Budget & Finance Commission - Regular Meeting

January 9 meeting of the Commission, the Budget and Finance Commission to order. Could we start off with a roll call please? Commissioner

Marion?

Here.

Commissioner Yessi?

Here.

Commissioner Castle?

Here.

Commissioner Woodham?

Here.

Commissioner Samples? Here. Vice Chair Allen? Here. And Chair Sherban? Here.

Thank you. Could we have the Pledge of Allegiance? If we all stand, please, and salute the flag. I pledge allegiance to the flag of The United States Of America and to the republic for which it stands, Thank you. Item D, approve the order of agenda. Next is to approve the order of the agenda. Is there a motion to approve the order of the agenda? So move. Second. Thank you.

Item E, blue folder items. Do we have any blue folder items to add to the agenda tonight?

There are no blue folder items.

I think we were supposed to take a roll call for the agenda to approve.

Oh, yes.

Sorry. Pardon me. Could we have a

roll call, please?

Sure. Commissioner Meering?

Aye.

Commissioner Yessi?

Aye.

Commissioner Castle? Aye. Commissioner Woodham?

Aye.

Commissioner Samples? Aye. Vice Chair Alley? Aye. Chair Sherban?

Aye. Thank you. All approved. Go ahead. We can move on to the consent calendar. Okay. On the consent calendar,

let's see. Could we have an approval of the affidavit of posting for the regular budget and finance commission meeting of 12/12/2024.

I move that we approve the consent calendar.

Do we have a second? Second. Thank you. All in favor? Thank you. Then item G is excluded consent calendar items. Are there any items?

No. We can actually skip to J, J1.

Have to do public participation first.

Is there any public speakers here that would like to speak or comment on consent? On the current item, item J1? Okay. Sorry about that.

There are no Zoom or Any comments? Zoom comments as well.

There are no Zoom comments.

Thank you. Item J1. First of all, I'd like to thank my fellow commissioners for their trust in appointing me chairman of the Budget and Finance Commission. During the last few weeks, it's come to my attention that my preexisting commitments are interfering with my desire to do the quality job that I know we'd all like to have. So I'm currently working as director of finance and accounting for an aerospace electronics firm, fifty hours a week plus doing some charity fundraising work.

And then also, given the current political situation at the national level, I can see there's going to be a lot of initiatives that I'll be wanting to do during the next year related to gun violence and also our single payer medical initiatives that I personally would like to do. So consequently, I'd like to ask the commission to consider appointing our vice chairman, Commissioner Jasmine Allen, to the commissioner position. Chair. I'm sorry, position. And perhaps exchanging it I would exchange it with her so I would be perhaps the vice chair person.

So if anyone would like first of all, Commissioner Allen, would you be interested in making that switch if the commission so desires? Yes. Do I have any other discussion items on that? Any other comments?

No. No concerns on my end.

Good. Anyway, as I say, I will be happy to continue on in the vice chairman's role and look forward to working with our new chairperson, Commissioner Allen. Is this something that

we have to vote on? Or can you just do it as an edict because you're the boss?

Executive

privilege. Shall we take a vote on it? I think that can't hurt. Certainly. Let's go ahead and take a roll call vote then.

Just before you vote, we had a couple of people walk in. Are there any public comments? Okay. All good.

So I move that we the we swap the two positions of chair and vice chair as was suggested. Do I have a second? I guess the only other question is when does this become effective, tonight or next

week or I would next propose that it takes place beginning with the next meeting. Then I

move that we make the exchange effective at our next meeting.

Okay. I'll second.

Roll call.

Those

in All in Yes. Pardon me. All those in favor?

Aye.

The opposed?

I can do.

Commissioner Marin?

Aye.

Commissioner Yessi? Aye. Commissioner Castle? Aye. Commissioner Woodham? Aye. Commissioner Samples? Aye. Vice Chair Allen. Aye. And Chair Sheridan.

Aye. Thank you very much. Can we move on then to Item J2, discussion of maintenance. Commissioner Allen had requested that we add this item to our agenda for our last meeting.

So last time when we were at this meeting, we had a resident who made a public comment and he was concerned about the fact that our I think in short, he was saying that our committee should be responsible for creating, having a budget for repairs and maintenance of our facilities. I think that's a valid concern, so I want to discuss with the committee and see what is our responsibility. Should we have in our budget a place for maintenance of our buildings? We do not currently have that. That's why we had to go and ask the residents to raise the taxes.

So this is something I think it's a valid he had a valid point. I understood what he was coming from.

Maybe we can get a little bit of historical background from our finance director.

Yeah, so I mean, I would probably have to talk to our public works to get all the detail you're looking for on this. We do budget for maintenance every year. It's visible in the city's budget. We can highlight that for you and share it with the commission. We put money towards that every year.

The real issue with the city's large buildings is that some of these buildings are from the 1950s, and at some point they are just not good anymore. So no matter how well you maintain them, at some point they have a useful life, and that useful life is over. I think that's the case for many of our other buildings that we didn't put forward for repair under this bond because we wanted to focus on the highest priority, which is our public safety. But in terms of city maintenance, the city definitely actively maintains all our buildings. We can point that out to you.

I think if you wanted to have a discussion about whether the city could do more to maintain the buildings and whether that would extend their longevity. Again, I think that's a question the public works director would be able to speak to better than I could, but I can assure you 100% we are maintaining our city buildings.

So the question is maintain are we maintaining our buildings? Obviously we are maintaining our buildings. The question he raised was we just went to the taxpayers and we ask additional millions of dollars from their taxes. Shouldn't we already have that in a budget somewhere?

