Town Council - Regular Meeting

It would have been convenient cuz I'm like my schedule

Good evening. I would like to call to order our first budget workshop of the season. So, thank you all for joining us in council chambers as well as those that are joining us on our YouTube channel along. We do have one quick item um a consent agenda item that you would have seen in your packet. We had already approved this, but instead of having to wait until our March meeting um since this is a public meeting as well, we wanted to go ahead and do the consent agenda for consideration of the contract with code right to modify the UDO development ordinance. So with that, is there a motion to approve consent agenda as stated? Motion to approve. Is there a second? Second. All in favor?

Any opposed? Great. Thank you. The motion is carried. And with that, we will have Rob kick us off for our budget workshop.

Well, thank you, Mayor, and welcome, council, mayor, couple members of the community, and and a whole bunch of staff. Um, and then everybody watching at home. Um, excited to kick off workshop one here for the budget season. I will say, um, ignore the the the shirt and tie. We had meetings earlier today. Um this is an informal meeting. So you know we do have a lot more back and forth available in in our presentation. So if we have questions, we want to discuss anything. Um we don't really have break spots to to have kind of open discussion. We're just looking for that as as you see it here. So don't feel bad interrupting or saying, "Hey, can you can we go back a couple?" Um we obviously like our staff to be here in case there's anything that that comes up that we want to um dive deep on. We also um want them to kind of have a a first-person perspective of the type of conversations that we're having here. Um also we have one person here with us uh with Casey. Casey, did you want to introduce

um Liz? Yes. Um this is Liz. She will be uh filling in for me as communications when I am out on maternity leave. Um hopefully in March any day now, but we'll make it to March. Um, so she will be kind of point of contact for communications March, May, April, and May. So, right. Yeah. So, surprise, Casey's pregnant.

And, uh, and we're very fortunate to to find Liz. Liz is a a Harrisburg resident and somebody with municipal experience and obviously communication experience as well. So, um, she I believe you'll be sitting in some meetings next week with us, right? We'll just have a little bit of overlap so that Casey can go ahead and and take a nice uh parental leave and get used to not sleeping anymore. Welcome, Liz. Thanks for being here tonight.

And I do plan on getting us out of here um by 8 this evening. So, uh for those of you that have a heart out, um that's fine. You can gohead and kind of count on us being out of here at 8. We do um have this broken up into a couple of sections. U first we're going to go through our council retreat recap and just really put the information out there both for um the two that couldn't make it, but also um go over just a lot of our results that we had there. We'll also have a section on the process between now and the uh what we call draft one budget meeting. go over some of our uh survey results from the one Harrisburg plan as well as talk about all the kind of challenges and some of the economic things that we're facing as well as the opportunities that that we think are coming up and then an ultimate wrap-up session for anything. Go over our next steps, look at the um year ahead of us before we get into draft one. So objective for today, what we're not doing, um, we're not recommending a final budget today. We also are not doing a tax rate recommendation. I try to make sure that that's clear before we we get started that these first couple of meetings are very um directionbased. We'll confirm the themes and priorities that that we talked about at our retreat. We'll also go over the summary of the community and and council priorities as a whole to make sure we have alignment on all of those things. the discussion of those those headwinds that we had talked about and really just where we're heading. So, as you guys remember, we were able to meet on January 24th. Um, besides getting smoked out, it was a very uh successful time. I I was I was worried about keeping everybody in the room, but we did make it through. And a lot of what we went through there with with

Central Lina guiding us was recapping those key principles that our vision statement and mission statement um have in them and make sure that those are still relevant. Make sure that you know some of that clear direction that we have in there if we're going to move off of it a little bit or or or redirect on where we're going to go. And I think um we got through quite a bit trying to beat the impending ice despite having to take about a half hour break to to beat the uh um smoke detectors to death there. I think I I took it off the wall and put it outside. So that was interesting. Um, we went back through our strategic plan, the 45 tasks that that we have in our 5-year plan and discussed the 38 that we've completed as well as the seven that we haven't and confirmed that, you know, we have those two years remaining to to kind of accomplish all all of the rest of the goals there. However, we think we're well ahead of schedule and have a plan to really knock those out be by the end of the year and then hopefully in next year's retreat, we can take a look as you know we have one or two issues that are lingering and just refresh that went over the state of the town as well as um the transportation parks master plan survey results. Sorry, I might be going into No, this is last one. um survey results from the one Harrisburg, the economic outlook and forecasting at a different level were all gone over there at the retreat. And then we went over the survey results that you all did for for homework. So, we sent that with you in December. We're able to tally all that up and really look at our top priorities as a board. Um this was exclusive of the one survey or the one Harrisburg survey results, any of the staff input. This was just really in a vacuum individually. What were we looking at? And we saw the top

priorities is transportation, traffic and connectivity. Um some specific things there with the Caldwell, Highway 49, Morehead West, as well as community spaces, um greenways, sidewalks, land purchases. Most of these things sound familiar and and were reaffirmed there. As well as kind of some of our challenges that that we know face us to accomplish those, the traffic congestion, um the investments, the the um grant funding that we have coming in that kind of delays the scheduling of some of these things and discussing are those schedules valid or do we want greater investment to move schedules? I will kick this over to Brian where we'll go over the results of the exercises that we were able to do there. As you guys remember, we tallied a lot of stuff. And so now we got some graphs for you. And when we have graphs, that's when Brian jumps in.

Thank you, Rob. So yeah, we did get to do a bird bug exercise at the retreat, but didn't have time to actually look at the results live. So we have those here for you tonight. Just as a reminder and for those that aren't familiar with the Bird Bucks exercise, this is essentially a zero based budget exercise. So, we give each council member $50 of Bird Bucks and provide these um these categories to invest in and um really no instruction other than that. So, just what are your priorities? where would you invest if you have the opportunity to uh invest those unencumbered um with other considerations and see what the group thinks. So this year in particular we see a really tight clustering of all the results. I would say you know the vast majority of items here are from about 8% to 12%. So not not much difference between investment priorities for the group. So that that was interesting this year. Um, but the two that did rise to the top were transportation and economic development. So that's not a surprise to anyone in the room, I don't think, that those two rose up to the top. And when we look at the results over the course of three years, uh, you can see that those have been focus areas all three years. So um, we've been lucky enough to be able to do this for three years and keep the the categories consistent as we've done that so that we can compare. We know that some of the people seats have changed um and obviously the conditions have changed but um we like to put these same functions back in front of you and have you repprioritized. So again transportation economic development we're at the top this year but when we look at these from year to year and you can take away various different things. So I like to look at how do things compare in in the current year. So looking at all the red bars, what were the priorities that that you

chose in in the current year? But then also how have how have some of these categories moved from year to year in relation to each other. So when we have, you know, police being one of the highest ones in 2024 when we expanded the sheriff's division, that was really at the top of everybody's mind and something that we really needed to move into um in the next year. you know that that stepped back a little bit but still stayed a high priority and that continued again in the third year stepped back a little bit but still as you look across this entire chart here still a really high priority. There's other functions like planning and zoning that in 2024 with the blue bar there you see that it it wasn't it was one of the lowest ones on out of all of the departments here. um in 2025 that took a little step up and then in 2026 confirmed that we need a little bit more focus into this into this function and you'll see on the next uh prioritization slide of of what that's probably hinting at. So this is the department investment when you have a zerobased budget where would you put that in but then the next step is dig into what is underlying that um that field that you need to invest in that department. And so that's where we get into the prioritization. We call it prioritization 3.0. It's the third year that we've done it. Um, but here's where you're digging into more of the functions uh rather than the department. Um, so correct and rewrite the UDO is one of the functions of the planning and zoning department. It didn't have too much attention put on it in the first year, but as you can see over the three years, that's become more and more important to to council is to let's solve this UDO. let's get it working for us in in a positive direction. So, that's something that we certainly take away from that is what what's happened over time and and try to glean from from the council uh the focus areas that we can apply the budget and our attention

and our effort into as we move forward. Um, you know, the nature of this um exercise here is that we're going to have things that pop up and become really relevant and then die back off again. And we want to show those. We want to keep these consistent across many years as well to see kind of the life cycle of of some of this stuff as it becomes important. So, you know, the reval is one that popped up in 2024 as we were really talking about it and talking about our communication strategy and and our um our messages there and then it's just not relevant the next two years, but that will start probably start to come back into the top of your minds in the next year or two as we get prepared for the next uh reevaluation cycle. So, so those are the things that we're looking at here. We're trying to um to extract some underlying information from that and then apply that to the budget that you'll see throughout this season. And so again, our our highest concentration areas on this chart, we're correcting that UDO infrastructure, which ties right back to streets and economic development, uh which ties exactly back to the bird bucks exercise as well.

That's it for our council survey. Thanks. Hey Brian, before you leave that previous I mean I think it's the other thing for us, you know, to correct or rewrite the UDA may cost us $200,000. Park and land acquisition maybe $10 million. Absolutely. So there's no scale here, right? Yeah. This is just a kind of a level of effort and attention budget.

