Finance Committee - Regular Meeting

business. Is everything okay? Good evening. No more side conversations, please. Uh, this is the finance committee meeting for May 27th, 6 PM. Um, I'm Chairman Jeff Sassy and with me I have my uh other finance uh committee members. Um, Mark Vgo, ward one, Mark Evans, W six, and then you want to go around the table, please? Yeah. Tamara Ingresol, finance director. Mayor Jamie Clary. Jesse Act, chief of operations. Scotty Bush, fire chief. Terry Goodwin, alderman, w economic development. Andy Gilly, parks director. Karen Dixon, alderman, ward four. Welcome all. Thanks for joining us today. Uh, first order of business is the acceptance of the agenda. So move. Second. Uh, any changes to the agenda? No. All those in favor? I. That passes unanimously. Next, we have the minutes for May 13th. Second. All right. Any changes that you've seen? No. All right. All those in favor? I. That's uh unanimous. No one signed up for public comments. And so here's our one agenda item. We have ordinance 202511, an ordinance amending budget ordinance 202408 to appropriate funds for insurance claims and other adjustments to the city's fiscal year budget. Mary Clay, did you want to speak on that? Sure. Uh so typically we get this part of year um usually April or May, we end up with sort of a final uh or close to final budget adjustment uh amen amendment. Uh this year uh something unique happened and that was that we had damage to a fire just gosh

eight days ago. Uh so uh there's even more of a reason to to have this. You'll see a couple other items that we need to adjust. Uh all under operational cost and all are covered uh so that we don't have we don't have any in we don't have any need for increased funding from the general. Okay. Any questions on that? seemed pretty straightforward to me. I was looking at over Yeah. Um so if there's no questions, are we ready to vote on that? Sure. Sure. Right. Can I add one more thing? Yes. Um I would appreciate if your motion if you if you decide to um recommend this that also include that you won't would like to see it on the agenda tonight. Yeah. Problem with that. All right. Someone want to make a motion and motion may approve. reading uh ordinance 2025-11 and and add add it to tonight's agenda. All right, I'll second. All right, all those in favor I that is unanimous. Thank you, ma'am. All right. And uh Tamara, it is your show. The the first report in the packet in front of you is the sales tax report for our local auction sales tax. We are did come in for the month of April just slightly over April of the prior year. Um overall for the um budget year we're about 5% of over the prior year. Um at this point in the year we are coming in estimated to come in below what is budgeted that includes the budgets um the amendment that happened in mid year um we were preparing midyear budget in January but we received the January funds in February that was well

below what we were anticipating from the prior year and then we've also for the month of March was was below the prior year. So, we're coming in a little bit below, right around 22 million even um on that one. So, it's one to keep an eye on. We do have 22 million budgeted in there for next fiscal year. Um so, budgeting it at a flat rate compared to where we anticipate ending this year. And this this budget here, remind me, did we do anything at mid year to adjust any of this up? We did, didn't we? Yes, we did. And so, the 183 represents that. Now the 183 is our collections year to date. The 222 is our current budget. That's the budget as it stands today. As it stands and so would we need to make would be the equal I guess we have we have roughly 800. Well that's over last year but 870 is what change between the two years. What will we need to have these two months to make us equal to budget? I guess is what I'm asking. About 1.2 million. Um, we Yeah, we're going to have to be more in May and June to even meet the budget of 22. We're going to be about a half a million short if you if you come in. I'm sorry, not budget, but what is budget compared in these two months? Do you know? I I don't remember. Okay, never mind. That's all right. Yeah, I think if we come in slightly over prior year for last year, then we'll be okay. We're going to end up we're still going to be probably 200,000 under what was budgeted. Um, and then that'll be offset by some expenditures that were budgeted at our That's kind. Do we have expenditures that are going to be under spend? Absolutely. Okay.