Or should

we I think, to her point, I think it is in the budget on a yearly basis. If you look at the line item by group, whether it's it's public parks or fire or

police I'm

not talking about the maintenance.

Yeah.

But I'm talking about if we need to replace a building So from

there have been discussions about replacement even prior

to this.

There's some that's a a pretty much of a fundamental question between having us what might be called a sinking fund where you tax people currently for something that's going to be done in the future or you use a bond issue, which actually then is equivalent to having people in the as you're using the facility paying it on a more current basis. So I think maybe that was his sort of question, why all of a sudden are the taxpayers being asked to do this? But it makes sense to say that for the next thirty years or so, if you use a bond as your basis for financing it, that those people will be the people that actually pay for the use of the facilities during that period of time versus the last thirty years' worth of Peoples' tax revenue being used to replace I the think there's some fundamental questions, just basic questions about how you finance versus what specifically happened here that creates an opportunity for us to finance it with bonds.

A couple of things in talking to the public about Measure FP and the need to replace the stations, there were a couple of things. People did ask the question about why haven't we saved this money annually and to save in our $100,000,000 budget to save $90,000,000 even if we did 3,000,000 or $4,000,000 a year, it would take us another twenty five years and it would cost $300,000,000 to do it in twenty five years. The other issue is although the buildings, they needed maintenance like roofs and things, but a large driver of it is that the buildings were built in the 50s. So, for example, at our fire stations, a lot of our trucks, our newer trucks are just large enough to fit inside the buildings and close the doors. And then in the yard of Fire Station 1 and Fire Station two, there are auxiliary trucks that there's just no indoor space for them.

So they're actually left out in the weather. So we actually just need larger larger building in both locations to accommodate that. And the same for the police station. So it was a combination of maintenance issues, but also just we need larger facilities versus the city when it was built, those were built in 1955ish. But I think in our budget, if we bring in the, I guess, the city manager speaks to us and also public works, they can talk to us about the plans and maybe we need to spend more money annually. What would that number be or if we're

What would have happened if measure F. P. Did not pass? I mean, you're relying so much on the bonds. So what if it didn't pass?

If it didn't pass, then would it have to look for some other way of doing I think that's true. There's not a lot of alternatives to doing that. I think it makes sense fundamentally to do it that way. But if the public doesn't want to have it done that way, then

Measure FP was just for fire and police. We also need to replace public works, the yard. We have other facilities. I don't know if people are going to pass another measure for those facilities because they're not as popular. So I guess what I'm trying to see if anyone else thinks that maybe we should have a fund for those projects.

This is a problem that happens in all cities, as was brought up earlier. Do you create fund for future upgrades, or do you pay for it at the time that it goes into service and then pay for it for the next thirty years afterwards? And a lot of cities have a similar problem to ours and that is that there was some very, very poor fiscal planning when it comes to these buildings. Not only are they too small for a lot of things that are going on, but they also haven't met the essential services requirements of public safety buildings for probably the last twenty five years. And the fact that the city council, the city manager, and the rest of our organization made no plans and didn't even put away a part of the funds that were involved, I think it's a worthwhile discussion.

Maybe we can't put away 100% of the funds that it takes to replace the building in thirty years. Maybe we can put away 35% or 40%.

A down payment?

Yeah. Or it might

be a bigger discussion even in line with emergency reserve that you brought up. So again, there's about how do you plan for the future and one things that are known, is the obsolescence of a building over twenty five, thirty years versus emergency reserve funds like they actually brought it up today around the fires. Does LA County have enough emergency reserve funds to fight these fires before federal or state other funds come in. So these are things that from a budgetary and fiscal perspective we have to think about.

It will also be good to find out what other cities are doing so we can look for best practices. And if there is something that we're not doing that the other cities are doing, then I think that's worth looking into.

I do not know any city right now. I haven't done a lot of research, but I think they're all unprepared. They're all reactive because that's the government, and that's what we do in government, we react.

And budgets are tight, and so you have to kind of make the decisions in terms of where you're going to allocate your funds.

They have a similar problem with the one we have. Just last month when we talked about the emergency reserve fund, that's a big number that we're talking about.

Yeah, that's another $3,000,000 a year.

And where does it come from? It comes from paying for all these other maintenance things that we're talking about or it comes from cutting back on personnel or doing something like that because unfortunately, we're not in a place where we can just build a new shopping center and get more revenue for the city. It takes time for all this. But I think it's a worthwhile discussion. And just like we had the discussion about the reserve fund, I think having some fund for some of these buildings I think is important and certainly not waiting until the apparatus won't even fit in the building before we go, Oh, my God, there's a problem.

I mean, can see these things coming down the tracks years in advance. It doesn't make any sense to wait until after it's a major problem. And I would actually I'd ask a very another question. When you're talking about the fire apparatus that sits out in the elements, what does that do to the cost of maintenance on the fire apparatus that's not being housed inside the fire station? Is that increasing our costs?

I'm sure it is. I toured Fire Station 1 and it was an auxiliary pickup truck that they use. But there's just no internal space in the station to park it. So it's a block from the beach and out in the elements and I'm sure that that has an effect on it over time.

And the chief's vehicle sits outside?

At least so.

All the other supplemental vehicles, they sit outside. It's not a good situation.

In addition to the question of how you plan for the capital replacement is the very real issue of

day

to day maintenance. We've got roofs in both of those fire stations that leak. We've got roofs in the police station that leak. That borders on abandonment. We're basically saying we're not going to put any money. It's one thing not to have money to replace the building, but it's quite another not to maintain the building for the basic safety and comfort of the folks that we hire. So we're not doing either one.