Okay. So, I did steal one of these uh chart and graph items from Brian. So, thank you for letting me. Uh brings back great memories. Uh so, if everybody remembers the survey themes exercise, that was uh from whenever you did your individual surveys that the question was asked, what would you the your top two prioritized items um for to be done within the next year? And so we accumulated all that information and at the budget retreat we actually gave everybody I believe it was six dots uh per person and had everybody rank their top priorities out of the list. And so what came out of here as you can see is diversification of the tax base as the very top. No surprise there. Um land banking is the next highest. something that both items we've been talking about for quite a while now. Uh if you go down, I went ahead and brought in everything over 10% just to show you the Morehead West Caldwell Road development is another one that was a top priority that we're currently and have been working on for a while. Uh sizable economic development results, Ryan, that's your task there. uh you know, council's been very supportive for us uh with economic development and it only makes sense that you want to see the results from that. Uh the one that was surprised I think for all of us was the community center. Not that it is not something that we've heard about, but to shoot up in the rankings as high as it is, uh I think demonstrates that it just seems like the community center is an idea, a project that is beginning to rise up on on people's minds. So, uh, that was an interesting one. But a lot of these, as you go down the entire

list, they're they hearken back to transportation, economic development, getting Town Center up and moving. So, not a whole bunch of new stuff here, just continued focus on what we're doing. And, uh, that's what I wanted to make sure that we get across there on that one. Just clocking time here. Just clock time. Did I get good? So, so

we had two other items that, you know, I I have as a summary here before we get into um some opportunities for for questions were the emerging themes. You know, what were our opportunities? We discussed this at the at the retreat. We talked about, you know, what in the parks master plan is achievable in the in the short term without going out for the big, you know, $50 million type onetime expense. And we talked about opportunities to partner public private partnerships like the Divine Park project, finding our our southern park as well as our programming and opportunities for library community center in uh town center. And that really tied in with again the other themes that we had there of revitalizing town center, economic development, transportation. These all melded together really well. Um, Harrisburg Common Park out here in front of town hall as a common gathering space to drive visitors downtown to experience that along with the the retail and the other development that we would look to drive. Then the final one was we talked about um cost burden. So the the burden for you know folks that um live in Harrisburg really live anywhere right now and the discussion points of these taxes are big burdens on the cost of housing. And we talked in the retreat in a a less graphical way uh about what is our share of that? What burden do we put on as a local government? And so, you know, I'll I'll not bury the lead here. Um, if we were to wipe out an entire department, let's say, you know, Jim burnt parks to the ground and we sold all our parks and we didn't do the Fourth of July and we didn't do the parade, we got rid of all of our rocking the Bergs and we didn't do Bags in the

Berg help. And we just completely all 4,000 of our soccer players, we told them just go home. We're not doing it anymore. Our 2,000 basketball players, go home. We did nothing in parks. then we would save $36 a month off of this house payment. If the interest rates are dropped by the Fed a couple of points, you'll save $600 and some dollars a month. Right? That's really the story is that if we blitzed police, you would you'd save about $30 a month. If you blitzed parks, you'd save about 30 a month. But the main drivers of this are principle and interest. if if the rates went from 5.6 down to, you know, 2.6, then you're saving hundreds and hundreds of dollars. And I'll walk us through that. So, we did this graphic here, and I, you know, thank Brian uh for pulling this together for me. I'm sure Casey, uh, jumped in and help this. Looks like Casey's handiwork. Um, but we went ahead and and made some assumptions on if you have a home value of 550,000, a new house for sale in Harrisburg, and somebody's moving into Harrisburg, assume they they have a sizable down payment, so they're going to borrow $400,000 at the average interest rate of 5.6, which is basically our our market right now that that somebody' be looking into. Then the total house payment for them would be $2,917. Of that 2,917, $1,78 1,387 would be interest. 98 would be principal. The insurance on the house would be 172. Property tax for Cabaris County would be 263 and property tax for the town of Harrisburg would be 187. We we make up 6% of that total payment.

The other 94% we have no no influence on. And what do we do in that 6%? We provide 32 deputies to to the residents. We provide 54 firefighters to the residents including, you know, the them being first responders, right? Most of the calls we do are medical calls. Um we also pave your roads in in that amount. We also provide all of those parks and recck services that we talked about, including owning those facilities, all the services here at town hall, u planning, engineering, finance, um you name anything that that you have an experience with out there and it's all covered in that $187 a month. plowing the roads.

Plowing the roads when when we have these events. Swiftwater rescue team going not only here but out to the coast and out to the mountains when when folks need them all around. Um we can go on and on. I'm sure I'm leaving, you know, folks out here. And I I'll apologize for that. But everything that we do here to to provide public safety, to provide good infrastructure, to provide a great quality of life, which our residents believe they have, we do that for about the cost that it takes to ensure your roof from hell damage. So when you put it into perspective, I I think it's important that that our residents know that that we in this this room know that that one, we don't have a big opportunity for cost burden. Um, but we'll walk through some scenarios and that we're providing a good value for the amount of money somebody pays. Um, I'll also point out that, you know, television services are about half of that, right? I pay $90 a month for YouTube TV. Um, that's the same amount that we pay for our entire public safety, police and fire combined. So, I don't turn YouTube on, but a couple times a a month, usually football season is the reason I have it. and I I pay that and that's the same amount that all the deputies and firefighters cost us here in the town of Harrisburg. So, let's let's go through that example that I just spoke about. Let's say we um we didn't have a parks and wreck effort here at all. We had no parks facilities. We didn't do any athletics. That $2,917 mortgage payment goes down to 2,881. We dropped the tax rate all the way to 33 cents, but 2917 to 28.881, I'm not sure that's the affordability impact that I hear from the state legislature or from the general public. I just don't think they

they understand this. And this is an important message for us to get out there. Let's assume again that you know we we didn't do any parks and recreation and we got rid of millions of dollars of expenses and insurance went up 15%. I'll tell you my insurance went up 100% last year and I had to switch carriers to get it down to 50% increase. So, a 15% homeowner insurance increase is is likely. If that were to happen at the same time that that we eliminated an entire department here, your monthly mortgage payment would go from 2,917 to 2,96. It it it's not the affordability effort that that we hear constantly um throughout the state. There are things in here that that can be done. I think, you know, one of those, let's let's say the Fed keeps cutting rates, we get 2 3%. We go back to where we were at in 20122 where the average mortgage interest was 2.75%. Well, all of a sudden, that bill goes from 2,917 to 2300. A homeowner saving $617 a month if interest rates were not where they're at. That's a that's a real affordability issue there, right? That's $3,600 a year. Sorry. And those are things that our we're not we can't do here in a local government, but you can do as elected officials as we go out and we we lobby and we advocate for programs in our state that other states are doing. There are programs in most states for first-time home buyers where you can have guaranteed loans that the state government will will guarantee. Um there are also um hometown heroes programs

where they'll do down payment assistance and mortgage point buys for cops, firefighters, teachers, people that graduate at inschool um universities to stay in the state. So I I think as we go through this property tax analysis at the state level, it would be good for us to go ahead and write our senator and write our representatives and say we have some ideas for this crushing house payment that most people have. And I don't think it's cutting police. I don't think it's cutting fire. I don't think it's cutting the things that people want the most in their local community because we have very little impact. It might go down at most 40 bucks. It might go down as little as five, six bucks. Uh but we know where there are hundreds or thousands of dollars of savings and that's in helping in the principal interest and the insurance realm. Insurance is regulated by the state and there are things that can be done there as well. So, um, I wanted to go through that because I know I know we've talked about that, um, a few times on getting that message out. I think this is an excellent graphic. Want to thank Casey and and Brian for putting the numbers and the pictures together and we plan to continue to to kind of push this through our budget process as an educational piece. So, what does all that mean in in the grand scheme of things? At the end of the retreat, at the end of all of these surveys, at the end of all the data that that we've gathered so far, we've we've gotten to this point, which is our launch point into the rest of the budget, we've confirmed the vision and direction. We like the progress that that we're making on the existing strategic plan, and we want to do a push and make sure that we're finishing that. Continue our operational philosophy. We're we're making great strides, and we're we're getting great numbers. We're getting great benchmarks. we're succeeding where we want to

succeed and now it's really time to kind of prioritize as necessary. There are areas that we've spent a lot of energy and resources on making uh good success and and good progress. Now, there's some other areas we can push into that that are um that we can move those resources to pursue opportunities have a high impact with partners whether it's public partners, private partners, grant opportunities. And then we have our kind of our two main focus items for this budget. Transportation and economic development. Those have come up from our community over and over. They've come up from this board in every way that we've managed it or measured it. It's come up from our staff every time that that we've brought it up. And what does that look like specifically in the transportation realm? Continue our existing projects. We have over $20 million of existing projects that we need to to make sure we're bringing to fruition. Um, but also continue to discuss the neighborhood protection, making sure that we don't fundamentally change the character of our existing neighborhoods versus how much traffic improvement can we really have. I think we'll do that throughout the comp plan, not just this budget. and then pursue those preliminary and detailed engineering plans on transportation projects even if we don't have capital funding for them so that we're ready when funding does become available be it at the federal state level whether a private partner comes in whatever it takes having those kind of shovel ready projects and and plans on the shelf are something that we want to continue and on the economic development we really broke it into two categories of town center and Morehead West. Everything else is kind of, you know, it's still in there. We're still pursuing all those opportunities along 49 corridor and out at Farmington, but Town Center is really a main focus for us in in this upcoming year. I think as we go through the

budget, we'll find some opportunities there with Harrisburg Common Project, um retail recruitment, educational um opportunities, a library relocation, community center, train station opportunities. Those are all economic development, town center focused items. And then as we go out to Morehead West, that's really where we want to diversify that commercial industrial focus. uh diversify the tax base, fortify those those revenue streams so that we are uh more hearty in a economic downturn and are taking opportunities of all the properties that we have. Do I turn it over as I keep going here?

Okay. Do we have any questions on any of that so far?

