Finance & Debt Oversight Committee - Regular Meeting

Good afternoon. Welcome to the, regular monthly meeting of the, finance, budget, and debt committee. And the clerk will call the roll.

Sarantu? Present. Driscoll?

Present.

Gaddis? Here. Hartman? Hobbs? Martinez? Three present.

Thank you, clerk. So this afternoon, gonna depart from our regular agenda. First, we're going to have a presentation on the Gordie Howe International Bridge, which, is almost completed. And I've asked former councilwoman and former deputy economic development director, and now the executive director of the Toledo metropolitan area council of governments, Tim MacKay, to present a presentation on, the bridge because I personally think, based on research and based on comments that I've had at several meetings, that this is going to be an economic engine that will benefit Toledo, Northwestern Ohio, and and Southeastern Michigan. So with that, Sandy, if you'd like to come up, there, or you can set up the table.

Whatever is easier.

Do I have a a way to, move the, presentation forward? Or I

I was to

say if you sit at the table, you'll be able to use the computer.

Let the record show councilman Hobbs has also joined us. Thank you. Good afternoon, council members and auditor Rebelski and chief of staff Frank. I'm grateful that, councilman Sorantu invited me here today because this is a topic that I really like to speak about. I'm also grateful to councilman Sorantu because in addition to his duties here as a council member, he is serving as our vice chair at Toledo Metropolitan Area Council of Government.

So he's, been really helpful, to us as vice chair, and we look forward to having him serve next year as chair. It's interesting to note that when sworn in in January, he will be the first chair from the city of Toledo since 1979, mayor Doug D. Good. And so we're very excited to have Toledo represented as a elected official chairing, the council of governments, representing 83 governmental entities. So it's very exciting.

And so I was able, to, bring today the the presentation that we the attendees at the Ohio Conference on Freight were able to see when when they attended, the tour of the bridge, at our recent Ohio Conference on Freight. But we've been talking about this bridge for what may seem to you like a few years now, and the promise of the bridge. And, you know, you may have heard some people say, it's a big bridge. But what's the big deal? What's the impact going to be?

And I think before you can really examine the impact of the new bridge, we need to think about the existing bridge. The Ambassador Bridge, and of course, there's also the tunnel to Windsor, which carries a lot less traffic, and of course, carries very little freight because of the clearance the the head clearance that it has. But the Ambassador Bridge, owned by one family, which is unusual, and this is our this is our number one land port to Canada. That bridge is owned by one family. And probably most importantly, both of its feet are in what are rather residential areas.

So not a lot of freight moves after evening hours. So what we at TMAC, we have advisory committees on all aspects of transportation, and our freight advisory committee has truck drivers on it. And they'll tell us that if the ambassador is backing up, their dispatchers will reroute them to Port Huron or reroute them to Buffalo, New York. So it's unlikely that you would build a warehouse Northwest Ohio or additional manufacturing in Northwest Ohio if your products are intended for the Canadian market, if you're unsure that you're going to get across that bridge in a timely manner. So that's what's so exciting, really.

That's kind of the story of this bridge is really its customs clearance. And that's why for the attendees of the conference, we were excited to be able to have them tour a 167 acres of customs area at at at the bridge. So I wanna go ahead and take you through this very brief presentation. I'll kind of go through quickly, and be happy to share this presentation with all of you, you may want to share it with others. And also the website for the bridge is fascinating.

You can watch a five minute video, it will mesmerize you of the building of the bridge. You can actually see like in time lapse, you can see the bridge being built. And so there's a lot of information there. But I think that really the customs area is is so much a part of the story. So let's go ahead and take a look.

First of all, it does create redundancy along the Windsor Detroit corridor, we will still have the Ambassador Bridge, and of course the improved border processing that I mentioned. It has a capacity for current and for future traffic, it has six lanes, but they can easily enlarge it to eight lanes, It was built with that capacity in mind. And it gives you highway to highway connectivity. Easy on from Ontario, and I'll show you a little bit more about that, and easy off on U. S.

Side. So this gives you a sense of just the project overview, The U. S. Port Of Entry, the Canadian port Of Entry, and the bridge connection between. And you can see just how large relatively those ports of entry are.

Over a 130 acres on the Canadian side, a 167 acres on The US side. And there is the bridge, this is a record breaking bridge, that's a mile and a half span, that's the largest free span bridge in North America. It's about, I think about 750 feet tall, that the feet are on land. There we go, yeah. And it has a multi use path, so they did a lot of community engagement, and it was very clear that people wanted to be able to get across there on a multi use path.

The nearest place that you can cross to Canada is Buffalo on Bikerfoot. And now we have this which is going to open up a lot of opportunity to connect pathways on the Canadian side and on The US side. And I'm getting ahead of myself, but I'm going to tell you that if you are on foot or on bike, you have your own customs lane, your own customs clearance area that you will be processed through if you go across. It looks exciting to cross on bike or foot, but it also looks a little daunting because you're really high up there. So there are three traffic lanes and a full width emergency lane in each direction, so eight lanes total, and they can accommodate oversized vehicles.