I'd just like to state, I mean, again, the Public Works Director has better information than I do, but I do believe that we are actively maintaining these buildings. It is very possible that leaks happen, but I am quite sure that we're not letting, you know, our firefighters and our staff have a leaky roof for weeks at a time.

Things are much better today than they were five or seven years ago.

There

was a lot of deferred maintenance that shouldn't have been deferred, and the fire department was actually here at one point and talked about the deferred maintenance that was affecting their operation.

Do you have any data on how much we have spent and what was budgeted in the last five or ten years?

Of course, yeah.

You can take a look at that and see if there is some trend that we can detect

from there. I don't know what the structure of the department budgets are, but wouldn't the department, fire department and police department budgets require them to address the maintenance issues?

So normally those would be in our capital improvement program budget. We'll have again, I really need to get the public works director on this, but we have citywide maintenance accounts and that's one of our capital improvement programs. So every year we allocate an amount to that, and we but and we, you know, use that citywide as needed.

And on the capital improvement side, all these things that we're talking about would fall under capital improvement. I don't remember what the changes were, the group that was working on the charter change, but the old charter said that if we had any project that was worth more than $25,000 or was expected to last more than ten years, it had to go through a CIP budget process that typically took between one and two years. So doing something simple like replacing a roof process and could take two years to get fixed.

So the charter changes definitely have improved that situation. I mean, as you just mentioned, we've been a lot more effective in the past few years and a lot faster at getting through our capital projects. So again, this is not my area of expertise. I'd also just, you know, given the number of items that this commission has brought up and kind of the work plan that we're thinking about as city staff, think about when you'd like to think about this, how to prioritize it. As you mentioned, you know, you made, I think, some helpful recommendations regarding city reserves.

Is that more important than looking at our long term replacement of our city buildings? So from a staff perspective, thinking about our workload and for you as well as commissioners, about where we want to prioritize.

I think we can take some comfort from the fact also that our new city manager, a couple of years ago, came up through that route, public works, and he knows as much about public works as the people in public works. And I've noticed a difference in comments from him at budget time about how much money should be spent in that area. So I take some comfort in that.

Absolutely. It has certainly changed in the last few years. It has changed a lot. I think it's worthwhile to have a little bit more of that conversation. And I would suggest what we're doing here, if we could continue this item in some future meeting and whether it's the city manager or the public works director talk about this in more detail and see what their plans are and what they're thinking and see how we can go about supporting them. Think that would be our best move right now.

Put myself in public director's shoes and what I have seen, I've worked in public works before, public works director goes list and he says these are all the items I need to repair. And then is there money for it? And then he has to prioritize because there is no money for it. So it's not his fault. It's not on his shoulders because we need to give him money to do his job. Well, it's not just

him though. He takes the list and he prioritizes the way he believes it needs to be prioritized. The other department heads prioritize it based on what they think their needs are. Then it goes to the city manager, then it goes to the city So you have like five different entities that are determining priority. And it's really tough to break it down when everything on the list is priority one.

Yes. The obvious simple answer to all of this is that we need to increase our revenue. And how do we do that? I'm not suggesting I don't want anyone to say I'm suggesting to increase taxes or SST or anything. But we need to how do we get revenue?

And what I've seen other cities do to increase revenue is they bring in more businesses to the city so they can get their business taxes and sales taxes. So this really comes down to us, our city, not having money to spend. So no, we cannot create a fund for future and think long term if we do not have money. And in our personal life, what do we do? If we're broke, we go get a second job. I think we get a

better that's probably the intent with the development of the Galleria Mall or the Waterfront or the Power Plant. Those are longer term initiatives to build businesses and drive more revenue into the city.

So one thing we should start thinking is how much money will those entities bring and start planning to put those funds away for certain things?

Well, we've got two sides of the equation. There's how are we managing the money that we have and how are we spending it? How is it being prioritized? I think that's something that we can get some answers about and some thoughts from the department heads of how that's going right now. And the other side is how do we generate revenue? I'm not sure where we start. Maybe we turn all of our major thorough fares into toll roads or something.

I think maybe having the city manager talk with us and explain to us what the process is and what in terms of his priorities and the money that we have available and is that something that can be moved from a category to category and who are the people that make those decisions. That I think helping us on the expense side. And then if we determine that that apparatus is not sufficient, then maybe the revenue side is the other place that we have to go. But perhaps visiting the existing priorities and the existing structure, budgeting structure, might be the first step.

And I think because, again, it goes even like near term versus long term. You can look at the expenses we have now and do some near term changes and some allocations and look how we're going to manage things fiscally. But like driving revenue, that's just longer term. That takes five, ten, twenty years and setting up now to plant the seeds for later.

And we need to start planning long term, not just short term. So we've got to start somewhere someday.

Yeah. I think having this kind of input now for our committee would be a good idea because soon we're going to be in budget decision areas. And the city council is going to ask us to take a look at the budget proposals. Right now we know that one of the things on our list is how to fund this emergency fund. If we have a better idea of what the city's planning and what the goals are, we might be able to provide some better input to the city council when they get ready to make their decisions. We have

on the future agenda to have the city manager come in and speak to us before the budget process.

Yes. And I was just going to say, I mean, I think that's an excellent point about preparing for the budget. That's exactly what the city manager likes to do when he comes in and talks to you is come in and say at a high level what we're trying to do with the budget. And of course this is based on council direction, on council priorities. So that's the mindset that go into the budget with.

