City Council - Special Meeting

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Heat. Heat. [music] Heat. Heat. N.

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Hey baby. Happy Heat. Heat. N.

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Heat. Heat. Yeah. Uh, good afternoon everybody. Welcome to our special meeting. I'm going to call this meeting to order right at four o'clock. Um, madame clerk, would you please take role? Council member Dinus here.

Council member Dedricch is absent. Council member Temple here. Acting Mayor Carwin, I am here. And Mayor Estrada is absent. Thank you. Uh, did we hear from Council Member Dedric?

Madame Clerk, would you please take a revised role? Council member Dinus here. Council member Dedric here now. Council member Temple here. Acting Mayor Carwin. Thank you. I'm here. Just want to make sure we got you on the record there. Nobody thinks you're slacking off. Um all right. Let's uh let's please stand for the flag salute. I'll go ahead and lead it since it's just us here. Hand over your heart. Ready? Begin. I aliance to the flag of the United States of America and to the republic for it stands one nation under God indivisible with liberty and justice for all.

Thank you. So we have a special session today. We have one discussion item, the fiscal year 2526 midyear budget adjustments and review, including a capital improvement program status update. Director Hickeyi, would you please introduce the item?

Good afternoon, uh, acting mayor, members of council, city staff, members of the public, if we have anybody watching. But, uh, it's my pleasure to be here, uh, today to, uh, introduce this item. This is our fiscal year 2526 midyear budget review item. And so um you know I talk about it every time we talk about the budget. The the budget really is a collaborative process of all the departments within the city. So I always want to start with saying thank you to all the department heads and all of their staff for all the work that goes into uh putting any part of the the budget process together. Thank the executive office for their leadership and guidance on these items. I think the the the thank the city council for your leadership and developing the strategic plan that really builds the framework for the budget and a special thanks to the finance department and in particular deputy director Margarita Corno, principal accountant Dominic Tartalia and financial analyst Lori Lockwood who play a major part in putting the budget together. So with that, we'll get started. As you know, we have a a two-year budget cycle. uh we adopted the uh two-year budget back in June of 2025. So this is our first uh look at the uh in in into our two-year budget cycle. So with the two-year, it kind of allows us to have a longer term uh perspective on the budget and allows us to streamline the the budget process a little bit. But, you know, we do uh hold it paramount to uh keep our year-end uh financial reporting uh up to date and and true financial transparency. So, we want to make sure we have these regular check-ins with the council and with the public. And so, this is the first sort of uh major check-in at that point. And so, that's so we're at our midyear process for the first year of the budget 2526.

Uh we'll be back in a few months with the midcycle review which will be an update to the already adopted 2627 budget and then this time next year we'll be back with the midyear budget for the 2627 uh cycle. So so that's where we're at today. Um, you know, again, I mentioned the the council's role in in developing the the strategic plan. And within our strategic plan, we have our five strategic uh goals and and objectives. And so really everything in our budget is aligned with all of those projects uh with all of those strategic goals and priorities. Uh and so, you know, whenever departments are looking at their budget, we're always thinking about, okay, how does this tie in? How does this move us forward with our strategic goals and priorities? So, uh, so, uh, this is just kind of a an agenda for our workshop today. We're going to look at the adopted and adjusted budget, uh, which is kind of gets us to our point where we're at today. We're going to look at the economic outlook and our revenue adjustments we're proposing. Then, we're going to look at our expenditure adjustments we're proposing within the operating budget, looking at the personnel adjustments, operations and maintenance, capital outlay items. We're going to talk about the quality of life fund, look at the city's reserves, uh, and finish up with looking at the, uh, capital improvement program, uh, requests being made today. So, this is, uh, kind of a 30,000 foot uh, view level uh, of the what we're u proposing today. So, this in encompasses all of the requests that are being made as part of the midyear review. On the lefthand side are the expenditures. On the right hand side are the revenues and transfers. On the expenditure side kind of broken down between the operating requests and the CIP requests. Uh very minor item on the fiduciary requests

which is our our our CFD funds which really don't interfere with the city's activities. Uh but on the uh uh right side again is the revenues uh broken down by fund there and again a little bit of adjustment to our our fiduciary funds. And then on the bottom right we see the uh just over 3 $3 million uh in CIP funding that we're asking for for the CIP program and where those funds will come from. So throughout the workshop we're going to uh focus on uh each of these different uh categories. So, okay. So, uh we're going to start with the adopted and adjusted budget. Uh the uh column on the left there is the adopted budget. This is what the council adopted back in June. Revenues at $99.9 million, expenditures at 100 uh hundred million$100.6 million. Uh and so the the balance there being the use of fund balance part of the CIP program was funded through the use of fund balance. Uh the adjusted budget includes all of our carryover items brings our revenues to a total of $102.2 million and the expenditures to $106.1 million. So a lot of the items that go into that adjusted budget uh fit into a couple of categories. One is the carryover budget. So these things are like purchase orders and contracts which were already in process at the end of the last fiscal year. They carry over to the to the new fiscal year. Other items are if there's specific council approved programs or strategic uh action items. Uh and really the biggest one is our SQA related activities. So with all of the development that goes on, there's a lot of work that's done with our SQA consultants really that's funded by the developers seeking those projects. uh and so we roll those monies over uh from

