City Council - Regular Meeting

And.

All right. Good evening, everybody. Thank you for allowing us a little extra time for our closed session. We're going to call the regular meeting to order. Before we get too far along here, I want to make mention of the fact that Council Member Martinez-Beltran will be participating by way of Zoom. And I think according to the law, Council Member, you'll need to indicate why you're on Zoom. Is that correct? Okay. Is she there?

I am here and I'm trying to figure this out. See if I can get this working, but I am with, I'm at home with my girls on spring.

Okay. And then you also, I think you have to indicate if there's anyone over the age of 18 in the room with you. Is that correct?

I don't know if that's correct, but I'm happy to answer.

That's correct, and also the camera needs to be on.

I'm working on the camera, and the only person is my husband.

Very good. Thank you for that. With that, Don, can we proceed? Okay, very good. At this point, we will ask if you'll all stand for the silent invocation and the Pledge of Allegiance. Amen. Now for the Pledge of Allegiance. I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation, under God, indivisible, with liberty and justice for all. Thank you. Please be seated. We now have a proclamation for the Donate Life Month. Thank you. We actually raised the Donate Life flag earlier today. And so the donate, yeah, if you just want to come on, come on up, all of you or whoever you're one, the whole group, the whole crowd can come on up for this, if you like.

Thank you.

Donor Network West has served for over 36 years as the federally designated organ procurement organization for Northern California and the Northern Nevada area, helping save and heal lives through organ, eye, and tissue donation. In 2025 alone, they coordinated 1,269 organ transplants each one representing a life saved and hope restored for patients and their families. Their work continues to make the meaningful and lasting impact supporting individuals and families throughout our region, including more than 612 people in Santa Clara County who are currently awaiting a life-saving transplant. In recognition of the National Donate Life Month, We extend our sincere appreciation to Donor Network West and its partners for their leadership, compassion, and unwavering commitment to saving lives and strengthening our communities.

Thank you so much. My name is Hua. I am the Community Engagement Specialist at Donor Network West. I want to take a moment to express my sincere gratitude to Mayor Turner and his team. National Donate Life Month was established by Donate Life America in 2003, observed in each April every single year. During National Donate Life Month, it helps raise awareness about donation and encourages folks to register as organ, eye, and tissue donors and honors those who have saved lives through the gift of donation. Your efforts have helped to amplify the crucial message reaching countless individuals and inspiring them to consider the life-saving impact of donation. Thank you so much for your partnership, your compassion, and your dedication to saving lives.

Thank you.

OK, with that, we have city reports and I'm up. And so I just I don't have many to report. I do want to just talk about one thing. I did receive an email from our folks who run the outdoor sports complex. And they said, I wanted to share with you some very exciting news for the O.V. Toros program, the soccer program. In Morgan Hill today, our club was selected. This and I got this email on Friday of last week. And they said today our club was selected to be part of a very elite national program called MLS Next. This acceptance is very hard to get. And it took years of work from our club. And more importantly, Jack, our director of coaching. What this means is that not just our club, but the complex and the city of Morgan Hill will now be put on the national level for youth soccer. And then I also got an email from Jack McMullen, the director. He said, beyond the significant exposure it brings to our city and local businesses, MLS Next also creates valuable opportunities for players to connect with colleges across the U.S., opening potential pathways for those interested in pursuing collegiate soccer. We're proud to now be recognized as one of the top 20 soccer clubs in Northern California among thousands of clubs across the state. This achievement further positions our city as a premier destination for sports, particularly soccer. Notably, we are the only club south of San Jose all the way to Santa Barbara that has been accepted into MLS Next and competing at the highest level of youth soccer. So congratulations to Obi, the Toros, and what a great opportunity and recognition for our city. So that's it for my report. And now for the city manager report, Christina. Not yet.

Okay, there we go. Good evening, Mr. Mayor, members of the council and community that's here tonight. Just a few updates for you. First is related to recreation summer programming. So make sure you check out our Parks and Rec summer offerings on April the 11th from 10 to noon. At the Railroad Park downtown, our recreation teammates are going to be there. They're going to be hosting a summer camp expo where parents and kids can find out about our fun summer recreation offerings. Also wanted to mention that our maintenance team partnered with a nonprofit called Our City Forest to install over 70 trees across the city over the last month. This included new oak trees in the Monterey Road median, new trees adjacent to the new Butterfield Park, and many more across the city. The trees and much of the installation costs were donated with the city maintenance team using in-house resources to prepare the sites for installation and support traffic control. And my next item is just announcing our next city council meeting will be on April 15th, right here in the council chamber. And with that, I conclude my remarks.

Thank you, Christina. And now for the city attorney's report.

Don, anything? Thank you, Mayor. The council met in close session just prior to this regular meeting. There was no reportable action on the one item they considered. Very good. Thank you, Don. Are there any other reports?

Council Member Liebers.

Thank you, Mayor. Last week, I attended a state community service policy committee that I've been appointed to for the state of California. And our emphasis was on how cities can help with childcare. So I will be reporting more when it's my turn to give a report, but I just wanted to tell you and be aware that that was on our radar last week and I attended. Thank you.

Thank you. Council Member Iwanaga.

Yeah, hi, I just wanted to report on my going to the Santa Clara Valley Water District Water Resources Committee that I'm part of. My fellow colleague also was there, Miriam Vega, and it was a good meeting. We learned a lot. We had a lot of interesting dialogue that came up specifically about the recycled water. And it was something that it got, we won't say the word heated, that's not, but it was interesting because it brought to mind the need as we grow as a city, how important it's going to be for us to look at this need that we're going to have in the future where we should be able to use our own water for recycling purposes, you know, recycled water use. So that was really interesting to learn the process of, you know, we don't want to face Another drought, which we know we will in the state of California. And what are we going to do if our water gets depleted and we don't have access to our own water supply because it's all being funneled down to Gilroy? So it was it was a good conversation. I learned quite a bit and I look forward to more conversation on that topic of of. You know, could we ever have our own little treatment plant? Maybe not the same size as Gilroy, but something similar. So that was exciting.

Very good. Thank you. Council Member Vega.

Hi, good evening. Thank you for being here. One of the first and most important things for me tonight is I have a lot of my students here. If you can please stand up so we can acknowledge you and welcome you. Thank you for coming from Salinas.

All right. Wow.

So I am assigned to outside, two outside committees and we met last Friday with the Upper Yagas in Anderson Dam. And me and Zoraida were both present and we got an update on that. And then we also got to spend a little bit of time with Chris. That's always great. And then this morning, we went to our scrum meeting also, and I was there with Sarita, and it was really interesting to find out that, you know, we can reuse or recycle water and we can do lots of stuff. And there is one of the commissioners who is really dedicated to making something happen. He doesn't want to wait any more time. So it'll be interesting to see what happens.

Very good. Council Member Martinez-Beltran, anything?

Thank you, Mayor. Yes, I just want to report that I had my ABAC meeting. I also had a housing policy meeting for the League of Cities. And so we'll be getting some of those recommendations on policy that are coming forward. Oh, and I also had a Labor Council brunch that went to. So thank you.

Very good. Thank you, Councilmember. And now public comment. Do you have anyone looking to make public comment?

We do, Mayor. We have Terry Johnson.

good evening mr mayor council staff and community my name is terry johnson i'm the marcom um see if i can keep this steady a director for the morgan hill historical society i was here in january to share a little bit about what the society is doing related to our 120th anniversary of this of uh our city's beginning And I wanted to come back and give you an update on a few of our initiatives that we're planning. We have seven projects in the midst or in the planning process. The first three I wanted to share, we just completed the month of March, which is... National Women's History Month that we celebrated by the society collaborating with the city and providing eight profiles of women from Morgana Hill who have made significant historic or cultural contributions. Brittany Sherman did a nice job taking that content and produced some really nice narrated videos that were distributed throughout the community. The next item I wanted to bring to your attention is Living History Day at Villa Miramonte. This is a collaborative project between the Society and Leadership Morgan Hill. Activities will include docent-led tours, children's activities, interactive exhibits, food, and a special tea house trivia game. So you won't want to miss it. That's Saturday, May 2nd from 11 to 3 o'clock at Villa Miramonte. And the third item I'll feature is is a new documentary that our films team is putting together we're very excited about. It's called Streets of Freedom. That'll debut on July 3rd at the Playhouse Theater at 2.30. And this will be a film that highlights the history of our Freedom Fest parade that began in 1876. Our filmmakers will pay tribute to the people who have devoted time and talent to host this celebration of freedom for enjoyment of residents of all ages, all walks of life, not only for Morgan Hill, but our surrounding communities. The film will provide an opportunity to appreciate our freedom and think about what it means to live in a democracy. Details for this documentary are on our website. The other four Romanian projects are Commemorative Magnet Project, Mary Blair Disney Exhibit, Morgan Hill Mobile History Tour, and last but not least, our Ghost Paranormal Adventure. They're all in development, and we look forward to hosting those for the city of Morgan Hill. Thank you. Thank you, Terry. Anyone else?

Our next speaker is Chris Robel.