He comes to you early, tells you kind of where we're going. If there are specific items, you know, addition to the reserves you've already mentioned that you think are important, that's something that we can, you know, communicate throughout the budget process. And I think, again, if you're coming with a lens of what these priorities are in maintenance and these other issues that you've brought up, that's going to be a really helpful addition to our budget decision making.

Perhaps we could have Mr. Wacinski come and speak with us about that process even prior to the time that we really get down to the hard tax of coming up with those budget issues.

Well, our next meeting is February and then we're going to be talking about budget.

Yep. It's coming up fast. Needs to happen fast. You remind me, is this strategic planning that council does, is that a public meeting? I know different cities I know sometimes they get a consultant to come and help them and they spend a

whole couple of hours.

And am remiss in not referring to that earlier in this discussion. So it's public. It's all videoed. We had this in January. No, not January. We are in January. I believe we had it maybe in October, but there's a video of it. I can send it out to the group. That is actually a very clear insight into council's priorities. So that's a great document. So we have the strategic plan that council approved. That's available. Again, the discussion is available by video. We have minutes so we can share that with the group.

I would suggest that at least some of us attend that meeting. So I need to make sure I have it on my calendar that we attend a meeting and we ask questions. So we're there with them thinking together and giving recommendation in real time.

Sorry. It is public in the sense that the public can attend, the public can ask And I'm sure you can, yes.

And that's

all I'm saying. We just need

to put it on a calendar and a few of us need to tend to understand.

So it won't happen again until after after

the budget process.

I would suggest that the city manager attend every meeting, at least for the next four, three or four months because we have so much to discuss and we're not getting the answers that we would really like to have to provost to be able to provide some input to you and then to the city council.

Well, I would say let's get the right resource. I don't think it's necessarily the city manager to answer all of our questions. I think a lot of this can probably be answered by the public works director or someone within public works. Our city manager is probably pretty busy right now working on budgets.

And I think to your point, you know, we would love I would personally love to be able to respond to every question that comes up at these meetings. You know, a lot of times if we have a specific item on the agenda, I'll have done some research on it. I'll be prepared to do that. Some of these wider ranging topics, I'm just not going to be here prepared to do that. That's why we discuss, you know, can we put something specific on the agenda at a future date? And we can be prepared and have the staff ready to get you the answers that you need.

Do you think we should have the public works director speak to us before the city manager comes in for the official budget discussion? Do you think that that would be helpful?

I'll talk to him. I think normally there is a joint meeting with the Public Works Commission prior to the budget process that's about capital planning, specifically in the capital budget. So that's one opportunity that's already there. So I'll bring it up to the public works director and see what he thinks is the most effective way to do this and to to answer the questions that you're looking for.

The joint meeting is ordinarily in April, if I recall, and that's pretty deep into the process.

You know what? I'll double check on this. There may be another opportunity or perhaps, you know, our regular meeting when we have the city manager come. We could also have the public works director come. So I'll take this back to our city manager, take it back to the public works director, and we can discuss how to best address this.

Yeah, I think it would be nice if we could get the public works director in a little bit before the meeting with the city manager because that would prepare us to be able to ask the questions of the city manager that might have arisen with our discussion with the public works director. Now let's try to take this

one step at a time. Yeah. Okay.

Super.

So I move that we table this item for the time being until we can get a representative, an appropriate representative from Public Works to discuss this item with us in preparation for our meeting with the city manager and going into the budget cycle.

Oh, I just want to step in. There's no public comments at this time online and none in person.

I second.

Commissioner Marin? Aye. Commissioner Jesse?

Aye.

Commissioner Casa?

Aye.

Commissioner Williams? Aye. Commissioner Samples? Aye. Vice Chair Allen? Aye. And Chair Sherban?

Aye. You. Let's see, then we're going to be moving on to item J3, I think, the major FP, what the next steps for us are. And I think our director of finance is going to be answering that question for us.

I will. So good evening again, commissioners. We have a short presentation for you tonight. If you watched our December 17 City Council meeting, this will look very familiar to you. It is almost exactly the same presentation that we shared with them that night.

The purpose of this was to give counsel and now to give to you a high level overview of the city's kind of strategy and approach to implementing Measure FP, including some immediate next steps. So at that point we asked council for you know, we're sharing them for information, we asked them for any input. Council was very supportive of staff's recommendations including involving this commission. So I'll just go through this and I'll have time for questions and some commission action. So as you know, our Measure F P was approved November 5.

71.4% of Redondo Beach voters. I'll just say again, you know, we've heard from many consultants, we've heard from other cities that this is not a common thing to happen. This really expresses Redondo Beach residents' strong value for our public safety and strong confidence in the city government to spend this effectively. So we're very excited about that opportunity and we plan to execute this very well. $93,350,000 general obligation bond measure that's going to replace our Fire Stations one and two, our main police station, and renovate our police annex.

Some immediate next steps and I've highlighted the finance ones for this group for obvious reasons. First one, we've actually already issued an RFI RFQ for a financial advisor to assist the city in all aspects of the bond issuance and management. Since already sent it out, you can tell this is the highest priority to get this person on board right away. The financial advisor serves as a fiduciary for the city, acting in the city's best interest and kind of helping to manage the whole process and the team. Another immediate step we're looking at is to improve reimbursement resolution.

We'll work on this with bond counsel once they're on board. But this is important for us to establish a basis for tracking our costs related to the bonds as we can recover those from the bonds.

