City Commission - Regular Meeting

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I call this Tuesday, July 28, 2026, City Commission meeting to order. Will you join me in a flag salute?

I pledge allegiance to the flag of the United States of America,

DJ, would you lead us in a prayer tonight?

Loving God, we pray today as you send your Holy Spirit through us in our decision-making and our convenience to work together for the better good in your grace, with your will, and with a desire to make the world and our community a better place. We pray that you guide us through our steps, our decisions, and our communication throughout everything that we do as it comes before us. In your name, we pray. Amen.

Thank you. All right. Open the meeting to public input. If anyone out there would like to come up and speak in public input, state your name and address.

Hi, Roger Lomchek, 1147 South 220th Street. I guess we're kind of doing this out of order if the budget's going to be presented this evening, but obviously property tax is an issue that's near and dear to everyone's heart. And I guess I just wanted to ask the question in advance, are we going to see an actual reduction in the dollar amount of taxes people are paying? Could you say that again, Roger? What are you asking for? Is the amount that people are going to pay in property taxes for the city share going to be reduced?

So the intent of the commission, I think we've all spoken throughout the last several months for our budget hearings, is to reduce spending and to reduce the mill levy. And that is the intent. I haven't seen the budget fully yet. I know that's what we've been working towards.

You may be aware of this. Simply reducing mill levy does not mean people will pay less in taxes because of the inflationary situation with values continuing to climb. It's really easy for reduction in mill levy to still result in higher taxes being paid. And I guess that's part of my point a year ago when I came to you.

Roger, you realize we don't control the appraised value of things, right?

I understand. But what every elected body does control is the budget that they choose to set and submit to the county clerk for the clerk to take what money is needed to meet that budget. That was the issue last year when a budget was set based on incorrect valuation numbers. or incorrect assessed valuations and then ended up having to raise the mill levy to make up for that. Something that all of the elected bodies absolutely have final say on is how much you're gonna spend and that determines how much money is gonna be taken in property taxes each year. I guess that's my question, whether if the mill levy is simply reduced back a little bit from where it was last year, even if it's back to where it was last year, that's still gonna result in a net increase in taxes paid compared to a year ago.

Well, like DJ said, that's certainly, I'm not going to speak for my fellow commissioners, but I think after the last several months, I think it's clear that's our intent. And I think the city manager and staff know that as well. So without stealing their thunder, without even submitting the budget officially yet, until later on in the agenda, I mean, that's the only answer I can have for you right now is that, like DJ said, it's certainly our intent.

Okay. I guess we'll see what the numbers are. Okay. Thank you very much. Thanks, Roger.

Does anyone else like to come forward in public input? Seeing none, I close the public input portion of the meeting and move on to consent agenda. Are there any items to be removed from the consent agenda?

I have a question about item D. D?

All right. Excluding item D, is there a motion to approve item A, B, C, and E, and F?

Go ahead.

You can move to approve. Second. It's been moved and seconded. Roll call vote.

Brooks. Yes. Hite. Yes. Munsell. Yes. Perry. Yes. Ziegler.

Yes. All right, item D, approval of staff recommendation to accept an emergency solution grant from Kansas Housing Resource Corporation in the amount of $106,525 to support homeless services within our community for the grant period of July 1st, 2026 through September 30th, 2027 and authorize the mayor to sign the necessary documents on behalf of the city.

Hi, good evening. Not going to answer any questions.

Perfect. So just a couple of things. I know I asked you before about this grant and the process of it. Is there a point where we can get a back brief on the exact amount? I know we can't give us all the information on who it's being used for and how, but can we get some type of a back brief on?

Like the spreadsheet that I gave you guys the last time?

Similar to that. That's a lot of good information, but just a, I guess it's not so much, I don't want to use a fring, the frame exactly where it's going. But just more information on how it's being funded or how it's being disseminated throughout each quarter. I need to sit down with you, though, and look at maybe some options. I know I gave some examples last time, but I haven't seen any additional information provided. So it's just for the Commission to have a better idea of how the money is being distributed, not just solely off how many families it's affecting, but regional, part of the city, I guess the beans and bullets of it. Okay. I'm not sure how much you can release, but I know it's...

Okay, so these are HUD-funded money that came through the state Kansas Housing Resource Corporation, and then we apply for them, and then we are granted that money. And then how those funds are used is rapid rehousing, which is helping those that are literally homeless. So how those individuals are chosen is they do a homeless certification, and then they do an assessment. And so that assessment determines how likely they're going to die if they're still on the streets.

The urgency.

Yes. And then when we do, we do case conferencing every Tuesday. And then if we have funding, the top individuals, because they're scored, so those top individuals get referred to programs that are open. So like in my case, they would be referred to... the city and then we would contact them and help them get housed. Is that kind of what you're looking for? Okay. And then as far as the homeless prevention side, that is helping individuals that are about to become homeless. Like they're, you know, like a single parent and a child, they're about to be evicted. They can come to our office, provide the required documents, and then we can help pay their back rent and then rent moving forward to keep them housed so they don't become homeless.

And that was a big chunk of how you briefed it last time, too. The question I'm looking at, I guess to narrow it down, is the actual information, if there's reoccurring need for the same individuals, is the grant pushed off of and requested off of the need by a roster that when people apply for this, or is it off of, what numbers are you using to?

It's off the assessment that they're getting.

So the sole information is off them coming in and requesting it? Yes. Okay.

Yes.

And then as far as the reoccurring use, that information would be helpful too.

Reoccurring use, I mean, our goal is to keep them housed. But I believe Cheryl asked this question in the past. If they continue to use it and abuse it, we won't assist them any longer, whether they need it or not. I mean, the goal is to keep them housed. There's a point where if they're abusing the assistance and not doing what they need to do, I mean, we can't continue to use money on them and use that for somebody that will do what they need to do. Does that help out a little bit, too? It does.

Okay. And then the last part is the, I guess, the window. If you're... on this list you come and they do an application, how much time it takes for them to qualify and get on this for use? Is that still over a year?

No, the year is our Section 8 waiting list. That's where the year comes from. This, if they do the homeless certification and get on the list, it just kind of depends on who has money available. Typically, I run out of money quite quickly because it's not a lot. This year we did receive more because of the great job that our office has done in the past couple of years. So we did receive more, but it just kind of depends on A, how active the individuals are to find the housing, because we can't find it for them. We can assist them in providing landlord lists and things like that, but it's depending on how active they are on doing the work and then keeping in touch with our office. And that's through different, I mean, service providers. You'll hear from a group today that really helps also. So just different providers trying to, you know, we all work together to get these individuals housed.

Trying to get it figured out. Okay.

So, yeah, so it's not a year by any means.

So it's less than a year after application.

Yeah, I mean, like some of them, they come if I have funding and they kind of already have a place kind of lined out. It can just, you know, take maybe a couple of weeks to get them. through our process of the inspection and landlords correcting and going that way.

Is that your total funding, $106,000?

That is the total ESG grant period, yes. Do you have other funding? Yeah, that's just the ESG grant, yes.

Yeah, but I'm saying, do you have other funding other than the ESU grant?

We have our TBRA that we're going to apply for, and then we have our Section 8.

Okay.

Yeah.

Do you have a list going into right now with this approval? Yes.

A list of individuals that are needing assistance, yes.

What's the cap per person or family?

So our assistance, like how many months we help them or how many times we help them?

Well, 106 is going to go fast.

106 is going to go fast.

So that's why I'm saying, is there a cap?

So typically in the past year, I've helped at least between Nine to 10 to 12 people, so I try to keep it within.

Nine to 10 to 12 for 106.

Well, that was less. That's what I used last year.

But the needs of the many are going to outweigh the needs of the few as far as the dollars here.

Yes. So I do what I can to screen what I can. We take the highest risk as much as we can for the rapid rehousing. So I do my best to do what I can.

That's why I wondered if there was a cap. That way you could spread it out a little more.

So we do short-term, so that's where the cap kind of comes up. So there's short-term and medium-term. Short-term is three months of rental assistance. So then that way we can basically help them in.

A lot of times that's a lot of money for, I mean it ends up being quite a bit of money.

Yeah, but that's why we have the security deposit program too. So that kind of helps alleviate some of that money being spent in ESG is to help with the security deposit and then the ESG funding is just helping with the rental part of it. Does that make sense? Yeah. So that's kind of where the cap is we do short term.

And this is by the year?

by a fifteen-month period, yes. Fifteen months, wow. Yes.

You guys are doing a good job of obviously being good stewards with that money, and like Cheryl said, you know, a lot of need, but not a lot of money there, not a lot of dollars, so we're thankful that for you guys taking that serious and being, like I said, good stewards of it. Clearly, they wouldn't increase our money if they thought we were doing a poor job of it. Appreciate your work.

Thank you, I appreciate it.

The only other question I have, I'm looking at the match certificate form and the third block down under the match category for staff salaries. So the amount requested is $40,611. But the amount of match is $73,930.

So that is basically a little bit of a portion of everybody that touches ESG. We can use a percentage of their salary to match towards the grant. Does that make sense? So like my office, if anybody in my office touches ESG finance, they do the payments. So we can take a portion of their, like a percentage of, small percentage of their salary, IT because they help us with if we have any computer issues. So it's all categorized into that. So that's where it may look higher, but that's how I do my matches. It doesn't have to necessarily match the amount requested. It just has to match the total amount awarded.

Yes. Okay. Yeah, I just saw the difference in there, and I didn't understand why.

It does look a little bit weird, but as long as we have the total amount match requested or awarded, then we're fine.

So this $106,000, do you apply for more money in this grant, and that's what they decide they're going to give you?

Yeah, so I actually applied for $196,000, and we were awarded $106,000, so yeah.

and because you're doing such a good job, it goes up a little bit.

Yes. So the last few years has been pretty much the same, and we were told, because I asked why we got a decrease a few years ago, and more agencies have been applying. But now they, the last year and this year, they're making it more competitive. They're looking at the outcomes, and we do have great outcomes, so that's why we were awarded additional funding this year.

Good, good, awesome. This isn't the only entity in this area that has money. That is correct. You have Catholic Charities and all these other people.

Safe House receives, yes. Yes. I have a list of all the different agencies within the 12 counties around us that have this funding as well.

Well, we definitely appreciate all the hard work. I know there's a lot of juggling, and I didn't mean to put you on the spot tonight. No, you're good.

No, I love it. This is what I do every day.

She knows her staff, for sure. I do. We appreciate you. Yes. And your staff. Tell everybody thank you.

I will. Thank you. Motion to approve. Second.

Moved and seconded. All in favor say aye to approve item D. Aye. Aye. All opposed, same sign. Motion carries. Thank you. Special presentation. IMA representatives from IMA will present information regarding the city's health insurance program.

Mayor, commissioners, we have Christy Powell and Nick Johnston and everybody knows Tim. And we are self-funded, so we have IMA. We don't have a Department of Benefits. We do have a division in HR that helps with our benefits. But we really rely on IMA and have for a long time to help us determine what's the best level of health care that we can give to maximize our dollars. So they manage it every year. They meet with us every year. They usually present every year. And this year, they are here to present again. So, Kim, I didn't want to trump you, but... I didn't see you standing.

No, I was going to do a quick introduction, but Darren just did it for me. So I'm going to go ahead and let Christy and Nick take it away, and I will stay up here for any questions.

Thanks, Kim. Thanks, Darren. Well, I'm Christy Powell. Thanks for having us. As Darren and Kim said, we're going to do some quick updates for you guys. Where you're at historically from a plan performance perspective, looking forward on where we're at from a budget perspective, and obviously some requests and some tweaks that we're going to be asking for the coming years. So this is really the Nick show, so we'll let Nick take it away. But I'll be here for questions as well. But Nick is your client executive. He's very much in the lead on all of the financial details, so Nick, this is Nick's masterpiece, so we'll let him run with it here.