All right. So, don't get too excited. I know this looks like the end of every meeting. Uh but it's just a refresher in the middle of this meeting. Uh so, we are currently in workshop number one. And so, um just an outlook for the rest of our season. Three more workshops, our public hearing and adoption in May and June. But I want to um remind everyone of what you'll be expecting for workshop 2, especially our new members. Uh what's in store for you there. So on this is our Saturday all day workshop. Um and it will consist of department presentations from each department head uh that's sitting behind you. And they they'll give you a brief history of their department and how it fits into the town. uh the duties and responsibilities that they cover as well as uh the programs that they that they put on. Um they'll mention any changes in operations or any significant changes in the budget for you. Um so that you don't have to really comb through that budget to detail report that we give you um or that that year-over-year report. Um you'll be able to to see those changes in operations or budget impacts from the department. Um as we know all the departments are working on innovations, efficiencies, goals and measuring their performance on all those with benchmarking. So we'll discuss um how they're doing this year on their current set of innovations and goals and what they have in store for next year. And then each department has a 10-year personnel plan and a 10-year capital plan that they'll go over with you. and any capital that's being requested to be funded in the current year uh will have a more in-depth explanation and justification for you. So, um we provide a budget book about a week or so ahead of that meeting. And for those that have been on council for a while, you could probably build a small garage or something with with a stack of those books. uh it's massive and um but it contains a lot of great information and um we want to make sure

that you're seeing all of that detail in extreme detail as well. Uh so each department has a a series of cover sheets that are a five-year trend so that you can see that department performance over time. Uh each department of course will describe and show you their org chart and how they operate. And then the the majority of that uh really large report is this budget comparison report here. And um people can get a little lost in this report. It's not the easiest one to read. So I just wanted to point out um a couple of the features of it. So if you see the two gray highlighted columns on the right side of the the screen, there's the parent budget and that's the current year budget that we're in right now, fiscal year 26. There's the comparison one budget which is the 2627 department request or the proposed budget that you'll be voting on. And the real key to understand is that underneath each account is two groups of information. And so we want you to know the detail within those budget numbers. So for the example that I have here is a uniforms account. You can see that it went from 2400 in the current year to 1,600 in the next year in the proposed year. But the natural question would be what's in that account? Why is it changing? What you know what what can I expect to see there? Um so we provide that detail underneath the overall account um budget number there. And so you can see that we had two items in the current year that make up that $2,400. And there's one item highlighted in green that makes up the $1600 in the proposed year. So for each account, you'll have that accounting of what's in the current year and what's in the proposed year. So you can see if anything changed, items that have been added or removed. Um, a lot of them stay pretty pretty uh bland from year to year. You'll see higher on the page travel and training is uh the same line item and it's the same from year to year. So no change there, but you can

always see the detail that makes up every single account. And when we when we give this out, um, you have a week or so before the meeting. So really encourage you to look through this, make any notes, um, come up with any questions that you have. go ahead and reach out to any of us or the departments before that meeting and get some of the quick hitters answered so that you have real discussion topics when we come in on Saturday and you can ask those questions to the departments. It will turn the page there to an example of a capital improvement plan. So like I said, each department will give you a personnel plan that looks something like this as well as a capital improvement plan. This is an example from the water and sewer fund. So, you can see we have projects broken up into different categories, whether they're a capital project fund or operations, and they're completely scheduled out and budgeted over the 10-year period. This 10-year capital improvement plan obviously folds right up into the 10-year financial model. And you'll know that every budget that you get along the way, as well as um as far as the detail and these 10-year plans, all fit into the model and are balanced um across the life of the model. So we would never give you a budget that fails in in the current year or within the next five and um if it is even declining and showing negative results in the later half of the financial models uh we always have a way to to um get out of that. So um we always provide you that balanced budget. So, um, one takeaway from that is that when you're listening to the departments talk about kind of their operations, their makeup, their history, all that stuff, you don't have to worry about, um, can the thing that they're describing be afforded this year. Um, you know, going into that meeting that everything that you hear, uh, is in that model and can be afforded. All right, now that Brian's done with boring detail stuff, back to back to interesting vague concepts, my

specialty. Um, we also went through the one Harrisburg kind of the community survey that that we've all been been talking about and grouped out these um areas of consensus. So this is everything that you all have have agreed on that you have a consensus as a board and you have consensus with the community and so these are these are areas where we can make major progress as we move forward because we know we have strong support from all aspects on growth and development. were well aligned with the community. Measured intentional growth, preserving that small town feel, extra attention around uh density, lot size, product type, making sure we build high quality things in town. That's that's what we hear across the board. Transportation and traffic, congestion's ranked number one, right? Nobody likes the the congestion. um making continued efforts towards improving that infrastructure and traffic flow, especially walkability and connectability and connectivity in between our neighborhoods. Um parks and community spaces. Everybody loves our existing facilities. We also have a desire to have more conservation, more green space, more land banking, and then a very strong desire for those amenities around town as we grow. We're just overrunning those. So you see um a strong desire from the community and from the board to say let's let's make sure that we're maintaining those and expanding our amenities. And then when it comes to Town Center, there's a strong consensus there across the board as well. We want a vibrant, walkable town center, more things to do in Town Center, retail especially, dining especially, and a diversification of the tax base, not just having more and more of the same um tax base that is residential, which is currently 80% of what we have.

These are the same charts that that we've seen that tell that story. People are very pleased with where we're at. great place to raise children, great place to live. Overall, feel very very safe overall quality of life in in the 99%. Um, these are amazing numbers. We're going to continue to to try to hold these and we're going to be able to do that by making sure that on all of these areas that we have consensus that we make strong progress on those. We can't really waste effort on areas that we don't have that strong consensus. when we ask our residents what are the the items um of importance when it when it comes to the future of Harrisburg. Well, these are things that we have strong consensus on as well. Community safety and appearance being number one that you guys have heard me say that many many times. I've heard you guys say it back like safety is the number one priority, number two and number three priority. It's why we spend half of every dollar that we bring into the town on public safety so that we can have the foundation to do the rest. Safety and and appearance though is interesting, right? The appearance of the town is extremely important to our residents. The quality of what comes in, be it business, be it parks, be it residential, appearance is up there at number one. And then growth and and utilities I think are are handinand there as as items that people don't want to see the feel the negative effects of the population growth. That's very hard in an area like the Charlotte metro that's expanding the way it is. We do a better job than most at this. But we have to continually be be um changing our course and making sure that as we you know solve one problem, whatever other problems pop up that that we're ready to solve those as they come along. What do our residents think

uh should receive the most emphasis from you guys over the next 5 years? So rather than just thinking the next 12 months, over the next five years, I think these fell into that to that same category, right? population growth. That's number one. That's what people really are saying, "Hey, we need you to to really spend a lot of time focusing on this community safety and appearance. We're we're happy with where we've been. We want it to be important and we want it to be important long term." And then I I really think the next couple kind of all are grouped together into this access to quality goods and services, economic development. Um th those two really go hand in hand as well as the environmental health, the greenway and trails. So no big surprises here and it really fits with what our representatives that have been elected to this room are telling us as well. The conservation growth items that'll have the most impact on households, what do people think is is going to impact them the most? New development and us addressing infrastructure. I think when our residents answer that or the the surveyors um surveys that answered this, the infrastructure they're talking about is transportation infrastructure, right? They they're not really worried about whether the water lines and sewer lines are going to explode. They're saying, "Hey, new development, make sure we got schools. Make sure we got roads." We don't control the schools, but we do control the roads to a point. Most of the roads are DOT roads, but we try to hold folks as accountable as possible on that. I think what we're hearing is continued that u preserving open space being number two on this and then that distinct character and sense of place coming in there at number three as well as kind of everything above the the 21% economic development stakeholder

collaboration on development decisions. Uh a vibrant downtown um making sure new developments are walkable and and efficiently designed. These are all kind of grouped together handinand to those econ economic development, transportation and quality of life things that we've already decided hey the these are the the items that we will focus on. And then this one it it was very interesting. So the employment types that our residents um would most support the town offering incentives to bring to the community. So typically this is the type of question that you get out to the to the community when you're asking about do we want to be a great place to work? Do we want to be an employment center? And just the way our our residents answered this tells us everything that we need to know about whether we want to be an employment center. They didn't pick jobs that they wanted to work. They picked jobs that they knew would be needed for the services that they wanted. um which wasn't what the question was, but clearly Harrisburg residents didn't want, you know, a bunch of casual dining, fine dining jobs to go work. Um our median household income is is north of 150,000 a year. Most people aren't quitting those jobs to go wait tables, but we have been told, hey, we want more more places to dine. We want more places to shop. Retail, right? retail shopping coming in at number number three. Most of our residents, I don't think, are are dying to work at farmers markets or produce stands, but that came in, you know, right at the top as well, right? They want to experience these things. So, when you really look at everything from 22% up, these are the things that we just know intuitively people have asked us to look at bringing in from an economic development standpoint. coffee

shops, movie theaters, outdoor wreck areas, retail shopping, dining, fresh produce. Um, so what we take away from this, and I we talked about this some at our retreat, is that our residents are saying, "We're happy not being an employment center. We like being a really good place to live. It's not that important to us to be a really great place to work." That was very low on on the scoring, but we do want to create jobs that make the community a great place to live. And and so this was an interesting takeaway from that. I'm going to kick it to Lee now. Back to Lee. Get

I think I got you ahead of schedule. So you Yeah, we're we're we're doing well. Were there any questions on the the survey results in some of our um do do we think there's any divergence from what we've talked about at the retreat or we talked about here? Um, some of this seems just, yeah, obvious because we've measured it so many times. Um, but if there isn't anything obvious, if we feel like, hey, we're missing something here, um, you know, let us know. But I I think our community speaking loud and clear. I think we're doing the comp plan at the same time in our board. Um, we don't have a lot of shrinking violets on this board, so you guys tend to tell me what you what you think and and it matches up with what our residents. I have a question come out. So we talked about on one of your slides you said one of the focuses is going to be on county center. I think you said right?