year to year. And so that's a big adjustment both for revenues and expenditures. Then in addition to those carryover budgets, we have additional appropriations that the council makes uh throughout the current fiscal year. And so those are added into our adjusted budget as well. So So that brings us to our adjusted budget sort of as of today. And then now we're going to look at our midyear request which will then further adjust our budget for 2526. So shifting away from the general fund and quality of life. This uh slide is looking at the citywide adopted budget. Again, this is not adjusted. This was what was adopted back in June. A total of $142.4 million. the line share of that, the general fund and quality of life operating budgets at $99.4 million, the special revenue and other funds at $29.8 million, and then our CIP program which was budgeted at $13.2 million. So again, total citywide budget of $142.4 million. and that supports a a workforce of 336.5 full-time equivalent positions with 122 of those being in our police department. So, now we'll uh look at the kind of economic outlook as we u which we you know always look to in terms of kind of projecting our revenues. Uh and we're in a really interesting time right now. There's sort of a lot of kind of mixed feelings about the economy. You hear a lot of economists talk about the K-shaped economy where there is some segment of the population that is doing really well in this economy and there's another part of our population which is really not doing well in this economy. And so it's kind of a a tale of two

cities. Uh and so, you know, we see, you know, over $400 billion dollars invested in AI technology, rising income in in wealthy households, people who uh have 401k plans and invested in stocks that that continue to go up. S&P 500 is at record levels. Uh but um and through all but through all of that we have weaker labor markets, geopolitical uncertainty, a lot of talk about tariffs and and what really what do those mean for us? Uh and so it's just sort of a mixed bag about uh kind of where where we think the economy is going kind of on a national level. you know, on a state level, I think we were kind of projecting a a really weak uh performance at the state level, and it's been a a bit better than that. I think a lot of that has been that the uh increases in the tariffs have not passed on to a lot of the consumer goods and consumer demand is still strong. Uh but we've also seen weakening areas of the economy like in construction, leisure and hospitality, government funded services. So, so again it's kind of a mixed mix mixed bag looking at the state economy. So then when we look at you know our local economy here in city of Meny you know we're seeing really our revenues have uh have leveled off um you know not really declined just kind of leveling off. Uh we've seen our permitting activity really slow down in the first six months of this year, but in talking with our development departments, there are certainly some uh larger projects on the horizon that they're expecting to sort of make up for that slowing down activity in the first half of the year in the second half of the year. So, so you know all of these factors are taken into consideration in terms of u projecting uh any changes to our budget for our uh forecasted

revenues. And so when we uh look at the forecasted revenues, our our top five revenue sources both for the general fund and quality of life fund account those top five sources account for over 90% of the revenue for the general fund and quality of life fund. So that is the the really the line share of of our funding. Uh for our sales tax revenue, our property tax revenue, and our franchise fees, we're not uh proposing any adjustment to those revenue levels. Uh we're not really seeing uh evidence that we should increase them. Uh we're not seeing a lot of evidence that we should de decrease them. So, um, particularly with our sales tax revenue, there's there's a big lag between when those revenues are collected and when the city receives those. So, uh, we're always uh trying to uh, you know, forecast out as as best we can. U, but we think that we're on track to meet those revenue uh, numbers. We work with our consultant HDL companies uh who who looks at all of the vendors within our city but also statewide and has a lot of insight. Uh but uh at this point we're not projecting to uh we're not uh looking to change our forecast for any of those three revenue sources. So uh uh we do look at the property tax levy once that levy goes into place again with our consultant HDL uh when we got that when we pass the budget in June we have a kind of a preliminary analysis of assessed valuation uh but in July and August we get the actual valuation and based on the actual valuations we're u proposing an increase in the vehicle license fees of $300,000. So, the vehicle license fee revenue really is sort of a misnomer. It used to be years ago that the vehicle license fees really came from the vehicle

license fees, like the registration that you pay on your vehicles. It would go to the state and be distributed to the cities. But back like in 2004, that uh law was changed and the state kept all of that revenue and gave cities an additional share of property tax. So, even though we call it vehicle license fee revenue, it really grows and behaves just like property tax. And so when we got those property tax valuations in July and August, we saw that the uh provision for the vehicle license fee uh was low and we think we can increase that by $300,000. Now, we had already built in projected increases in property tax and so that's why we're not uh proposing to change our property tax revenue estimate. So uh in our development uh departments uh we are asking for uh an additional uh revenue increase of 395,000 but uh with that 250,000 of that is really for uh uh uh revenues to come from developers and and will be offset and paid for with an additional appropriation of 250,000 uh for professional services to do that work. And so really that additional revenue is covering that work. So it's not really additional revenue uh that we can use for other sorts of purposes. So that uh the the net difference there 145,000 was a a real revenue increase uh really driven by our our fire marshall's office with increased inspections uh from the industrial project as part of the Meny Valley specific plan. So uh so there was some additional revenue there. Uh outside of those t top five revenue sources, our investment uh income continues to grow and do well. Uh we always budget very conservatively with our investment earnings, but with our um