Okay. Any other questions on that? Great. Uh, state share sales tax. Yeah, state share sales tax um very similar um as in what's happening with that one um as the local option. The difference is the state shift um we're only just over about two and a quarter% over the prior year. Um our local taxes are coming in stronger than the statewide taxes are. Um you know we're at this point in time um about 40 just over 40,000 under budget. Um if May and June come in a little bit over what was we were the prior year, we'll be pretty close to the target on that one for for meeting what we what we had led with it. So correct me if I'm wrong. The way I'm reading that is the city is five currently 5% over last year. Yes. While the state share is 2.25 over last year. That means Hendersonville is is seeing a larger increase in sales tax and um people shopping here. Yes. Than in other uh municipalities in our state state. Almost double the current inflation rate. So we're we're actually getting somewhere with these and not just changing numbers. Yeah. Good. Yeah. So, I mean, I I'm trying to find the silver lining in this. I mean, Hendersonville's economy is stronger than than statewide, but it's also looks to be plateauing a little bit. It's leveling out. Well, I would imagine the rest of the state's probably seen the same thing. Yeah, absolutely. Um, so time will tell. Yes, we are plateauing. Things are are leveling out. We've seen a lot of positive growth in the city, but um significant significant growth over the last few years. Yeah. Okay. Any other questions on that? Okay, let's move on.

Hotel Motel. Um that one is this last month. Um actually the last two months have been the strongest months um all year long. it has picked up a little bit which is um you know a good thing but overall you know the the the amount of hotel the number of night stays are not where they were and where we were hoping that they would be um you know hopefully that continues over the you know May and June that trend but we're trending a little bit below what we had budgeted um on the hotel tax as well. Do can you tell me when we instituted the new hotel motel tax fee? It was went into effect in August of 203. August of 23. Okay. So we're or 24 22 22 August of 20 21 no the the 4% was 23 new the new Yeah. Yeah. So it was it was 2023 year and a half right. Okay. And before that it was 2.75. Is that right? Yes. Okay. Um, so I mean I'm that's about flat then um for for at least last month. What are the Go ahead. Sorry. Go ahead, folks. Oh, I was just going to ask if um I keep I asked this some time and I know it's hard for you to tell, but uh do have you been able to find any reason for the drop in in in the hotel? It's I mean it's the same kind of philosophy as to why our sales tax revenue was lower over the Christmas shopping that fund spending for vacations. People just aren't taking weekl long vacations. is they're taking maybe add two days to a weekend and

taking a 4-day vacation or um so they're just they're on their extras they've cut back because inflation has gone up um so much. The same reason why we didn't see the big sp as big of a spike in our sales tax over the holidays. Um you know when when you have to choose between you know buying your groceries or taking a weekl long vacation people are saying well let's just do a long weekend instead. And even those that are coming in for events at our parks, they're choosing to possibly not stay as long as they were previously, too. So, does this number accurately reflect the occupancy rate or what is their occupancy rate? Is it on your form? What do you mean by the occupancy? Occupancy number of beds are full. Oh, no. I don't Yeah, I don't have um we don't draft that in. I kind of two questions there. Number one, it's not on the form. Number two, it's not reflecting of the occupancy rate. Is that correct? I mean, there's some correlation, but the occupancy tax is based on the fee. So, as the fees go up and down, that that amount goes up and down. So, they could if they charge a higher fee but have less rent, less occupancy. We could still collect, you know, as much, but we don't we don't track the occupancy rate on it. Ideally, they would want to be full. Correct. Ideally, ideally. Okay. So, so rates would fluctuate. Fluctuates what market would bear, right? Yeah. And then there are some um that may be full but they do more extended stays and so once somebody stays over 30 days then they don't pay occupancy tax. So there are exemptions of having to pay those taxes as well that come into play in some instances. I think there's only one in town that does that. Is that correct or is there another? Um there's one that does it significantly and then there's another that we um there's we see that

occasionally on others but not not not regularly. Okay. All right. All right. Thank you. I'm sorry. No, thank you. Those are great questions. Anything else? Okay. Let's move on to the interest investment revenues now. And you'll see the um investment income is still um coming in relatively strong. However, it is not as strong as the prior year. Uh you if you look at April for last year compared to this year, it's about $10,000 less in the current year than it was the last year. the interest rates have dropped um about a percentage point for our um LGIP investment for the pinnacle. it's you know dropped over a percentage and that plays you know that plays into that we are still you know trending to be aboutundred and you know who is that looking to be we have budgeted 1.1 million we're projected to be over over budget by about 500,000 on that but it is you know trending you know each month the interest rate is dropping a little bit we anticipate that's going to continue to do so over the next few months So, remind me what we currently have budgeted for that in our in our upcoming budget. I'd have I'd have to look it. I I can look it up. I don't remember. I don't remember because we had looked at a couple of different um It's significantly drop. It It is. I I don't remember what the amount was that we It was right around 1.1, which is I think we budgeted right around the same amount. Maybe a little bit of an increase. Yeah, we budgeted. We budgeted a reduction for next year, but I don't remember what that dollar I don't remember what that dollar was without looking it up. It's over a million. It would be on one of the budget books, one of the first one