Yeah. And um and that at the retreat. What about a lot of of questions about Farmington? How does Farmington and economic development fit into this plan in terms of the budget? Farmington's a pre-planned development. So, that's a relatively newer development that's had some uh modifications to it and only stalled due to co.

It doesn't really it's not it doesn't have like a 25 year stall. Um, we anticipate Farmington, we've already seen Farmington generate, um, I think we're at $700,000 a year in taxes that we bring in from Farmington now without it being built out, just the residential side versus what it was at at at the start. Um, that's going to pay for the road improvements until they're paid off. Uh but after a few I think we have about $6 million into that that uh Farmington project as a whole to pay back on the road improvements. Once those are paid back, that money now comes to our general fund. So we know we're going to get several million dollars a year from Farmington as it builds out fully and the the plans out there for what goes where and when are pretty well developed. So, we're we're happy with Farmington. Now, as we push a little bit east of Rocky River now, there's some, you know, there's some parcels there. We've we've got um Venture Church's large parcel there. Cochran owns a piece between Venture Church and Brookdale across the street. The Cochran family owns another large parcel there. The hospital obviously is is looking to add 95 new beds in a in a full hospital there. that's going to dramatically change around Farmington, but in Farmington, um, we're pretty we're pretty pleased with what we have out there. I hope that answered it.

Is that good? Part of Farmington also is so when Rob said it, CO paused it, but it's not what it initially the concept was because CO changed the way America looked at a lot of things. movie theaters, right? So, I mean, do we have an update on Target at all? So, Tenant X is continuing to uh to go out there. It's it's the worst kept secret in town, right?

Um and and my understanding is I mean, they're they're as far along as a lot of their other things that they've announced publicly, right? They they've got plans into our planning department to uh modify what they would need to do on the road frontages. Obviously that that particular parcel was just over the line. Um but all of the other parcels around it the value of those or the I guess the tenant value of those parcels goes up quite a bit as you get a large traffic generator or foot traffic generator like a like a target out there. Well, and tenant X, you could say it. I was just I was being koi. I'm sorry. Um Shel says tenant X to me all the time and I'm like

yeah softy they're having financial issues. That was probably the other directive that I was wanting to understand is that still go forward because in many ways they're looking at we've heard we've heard nothing but full steam ahead on on that project. Is their new concept though of a smaller footprint? It it'd be it would be a much different it wouldn't look like anything um you had seen before and it would not look out of place in Harrisburg even though it wouldn't be in Harrisburg. So it would be a much much different elevations or we're or particular

you know one of the things you done I don't know how I write they seem over you know compared to their population we seem under retail and oil changes is there a goldilocks like hey we really are under retail and we're missing tax or would that offset and allow us to lower I mean if we had all these places here would that allow us to to you know keep the tax under control for the residents since we're not getting I I don't know what that balance

yeah so that's the I mean the overall goal is exactly what you said as we diversify the tax base be it retail or other commercial or industrial that helps us keep our tax rate where it's at which is already 13 cents under our peer average, right? So, I mean, we're we're 30% below than than our peer average. We want to stay down there. We don't we don't want to have to creep up because we have all these services that we provide and we can only do it on on the backs of uh residential properties. So, we do have retail leakage. We we do feel like there's retail that that we can snag and keep here. Um how much of that that's up for debate depending on the location. We know we've missed opportunity in Town Center. That's not been market based opportunity missed. That's been an anomaly. Um we have other areas where, you know, we could kick the door open on on certain product types, retail or multifamily housing. The market would flood our area. But it, you know, we're talking fast foods and and you know, like you said, vape shops and stuff that like you'll you can sell a lot of things along 49 in Rocky River, but we're pretty particular on our zoning on how far we we spread things apart. We also have limited sewer capacity. So, we're very choosy on saying, "Okay, if we're oversaturated on a certain um you know, product, we can't afford to put all of our eggs in that basket. We need to to spread this out." So, I think we have by design held back a little bit on that, making sure we're getting the right things at the right place at the right time. And so far so good. I I think adding our economic development team was not a second too late. They've been killing it. I think the Morehead West area is is an excellent um proof and concept of that as we've done our um our site analysis

and Ryan's got great connections with all of the the partners that that are working out there. I think uh we've almost u brought that broker in as a uh an employee of ours. We're working we're working them so much. So, um, we've got great opportunities out there and that will help us continue to to keep our taxes low and potentially drive those down. The stat you said 80% of our taxes are being paid by, you know, is that best practice? Our whole voyage should be No, we we'd like to drive that down. My my goal is to get that down to a minimum of 70%. Okay.

Um, but we we'd like to drive that down to zero if we can, right? That's the Goldilocks that we're talking about. You hear that residence? We we'd like to get that. Um but in in reality, we we want a strong industrial and commercial tax base to to supplement that really nice residential base that we have. We have a great residential tax base and and our residents get good service from us, but they also give good support to us. So, you know, we we get good resources and we do good things with those and and that's a a good bargain that we have with each other. But as times get tough, maybe in a in a 2008 2009 scenario, that's a lot. You know, 80% of your um tax base being dependent on residential is just it's very hard. So, um that's the point of driving that down, but we'd like to you we'd like to get that to to 70% or lower. We have some interesting slides later on some of those percentages and how we've kind of grown commercial and industrial, but also we've we've done a great job of building a great community. So, the value of each home is also going to increase as we kind of build that that gap in between an average community and us.

All right. Lee, you did have two minutes. Now you're in the whole five.

Hey, so I'm going to talk for a few minutes about continuous improvement and how we're using that as a way to increase our efficiencies and really push us towards operational excellence. Continuous improvement sounds intuitive, but I wanted to make sure that everybody kind of got a good feel like this is an area a a philosophy actually that we're trying to put in place for all of our employees uh to look at everything that they do and is there a way to make it better? And this is this graphic here shows a little bit of that where you know imagine it this is a parks uh event because we're picking on parks today. Uh but it could be any process and we we see how that process performs. We evaluate it. We look to see if there's ways that we can improve it. We put those improvements in place. We see what happens. Then we evaluate it. look to see if they we can improve it and put those changes in place. So, um it is really a a full-on philosophical approach that we're integrating in everything that we do. Um some of you may remember last year that we presented as well as during the the budget workshop in fiscal 26 for the that budget process. We asked all the department heads to look at their department operations and come up with innovations, initiatives, and efficiencies that they felt would be able to improve their department itself. I won't go through this full list, but the this is a list from last year and and some of the the ones that we did have some progress and success with our pavement management program, the fleet assessment program, uh the change of

event venues to try to have some more of our uh parks events here in town center. that was wellreceived and you know that goes down the list but uh that was important last year for us to begin stepping into this idea of constant improvement. This year we decided that we wanted to take it that next step further and actually measure u the outcomes from those process improvements. So, we did the same process as all the department heads for fiscal 27 that we're in right now uh to give us their list of process improvements and innovations. And I again I won't go through this whole list. We've actually have two pages here worth uh every department here, but I did want to kind of highlight some of the examples of what we're looking at. things like employee on-site clinic, brand refresh, uh enhanced services, bringing some existing uh outside work inhouse so we don't have to rely so much on consultants and have more uh ability to attack some of the stuff. So you'll see those go through again, you know, in in parks looking at additional youth athletics, looking at additional uh non-athletic events. So, uh, really trying to get this idea of how can we make what we're doing as best as we possibly can and how do we do that is really taking and using data and benchmarking as a way of looking at what those outcomes are doing. Uh, you data and benchmarking really helps to have uh more transparency. It helps us to direct our strategic planning. uh it really gives us a way to uh collect the actual data. We

understand that that's not going to happen overnight. Um there's years that we have to build up consistent data to be able to look at trends, but we're starting the process and we understand that as we continue to go through that process, we'll refine it. Um again, cons constant process improvement and it'll really help us make uh really good informed decisions. The the last one you see here is uh you if we don't measure, we don't know what we're accomplishing. If we're accomplishing our goals, that's really important. And so this here really tries to we put it into three different buckets. Council, why is benchmarking important to council? Well, it helps to drive your strategic focus and it helps to inform your policy decisions and it also demonstrates transparency not only from us to you but also from us to the resident so they understand what we have going on. From an organizational standpoint, benchmarking improves operational efficiency, enables continuous improvement, and it also supports accreditation and compliance. At the departmental level, it helps identify gaps in service, justifies budget needs, and it enhances our the service delivery. So, measuring what matters. One of the things that I always say is that collecting data for data's sake is an effort and uh you're not going to get good return on that because it's important that you collect the right data and you understand what you're trying to get out of that data. So we look at some of this here you know strategic alignment you that really helps us track progress on council adopted goals and initiatives. We share that with you, the results of those every year at the council retreat, as

well as we're now building those into our quarterly reports. So, not only you, but the public can see how we're progressing on those efficiency and productivity. You know, it measures output relative to the resources used. An example of that would be staffing and resource allocation or capacities. uh service levels look to track quantity and quality of services delivered. Some examples there service volume, response time, backlog or case load metrics. These are really key metrics and again these this is just a fraction of them but these really go to help us identify how those outcomes are are being measured. The one that probably everybody is most used to is our financial uh those are used to assess the fiscal health deficiency and resource sustainability uh cost per unit of service, budget variance and the million other ones that we present to you every year that describe u more of an afterthought of how did these uh different programs perform and how can we use that data to make them better. So the last one here is outcomes and I think that's really important. Uh the question here is is anyone better off? It really doesn't matter all of the top four. You can get uh the data, you can go through all the right analysis of the data, but is it making anybody better off? Is it going to our mission, vision, values, and goals? Is it going to support those? If it's not, then we need to evaluate whether or not we continue to proceed with that. Uh it may be that we can use those resources, remove them from that area and focus them on an area that does support the mission, vision, values, and goals. We try to head that off on the front end because everything that we do really is geared toward