portfolio, we have now with rates sort of remaining constant. that rates have ticked down just a little bit, but really uh when we were putting the budget together, we were sort of fearing that rates could go back down to levels of several years ago where they're down 1 2%. Uh but we think they're going to hold strong at 3 to 4%. And so we think that uh we we've um already brought in a lot of that revenue already this year and think that the $550,000 increase is still a conservative uh projection for additional investment income uh for the general fund and quality of life funds. So So that's the majority of the the changes that we are asking for with the uh general fund and quality of life fund. So with this slide, we're looking at kind of citywide revenues. You see on the top there, the 1.295 million for the general fund and quality of life 50,000. We kind of talked about those already. Uh our internal service funds and the gas tax and other special revenue funds also benefit from the uh uh uh investment earnings income that we're getting. So that $140,000 and $125,000 is projecting additional investment income for those funds. The $111,000 negative revenue adjustment uh re uh is in um related to a CFD a development project where when we put the budget together in uh in June when the budget is adopted, we make uh assumptions about how many units will will become online by July 1st. uh we overestimated the number of units that would that were going to be completed and so that $111,000 reduces that uh levy that will be received within those CFD maintenance funds. So uh

additionally uh in our the bonded CFD funds which again is not the city's money but the city holds on to that money on behalf of developers. Uh then when they do the work and they submit their paperwork then we reimburse it to them. Uh and so we're talking, you know, tens of millions of dollars that we're holding for them. Uh we just overestimated how much uh investment income would be generated from them. And really it has to do with kind of how fast they're drawing down that money. Uh so we're we want to reduce that by that $24,000 there. So, uh, on the right side again is just the transfer in to the capital projects fund of just under $3.1 million, uh, for the request for the new, uh, capital projects to be funded at this time. So, so all in all, that's uh, just under $4.4 million of uh, revenue adjustments that we are bringing forward for consideration today. So, so, uh, with that and and if there's any questions along the way, I mean, feel free to, you know, jump in. But, uh, at this point, uh, I will turn it over to Margarita and she's going to talk about the, uh, expenditure analysis.

Hello. Good afternoon, mayor, prom, council members, staff, and anybody who's joining us in the YouTube universe. Today I will review uh quickly the expenditure um where we are to date and then also the requests that are uh being presented for your consideration this afternoon. So this slide just kind of highlights at the halfway point which is kind of where we are a little past that where we are by our major categories of expenditures. That's our workforce, our ongoing operations and maintenance and then our capital outlays. Um our public works director will touch on the CIP program a little later. So this is really again on the operating side. Um personnel is really the closest kind of expense that we can monitor at where are we at the 50% mark for comparison and as of December 2025 we were at 45.50 across all funds slightly higher on the general fund including quality of life and that percentage lower is just a natural kind of reflection of um naturally occurring vacancies that occur occur across the agency. The other two categories are a little bit trickier to analyze directly as a 50-50 match because there's a lot of timing, especially in some of the larger expenses um relating to the operating and maintenance area. Um those were at 34.14% citywide, 31% in the general fund, but there are some larger expenses that we receive um just overall throughout the year in timing. um specifically like our public safety related contract billing and our dispatch those always kind of fall a couple months behind. So that 34% um is not you know a reflection of ex all the expenses incurred at um December quite yet. Capital outlay similarly again these tend to be larger equipment oftent time things like vehicles and there's just a natural lag in receiving those. As of February 2026 we were at 30.6% 6% uh citywide.

And now we will go on to what the requests uh that are being proposed for expenditures are um summarized by the funding source as well as category and then the details of each one. uh part of this budget process in the best of times and even in lean years is always going to be to um never lose sight of the significance at at the end of the day this is taxpayer money and that the uh expenditure requests are ultimately meant to be investments that will make the city of Meny a community that thrives in all ways and in all aspects. So the recommendations that are being made today align with a number of operating personnel and capital outlays intended to do exactly that. As far as where is this being funded from, we have on the general fund and quality of life recommendations of just over under a million. Internal service fund specifically the IT fund is $89,000. other special revenue funds, $100,000. And the capital projects fund is uh funded either by quality of life or capital projects fund. And that is um to um add some additional funding to existing projects. When you break down into that $4.2 million into where it's going to be directed by the categories we just went through, that's about $571,000 directed to the operating maintenance area. Um 385 of that is coming from general fund quality of life. 109,000 is associated with personnel adjustment recommendations. $457,000 in changes recommended for capital alleys and onetime studies and then 3 million is for the CIP program. We did want

Margarita, can I I want to ask a question right here. I want to make sure I understand because this there's a lot of numbers coming at us. So this uh this slide right here is the adjustments. So that there's an additional $4.2 million we're looking to add to these budgets. Yes. And this slide, the the side of the slide saying the summary by budget category, operating, maintenance, personnel, etc., etc., that's where we're going to be taking the money from to put into the the general fund budget other way. Okay. So the on the let me get my direction. The left side is telling you where you're going to get the money from. That's the funding source. And the on the right side is where is the money going to go to? Where's the four million gonna go?