Hi, good evening, Mayor and City Council and public. Happy April Fool's Day. So I wanted to talk about taxes. So as most of you know, today is the start of a sales tax increase. So everybody now pays 0.65% additional sales tax. because measure A passed. There's also on the June ballot new parcel tax for vector and insect control for the county if people are interested in voting for that tax. There's also a parcel tax for the open space reserve that will also be on the June ballot. There is a transit sales tax for another half cent sales tax increase in November to fund BART and VTA. And then the city, of course, is looking at new taxes for potentially 2028. And then there's Morgan Hill Unified School District that's looking at a tax for November. And that's what I wanted to hit on. So the city, at least in my assessment, has been... kudos to the city. They've been very transparent about the fiscal challenges and budget deficits forthcoming. You've engaged the community and you're having ongoing discussions about trade-offs and things like that. In very sharp contrast, our Morgan Hill Unified School District is an abject failure to summarize it. So they are being just the opposite of what you are. They are being obfuscations, obfuscation, non-transparent, And in terms of governance, there's a whole bunch of governance things I could go into, not timely responding to public records requests, on and on and on. Unlike you that does very short proclamations and gets to business, they spend hours talking about feel-good things and then have budget discussions past 10 o'clock at night when no one's watching with 200 PowerPoint slides. when no one is tired, when everyone's tired. So anyway, so from a governance standpoint, there's problems. From an academic standpoint, as the state of the city pointed out, there's failed academic results. So the city went from 50... from 47% proficient in third grade English to 37% in the last three years. So it's gone downhill fast. And then, like I said, the fiscal deficit spending is pretty draconian that's forecasted for the school district. So they're looking at a bond. $56 for every 100,000. So if you have a million dollar house, $560 a year for a bond lasting for decades. They're looking at a parcel tax of $136. So they're pulling all this right now and they'll be talking about it in April. But bottom line is, and maybe those things make sense, but not with failed leadership. And they have demonstrated all kinds of poor choices. They've gotten rid of eight teachers, There's a whole bunch of people that spoke about that a couple of weeks ago. They're not spending money in the proper place. We need new leadership. Carmen Garcia needs to go. Superintendent, she was fired from her last district. She needs to go. John Horner, the president, needs to go. Thank you. Thank you.

Any other comments? There are no other speakers. Very good. We'll close the public comment and move on to the adoption of the agenda. If I can get a motion to approve.

Motion.

A motion to approve.

Second.

I have a second. All in favor. You have to do a roll call, don't we?

Yes.

Yes. Roll call vote, please.

Mayor Turner.

Yes.

Council members Vega. Yes. Liebers. Yes. Iwanaga. Yes. Martinez Beltran.

I think you're on. Yes. Okay. Very good. Thank you. Council member. Very good that passes and then we'll move on to the consent calendar. No one on the dais or in the community is looking to pull an item. I'll entertain a motion to approve the consent calendar.

So moved.

I have a motion and a second. We'll take a roll call vote on this as well.

Mayor Turner?

Yes.

Council Member Vega? Yes. Liebers? Yes. Iwanaga? Yes. Martinez-Beltron? Yes.

Very good. Thank you. Then I'll take those to other business. Item six of my direction regarding community funding requests. Chris is going to come up and make the presentation for us first.

All right, good evening, Mayor and Council Members. Chris Chione, Public Services Director. With me is Nicole Martin, and we will be providing you a quick update on this item. Since this item is an item that was continued from the previous meeting, I'M NOT GOING TO GO THROUGH EVERYTHING THAT WENT THROUGH LAST MEETING. WHAT I'M GOING TO GO THROUGH IS BASICALLY MOVING FORWARD WITH A POTENTIALLY HELP THE COUNCIL MAKE A DECISION ON THIS ITEM. SO AS THE COUNCIL IS AWARE, WE OUTLINED MULTIPLE OPTIONS THE COUNCIL COULD TAKE DURING THE MARCH 18TH. meeting. We now have a new city staff recommendation tonight to present to the city that is obviously in your packet and you've been able to review. Just before we get started, understand this is a very important item for many community groups. It's a very important item for our community and it's a very, very difficult item for the council to have to but the reality is the city is in a very difficult fiscal situation. So it's created a difficult decision for you all. So with the new staff recommendation, we took several things into consideration that we wanted to bring back forward. And this, the first one was the discussion that the council had on the 18th and how to potentially prioritize events So what we've done in this updated recommendation is really look at some of the things that were discussed and what the council really discussed, which is long-term events, events that impact the entire community, are open to the entire community and are larger in scale. We also wanted to take... recognize that there are increased public safety costs for all these events so that is something that we have recognized as a city and as a result of that this recommendation now includes for we're recommending that community groups that receive community funding and are required to hire city services or pay for city services, that those services be billed at a more of a direct cost. So the direct hourly rates associated with those services versus the what we would say is the hourly costs plus the overhead and all the administrative costs that go into funding. And that is what we have historically charged for many, many years. So there's a change in policy that we're recommending to the council on that for just those events that receive community funding, which would translate to about a 40% reduction in the cost for the same amount of city staff resources provided. So with that, we also wanted to recognize that for one event, the Friday Night Music Series, after they submitted their community funding proposal, they received funding. from the city cost estimates that were significantly higher than in prior years. We believe that that is necessary to make those events safe, but we do recognize that that came to them after their application for community funding was submitted. and what we've also recognized and this was based on the council's discussion too and what we're recommending is an expanded implementation timeline for funding reduction so the council had talked about significantly reducing the funding for many of the events and what we're now recommending is expanding that time frame depending on the type of event but up to three to four years before funding is reduced Now, there was about $460,000, a little bit less than $460,000, in requests that came in for community funding, and the city had $180,000 budgeted. With the new staff recommendation... We are still recommending in the first year, fiscal year 26-27, we will need to fund it at a higher level than the $180,000. And it would be at approximately $302,000. So $302,000 next year. But then each year, as we would reduce funding over the future years, it would drop. And it would drop a good amount each year, dropping down to $250,000. a little bit over $250,000 by the fourth year. And we're going to explain, I'm going to go through the recommendations for each of the events so it can be understood how that change will impact each of the events. So the first group we made a recommendation on is our long-serving events, what we're calling Level 1. And these are events that are high attendance, long-running, have had past funding for many, many years from community funding and are open to the public. Includes the Freedom Fest, Holiday Lights Parade and Tree Lighting and the Safe Trick or Treat. What we're recommending there is we're setting funding levels to fully fund the safety needs at that updated cost level that I talked through. So we'd be funding those at that level. What we would like to do over the four years is we'll plan to hold these funding levels even for the next four years for those groups. But then we would need to support those organizations in planning ensuring they can raise more funds to cover that even level of funding that the city is going to provide for future years and so that is what we have recommended staff has met with all those all met with most of the organizations in this category as well as the next two categories and discuss that with them and they have seemed amenable to that plan The next group of events is, well, a single event, what we would call our long-serving events in this level two. This is our Friday night music series put on by the Morgan Hill Chamber of Commerce. It's a high-attendance, long-running, open-to-the-public event, and it serves as an ongoing fundraiser for the organization. So we're recommending we set the funding levels to adjust and adjust the funding levels to meet the needs of the increased safety requirements that I mentioned for the first year, this coming year. However, we would reduce the funding over three years. So at year three, they would go back to receiving what they have received in past years, which is basically the cost to cover the use of the at the community center for that event. So that's the recommendation for them. The next level would be our long-serve events, level three. This is the Mushroom Festival. It's a high-attendance, long-running event, and it serves as a fundraiser for the organization. It's not open to the general public as the other events are. So what we're recommending here for this event is maintaining the funding level, which is a funding that covers the cost of the facility use only. And because as proposed with the new updated cost structure for city staff, they'll see a reduction in costs for this upcoming event. We are recommending it. move forward if the council approves these apologies changes tonight it would be go into effect for this year's event the next group of events the next group is actually events and programs that have been previously funded by the city and were funded last fiscal year um There's a plethora of events. This actually encompasses most of the events. But what we're recommending, based on some of the council's discussion and the city's fiscal situation, is to reduce funding for these events over the next three years. So we're recommending funding at 75% of the previous level received. So for 26-27, they would receive 75% of what they received in 2020. 526 so and then the following year it would be 50 followed by 25 the following year and then that funding would go away the year after that the city is looking for all events to make a coordinated effort to help the organizations advertise their fundraising needs and support them in that way I will note with these events, they are normally smaller in scale. Some may be open to the public, but they're smaller in size and have a plethora of benefits, but also are not the longest running supported events and some are programs, not events. So this recommendation is one that would help them gradually move to not receiving the city support and i just want to take a minute as we talk about this item to recognize that these are all good programs and events that we would like to see happen and if our fiscal situation was different this might be something the staff we could recommend to you to support in the future but given our current fiscal situation this is a recommendation The next level is events that were previously held but weren't funded in 2025-26. Yeah, sorry. So on this item, there's two events that are held by Caras and Nueva Esperanza, and there's a Holiday Posada and Dia de los Muertos. These were not funded in 25-26, but were previously funded. We have only recommended funding for events that were funded in the previous year, but as an alternative option, the council could choose to support this event with the level four events as well. The next group is kind of specific. These are events that are not recommended for funding. The first one is South Valley Civic Theater. Their funding request is to fund basically kind of a capital improvement for lighting inside the theater. We are actually recommending that it not be funded through the community funding process and South Valley Civic Theater be directed to work with city staff so that that funding can be evaluated. That need for lights can be evaluated against other facility needs in our recreation facilities. um the the feeding morgan hill program was a new program that requested funding as a new program we're not recommending any funding for new programs and the morgan hill historical society film debut and reception the organization rescinded their funding requests after i believe they received a sponsorship for that event so we're not recommending funding that for any further either This next slide is an important part of our recommendation because we would really like to see receive direction from the council on these items and these are not specific to the specific events but more of a policy change the city staff are recommending based on our fiscal situation. the first one that no new community funding request shall be accepted until the city's fiscal situation improves so as we would go out for future funding requests in future years unless the council provides alternate direction we would not open it up to new groups applying for funding The next one is event organizers that are receiving community funding and continue to receive community funding should not be allowed to expand the size footprint or make modifications to their event that expand the city support needs for the event. So if it requires more support, we would not want them to expand to do that. It just basically be keep your, it doesn't mean you can't change what's happening in your event. It means you can't expand it to, that creates a need for more resources. And then we are recommending that our city team use our existing resources to partner with organizations to really help them in identifying or promoting how they can fundraise for events and promoting them as resources. you know community groups that need funding support so how can we do that through our communication channels so we make that as a recommendation and then another recommendation is the city staff will work with event organizers to both look on the event organizer side and the city side to see if there's ways we can reduce costs for the event organizers or through any any means we can partner so we would make that as a recommendation And the last part is really just noting that requests for future funding shall not be guaranteed, even though we've outlined plans for the next four years. Those plans could change given what happens to the city in future years. future fiscal impacts to the city. So we could come back and say, hey, we can't actually fund at the level we wanted to this next year and might have to look at funding at a lesser level in 20, 27, 28, because revenues and other areas haven't come in. So with that, that concludes our report and we'd be happy to take any questions.