Yeah, thank you, Christy. Starting off, wanting to really look at where the health plan has been. And so you'll see on this chart, we're looking at dating back to 2012 up to 2025. That was the last full plane year that we had data on. And so you'll see two lines on this chart. That dark blue line is looking at where costs have actually been. So this is what the health plan has actually experienced. And you'll see in that 2012 to 2023, 2022 timeframe, health plan costs have stayed right around that $2 million mark, which is really pretty incredible with what we have typically seen in the health plan market. There has been a rise in 23, 24, and 25, which we'll get into here in a little bit. But when I look at this, you'll see that dotted blue line just above that. And that's looking at healthcare trend in that same timeframe. And so this is really comparing had the city of Pittsburgh health plan ran at trend, like what we're typically seeing, this is what health plan costs we would expect. And so you look at 2025, that number's up to 4.5 million compared to actual costs that were at about 3.1. And so really the main bullet point or highlight I have on here is looking at from 2012 to 2025, that's about $12.7 million in savings versus trend when we look at what actual costs have been. And so that's something that compounds every year, right? And so that's about $905,000 annually. BETTER THAN TREND IN THIS TIME FRAME. ON THE NEXT PAGE, WE REALLY WANTED TO KIND OF FOCUS IN ON, OKAY, SO 23, 24, AND 25, WE ARE SEEING AN INCREASE IN COSTS. SO WHERE IS THAT COMING FROM? YOU WILL SEE A BAR CHART WHICH BREAKS OUT ALL THE DIFFERENT HEALTH PLAN COSTS THAT MAKE UP YOUR PLAN. And so you have certain administration costs, you have certain stop loss premiums, so that stop loss insurance is a way that protects the city from really catastrophic claims. And then you have the claims themselves that the city is paying. And so when you look at this chart, really all of the bottom line items, so your medical admin, dental claims, stop loss premiums, those have all stayed relatively the same. There have been increases, but moderately. Where you'll see the biggest jump is that top bar chart, which is medical claims. So in 2023, for example, that was at 984,000. That did jump up in 24 to about 1.8 million. And then in 2025, 1.5 million. And so when we look at where is this increase coming from, it's mostly on the medical side. There was also a jump in pharmacy claims in 24 versus 25. You'll see that went from about 600,000 to 812,000 in that one year. We have some additional data on that on the next slide. And so since we kind of targeted that, it's claims that are causing the increase to the health plan, really wanted to dive into those claims itself. And so when we look at a health plan, there's really four main buckets. You have your inpatient claims, your outpatient claims, your office visits, and then pharmacy claims. And so we really broke that out in each year in 23, 24, and 25 to show you what claims were falling into those buckets, as well as showing you what our commercial benchmark data is there as well. So you can see what, for a group year size, what we would typically see in claims utilization. So in 2023, for example, there was 362,000 in inpatient claims. For a group year size, we'd anticipate that number to be closer to about 532 in that respective year. So the health plan, despite some of the recent increases, is still well outperforming what we typically see for a group your size. There have been some kind of one-off situations, in particular in 2024, you'll see a very large increase in inpatient claims. This was a pretty rare situation, and really due to HIPAA purposes, I don't want to get into the nitty-gritty of kind of what went on, but there was a high-cost member on the plan with a pretty catastrophic claim that really caused that to jump in that one year. You'll see in 2025, inpatient claims are back down to about 350,000, so really where 2023 levels were. One other piece I did wanna call attention to was pharmacy. I touched on that briefly. In 24, you'll see that was at about 600,000, which jumped up to 813,025. That is really being driven by GLP-1s, and so I'm sure you all are aware of GLP-1s. You'll see stuff on commercials and celebrities talking about it, but those are your Ozempics and Will Govees and those weight loss drugs. And so, The health plan was actually covering those for weight loss medication. That jump alone was really driven by that one piece alone. And so moving forward, you know, in 2026 and beyond, members can only fill those GLP-1s for diabetes use only. They're not allowed to fill those for weight loss management.

That's what I was going to ask you. Those medications, yeah, that's for diabetes, and that's doctor prescribed, but... Are they going to the doctor and doctors giving them medication for weight loss?

That's a great question. And so there are guardrails put in place to where you have to get a prior authorization from your doctor that says this is for diabetes use only. They can't fill it for any other reason. So they have to get a doctor's note in order for the health plan to fill that for diabetes use.

But it sounds like that's what was happening, wasn't it?

In 2025, it was really open for weight loss.

Yes.

And so per the FDA, I think it's if you had a BMI over like 30, you're eligible to get it for weight loss. And so members were able to do that in 2025. In 2026, so now and beyond, it's only approved for diabetes use.

Well, I'm not a doctor, baby doctor. Sigley can answer that, so... If you're taking a medication for diabetes and you're using it for weight loss, is there any long-term effect because you're using it for something else?

No. If you're taking it for diabetes, it's for diabetes. And if you're heavy and you're a diabetic and you're taking it, then you might lose weight. But most of these GLP-1s and 2s are for diabetes itself. Right. So if you've got an obese person who's a diabetic, and a lot of obese people are diabetic, you get the benefit from the drug if you get it prescribed. You get double benefit from it. Yeah. So what you're saying is it can be used for diabetes, but not for weight loss. It can be, right? Yeah.

Right, they have to have a diabetes diagnosis from a doctor itself in order to fill that medication. It's been recategorized as cosmetic at this point.

That's a level one diabetic too, an insulin-dependent diabetic.

Yes.

There's not that... There aren't hundreds and hundreds of thousands of people on insulin in this country.

Right. And so when I looked at the health plan data, there's really... So your Ozempic is still only used for diabetes use, but what's FDA approved on the Ozempic side would be the Wolgovi. So that same active ingredient in that drug. And so... When we looked at the number of claims that were filled for Wigovi, which is purely for weight loss, not the diabetes portion, that was $284,000. So when we look at what the healthcare was spending on those filling it just for weight loss, not for diabetes, it was that $284,000, which almost explains to the T why pharmacy claims went up from 600,000 to 813.

Kim, didn't you used to have a program for healthy employees? What was the name of that program?

So we do have a wellness, is this on?

Yes, wellness program.

Yeah, we do have a wellness program. We do different, obviously that's part of our golf program. We've got walking programs that we do throughout the year. So we do have different wellness options.

Do the employees have to sign up for that or do you just offer and you ask them to come? It's not mandatory, right?

It is not mandatory, no.

So if they're losing weight from these drugs, Wouldn't that make them healthier in the long run? Maybe they lose the weight and then they feel better and maybe they're on the right path. Maybe it would offset a...

Some of it, but not, yeah, right. And there's definitely validity to that. And there's a lot of studies that have come out. When you look at the upfront costs of these prescription drugs when they run through insurance, it's about $1,000 to $1,300 a month per fill. So the question is, will medical costs for that member go down by that same amount? And we just haven't seen that from an ROI perspective.

And are you negotiating the price of the drugs? Are we able to do that?

So, yeah, we actually, one of the things that we did do is go out to bid this year with your prescription drug manager. So that's their responsibility is the PBM. You guys are on a 100% pass through contract. And so what that means is exactly what those PBMs are getting for those drugs, they're charging the health plan exactly that. So they're not doing any spread pricing. They're passing along 100% of the rebates back to the health plan. And so that's one of the things that we want to make sure you are with the 100% transparent PPM.

A lot of times, you know, you can get RX.

Yeah, and then that's another component.

Or there's coupons online that you sign up for a program. So that's why I was asking. And I know that program she was talking about was.

Yeah. This number covers employees as well as their families that are covered in the program, right? That's correct.

So we're looking at employees, spouses. It could be children that are on the health plan. Yeah, total members. YEAH. SO ONE THING I DID WANT TO TOUCH ON BRIEFLY IS JUST FROM A BENCHMARKING PERSPECTIVE, BOTH FROM A PLAN DESIGN AND CONTRIBUTION STANDPOINT, HOW CITY OF PITTSBURGH STACKS UP. AND SO WE REALLY HAVE TWO DIFFERENT BENCHMARKS HERE. YOU'LL SEE ON THE LEFT-HAND SIDE, THAT'S OUR KANSAS BENCHMARK. SO THAT'S REALLY JUST THE KANSAS COMMERCIAL BENCHMARK. IT INCLUDES PRIVATE, PUBLIC SECTOR, ANY SIZE GROUP. And you can see, just for an example, individual deductible is $1,500, the city plan is $500. So anything in green indicates that it's better than benchmark. Anything in that reddish shade means that you're above or maybe slightly worse than benchmark. And so I won't go line by line here, but you can see a lot of green on this slide. So it's a very competitive, rich health plan, both when we look at the commercial benchmark And the Kansas public sector specifically, very rich there as well.

Kim, how often do we brief this to the employees and their families? How often do they see this information and know, is it just when they come in or is there...

So we talk to a lot of the employees one-on-one when they come in about things. We, at open enrollment in October, go through all the plan design, which we're going to do again this year with IMA because we've got some changes that you'll see here coming up. So IMA, we've asked them to come in and help us go through that with the employees. But anytime there is a change, which we only make the changes before open enrollment, so this time of the year, So we brief them then, and then when we get new hires in, brief them on the plan. Since we are self-insured, it's important that employees understand the plan.

It's a lot of information to take in, and especially if they don't need it for a long period of time, and then all of a sudden do, they need to know how it works and what's going on.

Is the money taken out prior to the pay, or is it taxable? Or do you have it as a line item on their check? Or how does that work?

For their insurance? Yes, it's taken out each pay period.

On the gross?

Pre-tax, yeah. Pre-tax.

Okay.

So Kim alluded to this earlier, but the city is a self-funded health plan, right? And so what we wanted to show was in 2023 through 2026, year to date, how the budget has compared to actual costs that have occurred. So you'll see on that first slide from 2012 up until this point, really cost of state at that $2 million mark. But unfortunately, with the rise in health care expenses, we have seen a decrease to the overall health reserve. Because of that, you'll see in 23 about a $2 million surplus in that reserve, which dropped to about $1 million in 24, 25, right around $100,000, and then we are showing the 2026 period running at a deficit of about $600,000 in the 2026 period alone. So one thing we wanted to project forward is looking at how the health plan could potentially finish and give you a projection on that year end results. And so we have all the different cost components of the health plan broken out here. You'll see what's highlighted in that top portion is actual costs that we have seen up to date through May. From June through December, there are some illustrative costs shown there. So we have your fixed costs, which we know pretty certain what those are gonna be on a monthly basis, because those are a fixed cost, they just change a little bit as enrollment goes up or down. But really it's gonna be around that $62,000 mark a month. THE MEDICAL CLAIMS BASED ON WHAT WE'VE SEEN HISTORICALLY ON A MONTHLY BASIS. THERE'S GOING TO BE SOME MONTHS WHERE IT'S HIGHER THAN THIS AND SOME MONTHS IT'S LOWER, BUT JUST FOR ILLUSTRATIVE PURPOSES, WE'VE KIND OF SET IT AT AN AVERAGE. AND SO COMBINING ALL THIS TOGETHER, WE WOULD ESTIMATE THE YEAR END TO FINISH AT ABOUT AN $800,000 DEFICIT, UNFORTUNATELY BASED ON HOW SOME OF THE CLAIMS HAVE BEEN RUNNING IN PARTICULAR THE LAST YEAR OR TWO.

Were you able to see that the deficit was going down over the last couple years? Okay, but why were we not talking about it then, the deficit coming in there? Where would that money come from? Like back in 25, if you were getting close to being depleted, wouldn't it have been a dire need at that time? Because now you're just like down under the line, so. And you're talking over three quarters of a million dollars.

