favor of of having a policy discussion at a council meeting?

All right. So So that I think you can mark that down as as some of your feedback. Um were you in favor of of giving the mock trial Bob's proposal? Well, I think I think, you know, I would I would support that. I would hate and I think uh I do welcome. It's really awesome uh that the three of you showed up. I can't I can't express enough um um I to all the organizations that showed up um that cared enough and and and and showed up to to uh to ask for your money. I can't I can't express enough how much that means um that you took the time out of your days and and and organized it. So yes, I would support that. You know, I would say that

well maybe these three organizations are it. I don't know what the uh I don't know. Yeah. So yes. Okay, good.

So I I was thinking when I when I was noodling this around at home the last couple days that maybe it would give us more flexibility because I know some things come in and they have come in in the last year with good causes just like you discussed Jeff. you know, that that type of thing. Um, of maybe we make the instead of making it 18k total, making it 25k total. At this point, we're going to use 20 of that. So, that leaves 5,000 for for other things that come up for the next 12 months until we have this again. I'm going to throw that out there. Well, maybe we can go around and see what you think. Um, by the way, the sober grad night is is 60 60k. It's not a it's not a cheap thing to put on, but it's also a very very valuable uh endeavor. So, uh that's I I agree with the 2K. I think that was a great proposal you made, Bob. And uh and thank you for showing up. I don't I don't know how you could not be impressed by those statements and and the whole program. It's wonderful. So, uh anybody have any interest in doing the 25K, which leads 5K instead of at this point nothing?

Yeah, I I have a comment. Um I obviously would be of interest to that. Um thank you for your clarification on sober grad night. But I would you know um

the caramel Heritage Society showed up too and I know that they I know that they are perennially in search of money and and staff and and money and staff and the wherewithal and all that. And now we have now we have a representative here from them. And so I think uh I would say if you're going to um if we're going to uh extend the amount of money to 25K um perhaps a little bit of love could be uh sent to the Carmel Heritage Society as well. you started. Could I just add? You can't.

It's not going to be popular, but I just feel we shouldn't be picking and choosing favorites because they're all worthy groups. And so I think it's fairer to just leave it at 1,000 each. And certainly some of these groups might start a GoFundMe or something like that where they could get that extra community um contributions to um you know, for example, that the money that the mock trial team needs to make it to Chicago. So something like that where there they have other ways that they could raise money. I just think we should keep it fair and and not pick and choose winners and losers or favorites in in the whole process.

The end of my comment was going to be looking at Brandon and Nova that maybe there's some way using Friday letter some of our city communications to put out those as a summary to this like here's what these people are trying to do. I don't know how you do it, but maybe we could help with that and and just getting the word out to because we have a lot of people that would love to help. Go ahead, Hans. I'm sorry. Yeah. No, I I sort of have this um this concern every year and I'm going to play Bob for a minute, which is uh

you know, we have a lot of pretty big things to talk about like um deferred maintenance and tax measures and the budget. And I just wonder like we're talking about $2,000 $5,000 here. we just spent less time than this talking about a $300,000 contract. Like I just wonder how much time we should be investing in like getting this perfect. Um so just just something to keep in mind. Yeah, makes sense.

Consensus. Anybody have an interest in making it having 5K in the bank at this point? No. I'll make a motion to um fund um all 18 organizations at $1,000 each as proposed by the city clerk with an additional $2,000 totaling three um for the mock trial. Okay. Second. Right. Any further discussion? Just to clarify that leaves zero for any other Yes. Okay. All right. Okay.

So, so there's no uh there's no $25,000. There's no room later in the budget for So, just to be clear, if some if another high school group comes up and wants money, and I'm just bringing that up in there. if another high school group comes up and wants money, you know, at some point during the fiscal year, which seems to happen every fiscal year, and we're we're pretty generous, the count, we're just not going to entertain that. That's not part of my motion.

There's no So, there's no money for There's no money then for uh staff to come back to us as part of this as part of this program.

Not with that motion. I would I would make an al I would make an alternate mo a substitute motion that we follow Bob's uh we follow Bob's prescription um with the addition of the $5,000 $5,000 extra reserve so that we would have a mechanism for uh dealing with easy easy ass later in the fiscal year. I'll second that. Rev on that one first. Yeah, you have to take Well, I'm going to do your job for a second. You have to take action on the the substitute motion first. Was there a second? Yes. Yeah. Yeah. I made a second.

Just to clarify, Brian, even though I have my own motion on the table, can I vote for his? Yes. All right. Guide us to a solution here, Brian. So, so the matter you'd be voting on would be the substitute motion first and then if the substitute motion passes then there would be no need for a vote on the original motion. All right. And if it fails, then you would need to vote on the original motion. All right. So, we we have a first we have a motion and a second. And it looks like we have some support. So, I guess we should go for a vote. Oh, you're just voting on one at a time. We're doing a substitute. So, you start with a substitute motion. We're going to vote on the substitute. Roll call. Okay. Council member Baron.

Yes. Council member Bter. Yes. Mayor Prom Dels. Yes. Council member Drama. Yes. Mayor Burn. Yes. Motion carries. Congratulations to everybody who got a grant. Appreciate your participation in the program. Mr. Mayor, before we go to the next item, could we take maybe a fiveminute bathroom break? Um, I think that would be a great idea. Thank you. All right. We're going to take five minutes, maybe a little more. We'll see you back here soon. Lots of good comments, too.

We need Nova. We're ready. Okay, we're on item nine, transactions and use tax measure 375% increase. Item nine is a discussion of a draft resolution ordering the submission to voters at the November 3rd, 2026 general municipal election of a measure to increase the transactions and use tax rate by 375%. Bringing the total rate to 1.875% and extending the duration of the tax so that it remains in effect until ended by

voters. We are here for discussion and direction. Mr. Mayor, I'd like to, if I could, could I just do a quick sort of overview, uh, brief comment before we get started? Of course.

Thank you. Um, so, as you probably have noticed, you have two items tonight back toback. We were talking about this one first, but both of them, uh, relate to tax measures. Uh, you certainly, Brian will tell you this today. Uh, you don't have to take action today. In fact, you can't because we're just really here to discuss. Um, but the tax measures that we have, both the toot and the sales tax are meant to be an ongoing dialogue about tax revenues and measures throughout the budget season that we're in right now. Uh, it's important as we work through the budget this month and next month to be aware of these potentially revenue generating tax measures. Uh, as you've heard us say throughout the budget meetings, revenue is one of the levers that the council can pull. And a way to pull a lever on tax revenue is through a ballot measure. Just as a reminder, uh we will be having another revenue conversation coming back to you in June related to uh parking management through paid parking. Uh that will also play into your conversation about the levers of revenue. Um, and I also want to just say that uh when we were putting this item on the agenda, if you remember last time, the council asked for staff to bring an expert to share with you the wisdom, potential downfalls, um, any challenges with putting two ballot measures on the same ballot in the city of Carmel by the Sea. Uh, we did reach out to four separate experts. All of them said the common wisdom is that every ballot measure you put on in addition to one does make it more complicated. That's a common wisdom. However, they did say that each community is very different. For example, several of them use this uh Santa Cruz as an example. Place like Santa Cruz that has a college, a large population of young voters, you could put four ballot measures on to raise a tax and it has a lot higher chance of passing than it does in a place that doesn't have a college. Uh so they said in fact they none of them would come to a city council meeting and pretend to

offer an expert opinion to the five of you as to what the outcome or challenges might be for your residents. In fact they all said the people that were best positioned to understand what the residents would feel about two ballot measures were. In fact the five of you uh myself as the city administrator and our assistant city administrator. So among the five of you, you're really best positioned to understand what the pros and cons are of putting two ballot measures and the appetite of your residents. The only way to be unequivocally sure would be to run a polling measure, like actual community-based scientific survey that a company would come in and do polling. Um, so that that is in your quiver of of options that you have as well. Uh, so I just want to put all that out there because once again, we're navigating through the budget season. We're talking about revenue. We're talking about those levers. you can pull these two ta tax measures could be part of that. Uh but tonight is meant to be an ongoing conversation. So we're looking for uh feedback on the approach. We're looking for feedback on the language. We're looking for feedback on one ballot measure versus two. Uh we're looking for feedback on the percentages. Anything that you want to offer feedback on, we will continue to modify these as we go through uh the process. And Brian, I'm sure, is going to talk about when you ultimately would have to adopt a resolution sending these into the ballot. Uh so thank you for letting me go for that. I thought it was important to have that structural overview of the two two measures. So, thank you, Brian.

Thank you. May I have proceeded, mayor? You may.

So, we're going to start with the um as you mentioned in your comments, the transaction and use tax. Um by way of background, the city's current transaction use tax is 1.5%. And the way that that has been structured is that it would remain in effect um for 20 years from 2020. So, that'll be in effect until uh 2040. And pursuant to the direction of council at your meeting in April, um council's being requested to discuss the draft ordinance and resolution um which are in the packet and which would submit to the voters a ballot measure that would increase the I'm going to call this the TUT tax to stand for trans transaction and use tax by 375%. So then that would bring the total tax to 1.875%. This would require an approval by a majority of the voters. Uh next slide please. This is a ballot question. I'm going to read uh the entire question because this is critical because this is what will be seen uh by the voters if you vote to um present the ballot measure. So the question shall the measure funding the city of Carmel by the seas general government purposes such as for example infrastructure improvement, public safety and other general municipal purposes. increasing the I'll call TUT tax rate by.375%. So that the total tax rate is 1.875%. Extending the duration of such tax so that it remains in effect until ended by voters. Remember my earlier comment about the current one is to expire in 2040. And the 1.875% 875% providing approximately 9,437,887. So that's the total amount um of the revenue that would be derived from the 1.875%. Um be adopted. So that's the question

they would need to answer. There would be on their ballot a yes or a no uh to that question. Next uh slide please. So the votes required under proposition 218 um since this would be a general tax um uh first of all in terms of the vote by the council uh the law requires that it be 2/3 and with a member with a five member council that means four affirmative votes uh would have to approve the um resolution to put this ballot measure before the voters and then as I mentioned in my prior comment the ballot measure um would then proceed to a vote of the electorate and it would require a majority vote, simple majority of 50 plus one and that the next general election is on November 3rd, 2026. Next slide, please. So, in order to submit the measure to the voters, the council would need to adopt the resolution and just um by way of summary of that resolution, it would submit the measure to the voters with an ordinance increasing the rate by 375%. it would request the consolidation of that um ballot measure um with the municipal election on November 3rd uh statewide. And thirdly, it would authorize the drafting of the primary arguments by all or some council members um directing the city attorney to draft an impartial analysis of the measure and then authorizing rebuttal arguments. Uh next slide. Um, this is a question that uh comes up from time to time and uh when you're dealing with ballot measures, it's important to kind of forecast that. Now, obviously, if the me if the council would vote to um approve the measure to go onto the ballot, we'll spend even more time on it. But for our purposes today, I will say that that once the measure is certified to appear on a particular election ballot, the city is prohibited from spending any city resources to support or oppose the