Thank you, Chris. Great report. And I do want to say, Christina, to you and to the staff, how much we think, speaking on behalf of the council and these event organizers, how much we appreciate the staff spending time to go back and sharpen your pencil and come back to us. with some modified numbers that really are helpful to our event organizers, enabling some of them to kind of, even though they may be phased out, if that's the direction we go, but finding ways to make this work so that most everybody gets something. So thank you for doing that. I have one quick question, then I'll turn it over to others. You're recommending, based on your recommendation, it's an additional $122,447. The question really is, where is that coming from? And in future years, with the additional funding amount, how is that going to be handled?

It would have to come out of the general fund reserve.

You're talking about this $122,000? Yes.

Yeah, so what Chris means is that when we bring forward our recommended budget for the upcoming year, and then we also provide a forecast for our years, we would incorporate this as a cost within the budget for those given years.

Okay. I was under the impression $122,000 was found through other means. It's not. Right.

So fiscal year 26, 27 is our upcoming budget, right? And so we're in the process now of bringing together a recommended budget that we'll bring to you in May. And so this additional amount will just be another expenditure item like any other expenditure item. And so we're already sharpening our pencils in all of the areas of the budget is what I would say to that question.

Okay.

Yeah.

Very good. Anyone else? Council Member Iwanaga.

Thanks, Chris. That was a great report. And like the mayor, I really appreciate all the number crunching and the ideas that you've thrown out because this has been a very stressful week ever since this kind of got thrown at us. It has been stressful, so I appreciate all the work. But my question, you brought up that you would be supporting fundraising efforts. Can you just give us some ideas of what you're thinking?

So on the city's end, we wouldn't be supporting the fundraising efforts directly. It'd be using our communication channels to try and support the efforts that the organizations are doing in fundraising. So we'd be using our existing channels through fundraising. um our communications team our parks and recreation team and um the development services team okay so like on the city 411 type thing right okay right you could be like in our you know as we as we people come forward and say hey we want to spawn through these things instead of just saying here's the opportunities to give the city money here's the opportunities for the groups that have the biggest need within the community all right thank you i just wanted to clarify

Council Member Vega.

Yes, sorry. I was also under the impression that the 122,447 was going to come from somewhere. So are we cutting other things from the general fund to come up with this money?

So it's difficult in this sort of situation because you're being asked to consider this sort of without the context of the full budget, right? Right. And so in putting together the budget, we're looking at all sorts of different savings. Okay. We're trying to bring to you a budget that reduces costs, which you're going to hear about as an item tonight, and looking at ways to increase revenue. So we are going to build, assuming council approves this, we're going to build it into the budget alongside cost savings in other areas. Okay.

I think it's important to note, so tonight's action isn't formally committing this funding, but it would be basically giving us direction. So as we come back with the budget, it is incorporated in. Okay.

But that is, if we approve that, that's what you're going to go do.

Yeah, so what this will do is give the information that's needed for the event organizers for their upcoming cycle. And we've kind of, we've put numbers in there for the out years, which is what we're hoping to do and what we're going to build into the forecast assuming council approves it. But as mentioned in the other staff recommendations, if we can't in the future because our budget won't allow, the economy gets worse, inflation gets worse, then council has the discretion in future years to not go forward with those amounts. I understand that.

I'm talking about this year though. We tell you to go forward. You're not going to come back to us Next month and say, hey, the 122,447 is not there. Sorry. No, it's going to be built in. All right. Okay. All done?

Yes. And by the way, thank you so much for doing this. I have no idea how helpful this was.

Council Member Liebers.

I agree. Thank you. This has been on my eyes for two weeks here. So it was really nice that you did a lot of the crunching for us and came up with great ideas of how to fund these things over a period of time and give them the organizations that are going to lose funds through the years ahead. They have time now to prepare, so I really like that. Thank you very much. I did want to tag on to what my colleague said, though. I just wanted to make sure when you were talking about we will help organizations and stuff through our channels, but we would not be printing materials or mailing any materials. Is that correct?

I don't believe so, but we, this is kind of something we've come up with as a plan over the last couple of weeks. So it's not, I will say it's not fully fleshed out the exact items that we would be able to do, but what we're trying to say is we recognize that there's a need and we'll use our available resources to support it. So I can't say if we have some You know, there could be some combination of something the city is sending out where we also promote those. That could be something that could go into it. I don't want to say for sure, but I don't envision us saying, hey, we're just going to do all the copies for you. I don't think that's not what we're intending to do.

Okay, good. Because that was my concern. I mean, that gets expensive. And then the labor to stuff envelopes or you might have a machine that does it or whatever, run labels and all that. That's going to add to city work time and city expense.

Right.

you know, whatever we can do to assist through our normal channels without a cost to us, I think is very, very helpful. So thank you.

Council Member Martinez-Beltran.

I agree. I really think that this is I think this has been really helpful to look at and I've been looking at it in different ways and trying to go back and see where we're at and all of the security costs that we're looking at going forward. I will say to premise, I don't feel comfortable building this into the budget at this time. I think that I think it's great if we want to go ahead and allocate for this year. But and and obviously we will. We've put out the application and people have put in their funding requests. But I just don't I'm uncomfortable doing that. the reduction out and whether or not we can change it. I just don't know that that's something that we want to do. It looks like it goes out to 20, 29, 30, you know, and some of this is a, is still a significant amount. So I think when we're looking at the security costs and, And I really appreciate the staff going back and looking at what could be done there. And I think that that was just, I really appreciate you taking all of our comments to heart and the organizations and trying to figure out what was the way forward. But I do see that we still have a significant amount and we're committing that over the years. And I guess I'm just very hesitant because I don't know where we're going. I don't know where that additional revenue is going to be coming in. And so I don't want to give any false pretenses to anybody as far as what we can and can't do. I also wanted to look at here, you know, I see that there's, it sounds like what we're looking at, and I'm looking at the large events for right now. that what we're saying by approving this is that 157,500 is going to the Freedom Fest, the 8,500 to the Safe Trick or Treat, 6,000 to Holiday Tree, and 45,000 to the Holiday Lights Parade. And then as the funding chart says that that will be going forward for the next four years, correct?

Yes.

Okay. So- perhaps there should be some scaling because I see that with the smaller events, there's definitely more scaling that is happening and they're quite significantly lower. And so I'd like to understand that.

That could definitely be something that council gives us direction to change. We were just trying to follow some of the direction the council provided at the past meeting on where to focus the funding.

Okay, I guess I'm just trying to understand. So what is the, is there something, I guess, is there some connection between the four years and the budget? Or I guess, why was it four years is what I'm trying to understand with the larger events.

We thought it'd be a reasonable, well, we forecasted the same level of funding for the larger events to stay flat and potentially that stays flat for good into the future, potentially. Okay. but based on council discussion at the last meeting with the smaller events and programs, we basically were looking to reduce and phase out funding. I will note, To your earlier question on not not funding in future years, our plan is to bring back community funding every year to grant the community funding, even at mid cycle. And so what is the city manager mentioned we'd be doing is just forecasting for the next. Several years at these levels, and so the council will have. an opportunity each year to adjust. And that was kind of my point saying none of this funding would be guaranteed for out years because if our fiscal condition declines or improves, different recommendations could be made at those times. But we think it's prudent to plan for the four years versus just leaving at the lower level for future years if the council is considering coming back and continuing these events. So that's why our recommendation was the way it is.

Okay, okay. And then I also see here, it talks about in the staff report, there's certain ones that are, for example, Freedom Fest is to hold for future years and set funding to cover safety mean. The next one is set funding levels. So I'm trying to understand what's the hold versus the set versus the maintain. And there's level one, level two, level three.