Quick question. Item one, the financial advisor. Last time we did the bond issue, we used Cosmont Consulting as the advisor. Are they no longer in the picture?

They are, and we've asked them to participate in this process. We wanted to open it up and do a competitive process to select an advisor. Cosmont was already involved in a lot of the kind of pre work with the pension obligation bonds at our last go round, which I think is part of the reason that we brought them on. But we wanted to do a larger competitive process this time.

Just something I know they're very expensive. Do you know their hourly rate off the of your head? I do not know. More expensive than attorneys.

I'm sorry.

They're even more expensive than attorneys. From the numbers I've seen from working with them previously, I think, I mean they were over $300 an hour, $4.50 an hour. So I am very happy that they went and are looking for an RFP for that.

We'll also immediately in other areas. So we have finance side and then we have the very large project management and construction side. So we'll also be looking to do an RFQ for a project or construction management firm. There are many different models for this. There's some detail in the report to counsel. This is, again, not unfortunately my area of expertise, but we are looking at some of the there are some very large established firms that do this as a specialization, and we're looking at that from everyone we've talked to. Best practice is to bring on one of these construction management firms to help us manage the whole process.

So has an architect been selected and designs for the building done?

Absolutely Why would you bring

on a construction manager before you have a design?

So again, these are firms to help us manage the overall process. These are not people who are going to necessarily construct the building. They are advisors.

You mean outside of the pure construction phase?

Exactly. Yes.

It's prior to the design and construction phase.

But prior to the design? I guess I'd have to see more detail. It makes no sense to me.

Actually well, following this I can take a look in our admin report because I think it explains it much better than I'm doing here today. But yes, this is we have not selected design, construction, any of this. Another immediate item that we're pursuing with our city attorney is selecting

Wait a

minute. How

did we come up with a $93,000,000 budget for this if there's been no design work, no pre work, and we're getting ready to start construction?

Are definitely not getting ready to start construction. We worked with a firm that does cost estimating within certain parameters to develop a very detailed estimate for the construction work.

Okay. Well, then let me do this. We just heard about Fire Station one being too small. We've heard about the police station being too small. Heard about Fire Station two being too small. Does that $93,000,000 include property acquisition in order to build this thing?

So I do not believe we're going to need to purchase property, but yes, this 93.35 and again we built in some contingency for this. If you paid attention or if you watched any of the council meetings, you'll see the 93.35% included contingency. Council added additional, I think, 5% on top of that. So we are quite confident that this will be sufficient for the work that we'd like to do.

Okay.

Just a quick thought. The last day or so we've all seen pictures of total devastation, and I would bet that some of our estimates for capital expenditures are going be thrown out the window because we're going to be rebuilding the area is going to be rebuilding houses and businesses and hospitals and schools out to Wazoo. So we may be affected by that $93,000,000 for something beyond our control just because of what's happened in the last two days.

Right. Both at manpower and material. Yeah.

So that's obviously true and not something we imagined. Yeah.

But I want to say

As of three days ago.

The city council, they had a large contingency because there were design issues that could potentially come up. But I want say it was a large contingency for the construction project, like 15% or 20% more than the actual estimate from the firm that prepared it. So there's a lot of wiggle room, but again, no one was preparing for what happened. Think,

too, part of what we'll plan for with financial advisor is how to sequence the work and how to tranche the funds. So for example, if we think there's going to be a huge spike in construction costs in the next however long a time, we can say, know what, we'll issue a small tranche of the bonds to begin with to do the design work. Maybe we can put off a lot of that larger construction till costs have come down a little bit. So these are some of the things that we would work with both the construction management advisor and our financial advisor. So also we'll be selecting bond counsel.

They will provide the legal opinion regarding the taxability of the bonds, and they will also help us with the reimbursement resolution and in general just establishing the legality of the bonds. Something else we brought up to city council that they were very supportive of is to establish a special project manager position in addition to existing city staff to kind of serve as a point person to manage this whole project. There are a couple important things about that. One is that existing city staff and they are full time jobs and managing $93,000,000 is kind of a full time job. So we want to make sure that we have someone to be really proactive to do everything related to this work and without having other work suffer.

Another point is that we'd like that person to be within the city manager's office. We have a lot of stakeholders here. We have our police. We have our fire. We have our public works.

They may have differing opinions and we really need a strong point person to kind of corral these views and make decisions. So we can again, we can pay for this with bond funds. We've discussed this with several financial advisors and they've said this is something that's very common with these bonds and it pays for itself in added efficiency for the project. So again, we're figuring out what that would look like, whether it's a consultant, whether we hire a temporary position or a kind of limited term position, but this is something we'll be looking at.

Is there a provision made in the bond issue for the special project manager?

Yes. That's definitely an allowable cost within the bond issuance because they'll be focused specifically on implementing the projects.

You mentioned number two here is select bond counsel. In the materials for the commission meeting, you also mentioned disclosure counsel. I'm not familiar with that. Those can't be the same firm?

So they can be, actually. They can be the same firm. Disclosure counsel just does slightly different things. A lot of times they deal specifically with the closing. So they deal I think I put it in there, but they issue a couple of opinions with the closing.

Historically, the city has had two different firms for this and is largely just because of specialization. So some law firms specialize in one versus the other. And the city has found it helpful to do that. So here's our financial team. Managing this is a big process.

And again, so we assemble a whole set of advisors and consultants for the city. Again, this is best practice. This is straight out of GFOA, any other place place that we can look at. So we have our financial advisor as I mentioned. Eventually we will have underwriters to actually sell our bonds.