ballot measure. The city can provide information to the public in a neutral and unbiased manner and in a format that is not argumentative. This involves utilization of the city's standard methods of communication. Next slide. So this is the uh ordinance. Um I've have it here in a red line so you can see what the changes are. Um the uh ordinance would be attached to the resolution itself. Um if it's going to be presented per your direction. Um and if you give that direction today um when it comes back to you, it would be a clean version of the ordinance. But um this is for you and the public to see um what that change would be. And um I'm not going to read every word on this slide, but the basic point here is that the um the tax would remain uh in effect. Um uh it says for a period of 20 years that has been stricken from this section. Next slide. Um here we have that change in the 1 and a.5% to the 1.875% 875% um striking the 20-year u u effective date and replacing it with the words and remaining in effect until repealed by the voters of the city um of Carmel by the sea. Next slide. Uh similar to the previous slide um this provides for the excise tax um to be at a rate of 1.875% increasing it from the current 1.5. um striking the words about the limitation to a 20-year period and including the words of remaining in effect until repealed by the voters of the city of Carmel by the sea. Uh next slide. And then the final uh amendment to your code would be the one you see here. Um once again striking the language about the 20-year limitation and saying it remains in effect until repealed by the voters. So, um that repeal by the voters

would be again by a simple majority vote. So, 50% plus one if the voters ever wanted to um end the sales tax and the TUT tax. All right, next slide. Uh so, here's an election timeline. Um I'm not going to read to you from the entire slide, but as you can see, we're uh today talking about the draft resolution. um uh if you if you give direction um uh it'll come back to you at your meeting in June. Um there would be a deadline for adoption in July. So if for whatever reason in if you give direction tonight to bring it back in June for adoption and there were still some questions um there would still be uh a time period uh to allow for further uh conversation on it. Then the public engagement would be during the July to October period. Um and then in uh August would be the um that would be the period where the primary ballots are being um ballot arguments are being submitted. I would be providing an impartial analysis of the measure uh as well and then the election day is November 3rd. Next slide. So the recommendation is to discuss the attached draft resolution and the ordinance that would increase the TUT tax by.375 to a total of 1.875. 9875 and then um a motion um to provide direction to staff regarding whether or not um the draft resolution should be presented to you at your meeting on June 2nd and further whether to submit the draft ordinance to the California Department of Tax and Fee Administration for review. Um that's something that we would recommend in case they see something in the ordinance that they would have a question about because they're the ones that administer the tax. Uh next slide. Well, that's um all I have to say on my opening comments. Um I can respond to questions.

Thank you. Somebody want to kick it off? Sure. Alisandra, go ahead.

Thank you, Mayor. Um I have two questions. The first is for Brian and I believe the second is probably for Brandon. So, um I believe I read in the agenda packet um that if this does pass, it becomes effective 10 days after the November 3rd election. Is that correct? because usually it feels like most of these things take effect on January 1st of the following year. So I just wanted to confirm that. Well, the resolution itself would take effect immediately. The ordinance would take effect. I don't know where I don't recall seeing the 10 days. Um it would be adopted on November if it's adopted by the voters the adoption date would be November 3rd. I I'll need to get back to you on on the effective date. I the 10 days is not ringing a bell, but it may be in there. And I

I read it somewhere, but I just wanted to confirm that because it seemed unusual. Um I'll still go to my second question. Um Brandon, so assuming this passes, um we are looking at um it would make $1,887,417. So we were looking at half that amount or is that the amount for this shortened condensed for an that's the annual amount. So whenever the ballot measure became effective, you would just use the math to so if it became, you know, six months into the year, you get half of that. Split about that. Okay. Just wanted to confirm. Thank you. Yep.

Jeff, thank you. Um Brian, your staff report uses the term of art certified to appear. Um what does that mean? That means when it's been submitted to the county and it's been approved for inclusion in the ballot measure.

So if we approved it like your your last chance date is July 7th. So if we approved it at that meeting, not the June meeting but on the July 7th date, certified to appear means July 8th or 9th or some point right after July 7th or on July 7th. My my advice would be that um once you vote to if you vote to uh u approve the resolution to submit it to the county that we use that as as day one as your starting point and not spend any public funds at that time.

And second question is I know that you talk about this in the staff report but I was hoping for a couple more words from your report. Um submit the draft ordinance to the California Department of Tax and Fee Administration for review. Yes. So, that's something that we would do like we could do that tonight. Yes. And then we'd get a we'd get a um a verdict back from them before the June meeting. That's the hope. Yes.

That's the hope. But Okay. And they'll tell us. So that's like a like a little insurance policy on we haven't missed we haven't missed a number in our municipal code or Exactly. It it's an opportunity since the state is the one that administers the tax um it is our practice to submit these um uh modifications by the ordinance to the state to have them reviewed and that's our recommendation. Okay. Thank you, Hans. Brian, I had a a question here. Um, can we put the language of the ballot measure back up, Nova?

So, the ballot question that would be the ballot question. Yeah.

Mhm. Yeah. So, what struck me about this was the the language of the question makes it sound like we're raising $9.4 million of net new revenue. And I think those kinds of these kinds of subtle T's and language things in in um in these kinds of ballot questions I think matter. Um, and so I would very much prefer if there was a way to make it the 1.9 million. And my question is sort of my assumption when I was reviewing this, and you can tell me if I'm wrong, was that the total was listed because you're removing the sunset provision on the entire sales tax. Um, and so my question was, is there a way to structure this so that we could just list the incremental revenue? Uh the answer is that we've listed the total amount for the very reason you said is that you uh as presented if it remains in effect until ended by the voters that would be an increase in the tax um that you currently have because that tax ends in 2040. But for example, if we said that this tax ended in 2040 and the previous sales tax already ends in 2040, could we list the 1.9 million?

Yes. Okay. I'll tell you what, that's that's a tenative yes. I'd have to review it, but I mean, just sitting here that I I can tell you that the logic that went into drafting of this ballot question was based upon the assumption that it was going to be a tax that would be remaining in effect until ended by the voters, which be a modification of your existing code. Um, I'll get back to you with a 100% answer on that one um at your next meeting if we're going to have a next meeting on it, but um my understanding is that uh that's the reason why you see the 9 million instead of the 1.9 million.

Brian, perhaps one thing you could look into also is there a way to write it so that it breaks out the two so that the 375 increase was representative of 1.9 million. The existing tax is representative of however much that is. There's a limitation on the words uh on the word count of um I think it's 75. Um but I'd have to check it. Um if that is the will of the council, I could see if we could maybe change a few of these words to to get that in there. Well, I guess I'll wait for my comments.

Um I did have the same exact question as Hans for the same reasons. Um the other question is if we don't put this on the ballot in November, when is our next chance to have it on the ballot?

Well, there is a problem in that. Um there's uh if the county were to um or one of the other countywide agencies were to um adopt a measure well to present a measure and it gets adopted by the voters um there might not be an increment that's available. And so I'll follow that's a third question, but the still my first question is I'll say it. If we decide not to do this or some other tax in November, when is the next chance to have a tax increase of some sort on a ballot? I believe it would be two years from November. So there's no there's no off-year opportunities. Not that I'm aware of, but I'll put that on my list of questions. But

we'll need to look into that because I believe Monterey is doing a June. That's why I'm asking special election for sales tax. I'm not sure if it makes a difference if they're a charter city or not. No, we did our we did in fact did measure C also in on the primary date in 2020 which was I think it was in March um that year. So we uh right at the beginning of the pandemic we my my memory on that one is that there was some kind of an emergency declaration that went in to that and there I I I I can certainly if if there's a need to drill down into what happened in 2020 we can do that but I do have a recollection that's something to do with a declaration of an emergency.

But we'll get you your answer on when the soonest is we could come whether that's a special election or if we have to write wait for the regular election. Thank you. And then the third question, Brian, you teed it up, is I understand that this 375 is available because right now it's TAM's money and there's a cap and I mean you can maybe explain that a little bit better, but the real question is, you know, it's the use it or lose it question. Um that if we don't put this on this ballot, the theory is that somebody else can. And I I don't understand what that means. Can Can some other agency

Well, what tell me what they Yeah. Not another city, but um the county um or the there's other um taxing agencies um u within the county could uh um present a ballot measure that would um use could say use up the the increment. So I think that that's so for example if if MST Monterey Selenish Transit decided to do that and they put something on the ballot that would be countywide and that it would be a countywide vote. So even if the residents of Carmel don't support it would still go into effect if it's a majority vote by the within the county.

Yes, that's my understanding. Um the other taxing agencies that that are within the county would be the Monterey Selenus MST Special Transit District and the Monterey Transportation Safety Transportation and Use Tax

I guess. So that if you maybe that's just another one to clarify that because I my real that my question is can one of those agencies have a countywide election um and um as long as the majority of voters in the county agree to it it applies to every municipality or do they have to win every municipality by majority vote within each municipality? I I believe the answer is it's a majority vote of of the county voters, but I can I'll look at that. Thank you. All right. Anybody else have a question? I saw you pushing the button there.

Well, I think it's I think it's worthwhile. Jeff, do you want to ask your your questions? I think they're good questions. Um I So So I was going to wait until So I asked my questions. Okay. And I was gonna wait until after public comment. Let's go ahead to have I got some answers from Brian and I was going to ask uh I was going to wait. I'm at the same place. So let's go public comment now. Good evening. Good evening.

Earth to Yes. Good evening. Thank you all for what you do. Nancy Tumi here. Um, just question on my own personal behalf. Um, when we get to the point where you're actually submitting the packages to the county uh for ballot use, uh, who crafts the rebuttal wording and how is that? What's the process for that? Can anybody craft rebuttal wording, etc.? So, I have no familiarity with that, but I suppose I could look it up online. So, that's one question. Um, and then I think the other was really kind of digging into the path that Bob was going, which is to really make sure that as this information is communicated broadly to the community that we understand the use it or lose it implications and what all that means because I got a whole lot of questions on that in the last week. um because I was confused myself uh about how that works and and also the clarity that is now available that uh specifies that this is an incremental local sales tax increase uh because there was confusion based upon last month's session but this is clearer now. So that's that's great. Thank you very much.

Thank you Nancy. Anybody else? Anybody online? There's no hands raised online. All right. All right. Let's uh have our discussion. Jeff, you want to start off? Sure. Go ahead.