Yeah, so they actually adjusted the funding level down for the groups in level one. We adjusted funding based on what we saw as reduced costs and held it even. For Level 2, which was Friday Night Music Series, we actually adjusted the recommended funding up for the year one and then brought it down over three years because of the unexpected costs. At Level 3, for the Mushroom Festival, because of the reduced costs associated with the change in funding, Billing the billing rates for staff. They were actually held even with the past at the past funding level.

Okay. So you're saying it stayed at the past funding level.

Yeah.

Okay. And then I see is the total to that, Chris, that this is actually, we said there was 180,000 and this is at three 65, one 23. Okay.

To the $180,000 budgeted.

Right. And actually, that's not true. It's at the $458,681.

Correct. And I spoke wrong. Forecasted. Nothing's budgeted yet because we're bringing the budget forward, but it was forecasted in our forecast.

So this is over two times our budget.

So just to clarify, I think you're looking at the column that represents what the fiscal year 26-27 request was. And that totaled $458,000. That was the original request. But then the column that's to the right of that Based on the new cost estimates related to the lower hourly rates. So we're stripping out the fully burdened amount. And so it's just the direct salary and overtime costs. And so that's where you get to that total. It's off to the right there, which is $365,000. Okay. Okay.

So first of all, the cost for security, really appreciate that. And I think that was great way to look at that, as long as that's not impacting our general fund. And I think that that was very creative and appreciative of that. However, it still does leave us at 365, which is over twice our original budget, correct?

And just to clarify, you need to look at the next column, which is the new phase reduction recommendation. And so it's the 302,000. And so that's based on the recommendation on the different levels of funding. And so it totals $302,000, which if you compare that with $180,000, it's a need of $122,000. Okay, so it's the 302 or the 365?

The recommendation for fiscal year 26-27 funding for council community promotions is $302,000. Okay, so that's paring it down from after you. engineered those correct okay great okay thank you and then I'll move down to level three and I'm sorry to the smaller ones where you have them lined out here and I do you know wonder why you didn't include the caras for via de los muertos and the holiday posada those are both events that not only align you know, with our strategic priorities, they've been very well attended and, um, have been demanded in the past but they've also been long running and they've had they have been part of this process every year except last year and so you know looking to see if that could be included in the level i think you call it level five to go to the level four which is the hanukkah celebration the healthier kids live above the influence open studios founders dinner um poppy jasper I'm maybe forgetting.

Yeah.

Yeah. Real quick. I'm sorry to interrupt. You'll have a chance to answer this question and then we're going to go to public comment after that council member, your time is up on that.

That is listed as a council option. It'd be an option for the council if they chose to go that direction.

Right. But I'm just looking at the criteria and wondering why it wasn't as part of level four. If it they've every year, except last year.

Yeah, so we recommended, and this started with even the previous meeting, we have recommended only events that received funding in the previous year continue to receive funding. That's the recommendation. The council could change that criteria and prioritize it. That would be up to the discretion of the council.

Okay, we're going to go to public comment. Do we have any public comments on this item?

Yes, we do. Our first speaker is Doug Meerhead.

Good evening, Council and staff. My name is Doug Muirhead, Morgan Hill resident. I think this improved city proposal is moving in the right direction. In the future, however, I would prioritize long-term funding for events to support the city's economic development and tourism goals. For example, Reedham Fest and Mushroom Festival. Then perhaps a few feel-good events in partnership with downtown businesses, such as Safe Trick or Treat and Holiday Lights Parade. But no more repeat funding for other organizations. Instead, select, perhaps by lottery, a few organizations each year to be in the spotlight with a small grant, and then the next year, ROTATE TO ANOTHER GROUP TO GIVE THEM AN OPPORTUNITY TO BE IN THE SPOTLIGHT. I WOULD ALSO LIKE YOU TO CONSIDER THAT WE ARE DIVIDED INTO DISTRICTS. SO ALLOCATE SOME FUNDS TO EACH DISTRICT AS IS DONE FOR COUNTY SUPERVISORS AND SAN JOSE CITY COUNCIL MEMBERS. IN CLOSING, I WANT YOU TO CONGRATULATE YOURSELVES or what can happen when you do not accept the first version of a staff recommendation. City staff developed this new proposal to support the short-term needs of event organizers, while at the same time supporting the longer-term financial needs of the city. Thumbs up. Thank you.

Thank you, Doug.

Anyone else?

Our next speaker is Nick Geish.

Thank you, Mr. Mayor, council members, staff, community. I'm speaking to you tonight as CEO and president of the Morton Hill Chamber of Commerce. On behalf of the chamber, I want to express my sincere appreciation for your willingness to revisit a significant and anticipated cost increase for Friday Night Music Series that was identified after we submitted our community funding request and discussed in the March 18th meeting. Now, as the Council knows, the Friday Night Music Series is a long-standing, no-cost community event in Morgan Hill, now spanning 22 years. With an average weekly attendance of 1,500 to 2,000 people, it remains one of the Chamber's most visible events, a cherished summer destination, and our largest budgeted fundraiser, helping us to stabilize the Chamber's full range of services and programs for more than 500 businesses, students, nonprofits, residents of Morgan Hill. We welcome and actually applaud the staff's recommendation for a four-year strategic financial model for the city funding allocations. This approach strengthens our budgeting forecast well in advance of the event, ensuring year after year a sustainable and actionable plan for Friday Night Music Series security expense-related impacts. It also represents a significant positive step towards the event long-term's viability. We are grateful for the collaboration discussions over the past couple of weeks and for the staff's revised recommendations as outlined in the report. And we pledge to continue our partnership to keep Friday Night Music Series a vibrant, accessible and inclusive gathering that strengthens our shared civic pride. I want to thank you for the consideration of our submission and for the city's ongoing commitment to community supported events such as Friday Night Music Series. Thank you. Thank you, Nick. Anyone else?

Next speaker is Maddie Scarriott.

Hi, Mayor and City Council. I'm Maddie Scariot, the director of the Poppy Jasper International Film Festival, and I'm like six days away, so I'm a little bit brain dead. But I'm so sorry that I'm having to ask you for money, but we really do need it. We really work very hard in bringing people to our community. We aren't bringing tens of thousands or hundreds of thousands, but we do impact the community with an economic impact. Visit California listed us as 90 events in the Central Coast as one of the top five events for tourism, and that's right next to the Monterey Jazz Festival. We bring in influencers and people from the industry. We create mentorships. We have a new song for the film festival. We have local musicians from Morgan Hill and Gilroy and Hollister that wrote a song with the president of Paramount Music and Jared Fry, who is doing Brad Pitt's next movie, composing it, and will be premiering it right here in Morgan Hill. It's giving these young musicians an opportunity to work with the industry. And then we also were told that it's going to qualify for a Grammy. Those are just one of the stories that we do. And hopefully that's meaningful to you. I know it's meaningful for me growing up in Gilroy with just like 12,000 people living there and wanting to be in the movie industry, but never saw myself. I mean, thrilled to bring this festival to this area, the whole region. And we have over 100 volunteers that do 8000 volunteer hours to bring this festival here. And so I know you're having a hard time and I appreciate that. And anything we can get really helps us. It's hard to raise money for the arts, just really, really hard. So thank you so much for even considering.

Thank you, Maddie. Anyone else?

There are no more speakers.

Very good. We'll close the public comment, bring it back for council discussion. And again, I want to reiterate, as we had all mentioned last last council meeting, how difficult this is. We know that every event, every organization that has asked for money and is doing something for the community, is doing something good for the community. And we appreciate that. We are up against it this year. And I think based on what the council or what the staff has recommended really is a great compromise. And so I'll open it up now for any other comments by council members. If not, council member Martinez-Beltran, please go right ahead.

Thank you. I, you know, like I said, I think this makes me a little bit nervous. Granting out the four years without really knowing where where we're going. I guess I would have preferred to have that budget discussion before this. And so that's probably my biggest hesitation is just that I understand, of course, the need. I've worked with all of these organizers. They work tirelessly to bring this But it is, I mean, you know, some of these 157, 50, 45,000, I mean, these are 25,000. These are significant amounts. And so I appreciate how the staff is trying to contain them. But I also think that... you know, it's probably a lot more than we're able to do at this point. But if you all are in agreement, then, you know, I can certainly get on board with that and hoping that we'll, you know, we'll have to look at this again when it comes back, I guess. And that's part of, you know, that's part of the hard stuff that we have to do, right? So what I would ask, though, of my colleagues is to, you know, again, Caras and Nueva Esperanza have been putting on these events for, you know, They've received community funding every year, and it meets all of the, you know, what staff has put in their staff report. They're open to all residents. Number two, number three are free to attend. Number four, longstanding events. Five. The only year they have not received funding was last year. And so I would ask that, and it looks like these are even, these smaller events, unfortunately, they're not even being funded at full cost, but I would ask that we include those funding. And, you know, we've had one is for the Dia de los Muertos altar, which certainly has had lots of demand for that, that sits at the corner of Monterey and Dunn. Everybody can see that we've had, we have tons of people who come by and leave things and comment. And it certainly has definitely grown every year. And then we have the annual Posada where we have both of these events have kind of laid the groundwork for even others creating, you know, I know the city looked at doing a post this year. So it's certainly a thing that is demanded and much interest as you, you know, I know that some of you have attended this event as well. So I will leave it at that. And I think, you know, we'll have to discuss, I think that the, the gist of it, of the 3.0, you know, to where that's how we're gonna make that work, I guess, with some of our other priorities.