I want to tell you too that they can change these lanes. So they have overhead lights that will, know, they will show you like, it's green means you can go through those lanes, x means no, red x means no, so if there's more traffic coming from Canada or coming from The US, they can convert those lanes so that they can avoid backups. You know, if at a certain time of day there's more traffic going this way, then they're going to open up more lanes going this way, and more lanes going that way. That ability to convert all day long as the flow of traffic needs, that is phenomenal. So here is the Canadian port of entry, we did not tour this part, you know we couldn't even get on the bridge deck because even the workers who show up every day for work have to have passport.

They have to go through passport clearance now. Once the bridge connected, once the two parts being built on each side connected, from that point on the workers had to come to work every day with their passport. So obviously we didn't see the Canadian port of entry, but you can see it's huge. And there's some views here of their commercial processing areas, their inspection lobby. This is an important slide here, because this is one of the distinctives of the way they've handled processing on both sides.

You're not in, if you're in a passenger car, you're not in line behind a truck. There are lines for commercial traffic, passenger and bus traffic, and there's then the multi use path, all separate, all separately traveling and all separately being handled at customs. So this is a game changer. And they each have their own way through customs, they each are going to be processed through separate customs ports. So you can see the different color coding, the red, the blue and the yellow, and the yellow being your commercial, your freight traffic.

And here is what we toured, what everyone that was attending the conference toured, there is a building that two trucks can pass through, that is essentially a big x-ray machine. It can x-ray two trucks at a time. There are 36 main customs gates, and 26 subspecialty gates, then like secondary inspection. Hazardous materials goes here, livestock goes here, agricultural products goes here, and the other thing is that all of the special agencies that need to inspect certain products, which normally, they would have to go off-site to that agency's location, They are all on-site. So USDA is here.

All of the different agencies right there, cutting down so much time. Here's a secondary inspection lobby, And here again, you can see now, this is on The US side, how they're dividing the traffic up and how it flows. You can't really they were saying you can't really get misrouted, but you also there's a certain point where you can't really turn around either. So you need to know where you're going, but it's all so well, routed, that traffic traffic goes where it needs to go. So here's another part of the story.

They've taken the first 1.9 miles of Route 75, and they put a new interchange, and they've taken out any of the turns and twists that would be difficult for trucks and smoothed that all out, and made that just a straightaway coming off of the bridge. Same thing's been done on the Ontario side, so you're just like straight easy access for trucking, and I like to say as a Northwest Ohioan that they're going to be in Ohio before they know it, coming right down 75, but it is just a straight shot. There's no twists and turns and difficult truck maneuvers, it's just a straight shot. And they put in some really nice pedestrian bridges. Back to the issue of the community benefits too, they've, they met with the community, they have done so much to improve the immediate area around the bridge, they've put roofs on so many homes, they've enhanced so much of the area around the bridge, they really made a real effort and I want to point out that they did this on The US side, but this bridge is paid for entirely with Canadian dollars.

That's why you'll hear two numbers. You'll hear that it was 4 and a half billion and you'll hear that it was over 6,000,000,000, that's Canadian versus US dollars. So that's why you'll hear two numbers. So here you see the Route 40 the Highway 401 in Ontario, and you can see here the same thing. Traffic from the Gordie Howe International Bridge fully separated from local traffic.

So they're routing people right onto the bridge, not having them involved in the local traffic flow. This is interesting, because we had a speaker early in the morning who talked about the present state. Where is product coming from that's going across the ambassador? And you might think, oh well, Michigan, Indiana, Ohio, they, a significant percentage of product is coming from the Southwest, it's coming from our Southern states, from Florida, product comes all, from all over The United States and flows across this this border point. This is, this is our largest border point, and now with this bridge, this is going to be the preferred border point.

And so you can see that, the connectivity of roads bringing product all the way, you know, from all over the country. And of course, I don't need to tell this statistic, I'm sure that all of you tell this statistic as well, but from this very place where we're seated, draw 500 miles radius and you're reaching 60% of North America. And so obviously, we've always been a place where we can make things and move things, but this really enhances our ability to do business throughout North America. So all of the tolling happens on the Canadian side, that's understandable, they paid for the bridge. The rates are based on the axle of the vehicle class, the number of axles on the type of vehicle that it is, and you can pay in Canadian or U.

S. Dollars, you can pay in cash, you can pay by card, they have automatic, in other words like they aren't, they're in conversation with E ZPass, they're not yet taking E ZPass, they're in conversation, they have their own sort of version of an E ZPass. You can imagine a lot of the logistics companies and such will, will obviously sign up for that. But they also they do electronic toll collection, automatic toll collection, you can do prepaid, postpaid accounts, you can pay in cash. They're going to be completely bilingual because obviously there's so much French spoken in Canada.

And so they're going to do special passenger and commercial, know frequent travelers will be eligible for discounted rates and things that will help give them more efficiency. And so that's going to be something that they're going to be offering for those who are sort of frequent travelers. You can see this is something about their community impact that they did a lot of neighborhood infrastructure, they had a workforce development strategy where they involved people who live in the immediate vicinity of the bridge, so that they would benefit much as we did in the Overland project, the old Jeep location. It's really important that everyone benefits from something like this happening in their backyard. The multiuse path was something that came out of the community engagement, there was a lot of public art that was involved.