We are totally at the mercy of our claims. When I got here, there was less than $100,000 in this fund. We built it up to $2 million over nine or ten years. But one of the claims, if you look at the bar chart a few slides ago, one claim took $800,000 of savings. So that in and of itself, you know, we know about it and we look at it and we think about it, but we still have reserves. But when the next year's claims, you have six or seven claims that all hit at $90,000. Right. So, I mean, it's just...

But does that reserve money that we have other than this ever flow into this?

Well, that's what this next chart's about. That's why we're bringing it up to you today. And remember, it's a projection. It's July. So they've gone ahead and projected out the rest of the year. It's like anything.

You go along and you can be fine for a long time.

Somebody may have a heart attack today, God bless them, and we're dealing with it. We've watched the total. We've watched it go up. We've watched it go down. And we're telling you today that it's not only down. The big question, I think, today for the takeaway is, what's the trend? Is this too bad years, or is this just the new medical costs that we're going to need to cover? And that's really what we're going to bring to your attention today.

So is there an additional... like a catastrophic additional plan we could look at that would assist with these higher claims when they come in like this? Or is there something else we can do other than just react?

Yeah, so that is in place today. That's that stop-loss insurance I was referring to earlier.

That's the only thing that's out there right now?

Yeah, so it protects the city for up to $100,000 per member. And so that's kind of that deductible that anything over that, then the stop-loss carrier picks up any of the claims. THERE WAS THE ONE INSTANCE WITH ONE INDIVIDUAL THAT UNFORTUNATELY IT WAS A DRAWN OUT PROCESS TO WHERE IT HAPPENED OVER MULTIPLE YEARS ACTUALLY FROM WHEN IT INCURRED AND IT FELL OUTSIDE OF THAT STOP-LOSS PERIOD TO WHERE THEY COVER THAT. THERE WAS NEGOTIATIONS GOING ON WITH THE PROVIDER AND IT WAS JUST A VERY RARE ONE-OFF SITUATION TO WHERE THAT REALLY HURT. Normal basis, any member, once they exceed $100,000 in claims, the city's done paying for that member.

What is the percentage, if it goes into the catastrophic category, what's the percentage that they pay? So anything, once it hits $100,000, they pay 100%.

After that? Yeah. So a $600,000 claim, it only costs $100,000. And that's what I was alluding to, to where this was that one-off scenario to where it actually fell outside of what they'd consider the stop-loss period to where they'd cover those.

That's where I'm circling back to now is, is there something available out there that would protect the city after in case in these cases where the stop-loss doesn't apply because of the, so does it protect the city or the employee?

It's the city. And there is another stop-loss contract. That's a little bit richer that we could buy. We weren't, We've increased your coverage over the years to be more what we would call mature, but it comes with a cost, and so we've always been trying to balance fixed costs with the exposure. This one particular claim came in when the No Surprises Act became into effect, and that's probably too much in the weeds for you guys, but it was new legislation that came into effect that allowed the provider to negotiate 24 months out past the time that the claim was incurred. So it was really a perfect storm. We didn't really have any way of knowing that was going to happen, and the city was well aware that there is stronger stop-loss contracts, but we just didn't need them at the time. But now with this new legislation, we're looking at a stronger stop-loss contract for this upcoming renewal, just so there's no surprises. But your team is looking at claims on a monthly basis. We weren't watching this. We knew it was happening. It was just truly a perfect storm with the legislation that came out in that year.

So if the stop loss is $100,000, maybe it's too soon to ask, but what would you recommend that that go up to?

The stop loss limit at $100,000 is the right amount. It's the coverage type that I was just alluding to. So looking at basically kind of having a gapless stop loss contract to where there's not a tail that runs out on incurred and paid.

So you said something's happened over multiple years. Is that correct?

There was one claimant over multiple years of negotiating.

One claim. So it's $100,000 per year during that multiple claim.

It was a $600,000 claimant. Per claim. That was incurred and paid out past the stop-loss contract.

The thing you're missing, and this is confusing, so the stop loss doesn't really come in hundreds, 200s, 300s. It comes in months. So the 100,000 is the cap because most of our claims are well under that. But you can have a 12-12, which means anything in that 12 months is going to be covered. We moved to a 12-18, I believe, years ago, which means...

When we took you over, you were a 12-15, which means you had three months of run-out coverage, basically. We moved you to a 12-18... gave you eight months of run-up coverage, which was more than you ever needed. You never had claims that went past that. Then this claim obviously went well past the 18 because it was the No Surprises Act that the provider was negotiating on the bill because it fell into an emergency category where it allowed them to do so. And again, a very, very unique claim that we can't really talk about because of the nature of privacy.

But it's, yeah, that's the nature of being self-insured is we're paying the bills.

But you're never leaving the employee. Oh, no, no.

The employee wasn't, this was all employer related on the claim liability. Absolutely. The employee got the coverage they needed. That all was taken care of.

And I didn't mean that we were depleted. I mean, I know it was depleted, but a lot of times you have money sitting to the side and it funnels in whenever it gets to a certain point. It'll take a while to build it back up to where the $2 million was before, but that's in a perfect world when nobody gets sick. And that doesn't happen anymore.

And we always are balancing how much to have in that reserve account too, right? We're not trying to overfund this. We're trying to keep it in a healthy balance so you guys can use that money for other initiatives, right? We're trying to make this... Everything that we do in our business is very much a balancing act of we don't want too much cash in there. We need enough cash. But this was really a perfect storm.

Shouldn't there be like a million?

Two and a half, three months of claims is ideal.

Oh, is ideal? Two and a half, three months. Okay.

And where we're at right now is... This next slide is going to show you that the program month-to-month right now is not in balance. It was a couple of years ago. And so part of the imbalance, a lot of the imbalance, are adjustments to the plan that we've already talked about, RX and things like that. But the other part is, are we going to have huge claims? And if the claims go back to how they've trended for 10 years... We don't want to overcharge the employees and put more taxpayer money into the plan and build up another huge balance that we can use to do other services. So the whole thing just chases. We've been very lucky for eight or ten years. I wouldn't say unlucky because we're taking care of our employees. And if somebody has a million-dollar claim and they work for the city of Pittsburgh, we're going to take care of it. But we need to make sure the plan is in balance every month so we can build a small deficit and over the time hopefully build a bigger one.

So next section is going to be like, what are we doing about it? How can we kind of get back to balance, right? So that's the next, as we wrap up here, what we're going to share with you guys on some of the work that we've already been doing with the team here.

Yeah, so this slide looks in particular at the medical network. What we did is we went out to bid, you know, today that is through providers care. And so one of the things we wanted to do is go out to bid, make sure you all were getting the best discounts possible with the best access for your employees and members that are on the health plan. And so PHCS is what the best network solution that we found was. They were projecting. So what they do is what we call a claims reprise. So they looked at the last 12 months of claims. Had the city have been with PHCS during this time, what would have cost been? And so they looked at about 370,000 in network savings just by deeper and more competitive discounts through their network than your existing provider's care network. And so there is that savings piece of it, which is pretty significant. And then the other piece is whenever you change networks, there is going to be a little bit of disruption with some of the providers that you can see. And so they did do a full disruption analysis. And we have that highlighted on the bottom right-hand section. Really, there's two that jumped out to me in the sound physicians emergency med and then the Crawford County Mental Health Center. But every other, if you don't see a provider or a facility on here, that means that it would still be covered. So those two are the two that jumped out to me with about 16 members that have utilized the Mental Health Center and then 31 in the Sound Physicians Emergency Med. And one thing that we can do kind of proactively, which we've already actually done, just in case that the city would like to move forward with this option, is let's try to just get them in network. That way that, you know, 1-1-2027, these providers would accept that PHCS network solution.

Is that Sound Physicians Emergency Med, the emergency room, is that right? Yes. Visits to the emergency room?

They're the outsource ER.

Doctors. Yes.

All right.

So the important thing is they've already reached out to both of those double-digit members and said, can you be part of this network? So we're pretty confident that if we made that change, not only would we save the 371, but we'd also be down to under 10 individuals that didn't use a provider that would have been in that network. And that doesn't mean they don't have other options. It just means we didn't want to. It's just not all about the money. We've got a lot of employees. We're a four-states corner. We've got people that go to doctors here and there. We want to make sure people can keep their doctor if they want to, but it's just very hard to do when you change plans. But for that amount of money, we probably need to change plans because we're obviously out of balance.

So the oversight network, if it's not on this list, will still be normal for all the employees and their families?

Yeah, so 94% of the claims they reviewed, they said, yes, that would still be in-network with us today. So a large majority would still be in-network, and really the majority of that, you know, 5% or 6% is coming from those two providers that we talked about. If we could get them in-network, it would be great. What do the negotiations look like for that? We're working through the vendor themselves. They have their own network team. That's their job. Every day they reach out to these providers and facilities to try to get them to join the existing network.

In a hospital setting on an ER, you never know sometimes if somebody is in the network or not. They may have treated your city employee, but they're not in the network. So what happens then?

So that's actually the good thing about the No Surprises Act that Christy was alluding to earlier, that unfortunately we have that situation with the large claimant. But one of the things that that bill did is if it's an emergency claim, whether they're in-network or out-of-network, they have to charge the health plan that in-network rate. Yeah, so that was actually, yeah.

I wish that was that way for everyone.

It's only for emergency care, but yeah. So that's, yeah.

And the hospital itself, as you know, is in network. It's just this contracting group, this Sound Physicians is contracting the ER docs locally, and that's why it's falling.

But sometimes the information that the hospital has on their computers is not transferred over to Sound Physicians because we recently had a problem with that, and they had a self-pay, and when the The person had insurance, so that's why I asked that question.

It's a very convoluted industry that we work in.

I was going to say, one person in her office would be mind-blown doing that every single day. We do. Trying to keep track of every single claim.

All the time. Yeah, thank you. We do that every day with employees, and they have an amazing team that we can send those bills to, and they help resolve them quickly. So another great service provided by them.

You can never assume.

THAT'S RIGHT, YEAH. ONE OTHER PIECE THAT WE DID WANT TO LOOK AT WAS THE PLAN DESIGN. AS YOU ALL SAW ON THAT BENCHMARKING SLIDE, THE CITY'S PLAN IS WHAT WE CONSIDER A VERY, VERY RICH HEALTH PLAN. UNFORTUNATELY WITH JUST THE INCREASE IN CLAIMS COST, ONE OF THE THINGS WE WANTED TO LOOK AT WAS MAYBE TWEAKING THAT PLAN DESIGN TO A LITTLE BIT CLOSER OR AT PAR WITH THAT BENCHMARK. Still a very competitive plan design. I mean, a $1,500 deductible is really standard in what we kind of see in the market. Bumping up that out-of-pocket a little bit, some of the co-pays you'll see in that bold and blue. But making these plan design changes, what we'd estimate is about $210,000 in annual savings by making these recommendations on the plan design.

So you're bumping the deductible and the out-of-pocket up or down?

We have to bump the ones that are going to have an impact. Unfortunately, those are the higher dollar ones. The people that aren't using the ER, there's a lot of people in our plan. The idea is to adjust the plan so the people that are the most expensive, unfortunately, are having to pay the most because we're all We're all looking at 1% and 2% and 3% raises every year. We need to make sure that we're not just eating up the raise on, hey, everybody's got to pay 40% more. But it's tough to go through here and pick out what you want to increase, but we spend a lot of time trying to determine what's going to get us a couple of hundred thousand dollars, because that's what we're going to need to balance the plan. But it also is good to note that Years ago, we probably had these numbers. And with the help of IMA, and we started to build up our reserve hire, we were able to give a real big benefit to the employees and lower some of these. But it looks like it's time to go back.