Um I did ask uh I did have the opportunity this afternoon after my meeting with Brandon to ask uh Brian about um a a couple of questions. Um the first was who are the possible players in gobbling up the 375% of sales tax margin that the city has has remaining? Um basically uh school districts are not so there's no chance of getting of having CUSD coming through or any other school district um coming through and taking the 375%. Um, the only Brian sent me a list of Brian sent me a list of what seems like a comprehensive list of all the transaction use taxes in the state, but there's a there's a section of it from counter from Monterey County. And basically in our area, it's MST. So, it's MST. There's a there's another um there's another safety transportation and use tax. Um the the thing lists an Monterey a Monterey County an unincorporated Monterey County um TUT. Um but it's not clear that that applies to us. So it's basically our undoing and MST. So, I'm not sure um I'm not sure, Brian, given what you sent me, whether or not Monterey County actually has the ability to even come in here and and levy a tax. Now, that I'm sitt here sitting here and explaining it to Hans. My understanding is that they can do that. Um it would apply if the city had not um already used its um tax increment. So, if you were not, that's like the use it or lose it concept. if the county should increase um have a successful ballot measure that that

would um mean that they've gobbled up the increment that the city would have been able to to get if you had put on a ballot measure that was passed by the Carmel voters.

The the second question Thank you. Um the second question was what happens if someone else comes in and takes it? So if there's another agency comes in and takes it and I was hoping for the answer that I didn't get which was that um the second agency would be prohibited from coming in but the answer is the first agency that takes it gets it. So if MST we're looking at my MST rep or MST rep if MSD were to come in and raise their tax from 0.125% is that what it is now to half a percent for example that's that that's not like that's not going to happen. Um we would be unable to we would be unable to get that 38 of a percentage back. And the the correlary to that question, Hans, was what happens if Monterey passes their sales tax and um

PG and MST comes in and wants half a percent. And Monterey has already at the cap. Um and Brian's answer to me was that um MST would collect the tax anywhere, everywhere except Monterey. So that was not the answer. I was hoping for uh a different answer, but the answer is in that case, in the case of Monterey, like Monterey got there first and and so Monterey gets the tax and MST would levy their tax everywhere else in the county. Um, and then the correlary the correlary the correlary to the corlary cor corlary to that was what happens if MST and Carmemell both put a sales tax measure on the ballot at the same time and they both pass and the answer to that is um that that outcome is unknown. Um there are it's a it's a known unknown. There are directions in the materials that Brian sent me that direct the franchise and tax board to the attorney general for an opinion as to what exactly would happen if a situation like that arose.

Those are fantastic questions. Thank you for So those are that's the answer to that. Just some color as your MST representative. I think the good news is the MST board would have to approve it. The MST board is made up of representatives from all the cities and one representative from the county. So, it's probably not going to happen in the short term that

Yeah. As the old representative to the board when uh before we swapped and these sort of sales tax disc these MST tax discussions have been sort of happening in the background. I assume since you've been on it, they've been they're still happening sort of in the background about doing polling. um you know before MST adopted the tax um some number of years ago there was a significant amount of polling and whatnot that they did and they adopted the tax um it was.125% they needed 66% I think um they got they did all this polling and they got 67%. So they were right on the money. So the I think honestly the chances of them getting more than an eighth more than the 0.125 are probably pretty small. So they my guess is they would be really reluctant to have a measure on the ballot that said we're going to go from an eighth to a quart. We're going to raise taxes to fund um to fund transportation.

You like would you like to summarize your thinking then of where where your head's at with this? I uh I I would summarize my thinking by saying I think we should do one of the two things. Um I have conflicting things running around in my head as to which what either the sale either the sale like I'm going to call it the sales tax. Um either the sales tax or the toot rather um my feeling feeling is like we should do one of them. Um and only one of them. I'm somewhat wedded to that somewhat wedded to that idea. I agree with uh I agree with the statements that I've heard that I heard Brandon say from the consultants and from just a couple of constituents about um that having two me two tax measures on the ballot seems um odd and I would hate to have people um I would hate to have people guess and and make you know have half the people make one guess and half the people make the other guess. Um, I'm not 100% wedded to that idea. Um, my thinking right now is I would prefer to see the toot. Like I'm a little bit I'm a little bit skeptical um about acting based on fear and I think that acting based on I think acting based on um the fear that someone else is going to come collect you know our money I think that's generally a bad way to um to operate in general like fear-based operation is is bad um but I'm not um I'm I'm more set in stone in the my opposition to two ballot measures than I am in the choice in the choice of ballot measures. I do

think um I do think as since I have the floor that this um you know we have a we have a sort of you know I I would I would thank the council for agendaizing this back in February you know after I after I talked about it and getting started getting started early. So I'm I'm very appreciative of being able to have this conversation over the course of a number of meetings rather than rather than just one meeting which is what happened two years ago. Very very appreciative. Um I think uh in general I think that we should have this conversation today and postpone the final, you know, have staff move forward with both ballot measures until we get to July. Um so that we can continue to hear from the community and see what happens. and then make sort of a final decision in make a final decision as we have more conversations about one or two zero or one or two um two two. So my my preference here would definitely be to um have Brian submit the ballot measure to the state like he talked about to make sure it's copacetic and to continue to direct him to taking another step to putting it on the ballot.

Okay. Um I do have a apologies. I do have a question. Um do we have to allow like um uh the arguments? So So we have we have two proarguments and then two rebuttal. We have a proargument and a conar argument and then we have rebuttals to both. you have a primary argument and which some which with the council would sort of figure out how to do which I'll ask a question about.

You you could choose to do that. there's a the default process if you don't, but it's set forth in the resolution um looks like page 338 of your packet where it describes the primary arguments and under the elections code, the city would authorize one or more members of the council to author that primary argument and um and either the same or different person to uh submit the rebuttal argument to the arguments against the measure. So that's how you set up the primary and the rebuttal arguments. And it would and it would so if we wanted to have so let's say let's say that we so Bob and Hans are on the finance subcommittee and let's say we tasked Bob and Hans with going with going back into going back into the back and working with staff to come up with a primary argument 300 words right um would would their names appear on the ballot or how would we get more names on the ballot? Do we need to have them bring back a bring back their primary argument to the city? Um and then the council would vote on like like if I sent if I sent the two of them to the back, how do I get my name onto the ballot as a supporter of the measure?

If you're going to move forward with this, I'll get you the answer at your next meeting. Um, I've typically seen it um that the two authors um names are the ones that are on the ballot um uh to show for the argument. Excuse me. Um now whether or not you wanted all council members to be on it, that's probably going to have to be a decision that would the entire council would need to weigh in on it. So, sure, if you wanted to have um designate two people now, for example, to start on the primary argument and bring it back to the entire council and at your meeting in June and and have the entire council weigh in on it, you don't need to make that final decision today.

Do rebuttals like the rebuttal argument seems to be more time compressed. Um that would operate the same way or you can find that out by find that out by uh next month. Okay. Um, a note back in 2019 when we were doing this for the 2020 ballot and Brian is right as I remember we did declare a fiscal emergency back in 2018. So 2019. So that's how we I think that's how we got it onto the primary ballot. Um, I think

no, it wasn't a special election. It was on the statewide primary ballot. Um uh I I would say, you know, relative to the sort of argument the the these ballot argument questions, we had, you know, back in 2019, at the beginning of 2019, we had like at least two, if not three meetings where the five of us words smith the 300 words that were going into the ballot book. And it was really terrible. like it was a it was a terrible process. Um it it wasn't really divisive. It's just you can imagine having five authors trying to write 300 words. So I would definitely, you know, I would say I'm interested in having all the supporters sign. You know, I think the ballot argument looks stronger if four or five of us sign it rather than one of us sign it. So I think we should investigate that. Um, I would also be in favor of like you two were on the finance committee. I would be in favor of just sending you back somewhere and having the the ballot argument come like twothirds finished uh before rather than just having it start. I think you guys are familiar with um you guys are familiar with uh the finances of the city and how to and how to structure um how to structure you know stuff with voters and stuff like that. You're elected officials. you ran campaigns. Um, and so that would be my preference as to how we sort of make it to how we have that, how we sort of jumpstart that conversation.

All right. So, I heard you say, Jeff, that you're not going to be making a decision tonight about which tax you want. You want to get more input from people out there and give it some more thought. Yeah. Correct. Okay. You you you were against moving based on fear and you're also seem to be at this point uh for having only one of the two options. I feel like I could be uh you know I I really like I'm really undecided on all those things and I really want to hear um I really do want to hear from the four of you. Let's go around. Bob, why don't you go next? Thank you, Jeff. That was very very very helpful. Jeeoff, um

yeah, I'm probably in the same place for now. I'm in in support of either or um both. Um I'm not in support of neither. Right. Um I I I know I know we have needs. I know that they're legitimate. Um um I know we are focused on finding operational savings in the existing budget and the existing team um here at existing staff. And we have to continue to do that because the voters will want to see that. Um, and you know, I've only seen a year of progress there. I, you know, we need to see more. Um but what I I feel like I'm deep enough into the numbers to to know that if we are serious about addressing our really monumental um deferred maintenance infrastructure problems um before they you know tank us completely uh we need re we need revenue and this is one of the levers we've got. Um and um so I I I would say let's keep both going. Um let's h let's do agenda agendaize it again in June. Let's not you know not wait for July. Let's keep the conversation going. I don't think there's any more important conversation to have. Um uh the merits of doing one versus two. I understand uh well I think there's a lot of wisdom and making really really really sure that if we do both we feel really positive that both could be successful and I I what I heard you is that my it's my same concern is that um people will choose one or the other not both and in the end you just lose both. Um the

I think this this November election is going to be there's a lot of tax issues out there, you know, being talked about at the state level, at the federal level, and um uh and and um the school board is going out, you know, they've got they've got the same argument that we have a ton of deferred maintenance and we need a lot of money. Um so that's going to be on there. Um, so the the more the the more tax measures, the worse. And I think there's just going to be a lot of stuff in the press, especially with, you know, a lot of wealth taxes and um u um transfer taxes, mansion taxes, vacancy taxes, all those things are in the news right now. Um so that's working against us. Um, as I think about it, you know, the toot um is probably an easier um I think it's a little easier for the voters. Our voters are all residents and citizens of this town. Um I I hear it every day. They're feeling overtouristed. Um and um you know starting to connect some dots to um uh visit Carmel um which is funded by a 2% assessment that's assessed by the lodging association and a little bit more by the residents association. Um and are just feeling that all that marketing is just driving more people into town. Um, and that if we can't stop the marketing, well, then maybe we just need to get more money out of it. Get more money out of it via via a lodging tax. And the residents, unless they're deciding to spend the night at one of the hotels, they don't pay the tax. So, um, whereas the sales tax, we pay and it's not a big number at all, but

nonetheless, it's something that we do pay. Um, so I sort of lean a little bit more towards that one. I also know we've probably got a better organized opposition um um on the on the toot. So I think we just have to keep talking about it and I I hope more people show up and give us their opinions um on it as we go forward. Um I think that's it. I think that's where I'm at. So, so the fear factor isn't driving you at all or

um Yeah. So, what Jeeoff, it was really helpful that not yet. I mean, I think Brian's going to get us some more answers on the sales tax, the TOT. Um whether I should be afraid. I don't think I'm afraid of MST. Um just because again, I don't I don't see a majority of the board supporting it when they all represent the cities as it is. and and it's a big board. I mean, so I think it's unlikely to happen in in the near term um if at all. But I I want to make sure MST is the only one out there that like I said, if the county can do something that I am afraid of that,

but but you're not you're not thinking let's do it now so that somebody doesn't do it at some point in the future. You're you're willing to let it I need more I need further information, but based on what I've heard so far, I I think I'm just I'm not afraid that we have to jump on it before the other one, but you're neutral, but I'm listening. Okay. All right, Hans.