Then of course the local road improvements in the surrounding area because there will be additional truck traffic. The landscaping and aesthetics, I'll tell you the pedestrian bridges are really attractive. It's really, it's an amazing project. And when you see it, the scope of it is, it's really just kind of overwhelming when you see what an enormous project this is. And then they did a lot of sustainable features to it.

Everything from the LED lighting, facilities that were built in such a way that they take advantage of natural light, and the way that they tried to create things that used the least amount of water, and they have a peregrine falcon box, which is kind of a cool thing. They use drought tolerant native plants, so you can see that, oh there are several green roofs that they have used, so some very cool features. There you can get a view of what it'll be like to use, this is a rendering, but you can see what it will be like. It's a very safe, protected multi use path, but that is going to be really exciting tourist piece, think for people to be able to travel across the border. And so you can see here some of the trails.

We are, Timokog is involved with the Great Lakes Way and Great Lakes Waterfront Trail. So we're very excited to see how these trails start to develop on either side of the border. And we have a dedicated active transportation planner and he is very excited about the potential of this. So the economics of it, you are the finance committee. So this gives you some of the numbers here that you can see.

And I think you can see how much the Canadian and U. S. Cross border trade contributes to the gross domestic product of both countries and just how much the construction of this bridge has meant, has been remarkable. I mean, it's been 10,890 jobs in Ontario, 12,670 jobs in Michigan. It's been a massive project from 2018 to 2022.

So if you want to see more, this QR code will give you the updated process that's going on with the bridge. Originally, we've been hearing fall as the opening, I've seen some, you know, there's 2% of the bridge left to finish, but they keep saying it's a very complicated 2% because this is when the technology goes in, this is when the last few finishing pieces go in. So I think there's still great hope that they'll open in the fall, but still some unknowns. So I think we're very, very close. We're honing in on this.

There's a lot of product that moves across our borders, and of course right now it's a time of some unknowns with trade, but as the general counsel in Detroit, Canadian general counsel in Detroit, Colin Bird said, this is a 100 year bridge. This is, we're taking the long view on this, that this is going to be an incredibly meaningful economic project. And so we are very excited about it. I think that for Northwest Ohio to take great advantage of it, think the first thing is to raise awareness of it. I think that you can see that some folks are already starting to take advantage of it.

I mean I think you see truck amenities starting to proliferate because we think that a lot of those trucks are going to be coming through here. They're not going to stop in the Detroit area necessarily, they're going to make it through to Northwest Ohio. But beyond that, the opportunities for warehousing, the opportunities for increased manufacturing, I think are really really there for Northwest Ohio. So that's the presentation, I'd be happy to answer any other questions or hear your thoughts on this.

I'd like to add that President Hartman and Chief of Staff Frank were also with me when we toured the bridge. So we wanted to bring this to counsel so that everyone can see that this will have an enormous economic impact. Canada is one of our, if not the, one of the top three trading partners for The United States. So this, as Sandy has indicated, will have enormous implications, very positive. Council Vice Chair of the Committee, Driscoll.

Thank you, Mr. Chair. Thank you, Director Spank for your presentation. Can you go back one slide? I think it's slide number two. Yeah, that's the one. So this economic impact of the construction, correct? Any sense at all what the economic impact is going to be for Detroit, for Toledo, or is it sort of too soon to tell?

Yeah, so we had an economist from Boston, from SP Global come out and the plan was for him to try to do some projections of what kind of increase the bridge could mean for us. He gave historic information about how much trade is crossing and it's of course tremendous and what is it, you know, the historic present and some very modest projections for maybe the next year, like 1% to 2% increases. None of it really took the bridge into account because right now we're really in a very strange moment, right? We really don't know what the impact of tariffs will be, it's really hard, it's almost impossible to get anybody to give you any predictions. So they were not really willing to put any predictions forth.

A couple of years ago, when the bridge was just sort of in construction, I think we were seeing some predictions of what the impact might be and we aren't really able to get anybody to sort of give those predictions right now because it's really skewed by the present moment. What we do expect is they talk a lot right now about a leveling of the or redistribution. I think the reality is that it might take some time for adoption, but we're probably going to see some redistribution from Port Huron, some redistribution from Buffalo as the time efficiencies start to become very apparent. And so, even if there wasn't an increase in trade, even if we didn't have more trade with Canada, I think we're still benefit because when you're there and you see that the way that they have, I mean there's just so much innovation, the technology, just the intelligent way that they're approaching, the way that customs is being handled, and also just the way that they're going to be able to manage traffic. We think that there's going to be more redirection.

Now people are still going to cross at those other border or at those other crossings, but they talk about it being a balancing across the border. So we think that we're going to benefit even if there's not an increase in trade.

Yeah. It's a zero sum game relative to US Canadian relations, but at least as far as in so far as our region is concerned.