That's what I had backwards. Okay. So, we're taking the money from these sources and putting them into these four categories. Exactly. Thank you. I appreciate that. It makes it easier for me to follow along. Thank you.

And before we go into the detail of the 4.2, in addition, we did also want to note that in this exercise, the city does also look to where can we do savings with what already has been adopted. As the year continues, there are sometimes are opportunities to find operational savings within what's in place and um reprogram or repurpose to priority things that are identified in part of the midyear analysis. So, specifically, the city was able to find operational adjustments and savings that are not part of the 4.2, too. But we do want to note to fund $10,000 for a pilot microchip and um spayneuter program as well as $70,000 for animal sheltering services that has increased based on the number of animals the community has. And so one and two kind of go together as a way to one address the increase in cost but also find ways to mitigate um that increase in cost in the future. And then there is also $68,000 to support one-time meny related operations. That's things like trainings, space reconfigurations, and so forth. Okay, so the first category is operating and maintenance requests. I'm not going to read every single one, but I will highlight maybe some of the key ones and larger ones. Um, and some of them maybe the ones that were recently discussed, and I can certainly pause and for any questions that you guys may have. So the larger and quantity can be lumped together and that's $250,000 to support on call professional services in the planning site and construction inspection services. As our CFO Travis um mentioned, there is an offset revenue that adjustment that's going to offset these. So these will be covered with an adjustment on the revenue side. We also have it's a small amount, but it's a $15,000 that was discussed at most recently at the council meeting um to augment the independence day. So, that's a onetime addition, but that's there to support the um celebration as an enhanced event. There is also some turf replacement um addition for Central

Park as the pedestrian bridge moves forward for completion um just to kind of renovate that um existing grass. On the public safety side, there is and this is recommended from quality of life uh just under 30,000 or $28,360 addition to accommodate some technology upgrades to better um um increase the connectivity to the um basically dispatch record information that our police department is um regularly needing to access. Um so this technically would be an increase to the dispatch agreement because the software provider is um the agreement is with the city of Marietta but the real um increase is to justify is for these technology kind of API increases. And then in the bottom section, we have about $186,000 to address some additional licensing um Microsoft licensing renewals that we have to address. As well as to add one of the highlights is the green shrub fence along gets road which had been a prior request from council in the past to looking at that kind specific area. These are funded by um either our internal service funds, gas tax, in some cases the LLMD and so forth as indicated here. Moving on to the one-time capital outlays and studies. And these are areas of kind of looking at either studies, one-time again capital outlays and moving in the next direction. On December 17th, the council um and uh planning commission had a joint meeting to review the urban three study and kind of look at the agency from that kind of visual spatial way on kind of what our existing composition is of of revenues. And so the first item of $167,000 is that continuation of moving that momentum forward, that investment in economic development to be able to strategically kind of plan forward for the future in that way as we realize that, you know, part of the thing to make this community a thriving community is to diversify our revenues in whatever areas we can. And so this these studies

would kind of continue the phases of that way. We also have recommendations for um professional services to support landscape standard updates. Um it's a onetime thing, but it's been a more [clears throat] than 10 years, I believe, since the city comprehensively did something like that. And it's a worthy investment again to standardize as the city continues to um develop and add new um amenities and and landscaping. The public art standards and guidelines is listed here as an addition, but really it is a transfer from the capital project. The money is already sitting in the CIP program, but we're bringing it back to the operating budget and that's because to provide an opportunity to set some standards and guidelines and then come forward in the future once those are set up with some physical projects to move forward with. And then the last two under general fund are connected to um on September 22nd, the council had a meeting or joint meeting with the parks commission to assess what next moves and direction to move with Valleywide. And these are some of the measures that are or or um some of the actions that are necessary to support that. Um some application support services as well as some asset inventory for the valleywide parks. And I will turn the personnel component back over to our CFO. Yeah, I just wanted to cover the uh expenditure requests for our personnel functions. Uh on the uh upper left column there you can see uh none of the requests result in an increase in our full-time positions. We are holding at the 336.5 authorized positions. But we do have five existing personnel adjustments we're asking for along with some changes for our part-time personnel. Uh we're also uh asking to update our authorized position listing uh to uh add flex positions. These are positions that have kind of a one and a two. Instead of kind of budgeting ones and twos separately, we're just going to budget for the total