And employees can opt out too, right? Correct. Sure. Okay. In case they're on their spouses. Right. Okay.

Anything else on this page before I move on?

And then the other piece is the employee contributions themselves. I can say this for certain. I haven't seen... ESPECIALLY A PUBLIC SECTOR GROUP, KEEP THEIR CONTRIBUTION LEVELS THE SAME EVERY SINGLE YEAR LIKE THE CITY HAS. AND I KNOW IT'S BEEN A HUGE CATALYST. AND I KNOW SPEAKING WITH DARREN EVERY YEAR, HE'S ALWAYS BEEN VERY PROUD OF THAT FACT. UNFORTUNATELY, WITH THE INCREASE IN COSTS, WE DID WANT TO LOOK AT WHAT POTENTIALLY BUMPING UP SOME OF THOSE CONTRIBUTIONS WOULD LOOK LIKE FOR EMPLOYEES. AND SO YOU CAN SEE ON THE MEDICAL AND DENTAL SIDE, A RECOMMENDED EMPLOYEE CONTRIBUTION INCREASE, AT THE VERY RIGHT-HAND SIDE, YOU'LL SEE WHAT THAT IS ON A MONTHLY BASIS, AND THEN PER PAYCHECK ON A SEMIMONTHLY BASIS. SO FOR AN EMPLOYEE ONLY, FOR EXAMPLE, IT WOULD GO UP ABOUT $25 A MONTH. EMPLOYEE SPOUSE, $35. EMPLOYEE CHILD, $25. AND THEN FAMILY, $35.

YOU KNOW, YEARS AGO, WHEN AN EMPLOYEE RETIRED, THEY PAID A HIGHER PREMIUM. WHAT WAS THAT, A COBRA? And now retired employees pay the same premium as if they were still working here. Would that make any difference in that premium?

It could, but you're also talking about such a few amount of individuals that big picture, it's probably not going to make a big change. And so, you know, looking at just where enrollment falls in now, I don't know off the top of my head how many retirees you have on the health plan, but

It's four or five.

Really? Yeah.

How long can they do it?

They have to get off once they're 63. 65. Available for state and federal assistance.

If this is the recommended contribution, can they contribute more if they wanted to? Could the employees? Or could any employee? Not per employee. Okay, so it's just that's the recommended amount.

This is the rates, yeah, and it's a good question, but yeah, this is... A whole bunch of apples get treated the same.

Is it possible, making this switch, trying to make sense of where we're at in our deficit, is it possible to show like companies, not just the trend itself, for our employees to be able to cross-reference. That way they can see the information and then they'll have a better idea of what's going on.

Yeah. From what employees are paying from a contribution standpoint outside, you know. Outside. Yeah. I think that would make sense.

And we've done that from time to time in the past. We can certainly pull together a benchmark that Kim can use in kind of her open enrollment messaging. And we're still much lower than, you know, peers here. Absolutely, yeah.

I think we can provide some of the information, maybe four of them, then they can see where we're looking at.

Yeah. Absolutely. Just to tell you, I mean, obviously we can talk to employees about that, but from Kansas commercial-wide, employee-only, the average is $160 a month. So it's still significantly more than, you know, the recommended $92 that it'd be bumped up to.

It's enough of a change that it's going to affect the way they look at their raises to a point, too. So nobody's trying to build their own budget and make this make sense.

I understood. 100%. And then, really, this slide just looks at, with all of these recommended changes, what we've seen in the health plan, where we can anticipate costs to be for 2027, really to kind of right-size this ship. We would still be looking at about a $262,000 increase on the city side, which is about 14.4% over the current budget. But with these recommended changes and then the increase listed here, we believe this is that number that will get kind of the health plan right size. And then on a monthly basis moving forward, we're not running at such a large deficit. AND THEN JUST THE LAST TWO SLIDES, I PUT TOGETHER THAT ILLUSTRATIVE TRACKER WITH REALLY THE NEW BUDGETED COSTS WITH THE RECOMMENDED CHANGES AND REALLY THIS IS JUST A WAY TO SHOW YOU THAT THIS IS HOW THAT YEAR END WOULD BALANCE OUT FOR 2027. SO WE'D ANTICIPATE COSTS TO BE ABOUT 227 A MONTH WITH THAT RECOMMENDED BUDGET OF 227 A MONTH AS WELL. Based on what we've seen on the health plan today and then the recommended changes with the plan design network and contribution shift.

But that doesn't eat the 800,000 that we're projecting for the current year. So we'd have to make that whole. And then this plan should keep us balanced. But that's our hope. And then to Cheryl's point 30 minutes ago, and then you need to make, you know, somehow you need to consider putting a balance in there and making sure you guys are aware that if we run into a deficit again, then we're into the general fund. We're not, we're out. It's there.

You hope not to use it, but it's there.

Yeah.

Good point.

And this is a, this is, this is pretty useful. I think. Go ahead, Nick.

Yeah. And so really I took that first slide and then put the 2026, what we would estimate it to finish at, and then 2027, the illustrative with those recommended changes, what we'd anticipate to happen. And so you'll see in 26, if you annualize that, we'd estimate the plan to run at 3.5 million. with these recommended changes, the hope and to right-size this thing is to get it back down to about 2.7 million. And then you can see, I kept updating that trend line as well. And so trend every year is five to 9%. That's what we're seeing in the market. And so you can see once that dollar amount gets bigger and bigger, that just continues to grow and grow. And so in 2026, that trend line would be up to 5 million. And then in 27, it'd be 5.5 million. So the hope is to continue to kind of combat that trend line from going up every year like we do see in the market.

With the help of IMA, we're going to put together a video for the employees, kind of explain in this five minutes and make sure they all, you know, sign off like any other training thing. Make sure they sign off that they watched it.

We don't.

This won't take effect until January, so we'll get through the budget, see how they come out on raises and things like that before we approach them. But we want to make sure that they're aware of what's coming, and DJ brought up a good point. You don't want to do it too much because you don't want to say, hey. You're grounded for two months, but your cousin's grounded for a year. That doesn't feel very, oh, that makes me feel better. But in this case, there's a lot of public agencies that are charging way more for health insurance than the city is, and we should be proud of the program we have, but we have a responsibility to taxpayers and employees to make sure that it's in balance. And that's kind of where we are today. Hopefully the claims will go back down, but you guys didn't make me feel too good that that was probably going to happen, that maybe this is just a trend and this is the expense of health care, so. We're kind of chasing our tail right at the last part of this.

I appreciate you putting all this together and being able to come up and answer questions towards us, too, because it does create a lot of new questions, and I'm sure we'll have more moving forward. The last thing I have for this is, off this trend, is there some, and I'm not aware, so I'm asking a question in the direction I don't have any background, but is there an additional plan or something that would be available for parents that have children with known issues that are going to generate more medical needs? Is there something that could run concurrent with the city's current program that would be available to those families specifically? Not so much a base coverage for everyone, but if they knew there's pre-existing conditions and common things that they're dealing with, is there something out there that they would be available for that we could look at as an organization?

That's where it gets a little tricky from a compliance standpoint. and HIPAA purposes and you can't really incentivize or steer members to, you know, we could look at, you know, just offering an additional plan instead of just the, you know, $1,500 deductible and maybe look at it like a different plan. But you can't really incentivize or steer members to something like that. I don't know, Chris, if you have any other.

say you have an impaired child, there are a number of state programs.

Right, there's state programs like the CHIP and there's other state programs that they could, but from the city's perspective in sponsoring a health plan, typically we would see those steering those members to maybe one of the state or state or federal program.

We're currently not aware of something out there that's similar to that would exist.

I mean, the city offers accident critical illness, hospital indemnity policies. So if someone knows they have a big event coming up, there's coverages at open enrollment that they could buy to basically indemnify themselves for extra coverage. So that's being done today. You know, there really isn't any incentive for the employee to go out and buy a separate plan because it's going to cost them substantially more than what the city is covering them. And that's the benefit of that employer offering that's keeping them coming back to work every day. So there's a little bit of a misaligned incentive to try to push them to something else. But I think the hospital indemnity accident critical illness is really what that's there for. And that's really meeting the needs of people as long as they kind of think about those things at open enrollment, which of course we promote and hit. But people tend to want to buy insurance when their house is on fire, not before it's on fire. But certainly it's a good thought and I like the strategic thinking that you're thinking about.

Yeah, we we asked all those questions because we have I really want to thank Christy and Nick because I'm pretty sure they've felt outnumbered between Darren J. Katie, Lauren and I and Missy for the last several months that we've been over this trying to figure out how we could balance it. This is the best recruiting and retention tool that we have for our employees is our health plan, and we've really tried to keep it competitive for them. But, you know, we've asked all the questions, and, you know, you can't single out people.

And not so much in the idea of singling them out, just if there's something available that exists that can be paired with the city's insurance coverage, then, you know. If that's something that's trending out there, I don't know hopefully medical Catastrophic is not a trending thing. We have to deal with in the future, but obviously we're dealing with it now.

So Well, make sure thanks to IMA they've been with us a long time They're obviously on the stick and they know their their business and they've kept us in the black for a long time and they didn't bail on us when we went into the red they're heading to the red so We'll bring the employees up to speed on this. We'll do a lot.

Any other questions, please still filter them through. We're always happy to answer them and welcome to come back at any time. Thanks for having us today. I know we took a lot of time.

I appreciate it. Thanks, you guys.

Pathways to Hope. Representation from Pathways to Hope will provide an update on the program.

Commissioner Sarah, Brian, Kaylin, we're here last meeting, and we left them off the agenda. It's not on purpose. So they're back, and they're just going to give their annual update on the important program that helps a lot of people in our town. So thanks for coming, y'all.

Yeah, absolutely. I'm Sarah Elnicki. I'm deputy general counsel and director of legal services at CHC. I have Tessa Moody, who also is a CHC community health worker, Brian Dyson, CHC specialty courts coordinator. I think you all know Ms. Hite, the city prosecutor. So I will, I've not had an opportunity to come before you all and kind of talk about Pathways to Hope and just wanted to kind of give you an update and just some information about the program. Program started September of 2023. And since then, we've been able to work with a number of individuals who have come through municipal court and who have pending nonviolent charges. And so we're talking trespassing, those types of crimes. And what the program aims to do is to identify individuals who just need help with an underlying need, housing, transportation, You know, I think what we were seeing in the courts, what, you know, Mr. Mazurk was seeing before he left, and now what Ms. Hite is seeing are people that are, you know, coming before the court and having the same issues and the needs and trying to understand what was really bringing them there wasn't being addressed. And so what TESSA does is when a participant is referred to the program from Ms. Hite, Tessa works with that participant one-on-one. She tries to meet with the participant within 72 hours of them coming to court. And then it's a four-phase program if the participant signs on. And so it's housing, it's ID recovery, it's benefits, it's transportation. Tessa and the participant work together to try to make goals. to really remedy the issue that brought them to court in the first place. Tessa, well, since May of 2025, there have been 31 individuals that have been referred to the program. 24 of those had housing issues. Tessa's working with nine of them currently, and she's housed 15 and only one. So 14 of the 15, she's housed successfully. And only one has returned to homelessness. And so super proud of the work that Tess is doing. She works in collaboration with a lot of agencies, local agencies, Crawford County Mental Health, DECA, all of the housing authorities. And so I'm trying to think if there's anything else that I've missed. Rattle off a lot. So that's really just the overview of the program. Typically, participants work with Tessa for about 90 to 120 days. Tessa comes to court every Wednesday. She provides updates to Ms. Height. If a participant is showing up and working their case plan, then they continue to work with Tessa until all of their goals and their phases are met. And then at the end, if they complete those four phases, then Ms. Height can decide to dismiss the charges, the underlying charges. So it's a good incentive for participants to not just pay a fine and then show up next week on a similar charge. It's really trying to address what brought them there in the first place. So anybody else? Do you all have any questions for us about the program?