meeting those objectives. But uh it's important as we go through to evaluate the data that we're looking good data is really beneficial data. If it's not, then we're wasting time. Want to show a couple of our recent initiatives. I've just mentioned the quarterly report here. You can see uh we've gotten two under our belt so far. They seem to be really well received. This is just the beginning is transparency for us really to let everybody know how we're doing as a town. again taking uh those goals that you have provided to us that support our mission and vision and our values and making sure that the public knows that we are working through those. We are following your direction and doing the best we can to make Harrisburg as as good as we can. The benchmarking 2.0 0 here that's more of an internal uh tool for us to use where it's part of uh UNCC project that uh allows us to benchmark to our peers in a lot of different areas public works engineering u parks all those and that has again been one of those where it's taken a lot of education for us to get up and running. This is new to a lot of people uh but we see it already beginning to pay dividends on that. This here just wanted to point out on the quarterly reports. This is uh includes all of this which has our initiatives and you know process improvements in there uh for every department on the list. So you can see every department and how they're doing. And this is just it's a lot. Don't not getting into any of it. Just enough to say there's a lot of metrics that we have going on. As we're moving forward, we're evaluating those again to make sure that those are the proper metrics for us to be evaluating and passing on. And we'll continue to do that as we move

forward. Um Lee, can I just pause and let everybody know that's online and in the audience that you can access all of this online. If you just go to the town website and type quarterly reports in the search engine, you can pull up the two and there's lots of good information there. Yep. So, any other questions on that? I'm happy to answer them. Otherwise, I will turn it over to Brian for headwinds and opportunities.

All right. Okay. So, so we kind of want to get into our revenues and expenditures to uh set the table a little bit for the departments and what you'll hear uh at our at our second workshop. Um but you know, the town has about $50 to $60 million in external revenue that we collect on an annual basis. And um in in your budget report, you'll see all the different sources of that revenue and the changes from year to year. And we've got workbooks that back up the detail behind that and the forecasting for it. Um, but if you really just zoom out and look at the town revenue from from a really high level, all of that revenue fits into essentially these six buckets right here. Um, so we can kind of simplify our revenue by zooming out a little bit, classifying it into these categories and looking at what influence uh do we have over these revenue sources. So almost half of our revenue, 45% comes from our property taxes. Let's jump into property taxes here.

We know that natural

Brian was really proud of that transition. He's got a few more for you. So don't Oh gosh,

this is just PowerPoint. Just think if we got into video creation. So um the the first area to look at with property taxes and the one that we have um a good bit of influence over is our natural growth. Uh so you can see from 21 to 25 that we were north of 4%. And for many years before 2021 and for this 4-year period in our financial model we planned for 4% growth give or take and we kind of just enjoyed that extra amount that would come in. if it would come in at four and a half or 5% we would see that by the end of the year and you know that would be a benefit for the town but we knew that a 4% was about our floor for our natural growth. Um what we're seeing now is that in 26 we did have our first uh bonafide year under 4% at about 3.6 or 7 and the number that we just got from the county right after our um council retreat was 3.9 for fiscal year 2027. So that is that is better than what we are anticipating. We were a little uh concerned that we might be in the three to 3.2 range for the current year. Um so I was I was really happy to see the 3.9. But what you can definitely see just in this chart is that we need to kind of reset our expectations from that base of 4% and probably settle in somewhere in the 3% range. But then we know that our focus area is economic development and that's what's going to make up that's what's going to get us from three to north of four again. Uh it's harder and harder every year that you grow to grow at the same rate. Um and and to put that all on residential growth is really tough as well. We used to count on 250 homes a year. We knew that that would give us about that 4% growth. Um, now we we're seeing about 120 or 130 homes and we're still getting 3% growth. So that

speaks to what Rob was talking about earlier, the value and the quality of the homes that we're bringing on are much greater than they were in the past. But then also something is filling that gap a little bit. And so if you think about what development we've had uh in the past year or two, we've had quite a few restaurants and businesses open up on 49. We've had the activity in Farmington. uh we've had a little bit of a buildout of of commercial um that exceeds what we've seen in the in the past decade or so and and so you can see that playing out a little bit here, but but we have looked at the model and and said that we probably need to pull back from that 4% unless we really make strides into the the commercial um atmosphere. So, um, my last note here, sorry, is that the the negative revaluation for fiscal year 2029 is a very real, um, situation that we'll be in. And so, we need to plan for that as well. And this is what tells us that we're we're probably headed towards that at least a flat revaluation, if not negative. Um, this chart here shows about a decade of median sale prices in the United States. And so we were very flat from 2016 through 2020. Um hardly any growth at all. The average home price was right, you know, hovering right around 320,000. In 21 and 22, it spiked up to 440,000. And you can see I've shaded here where our rebal was done for Cabaris County. It almost couldn't have been done in a worse point for for the county. um and and they know that and that's the point of the reval is is to um reattach yourself to the market every four years and not get too separated from where the real market is. It just uh was not the best timing for us this time. But what you can see already in about a year and a half after that rebound period is we

have fallen off about 3 to 5% in home sale prices. Uh you probably have seen that just uh looking around Zillow and and everything else is is that homes are staying online a little bit longer. They're they're uh having to do a price cut before they sell. So we're seeing that 3 to 5% come off those prices. Our next rebal will be performed in the 27 28 calendar year. And so um that's not too far away. And so if you think about where values are right now, that's where we think three to five, maybe even 7% is uh is realistic for a reval. So um so we'll keep that in mind as we plan over the next several years. Um but it is something that that we're going to be um faced with in the next couple years.

Brian, does does a recession tend to follow a negative reevaluation or no? Um I would say um a negative revaluation is reactive to that recession. Yeah.

I I I I would say like this data that we're looking at, right? So um all of the the macroeconomic things that you know we've talked about already but that we look at internally point towards a significant downturn. So we knew this when we looked at at our rebound period last year that you know it's only done every every four years. So the time it was done before co prices were flat. It didn't catch any of the inflation of 20 21 22 23. We had to deal with that. We didn't raise taxes during that that time. We just kind of ate that inflation. And then we also knew okay from 24 5 6 7 we think and we I think we build it in there four or 5% over that period as an average. So we've seen that you know kind of peak up and then trail down. Now we're down a little bit under 3%. Um but we looked at that 8-year period when when we did our our reval thinking it it would be flat. Um, now we're looking at at those numbers and going, "Okay, might be a little worse than flat." Um, job numbers and we we've got we've got things on on that later. Um, the employment cost index, we follow that quarterly and we look at that internally, quarterly. That's fallen off a cliff the last two years. The the employment cost index is half of what it was two years ago. Um again the the number of open jobs out there are half what it was two years ago. Housing prices are decreasing for the first time in seven years. And so all of these things are kind of adding to, you know, that nervousness that that I've had over the last year of what is the the black swan event that kind of pushes everything to a reset? Is it an AI bubble? Is it an everything bubble? Is

it, you know, consumer credit card debt? Is it a historical high or delinquencies, sorry, or the highest they've been since

07? Yeah. So, this month they hit the highest since ' 07. So, all of these things in isolation are one-offs. But when you look at the big picture of it, it doesn't look good. It's It's not a pretty picture. We're well positioned for it. I don't want to make that like a Harrisburg scary thing, but it's something we keep an eye on. It's how we stay ahead on things like this and it's why we have good finances and why we make sure we don't get ahead of our skis is there are opportunities in good markets and there's opportunities in bad markets and so we'll we'll talk about that part of it as well. But we're predicting a recession internally. Who are we? We're just town managers. But you know I

I just know that you know markets like Florida is falling pretty fast and um some parts of Nevada and a few others. So yeah, they're they're probably feeling like they're in the the heat of a recession right now, but that's because they grew so much. They they even outpace North Carolina in a big way. Uh so hopefully we don't have that sort of correction like Florida does. But um but I think we're going to experience it along with the rest of the nation.

But this is this has been our conversation when we did the the revile the first time was we we don't look at these things in a vacuum. We're not looking at one year at a time. We're looking at 10 years at a time and trying to to adjust for that. So, you know, yes, housing prices will go down, but also everybody wants them to go down. Every every time I talk to a state legislator, every time I open the newspaper, every time a developer walks in here, every time I talk to a housing's too expensive. Market corrects for those those types of things. We hope it's not catastrophic to the economy. We hope that housing kind of just slowly modulates and we can kind of grow into it. Hopefully wages continue to go up and housing kind of flattens out. That would be the ideal situation. But this is why I get very um skeptical on overreactions, right? We have we had one big revaluation um that looks bad in a in a vacuum, but the other the one before it didn't account. It was basically a -12 because it was a flat reevaluation that didn't take into account all of the COVID inflation. And now when we look forward, well, that's going to be negative. We're going to take that five or 7% off the last revaluation because the cost of things haven't really gone down. So cost has gone up, our revenue is going to go down. We've built that into our planning, but it it really is kind of a a bigger picture. And I I would point that out to the state legislature and to others that kind of want to have a knee-jerk reaction to property taxes or housing valuations or you know how these things go. It can go down just as sharply as it can go up. And I think the more often that you do a reval the better. If it were up to me do it every year. That way everybody's getting incremental ups and downs you know with

the economy. That's a lot of work. So that I understand why they don't do it, but um this one was just timed very poorly. As Brian said in the beginning, it just it hit at the peak and so people really felt it along with all the other clothing, food, gas, utilities, you name it. Um and it just caused a fervor. I think we're going to see the opposite of that over the next few years. Well, that takes us on to one of Rob's new favorite charts, and it's a pretty simple one, but he likes the detail in here. Um, but it's that discussion about our property tax base and how important it is to diversify that to commercial and industrial. Um, so we had been in that 75 25% range for a number of years and the reval is applied to residential and commercial properties. Uh but you can see all of the gain went to the residential side and shot that u proportion of our valuation up to 80%. Um so knowing what came online and um how valuable commercial property is, it just shows you that the true value of all those homes that came on in in that last um during that last four years and how much value they gained compared to the value that uh the county assessed on commercial property. Um, but this is is a huge focus of ours. It's something that we pay pay attention to and making sure that we can drive that property tax base uh number down for residential for exactly what Councilman Ball was saying. Um, you know, there is a much sweeter spot than 75 or 80% because that is the proportion of the the tax burden that goes on to the resident. Yes, ma'am.