ones and twos to allow departments to have more flexibility in uh being able to promote someone from a one to a two. Uh we also have some updates to the executive uh personnel uh resolution. Uh these are primarily designed around uh who are the personnel involved in that. uh it does not affect anything to do with uh it doesn't change anything as far as fringe benefits or compensation. Uh likewise with the confidential personnel resolution update uh that is to uh specifically identify who is covered under that resolution but it doesn't change the compensation or benefits of of that for the confidential personnel. So uh in looking at the five uh existing personnel uh adjustments that are being proposed uh this is uh the first four really uh stem from uh a reg organization within the city to uh more uh directly align with the uh uh strategic initiatives that the the city is pursuing. Uh the first one uh is is a promotion for the deputy city manager to assistant city manager. Uh the second one is for the economic development manager uh to move to economic development director. Uh next is the uh public information officer and intergovernmental affairs officer to be director of communications and the deputy finance director to move to director of strategic initiatives and programs. Then uh and the uh salary ranges for those positions are are noted on the slide there. Uh in addition to that, there's a reclassification for a public works inspector 2 uh to a senior public works inspector. And then the part-time personnel uh budget adjustment uh is uh to comply with the new minimum wage uh rules that went into effect January 1st, but also to adjust other wage levels uh near those levels uh to avoid compaction issues between those

different uh wage levels. So, a total of uh all of those changes is a total of about $109,000 uh for the balance of the fiscal year. And so, um Director Hickey, the these numbers here, I noticed that there's a note on the bottom saying it's prrated for 5 months. This 109838, is that February to June? Is that annual? It's February. It's February to June.

So, for an annual basis, that's $220,000. Um the the the five positions up there. The total for full year cost is 129,000 for the uh um the portion for this year is about 44,000. So it's 44,000 plus the 65,000 for the part-time budget gets you to the 109. So the five full-time reclassifications cost for February to June is about $44,000. So the annual cost for that would be about $130,000 for ne next fiscal year. So on top of that $130,000 would be another about 65,000 for the part-time level. So um

hold on. I'm a little bit confused. What does this number 109838 represent? 109838 is the total of that column there. Uh which is the big portion of that is the 65,000 for the part-time personnel which is the minimum wage increase plus the dealing with the compaction issue. Then the balance of that is about 44,000 which is the February to June cost of those five positions. Okay. And then you were talking about 130,000. So the 130,000. So if we're looking at 44,000 for those five full-time positions, the full the full year cost of that would then be 129,000 for next year. That's what I was. All right. Thank you.

And I'll turn it back to Margarita to talk about quality of life.

Okay. Hello again. So coming up on just uh about our 10-y year anniversary of quality of life, this continues to be one of the city's kind of principal funding sources in certainly in the areas of supporting public safety and infrastructure. Um we met with the committee on January 22nd, 2026 to review the proposed midyear adjustments and we there are recommendations both on the revenue side, it's small amount on the interest side as well as some adjustments for public safety um infrastructure and some reserve recommendations. So what's up here is the adopted budget for 2526 when we met in June which was about 22.5 um million with the intentional use of fund balance. Um here are the recommended midyear adjustments on the revenue uh side. We are leaving the sales tax components exactly as um with HDL projections based on the revenue discussion that was presented earlier. But on the interest side, um we are recommending a $50,000 increase based on just the investment trends that have been recognized so far this year. Um on the expenditure side, the $28,360 is what we had talked on the operating side and this again as uh to support technology and integration updates of records data between Maretta and the city of Meny and our in our department. It is an ongoing cost. though we would be seeing this as well into um next year because it is a subscription cost for capital projects. There is a recommendation for $580,000 and this is to support the existing CIP project 25-05 Evans Road Craig's Avenue traffic signal. It is a project that already has quality of life funding and our director of public works will have uh more detail on that when he goes over the CIP direction. On the reserves side

and use of fund balance um at the top section are already reserves that were approved um at council adoption um including setting aside $1.2 $2 million for for the Macall I215 interchange project and the deliberate use of fund balance for the 2627 budget. Recommendations included at this time for reserves are specifically adding a million36,000 and that's to complement the 764,000 from the general front that have already been set aside to purchase the um engine of the future fire station that will be built. And there is a 90,000 $90,563 to be set aside to just um build up um reserves to continue to support public safety equipment as they may be needed. That's either fire or police. So closing out DD, we come to now what the whole circle looks like with the proposed recommendations and the carryovers that have already um happened. So the proposed citywide adjusted budget is 238 million. the largest magnitude. Again, the pie got bigger mainly on the CIP side. And that is because yes, when we do the budget adoption, we're looking at new numbers that are going to be added, but the CIP program, unlike the operating budget, is an ongoing thing, multi-year with complex elements of it. So really, it's the 13 is in addition to what's already in place. And you see the 99 being kind of like a connection back of the active CIP program that was already underway. Um the operating budget is proposed at $138 u million and the CIP program is just under $und00 million. The workforce as Travis indicated remains at 3 336.50 and with 122 that directed towards public safety and I will return back to Travis. Thank you. So I will uh finish up the finance