These again will go through a competitive process to select. Bond Council and Disclosure Council, we're working with the city attorney's office now to develop a list and identify these entities. And finally to actually manage the payments, we'll look for a trustee or a fiscal agent. And that just kind of depends what level of role the city would like this entity to take on. And again, the financial advisor is dedicated to the city, fiduciary to the city.

The underwriters ultimately do not work for us. They're trying to get the best deal for the people they're selling their bonds to. So it's really important for us to have someone on the other side. This is just a little bit again about our project planning and delivery. This is going to be our staff and outside consultants.

We again are going to hire someone to kind of serve as the city's bond project manager on the construction side. On additional staffing, there's the one I talked about, internal resources just dedicated to this. Yeah, serve as the day to day contact the day to day owner's representative and a single point of contact for the various entities that we're trying to that we're managing. Kind of gone over these already. Just quickly another item pretty large that staff has already started thinking about are temporary facilities.

So this is obviously very important for our public safety. So we've already started thinking about where are the best places to move these services temporarily during construction. So again, we'll work with our IT departments to figure out the best places for those and just work out the best timing for moving services.

To that point, have you thought about this far enough to know whether would you do both fire stations at the same time or sequence them one after the other so that you keep one in its current facility?

I think we're still thinking about that. I think the current idea is to do one at a time. But yeah, this is something that we're thinking about in terms of what can we move the most easily, what might take longer for us to build a facility for people to be in. So again, we'll work with our construction advisors on that as well. And then finally, we plan to establish a bond oversight committee.

This is actually a provision that we put in the bond language in case the statewide proposition passed that would have lowered the voting threshold for these bonding measures to 55%. That measure did not pass at the statewide level, but we still have the language in our resolution and we thought it's an important part of this establish accountability to the Redondo Beach residents. So we looked at many examples of this. In your report you can see a resolution or what is it the structure of another bond oversight committee just as an example. The majority of these tend to be for schools because schools issue a lot more of these bonds.

But so we are proposing setting up a Bond Oversight Committee. We're recommending they're appointed by mayor and council and just to be really clear that they focus exclusively on expenditure of funds. So they are there to make sure that the city spends the funds as required in the bond resolution, that we're spending funds effectively, so they won't be making decisions on design or operations or how we do the construction construction contract. They're specifically there to focus on our bond spending. So in terms of timing, the Bond Oversight Committee isn't as immediate, but we would like to get that in place before we issue the bonds.

So our recommend you know what, realized I forgot to say anything about timing here. I think it was in the report. But our general, very high level plan for the moment, again we're going to prioritize our financial advisor and our bond counsel. We hope to get those entities on board in February before the February. Tentatively, our thought is to issue the bonds in the summer.

But again, as we've seen, the situation really changes daily here. So something we'll work on once we get our financial advisor on board to establish the timing and think about how we want to issue the bonds as well. If we do one tranche, we're planning to do several tranches, things like that. So a recommendation for this Commission to receive and file this report and most importantly we're really looking forward to this Commission's expertise when we're selecting the members of our financing team. So we're asking you tonight to choose a member of your group to serve on the review panels for our financing team. So that's it.

Thank you, Director Meyer. Shall we open up the discussion to identify someone that might be appropriate to have on the commission pardon me, on the committee?

Traditionally, you guys always choose the chair. I think last time Commissioner Castle or Chair Castle at the time, you helped them with the audit.

Was for the audit But I think that this I mean, that was just interviewing a few firms.

I think that this probably requires a little bit more expertise than I have in that particular area. I'd like to suggest maybe that Commissioner Woodham might be more appropriate than myself for that role. You be Would you be willing to Sure. Function in that

And you were on the pension liability bond committee, the subcommittee was formed by the commission back then?

That's right.

Do you need to do roll call on this?

Hold on. We'll ask for public comment. So there's no comments online, and there is no comments in person.

Mostly there's to be a nomination and then a second,

then we'll do a roll call vote.

So I would move that we make Commissioner Woodham our designee for the committee.

Can I have a second?

Second.

Commissioner Marin? Aye. Commissioner Yancey?

Aye.

Commissioner Castle? Sorry.

Sorry.

Of of Board

Woodham? Aye. Commissioner Samples? Aye. Vice Chair Alley? Aye. Chair Sherbet? Aye. And passes.

I guess now then, do we have any items or referrals to staff? Any future commission agenda topics?

I'd like to go back and revisit something that this commission has brought up several times. We don't have, we yet do not have, a consolidated cost of what we're doing to deal with our homeless situation. And I would still like to see that before we go into budget hearings to find out what it really has been costing, the three year total cost of servicing our homeless population. That's police, fire, public works, the city attorney's office consolidated in one place.

And if we could also I think we get specific grants for various parts of that, if we could see what those grants are and what they total as well.

So if we can have it on the agenda that way, we'll certainly pull it up.

I'll just mention I did actually discuss this with our city manager since the Commission has brought this up several times. So we'll discuss this internally. It is, you know, again it's kind of one of a mounting list of items that we need to pull resources together to look at. So I will we'll discuss this again and come back with, I think, reasonable timeline to get this information.

Yeah. I might make a suggestion also. It seems like this is the kind of topic that's going to be a continuous demand as we move forward. There's going to be more people that are affected economically and they're going to be disadvantaged. And I think we can anticipate having more expenses, directing more attention to this, and I'd like to say that if we don't currently have the accounting architecture within the finance department, I can appreciate that this is an issue that's cross departmental.