Yeah, I appreciate that council member. And I think to your point, as we look at this as being something that's four years out, I really do think that what we would be recommending tonight is this is really a, what we're looking at is really codifying fiscal year 26, 27. And then each year, really, we're gonna be talking about, because we might get to the following year and say, we don't have the money. As Chris had mentioned, there's no guarantee. So I think it is something we have to look at each year. So I think you make a good point on that. Anybody else want to? comment or make a motion? Yes.

I mean, from what they're saying is they're just forecasting. It's not that it's written in stone and we have a contract and we have to do it. It's just for us to look at it four years moving forward and also to give these organizations an opportunity to know, hey, this might not happen next year, so we need to start working on our own or separately from the city of Morgan Hill. So I think it's a really good tool, not just for us to look at, but also for the organizations who are going to be losing funding every year or completely lose it because they know that that's a possibility. So I'm comfortable with forecasts. I like to see ahead. And this gives me a little bit of the future. And if things change, then we have the opportunity to go back. And then also this is going to come back to us every year. So if you're really comfortable with this, it's numbers and it's forecast. forecasting and it's giving our community also what we're looking at and so that way they can also start thinking in their heads what's coming ahead so it's important it's like pre-planning right and they know what's coming so i'm comfortable with this because we have a choice to accept it or to change it every year and this gives me numbers so i feel comfortable with it anyone else

I would just like to say too, I thought that that's, you know, on that note, I think it would be great so that we can, we want to give the organizers as much heads up as we want, you know, as possible. Maybe we could have a lookout in six months and just kind of look at, do we think we're going to be close to their number? Do we think it's, you know, so they know, so they can plan. And it's not a surprise to them, which was really great having this early this year. So we were able to give people that notice, I think. And then I will make a motion as well. that I will, you know, that I'd like to go ahead and accept the recommendation, but I would ask that those two are moved to from the level, I forget what they call it, a level five to a level four for the Caracenova Esperanza, for Dia de los Muertos and the Holiday Posada. That's my motion, Mayor.

Yeah, we have a motion. I don't know if, do we have a second? And I know there were some comments that were to be made. So we have a motion. If we have a second, we'll move forward. If we don't.

But that's to change it, right?

That's a motion to change it.

The ones that are at the level six. You know, I guess. Hold on. Yeah.

You first have to go through. Just a second. Hold on one second. We have a motion. And now we're looking for a second. If there isn't a second, motion dies and we will keep talking.

So the question- I want to make sure she understands the motion. The motion is to include the Caras en Nueva Esperanza Dia de los Muertos altar celebration and the Holiday Posada into, it's not a full funding, but at least it's some funding at level four rather than no funding at all. Because it has met all of those except for it did not receive funding last year.

Okay, so we have a motion. Is there a second? There's no second, so that motion dies. We'll continue the conversation. Council Member Iwanaga.

Right. So, yeah. And that was so my understanding is those did not make the list because they weren't funded last year. Right. So and I know all of those things still occurred. And I'm aware from community members that there is other sources that have been providing some funds for those events. So I don't. I don't feel, well, we'll use the word guilty. I feel guilty, right? You look at this list. You want to give everybody money. This is not my favorite part of the job. But I am comfortable with the recommendation that the city has made, the hard work that they put into it. And I do feel that it gives them ample time to start thinking in the future. And really, as a community, I think this has been very eye opening for us all, because the reality is, you know, we need money. to do the things that we want for our city. So I think it's not just for the organizations, but every community member needs to start getting that into the head that a lot of things can go away in the future if this does not get resolved financially as a city. So I am happy with the recommendations and I'm gonna, well, I think my calling, go ahead.

Well, I think real quick. Okay, Council Member Vega.

I mean, the staff did follow instructions. We did say, please include the organizations that we included funding to for last year. And based on what we asked, you came back. So I think that is fair that we asked you to do something and it was the majority. And you came back and gave us exactly what we asked for you to do. So I feel comfortable for that reason. And guilt is not even a word. It's beyond guilt right now. But I mean, we did ask the staff to go do their due diligence. You guys did. And you got coming back with what we asked you for. So I'm comfortable with this as well, because that was what we asked for.

Council Member Liebers.

Yes. Thank you for everybody's input, public and online and here at the dais. I know staff put a lot of time into this, thank you, and it has been heart wrenching on many levels, but I am prepared to make a motion to approve as presented. And we'll see what happens. I do like, and I don't want to make it part of the motion, but I do like my colleague's suggestion that we review this in six months. So, but it's not.

Okay, let's just do this. Let's state your motion as you want to present it.

Okay, I did. I accept staff's presentation as presented.

So, so we have a motion to accept the staff's recommendation.

I second that. We have a second and we'll do and I still I I'd like to have some debate on that and I just want to you know clarify I mean we're we've had requests here that were 70,000 now I mean we're talking. thousands of dollars. And these two events have been happening for years. Every event has other sources. This is not the only source. All of these events have other sources that they're getting funds from because people are scrambling and trying to make up those dollars. These are significant events for our Latino community that they go to and that are not readily available in another area. I think we have just dedicated many resources to the economic mobility and where we talk about wanting to have diversity and inclusion and people feeling like they have a way to plug in so that they can be civically active. And so I just offer that as we are talking about this. And I think it's really... a shame that we're not able to, you know, continue to help these. Sorry, there was a blurb there that unable to help these events continue to go when the city itself, you know, help was was working on a posada this year. And working in combat that that tells you how how much these events are valued throughout our community. So I feel like this is definitely a misalignment with the resources that we've dedicated in services to economic mobility and beyond. But thank you.

Thank you. We have a motion and a second. We'll do a roll call vote.

Mayor Turner.

Yes.

Council Member Vega. Yes. Liebers. Yes. Iwanaga. Yes. Martinez Beltran.

Nay.

Very good. That passes four to one. We'll move on to item seven, adopt a resolution calling for the general municipal election to be held on Tuesday, November 3rd, consolidating the election services with the County Santa Clara Registrar voters. This is for placing a measure on the ballot to change the elective city treasurer position to an appointed position.

Mr. Mayor, are you comfortable taking a five to ten minute break before we hear this item?

Can we do a five minute break?

Absolutely. Okay.

We'll return, let's see, we'll return at, what do we have here? 7.45.

Meeting back to order.

Exactly, I know. All right, everybody, we're going to call the meeting back to order. If I can get the council members on the dais. Here we go. Don't make me use that gavel again. A lot of authority in that gavel, wasn't there?

Yeah, that's right. Oh, that's funny.

Yeah, I'll come back there.

Okay, we are, everyone's back. We are on item seven. Michelle.

Good evening, Mayor, Council, community. My name is Michelle Bigelow, City Clerk. The item before you this evening is to call our general election for November 2026. As a part of that election, we also consolidate election services with the county. So there are two resolutions to call the election and to consolidate services. So on the ballot for this election, we have the mayor's seat. and city council seats for districts B and D. This will be the first election that the mayor's seat is a four-year term, since that was put into effect two years ago, and the council seats are four-year terms. There is another resolution as a part of our staff report this evening, and that is to place a measure on the ballot that would ask the voters if they want to change our elective city treasurer to an appointive position. The council has discussed this item a couple of times in the past and in June of 2024 had asked staff to come back in the spring of 2026 with a resolution to place that on the ballot and to just refresh the council and community on why we might do that. So the treasurer is an elective position, but over the years, the requirements of that position have changed, and we are not able to change the requirements for elective positions. So in order to be an elected city treasurer, you just need to be a resident within the city of Morgan Hill, 18 years old, and a registered voter. We can't put requirements on that position to have any sort of financial training or background. And as the roles of the treasurer change, have increased. We feel it's prudent to ensure that we have a treasurer that has those financial skills and abilities. And this is similar to what council did a few years ago with the city clerk's position. The cost to put a measure on the ballot is about $80,000. That's an estimate from the registrar voters. We anticipate that by having an appointive treasurer position, should the voters choose to do so, We would save about $15,000 every four years in election costs and approximately $40,000 a year in staff costs for that elected treasurer position. And so those costs for the measure would be made up in just two years' time. Some folks feel like an elective treasurer is beneficial because it is directly appointed by the voters and it can encourage competition so you get more people. We have not had that experience, the competition. We've struggled to have folks interested in running for treasurer. So that combined with the increased duties and responsibilities staff and council in the past have directed that we would move this forward to the ballot. So there are three resolutions. Resolution A is to call the election. Resolution B is to direct staff to consolidate with the county registrar voters. And Resolution C would be placing that appointive treasurer measure on the ballot. And just one last note, we would recommend doing this this year in 2026, because it is the midterm of the treasurer's position. And if we were to wait until 2028, and this is why council directed us in 2024 to wait two years, we would have a measure on the ballot that would be competing with somebody potentially running for the office, which isn't generally advised. With that, I conclude my report. Do you have any questions?

Very good. Thank you, Michelle. Any questions by the council? Council member Martinez Beltran, any questions? Very good. No questions. We'll open for public comment. Any public comment on this item?

There are no speakers.