portion here before we get into CIP and talk about the uh general fund reserves. So that uh top figure up there, the fund balance at 7125. Uh this is I'm talking about general fund and quality of life. Uh these come from our audit that was just presented to the council. So we're talking 73 I'm sorry 93.7 million in the general fund and 5.5 million in the quality of life fund. That's a total of $99.2 million. Of that, we have existing level reserves of $81.9 million broken down in those three colored charts on the left hand side. So, the orange bar is our uh what we our 40% 40% reserve. And so, we have a 15% of that is for uh stabilization and emergencies. At 15% that's just under 14.9 million. additional 15% for economic uncertainty again at 15% or just under 14.9 million. Then an unassigned fund balance of 10% which is just over $9.9 million. And that's really just to make sure we have enough cash flows uh to operate and float our expenditures before revenues come in. So that 40% reserve is a total of $39.66 million. Uh and then we switch over to the green bar which is our what we call our reserve for savings. And so these were uh savings accounts that were set up by the council in our fund balance policy. One is our largest is the public facilities. That's uh $23.9 million. Uh there's different components within that $23.9 million. There's 4.7 that's kind of committed towards the city hall. There's 3.9 that's committed towards the uh uh community center. uh and then really the balance of that are sort of fluid between which facility they are uh set aside to support. Uh then aside from that we have kind of our set aside for

replacements for fleet and fire equipment at $1.764 million. Uh then we have our kind of stabilization funds. That's our self- insurance retention reserve and our unfunded liability pension reserve that is just over $900,000. Uh then moving over to the yellow bar is our sort of non-discretionary items. These are not really items that we have any ability to do anything with, but we have $5.5 million which was for from the Nova Battery Park community benefit agreement, but that money was pledged uh towards a development agreement uh to a developer who's going to be improving uh McCall Boulevard. And so as new developments come online and they pay their DIFF fees, uh we will use that money to pay back that developer. But this is money that is just set aside uh to in to make sure that the developer is paid back timely. Uh in addition to that we have just over 2.7 million that is restricted revenues for our general plan search charge, our technology search charge, our AMR fines uh that are restricted for those specific purposes. Then in addition to that, we have uh over $7.3 million that are the carryover amounts that we talked about in terms of the amounts that get carried over in our adjusted budget. So uh and so when those things get carried over, we carve that out of fund balance uh to ensure that uh that our budgets uh remain balanced. So, so with all of those together, that's uh $819 million, leaving $13.9 million available in the general fund and 3.1 available in the quality of life fund. So, uh based on the council adopted policy, we've uh allocated those funds in in the uh amounts as indicated on the screen. largest portions of the 13.9 million is 4.5 million that we're recommending to

set aside in our self-insured retention insurance of of uh to protect the city in the event of claims. Uh uh $3.8 8 million to fund our uh OPED liability uh reserve, 2.775 to set aside for fire services fund, just over 2 million uh in addition to our public facilities reserves, and then some smaller amounts for the unfunded uh pension liability and fleet replacement. Then on the quality of life, as Margarita talked about, we're looking to set aside just over a million dollars to fully fund the fire engine for the new fire station. just over 90,000 uh to add to the fleet replacement reserve. Uh and then 580,000 that would be uh what we're asking to allocate today towards the CIP project. Uh which would leave about 1.4 million. Uh that would uh we would look to bring that to the quality of life committee uh in the spring as we go into the midcycle review. That will be a program to CIPs in the midcycle update for fiscal year 2627. So uh that uh kind of covers where we stand uh in terms of our reserves and like I said that sort of concludes the presentation from the finance side. Uh be uh um Nick Fidler, director of public works will come up to talk about the CIP, but I can pause here if there's any questions uh uh on the finance side before we turn it over to Nick.

Yes. So council, this would be a good opportunity to ask any questions from the finance side of uh Director Hickey. Council member Dinus,

thank you. On the on the slide, there's 13 here about the personnel request. You have um was it three new directors? I don't not that I disagree with it, but I'd like to know um you know we it says that we're going to have those but it doesn't say I'd like to have seen a probably for our for Mondo that you know some kind of a an ORC chart as to how is this is going to be what is who's going to be reporting to who for one and then uh you know because and the director of strategic initiatives and programs but I hate to have that title man, this going I couldn't get it out. You know what what what what kind of what's a job description, I guess, of that? What what are we looking at to this position is going to uh work on and accomplish? We do we do I'm apologize for not including the org chart, but the the assistant city manager uh reclassification would include the addition of two more departments. one will be the HR department uh be overseeing that department and also the newly created department of director strategic initiatives. We have grown to be a city that has a lot of uh sort of an intergovernmental coordination with other agency to deal with the homeless [snorts] liaison to deal with uh things like the coordinating of the animal shelter. Um things like the the future efforts to build a university here to the region. And in addition, we have a lot of employee development initiatives in our city that are housing diff the responsibility is different people. One of one of it being the Meny University initiative where where we encourage our employees to you know seek higher