Just the underlying question, what's the rubric you use to qualify and recommend somebody for this program?

Good question. So we've actually expanded it within the last year. Originally, it was anyone that had housing insecurity and that nonviolent charge. Those were kind of the two criteria. We expanded it, so it's housing instability. We also work with someone with a lack of community or family support, so somebody who is just really kind of out there alone and doesn't really have someone to help them navigate how they're going to get their needs addressed. And then also those victims of domestic violence, TESSA will also work with them as well. And so those are the criteria. The 15 that Tessa's housed, these aren't just single people. These are people that have families. And so if you think about the impact of housing 15 people who have families, it's a big impact, really. And so it started out at housing, but it has really broadened the scope on the things that Tessa can work on.

And then the other question is just the reoccurring use of the program and being brought back into the program. Is that common or is it a one and done generally?

All that TUSA, do you see repeat people? There's been very few people that have repeated. I've probably seen, in the year that I've been doing the program, probably only have seen like two or three.

So in the housing, do you work with the city housing department?

Oh, yes, I see them a lot. I just see her earlier today, actually.

So that's the major issue. It sounds like people without a house falls in trouble. But you've found them places. Is that hard to find places for people that's committed a crime?

Yes. I have a few, probably three off the top of my head, good landlords that are willing to give people a chance. When they don't have openings, it's kind of more difficult because the major landlords like Pro-X in Mid-America aren't willing to accommodate as easy as local landlords.

Right. Who did you say?

Pro-X in Mid-America?

Brooks?

Pro-X.

Oh, Pro-X. I thought you said Brooks, and I was like, oh, I've never heard that. Pro-X. Yeah.

And, you know, Tesla has, I think, worked with, you know, there's been a few that have been really difficult to house, and so I think it's just persistence, and Tessa will, you know, sit down with the participant, and, you know, they'll get on the phones together, they'll, you know, really try to identify, you know, if there's a stone to be, you know, turned over, Tessa's going to try to find that, you know, for someone, so not easy, but she's persistent.

The last thing I have, I'm sorry, you came and brought up another one. So the individual that gets brought in and referred to this, what steps are they required to take to qualify through this and graduate from the program?

So first, you know, Ms. Height will identify them, talk to them about the program if they, you know, want to work with TESSA. It's a lot more work than just paying a fine and going about your day. And so then they do intake paperwork with Tessa, and then it's constant communication with her. So it's weekly, if not daily, communication at first, really trying to identify what are the immediate needs. Those are those needs that are going to be dealt with in that first phase. Do they have a place to stay overnight? We will do emergency hotel stays while they're trying to find someplace. So it's identifying those immediate needs in the first phases, and then it progresses to do you have transportation to get you to a medical appointment? I mean, she may get a referral for housing, but then once she meets with people, it becomes a much bigger scope. hey, you need a mental health referral or substance use treatment referral. Those are all things that will be identified in those first meetings. So every person's plan is different. It's not just each person has to do certain things. It's really Ms. High communicating to TESSA those things that need to be done in order for this person's charges to be dismissed.

So that 90 to 120 days, you're seeing these people probably more than 10 times, roughly? Is that average?

Yes.

Yes. So you said you, I forgot the numbers, that you helped, but there was one you couldn't help. What happened to that person?

It's not one that I couldn't help. It's one that came back into homelessness because of failure to maintain the housing. Basically, this person relapsed, and they ended up be coming back into homeless and back through the system.

And then they go to...

If they get more charges, they would come back to her, but this person specifically hasn't gotten more charges.

Thank you. I appreciate you asking that question. Sounds like the program's working.

Thanks.

Thanks.

Sorry for the mishap last minute.

Oh, that's okay. Thank you guys very much.

Thank you. Thank you. All right. City Manager submitted budget. City Manager Darren Hall will present the City Manager submitted budget for 2027.

Mayor, Commissioners, you should have a notebook in front of you with a picture of the College of Business, the Research Road, and I think that's JC's ball field, what it's going to look like next year. So yeah, usually I read my letter, but this year it's two and a half pages, and I'm just not going to read it. So it's in there. This budget will be posted tomorrow morning on the website. But I will give you just kind of a brief recap. We've spent a lot of time this year. You guys are familiar with the budget calendar and everything that we've added to it. And as is the case for the past several years, we're obviously facing increasing costs to operate the city. We're blessed this year with a finance director, not just a finance director, but a new finance director, and she's very skilled, so she's brought a lot to the table with putting this budget together. She was also provided a new financial management system when she got here that was just getting started, so between her and Jay. And most of the department heads and a lot of the users have spent I don't know how many hours on that new system. It isn't live yet, but we were able to take the budget and put it into the budget module. And so the budget that you see in the notebook, there's two budgets in there. The first one is the state budget, which is, you know, we talked about it last year. That's the actual certified budget that you pass. It sets the mill rate. But in addition to that, there's a line item budget of the entire city's budget by department, by fund. with actuals and estimated expenditures for 26 in the budget. So you can go through there. And that should hopefully lead the next five weeks of budget discussions because you'll have full detail on everything that's been in there. We have a new budget process. Like I said, we've met, you know, all the department heads were in here for three months giving presentations. We've kind of just started from scratch. Throughout the old system, Missy had to take the old system, which was an Excel spreadsheet that caused a lot of grief last year, And basically met with the department heads and just said, okay, what are our revenue goals? We obviously wanted to reduce the mill rate. We didn't know what assessed valuations were going to be yet, so we met with a couple things we never did before. We met with the county twice. We met with the school district once. The county clerk has presented to us on what the assessed valuation is going to be, so there should be no questions about what that is. So using those numbers, we kind of just built the budget from scratch. brought it back up. We did address several major things. We did reduce the mill, 2.152 mills. We will not exceed the revenue neutral rate if you stick with the budget that we submit today, which has never happened before. We did manage to get 3% employee raises in here, which was... which was not easy. Um, and we addressed the imbalance, the employee health fund, which was referred to, we talked about for the last 45 minutes with a 15% increase on the taxpayer side of that to, to help close that gap. And then of course the employees you saw what, um, they're going to face with their, their pace, the paycheck. But the idea with the pay is, um, when I got here, we were increasing, The health insurance was going up 18% a year, and we weren't giving raises. So that was not a kind of environment that's going to attract a lot of employees. We've turned that around. We want to keep that momentum going forward. This budget has a huge major emphasis always on public safety and infrastructure. We balanced the general fund by reducing the operational cost by a third. which is a big number and support services by half. So I think that number was just under a million dollars. But when you put the raises in, that's about $400,000 in the general fund. And then when you put in the reduction of mills, a mill this year, it looks like it's about $182,000. over two mills is $360,000, a little more. You're looking at about $800,000. So we took you to your directions you gave us and said, okay, we've got to get serious about not just reducing the revenues, but we've got to reduce something on the expensive side too. So we've put that in there. We'll see how it plays out. Once again, this budget is being put together in July and August, and it'll be effective through next December. So a lot of time between now and then and One of the things that we did on the balancing was a lot of times we transfer ahead of time from the general fund into the other funds, anticipating losses. It's hard to keep the pool in the black. It's hard to keep parks in the black, the golf course in the black. But we pulled those transfers out and then just held those back. And we'll make those transfers at the end of next year if we need them, rather than just taking them out of the general fund now. So Missy's brought a lot to the table on just making sure that the jump from the spreadsheet to get loaded into the new system, and then from the new system, get balanced. And then when it was balanced, we had to use it to tie out the state workbooks. There's a lot in there. But it's amazing what you can do when you have talent in your office. And her and Jay have really led the help. And Kim sat through more meetings. She was wondering why as HR director she was sitting in all the budget meetings, but I had to have somebody else in there. So everybody on the executive team has stepped up, and everybody on their staff has really done what we've asked them. Specifically, we did reduce or cut a few services. The tree removal for the $100,000 per year that we've done the last couple years has been removed. The demolition of dilapidated structures is traditionally funded $100,000 a year. We took that down to $50,000. I don't think we can do away with that program, but it's a very popular program. It keeps our town looking good, but the money has got to come from somewhere. So this is our submitted budget to you. We have a meeting on August 11th. We have a meeting on August 28th. And we also have the budget meeting where it needs to be passed on September 8th. So we will not have to have a revenue neutral rate hearing, which is kind of nice. That tells you how that means the revenue neutral rate was set. That's the level. with the current evaluation and everything in the budget you're putting together that would give you the same tax dollars you had the year before. So the fact that we're under that means that we are not using more. I think we're actually down about a quarter of a million dollars just on the tax sheet when you show that about what our mill increased. But if you think about a mill, we're down 2.152 mills. this year what it would have generated, it's over $370,000. So I really appreciate the work. It was just a new approach to the budgeting for us. You know, we kind of do what's necessary, and obviously it was necessary just to dig into this. And it's very important to note that we have a new financial management system. We have a new finance director. We're in a much better place. The reports are much better. The information you're seeing is coming out of a system now rather than coming out of a spreadsheet. So we have a lot of confidence that the numbers are good. But there's still a million decisions to make. And it's your budget at this point. We're here to help you. So tell us what you want from us. Please read it. And like I said, we'll have it on the web tomorrow so everybody else can read it. It's pretty straightforward. The reports will get better and better each year. But like I said, the system is not even live for another two months.

Actually, Nick.

It was the next month, so we're coming in on it. But we were able to get the budget into it, and with that, traditionally we just give it to you and get on to it next time. But if you have any general questions, I know we've got a pretty big agenda, but we are happy to present it to you. We're happy it's down. We're happy that property tax is down, and we're happy that we could get 3% raises in there because obviously the cost of being an employee is going up as well.

So to be clear, the two primary things that were cut were the tree service and the dilapidated housing was reduced.

Those were the two main areas that were... No, we cut a million dollars out of the employee support services out of the general fund, which is travel, equipment, things that they buy for their office, training, contract services, professional services to support them doing their jobs.

Yeah. Yeah. 2.15 is very close. Obviously, I was hoping we would get closer to a full 3%. I guess we'll have to look closer and deeper to try to at least get that to a starting point. This is recovering some of the complication from last year's. budget that was overlaid and some of the issues with the increase. So to Roger's question earlier, reduction in spending, not just usage of the reserves and cutting services and the availability. So we've got more work to do for sure.

I just say the 2.152 mil reduction is a start. I know each department came with their wants for several different commission meetings, and we're going to have to take a look at what the wants are compared to what the needs are, and hopefully we can reduce expenses with that also because I think we need to do do that, look at it closer, see how much more we can reduce. But it's a start, you know, we can go from there.

I like how we brought the The budget meetings out in front for the public to actually be a part of and be able to see and go back and view. I think that's a big step towards trying to get this balanced and actually make it make sense to where the money's going, where it's coming from. All the revenue sources that are flowing into the city and then providing an explanation of where they're flowing out of. I would recommend or ask for next year's budget. I know you're following the statutory requirement to submit the budget to the Commission, but something of this magnitude with the new system, I'd like to see the Commission get this maybe at least a week prior to this meeting so we have some time to go through it and then we can have some questions and some more back and forth for this actual, this date. Is that something we can do?

I guess the question is how many weeks do you want to have the budget between when I give it to you and when you have to pass it? Right now you have five weeks. If you want it six weeks or seven weeks, I mean, just tell me the number and we'll... Well, it's primarily with this date.