I think that's fair. I mean, I think that's just obvious. And I think when you're there, and I I mean, I guess I'm I'm looking at at Councilman Sorantu nodding his head, I think when you're there and you see that just the good design, the scale of this and just their ability to adapt to the products that are coming across, the flow of traffic is coming across, just know that we're going to gain some redistributions rebalancing of the amount of traffic that's coming across. What you hope is that we will also see some more manufacturing, some more warehousing, some more focus on our region just as a great hub because it's how easy it is if you are moving product across the border to have some stationing here. But I think it's really difficult to quantify that and I think that we need to take a longer view because in the short term we have this instability.

But I think if we take the longer view, I think we know that we're a great location for warehousing, we know that we're a great location for manufacturing and we also heard at the conference from Lorenzo Gonsalves who has 12 locations of Cleveland Cliffs, know, the President and Chairman of the Board and CEO of Cleveland Cliffs. He is a great believer that we're going to see more and he's certainly made the decision that Ohio is where he wants to be with 12 locations of Cleveland Cliffs here. You know, it's interesting, many people don't realize that since Cleveland Cliffs located in Toledo, that location is responsible for 100 additional ships coming into the Port Of Toledo every year. And, I don't think I served on City Council when announced they were building and began to build here, and I don't think anybody realized that that would result in that. Think about how many more jobs at the Port Of Toledo, that meant 100 additional ships.

And so, I don't I don't want to oversell, like I don't know, I don't have hard numbers But for I think that when you see something like this happening so close to our border, no investment on our part, but so close to us and coming right down Route 75. I think that we need to be aware, we need to think about ways that we can benefit in Northwest Ohio. And the key ways are truck amenities, truck parking still remains an issue, it's being addressed, but truck parking is still an issue. Truck amenities, warehousing and manufacturing. I think those things, I think we need to be aware that those are the needs.

And so, think it's awareness is the first step and being open to opportunities, but I think it really is hard to put numbers on this right now, partly because the uncertainty we and I don't think this is going to I don't think they're going to open the gates and it's going to happen immediately, I think it's going to take some time for the adoption to take place, right? I think it's, there's going to be sort of a testing period of how much time is saved and what's this, you know, but I think anybody who has seen it has got to say it looks like a tremendous advantage and it comes right down to us. So I'm very excited. This is certainly going to mean additional traffic coming through Ohio. And then if you also look at what's happening at the other end of our state, the Brent Spence Bridge is being built in Cincinnati, and that's a bridge that's been twenty five years planning.

I have learned something, after the fast pace of of city government, I have learned transportation planning requires a great deal of patience. And, the Brent Spence Bridge, twenty five years of planning and of need for that bridge, but that's going to be that's going to open up a lot more traffic going through there because they've needed that bridge for a long time. So, it's going to mean that traveling through Ohio is going to be smooth sailing for freight. So, I think it's just knowing this, and I think that having this body understand that this opportunity, freight, we are unmatched in our multi modal capability. We had we had a speaker, a young woman who has is the founder of an airline, a freight airline at Toledo Express.

Our regional airports are moving freight and Toledo Express is moving more freight than ever. Grande Air, Tron, Interjet West, her company. We have one of the busiest rail corridors in the country. We are at the crossroads of the longest East West North South highways in the country. And, we have a port that is busier all the time.

We, we are truly at this, in this wonderful multi modal spot, and so freight is our strength. And so I think that that awareness that that is you know, that is really where we can excel. I think it's just really important. So, I think where everything will go in the future, I think that's exciting to see, but I think that awareness is where we begin and looking for opportunities to maximize on the opportunity.

So maybe it remains to be unseen on the economic impact side, what about on the like transportation planning side, any indication of what this is going to mean for traffic counts relative to our the major highways that run through Toledo 8090, 75 and 475?

Yeah, I mean, I think there's potential for more traffic on 75. I can tell you that we are more resolved than ever that the bypass between Route 23 and Route 70 for Columbus is more critical than ever. And I want you to know that we had representatives from Ohio Department of Transportation as well as our peer organization, the Mid Ohio Regional Plan Commission, our peer in Columbus were in attendance at the bridge visit. And we've made more progress this past year on the bypass than we've made in many years. There was, as many of you may know, there was an item in the state transportation budget to not come not do a study, but to make a plan to choose a route for the bypass.

By October, we'll have a route and I'd be happy to come back and report on what that selected route will be, and then within an additional year, we'll have full engineering drawings. Now we won't have a funded route, and the question will it be a will it be a toll route, will we be able to find federal funding, how will we how will we build this route, But the first step is to have the is to have a selected route and to have engineered drawings for it. And again, it's going to take a lot of community meetings and involvement because obviously we're going to be needing the land for that route, but we now know that we can't have this opportunity that this bridge represents, have additional freight traffic coming through and then have it just blocked from the twelfth largest market in the country and one of the fastest growing markets in the country, we can't say, oh, but boom, you can't, you know, there's no efficient way to get to our state capital. So it just makes that case so much stronger that we need that bypass. So it's so timely that we are finally now making progress, and I was so glad that the very organizations and individuals that we needed to have there to see the potential of the Gordie Howe Bridge could also think to themselves, do we want this not to make it, do we want this additional activity not to be able to make it to the state capital.