Uh, yeah. So, I was I was initially totally uninterested in the sales tax option. Um, you know, when we were down in the conference room and the staff brought it up and, you know, they were making some noises about it and I wasn't really understanding it. Um, you know, we already raised the sales tax twice in the past 10 or 15 years and, um, but this dynamic about the cap and, um, the use it or lose it notion, um, I think it's changed my thinking a little bit. So, I don't think MST will do it for the reasons that you talked about. Um, but I do think that the probability of the county doing it and and taking this sales tax increment, you know, in the next 2 to four years is like reasonably high. I mean, they recently had a hiring freeze. They're talking about raising their toot um

transfer tax

transfer tax. You know, the other thing is that the stock market is at an all-time high and so I feel like there could be some market headwinds coming up which would exacerbate the situation for them where they'd be looking around for some additional revenue. Um, so my thinking now is that if there's a reasonable chance that they could snatch up this increment, you know, then basically if we as residents of Carmel are going to pay this anyway, and that's I think what we need to kind of assess and you know, Brian, I very much want to just make sure that the county is one of the groups that can step in and snatch it up. But if that's the case, again, if if we're going to pay it anyway, then I'd like that money to stay in Carmel. Bob, you said it before. So much as a general law city, so many of our revenue streams are pretty capped um and limited. And so, you know, the sales tax, there's literally a state cap on, you know, we only get one and a half% of the 9.25% that we pay. only one and a half percent comes to the city on property taxes. We only get 6% of of the property taxes that we pay, right? So, we have these limitations and you know, this is has become interesting to me and more compelling than I would have thought. So, I'm I haven't made like a final decision on it, but I agree with you. I think we should continue to push it forward so that the option remains. And some of these questions, Brian, if we can kind of sharpen our pencil, some of the questions that Jeff asked, you know, getting from a tentative answer to a firmer answer, um, I think that would be very helpful. You know, in general, I just think there's there's a lot of different factors at play. I mean, we need a couple of things to land before we can put the picture together. Um, so I think this is the right move is just to kind of continue to go down the road

on this and and you know, obviously I don't think we even can make a final decision tonight, but some of the things that, you know, we need to firm up. So first, you know, again, I'm going to continue saying this because people tune in that don't follow this stuff religiously and they come to a meeting and they haven't been here. We have spent the past half year um in our finance committee looking at deferred maintenance and the staff has really done a great job of trying to sharpen their pencil on what those numbers look like and it's about $und00 million of deferred maintenance and we've talked about this in past meetings, but it's roads, it's sidewalks, it's beach infrastructure, it's our storm water system, you know, it's things that people talk to us about all the time um when we're elected officials. Can you fix these things? And so what I want to talk about here is kind of the process for us. We need to come to a long-term plan to deal with those things. I think our 5-year CIP plan, the capital improvement um budget, I think it did that. I just we need to all make sure that that's where we're headed. And that was in the neighborhood of $10 million a year for the next 10 years, which makes sense. $100 million, you know, over a reasonable time scale, you're going to have to be talking about those kinds of numbers. Um, we just need to make sure that we all agree that that's the right amount and the right approach. That's like the foundational step. And then the next step is how are you going to pay for that extra capital investment? And there's basically four options. And we need to pick three out of the four. There are budget cuts,

uh, sales tax, toot, and paid parking. And, you know, we we aren't even going to talk about paid parking until June. I hope that can be a pretty robust presentation as opposed to just like a tentative initial conversation. Um, but again, I think the math on this, and I've shown it before on a screen, I'm not going to do it tonight. You basically have to pick three of those four things. Um, we also don't talk about the budget until tomorrow night, right? And so, it would be interesting to get some some buy in on um how much. So we had a policy where when this council was seated, the budget had us spending 100% of operating expense, 100% of revenue on operating expenses. And we then last year implemented a 9010 policy where we reallocated and said, "Hey, we're going to cap operating expenses at 90% of revenue." And this year we encouraged the staff, hey, can you at least present to the council a budget that's capping operating expenses is 85% of revenue. In other words, 15% goes to capital expenditures. And so that has not been really daylighted to the council yet. Tomorrow night, it's going to be the first time that we talk about that. And so we need to figure out some of these different pieces to figure out how do we but we have to count to $10 million if we decide that that's where we want to go. And um I don't know I was talking to Brandon about when this actually happens and it's actually one of the challenges because paid parking is in June but you really want us to have this discussion at the budget workshop. So I think we should be prepared to do that. you know, we've kind of been I don't say pjoratively, but we've had the luxury of a bit of time because Jeff helpfully forced this discussion early, which was great. And

now I think we need to be prepared in that meeting to sort of have all of these different things land. So, um, I don't think we need to make the decision tonight. Personally, where do I stand? Very similar to all of you, I could go with I could go with one or the other or both. I'm probably a little bit more um open to both because I feel like we're all going to be campaigning. You know, you and I are going to go knock on everyone's door in the town so we can make the case. I think we all believe in this deferred maintenance problem. And I think that I think that that's a case that can be made. I believe in the residents and um you know, they're smart people and I think we if we make that case to them, I think they'll understand it. So, um, yeah, I think it'll be a very interesting budget workshop.

Sure. Allie,

thank you, mayor, and thank you, Hans, for presenting that the way you did. Excellent. Um, as Hans just said, um, and we've been hearing again and again when we've been discussing the budget, the city really, really needs the money. Um, when you look at the sales tax for the 375% increase, just taking for example, um, if you got a $6 cup of coffee at a coffee house, that would be an extra 2 cents that you would pay. If you had a $100 dinner, uh, it would be an extra 38 cents that you would pay. I I think that we should continue to move forward on both. And, um, I share the same arguments that I've heard from my fellow council members. Um, I think we do have a sophisticated, smart group of residents in our community just as a whole. And I think that they are sophisticated enough to be able to understand two separate tax measures on the ballot uh at the same time in November 2026. Um, I think having it presented in the voters's guide with the arguments that we're going to all work on, and I do agree with Jeff that the finance team should be key in writing it, but we should all author it. Um, assuming that we go forward with that. Um, in our budget book, it says that 76% of our residents have at least a BA degree, and I've seen statistics that say it's an even higher amount in the 90s. So I think people can be able to understand the arguments and frankly um all of us explaining and having the media as well, you know, get the message out about um not only the whole deferred maintenance, but how we as a council are trying to tackle it. And it's going to be a 10-year um plan ideally. Um and as Hans just mentioned, you know, we basically need 10 million each of those 10 years to um be able to handle all of the um items. And I I know this will be a bit repetitive, but um you know, our city infrastructure um

these sort of things have been put off for years and we need to address. We've got 8 million for beach maintenance and repairs. Uh we have our streets that need to be in better condition. There's certainly um improvements in preventative maintenance we can do. Um and we're basically asking everybody to do their share in this. Um and you know there's there's four options we can do and and we're still going to make the final decisions, but I I would be open to the two. Um and just one other side note, um I do agree with Hans and Bob about if there's a way we can put in that 1.887 887 million in the ballot question. It just makes it a little bit clearer when you get to that total uh number of the 9.4 million. Um so that's basically where I'm at. I think we're all as a whole kind of pretty much in in a similar spot in in how we're analyzing this and look forward to our future discussion tomorrow and then in our June council meetings.

Thank you. Thank you. Um, I think that uh I personally think the sales tax sales tax is a and you put it in good terms, Ally. I think it's pretty clear that I it's it's a good way to get what 1.9 million, which is 20% of what we need. Um, I'm still mixed on the TOT, but I could be talked into it. the uh I think I think to play off of what Hans is is heading towards that 10 million is a big number and in the out years it starts getting significant. I mean, the first couple is going to be fine, but if we start chewing into our reserves, I mean, I think the number is bigger than than 100 million because we we haven't accounted for cost of living or inflation based on what I've seen and inflation at 6 to 10% could be chewing 6 million out of our our 100 million every year. So, I think we need to think big and I think if we don't, we're going to really find ourselves in a bad place in 3 four years. So, um, I really would like to get a better feel for how many of us think that we could do two because I think we need to really start thinking about that now, not wait till June. So, uh, I don't know if any of you are ready to say that. But I think that's a big deal. I think that's really where we're at is do we are we going to go for one or two? And then if we're going to go for one, which one? Um, I also have some concerns about the language. I have a Could you put it up? It might It's sort of a baseline to start talking about the language because the uh

You're talking about the ballot question. Yeah, she's got something she could put up there. I basically cut it down to the bare bones and simple as possible. I I was a little uncomfortable with actually giving examples of what we're going to use the money for because somebody could come back and say, "Hey, you're saying how you're going to use the money and that's a that's a higher threshold." And I don't I don't if we have sophisticated voters, I'm not sure we have to tell them what municipal purposes are. But

well, that that actually that would be um if we did strike that language would give us a few more words to insert the 1.9 million um being raised from the 375. So, one of my points is I think they should be similar. I don't think we should have different logic and where things show up in the question because the question's already just two words at the end and it's sort of confusing to me. So, uh I cut it back. I think you're going to have to add some words back into the sales tax one because uh of the the length, you know, how long it's going to go the termination. That's why you added both of them together in that. But uh and we don't have to decide this tonight, but I'm just put that out there that I think as simple as we can make it is better and as short as we can. As it turns out, the second one's longer. But also, I think if you're going to use the 1.9 million in the second one, you should probably use how much we're adding in the first one, too, so it's consistent. It also shows that it's easier for us to go out and talk to voters. It says, "Hey, there's two million here and two million there. That's four million out of the 10 we need. That's why we need two if we're going that direction. If you just lump everything together, you can't make that argument like what are we adding?