We'll close the public comment, bring it back. If there's no further discussion, then we'll entertain a motion. Now, Don, do we need to take these individually or can this be all done at one time?

This can be done at one time by roll call. Okay. Very good. So just if somebody wants to move staff recommendation. Okay. Do I have a motion?

Motion. Second.

I have a motion and a second.

And it's a motion for staff recommendation. Yes. Motion for staff recommendation. Yes. Thank you for that. Vicki, if you'll do roll call.

Mayor Turner.

Yes.

Council Member Vega. Yes. Liebers. Yes. Iwanaga. Yes. Martinez-Feltron. Aye.

Very good. That passes 5-0. That's unanimous vote. And we'll move on to, thank you, Michelle, and move on to item eight. Big jump.

Good evening, Mayor, members of Council, community of Morgan Hill, John Lang, Housing and Economic Mobility Director for the City. I will provide a brief verbal presentation to you this evening regarding the Skills Project. We are before you tonight seeking two actions by Council. The first action is to extend a loan with the Eden Housing for another 20 years. The current loan is going to expire April 13th, 2026. So just within weeks from now, that loan will be expiring. That loan dates back actually to 1994, 95, when this redevelopment agency and South County Community Housing envisioned redoing and reconstructing the skills hotel. The loan was amended in 2006 with a 20 year term and that brings us to now. So we are seeking council approval to allow the city manager to negotiate and execute a loan extension of another 20 years keeping the same interest rate with one minor modification in the term which would allow in essence residual receipts or what is also known as surplus cash to go back into a fund that supports capital improvements. That is the first action We are seeking from council this evening. The second action is tied to this issue of residual receipts. So the skills building was rehabilitated, reconstructed in 1994 and 1995. The project is just under 7,000 square feet. It has 13 single resident occupancy units and a commercial space, which is currently Ladera Grove. That building is now over 30 years old and starting to experience wear and tear over that time. In particular, within the last couple of years, there have been some plumbing issues, in particular sewer-related issues, where there have been leaks that have occurred that both impact the residents living there and certainly the commercial tenant. In addition to the aging infrastructure, there needs to be... a roof replacement. Eden Housing has gotten quotes on various capital improvements that need to be done to maintain this facility. I do want to make clear that this is a long term ground lease this is land that was originally owned by the redevelopment agency, which is now owned by the city in this building is a long term ground lease to ground lease for 55 years so effectively, it is our building to maintain. And therefore, we are seeking council authority to allow the city manager to negotiate and execute a grant agreement of $800,000 to support capital improvements within that building that both benefit the residents as well as the commercial tenant below. I do want to make very clear the funding for this project comes out of the housing mitigation funds. These are housing funds. There is no general fund revenue that would be going into this project. The housing mitigation funds are used to support affordable housing in our community, whether it's rehabilitation, land acquisition for affordable housing, or actually putting money into projects to build affordable housing. That concludes staff's report. Brian Dove with Eden Housing is also here, should you have further questions about the project. But we are seeking council's approval for these two actions related to the skills building.

Thank you, John. Any questions by council?

Please go right ahead.

What's our current interest rate for the loan?

The current interest rate is 3%. It's very low.

And then you said the original loan was when? Again, I'm sorry, can you repeat that?

The original loan started in 1994, 95 period. The loan was renegotiated in 2006. And at that point, the South County Housing, which no longer exists, contributed about $100,000 to the principal balance. So they lowered the original $300,000 loan. So they were able to make a lump sum payment. The terms got renegotiated in 2006. So right now, the loan as it stands based upon the principal balance in interest is about $226,000. And that is being looked to extend for another 20 years at the 3% interest rate.

So are they currently not making any payments on interest or anything?

They do make annual principal payments per the agreement. They also At that 2006 renegotiation, there was a change at that point in time, and it said if there's any residual amount, they would pay that plus a principal amount. So we historically have gotten about $6,000 a year, which is a combination of direct principal and this residual payment or surplus cash. So what we're asking to do is move forward. We'd still get a principal payment every year, The residual or surplus cash of about $3,000 would go into a sinking fund to support the capital improvement.

And you said right now there's currently 13 people living there or apartments?

There's 13 units, 11 of which are occupied. There are two that are currently vacant. I did want to also share that A vast majority of the residents in the skills building have lived there a very long time. This is considered very low income housing as far as an area median income. So if you look at the table for area median income, it's the 50% level, very low income.

And the $800,000 would be additional, would have given them another loan for $800,000 at the same rate of 3%?

This would be a grant. This would not be a loan. The reality is there are only 13 units at very low income. So the amount of rent generated from that building is not necessarily supporting all the ongoing costs and creating a capital fund for the improvements. So we would be looking to provide them the money for doing these improvements. They did inquire with the county about leveraging measure a funds to support this. The county was not able to support that you will see in your council packet that. Over the last roughly 6 years to 7 years, there have been multiple. times where we have said we will not accept the surplus payment. We'll give it back to help meet the operational requirements. And they have also tried for low-income housing tax credits twice. And the state has not been able to award them that. So They have certainly looked for other funding options to support these capital improvements, but the money needs to come from somewhere. And if we don't continue to keep the building in good operational, if we let it deteriorate, that is actually an asset that will impact us in the long run because it is a long-term ground lease that the city has.

Can you share what the rent is in there?

Yes, it is, as I said, income restricted at the very low income level and the rent for a unit is just a little bit over $1,700. I think it's $1,708. Okay, thank you. Anyone else? Council Member Martinez-Beltran?

No questions there. Oh, I'm sorry. Council member, you were not.

It just took a while to reach my brain. Sorry. So I just want to make sure I'm clarifying and I understood you correctly. So Eden Housing has actually reached out to the county for the funding, but they were denied. Right. And they reached out to the state. Do they ever receive any reasoning as to why they're not being granted these funds?

Yes. So they've competed twice for the low income housing tax credit through the state. It is a competition. And so through that competition, you're either awarded tax credits or you're not. And I don't know all the merits of their application, but the state did not award them any tax credits, and they've tried twice. In addition, the conversation with the county is the Measure 8 funds are basically gone. And recognizing the state of the county's budget as well, they just don't have the funding to support it right now.

Sorry. Outside the state and the county and us, What other potential funding could they tap into?

So there are some other mechanisms that staff has been talking with Eden Housing. So one of the other opportunities that does arise and would take some time to figure out is we have a couple other Eden has multiple projects as a portfolio in Morgan Hill. Via Chileno is another affordable housing project that is also fairly small in size. And they also face these challenges of when you have affordable rent, you only make so much money in rent and you have your operating expenses. about actually combining that into a single entity and maybe that will allow for a better competition and tax credits but once again as we've discussed in other projects around affordable housing when you start to talk about projects at lower levels of affordability very low extremely low it is often either the county or the city or both that fund these projects. That's how these projects happen. This is a particular product type that we do not have a lot of in our community at all. In fact, this is the only project that is single room occupant in Morgan Hill. And it is also serving a income level that we do not have a lot of product types. So it definitely furthers our goals in trying to provide a range of affordable housing in our community. And making sure that it's also livable. So when you have sewer problems, that's not a good problem for any tenant, commercial or residential. So we're looking to make those repairs in partnership with Eden Housing.

You may not have the answer to this, and I'm just thinking future. So because you're mentioning this particular group that we're serving with these types of units. So I guess my question is, because the state mandates so much housing, you know, and they put a lot of pressure on municipalities. Are you aware of or is there any kind of rumor around? of maybe a pushback where, okay, you're demanding this of us to build X, Y, and Z. Will you provide the funding for things like this, like Eden Housing?

So that's been one of the conversations. You may be familiar with the term pro-housing designation. That designation by the state was supposed to unlock funds for communities to provide a range of affordable housing. That has not happened yet. They have the designation. They do not. They do not have the funding yet. So that was one of the mechanisms that was intended to solve that.

We'll just rename it Fast Train to L.A. and maybe we'll get the money there. Right.

Sorry.

It's OK. I've got a couple of questions for you, John. The. The staff report says staff recommends the City Council's authorizing measure execute up to $800,000 one-time funding. Do we have a, what is it? Is it $800,000 or is it something, it is, so $800,000, we're going to give them a grant and we're confident that grant will get paid back. And what are, are there terms on that? We're not, wait, what? Okay. You were shaking your head. No, I'm thinking what you're telling me. It's no guarantee we're getting paid.

Yeah. So the grant is us providing the funds for these capital improvements.

Oh, it's a grant though. So forgive me. Yeah. It's not a loan. It's a grant. We're giving them 800,000 hours. From housing funds. Yes. Got it. Got it. Okay. Okay. Well, that answers that question. Okay.

So essentially Eden housing is like for, um,

What do you call them?

Not realtor, but there are property managers.

So Eden Housing both produces affordable housing. They took over the old South County Housing Authority, which was the affordable housing developer that was in the South County for many years. South County Housing went away and Eden Housing assumed their portfolio. So they assumed this long-term ground lease.

And if I can just add, so what's unique about this property, it is managed by Eden, but it is our property. So hence us recommending a grant towards these capital improvements for really major issues at that facility. And then also, you know, let's not lose sight of the fact that downstairs is a pretty busy commercial restaurant that basically provides a good amount of sales tax.

And then my other question was, obviously Eden Housing is charging us a fee for managing these properties, right? No. No, okay.