So that I think was a big win for us that they were there and they could see that. So I think that's my number one goal as far as transportation planning is that's our we can see that that disconnect is number one for us.

Yeah. By all accounts, I wasn't able to attend. All accounts, great conference. Thanks for hosting it. And I agree, It's utter madness that there isn't a connection between us and Columbus to begin with. But, yeah, getting in touch with our second or third largest trade partner to the really the only growing market in Ohio, the Columbus MSA, it highlights that even more. Thanks for the presentation, thanks for coming today

and You're very welcome. Appreciate your work on I appreciate the time.

Thank you Vice Chair, Consulperson Gaddis.

Thank you Chair, and thank you for this. This is really exciting. I had a question about the expansion of AI, vehicles And when they built this, were they anticipating the inevitable march to AI vehicles as they developed

truck routes? So we did have a presentation from Drive Ohio and EASE Logistics because people are saying pretty soon there are gonna be autonomous trucks on the roads. They're actually on the road right now. There is a pilot project on the roads right now, and they showed video of that. It's being done the model is platooning. So there is the first truck has a driver and then the following trucks are autonomous behind it, right? So that model is actually being tested. And the bridge authority has explained to

us that

they have built into this model the ability to upgrade technology as technology changes because they're aware that this is a moment where we are seeing technology just changing so so rapidly. And you can see that when you the reason it's a 167 acres of customs clearance, it's not tight. It's very open, the the curves are large, and I have to think that they've made plans for, I mean, of all, they've separated the different types of vehicles, but I think they've also that, you know, my conversations with them is that they are prepared to upgrade the technology as technology changes. That's almost word for word the way they described it to me. So I think that as we see these changes in trucking and we know that, you know, one of the things that's pushing it is workforce.

We hold a transportation summit every year and we had there's a research facility in Columbus that does a lot of autonomous testing and one of the questions that was asked was where will we see autonomous vehicles adopted first? And the answer was, it'll be in the commercial corridors and its workforce that drives it. And so one of the things that we saw in the presentation at the conference this past week was that, you know, there are less crashes, there are, you know, the safety numbers look great compared to, mean the reaction times are faster than our reaction times, I hate to admit it, but they are, you know, than human reaction times. But there's still a long way to go. And so these things are still, you know, in the sort of prototype and testing mode, but things are moving quickly.

We also saw speaking of AI, we had presentations from some of our regional airports and the Fulton County Airport was talking about using AI in conjunction with drones. They're doing crop dusting and other things and they're using AI with drone flights that they're doing. So we're seeing it come into transportation, there's absolutely no question. But I do feel very confident that the Bridge Authority made plans for technology upgrades and then, you know, it's I think that part is true, but it's a great question because we know that that's going to be more and more important and as transportation adopts more of this new technology. Absolutely.

Thank you. Yeah. Thank you, Jerry.

Thank you, Councilperson. And I would just add that you know, again, economic impact is going to be challenge to evaluate, but I think that our region is positioned with I-seventy 5 and Interstate 80 to really gain from this. And the other thing is, obviously, the route to Columbus. Council's been very supportive of lobbying for that effort because we understand, you know, with 38 traffic lights, it just makes it almost impossible to get down to Columbus in a timely fashion, and that will affect the movement of freight, which is very, very important. So we really appreciate is there any other questions for Sandy?

So we really appreciate your presence here, and this has been excellent. Councilman Hobbs.

Just thank you for being here, Sandy. As always, thorough, as you always have been in our with the economic uncertainty. You talked about the building of warehouses and different things that could benefit from this bridge. How long do you think we're gonna have to wait before Toledo will be able to tell whether we start doing these things to make us more of a I mean, we already with being a port city as we are, how do you think it's going to take five years, ten years before we'll know what type of investment we make as a city for this flow that we're expecting to come from this bridge? Or is there any projections for that at all?

It's really hard to know between, there are just so many factors, know, you have the private sector making their own decisions about investment and you have the current tariff situation, I think that we will see within, I'm sure within a year of the opening of the bridge, we're going to see the additional freight traffic coming through. I don't think there's any question about that because I think the advantages of the customs clearance, the advantages of the efficiency of time, think we're going to see that quickly. Whether how long that will take for private sector investment then to follow, again, I wasn't able to find anybody who would come to the conference and give hard projections. And so if the experts wouldn't come, I surely can't make those projections. But I think that we have to take the longer view here.

I think we have to know that we have to have a, I think we have to look at the advantages that we have and take the long view in these things. We have seen, I think Cleveland Cliffs is a great example. That's 100 additional ships into our port, and then that's bringing the ore in. Then when they, that's bringing the ore pellets, then they finish those briquettes and they send most of that out either on trucks or on rail. Just think about all of those jobs that and that's been about about a ten year from construction commencing to where we are today.

And, that's that's a tremendous story of success. They've also been great environmental stewards. They did the Duck Creek project, know, there it's a one project can do that. It's really hard to predict, I think the key is readiness as a community. Know, we can't predict what the private sector will do, we can't predict how many trucks are going to come across that bridge, but we can be ready as a community.