So, I just want to make sure I understand. So, we're talking about the property tax base. So, so the rebound we have no control over, right? So, to account for any changes that come, positive or negative, we're going to focus on the commercial because that cuz the reval the commercial is affected by the reval. Right. It is. And we will get some of that payoff of and and the taxes from those. Is that correct?

That's correct. Um my my point was that the commercial commercial doesn't move nearly as much when it comes to the rebound. It's much more stable. um residential swings up and down with the market and so if we can pull more of our concentration down to commercial we will not see the uh the swings in our valuation like we did. So so so so this discussion and and the and the and the focus on economic development part of that is if we have more of that that's those are the factors that we can control. Absolutely.

Okay. So that's so again this goes back to what in the beginning of the conversation and what we said as a council by the retreat. The focus on this economic development will help to kind of um secure us and put us in a good place if if things go another way but they rebound. Absolutely. I'm just trying to

Our goal would be to prioritize these these bottom two numbers. This is a very simple graph, but it tells you so much, which is why Brian keeps saying it's my favorite because I I I've picked you I've held these guys hostage for hours picking apart these three lines because there's there's just a lot, right? We we know that the the residential um reval went up north of 40%, 40 45%. Well, we didn't see that big of a jump here, right? It went up 5%. So, what is that telling us? Well, even though commercial and industrial either stayed flat or went down and and here it kind of took off the commercial, it tells us one that those numbers have stayed flat because they don't change hands as often. You don't sell commercial

as often as you do residential, but also we've had to have a pretty significant uptick in those to pull that extra

3540% of value that should have shown up in this blue chart. that number should have went up to 95%. If we just put a reeval across the board and the bottoms were flat, that that number would have would have, you know, blown away the bottom too. So, we are making although this kind of shows flat, we're making good progress in the industrial commercial area as a per unit, but as that revile went up, it kind of offset those and and it skewed it. Now, as we move forward, I expect that 80% even even if we didn't do as good on commercial and industrial, I'd expect it to come down a little bit because the value of that 80% is going to shrink and we're going to expect the value of that commercial and industrial not to shrink

and and restabilize. So, yes, this is probably my new favorite graph because it's simple, but it tells a lot of stories all at once and it sets a simple, measurable goal for us. Let's get that residential down to 70%. Get the rest up to 30%. That does two things. Once one, it it diversifies that base and makes it more controllable like you said. Um but we also don't provide nearly the number of services to commercial and residential properties. We we they don't they don't have, you know, the the same trash pickup and the same brush pickup and, you know, all the other things that that a lot of our residential properties do. There are other services that we provide to them, but they tend to be winners on the economic development side or on the not on the e on the community service side of things, easier to serve.

And as we as we track this for the next couple years, we want to purposefully earn our way down to 70 or 75%. We do not want to see that as a result of the next rebound. Right? So that's really key. If that happens, we've we've had a bad couple years. So, we want to earn that ourselves and then let the rebal just kind of carry that number forward, whatever it was. Thank you.

Um, so the next one that we'll go into is the sales and franchise taxes, which makes up about a fifth of the town's revenue. So, I will not go into the very specific uh numbers here, and we talked about this at the retreat, too, but we have two inputs into this uh revenue that is distributed from this from the state. It's the economic activity across the state and across Cabaris County. Um, so that that's very important that that your dollars are spent in Cabaris County so that they make their way back to the town and then our proportional share within the county and that that goes back to our levy against the other communities levies. So we need to outpace in terms of growth in terms of valuation. We need to outpace the other communities in this county in order to soak up more of that sales tax distribution. So you can see whether it's been from our growth from a tax increase in 24 or out revaling the rest of the comm rest of the county in 26, we've always outpaced the rest of the county in this chart that you can see here for the 7-year period. So that's a a real good positive for us. Um, but that's, you know, another community could bring on a couple more liies and that valuation just just blows away anything that that we can grow next year. And so we could see a decrease from another community taking action on their own. So, it's important for us to keep up and and to continue to grow. Um, and we just get to choose where that where that growth is. is a commercial, industrial, residential, and um how can we try to continue to outpace the rest of the county or at least stay on pace the economic activity? Um you know, we don't have any control over that at all. But something interesting that we saw here is that we know we had the highest inflation period of most anyone's life from 2020 through 2023, 2024. And you see that in the sales tax numbers here. I don't think this was um volume of items bought. I

think it was the cost of the same items that were bought in 2020 that you're seeing show up in these higher numbers here. And then we from 2024 through 2027, we either have actual uh economic activity growth of one or less than one or estimated of zero for 2027. Uh and then in 2025, we did see that 5% number there and um we we're kind of discussing what what would have led to that. That seems like an outlier if you look at these four years. And I don't have the chart here to show you, but we just mentioned it. And and I truly think that this comes back to uh consumer debt. You know, consumer debt is higher than it's ever been. Delinquencies are higher than they've ever been. And so I think 2025 was the year that everyone continued to take care of their groceries and their car repairs and and all of their their household expenses, but it wasn't coming out of wages. It was going on the credit card. And we're seeing those default now. Um I can't remember the rate. I want to say it's 22 or 24% or something.

It was north of 20

of the is the default rate right now of balances over 90 days in America. So it that's another problem that is certainly a headwind that we'll deal with but the nation will deal with as well. And that's the type of thing that can lead to uh impacts in the housing market and in other markets that you wouldn't expect uh to have an impact when we're looking at our revenue projections. So that's what we think led to 2025's 5% there. Um and now you know if that was the case um then we'll we'll pay for that over the next couple years as we have zero or negative growth in terms of economic activity and as people work theirselves out of that u consumer debt mountain that they're under. Uh the next is about a quarter of our revenue is for our utilities. So water and sewer and storm water. Um so not too too much to discuss here but um it is time to take a look at water and sewer rates. So at the top of the screen here you have the water and sewer rates and the percentage change from the prior year. Um in 2018 we adopted an every other year rate resolution to try to give people um some understanding of the rates that would be heading their way in the future, help them budget. when we got into that inflation period um in 2022, we noticed that every other year is not going to cut it when we're when we're experiencing 30 and 40% inflation. And so we converted that to an every year resolution and we held that for four years. Uh but last year we were able to um avoid that increase for for one year and so that was really nice to be able to provide that in 26. looking at 27 um probably not going to be able to avoid the rate increase if um if things go how they are right now. You know, we still have the increases on the water purchase and the sewer treatment coming from our partners there. We still have our labor cost that are going up and our materials cost that are going

up. And so to absorb that for more than one year without some sort of rate increase is really tough. So we hope we hope we don't have to go all the way to the extent of 5%. Um but it it's another realistic possibility. Brian Wasac, grab that for me. All right, I say was that's who's has the water rates to us. Correct. The water rates are city of Concord. City of Concord. And those that flows all the way from Alamaro. So we're the third user in line on the water and then our sewer treatment is with Bossac. But the water rates from Concord that's on a steady increase every year though. Correct.

Both of them are. Yeah, both are. They both are. Yeah. So we we pay we pay was for sewer, we buy water from city of Concord. Those stay in the three 3 to 5% increase from them. We generally um pass that along in the way of the 5% every year. Like Brian said, years ago before we were looking at the different increases, it was every other year. Some point we switched to kind of every year. Um, in 26 we were trying to to make a point, hey, we want to give as much rate relief as possible. So, we squeezed a zero in in 2026. We do plan to continue on that 5% every year moving forward because everybody else I mean, we don't we don't have a way to make water cheaper. We we get whatever Concord sends along to us.

It's the same thing as a merchant fee, right? you know, the consumer is being charged the credit card fee as opposed to the businesses taking it on. It's no longer affordable. So, it has to be passed back to the Yeah. resident. So, no, I get it.