I would only mention that I don't believe you have a time limit on your toot. So, I'm looking at the ballot question for that and we've said extending the duration of the tax. So, I'll take a I'll take a look at that. Yeah, take a look. This is for next maybe you come back with something as simple as you think we can get away with. Yeah. Well, when get away with, you mean that's legal, right? Well, well, I I mean that. I mean that because in some cases it said be careful what you're saying about how you're going to use the money. You're saying you're going to use it for we might use it for something different. May I go? Yeah, go ahead.

I think uh I think this is, as I said before, I'm struggling with trying to decide which one and trying to decide one or two. I'm more set on the one versus two, but that's a little bit flexible. But I think um I think having these two things up here um at the same time I think what what would help me like be closer to a decision next month would see would be to see what these paragraphs are going to look like. Like I think that you know I think that you Hans raised an a really important point about the 1.9 million versus the versus the versus the 10 versus the 9 whatever million and I think so that's a conversation that you know if that you and Bob could have if if the two of you are going to do it that you and Bob could have with Brian um and see like and I I think that Dale's point that these things should kind of look like if we were going to do two I think they should look kind of the same. I think that's a valid point. Um, but I think also like again from my perspective like seeing the two of them up there on this on the same piece of paper with the same sort of layout of the arguments would help me decide which one I think would have a better which one at least would have a better chance which is one of my which is one of my criteria about how I would make those two decisions. So maybe we could I don't know maybe the two of you could have something ready by next month. Um

shouldn't take that long. Yeah. And for the packet next month and we could sort of Yeah. I I think Dale's given us a really good start. I mean this this these both the same format. They're both focused on the incre increment. I think that's the main thing. So it's I think it's a good starting point. I agree with you Jeff. That's I would love to see that. Yeah, I think that I think that would really help me.

Okay. There are some legal requirements about what has to be in there. So, um what I could do is um take the form that I'm seeing. I I get the point about having them look similar. Um but there's some sections that will have to be will have to be different and there's some sections that are legally required to be included. So, uh, I I can I think I'm here in the council and I can certainly draft that and circulate it for everybody to comment on. But anyone who wants to send me suggestions like is the council happy with with Bob and Hans taking the lead on the wording issues that we need to by June. Yeah. Okay.

I think this is easier than the show of hands. Everybody's in favor. All right. Good. All right. Our next FSW meeting is a week from Wednesday. Yeah. Yeah. So, so you can do the 300 words by next month, too.

Um, also, uh, before we end this, um, Brian did, uh, Brian did send me this special notice from, and I didn't have a time to read it until just now. And there is language in here, Hans, that uh I'm so I'm gonna correct myself and I'm gonna ask Brian to um to verify that this that this language is correct in this notice and I'll ask Brian to send us to all five of us. Um, but there is a sentence here that says, for instance, if a county proposes a new tax that would cause the combined district tax rate in a single city within that county to exceed 2%, the board of the board of equalization cannot administer the new county tax. So that contradicts what I said before when I said I thought I had bad news. So if Monteray, so what I read into this is if Monteray passes their if the if the if the sales tax measure passes in Monterey on primary day, um that will prevent someone else in that includes Monterey from raising their sales tax and

including Monterey County. You mean I'm sorry, Monterey County would be able to

correct. Right. So, no. So, Monterey County, MST, MST wouldn't be able to go higher than a than an eighth of a percent. Any organiz any district that included and the language that Brian uses defines the word district. Um, uh, no district that includes both Carmel and Monterey would be allowed to would be allowed to raise their raise their sales tax. The only thing I would say is just to reiterate to Brian, I guess I'd love to have some council direction, like if we could just make sure that we dot the eyes and cross the tees on all of those questions. Um, maybe send something to all of us. I think that would be really helpful.

So, Brian, Brian, I will send you I get what you're saying. I'll send you those correct. Sure. Based on what I heard tonight.

And then you can work with it with the stewardship committee. Um, I'm a little surprised that we didn't get more support for the sales tax. I I really would like to The Time's going to fly. It's going to go faster than we think and we're going to need to start making decisions. So, I didn't I I think I heard reasonable support for sales tax, but I think GI put it in a pretty clear way that it's it's not significant in terms of impact on any of the residents in terms of how much it's going to be. Um, I really would like to start locking some of this down. I'm open on the tot to to to hearing the arguments, but I'm not getting any clarification that the sales tax is a go.

It's a go. I mean, the I'm I'm supportive of both. Um I'm I think we need to continue to have a conversation in June um especially after we've heard um paid parking um about just the wisdom of doing two versus one. Okay. And I'm just not I haven't made up my mind. I'm I'm still open to two. Okay. So I it sounds like a lot of us a majority is still open to two. Yes. Okay. I just want to start getting some narrowing down of options. Okay. Good. Great discussion everybody. Are we still going to do the the toot segment of this? Yeah.

The total. Okay. We sort of covered both in this one, but well, we did, but there's So, we're going to open up the next I think we're ready to close this off. But before we go there, um I would ask for council direction on whether to um submit the draft um ordinance to the California Department of Tax and Fee Administration for review. I think that would be helpful. Uh, it doesn't necessarily mean that you're going to approve that as a ballot measure, but I I wouldn't want to wait until to do that later. Do you want to show hands? I'd rather I'd rather hear a motion. Okay, go ahead and make the motion. Okay, that would be a motion to authorize it. No, we'll approve it. You make it.

Okay. Well, whoever you want to make a stab at it, Jeff? Uh, I'll uh I'll find it and just make it. Hold on a second. you go to the right page. It's at the end of the recommendation. I'll make a motion to submit the draft ordinance to the California Department of Tax and Feministration for review. Second. Roll call, please. Council member Baron. Yes. Council member Ber, yes. Mayor Prom Delts, yes. Council member Dram, yes. Mayor Burn, yes.

Motion carries. All right. Anything else we need to give you, Brian, before we move on? I think I have all I need. Um, I've got some questions to answer and we'll get back to you in June. Okay, good. All right. Item 10, transient occupancy tax 2% increase measure. It's a discussion of draft resolution submitting to voters a measure to adopt a new 2% transient occupancy tax in addition to the existing 10% DOT approving the form of the ordinance requesting that Monterey County elections conduct the election and consolidate it with a statewide general election on November 3rd, 2026 directing the city attorney to prepare an impartial analysis and authorizing the drafting of primary arguments and rebuttals. We are here for discussion and direction.

Well, thank you, mayor. Go ahead. Uh I I believe you've accur accurately summarized what the item is. So let's move into the background. Um the staff is requesting that the council discuss and provide direction regarding the draft resolution and ordinance which is in your packet, which would be to uh submit to the city's qualified u voters a ballot measure that would adopt a new a new 2% trans occupants tax called the toot in addition to the existing 10% if it were approved by a majority of the voters. Next uh slide. Here's the ballot question. I think we already had some discussion about that uh on the prior measure. Uh so um I will um do my best to come up with some language that makes the this ballot question symmetrical with the ballot question for the sales tax. So you can talk about them both. Um there are certain legal requirements of language that needs to be included. So, um uh I'll I'll make sure that that is in there uh and uh we'll take we'll take care of that um for your next meeting, assuming you give direction to bring this back. Uh next item. Uh this looks familiar to you from the last uh agenda item, so I'm not going to spend much time on it. It's going to take a four-fifths vote by the council to approve the resolution and a majority vote of the electorate uh because it would be a general tax. Um, next uh slide please. And again this is similar to well not similar identical to the u process u that you would follow for a sales tax measure in terms of um what the resolution uh would require. Um although this one specifies would be a toot of 10% rather than the sales tax uh item. Uh next slide please. So here are the changes to that are that the ordinance would uh have. Um, it would be

that you would have a 10% uh that would be charged that's existing and then you would add language. I'll just read it. It says plus a new tax in the amount of of 2% of the rent charged by the operator for a total tax in the amount of 12% of the rent charged by the operator. Next slide. Uh, this is on the disposition of proceeds. uh it would add a subsection C to section 332130 and it would say that the additional 2% that would be added by this ordinance number that uh we we got from NOVA um shall be added to the general fund for usual usual and uh current expenses. So confirming that this is a general tax. Next slide. U this is similar to what I mentioned previously about uhformational activities. Uh next slide. Uh this is the same uh election timeline that you saw with regard to the sales tax measure. Next slide. Uh the recommendation here is to discuss the draft resolution and ordinance relating to a potential ballot measure for a new toot of 2%. in addition to the existing 10 and to provide uh direct a motion to provide direction to staff of whether to return to the council in June with the resolution for the ballot measure to be submitted to the voters and next slide and I'm available for questions.

All right, go ahead. I have one quick question. He was first with the

first with the button. Uh just to pick up on NY's question, she was talking about the rebuttal and I think I had forgotten that the rebuttal is actually the rebuttal to the opposition argument. So who has the opportunity to file the opposition argument? I don't have it committed to memory, but there's a um section in the elections code that has um a priority and the city clerk then she may even know the answer to this um as to who's first in line. If uh the council chooses not to uh if you if you choose to support the measure, then the opposition would obviously not be filed by the council. Um it would be others. Um, Nova, do you happen to recall what that um pro what what the priorities are? If if not, I can bring it back to you at your next meeting.

I I don't have that answer, so I'd have to look that up. And

yeah, as as would I. So So basically, the city council would write the pro argument. Then through this research you're going to do, we'll figure out somebody would presumably submit an opposition argument. And then the city council would also write the rebuttal to that opposition argument. Yes. Now the comment was made. I heard about how with the rebuttal there might be some compression on time and whether or not you would have time to bring it back to the entire council or not. Um because it is fairly, you know, given that your meeting schedule uh is the way it's set up. So there might be a need for the rebuttal to be you might want to designate a couple of council members to author the rebuttal

or we could have a special meeting or you could have a special meeting. I've got a question. Are we're saluting questions?

Yes, we're questions. Um, just on the last thing, I'm worried that we didn't do that motion correct because we had in our packet that we should also direct staff whether to um have the draft resolution ordinance presented to the council for consideration for adoption at the June 2nd meeting. And I think we only included the second half which was in whether to submit the draft ordinance to the California Department of Tax and Fee Administration for review. I just wanted to make sure if we did that correctly. So, it will come back to the council in June. Yeah, that you make a good point. Um, we could confirm that direction. I mean, I heard what you had said. The the motion um to present it to the state was um something that we felt was was needed because that's going to be an informative action we're going to take. We're going to send it to the state versus just bringing this item back for further discussion. But we could certainly return to that item and and have that as a motion if you want to make it. I

I think just to be safe. So we know that it's definitely for sure going to be on the Jin agenda because it's important to So do you want to return to that item now or wait until we finish this? Let's finish this and we'll come back. Okay. Okay. Thank you. Thanks for bringing that up. So in the last item um there was an option to have you send the text of the tax to this the sales tax to UT to the state to have them validate it. And you didn't present that as an option here. So I assume that's not an option here. Correct. Okay.