And I think that's all that we can do. We can and I know that Director Sellhorst is always looking to prepare sites, to clean up brownfields, to be ready to market at the sites that we have, having our workforce ready. I think we just need as a community to be prepared and ready for investment. I think that's all that we can do, and then other factors that we can't control, I think we can't control them, but we can be ready as a community when we see that there's something that offers an advantage, something like this bridge construction. I think that's all we can do.

Do you I mean, with all the vast experience you have, you've sat here looking out different plans, other cities you've gone to and, have dealt around the surroundings bridge. Does Toledo can we really compete? Do you feel like we're really strong to compete with cities like Cleveland, Detroit, Chicago? Are we a city that can really compete for the business, for whatever might come from this? Do you feel that that's something we really can get done?

You know, Toledo has a wonderful history. And we, at one time, we had seven Fortune 500 companies, we have a wonderful history. And in the life of a city, you know, we're still a young city, you know, and I think we have a great future. The our keynote speaker I've mentioned, Lorenzo Gonzales, someone asked almost the same question, and his response was, we have water, we have a great workforce, we have a great future. And so, again, I think we just need to, you know, be ready and work hard and maximize our benefits.

Optimist, and so I believe in this city and I believe in our region. And so I think that we are the some strength of our region, and so I think that we as a region have that strength, yes, to rise together as a region, all of Northwest Ohio, and I think that we can be very successful in the future, because we do have these assets. We have this infrastructure, this freight infrastructure, we have abundant water, and we have a great workforce. So I I do believe that. That's a personal opinion, but I certainly do.

Thank you so much. Thank you, chair.

Thank you, councilman Hobbs. And I just wanna add to that that the CEO of Cleveland Cliffs, in his remarks, was absolutely positive about the working relationship Cleveland Cliffs and he had with the city of Toledo in economic development. He could not have said it better. He was so complimentary about the fact that the city was so easy to work with and getting his plant here. And I just I wanted to pass that along because I thought that was one of the most important things he said besides what he was predicting about the future.

That's true. And he he said that Ohio was not the first choice he had for that facility. But working with Ohio, with Jobs Ohio, with the state government at the time, and with the city of Toledo, made it such a positive experience, he couldn't say enough positive things, and we often don't realize that that is a world class facility. It is the only facility of its type, it is a very green facility, and the kind of product that it makes, a, it's the only facility that makes that particular type of steel product. And he couldn't say enough good things about working with us, and so that was a really, that was great to have so many people from really eight states Mhmm.

And the District Of Columbia, from Canada, and all there, and have him say tremendous things about working with Ohio and working with our city. So, that was really terrific to have him there. So yeah, we came away from the conference feeling very positive about Ohio's future, about our region's future, and I would certainly say that I think you should feel very hopeful about Toledo's future.

You very My

pleasure.

We appreciate you being here and opening up our eyes about the tremendous Gordie Howe Bridge, which will be open very, very soon. Gordie lived in Sylvania with his son who was a physician and he's just a real positive person and they told us that when they called him to ask permission if they could name the bridge, he said, of course.

And he was important to Canada and important to Yes. To Detroit, to The US, played in Detroit, but obviously Canada, proud of him as their one of their great sons, great hockey players, so he was the perfect representative for some a bridge that spanned both countries. So they thought that was a perfect fitting name, and yes, he thought that was just fine if they wanted to name it after him, so it was a good story. But thank you again, Mary has this presentation, so I hope she'll share that with everyone, and perhaps you can share it with your constituents, because I think, again, I think if everyone just understands the potential of this, we'll be poised to take the greatest advantage of it. So it was wonderful to be able to be here with you all today.

Thank you so much for your time.

Well, thank you very much. Next, we'll have the finance department do a presentation on the June financials and then after that we'll have the city auditor present his presentation. Good afternoon, director.

Good afternoon, chairman Sorantu, members of the committee. I'm happy to be here today to present the June financial reports. I'm joined by commissioner Zavisha, Commissioner Buckley in the audience. We do have Commissioner Dan Mori as well as our Interim Purchasing Commissioner Natalie Bronagh. Hopefully everyone has a copy of the June packet. And to dive right in, I'll turn it over to Commissioner Zavisha to give an update on tax.

Okay. Commissioner, good afternoon.

Good afternoon. I'll be starting on the second page of the report, for City of Toledo income tax collections year to date '24 versus '25. Overall for the month of June, the City of Toledo was up just about $240,000 ahead of last year's pace. So of the $22,961,000 collected a little bit of growth not a lot there just about 1%. The withholding category which makes up just shy of 78% of what we collect so far this year was just barely up $43,857 or 0.3%.

For the year the withholding category is still trailing. This is really giving us five complete months because during the month of June you'd be making your May payment to the City of Toledo by June 15 if you were a monthly withholders. So we are trailing a little bit behind. So sort of like we've talked about in prior months, we were sort of running these last few years of always being up 3%, 4%. This year this is becoming a little more of a trend.