Um, and the, you know, the other portion of this is the last line you see there, which is, um, on the WASA, the sewer portion of this, you know, what is the impact um, of expanding the the treatment capacity? What's that going to have on rates over the short term as we move into economic development? One of the choke points that we have for economic development is that we don't have sewer capacity, right? So, we could get a really good industrial user that's going to come in and say, "Hey, they're going to pay millions of dollars a year in taxes and they're going to buy the sewer." So, I mean, they're going to pay for it um monthly. They might pay two $3 million a year in in sewer fees. um but we don't have it to give to them because we haven't built the capacity. So we are going through this at WASAC right now. How much capacity do we need in the entire county and how much does each city want as their proportional share when we look at you know what our room is there again benchmarking right? So on the residential water and sewer side of things we look at those same communities and that's what we're really concerned about is the cost to our residents. What does it cost every month on the average water and sewer? So for 5,000 gallons in Harrisburg, that number is $78. The group average is 90. We do have some room between us and the group average. Um not sure what's going on in Leland. Maybe they had some some major debt issuance as well, but overall we're better served by having these industrial and commercial properties in town paying water and sewer fees. Once you're in the system and you're paying it, it helps stabilize those rates just like it helps stabilize the taxes because you see our commercial water and sewer services are above that

group average. And so it helps keep the residential rates down. But there is going to have to be a debt component of some sort as we run out of capacity. We need to purchase the capacity, buy the capacity, build the capacity, and then bring stuff online that can then lower the rate. So, we do see this, you know, 5% is probably building up some of that. But we need to do a more in-depth analysis through this budget process before the end of the year to say how much of of a rider are we going to have in the short term because we don't want it all to hit at once, right? You don't want to say, "Yeah, we'll buy we we want to expand our plant another million gallons for industrial users so that we can stabilize or lower the tax base." Um, but we're all we're going to wait until 5 years from now and then worry about it then. We would like to kind of build up that that rate, make sure we don't get over the median rate, but we know we have, you know, a little bit of room there. Right now,

we used to offset some of our water through Charlotte. Is there any savings with that or do we even have that capacity anymore? I know I know the switch is up by a Harris ter. We we have the capacity. It's about the same. Um Concord's doesn't have bad water rates. I don't want to point, you know, point the finger at them like, hey, they're they're passing 4% to us. They're pretty affordable. Charlotte's pretty affordable. We do a really good job. Um I mean, we're not far off of, you know, these other big cities rates and we're buying it from them. And then we have to do things here to treat it and put our own pipes in the ground and get it to your house, build water towers. So,

no, the the where I was going with that is the the average consumer is going to tell you you're nickel and diamond me to death, right? You catch me here, you catch me there. It adds up after a while. So, my I'm just curious, does is there any offset by going through Charlotte? Does it help us in any way? Are we still facing that same beast? yet it helps us with capacity. Charlotte water is a little more expensive than Concord. Um so it doesn't help us really lower the price to to go Charlotte water. We do take some from Charlotte and some from Concord. Um and they've gotten a lot closer. There used to be a bigger gap in and Charlotte because they're a bigger entity has been able to stabilize. Cabaris County is in a different watershed. So we have a little bit more scarce resource. So our cap that what we can buy out of Concord has narrowed and Concord has brought on a lot of industrial users over the years. You know, we would have certainly have loved to have an uh le Eli Liy or a Red Bull and and get that tax base and sell them that sewer that comes from our same sewer plant, right? We have one sewer plant in the county. And so long story short, I think we our goal is to have reasonable singledigit increases annually and not say, "Oh, we're going to we're going to push this off until we need 12 15%." And then we'll put it off, put it off, put it off and 12, 15%. I think our consumers, it's easier to plan annually if you've got these 3 to 5% utility increases. You're seeing more of that, more than that at Duke. You're seeing more than that at the gas companies. Um, we're doing a pretty good job here at at water and sewer, but we're going to have to figure out a debt component on how much we want to make available for economic development with the with the goal being

the long-term horizon, the 20-year horizon, of how do we stabilize and drive rates down, both tax and utility rates by adding commercial and industrial users. Thank you. Zoom B. Am I staying or is it back to I got a couple more?

Okay, I I'll speed these up here. So, another category of revenue that we have that's really crucial for the town that doesn't really show up here is grants. When they do show up, they kind of push all the other categories here around. And when they're not here, they're obviously not represented at all. But here's our large five grants that we're tracking right now. So, the ARPA grant is coming to a close this year. Um, and then we've got our four transportation grants and you can see there what we've received to date. So, about 22 million in federal grants. Um, and so I I think all the the people that have applied for grants and I think Councilman Smith at the NO can tell you that we've exhausted our regional grant opportunities. We have soaked up everything that the county has that DOT will consider that that any of our partners have to offer right now. Um, and but that doesn't mean that that we're not done. This is a a really crucial uh revenue stream for us. And so we've turned our attention straight to state appropriations. If we can't get a grant for it, uh, can we get it in the state budget? So, we're already pursuing uh getting the train station to have a state appropriation. And if that doesn't work, we're looking at federal infrastructure packages as well as those uh potentially come online. We have a public safety complex in the future that we'd love state appropriation for um or or a grant for. Um we're always pursuing our major traffic improvements under grants or getting those shovel ready so that when infrastructure packages come about uh we're ready for them. And then we have a $30 to $50 million parks master plan. Are there part F grants when we when we're buying land? Are there other smaller grant opportunities for equipment and other other facets in that park that we can pay for? So, we are always uh trying to do those big impactful grants, but I also don't want to um not mention the small grants that we get. Um you know, we had Inbridge, we've had a Duke Energy grant, we have safety grants. Um I hope I'm not

stealing anybody's news here, but the youth council got a grant um just about a week or two ago for their pollinator garden that that you all just approved as their annual project. So, everybody is is going out there and trying to get grant funds wherever we can and and um put the local tax dollars to work the best that we can. And there's no better way than um taking your local dollar and multiplying it by five with federal dollars or or other people's dollars and turning that into a project. So, this is this is really important for us and is is a focus area for every department. and Brian on that for just one moment. I I will tell you from one that's been here for quite some time. Grants were never pursued for the longest time. And and I hated that because it was always looked at like it was too cumbersome. We would never qualify. We're not of the right income. Blah blah blah. And then suddenly, you know, we've started making headway and goodness gracious, we're saving a lot by doing it. So, absolutely. I, you know, I appreciate the staff for digging in and figuring out what it was that we needed to do to start qualifying for these things.

Absolutely. Ryan, why don't you skip to personnel and healthcare? So, there's like one more slide just to get us back. We're about 25 minutes left.

Okay. So, on the expense side, um, you know, we really only have four categories of expenditures and each department will get into all the detail of their expenditures. Um, but let's go into personnel costs first. So personnel make up um you know about 40% of the town's expenditures. 65% of those costs are wages. And so what we want to communicate to you now is that you're going to see um a little bit flatter actually. So this is good news. You'll see a little bit flatter uh wage uh salary budgets in in each of these departments. And it's because we um we don't do salary studies every five or seven or 10 years like a lot of communities do. We've started doing those live with everyone's uh evaluation all throughout the year. So, everyone is tied to the market, made sure they're within a reasonable range of the market every single year when they're getting their evaluation and their merit increase. And furthermore, we don't just peg that to 5% and try to have our town bell curve average be some uh random amount like four and a half or 5%. We tie it to this um Department of Labor uh wage index. And so if the average uh wage index is 3.83% then that should be the middle of our bell curve for our raises. And so that keeps everyone within a reasonable range of market every year. And so we don't have those big big salary study hits that a lot of communities deal with uh routinely. Um so you can see the the chart here for uh state and local government workers that that curve has started to bend. Like Rob said, um we were seeing four to 5% increases on wages and benefits and both of those have pulled back uh to closer to about 3%. Heading forward.

And to add to that, you know, Councilman Swift brought this up earlier, but um we try to stay operationally, it's our goal is to stay ahead of that market, right? We want to be in that top third of the market. Um that's part of how we keep our employee count low and to keep our costs low. So, you know, we attract the best employees with great benefits and great wages. Um, we want that middle to to be at 3.8, but we tend to be on the on the top end side of that being at about, you know, 4 and a half this year instead of 3.8. But as a macroeconomic indicator, you can you can see 2020 to 2022, that's when you saw it move from about 1 and a half to 5 and a half in that short period of time. We all remember how hard it was to to make sure that we can attract the right talent and keep the right talent. And since then, you've seen it go from from five and a half to this this month, the number was 2.7. So February 10th was the last print on that. And the the 12 month um wage index was 2.7 looking forward, 3.2 looking backwards. and that 2.7 looking forward is assuming it doesn't deteriorate any further. So I think our best case scenario is the 2.7 forward um employment cost index number which is half of where we were at two years ago. So something we're keeping an eye on. We again we want our folks to stay ahead of the market. That's something that we're committed to but you can't do that unless you know where the market is. We we can't just pull it out of of nowhere. We use the employment cost index as that performance-based component to our annual salary surveys as Brian said. And the next one is a little bit more alarming. So the next uh the other third of personnel expenses are either health insurance or some of the other ancillary benefits and taxes. Um and so this chart here shows you

something much more concerning. um that health insurance while it kind of jumped around a little bit compared to wages and salaries um has really taken off since 2024 and most people can probably feel that themselves. They've seen it themselves with um health care cost and insurance premiums especially in North Carolina as well. Um but that's really decoupled from where it should be at 3 to 4% and has skyrocketed. And so you'll continue to see, this is nothing new new for us over the last couple years, but you'll continue to see a potential 15 to 20% uh health insurance premium increase across all of our departments. Um that puts us in a position that we always need to make sure we're we're figuring this out the best that we can with the tools that we have. This is a national crisis. Um but we don't want to let that affect our employees and families. And so we're going through evaluating self- insurance. You know, can we can we move the risk pool around and um and change the setup a little bit without changing the coverage levels and um and not impacting the employees, but what are other things that we can do to save money to try to curb these increases on health insurance. So self- insurance is um something that that we're very seriously looking into to see if we can try to manage these costs a little bit. Um, it gives us the ability to control our own destiny. Um, a lot of great things to self- insurance where you can kind of do some carveouts and and treat your plan in a in a really custom way um that we're pretty excited about exploring. Um, but but this is a this is a big um um hurdle for us and um we're prepared to take care of it and to address it and be creative with it. Uh but it's it's not something that um that we can ignore going forward. Yeah, it's a it's, you know, it's a great just chart, right? It's another chart that that we can use and look at and and try