If there are no other questions, unless you have a question. Okay, very good. Then very good, John. Thank you for those responses. I'll entertain a motion to approve. I'm sorry. Public comment? Oh, forgive me. Yeah. I'm sorry. Thrown off here. We'll open for public comment. Any public comment on this item?

Yes, Mayor. We have Emanuel Salazar.

Hi, good evening, Mayor. I'm seeing some of the council members I actually met before, so lovely to see your faces again. Hi, my name is Manuel Salazar, and I'm here tonight on behalf of SV at Home. We're an organization that advocates for affordable housing all across Santa Clara County. And the reason we're out here today is to really talk about just the importance and impact that this project has and what would happen if this left the community. So as John noted, you know, Skills Department, it provides 13 SROs or single resident occupant units serving very low income residents, many of whom are on a fixed income. And among those, some of the most vulnerable people in Morgan Hill. While small in scale, this is exactly the kind of deeply affordable housing that once it's been lost, it's incredibly difficult to get again. You cannot in the current market build these kind of units. And if you lose them, that's it. You'd have no more VLI units available. So if you lose these units, it's a desperate, like horrible loss for the city. I also want to talk about how it's located in downtown. So its proximity to services, jobs, transit is a wonderful example of how you can kind of activate economic activity while also providing homes for the people that most desperately need them. And that's a wonderful thing that's really hard to do, and you've been able to successfully do that in this city. So I applaud you, and I do hope that you won't lose these units. The other thing I wanted to talk about was the fact that at this time, this is an aging building with limited revenue that cannot support the levels of capital improvements needed without the public investment. If you allow these units to not go without this investment, they're going to degrade. Residents are going to be living in less than desirable economic and, pardon me, housing conditions. And I've seen firsthand in some of the rehab projects that I've worked on in San Jose that happens, and it's terrible. Black mold, flooding issues. You don't want your residents to have to deal with those things. That's why this action is so important. Preserving existing affordable homes is not only one of the most cost-effective strategies available, it protects prior public investment, avoids significant higher replacement costs, and ensures that these homes stay available to the residents who need them most. This is not only a matter of equity, it's also a matter of fiscal responsibility, economic stability, and maintaining a balanced housing system that serves residents of all income levels. So if you tonight choose to allocate these funds, you are going to be preserving affordable homes that are deeply affordable for people that most desperately need them. Even though these funds are earmarked and you could use them for other housing sources, I'm going to tell you right now, the per unit cost of new construction affordable housing is incredibly high. With $800,000, you are not going to get very far with this. Yes, maybe you could do some sort of site acquisition and do all these sort of innovative ways, but But this money is going to give you the most bang for your buck if you allocate it tonight for this project. So with that, I'm just going to say, please go with staff recommendation. They are wonderful. I've worked with John before. I really respect him. And I do truly hope you will go and take his recommendations to heart. So thank you.

Very good. Thank you. Anyone else?

Mayor Tate, council members, and staff, my name is Sally Casas, and I'm here just to express a couple of things about skills. I actually live there, and what I remember most from some of the building that has been done there when Ladera's was put in. There's a lot of stress that's been put on the building because of that. That's one of the facts that I think has not been talked about. It puts a lot of the pressure on the infrastructure that's there. Also, there was funding in the past, RDA money that was supposed to go for updating and remodeling that building in the past that was kind of funneled to different projects at the time. which are benefit of the community. So I'm not complaining about that. But there are some building structures that were put on the skills more fans, exhaust fans that were put in place on the roof by Ladera's to update their, to rebuild, to build their restaurant. So there's been a lot of stress on the building. And yes, we've been waiting and waiting and waiting for something for the city to improve that building so that we can have a better place to live. Thank you.

Thank you, Sally. Anyone else? More speakers. Very good. We'll close the public comments. And if there are. Okay. Council member neighbors comment time. Yes.

Thank you, mayor. I'm very familiar with this building years ago. It was query brothers hardware and later became an ice cream shop. And then I don't know what it was. And then it was later. But those apartments have been there. They're occupied. Those people need those places to live. And the fact that we would deny this grant. And not update these properties is just horrible. We're going to lose. Very valuable property and I fully, wholly, wholly hope that we will vote to give this grant to the housing authority that is managing it. We get them a new roof. We get them new showers. We fix the plumbing problems. And we keep those residents in their spots that they've lived for a long time. And it's just, they're all a benefit. Those people that live there are a benefit to our downtown. It's close to the transit and shopping, et cetera. And they're all contributing people for our community. They need a place to live and they need a very good place to live. So I totally support that. We go ahead and have to, I'll move to approve this and, um, Also, I guess it could be more confidence on this, but I'm going to move to approve it. I have a motion.

So your motion is to approve the staff recommendation? Yes. Very good. I have a motion and a second.

I just have a quick comment or something that I would like to see moving forward from Eden. I am all about maintaining low-income housing and keeping our residents safe and making sure they have a good place. But one of the things that we'd like to see from Eden is to see how many of our people living in Morgan Hill are being housed there. Like if they have priority, I would like to see some numbers where that, I mean, if you can, I would like to see where the people are coming from. If they're coming from county, from other cities, or they're actual residents of Morgan Hill, because that's something that's important to me. I want my residence house first. And so if we can get numbers, that would be great, John.

or before you move on to voting share this one. Council Member Vega's question prompted something that I don't think we made very clear in the staff report. And so Eden Housing is a nonprofit that's sole mission is providing affordable housing. So it is not, The recommendation is not as if we were making a grant to a for-profit landlord. This is nonprofit housing. And I don't think we made that very clear.

I appreciate the clarification. Thank you. We have a motion and a second. Oh, I'm sorry. Council Member Martinez-Beltran.

Thank you. Yeah, I have no questions on this. I completely support this. It's long overdue. I'm very familiar with the building and this is an asset to our community. It's much less expensive for us to update, maintain, preserve rather than have to go and build new affordable housing. So in my mind, this is the best investment for us to go ahead and do and happy to second. Thank you.

Okay, we have a motion and a second. I think we can do a roll call vote now.

Mayor Turner.

Yes.

Council member Vega. Yes. Liebers. Yes. Iwanaga. Yes. Martinez Beltran. Aye.

That passes unanimously. Very good. Thank you so much, John. We'll now move on to item nine, continued discussion of fiscal sustainability.

All right, good evening. This item is a continuation, really, from our council meeting on March 18th. We're going to be providing an update on fiscal sustainability.

And Vicki, thank you so much. Let's get this queued up here.

I haven't shown her this yet.

Making sure our Zoom participants can see this.