Any other questions? Public comment. You're back. This is a really important issue for me. Today is my 80th birthday and I'm not going out to dinner so that I can come here and support our council that I really appreciate has taken a stand on this and protecting our city and our residents. Um the council we have now are really good stewards of our town and our residents. I feel in the past there might have been business um influences that perhaps allowed this 10% tax to be allowed to go on for 30 plus years. Um and it's not just about the tax. It's about not allowing a certain group of businesses in this community to dictate what is in the best interest for our town. That's really important to me. And I have been a hotel owner. I understand what they're doing. Um, when I was a hotel owner, it was a privilege for me to own a a business in a property in Carmel by the Sea and I was happy to and it was not a big deal to market because everybody in the world knows Carmel by the Sea. Um, I know there's a lot of talk of why

it's necessary to uh pay this extra 2%. Well, that's their choice, but it has nothing to do with the tax that the city should get and that revenue to use to improve our city in whatever manner our city needs to be improved. And I feel very strongly about that. I appreciate that you are supporting those issues. Um, the other thing that really upset me at the last meeting is that somebody got up and threatened the city uh that we they'll be sorry if they continue to go ahead with that. I I don't understand that. I just don't feel that that's uh good business or respectful. Um I think presenting these issues are very simple. I'm a very logical person. I'm a very visual person. If you make charts and break them down so that this is the city tax hasn't been raised in 30 years. This is what the other cities Half Moon Bay 15% safe South Lake Tahoe 14%. etc. you go down. It's very clear. It should have nothing to do with room rates or what the hotels are making, what they're bringing, how much more money they're making for the city. That's wonderful. They're also making a lot more money. So, the city gets the tax on that. I mean, to me, it's very clear and it's not unreasonable because it's in the same line as what most other cities are paying. Uh, I don't understand it. I don't understand where they're coming from.

I know what they're trying to say. I don't agree with it. Okay. Thank you. As far as the sales tax, the same chart should be used and that would make it again easy for people to see. Thank you, Andy. I don't feel there should be any negotiation in the tax. If the hotels wish to have an extra 2% for their own paying of advertising, which I never heard of this, we all paid as individual hotels for our advertising, but if they want to get it from their guests, fine. That has nothing to do with the city. Thanks, Andy. Your time's up. Thank you. Okay. Um, you're you're a minute over. That's it.

Okay. Appreciate you being here. Anybody else? Anybody online? Okay, Mark Watson, go ahead. Mark, we can't hear you. Sorry. Can you hear me now? We can. Hello. We can hear you.

Okay. Good evening, Mayor and City Council. This is Mark Watson with Ins by the Sea and I'm speaking on behalf of the Carmel Inkeepers Association regarding the proposed transient occupancy tax increase. On April the 22nd, we held a workshop attended by inkeepers representing more than 60% of the hotel rooms in Carmel, and the group voted unanimously to oppose placing a toot increase on the ballot this fall. Our position is grounded in current performance and forward outlook. Over the two years following the city's last consideration of a tot increase, toot revenues grew approximately 23%. And current forecasts from Visit Carmel project an additional 11% increase in 2027. This level of growth reflects strong demand, continued reinvestment in our lodging product, and targeting our marketing efforts. Based on this momentum, we do not believe a tax increase is necessary at this time, and we are concerned it would risk undermining that progress that we have made. The local hotel community is not opposed to supporting the city's financial needs. There is broad support for exploring alternative revenue sources, including a potential sales tax increase, which we believe may have more a more balanced impact across visitors and residents. and visitors, by the way, pay more than half of the increase in sales tax. We also want to be clear that our position is not inflexible. Should tot growth fall below expectations in the coming years, the inkeepers have expressed a willingness to revisit this issue in 2028. We respectfully ask that the council consider the strength of our current toot performance, the unified position of our lodging community, and the

potential risks of a rate increase at this time. Thank you. And thank you for all you do for the city. Thank you, Mark. I don't see any other hands up. Anybody else want to speak in the in the chamber? All right, let's bring it back for discussion. Ally,

thank you, mayor. Um, as we've discussed in our previous topic, um, the city has certain ways, especially as a general law city, uh, that we can raise revenue. Uh, the city is also working on, um, cutting the budget so that more money can go to this, um, CIP. Um, we just heard about sales tax and um the toot is another one of the options or levers as as Brandon says uh that we can use to bring in this money that we need. Um it feels like this is the time to do it and we have to give it um our best shot and it seems like if we would ignore it it's or not even try to go forward with it we would be negligent because it's one of um the options out there. Um, I use the example breaking down what the um, sales tax increase would be. Um, and looking at the 2% increase in the toot. If there's a $400 hotel room, it would add $8 to the charge. If it's a $500 hotel room, it adds $10. It doesn't seem that that's a real deal breaker for a customer that's willing to spend that amount of money. uh if we don't go forward with the toot now, we'll have to wait another two years again to try um in 2028. And um we're asking everyone to really do do their part. Um the money is going to go towards the city infrastructure and deferred maintenance um of at least $und00 million as we've heard. Um and furthermore, if our streets and city looks good, the hotels will benefit from that. Uh I had two little items I wanted to mention. Um when we look at the ballot language I agree that it's very important that it's parallel if we are going to do two and in this one we um bring up the 1.9 million but we don't give a total number. So I think we need to be consistent in however we formulate that. Uh and then second we were talking about who does the rebuttal. My guess would be the hotel industry or

representative from them would be the ones to do the rebuttal. So that's just my summary on that. Thank you. Hans, you want to go? Yeah. Nova, do you think you could pull up that slide for me?

Um, I guess while she's pulling that up, um, you know, Alessandra had a comment that something to the effect of basically like this is sort of shared sacrifice. And I I think that's actually true. You know, we I have heard some comments. Um, first of all, I have a lot of respect for the hotel years. I think they actually do a great job. they've done the city a significant favor in helping themselves. They've really helped us. Um that growth that they've had in Toot revenue has been very meaningful for the city. Um so I I don't want to discount that. But again, back to this point of shared sacrifice, we're talking about, you know, this council having cut operating expenses if we go with this budget by 15%. you know, based on the trajectory that we had when we came into office, that's almost $6 million a year. Um, we're asking for about a little less than $2 million on this toot increase. So, the residents reduced operating expenses $6 million. We're asking for 2 million here. Um, we're also thinking about the sales tax. Like, I just think it's uh I think there is some shared sacrifice that's happening. The bigger point that I wanted to make is it's actually been a while. I looked back, this topic initially came up, you know, to Jeff's credit in February. Um, and it's been a while. We've had subsequent meetings on it, but there was a staff report initially in that initial meeting that kind of benchmarked our toot rate relative to other cities and jurisdictions. And, you know, that one just hadn't come up in a while. And there were a couple things about it that I sort of I wanted to add some things. So I went and just kind of reconfigured it and collapsed it and did some additional research. And you know to me it's really not the argument about how long it's been since there's been an increase. You I actually

think Mark Watson has a point which is like based on that logic taxes just spiral up and up forever. What's most compelling to me is just when I look at this graph and I say I I literally went to uh Google and AI and said give me comparable like luxury destination uh locations in California and it gave me essentially this list many of which were already on the staff's list. It wasn't like I was cherry-picking like truly this is not a cherrypicked list. This is the list. And so when you go down Half Moon Bay their base toot rate 15%. Again, South Lake Tahoe 14, Salelo 14, Beverly Hills 14, San Francisco 14. Like just go down the whole list and we are we're literally at the bottom of the list. And to me this is the best argument for it. Um it also I also factored in essentially the marketing dollars, the business improvement district or the you know the tourism district um for these different locations. And you know even if you look at the right-hand column um again it's a it's a pretty similar story. um you know, we would be right in right in line with all these other places even on the lower end of the list if we uh if we did this increase. So, I just figured I'd flash this up there one more time for us. Jeff, thank you. Um I don't really have any comments past uh you know we've we've had a couple a few more than a couple meetings on this and I don't have any I don't have any real comments um to expand on what I've said in the past. Um this again this is just just that this is my slight preference over the sales

tax at this point and I look forward to uh seeing what uh Hans and Bob write for especially for those 300word 300 word descriptions next month and and looking at them. Right, Bob.

Yeah, I I don't have a lot to add at this point. I mean, I as Hans said, I I have a lot of respect for our lodging community. I think they took the bull by the horns years ago and decided that they wanted to be in the marketing business and not have to be going through the city to do it. That's the right choice. City governments are not equipped to market the destination. Um, and they decided to essentially assess themselves and really assess their um, their customers um, to raise roughly $2 million a year uh, that they use to market the destination. Um, and um, I just keep going back to the same thing is that I think we're now over marketed um, and not speaking for the city or for the lodgers but for the residents. Um um uh I think we're just really tired of it and um I think there's a I don't know it's a a little bit of a tonedeafness on the part of the lodgers um as to the problem they're causing. Um, I think there could have been a middle ground here and there still could be. Um, you know, if what why do they need $2 million or why, you know, why do you need $2 million a year to market the destination destination and not 1 million a year to market the destination? Um, they seem to be very successful at 2 million. I remember a wise boss once told me that 50% of all the marketing dollars we spend are productive. I just don't know which 50%. And I still don't think that's kind of true. Um I think they are uh there's an argu they make an argument that they are um only marketing to put heads in beds. We're only marketing um to you know to people that are likely to stay in a hotel. You know, we're not marketing to the day tripper. To which I say, I don't think that's possible. I you know, show me your metrics. But if you create

digital content, digital content goes where it wants to. Um it's kind of like water and um you can't direct it exactly where you want it. You can, you know, your your first salvo can perhaps be at um at that audience, but beyond that, it just goes and goes. You know, we I was watching the marathon um on KBW and there was an ad for visit Carmel. Well, KSPW is not the likely let's stay overnight audience. So, um I'm still open to that kind of a conversation, but I I don't know that they are at this point in terms of kind of controlling the marketing. And at this point, I'm I'm still very open to doing a toot uh because our town is uh getting beat up and we need to start fixing it. Thanks, Thank you. I think that was well said and I I've uh had some discussions with them and floated some ideas and it's been pushed off for future years and I think we need to make decisions this year. So um let's go out for public comment.

Oh, we did. We're out discussion. I guess I'm getting hungry. Well, that's really good news. All right. Um, all right. I think we've had So, just just to be clear, um, Hans and Bob are going to work with the, uh, city attorney on still not the I mean the ballot the 75word ballot question to the extent you can the extent that he that he provides you with like the legal framework to do that, but also the 300word arguments on this on this measure as well. Yes. And I think they're very similar. So, yeah. Yeah. Okay. I just wanted you know.