to adapt to. Um, I use more colorful language as Brian and I uh we're discussing healthcare in America right now. Um, but for if you're an employer, this is this is a problem that is crushing everybody. We're not in this alone. I think we're actually much better suited because we use our benefits as a major compensation component. So, we're very creative with how we can do this. But, but health insurance as part of our benefits is is the most expensive part of that. The good news is it as a as a percentage of our total expenditures. It's small and we've done very well financially so that we're prepared to to adjust this. We we're not expecting to suggest any type of downgrade to a benefit, any type of downgrade to our compensation plan, any type of, you know, reduction in services. Um, Harrisburg will do better than than the region in in uh in most of these things and we'll do certainly a lot better than the nation in in a lot of these things. But we want to, you know, bring these same things to your attention so that you can kind of see how we're addressing what, where, and when. we we will see um an ability to to do better on salaries and and to kind of catch some talent who other people might not be able to afford in a market downturn. Um but at the same time, health insurance is a disaster and and we have not a lot of levers locally that you can pull on that, but we are pulling every lever that that we can, including even a a potential expansion of a benefit. One of the benefits that we um that we we're behind the market on and and I think we we lead the market in benefits. We're the um healthiest employer for a reason and it's because of our benefit package. Um most of our towns are are offering some type of

retiree health care. That's an incentive for a couple of things. One, in government, especially in public safety, folks are getting out in their mid-50s. Medicare is not kicking in until their mid60s and so there's a gap there. A lot of these folks hang on and work past. They can afford to retire financially but they can't afford medical plans. So offering a benefit there and you'll hear a little bit more about that when HR does their presentation in draft one. um we've come up with a way to avoid the pitfalls that the other communities have gotten in on this with a defined contribution instead of a defined benefit, but also offer that and make us competitive across the market. So, um not all doom and gloom. We're really optimistic and I think the next slide tells you why we're optimistic.

Yeah.

Yes. Um, so we went over this at at the retreat. So I won't go into too much detail, but essentially we're well positioned to continue carrying on as we have in the last four years where we had a high interest rate environment, but employee cost and material inflation were also high. Um, during that time, you know, we saved a lot of money. um we didn't finance a lot of projects and um you know but but by saving money and investing it and earning money on that uh we set ourselves up for projects in the future and exactly for the time that we see coming in the next four years which is a lower interest rate environment and one in which employee cost and materials deflate actually in their cost. Uh so contractors become a lot more available. Uh projects get a lot cheaper. We can finance them for um much better rates that carry us forward 20 30 40 years um with outstanding interest rates. So um so we can move into that type of uh economy and and take advantage of it and do really well and we can continue in the economy that we we've had for the past four years and we've done really well in that economy as well. um both in terms of our financial position and in what we've accomplished in with the projects and everything that we've we've um accomplished in the last four years. You know, we can still get a lot done in um in an environment that's not really conducive to that. Um but if we flip over to one in which you personally um act a little differently than we would, um you know, we're positioned well to um to take advantage of that as well. All right, couple more minutes here and then I'll have some open discussion. But I did want to flip flip back to this and and drive it home for those that weren't in the in the retreat. A lot of our staff members uh weren't in the retreat and we had two other members here. On the left is just a you know our current

economy. We've done great in that. We we've we've got great financial balance sheet. We've saved money. We have not indiscriminately thrown money at problems. We've picked and and choosing our battles and we've invested really well in in a good economy. Um on the right side of that, in a bad economy, there's a lot of great opportunities there. Cost of goods and services generally go, you know, through the floor. We will recommend leveraging all of the good work we've done in a good economy should we switch to a bad economy. That's the time to build more greenways. I see Jim back there, so I'll give him a shout out. Right. Um that that'll be the time to activate Uncle Wall-E on our our comp plan and our greenway plan and get get him out there um hitting the streets for us. Um as costs come down, we'll be able to afford more things. They're a better value. We've saved money in order to do that. Also, the cost of money gets very cheap in a bad economy. And we've paid $20 million worth of debt down in the past four years. So we have a lot of debt capacity that we could get below the cost of inflation in a bad economy. That would be the time where it's smart to take on debt service. That's when you go out and you get money for parks expansions, road expansions, you do all of these things that we talked about putting on a shelf because we can't afford them now. All of a sudden the roadway, the transportation projects, those become real affordable. And generally the state and federal government give us money to do those anyway. So, I just wanted to hit that for those that didn't have the cliffnotee version um from before.

Bri, before you jump here, as you're exploring like insurance opportunities and self insurance, have you explored at all like what a captive insurance would look like, especially as you're planning ahead trying to reduce it als No, we haven't. Not that. It's an opportunity to try to pull money. Um, if you're explaining the idea of a self insurance and you build that up before you actually Okay. Yeah. Well, we'll have to

we use two really really smart Yeah. So, I'm I'm sure they were considering it. It's not a term I'm familiar with. Um but this year as part of of the self-insure investigation um we have a specialist that has tons of I'm assuming that is one of them but we'll ask on that because there's a break even point you know for us we're almost there can be used for healthare most often is used for liability risk but it can be done and there's there are some that are even that's an area of focus this year for us is the casualty and liability insurance as well. So, doesn't hurt to look into it.

Perfect. Um, you know, just just down the home stretch here. We just have a few more few more minutes. And I just want to point out, you know, this process that that we've went through the last several years of just kind of building a stable foundation. Guys can oo and at Brian's transitions there. Round of applause. um setting that that vision, mission goals, building those partnerships, moving into to you know what Lee went over that that constant process improvement. Being good isn't good enough. We want to be great and when we're great, that's not good enough. We want to be more great and and there's always some little amount that we'll be able to to improve and that's what keeps us ahead of the game as well as just those major capital projects. Doing them before they they really need done and trying to to to stay ahead of our partners ultimately gets us to the point where we're at today, which is that transition to long-term execution. We're not looking to get off our mark. Our community is very discerning. They want nice things. They have nice things. They want to continue to have that small town feel and that charm, although they want to make that more inclusive to everyone. We want to continue to grow. We just want to do that at a sustainable rate, 3, 4, 5%, not 15, 16, 17%. And as we move into this budget, our goal is to really execute on all these great plans that we've put into place. the transportation plan, finishing up a comp plan later this year and executing on that. The wreck mark the uh comprehensive recreation master plan which we um all are very well aware of and then the strategic economic development plan. We've gotten great collaboration with our residents, with our board members, with our staff, with our stakeholders. These are well thought and and well-invested plans. We've been

executing them very well and we're going to take whatever opportunity stands in front of us. Be it the continuation of a great economy, be it turning into a bad economy or somewhere in between where we may have a better local economy than than the nation as a whole. All of those things, we have options to continue to to work these plans. And that's a good place to be. Not everybody's in in that arena. We're also planning to to maintain our our public safety focus. We've ramped up our fire staffing and our investment in fire. We also ramped up our police staffing and our and our investment in police. Now, it's time to take a look again at long term. Where are we going with those? We've done a great job getting to where we're at. We probably need to take a year and do a more in-depth look at um our public safety and understand what problems are facing us as we move down the road. We do have um some other topics here to just spur conversation if we didn't cover anything. I think the biggest one are those connected neighborhoods, right? The the fundamental character protection of our existing neighborhoods versus making the town is as navigable as possible for automobile traffic. Those aren't possible. One of those two has to give. As we've discussed this before, we I think the consensus from our community and the consensus from the room is we want to protect our neighborhoods and make sure that we're not fundamentally changing the character of them. But we have to be able to communicate that out to our residents if that is our ultimate decision during the comp plan and amongst this group that we're not going to blow open our our neighborhood roads in order to relieve some of the congestion. The trade-off for that is there going to be some congestion. we can solve future problems, but if we're not going to reach back into the past and open up old neighborhoods for through routes, that's

going to limit us on, you know, how much congestion we can really, uh, alleviate. I think if you were to ask the average resident, um, they're going to say, "Open up the roads." If you ask the resident, "How about your road?" They're going to say, "No, no, no. I no, I'd rather die than it be my road." But that's a that's a a good conversation to have with people is how much empathy do we have for our neighbor versus how much do we have when we're sitting in traffic and what is that path? I don't think we're, you know, fully um done discussing that. I think the comp plan is is ultimately going to help us um get to that point, but I think that is our, you know, our big ticket one on the horizon. I think we're well aligned on almost everything else that we have. But, um, I'll certainly open it up to to any public comments before we kind of just go over, um, the calendar for the rest of the, uh, budget season.

I'm sorry. Uh, for board comments, I shouldn't have said I think the mayor's going to be pushed for time. Um, unfortunately we have about 6 minutes left, but I did hit my mark. You did good. All right, I think that's it. If not.

All right, so back to our budget calendar. So, um, three more workshops in our two council meetings. Um, we went over what you can expect, uh, for workshop two that we'll provide to you about a week ahead. Uh for workshop three, this is our draft two balanced budget. So again, always balanced. Um the 10-year models and everything are always successful when we provide those to you. We won't bring you a deficit budget, right? That's our job. That's our job to bring you a balanced budget and and let you know what we can do with the money we have.

Um so this is a management recommended budget incorporating the feedback that we've received to date through all through all of the um workshops that we've had so far. Um, we'll discuss new programs, capital projects, and long-term planning decisions in this workshop and establish areas of consensus anywhere that we can. And when we leave this meeting, we distribute the interactive uh council exercise, which um where you're allowed to um vote on new programs, new capital, new personnel, and see how it affects the 10-year financial model. As you make those choices, uh we bring those back together. If there are um any changes that we need to implement it as a result of that uh council exercise, we blend those into the budget. Um we'll highlight any changes from a prior draft and produce the manager's recommended budget preview and assuming everyone is in line with that. Uh it brings us to our public hearing on May 11th and our council adoption on June 8th. And that wraps us up for the evening. Mayor, the floor is yours.

Any other questions from council? I know we got two that need to hit the road. So, good. Then with that, um, is there a motion to adjourn? Second. All in favor? Motion carried. Thank you all. Second. Thank you.