It's not such an easy number to come up with, but I think we need to be taking steps or should consider taking steps to create perhaps in the private sector it's called a cost center or it's called a P and L center. Maybe this is a benefit center. But starting with a concept of this going forward and being a very, very important part of us to have to justify and to want to with respect to oversight, with respect to budgeting, with respect to departmental affairs. And each department probably should have a line item that relates to their contribution to this overall objective. That might be something that you consider because, as I say, perhaps you don't currently have that in place to be able to?

I think that we do have I think we have ways within the way that our financial system is set up to identify these costs and to pull them together. You know, we haven't done that in the past, but I think the architecture is there to do it. Again, it's just, you know, it takes some as I'm sure you know, having done this in the private sector, it takes some time and thought to do this correctly in a way that actually works the way we want it to work.

Well, in our budget, don't we have a line item in our budget how much the council had approved to spend on homelessness? I mean, that's we should start with that.

So, I don't see this as being strictly a finance department issue because all of these other departments allocate human resources and material and they charge it against what they or they articulate it as being a cost of doing business and a cost of dealing with the homeless situation. So each of the departments should have some place buried in their own internal budget, some line items that cover this cost.

I think, again, speaking at it from the private sector side, it's important to have the proper mechanics set up so that each department can properly account for that, both direct and indirect costs associated with that, application of overhead. It's not, I don't want to say it's such a difficult problem, but it's not such a simple number to come with unless you prepare yourself to do that. I think that's what I'm suggesting. Let's see what we've got now and then let's also design something for the future, which probably would be a finance department function to create that so that the departments can then participate.

And for the sake of conversations, remind those that you talk to that this commission has been asking for this for over a year. So it shouldn't be a surprise that they can't do anything with between now and April.

This is where AI comes in. You have data.

I would love to tell AI to do this.

Tonight and see what happens.

Have data, although you cannot get your hands on it because it's scattered all over. Same thing with the capital improvement projects. I've talked about it and I've asked for all the numbers. What was the original budget and what have you actually spent? The gentleman you had in one of the meetings, he said, we have the data.

It just takes time. Now, with the new technology, new artificial intelligence, you can get it at a lightning speed. So we also need another presentation by somebody from your IT side, cybersecurity, how are you going to use the AI tools to give us the data so we can do the analysis. It can even do the analysis if you have the right kind of software. Those things are never discussed and we just keep pushing it forward. That's not going work.

So again, I think maybe so I'll take all this back. Something that we could look at potentially at a future meeting is kind of all the agenda topics that we've discussed. So we have the homelessness reserves, future buildings, cybersecurity, looking at our schedule, knowing the other items that this this commission already is invested in, and just, again, see how best to sequence it and where to best focus your time and our time.

Now, I'm gonna to say this again. In other cities, this is actually a simple task to do because they have an account code and then everyone charges their POs to that account code. So all you have to do is just look at that account code because everything's been all the purchase orders are referring to that account code. I mean that's how simple I have seen cities tracking their homeless spending. So when you're saying it's not that simple and Stephanie is saying it's very complicated, it's going to take a lot of time to just get that number, I have no

clue how.

Our city manager and our fire department and our police department, most of their costs have to do with personnel. And when we see the budget at the beginning of the year, they have a tenth of a headcount assigned to X, Y, Z, and onefour of a headcount assigned to something else, and onethree of a headcount assigned to something else. And you don't know how much of that is actually related to the homeless. But there are these little pieces of headcounts, and it's pieces of man years, and it's tens of thousands of dollars to pay those guys for a And man it adds up, and we

don't So, this them people how many

hours of FOIA work was for homelessness.

And that's the point, because department, the police department, the city attorney has at least one staff member that's almost dedicated to this. I believe it's one. Maybe it's more than one. I think

that person may be grant funded.

And I mean, there are costs to do all these things. There are costs to transport these people. Somebody is accounting for those costs when they ask for budget at the beginning of every year. It just doesn't get rolled up to a single number across all the departments. And it may be that the police department calls it homeless and the fire department calls it citizen preparedness, so we can't put the two together.

I will also just say, you know, we prepare our budgets on a line item basis. So we don't do project based budgeting. We do not do program based budgeting. If we did that, that's where you would see things like citizens oversight or homelessness. That's not the type of budgeting that the city does. We do line item budgets. So we have our personnel, we have our contracts, we have our maintenance, we have right? So that's just not the way that our structure is set up. Again, it's not that we couldn't do That's just not the way that the city has set up. And Vice Chair Allen, if you have an example of a city that you've seen that does this in a way that you like, I welcome seeing that, and we can look at that as an example.

One of the council meetings in Torrance, the council member asked directly how much did you spend, how much does it cost to basically save a person from homelessness per person. And the staff, and I'm not in that department, they were able to just say it cost them $40,000 per homeless.

I've been very impressed

by them. That's why I'm kind of like We're not trying to beat up on you Because I understand you're

the messenger in this. But in order for any of these departments to come up with that line item budget that you're talking about and roll it up to the city, you don't have visibility into every item that they're putting together. They sit down with their own spreadsheets

and actually

this is how many people we have and this is what they're doing and this is what we're assigning that to and then it rolls up to the city budget.

That's precisely right and that's why I think our finance director is focusing on that, that if it's not set up in order to be able to collect those costs down at the detailed level, an officer works a half a day doing something that's related to homelessness, he calls it by another name public service, a half a day public service. That never gets rolled up into anything that has to do with homelessness because the police don't have their budget has not been set up in such a way that they address that as being an issue. But if we create that, as I suggested, if we create that as a cost element and structure it back down at the department level so that when that police officer spends a half a day working on whatever their homeless terminology is, then that can get rolled up. And until that happens, it gets considered to be community service for a half a day, so that cost doesn't really find its way up to the level that we need to collect the cost at.