Okay. And we already talked about the language which I'm going to send you the latest version. So you can work with the team to to refine. I Yes, I can do that. Okay. Good. So um in line with uh Council Member Dram's comment um on the prior item um I think you might want to consider a motion um so that the direction is clear. Do you need anything on the toot before we go? Yeah. Yeah, go ahead.

Can I interrupt you for a second? Um, I wanted to make a comment on I know you guys are going to go write uh write write the 300 words, but I wanted to make a comment that um when you I think were talking about the plethora the plethora of tax measures that are coming up. Um, one of the things that you mentioned which uh which I thought um which really got some wheels working in my head was the the CUSD bond measure and that's a bond measure, a property tax measure and I think it might be you know for me when I think about the difference between a bond measure and these tax measures like that might be worth like five or 10 words. So, I I'll leave it to you um to sort of figure it out, but those are really different animals. And I think moving away from that, moving away from that a little bit might be useful strategy when you when you go back. That that's what I wanted to say that during one of these meetings. Okay.

Okay. Brian, go ahead. Yeah, I was going to suggest a motion unless somebody else wants to make it. I've been making notes on the various points you've made. So, is this on the toot or is it on to start with the tot? Go ahead. So, um, the motion, whoever decides to make it, uh, that I would suggest would be that the, um, city attorney would work with, uh, council, uh, council member Delves and council member Pewer, um, with regards to the ballot question language. One, two would be, uh, to work with them on the, um, the 300word argument.

I guess there's just two things. and the 300word argument and and then to um return to the council um for further uh discussion um at your meeting in June or uh did you want to have it uh teed up for action in June? An adoption of the resolution or just further discussion? I think both. I having it teed up for action if we wanted it. Okay. I'd like to tee it up for action. We could tee it up for action and then take not take action. Right.

Okay. So then the motion would be in addition to what I've already said that would return uh for adoption of the resolution and council could also choose to um have further discussion at that time. We should be prepared to take action. Yes, it'll be prepared. The the the importance of that is that your agenda title needs to say what it is you you could do. Um, so that's the motion. Okay, I'll do that. So, are we done? Was was there more? Okay, I think that was it. We're looking for I'm eager to do all these motions here. We're looking for that motion.

So, I I think I took notes on all of it. So, I'll make a motion that we have the city attorney work with council members Delves and Bter on the ballot language and 300word argument uh and return to city council in June um with the resolution for the ballot measure um to be submitted to the city voters uh at the November 3rd, 2026 election and we could take action at that meeting. Second. Second. Good. Second. Made a second. Council member Baron. Yes. Council member Berter. Yes. Mayor Proton Dels. Yes. Council member Derma. Yes. Mayor Burn. Yes.

Motion carries. All right. So now I think we need to return to the sales tax. Yes. One more. To the tax people too. You don't do that. Don't use it on both of them. No, you don't. Okay. Sorry. Go ahead. Let us back up now to the prior council member Drramoff had suggested that on the sales tax um the motion was limited to just submitting the uh draft ordinance to the state for review. Um in light of what we just did on the toot and since council member Dramov seems to be on a roll here uh perhaps she might want to make the motion as to what what to do with the sales tax. Thanks.

Well, there's no um yeah, never mind. Okay. So, I'll make a motion uh to provide direction to staff um for draft resolution an ordinance to be presented at the city council for consideration of adoption at the council meeting on June 2nd, 2026. And did you also want to include in that that the city attorney would work with council member Delves and Buter on the ballot question and on the argument and have the city attorney work with council members Delves and Ber on the argument and the um ballot language and submit the draft ordinance to the California Department of Tax and Fee Administration. Well, we voted on that part already.

Oh, we don't need to replace we we're just passing a second motion. Yes. Yes. So, just checking. Yes. Second. Roll call. Council member Baron, yes. Council member Verer, yes. Mayor Prom Delves, yes. Council member Dram, yes. Mayor Burn, yes. Motion carries. All right. I'm assuming that you'd like to take a break for dinner now rather than starting with the second triannual budget report. And so, we're going to break for dinner and we'll be back in what do you say about 7? 7:05. 7:05. We'll be back at 7:05 for the very interesting budget report.

Reese, are you ready? Well, All right, we're back in session. We're going to do item number 11, second trianual budget report, fiscal year 2025 to 26. We have Jamie giving giving the report. Good good evening, mayor and city council. We are presenting the second look at the financial operating results for the fiscal year July 125 to June 3026. And these numbers are as of February. What's the purpose of tonight? Uh is just to look at the 2526 year and see how it's running. Um, some of our bigger revenues have started to come in now. We want to see how they're looking. Uh, and our expenditures running as we expected them to do. The last time we looked at this was as of October. Just to briefly touch on the fact we're doing it triannually instead of midyear. So that's three times a year. Thus the second look which covers eight months of this fiscal year. Based on our initial review of the results from July 1 to February 28, the second four months of the year, um we see that revenues are on track with the budget and the prior year. So this is the highlights right now. Uh it's important to note that some tax revenues are not received until December. Um and that budget revenues are more budgets for revenues are more aggressive this year than they've been in prior years. Expenditures are also on track with the budget in the prior year. While there

are a couple of adjustment, it doesn't appear to be necessary to make significant alterations to the budget plan as a whole. Overall, preliminary indications are that the city's actual performance will be in line with the anticipated budget. Looking at revenues, one of the things we do is um we look here and we see that different revenues are collected at different times. So when you look at percentage received, uh one line to the next will be different based on the type of revenue it is. Uh but there's another thing we used to look at this as percentage received this year compared to the same percentage last year. But because we're being more aggressive in our budget numbers, those percentages won't be the same. If our budget was smaller in the past or more conservative, then we would seem to be getting more of it at a certain point in time. So, if we take a look at this, um, generally, that's why I put the dollar amounts in. So, as a percentage of budget, uh some of these things don't look like they're as far ahead as they were last year, but if you look at the actual dollars, you'll see that generally the actual dollars have increased one period over the same period the prior year. We do see some potential weaknesses in charges for services. We're at 57% of budget so far this year, compared to 75% of budget last year. This weakness appears to be due to more aggressive budgeting. So we had we put a larger budget for revenue in place based on our anticipated activity and the variances are occurring in forestry building and ambulance. The biggest amount is in ambulance. There's been some difficulties in getting the billing done for the ambulances after the conversion uh to the other system. We're in catch-up mode now, but we record that on a cash basis as we get it in. So if the bills went out late, the bills haven't come in yet, res revenues

behind. We also had made some aggressive assumptions that our changes in management would be changes in staffing and for a portion of this year there was no change to ambulance and then since that time we haven't seen a significant change yet that we can identify in the number of runs but we're still trying to get all those numbers together. So ambulance is behind and that's really what's driving the variance in charges for services. So those potential weaknesses though have been offset by strength in property taxes, sales taxes and transient occupancy taxes. The three major portions of revenue that we rely on. If we look at expenses, expenses generally occur evenly through the year. So we would have expected to have spent 67% of our annual budget as of February 28. Just taking the year and divided by 12. We see right away that all but two of the expense categories are less than this 67% run rate. Non-EP departmental and debt service show that almost the whole budget has been spent that but that's because those things are paid at the beginning of the year. So we're not too worried about that. So we could just kind of take those say they're within budget they're pretty much done we're okay. Now if we step back and go to the top of the chart salaries and benefits is at 62% versus uh the budget timing of 67% and it's basically in line with pace but but we'll also see that it's slightly ahead of last year's 53%. 62 versus 53. That's because we are more aggressive on our salary budget too tighter on our salary budget. We used to leave a lot of room so then it would look like we weren't spending our whole budget. Now we've trimmed it down. So this is exactly what we should be spending. And so if you're not seeing us exactly on that 67% that's because we have live savings going on in how we're managing our staffing.

The other thing up there that's important to look at is capital projects outlays. The capital project outlays at the bottom uh is at 32% versus 16%. Now, those things are on on in process right now. We, as you can tell by driving around town, we just don't have all the invoices in. So, 32 is a bigger number compared to 16% of budget. We're getting a lot done, but there's also a lot of invoices we don't have. Quick look at positions. As of the end of February, the city had eight positions to fill. Most of those positions will be filled by June 30. the offers have been extended. People are in background checks. Those positions are going away. Last year, there were actually more vacancies to fill at this time. The variances um that that that does cause though does give us some savings, which is what we kind of saw on the prior page. What we're coming in tonight to talk about is we have a couple of adjustments identified now after eight months. We're looking to make an adjustment to the budget to increase the expenditure amount for fire by 305,000, mostly due to increased vehicle maintenance costs associated with the city's outdated fleet, uh, which is in the process of being replaced. There's also some overages due to reimbursements that we have to pay to the city of Monterey for overtime that their fire department works to help us out with ambulance because remember, we didn't change the ambulance override away. So they were helping us with staffing in in between time and also there's incidentals that are have increased such as uh laundry and dispatching. So that's what that is in that fire of 305 city attorney of 140. Additional funds are needed for attorney costs due to extra hours incurred addressing telecommunications issues as well as ballot measures and

labor negotiations. And this is a projection to get us through to the end of the year. Anticipating we're going to continue to run um with some higher incurred salary cost or legal costs because we're we're busy with special things. This is just a forecast though. We don't give them the money unless they actually work the hours. So, it's just ahead of time. Just want to put that all out there. It's not a done deal. Um but you know the good news is is that on the interest uh and investment earnings we have the money to offset that. The city has worked hard to maximize interest earnings including the use of new interest bearing accounts to earn interest on all deposited funds. Interest earnings have exceeded the budget therefore and these unexpected revenues are sufficient to cover increased costs associated with fire and the city attorney.

Can I pause you on that slide? Thank you. Uh when Jamie says the city has worked hard on that, Jamie means Jamie has worked hard on that. She has done a phenomenal job. I want to highlight that in looking at how the city invests its money in in the in the vehicles that we can invested in. So good job, Jamie.

Thank you. But we're still just doing the simple stuff. Um thank you. Conclusion. So uh in conclusion, looking at revenues collected and expenditures to date, the city appears to be tracking against its fiscal plan. Potential areas of deviation in revenue such as charges for services and expenditures such as outside services will be monitored. We're going to keep looking to see how those revenues are going. At this time, adjustments to fire and attorney expenditures and interest revenues are what we're requesting and nothing else. Questions? Oh, I'm done. Are there questions?

I imagine there are. Thank you, Jamie. Nice job. Anybody Anybody have questions? Hans, come on. I have a super quick one. Can you go back to the FT slide? Are you counting us as FTEEs? Yeah, you're working, right? You're right. This we're fulltime. You are full. You're you're funny. You are you are counted as a whole person. Every one of you. We do get paid. So, but as far as um actual hours work, we're not adding that up. Yeah, there is no compensation associated with that five. Fascinating.