education, the the analyst collaborative, the innovation collaborative and uh our intent to continue to uh inject more in uh leadership initiatives into our staff. You know, we are in an in a in a time where a lot of our personnel is being poached by other cities and we're trying to do create an environment and a culture where people feel appreciated in our city. So, we're trying to inject more initiatives to be able to to keep uh higher number of of employees in the city. In other words, it's more of a retention program. So all those things are going to need to be started, initiated, and then over time as we grow to be a larger city, maybe a city that has over 400 employees, 500 employees, these are going to be well established programs that we're going to need to be able to make sure that employees um again are are are um they retain here at the city. So that's kind of the overall it's it's going to be an evolving department that uh today we're going to be including a whole bunch of these initiatives and over time is going to grow to be probably a very critical component of what we do as a management for the city.

Okay. So it'll be a new department. So will that require then hiring additional staff for that department? I think I think for now we are are planning to shuffle uh some employees around to be able to put together the the first of all the inventory of all these initiatives and then over time I I envision that over the next five years as we grow as a city as our cities grow we may need to start growing that department to bring in more staff. I don't anticipate that this year or the next year we we'll be adding more staff but over time and we're looking at you know a a horizon of about three to five years. This will be a must department to have. So

Okay. Um that Okay. I was just I was just curious because the staff report did not elaborate on any any of this. So, I was a little disappointed that you're asking council to approve all these new positions and you and it's just thrown out there without any explanation or reasoning behind it. So, I think you know in the future if you can bring something to the council like that at least allow us to know why you're asking for it and what their job is going to be. But that's all questions I have. Understood and apologize for not doing that. Any other questions from the financial side? Nope. Thank you very much. Director Fedler,

Before you get started, I just want to make sure I understand we're not we're not here talking about approp uh appropriating funds to CIP or ranking CIP. We're just talking about existing budgets and requests for allocation. That's correct. All right. Thank you.

Uh good afternoon, acting Mayor Carwin and council members. Nick Fidler, public works director. And as uh acting mayor mentioned, we are just talking about our midyear budget request and capital improvement program update and the effort to uh conserve time since we're running a little late here. I won't go through our mission uh and capital improvement program because I'm sure you're all familiar with that. But I would like to highlight on this slide, we we typically had nine categories we ranked our our projects in, but we did add a studies uh category because some of the studies don't fall within uh exactly within some of the existing categories. So that's a new item you'll see coming forward on future uh programs. So just a little background on this slide, these are the projects that were a part of our 2526 adopted CIP program. Uh we currently have 24 projects within the program. It's totaling 13 a little over $13 million. Uh a little background, the city uh or the capital improvement program staff are working on 39 projects that are in design phases which includes these uh 24 and uh we have seven projects that are in construction now and six projects that are either bidding or just about ready to be uh bidding. So, our staff is very busy um working through all these projects. Um this breaks down for each one of the the uh categories. Transportation, we have $1.8 million. Um as you can see in the second uh column, we're carrying $56 million. Just so you guys are aware, those are a lot of our larger projects like the Bradley Road bridge, the McCall interchange, the Garn Garbani interchange, the Scott Road widening. So that's why that number is so large is because it we're building up the funds to complete those projects and it also

includes the funds that are uh working through the uh Bradley Road bridge. And then we have a million dollars in traffic signal in our current uh budget and are carrying over 3.6 and then the same thing street improvements all the way down. I won't go through every number, but the just to highlight that we are, as Margarita indicated, we're carrying a a fairly large carryover right now at $96 million and we are requesting to increase that to $99 million, almost hund00 million with the additional three uh 08 million with the midyear budget request. So, backing up, we're asking for 1.4 in traffic signal category, uh 1.65 65 in the pavement management program. The $100,000 reduction is what Margarita also mentioned. That's uh removing the arts and the parks program from the capital improvement program. And then uh you can see at the very bottom we're transferring that uh 100 uh thousand back into the operating budget. So uh our midyear project funding and other uh requests. So, if you look at the first one, we're looking at CIP 2401, which is the citywide traffic signal safety improvements program. This is where we received a a large HSIP grant to go through and add some uh yellow um 3M tape around the perimeter. It improves the visibility at night at our traffic signals and helps them pop up as you're driving, so you can really see them as as you're coming up in the dark. Uh we're asking for a midyear uh request of $850,000. Uh there was some complications that happened while that we're in the design of this project. The the company stopped selling just the back plates. So we have to retrofit existing back plates that are there. So it's a little bit more labor intensive. Uh either that or we have to buy all new signal heads and