Like I said, when we were watching it earlier in the year, we were just sort of seeing what's happening, but this sort of seems to be where the withholding category is sort of heading right now. When it comes to the business and individual net profits, the month of June is the second quarter estimate is made. So for the business category, we were up just over $200,000 or 4.4% for the month. For the year, we're still very strong in this category up $3,800,000 or 28%. But again as I've mentioned before the business net profit is one we really have to watch.

It's the one category that is very driven by estimate payments. For example, so far in 2025 of that $17,300,000 that's come in just over $11,000,000 of that or just shy of 65% of that is estimate payments. So it's companies like I said making that payment for that tax return that actually won't come to the following year. The other thing we have to really watch in this category, this is driven by a very small amount of companies. For example, of the $17.3 collected so far this year, just shy of 39% of that is simply three companies, three very large companies in the city.

But when you're starting to see, for example, the month of May where you'll have a big jump, when it is usually one of these big three making a payment and then it's us comparing it to see on a year to year basis where did last year they make it in August and this year they made it in June and stuff. So we're always sort of watching that as well. But again business net profit has been really strong to help us overcome withholding being pretty flat. The individual category which makes up just less than 7% of our total collections, just down slightly less than $10,000 For the year it is still very strong just shy of 350,000 or up 5%. So again with those second quarter estimates coming in that's a nice flat number on that.

But I mean it's still holding the overall yearly number of being up 5%. So overall at the June, we're up just shy of $4,000,000 really $3,770,000 or 3.6%. And then just to carry over to the next page just real quick, projection wise that's putting us about where we figured we would be. Right now we're projecting in the year at $231,600,000 The budget number was 231,300,000.0 So staying pretty good with that number. And then real quick for the refunds through the June, we've issued $1,800,000 At the same time last year, had issued $2,000,000 By the end of the year, we would have issued $5,600,000 So pretty similar pace to last year on the amount of refunds going out the door.

And if anyone has any questions on either of these two pages, I'd be glad to answer.

Seeing none, proceed.

Continuing on to the next page, you see the general fund revenue compared to budget through June. Overall revenue collections are at 44% of the budget estimate. We're at 41 at the same point last year. No major changes from what we've been reporting the past couple months. As you look through the report you'll see we're on track with property taxes.

Our license and permit category overall is at 54%. Within there the group A and group B licenses are down a little bit but some of those license renewals happen in the second half of the year. So nothing that we're concerned with in terms of that budget estimate. Overall our intergovernmental revenues are at 37%. Within this category we do have our quarterly casino revenue payment.

We'll expect to see that for the second quarter probably in September if not early October. Charges for services have been strong the past couple months as we've talked about the ALS and EMS billing revenue has been coming in running a little bit ahead of our estimate and the category overall is at 57%. Investment earnings at 34%. This again is an area where we expect to see those increase in the second half of the year. No concern right now with our budget estimate there.

Within other revenue category, you see that we're at 114 percent. This category does include money came in through a settlement for PFAS litigation the council approved earlier this year. And then overall in the other financing sources you'll see our budgeted transfer from CIP which will make it year end and then transfers in the other category come in from both the tow lot and ARPA interest earnings. I'd be happy to take any questions if you have them.

All right, Vice Chair Driscoll.

Thank you, Chair. We did do a full capital transfer last year.

We did, yes.

And is it premature to suggest that we're on pace to do the same this year or? Certainly budgeted for, but based on

what

you're

seeing Yes, in planning and projections, we're anticipating the $24,000,000 Okay, this year

thank you. Thank you. Anyone else? Okay, next.

Our general fund expenditures are on the next couple of pages. First, a summary by category and behind that a summary by cost center. Like last month you'll see starting at the top of the report the labor expenditures are running ahead of budget on a year to date basis. This is the result of the collective bargaining agreement for police that was approved earlier this year and retroactive to April. We did introduce yesterday I think it was at council the mid year budget amendment which addresses amending the budget to cover that as well as police command and local 92.

The timing of when that amendment would pass will drive when we'll amend the budget. I expect that by our September report you'll see that increase in the budget and that year to date variance will have gone away. Overtime expenditures are trending as they have been under budget on a year to date basis continuing to reflect positive news there. We are continuing to watch in the employment tax and medical category our healthcare expenditures driven largely by prescription drug costs. That's one that as we head towards year end we'll be evaluating that and seeing if we do need to do any final budget amendments.

And then in the non labor category services just want to mention at 52% we did already make the third quarter regional council of governments payment. It's made at the start of the quarter so that's really what's driving the variance in that category. I'd be happy to take any questions.

Well, I think it's important that our overtime is below budget significantly, 1,100,000.0 and that is important. The negotiations for the new contract after this year, what when is the police department contract patrolman and command and fire local ninety two?

When does that begin again? When they they would start exactly, don't know. But the contract that was just approved covered '24, '25, and '26. Right. So it's probably during

Sometime in '26 And negotiations will I'm sure I speak for all counsel that we hope negotiations start and that they end in a timely fashion and that we don't have the situation where the contracts took so long to approve and here we are and we're almost ready to start negotiations again. So I hope that the administration and the labor unions can get together and work together and get a contract that's approved in a timely fashion so we're not almost at the end here like we have been. So I appreciate that. I know the finance department doesn't have anything to do with that, but I did want to make that statement that I think it's important that we get moving and reach a contract in a timely manner, not that it would take a year and a half or two years to consummate. Anything else?