No material compensation associated with that five. Um, yeah, that's it's just interesting. It sort of in some ways it kind of just overstates the employee count. Well, to your point, you are in all of the charts and slides. It's an artifact of how we've always done it. So, it's something we can look at. I don't think we should do that either. Yeah. Yeah. I I really I when people think about how many employees we have, I don't I really don't think they're thinking about us and our 37. That's a really good point. Thank you. Any other questions?

I asked mine at at the break and it was about the investments which seemed really good and it turns out it's just really good. I realized Yeah. No, it's just 125% of what we thought. So, that's really good. Good job. Um, public comments, Nancy. Um,

yes. I actually just had clarification questions because I couldn't hear Jamie. Um, on the uh public works, you made some comment about why it was different than what was planned and I didn't understand what you said. It was probably great, but I just didn't hear it. Nova, maybe you want to bring back her presentation. That was it. body. Does anybody online know that before we answer? There's nobody with their hands raised online, so I'll put the presentation back up. It was on expenses.

Mayor, do you want to close public comment and then see if Jamie can answer the question? Any any other comments? No. Okay, Jamie, why don't you come back and answer the question if we can figure out what it was. What I'm actually looking at is I think uh the the main thing we looked at in the area of where we mentioned forestry was revenue. Was it capital? Is that what you Yeah, I think perhaps Jamie, correct me if I'm wrong, but perhaps I think what it was is that Jamie was talking about the fact that uh go to the next slide for me please. That uh we're currently only at 32%

spent. However, we do expect that that's more because there's a lot of work going on out there right now that we have not received invoices for. That's that's perhaps what you heard. Yeah. Thank you. Yep. Okay. Bring it back for discussion. Where do you think it'll be at the end of the year, Jamie? Make sure you're speaking your mic. Right now, do you hear the council member's question? Yes. Where do we think we'll be at the end of the year? Where are we going to be? So, capital outlay. That's all I'm interested in.

So, we're anticipating that we will have a similar carryover this year. And so, what that means is to what we had carried over into this year. So, we carried over about $3.5 million. Those are all done. We'll probably have another three three and a halfish that we might be carrying out. So, but but we I don't know. We've been talking with uh uh project management about this right now. We're trying to refine that. So we'll know more in the next meeting or so.

So when you say we had $2.722 million in capital outlay for from July to February, this is the last line on the chart. That doesn't include the carryover money that we've spent. That does include the carryover money that we've spent. So we think you just told me I I guess I misheard. So, we had $ three and a half million dollars of carryover into the year, right? That's what I heard you say. Correct. Right. And you said we've spent all of that. So, clearly we haven't spent all that because this number here is $2.72 million, which is less than $3.5 million. So, I'm trying to figure out

that was an airtight syllogism. Thank you.

So, so basically, remember this is also as of February. So, I'm kind of thinking in my uh my April May brain. So, we have a lot of invoices coming in at in in the months of March and April because we don't get build till after they've laid all the pavement out and we've made sure it's the right amount. So, that doesn't get paid until we've inspected it. So, so all all those tractors have been driving around really expensive and so we've been seeing those invoices now. So that's why I'm saying that I'm kind of I'm thinking June and I so I'm looking at June 30 and so by June 30 we think all of that will have been realized and paid for and done but there still will be some that aren't finished. So but you're right that's April that's February 28th. So we're probably still just finishing up winter planning. I guess that's a long I guess my question I should have really been looking at Brandon which is are you having um staffing issues and public works that is preventing you from spending all the money?

Well, this is why in the next budget year we're recommending the new structure of our capital improvement team and so we we feel confident being able to execute our 8 to9 million CIP next year. So that was the answer to my question is yes you're having a problem or currently this year that that's why it's not getting done. Yes. That's why in previous years as well we haven't executed all of the plan CIP is because the staffing we believe was incorrect. Okay. Yeah.

Um uh thanks Jamie. Um, this is exactly why I like to see quarterly or um every four month reporting so that we if it's a nothing, it's a nothing, right? We know that. Um, and it really is just to check in, quick check-in, to hear from you. How do you think we're doing? Um, and always thinking ahead to June, always. And so it's exactly what I look for at this time of year is for you to have this but also being saying I'm looking towards the end and here's how we think we will end up. Um and if we don't have and are we going to have any big variances um do you it also seemed like this time last year there were a lot of invoices just sitting on desks. Um, and there's I know there's always a time lag, but that's also disrespectful to vendors. Um, are do you think we've are are we are we paying our vendors timely? the we have been working in recent months to try and reinforce good practices at managing the movement of invoices and not losing them. Um so to help get everybody trained to watch for them and and keep them moving because they do kind of speed up slow down speed up slow down. Um so my understanding would be that there are there are a lot of them coming in after February

but I will say um we we have implemented over this last year using things like docuign much more when processing paperwork and so it has helped a lot to speed up the paper being stuck on desks. I I mean just anecdotally I haven't been getting calls you know last year Chip and I were getting calls from people like where the hell is my money? Um not getting those calls this year for what that anecdote is worth. That's a lot. Yeah, that's good. I mean, we want to be a good customer. Yeah. Yeah. Thank you. Little steps. Good.

So, I have a basic question just tying into what Jeff was saying. So, the 8.4 million capital outlay budget that includes the three and a half million that was carried over forward. No, I don't believe so. I believe it doesn't. That is the current year's budget. Okay. So, I think what Jeff was getting at is how how much are we actually going to do of the new capital that we decided we wanted to do this year.

And that's why this is one of those things where I say that's a good question. Let me get back to you. But, you know, I do believe we are still planning on getting a significant part of that 8.4 done this year that it's all happening right now. So, but I need to find plus plus the three and a half that we carried forward. Yeah. which would three and a half is going to be spent. That would make that almost 12 million. Yeah. So, and there will be some carried out. I know that for certain. So, it's just a matter of how much. I just want to be fair to the public works team because that number is pretty big compared to what we used to do. It's like more than twice as big.

Hey, I'm sorry, Jamie. I'll follow up. We had a conversation for the exactly this reason that our capital budget of 8.4 four is this year's budget, but we also had 3 million that was from previous year budgets, which doesn't show up in the current budget. Going forward, are we going to will we include any carryover as current budget? We will we close out the year and move the new projects into the current budget.

It's an interesting question. The question is is where where is what are we showing? The budget book shows you all the new ask because we're talking about the new money that's being asked for because essentially once you've approved it, that money is gone. And so to come back and ask you for it again is is is not something we want to do. But we do talk about it in the budget book a little bit about fund balance, I believe. Yeah, it's in fund balance. Maybe that's where it belongs. It's just trying to get that conversation out because it's already gone. There's no mechanism to stop those or give the money back. So, so just count that like it's already gone. So, one of the things I would Oh, sorry. Go ahead. You go. One of the things I was going to suggest. Is it okay if I go? Yes. I don't want to lose Can I ask him a question first,

please? I don't want to lose this question because So, Dale asked, so I'm looking at the $ 8.40 million. And so, I thought that, and forgive me for I don't have my budget in front of me. So, did we come into the fiscal year with $8.405 $45 million of capital work that we were going to do or did we come into the fiscal year with $12 million of capital work we were going to do? 12 12 nodding is not the right answer. So okay so we came in with 12. So that was the source of the disconnect when when you when you used that long word

um when you use that long word before. So what would help me in understanding this chart and I would I will ask you to do this next time is that all the the first four lines on here from salaries to debt service are all current fiscal year. Like it's easy to imagine that they're all fiscal year, but I'm confused. I was confused on the capital outlay and I think there should be another line for last year's capital outlay that was carried forward.

So I think you should track that. I think you should track that differently and I would expect that number percent dispersed to go up to 100% at some point during the first or second one of these reviews over the year because that would clear up like the the confusion that I had. Likewise, if you if you take the dispersement side of it, is that dispersements only for items that we budgeted for this year or are you pay does that include items you paid from the 3 million from last year? that which was the source of my confused double confused in that case. Yeah. Let me let me make sure that that's correct that that that that should be all of the spending. So you're right. It's makes it even more confusion. Yeah. Yeah. I

I mean you really should probably say here's how much we've spent of the three and a half million that we had budgeted for last year and here's how much we spent for projects this year because that's really telling us that you're getting the things done that we wanted that we made a decision to do. Yeah. So, put it on two lines and and basically we just show here's last year's capital projects, budget, actual, here's this year's capital project, budget actual, and then you can see it cuz then you then you see what's actually going on on the ground. We track it by project and we can tell you exactly what's happening with every single one. That's really good. Thanks for bringing that up, Jeff. We don't agree.

Well, that actually the other question I had was like as part of these trial reports, would it make sense to have something that just listed the CIP projects and just an update on kind of which ones have been done or where they're at? Especially since that's the focus of our new spending. Yeah, I mean we totally could I was just thinking see we kind of covered some of this. This this I already have it online. Yeah. But I think to the council member's point, we can make that like this is this is new cloth for us. Like this is the first year we're doing this is great feedback. We'll just know next year

part of the trianual triannual is the CIP and including the second line. So this is great. Thank you for the feedback. Any other comments? All right, great job. Thank you very much. And thank you stewardship committee and staff for uh for getting us down this path. we need to uh do resolution 2026-027.

So, no, no, no. We're going to I'm going to clarify that for you. So, we we brought the resolution in case there was any major changes um because we're going to need we're going to bring it back to you next month to actually adopt it. Today was just to receive a report and discussion, but that's an attachment in case we had to make any changes to it. So, we didn't make any major changes. It wouldn't require changing the resolution. Uh you're if if you notice the action tonight is actually just to receive. I did. I thought you I thought it was I thought there was a disconnect between the staff report and resolution. Yeah, that's what I thought. So we'll come back next month for adoption. We should have explained that better. Okay, I think that ends item 11. Brian, do you want to take us into close session?

Yes, we have two close sessions. One is the public employee performance evaluation pursuant to government code section 54957. The title is acting city administrator. The second item is a conference with labor negotiators pursuant to government code section 54957.6. The agency designated representatives are listed in the agenda as is the employee organization.

All right. Thank you. Anybody public comments? Go ahead. Thank you for everything this evening and um Nancy Tumi again and I would just like to offer my comments about your review of the um the acting city administrator. He's a good guy. We need what he does. We need his energy. We need his passion for this city for making relationships that work, working through the difficult moments. And there have been difficult moments for sure. Um, and we don't we're not always on the same page, but we can disagree. We can disagree civily. Um, yes, balls get dropped occasionally, but he's got a really full plate. Um, so I understand that and want to offer my personal support for his continued employment in this role. Thank you very much.

Thank you, Nancy, and thank you for being here tonight. All right. So, now we're going to recess into close session and we'll be terminating the Zoom session.