I would also say, just as with any of these things, you know, you have a simple way to do it and you have a complicated way to do it. And simple is going to be fast and less accurate and complicated is going to take a while and get you a lot

of

detail. So I mean, if we just wanted to look at specific contracts, the people in the city attorney's office, the grants, that's not difficult. Right? We know what all of those are. Obvious things. If what we're looking at is x percentage of x number of staff time plus, you know, things that could be sprinkled throughout the budget, again, it's not that the data 's not there, it's not that we don't know, it's that that's just not how our budget is structured, so it takes a little while to put together. And there's also a cost benefit, right? So if we're telling our police officers, hey,

you

need to track every hour that you're spending on homelessness, and then when you fill out your time sheet, need to make sure to take this drop down and fill in 18 boxes to allocate your time. I mean, that's a cost as well, right? So again, I think it's just looking at the data and figuring out what is the best way to set it up to get the information we're looking for.

So I think the difference that certainly the difference that I'm thinking about here is when the police department assigns officers to the mall for security, they know how many people are assigned on that shift. And they put that in their budget and say, we're going to assign x number of people to the mall every day, and that becomes part of their budget. Whether those people actually charge those hours to that particular job doesn't make any difference. We're saying, what are the departments budgeting for dealing with the homeless situation? Whether it's police security at the Palette Shelter Village or it's public works cleaning out the sewers in the Palette Village, whatever it is, what are how many people are they putting on this?

How much is it costing?

I understand.

One thing I'd like just

initially get the simple can version we at least get the simple version?

Right now we have nothing. So when we get the simple roll up, better than what we've got.

Plus or minus 20%.

Yeah, I'd go for that.

One thing I'd like to point out, on October, LA Times had this article, How Redondo Beach Brought Its Homeless Numbers to Functionally Zero. So, they must have some data to come to this conclusion. If so, what is the data and where did they get it and how did they get it?

We will find out.

It's been three months. Before we do budget recommendations.

I will come back to the commission.

Not only is your playful, but you've got numerous plates that sound like they're full.

A couple of things. Government business is part of being transparent. Where we spend a lot of time. Totally agree That's required that we are transparent. Transparent.

Well, actually if you recall, one of the reasons this question came up is because more money was being spent to acquire more pallet shelters and do more work in order to get to that October 29 number. And we started asking how much is this costing, how much of it is grant funded, and what happens if the grant funding goes away. And that's exactly where I'm coming from because with all these other things going on, are we going to have grant funds to pay for this next year?

I mean I can tell you specifically that our palette shelter is all grant funded.

Yes. But again, to his point, is it $500,000 Is it $1,000,000 Is it $5,000,000 I mean, it's not 5, I'm sure. But, you know, we don't know the order of magnitude. And if the grants aren't funded from the state and we suddenly have to come up with money to either fund it or take it away from other CIP projects, we're just trying to get ahead of that before we're forced into that.

If it's $50,000 we can absorb it. If it's $500,000,000 we're stuck.

Right. It is not $500,000,000

But we don't know. That's good.

I'm going to boldly make that statement.

One thing I hear time and again is that you have data, but it's difficult to get it. And this is why I think we still need to look at some data analytics, AI and some tools which are available. Everyone else is using them without using them.

I would love to do that. Again, I think finding the right tools, making sure they work with the systems that we have, making sure they're integrated, making sure it doesn't take more time to use them than it does to than the value we get from them. I would love it to be a very easy solution. I don't know that it is, but again, I would love to have fast and easy to use data as well.

Can we get somebody who is in charge of IT come here and make a presentation?

I think we can

do that. I've talked to our IT director as well about coming and doing presentation with He this is very open to it. He just wants to make very clear that the information he shares in a public forum about cybersecurity is going to be very, very high level and strategic.

Because cybersecurity, I'm looking at the data collection and analysis.

He isn't responsible for that. That's the clerk's office.

Or if it's like database driven or something like that, it would be. But we can have them come

up. Yes.

Anyway. Very good. That's all

I've got.

What do we need to do then to have this be a continuing item with respect to coming up with the accounting for the homeless from a formal

I would say just put it on the agenda so that every we'll visit this every month until it we get an answer.

So a continuing item and then maybe we can come up with a timeline that our director can help us with so that we can get to certain points at certain points. And then I think that's probably the most practical way for us to go proceed. I think we all agree how important, everyone agrees how important this is going forward. Think I that will work for us.

So we had another item. So it's the homelessness that's going to be on the agenda next time. What was the other one that we said we wanted to get on the agenda?

IT director's presentation. Then the discussion of city maintenance.

Yeah. That's how we finance the building, the future buildings and things like that.

Sorry. So just to be clear, you're putting on these all on next month's agenda to continue the discussion?

Yes. And then to see if we have any updates or progress?

It's going be under continued items as

opposed

Okay. To Got it. Main agenda Perfect. And then they'll stay agenda until we decide to remove it from the agenda. So they'll be there every month.

Can't be from a previous agenda until we actually have it on the agenda and discuss it and decide to leave it on the agenda. Okay. So right now we're asking that these be put on the agenda. Under staff items. Under items for discussion. And from there we decide whether we're going to keep them or file them. So

be it. Do we have any other discussion items, or shall we move to adjourn?

Move that we adjourn. Second. In favor?

All in favor? Aye.

All adjourned.