It was the first time we're seeing this. I know I've asked you some questions throughout the last several weeks about specifics in the budget, and I haven't seen it yet. So what I'm asking for is if this product's created through the module and it's available, can we get it a week before this meeting so today, next year, we can have a better discussion over it? We've got a pretty heavy agenda, I agree, and there's a lot involved, but this is probably the largest item in the agenda today that people want to know about. So just having your commission more aware.

You have to get the budget at some meeting. And this is the meeting you chose. If you wanted it a month earlier, you just have to tell me. You have three full meetings coming up to talk about the budget. So if you don't, I mean, we can give it to you. What meeting do you want it? I mean. I have to give it to you at a meeting. You didn't get it earlier today because today we were still making changes to it and printing the books. I mean, it's just like a term paper. You work on it until you have to give it out. So if you guys let me know when you want it. I mean, I can't give it to you before we get the assessed valuations, but we get it to you when we're out of time and we have to give it to you. If I could have given it to you two weeks earlier, I would have given it to you at the last meeting.

What's the latest you can give it today?

The latest you can give it is, I can give it to you whenever it's ready. I mean, the date that matters is the day that you have to pass it by September 8th. By September 8th? Yeah.

Okay. All right. So we can get it any time between now and September 8th, as long as we have enough time to go over it.

We could get it to you in March. But it gets better every, you know. Half of the budget is an estimate of what the current year is going to be, and we're taking off from that year to do next year's budget. If we do it before June, we don't even have half of this year to estimate off of. So the budget calendar is driven by how long it takes to do the budget, how long you want to go through it. You have three full meetings, and any special meeting you want to call to sit in here and talk about the budget. So it's not late. We gave it to you when it's been planned since January to give it to you. If you want it earlier... Next year will be a lot easier to do, but it's just like a term paper. We just get to it.

I know you wanted it a week ago, but it wasn't ready a week ago. That's primarily why I'm asking this. It's a new version of the budget, a new view of it for the whole commission. So if it's possible to get this, and I'll restate it, a week before this meeting, just what you have here. If there was eaches, then annotate and let us know those eaches that are not completed yet just to give us time for when you do. We're discussing it. Yeah.

The budget's If you're asking for a fourth meeting to have the budget so you can discuss it, we just need to move up a calendar.

No, I'm just asking for the budget to be submitted to the commission for review prior to this meeting.

That's not going to happen because we're going to present it at a commission meeting. And when that commission meeting is, we are going to work on it until then. There's still work we could have done in this budget, but it was due today, so we made sure it was balanced and we kicked it out. But if we had another two weeks before the next meeting, I'm sure Missy would have come up with a hundred other things that she wanted to do.

So take... We could have a special meeting to go over everything here, too.

Yeah, you can do, I mean, you have five weeks to go over this budget. And if you want seven, we can give it to you. the first meeting in July, I guess. But what I'm saying is I'm not going to kick it to you on a Sunday a week before the meeting when I'm going to give it to you because we're going to keep working on it until we're out of time. I didn't sit on this for a week.

This is due today. I'm just saying if it's possible to get a copy of it before you present it to the commission like we do almost everything else. then it would be beneficial for us to have time to review it and then have this back and forth discussion.

What's the point of submitting a permission meeting then?

Every other agenda item has a, this is a five week calendar on it and three formal meetings for you to meet on it. You're not getting it late. You're getting it when you have three meetings to work on. If you want to get it where you have four meetings, just let us know and we'll do that. But it's, It's not like we were sitting on it last week going, hey, this is cool. We could have given it to the commission. We literally have spent nothing but 10-hour days balancing this budget, trying to cut out the money and get the services where you wanted. So, yeah, if you want it earlier, just tell me, and we'll try to bring it out the next meeting.

Well, we got the packet agenda Wednesday. Was this finished then? Nope. We're going to have had it?

We have had July 28th on our calendar since January.

So this just got finished?

I've made changes to my letter today. I don't think Tammy is very happy with me because she's printed several versions of this just today. And that's one reason you've got it in a notebook now because we were making so many changes at the end that it was like, Binding that thing and it's impossible to change. So this is a much friendlier working document I think you guys have three full meetings and any other special meeting paper wasn't warm either It's a lot of the press and it says submitted right across it.

So yeah, I appreciate Next meeting you're gonna take this away and give us another it's your budget So, do you guys want to have a special meeting to go over this I

We may need to. I need some time to go over it since this is the first time I've seen it. That may be beneficial.

You're not being asked to adopt it. You're aware of that, right? I do. You have five weeks and then some change.

Just like last year, we don't want to wait until the five-month mark that he said about why are you asking questions all of a sudden. So if we went ahead and had a special meeting and asked the questions all the way through without the employees feeling like we're, this is all new to us too. So like just want to know and ask questions and be able to have a good dialogue.

How many meetings between now and the time you have to submit the budget? There's three planned, but you can have 18.

How many total meetings are we going to have? You have August 11th. Three or four? Yeah, the 28th or the 25th. I think that's 14 days. And then you have September 8th. We have another formal hearing.

Four more, so four more times the budget could come up. Here, in the meeting here. Three more. So do we need a special meeting?

Well, that's up to y'all. We haven't even had one meeting since we just got this. Sure. How do we know that we need a special meeting if we haven't?

Well, that way you are able to go through everything and they talk about everything that's in here. Yeah, we can see where it is.

My sole concern is that we don't have another 2026 budget and so many changes, and that's why I'm asking this. So if we had a copy of it, and again, if... the changes were, you know, in the data, then I would feel differently about it right now. But if it's solely in a statement or your letter to the commission, to the city, then we could have had some of this information, yes, last week to review it. And then today we would actually know if we needed a special meeting or not, or at least get closer to that. So I'll review it and we'll look through it.

Let me give you a better timeline. Today's Tuesday. On Wednesday of last week, We got it, and when did we put it into the new system, and it was unbalanced, and not balanced? So a week ago, we finally got it into the new system, which is pretty Herculean task, since it was a brand new system, and she had to do an entire new chart of accounts. At that point, we can run a total and see where we are, and of course, it was way out of balance. So by... I think Saturday or Friday we were sitting in Missy's office at 1 in the afternoon and we all looked at each other and said, okay, it's balanced. Then Missy tried to start putting it into the state workbook, which is a way to check it because those two have to match and the state workbook is actually what's submitted to the state and it wasn't in balance. So we had to go back and spend the weekend trying to get it in balance. When was it finally in balance do you think?

I think it was Sunday.

So Sunday. So had we given it to you any time last week, we would have repeated last year where we were like, hey, that's not the right one. So this is the right one. This is as soon as we could get it to you. Next year I'd be happy to try to get any calendar you want and get it to you whenever you want.

So you said Sunday it was?

Sunday I think it was probably.

So you could have gave it to us in the packet?

No, because Sunday afternoon we balanced it, and then we had to make it.

This isn't...

We asked you for software when we had our budget hearings to put a book together, and we were told, you know, we're going to cut back. We're not going to do it. So this is handmade. This is a combination of the state report. a combination of Missy's system. They have to be balanced together. Hopefully they are. That's what we spent the last, yesterday we ran around and tried to get the book presented. Today's Tuesday, and today we made a lot of changes cosmetically, so it actually looks the way it does, but.

Missy, so to that effect, are we going to see additional changes to this moving over the next couple weeks?

Not unless you ask us to make those changes. This is the submitted budget. We're done. It's your budget now.

Yeah. I think probably to put things in perspective here with the new system, we thought because we can get reports directly out of the system, instead of me having to run an Excel spreadsheet and hope that the formulas didn't get mixed up or anything like that, we thought we made a choice that we would put this information into the system and let the system run the reports. Okay, that still doesn't map into the state documents. So first of all, the accounting system the numbering system is different from the old system to the new system because we made some improvements to that and the mappings are not the same that the numbers are not identical so not only do we have to bring it into the new system we have to put new numbers we have to identify the numbers that it maps into so i built it i built a mapping document a crosswalk and I had to bring that in, I had to crosswalk the numbers, I had to sort the numbers out, then I had to dump it into an import worksheet, and then I had to dump it into the system. I had to do that, and then we couldn't do that until we got the system, they had to bring in the system actuals or you wouldn't have actuals. They had to bring in our actuals for 20. I said, okay, if you can get me budgeted 26, if you can get me budgeted 25 and actuals 25 in the system, in the new system, then I think I can import the others. So then I had to import in the projected 26 and I had to import in the budgeted 27 numbers that we had come up with. I had to take those from an Excel spreadsheet that we had created to start with. And I had to map those over into the new accounts. And then we had to upload those in the system. Then we had to make sure that they uploaded correctly. So it's not as easy as you key this. So you can see that from the back part of this, from pages 30, all the way to the back, with exception of the payroll information. So from 30 to 119. So what is that? 80 some pages? 80 some pages that those are account numbers that we had to check. And I had my staff checking those while we were working on the budget. So it wasn't as easy as you think. And most people, if I hadn't had a lot of experience doing this before in my previous positions, A normal person wouldn't be able to do this. Okay.

And the only reason, the only thing that will change now is whatever changes you want. If you come back and say, hey, give us a scenario where the raises are two and a half or four and a half, then Missy can run it. We can do that one week. If you want to come in here just one week and have all the department heads here and go through line item, we can do that. We will not change. This is the submitted budget. We will change it according to what you want to see in the final budget over the next five weeks as you direct us. I can't be any clearer than that. And that should be a lot easier this year with it in the new system than it was last year off of the spreadsheet that we thought was right. I'll miss you.

I think the other thing you need to know is that there's not a There's not a perfect way to get this data into the state worksheets, okay? So what I have to do is, luckily the new system does give us some good checks and some good ability to pull the data and dump it into Excel and check our numbers and see if that works. But when they say general fund in the system, the general fund is fund 100. When you go to the state worksheet, general fund is fund 100, fund 215. It's a whole slew of funds, 180, which is the health care. The state considers those all general funds. when we only consider 100 general. And so there's a different way that they line it out and consider it versus how we have it in our system. So it's not as easy. You're not going to be able to go, okay, well I've got general fund here and it's going to tie here. You're going to need, if you need me to work through this with you, I can pull, we can pull up the system and you can see how I run the reports and I dump them in so I can check them manually. So we went through this a lot. I went through it a lot, and Jay went and checked my numbers a lot. We spent a lot of hours on this because I want to make it right. I want to make sure that the numbers are in here, the numbers that are here map over to here.

Nobody's saying that any of this is easy, and I agree. You guys are working very hard to make this make sense and make it right. The software that was in the package that was approved last year did have this module to run budget and reports, and again, you explained that it doesn't tie directly to the state documents, and that's why essentially the Commission didn't approve additional software because we had existing software that was already in the new system. I know it's been difficult to get it running. My concern is just the time of having a new view of this budget and how things are being generated. Nobody's discrediting anybody's efforts and time in this. The Commission wants to have a better view and understanding of that process, so I appreciate you offering that up, and I'll definitely be in your office to come through this.

Well, wait a minute. I think it should be all of us, not just one-on-one. And if this is the playbook, so to speak, I want to hear it from you. I want you to help us understand everything, not in due time here, but I want to understand it better because I want to make sure that we're doing what we can to cut expenses for the best option for the city, but not cut employee benefits and pay or fire and police or anything like that. But I want to understand it. If you would be gracious enough to do that, I want to have a special meeting. I want us all to hear the same information. I don't want to go one-on-one. I don't think it's fair to us and it's not fair to her because it takes up her time when she can say it once.

I like what Darren said a while ago. We want each department to come in here and show us, you know, whatever that was, 2.152. Mm-hmm. show us in their budget what their actual needs are and what their wants are. I'm sure we can find some more ways to cut expenses. And it's going to take another meeting with that included, I think. You know, just go through department-wise and say, hey, what do you see that we could cut?

And I want it to be where nobody's on report. I just want to talk.