of 850. I don't want I must mix up my numbers, but that's because it that's because we're using more of the Yeah. Yeah. the fund balance. Yeah. So, we're anticipating the interest rates to continue to come down. Plus, we're budgeting to spend a lot of the unassigned fund balance. So, they're going to have less money to invest. So, a combination of those two things for next year, but comparable 24 to 25, we're talking about the same investment dollars for the most part. Very, very similar. Yes. So, it's truly just based on the investment grade. Okay. Yeah. Yeah. The investment rates been about a percent less for most months this year. Yeah. And we can see that trending downward. The LGIP is still every single month just a little bit less. I know. Yep. This keeps dropping. All right. Next, we have storm water. Storm water is very consistent this year compared to the prior year or end of year. We will end up collecting a little bit more money this year than we did last year, which makes sense. We have a few little bit, you know, an increase in properties um that have come on on the tax roll that we that we build. Um the revenues are coming in real real steady. Um I expect to see, you know, May looking good as well on there. And then our expenditures um are as well are doing we're we're really right where where we anticipated being with with floor water. That is funny. I know. I'm just going to go ahead and ask this. There's last year in May there was a significant decrease. Can you guys remember what happened at that point? Was there It's It was just um the timing on on when people come in to pay their taxes. There's just something simple as that. Nothing. Okay, good. Yeah, we send out I'm sure I've

heard it before. We send out the delinquent notices in April and so everybody gets an end. They either get them in in April or they have to save their money for a couple months and then they come in in June. Okay. Well, that's interesting. To your point, do we know why 23 was higher than 24? Because in those first few months of 25, we didn't see additional Yeah. funds come in, which would be those delinquent ones you would think would come in, but we saw a reduction. Yeah. Just trying to figure out what happened last year. Yeah. Can't remember. Yeah. I can I I could go back and I can kind of decide nobody's thinking about this year, but do we do we suspect this year will be close to I'm sorry, this May will be close to April or what is our projection? Um I'd have to I'd have to look at it. I was looking at it about a week and a half ago and we we were at right about what last year's was about halfway through this month. So we'll we'll have some more. Okay. Although the last week and a half or so we've had almost nobody coming in to pay. So, it's been really quiet. You're about to get your taxes in. It's been very quiet. Next PIP. All right. This is a two-page report. The first page summarizes the revenues um so far um year to date. Right now, we're um projecting to come in a little over 200,000 over what was um budgeted. Um, and then that money can be, you know, I don't, it's pretty close to what was estimated for year end when I wrote the budget together. And we're anticipating utilizing any any unspent funds this year or are budgeted in next year's budget. Uh, and then the bottom is a summary of our actual expenditures year to date. Um, so ending that pending balance, the 4.4 4 million. That's literally just the revenues less the

money that's gone out the door that we've spent. We do have incumbrances like we have a fire truck that we've that has been ordered that's2 $2 million that comes off of that 4.4 million. Um these are this is just showing what the revenues less the expenditures are as a snapshot in time of how much money is sitting in the bank. some of it's been obligated other. Um and then the second page of this is a summary. Um up at the top it shows a summary of the budget by all of the different um the four categories as well as the revenue. And then down here um the bottom part is the breakdown of all of the different expenditures that we've had for PIT so far. Um the first column shows what what is budgeted to be spent out of this fund and then we have our actual expenditures, the status of the project and on the right hand side those are purchase orders that have been issued. Um so funds that we've obligated for specific items already question. Yes. Uh, I thought I saw recently, Scott, Chief Bush, that we had upgraded our patrol, our water rescue, our boat. Boat. Yes, sir. Uh, is that the 62,000 in here? Yes. That that's been spent uh for that. We just haven't paid it yet. Um, no, the invoices. We just got invoices for at least a portion of that. So that'll some of that will go over here. Yep. Yep. So as we as we pay these then the the purchase order comes off of there and it moves over to the actual expenditure line. Great question. Uh, any other business?

Second. All right. All those in favor? Thank you so much. Have a good night. Thank you, Mr.