Not with this packet. If you have any questions on the breakdown by cost center or our all funds revenue and expenditure reports, we'd be happy to take them. I also just want to mention a few things with regards to our ARPA report. We did provide our one page summary of the Toledo recovery plan with spending showing that there's about $31,000,000 remaining to spend by the end of the period at 2026, the 2026. We did have a reporting deadline this past the July with our quarterly report as well as our annual ARPA report.

So we've met that reporting deadline and submitted those reports to the U. S. Treasury. The ARPA report is posted on the city's website as

well. Okay.

And be happy to take any questions.

All right. And we have not heard back yet from the state of Ohio, the auditor's office, but I assume that sometime in the near future, Commissioner?

Yeah, I think if it I can jump in. If it follows the same pattern as last year, it was submitted by our auditors to the state and then released by the state late August or early September.

Okay, okay. We welcome that. Vice Chair Driscoll.

Thank you, Chair. Do we have an explanation from public service? The expenditures, 74%, is that they do more mowing and tear downs in the summertime when the weather is warm, is that?

That's exactly what it is, Councilman Driscoll. Couple of things there, one is mowing and play operations. So when the season starts in late spring, early summer, they do encumber all those dollars for contracts that run throughout the entire season. And that's really what's driving that variance.

It's lower than it was last year, suppose this time last

year. Yes.

Thank you.

Okay. Thank you, councilman. Alright. Thank you very much.

Thank you.

And we will proceed now to the city auditor's report. Good afternoon.

Good afternoon. John Rybalsky, city auditor. Today on the agenda at the last finance meeting, we discussed the city auditor's twenty twenty five, twenty twenty six internal audit plan spanning 07/01/2025 to 06/30/2026. I do have a handout of that that I'll pass out. But as we have a quorum today, I'd like to ask that we adopt that today.

And this audit plan has, as I said, we discussed it last finance meeting and I sent an email out to all of counsel with the audit plan and I'd be happy to go through an overview of it, or if you have any specific questions, I'd be happy to answer those as I

think that would be good if you could just do an overview, Mr. Auditor.

Sure. So, this is for the internal audit plan for twenty twenty five-twenty twenty six, as I mentioned. You'll see here that there I list the number of audits, the topic, the preliminary objectives, the timing and the hours for each of the three audits on the plan. The first item is a city grass cutting program audit. This one looks at the objectives, does the city's monitoring of vendors ensure workers perform to agree upon scope and does the city use its complaint management system effectively?

So, this is focused on are the vendors performing according to their contracts. And then the second one is an asset management focus, and this is looking at physical assets and was one of the audits that was on the 2024 audit plan that's being moved to this audit plan. And the third one is a cash and receipt handling audit. And this is looking at controls around petty cash at smaller operations. And then for these three audits, in addition, there's other activities that I do in my office that I have planned these audits around.

That includes the biannual review of investments twice per year, budget recommendations, ad hoc city council reporting and support, advisory committee meetings such as to review the external audit, following up on prior audit recommendations and then other projects. And with that, please let me know if you have any questions.

Vice Chair Driscoll.

Thank you, Chair. Thank you, Auditor Rivovsky. The only question I have is, there you have three main topics here. If it happens to be the case that something comes up that we think will need to be audited, is there room in your schedule to do that to dedicate a large chunk of time to if there's a project that we think needs to be if we need to amend this plan?

Great question. So the plan is made such that I have time for special counsel activities. So if it's a smaller scale item, I can definitely look into that. But this plan is we're able to amend it as we go if priorities shift. So it's definitely possible to bring something in and move things around.

Okay, terrific. Thank you. Sure.

Thank you. Councilperson Gaddis.

Thanks, chair. I just want to thank you for choosing the city grass cutting program to audit. I'm really excited. I think it's such an important part to our citizens and to an impact on our budget and I'm just really stoked about it. So I just wanna thank you ahead of time for that. Thank you, chair.

Thank you, council person. And I would add that we appreciate the auditors emphasis every agenda review we get that financial data from you that basically indicates where the money is going to come from, what impact that has on the overall budget. Obviously, I'm sure you're reviewing the midyear budget adjustments from the administration, but that's very, very important and the ongoing audits that need to be done. So we look forward to this and any other suggestions you've got from time to time, please let us know because again, the role of the auditor is to provide to counsel the information that we get that is coming from an independent source and that's what the city auditor was designated when the changes were made in charter that we needed to have an independent auditor reporting to counsel all the financial information that there is and any relevant changes and modifications that need to occur. So we appreciate that.

Anything else? Is there any other business from council members? If not, is there anyone in the audience that would care to address the finance committee? Seeing no other business, we stand adjourned. I'm sorry, I did not Vice Chair Driscoll, you had something?

Do do we need to

I don't have a quorum.

Oh, we do not have

a I'm sorry.

I thought we

had half of

the alright. Sorry.

We did, but unfortunately, we don't. But at the next meeting, we can do that. Thank you for the reminder, and thank you all for attending.