Why don't you just have...

I want people to understand that we're just like you guys. You just want to help us understand.

There's a... We want you to understand. There's a meeting on August 11th, and there's a meeting on August two weeks later. Is that... Why don't you just... make the August 11th meeting your first meeting on the budget. You're still a month ahead of when... I mean, you can have a special meeting, but you also have two entire meetings.

But if that's all we're talking about, the special meeting will be just...

If you put the 2027 budget on the next meeting agenda... Our meetings are already four hours long. I mean, you can just do it that night. I mean, we'll just do the regular business, but that's the whole point of it.

As long as we can get all of our questions answered and go through it, not hurriedly, but, yeah, I'd love that. Yeah, two and a half weeks.

Do it at 4.30 and do it outside of the agenda.

I would ask, go through the budget and make some notes, and if you could email me ahead of time, I will be better prepared to answer those questions.

Well, see, that's one thing, too. I just want to be able to pick your brain. I don't want you to be like you're being graded. I just want to know.

You don't want to pick my brain.

No, I mean, I just don't want you to feel like, oh, she didn't get that one right, or I don't want that. I just want, help me understand what it is that you're talking about.

Okay, that'd be great.

And that's what this is all, to me, that's what this is all about. Just like when they were explaining about their program and help us understand everything that's going on because ultimately we sit up here and make the decision and we want to make sure it's the right one. Just like you do.

I'm coming up on a year here in September so not quite been a year. It takes a while to get your feet wet and to kind of understand things because things are, you know, I did fund accounting for like only a year before I come here but I've had lots of other experience counting and and software implementations and stuff like that, and auditing and that sort of thing. But this is a new way to think about things. You have to almost re-engineer your brain to think fund accounting versus regular accounting. So I understand that. So I'm just now getting my word.

I still want you to say hi to me at Walmart, OK? But anyway, thank you.

With all the questions about the budget, I know you guys need to answer to us. Well, we have to answer to the taxpayers, you know, and we need to get the answers they want asked. So, you know, if it takes four hours for a full meeting, it takes four hours.

Or two four-hour meetings. I mean, my point is you have two full meetings to spend as much time, and if we need another one, we can do another one.

I think it's very obvious we all care, for sure. I mean, we all care about it, so. Otherwise, we just say, oh, done, okay. But I appreciate you, Missy. Thank you.

Have that on the agenda? No, just put it on the agenda. All right. Sounds good.

It really doesn't need to be any earlier, does it, just as long as we're discussing it? Or does it?

I think the intent is to have ample amount of time to... process it get the direction from Missy and the staff on on how they came to where they're at now and obviously if they're still if it was still a product being worked on until today then you know there there are things that are going to come up moving forward now that we have a product in front of us just more open communication between what you're doing how it's done and how the Commission can help and be a part of it moving forward consider calling Hyde Law LLC project

Consider the recommendation of the Economic Development Advisory Committee to allocate up to $40,000 from the revolving loan fund to support the request from Height Law LLC to renovate the property at 919 North Broadway.

All right. Good evening, Mr. Mayor, members of the Commission. I'm here to bring in a recommendation from the EDAC that is consistent with past recommendations they've issued related to building improvement projects. This property specifically relates to 919 North Broadway. I think most of our residents would associate that with the corner patio property. This does include the corner patio. But as you're about to hear, the focus of the redevelopment efforts is really just to the east of that, which were some former motel properties, I believe. West, right? West, yeah, sorry, yeah. Yes, thank you for that correction. West, that will become the new home of Height Law. So to tell you a little bit about this, I'm going to turn it over to Kaylynn. And Kaylynn, you can scroll through your presentation with the down arrow key there.

Okay, give it a try. Hello again, I'm back. Good evening to the commissioners and Mayor Munson. So as I already kind of mentioned earlier, my name's Kaylin Height, and my husband and I purchased 919 North Broadway back in November. And as Blake said, it consists of the corner patio and then goes back east. So it was previously a five-unit motel that was built in 1930. And so it was partially remodeled. The previous owners, it currently holds two single-unit Airbnbs that are active and running, and then the corner patio, which was completely redone and is also up and running. So I came to the ADAC to request assistance in remodeling the back part of the building to become my law office, High Law LLC. And so for those of you who don't know me, Kay Lynn Hite, I grew up here. I grew up in Cherokee, Kansas. I'm a very proud Southeast Lancer. I went to Pitt State. Then I went to Washburn to get my law degree, and I always knew I wanted to come home. I have been fortunate. I've worked with three of the law firms here in town during that time, either during or, well, actually before law school, I worked with Wheeler & Mitchelson. Through law school, I worked for Spigarelli's. And post-law school, I worked with Fleming Law Firm. And then October of last year, I was fortunate to become your new city prosecutor. So I do that on the side in addition to my private practice. And then in April of this year, I decided to try to hang my own shingle. It's currently just my kitchen table, but it's working so far. I'm also very involved in the community. I'm a chamber ambassador. I'm an executive member for the chamber. I'm secretary of Sunrise Rotary. I'm a PEO member. And I was a 2023 Woman of Distinction. And this May, I was surprised with Volunteer of the Year. So it's been a very busy year. I am married to my husband, Sean Seamatter, who he coached at St. Mary's Colgan. He was the head football coach for nine years. After 13 years in education, he decided he should make a career change, and so he switched it up, and now he is a recruiter for the Crossland Kickstart Program, recruiting high school juniors and seniors to PARTICIPATE IN THE CROSSLAND SUMMER INTERNSHIPS. SO POINT BEING, WE'RE VERY INVOLVED IN THE COMMUNITY. WE'RE ENGRAINED. WE'RE NOT PLANNING ON GOING ANYWHERE ANYTIME SOON. AND SO LAST FALL, SEAN AND I, WE RARELY GET TO with his working in the classroom, we never got to go to lunch, but we happened to one day, we had both seen a Facebook ad that the corner patio and the attached property was for sale. We were not looking for property and we just, we looked at each other and we thought, Well, maybe we could pull that off. And so by the end of the week, we were signing a contract to purchase the building. And again, we weren't looking. We just thought we couldn't pass up an opportunity to invest in something. And I specifically, I told Sean multiple times, just the thought of owning something on Broadway, my hometown, put a sparkle in my eye. And I didn't know what that meant, but I thought that meant we can't pass it up. So we went for it. And so, like I said, the building was built in 1930. This is what it looked like back, I believe, in 2013. And so, the previous owners, they did put a lot of work into it. Here's what, oh, I'm hitting the wrong button. Here's what it looks like now. And so, they completely gutted the building. They did some framing and they put some electric and plumbing in. They started that, but we need to finish it. We need to restructure walls. We need to level out floors, adjust the plumbing, install more lights, and HVAC. And so what I'm focusing on is that back west portion, so units 3, 4, and 5 is what we will be remodeling. 1 and 2 already holds the Airbnbs that we currently run, and then obviously the corner patios in the back.

You said one and two are Airbnbs? They are, yes.

The previous owners created that, made them, they're really great, and people, we just had, all summer, we've had someone almost every weekend booked. So it's fun to see who comes to Pittsburgh. So we want to keep those going. But, so, and that's, we intended to finish it out as Airbnbs until, again, one of those things, I just kind of thought, well, Sean's changed his career. I said, I'll go ahead and try and change mine. And so in April, I left Fleming Law Firm, and I thought, well, why pay rent in another building when I can just remodel a building I already own? And so this is where we're at when we purchased it, kind of what we're looking at. They did a lot, but there's a lot that needs done. And so height law is what I intend to obviously put in the back units. And so talking the numbers, the actual purchase price of the building was $325,000. I'm not asking for any money to make any changes to the corner patio. And so I thought it was fair to remove that square footage from it. And so... regarding what I presented to the EDAC was a purchase price of $250,000. And then after speaking with, we've talked to a couple businesses in town who've given us bids, quickly realized how expensive remodeling a building was, definitely higher than I was expecting. But we're still shopping around, but the numbers that we've consistently gotten were around $150,000 to finish out the last three. And so I kind of broke it down here to what we're expecting. And so my total number is 400,000.

So your office is going to be the part of the building that's adjacent to the roadway?

The back, yes. So what you see there is corner patio one and two. And when I go down, I rotate it west. So that's looking west.

Do you deal with doors and windows at all? Do those remain in different access, or it's just...

What I intend to do, again, because I want to keep the integrity of the building. I don't really want to break down too many walls. And so I intend to leave those doors as it is and potentially just put a giant awning over. Because those back two would be entrances potentially to where my office is and then the entryway conference room area. But so overall, again, I grew up here. I went to law school to become a lawyer, and I knew that in the end I wanted to come back to my hometown. My law office is a general practice, so that means I try to do a little bit of everything. I kind of refer to it small-town law because I get fulfillment out of being able to pick up the phone and help someone's teenager who got a ticket for the first time or someone who's going through a divorce or someone who needs help with a will. And so I love to be that person. And now I get to be that person and operate out of a business that we own on Broadway. But now I have to turn to my community and ask for some support. And so I requested from the EDAC reimbursement of up to $40,000 for the remodel of my 919 North Broadway. Okay.

And I will add, commissioners, there were lots of things the EDAC liked about this project. First of all was the fact that, as Kaylynn said, she wanted to make this investment in her hometown. In fact, I think she opened her presentation to the EDAC that she always wanted to own a business on Broadway. Secondly, if you look at the trends, communities of our size are having trouble attracting young private practice attorneys. It's becoming more of a challenge. So to be able to invest in a private practice attorney that will be here for several years was something that was also very valuable or attractive to the EDEC. So with that, we'd be happy to answer any questions you may have.

I appreciate that you've invested in yourself and your marriage and your giving back to the community and wanting to do something to help revitalize. Growing up here, watching that facility and the condition it was for decades, it was hard for people to look at. And knowing what it was, it was a liquor store many, many years ago and a daily rental motel. So seeing it evolve into something like this, and the previous owner did quite a bit with it too, it made it less of an eyesore and more appealing to everybody. I think it's great.

I have a question. Since you're the boss lady, where are you going to park?

I know. That's the one. There really isn't. We do have great parking there. However, I'm not going to be able to hide. I know. So people are going to know when I'm at work. Park at the corner patio and sneak in.

You're going to have a great lunch spot for all your lunches. That's right. And coffee. Yeah. Anything else? Motion to approve.

Second. Then a motion and a second to approve.

As a very proud, great uncle, I'm going to... First.

To avoid any conflict. Yeah. All right. Then a motion to approve and second to abstaining. All in favor say aye. Aye. All opposed, same sign. Motion carries. Good luck. Congratulations. Thank you, guys. Thank you. Very cool. Eagle Pitcher Technology, final change order number 12, consider staff recommendation to accept final change order number, no, 12, number two for the Easter pitcher technology LLC project.

Mayor commissioners. So items BC and D are related. Um, B is in fact the final change order. Um, looking for your approval of that. Um, the next one is the final pay application. which will file out the project all in preparation for item D, which is the purchase agreement between the city and Eagle Pitcher, which authorizes you to have us take that action this week so we would close on the project. I have Lee and Dan. You're just going to talk? You got it covered? Anyway, we have Eagle Pitcher here if you have questions, but we can take these one at a time, but they are all three related.

Good evening. Thank you. It's exciting to be here. Really appreciate the partnership that we have with the city of Pittsburgh, and we're looking forward to as we expand our footprint here with our second location. As Darren mentioned, we're interested in finalizing the purchase there. I know we initially entered into a lease agreement, and we're looking to accelerate that and pay off the building down.

Yep. I guess I would ask you to explain that. There's a lot of people in the community that have reached out since this agenda was published. They're not understanding how the process is working with the lease being reduced in time and the purchase agreement. So if you could just briefly explain how this is working and what your intent is.