that that would really drive up the cost of the project. And then on top of that, we've had a few signals that have been added since the program started. And then we have a few project a few that we're combining with the county and the CALR facilities. So um that was what increased the cost on that project. CIP 255. This is the Evans Road and Craig Avenue traffic signal. This is one that Margarita had mentioned as well. We're asking for $580,000 uh quality of life. That's to complete the traffic signal at that intersection. And as most of you are aware, this is at a very inner uh busy intersection, especially at school times near Paloma High School. Um and then then we have the elementary school or middle school just to the south of it. So there's a lot of parents that are transferring between the two schools that really impact that intersection. And then 257, we have a AC resurfacing project. This is Lazy Creek. This project's actually out bidding right now as well. Um we are uh requesting an additional $1.05 million for that project to complete it. Um the pro we did a this was combined with another project that was up in the Sun City area. Um that that project went a little bit over budget and so the combination of this project and the past project um we're we're needing uh 1.05 to complete that project. We do have it bidding right now with an additive of alternate and the and this additional funding will help us complete the whole uh package of that proposed Lazy Creek improvements. And then we have a project uh not a project but our some of our operations staff um we go out and do some maintenance and uh pavement management uh maintenance. Um, we're requesting $600,000 to do some proactive preventative maintenance programs and

also to um improve some of our uh more heavily traveled corridors, putting a better writing surface on them. So, the total request is uh three 3,80,995 to go into the various the four various capital improvement projects. And then at the bottom, you'll see we have other requests. Um, we're asking that for authorization to periodically transfer direct personal cost for CIP project delivery from operating budget to CIP. Um, this is more to help us understand how much the projects truly cost. Uh, and in addition, when we're using funding sources that are not general fund, we're able to leverage state, federal, or other types of measure funds to offset the costs that would typically be absorbed by our general fund for our staffing. So, it's it's a good way for us to try to defer uh to um reduce our our uses on general fund because those those are more unlimited and we can uh f we can try to use those uh appropriately. And then the last little but uh button we uh item we talked about was transferring of $100,000 from the CIP 2413 the public arts project to operating budget for public arts uh standards and guidelines. Margarita touched on that as well. So before I guess I should back up uh before we get into that if there was any questions that uh councelor mayor may have before we move into the recommendations. City uh council, do we have any questions of this portion? I I I've got a quick question on this slide right here. So, um these funding sources here, this this is funds we've already received from these sources.

Yeah. So, so we have through measure A and SP1, we have savings in various projects. So, those monies will be transferred. Obviously, we just talked about the quality of life funding that um that Margarita mentioned for 2404. Um and then the gas tax. Yeah, there are all funds that we have available uh to utilize at this time. But these didn't come from general fund or developer fees. No, these are uh measure A, which is a statewide. No, it's a countywide house. Countywide quality of life is ours for this purpose. Uh SP1 is it statewide? SP1 is statewide and the gas tax is statewide. So, this is where these monies are coming from. We're just moving them from one account to another to get these projects done.

Correct. Understood. Thank you. Any other questions from the council? Thank you.

All right, so we'll move into recommendations. I'll save Travis from having to get up one more time. So, uh, recommended actions. Accept the fiscal year 202526 midyear budget review and approve the additional budget revenue and appropriations as presented and adopt a budget amendment resolution for fiscal year 2025 2526 midyear budget adjustments. And number three, adopt a resolution updating the city's authorized positioning, listings, and salary schedule approving staffing staffing modifications. And adopt a resolution amending resolution number 19838. adopt updating the language to uh clarify existing practices and currently available bud uh benefits for city executive employees and adopt a resolution amending resolution number 251584 amending the confidential personnel resolution to better reflect current departmental structure and boy I feel like clerk over here. Uh six, authorize the finance department to process as needed transfers of direct personal expenditures, actuals, and corresponding budget associated with capital improvement pro project efforts from the operating budget to the capital budget and receive an update on the fiscal year 25 202526 capital improvement program.

I don't know how you do it. Well done. All right. So, um now is the time when city council can ask any questions of staff. I know we've had a couple of opportunities to do that so far, but are there any other technical questions or of actual questions of staff that we have at this time? Nope. All right. Um, Madame Clerk, do we receive any request to speak or has any correspondence been received on this agenda item? We have none.

All right. Um, so at this point, any final comments or any need for discussion? I'll just come out and say this. I'm I'm just very impressed with the thoroughess of this. you can see why our financial reporting receives awards for transparency and thoroughess and accuracy every year. Um, this is excellent and like I said uh earlier, as I re reiterated earlier, this isn't about whether or not we're going to do the CIP projects. This is about funding the ones we have. So, and I I appreciate that. So, um, if there's no discussion, do we have a motion and second to do we need to do this one at a time? So, a motion and second approves the entire seven item lot. All right. Do we have a motion?

Also moved. A second. Everyone switch to your agenda screen. And that item passes 4. Well done staff. Thank you very much. Thank you. And uh looks like that is it. So at 458 we are adjourned.