Sure. So first of all, I appreciate the willingness of the city to... Put your money where your mouth was last year and help us move forward with this project. Eagle Pitcher is in a different place this year than we were last year. We've had some business changes. Everyone knows the world is in a different place. So we are a battery manufacturer, sole source on 90% of the munitions with our U.S. Defense Department. and so our business is strong, and we're looking to really accelerate what we're doing in that building, get that building up and running, and we're in a position where we can, I think we can take more ownership there, and hopefully make it a beneficial situation for the city too.

Any other questions? Move to accept. Second. B, C, and D in toto.

Can we do all three or do we have to read them all?

I would suggest you do separate.

So that's just for the first one, Doc, item B. Your motion? I second it. I'll say all in favor say aye. Aye. All opposed, same sign. Motion carries.

I would move to approve C. Second.

Move to approve. Motion to approve and seconded to approve. Uh, C, all in favor say aye. Aye. All opposed, anything?

I'm sorry, Mayor. I think Henry wanted you to... Oh, read it? Yeah. Do we need to go back and read item C? No, no.

Okay.

Same thing with D? I've got a question.

D is... You don't have to actually read these. You know, we've got a published agenda. It's just typically we do it for the public's benefit. We make you do that because we're honoring. No.

Did you have a question? On this D, what's this paper compared to our packet?

There should be two changes. One is the title company. Okay. It says, I think, Chicago title, and they sent one over today that says security first, I believe. Oh, okay. The second one is the original 7-9 didn't include the payments already made, so they adjusted the amount to, I think, it's $8,000. something to reflect the payments that Eagle Pitcher has already made to the city over the last six months when this thing started. Okay. Those should be the only two changes. But this trumps... The one you were handed trumps the one in the packet, for sure. Yes. Move to approve.

So what was the motion for... I wanted to know, we were handed this, and I want to make sure this trumps our packet.

Okay, but your motion...

To approve. To approve. Item. Item D. D. On the new change.

All right. So that's what we're talking about right now. Mm-hmm. Motion and a second? Yes. Moved and seconded. To approve, all in favor say aye. Aye. Aye. All opposed, same sign. Motion carries. Thank you. Thank you.

Good luck. Thank you.

All right. Mammoth Sports Contract, LLC agreement, adenum. Consider staff recommendation to approve the adenum. to the agreement with sports construction and LLT to add additional scope of work and to modify the payment terms of the agreement.

Mayor, city commissioners, open. You guys keep sneaking up. Take it away, brother.

Sorry. As you know, the Don Gutterich project that's going on with the turfing and everything started with the bond issue you guys approved. And it was going to do the three infields at Stice, Cardino, and Wildredbury. Then we got a private donor that went in to do all of Stice. And on April 28th, we went into contract with Mammoth to do those. And since then, we've had, obviously, more donors step up and everything, and the scope of work has really expanded to actually including, we're going to be doing all of the sports jerseys, or all of the field, that's the wrong one. And so this is what Stice is going to look like, and here's Carnino. But we're going to go in and we're going to turf all of the fields now, the scope of work changing to that, and then also JC Ballpark is getting new infield and outfield. So what we're asking today is just to assign the addendum because we're changing the scope of work with Mammoth from just the new contract with them on top of the April 28th one we had there because the scope of work has expanded.

This will include the turf.

What's the other, what do we call it? Stabilization.

And Blaze is here with Mammoth. Come on up, Blaze.

Yeah, I have some questions on what we have in this book. Is this just a rendition, or is that what the fields are going to look like? And the reason I ask that, Cheryl Stice and Ted Carnito, the infield of Brown, and then Bill Russell, what else, Dale Connor, Jim Kelly, they have a green Is that how they're going to look?

Well, this is what Bill Russell, this is the actual picture that's going to be. It's going to be the brown. See Wild Redberry, we're adjusting the fence in a little bit. It will also have the green turf. So the only two that will have green turf on the infield are Wild Redberry and then JC.

And what's the reason for that? For baseball.

It's more of a showcase baseball. Okay. Kind of like the championship.

Oh, okay.

And then the rest of them is going to be the brown infield to make it more universal in there. Sorry.

Typically softball fields are brown in the field.

Is that what J.C. is going to look like then?

That's J.C., what it's going to look like with the extended bullpens and everything. So baseball's got that look.

Baseballs have a green intro.

And then this will be Stice. This will be the...

I have some other questions, but it's on back in the back of this book here.

Well, I thank you for allowing me to be here for the third time and enjoy sitting in these city commission meetings. That booklet, what we did is I asked them to put that booklet together. The easiest thing to do had been just rip up the old contract and start over, but Henry wouldn't let us. So we did the addendum. So we were all kind of getting confused. So if you look through that, basically it just shows the first part of the – agreement we had for Stice and Wild Redberry and Parnino. And then it shows the additions, everything moving forward. And on each of those fields, you'll see what's in the base contract right now. And we also put to the right alternates that Mr. DelSeg is working to raise money for.

Okay, that's the question I had on the alternates.

Right. Those will happen if he gets the money, and if he doesn't, they won't. But I'm betting he will.

So if they happen or they don't happen, can you explain what they are? The maintenance equipment, you're going to need, it has one Pioneer Chief field sweep. That's going to be needed, isn't it?

Yes, but you don't need one for every field. Right. Right. Every time I'm here, I have trouble with that door.

I'm starting to think it's you. I think so. What's this 350 foot, maybe, portable fence? What is that about? What's a portable fence?

Portable fence that you can put on a field if you want to make it a smaller field for smaller age levels on one of your big fields. Pretty common in a lot of parks. They can bring the fences in, basically.

Okay.

And the shade structure, what is that? Shade structure was something that y'all requested.

Yeah, just throughout the park, just extra shade and everything, whether in between games or something like that. There are plenty of trees, but it's just...

The contract you have in front of you is for turf stabilization and the fence around the outfield. All the alternates that are listed in there... No, let me finish. Okay. All the alternates are the additional items that the community has identified that they're doing a fundraiser for. There's two and a half, maybe $3 million worth of those. Blaze's company does everything. So they're going to be responsible for putting it all together. So they worked with us to say, okay, on this first section, the donors specifically wanted to make sure we had turf stabilization and you have to put the outfield fence in when it goes. So that's what you have before you tonight, and that'll finish that off. The rest of it is being fundraised.

So we can't ask any questions now? We got alternatives?

You can ask any questions you want, but the contract is for those things. On this last page, it's kind of a cafeteria. It's more, you know, what do you want? And we gave him some numbers and prices for that. I know one thing, uh, Mr. Del Saga, he would like to secure seating and bleachers. Those lights are pricey. Uh, he did ask how, how quickly would we need to have those in place to get material supplies in to do that? Um, and backstops, but he, we have pricing for backstops with an egg in the pole system. So he, he, he has numbers he's working with.

Yeah.

Uh, and he may find some cheaper options too. Uh, and I do think his goal right now to, to, to do this is about 2.5 million. That's what he's after.

Okay. So my last question, what's a video board?

A video board is a board. It's a scoreboard and you can run advertisements across it. Um, Somebody had asked us to price that. I think there was one particular donor that might have bought that video board for that field, and they can run...

So that's just for one video board, but the rest of the fields, they have scoreboards, won't they? Yeah. But the video board will be somewhere on a field if they raise a money for it?

If you also choose to do it.

The video board can show the image of the scoreboard? So you can keep score on the video board, but in between innings you can flip up ads or you can show CNN or whatever, or Fox, whatever your preference is. But the video board is just another name for a scoreboard. There's a million, there's $5,000 scoreboards and there's $55,000 scoreboards.

The university has a video board now.

Yeah, I mean, it's just, they were asked to quote it because, once again, all these assets can be provided by Mammoth. It doesn't mean they have to be. Right.

And you also have a cheaper scoreboard. The video board is an expensive scoreboard.

Let's just put it that way. It's pricey.

When we were talking about this before, you brought up you won't know until you get in there. As far as the adjustments for your estimates for the stabilization allowance, once you dig in, are you...

proceeding anything moving forward have you found anything that indicates with you guys did a topographical they've done some preliminary tests need to do a geo and that's just basically protects you from a change order come and say hey we got salvage yard body not body parts car parts yeah it could be who knows yeah and i've seen i've had some fields where they've used it they found all kind of things out there and i have some fields that use very little of it uh or if any so but you're confident with this stabilization change that's going to cover what's needed they have had conversations with with folks here in town, I guess, your people, and we do know that, I don't remember which field it is, there are a couple fields that are gonna have some issues. They're going to eat up some of that stabilization. What's under there?

Trash dump.

My first month here, you can see the dump.

You never know what's under there.

It's about 10 feet away, too. Don't find any Indian things out there, your dumps.

I do have one other question on the drainage. The field's got to have some kind of system piping, draining, where will that water go that you're draining off the field, or even when we put the road in, where's all that water going?

Well, JC will go into the creek ditch. The other places, it's going to go to, I haven't looked at the exact drainage plan, but they're going to drain it. Gravity works. It's not going to go into the city system. No, it'll go into the creek.

It'll go into the natural drain as it runs down the park.

It's going to go west at some point in time.

built drainage system under each field that will channel it to wherever the natural drainage system is through the park. There's not going to be a retention pond or anything, not anything more than we already have out there.

There's not a retention pond. Those fields kind of serve as a temporary so that water releases slower because they'll hold water underneath there before it just goes out in a gush.

Right.

But, hey, I do want to thank you having the trust in Mammoth, and I want to thank everybody for having a vision. I know Darren's worked hard on this and Joe, and you're very, very fortunate. I've had some people step up to the plate because they want to see it done, and it's quite an amazing thing that's come together pretty quick. I know you all have been planning and talking about it, and we're excited. I think we're going to get started August 1st, if you tell us that's okay.

It sounds like August 1, it's going to start. And moving a ton of dirt is the beginning. So the city's going to use the dirt. It sounds like that saved us a little money, too. Chris has got a nice little corner of the world for all of his dirt. Move to approve the addendum.

Second. There's been a motion and a second.

And the addendum that you're having, that's here.

The most recent addendum. Yes. All right.

There's been a motion and a second to approve. All in favor say aye. Aye. All opposed, same sign. Thank you. Thank you. executive session. An executive session is necessary to discuss the confidential affairs of a corporation pursuant to KSA 75-4319B4 to discuss confidential corporate affairs. Motion to recess into an executive session for 30 minutes. to discuss confidential corporate affairs pursuant to KFA 754319 with the meeting to resume in the commission room in 30 minutes. Is there a motion to recess? So moved. Second. And moved and seconded. All in favor say aye. Aye. All opposed, same sign.

Thank you. Bye. Thank you. Thank you. Bye. Thank you. So, Bye. Thank you. Thank you. ... ... Thank you. Thank you. Bye. Thank you. Thank you. Bye. . . Thank you. Bye. . . Thank you.

Recess an executive session, but we need an addition of 30 minutes for an executive session to necessarily discuss the confidential affairs for corporation pursuant to KSA 75-4319B4 to discuss confidential corporate...

affairs.

Is there a motion for an additional 30 minutes? You might just state that no decisions were made. Oh, yeah.

No votes were cast and no decisions were made. We're just asking for an additional 30 minutes.

Second.

It's been moved and seconded. All in favor for the additional 30 minutes? Aye.

. . Thank you. Bye. . . Thank you. Thank you. Thank you. Bye. Thank you. Thank you. Thank you. So, you Thank you. Thank you. Thank you. Thank you. Thank you.

No decisions were made, no votes were cast. Is there a motion to adjourn? So moved. Second. We're moving to second for adjournment. All in favor say aye. Aye. All opposed, same sign. We are adjourned.