Okay, great. Thank you. So tonight we want to accomplish a few different things. So one is we need direction from the council regarding when and if to pursue a revenue measure. And so as you saw in the staff recommendation, our recommendation at this point based on discussions with the council is to look at fiscal year 20, to look at November of 2028 for revenue A revenue measure. And so we're looking for direction on that. In addition to that, we wanted to share updates on as we're working on the recommended budget that we're going to be bringing forward. We want to share cost saving strategies, cost reductions, as well as revenue areas that we're looking at that will be included in our recommended budget. And then lastly, I want to talk about if council decides not to put a revenue measure on the ballot in 2026 or 28, or if it's placed on the ballot and if it fails, what would we need to look at as far as reductions go? And so we'll go through that as well. And so tonight we have, as you probably saw, several slides. And we don't plan to go through all of these because some of these you've already seen. I do want to say that we did have a budget town hall, and while this chamber was not full with participants and those that wanted to engage with us, we did have a really good discussion. It was really good to hear from some of our community members, not only for us to inform, but for them to engage and get their feedback. So with that, you want to just kind of where are we at? Strong fiscal oversight over the years. We hold a AAA issuer credit rating with SAP. And our general fund reserve is at 47%. And as I said before, this is a good, healthy number, an envy of probably other cities around. But when we look out into the future and look at the forecast, we're spending more. We're spending more than we're bringing in. And so that 47% goes down over time, which states we need to do something in the mid to long term. We continue to be one of the safest communities in our county. And then one other indicator that we like to look at is our pavement condition index of 74. Recreation has one of the highest cost recovery rates and we continue to improve that. And that's one of the things that you're gonna see in this recommended budget is less of a general fund amount there. In addition, wanted to just mention that these budget challenges are not new, but what's sort of newer is the level of inflation and interest rates and the economic uncertainty. Because of conservative spending, higher revenues than were forecasted, federal stimulus during COVID-19, all those things led together to help sort of delay the fiscal decline. And so the ability to meet our robust services that we provide is going to require sustained general fund revenue growth to meet increasing costs. And so, as we've talked about before there's lots of funds we're focusing in on the general fund and so of the general fund there's discretionary there's non discretionary does the ones that we list here are the primary areas for the general fund. And you'll see some charts that kind of separate out our general fund expenditures and revenue for that matter. Terms of dollars, if we look at this fiscal year, our budget is $256 million. But if we look at just the general fund piece, it's a little over $60 million. And so when we talk about the general fund discretionary budget, the $63.8 is lower. It's $45.2. We strip out service fees and grants and program donations. And then about 78% of that does go to public safety. And so by way of a chart, here's our pie chart that we show that shows that the vast majority of our revenue is coming in from taxes. And so you could see that large chunk there, and then the rest is other sources of revenue. And then the chart that we look at that just shows that we're the lowest revenue per tax revenue per capita, looking at all the other agencies in the county. Why are we the lowest? As we've shared before, other agencies have a sales tax measure. We give some examples there. So this is above and beyond the regular sales tax rate. Our neighbors also have a utility user tax. And based upon a number that was established years ago, our Prop 13 base year amount led us to just a lower property tax amount that we receive. And so on the expenditure side, I mentioned this number before, but this is the discretionary piece. What does the council have discretion over in spending? And so this is where we get to our 78% because we're stripping out those service fees and grants and program donations. And so public safety is that chunk there. And then you could see at the bottom, the other areas of spending, everything from admin and general support to recreation. So what steps have we taken? So we, as mentioned before, we knew that this was going to be an issue 10, 15 years ago. And so the team, along with council's guidance and direction and leadership, several things have taken place. An economic development blueprint has been in place since 2017, updated in 2020. As far as revenue goes, we increased the TOT, we created a TBID, we created a PBID, and then we updated our development services fee schedule. And this I'll just take a moment on. This has been a big, really a good thing, especially as we're putting together this recommended budget. Because we updated our fee schedule, our fund 206, which is our development services fund, That's no longer sort of this topic that we spend a lot of time on because we're bringing in more revenue to cover the expenditures because we looked at fees and knew that fees needed to increase. And so that's a good thing. And that will help out the general fund. And then also just business development, looking at ways to modernize our zoning rules to remove barriers to economic development and to recruit new businesses and keep the ones that we have here. Continued conservative spending, that's helped us protect our reserves. And then just cost savings, things that we've done in the past, besides the conservative spending, strategically freezing vacant positions, our new solar project. And then over the last several years, since fiscal year 21, we've set aside 8.2 million to help with some unfunded needs, everything from streets to pension and other post-employment benefits to public safety equipment, as well as park maintenance. So now I want to spend just a little bit of time looking at economic development. And this was something that we were asked to talk a little bit more about. And, you know, what are our economic development targets, you know, as we approach this recommended budget and beyond? So economic development supports the collection of our property tax, sales tax, and TOT. And so that's about 60% of our general fund budget. Property tax is fairly stable, even when there's an economic downturn, property tax is the one area where there's a lag. But even with the economy being a little bit uncertain, we haven't seen a decrease in our property tax. Now, on the other hand, sales tax and hotel tax, those two areas, as council has seen, are more volatile. Some of the other areas that we wanted to just mention is that our investors, what we're hearing from the investment community is they need certainty. And so that's why we brought forward things like the zoning laws that I mentioned before. They need the right infrastructure. And so power is a big one. We're trying to work as closely as we can with PG&E on that. And then just a business friendly approach. They're looking for help in the permitting process. And they're looking, of course, for speed because, of course, time is money for their investments. And so economic development is essential to our fiscal sustainability. But as we know, economic development alone is not going to close our structural deficit. So we are seeing in conversations with the investment community, the industrial commercial is looking good. The vacancy rates are low. And another area that we look at is lodging options. We know that there's insufficient lodging options. And in town, we only have about six mid to upper scale hotels. So definitely a need for higher end hotels. Part of the larger retail trade area is, you know, because we're part of the larger retail trade area in San Jose and then all the way to Gilroy, it limits our ability to attract retail. They're looking for a certain population. And so that sometimes inhibits us. But over time, we anticipate that improving. High construction costs and financing challenges has slowed development. And then I already mentioned PG&E and just power capacity is just a big criteria that our investors look at when selecting where to locate. And then industrial retail and hotel markets are challenged just as much as we are with economic slowdown. So some of the different targets that we're looking at. So one, of course, is the Down Hotel. As Matt and others have shared, the tractor supply company, El Pollo Loco. Restaurants that we'll locate at Hotel Mohai. Our Poppy Ranch Retail Center looking at bringing in sprouts. There is an entitled hotel project at Evergreen Village on Cochran. Looking at leasing the Cochran Tech Center and Butterfield 5 Tech Park. As Matt mentioned previously, conversations are taking place and there is increased interest in those properties. And then the Merchot industrial properties, while there hasn't been vertical development on those yet, they're certainly current targets for us. And then other non-retail developments. And so these Primrose schools and the Learning Center examples of this that support our businesses and there's clearly a need. So in looking at economic development targets, we need to look at our vacant commercial and industrial lands. And so we have about 92 acres of available industrial land and over 100 more or less acres of commercial land. Now, within that, there needs to be an acknowledgment. Some of those properties may never develop and some of those properties may become housing properties. At full build-out, so if we look at all of these spaces that are available, there's a potential revenue that could yield approximately $2 million per year. Now, that's plus or minus. This depends upon what locates at each of those different available lands. So I want to transition now to a newer area in our presentation of fiscal sustainability, which is what to expect as we bring forward our budget to you. So the first is continuing to evaluate non-tax fee increases. And this is It's important to point out these are fees that don't need to go to the voters, kind of like our development services fees. So these are fees for the general fund that we're looking at to determine whether or not we can increase fees above and beyond the annual cost of living or COLA increase that we have. Another area that we are bringing forward with our upcoming budget is implementing administrative charges to the Development Services Fund to support general support services. And this is as per our updated development fee study that I just mentioned, and that's to the tune of about 200,000. And then looking at implementing a rental fee to the enterprise funds for the use of the Public Works Corp Yard. And that's per a study that was completed called the Corporation Yard Rental Analysis Study. And then the next area is implementing the economic development strategies. And then lastly, continuing to look at any sort of grant funding opportunities. Now, on the spending side, what are we looking at as far as cost-saving strategies? Well, one is looking at temporary staffing and overtime costs. And so in looking at the different departments and divisions, we've identified about $125,000 just across the general fund where we can reduce these costs. And then looking at reducing non-personnel costs including just miscellaneous supplies and services across our departments and divisions to about eighty thousand dollars this one was mentioned previously but implementing the new solar project across the facilities and this will lead to savings of five hundred thousand and then the last item is deferring non-essential building maintenance um this is 525 000 And this is one that we are incorporating into the recommended budget. You know, these are projects that can be deferred safely. We wouldn't recommend deferring maintenance that needs to be done. But in looking at the scheduling out of our building maintenance, we believe we can defer about this amount. A couple additional items I want to mention. We've been working very closely with CAL FIRE for our contractual costs and looking at reducing those costs through personnel management, how they staff. And so we're going to bring forward reduced contractual costs there. And then continuing to strategically freeze vacant positions. And then, of course, continued conservative spending. So kind of now looking for a bit at our potential revenue measure just kind of want to lay out if we were to look at November 2028, which is what we would recommend at this point is continuing the Community education and engagement and outreach that would be now through November. Looking at service level evaluations, so this would be absent a new revenue measure and we're going to talk about some of those in a bit. That would be now through June, looking at evaluating revenue enhancement measures. This would be if council asks us, directs us to proceed through the end of next year and then preparing the ballot measure, which would happen in 2028. So now in talking about service prioritization, the council has seen these slides before. We have shared that without additional revenue, it's nearly impossible to make a material impact without affecting core services. And so we go into the different areas. So we go into recreation and community services. What would that mean? Parks, streets, and infrastructure, general government and administration, and then looking at public safety. And we'll go into these in a bit. So based on where we're at, our current economic conditions, our general fund reserve is not expected to drop below our minimum reserve level of 15% until fiscal year 2930. And as such, significant service reductions are not recommended at this time. Now, with that said, we're going to share examples of what significant service reductions would look like. But once again, we're not recommending them at this time. So we engaged the balancing act tool. And so we looked at different categories. I have them up here by area and note that one of the attachments to the agenda materials is a detailed list of all of the different reduction scenarios. And we did revenue as well, but what's attached is the expenditure reduction scenarios And then it also quantifies each of these approximate amounts of what these relate to. And so we have ones related to police and to fire, administration and support, public services. And then now I'll kind of pause for a moment and just kind of looking at next steps. We are going to be bringing forward the capital improvement program to our different commissions. And so it'll go to Parks and Recreation Commission. They're tasked with looking at the parks projects. And then the Planning Commission, that will be done in May. And what they have to look at is to confirm projects. that the projects that are being recommended in the CIP are consistent with the general plan. They make findings and they provide a resolution to that effect to the council for the council's meeting and public hearing. We will release the recommended budget on or around May 1st. We will present it to the council on May 6th, which is we would be walking through it, how it's laid out, what's included, what's not. And then the town hall meeting, which will be May 16th for our community. And then we'll have a budget workshop at a council agendized meeting. And then the public hearing and the adoption for the budget will be in June of 2026. And so with that, I open it up to questions. And just a reminder, what we're looking for this evening is to receive the report, provide any direction, and then provide specific direction related to a potential revenue measure and timing for that.

Very good. Christina, thank you. Any questions by council? Council Member Iwanaga?

I just have a clarifying question. So, and it, it kind of caught my ear when you brought up that you've already, or you were thinking about the future. If you, if you had to talk with the Cal fire, can you specify like, I mean, I hate the thought of. losing?

Okay, so there were a couple things that were mentioned. So one is we had some slides on cost saving strategies. And so one of the bullet points there was related to CAL FIRE and looking at the CAL FIRE contractual costs. And so as we bring forward our recommended budget, we're looking at continued cost savings because they're also sharpening their pencil and saying, OK, how can we staff what positions, you know, not just firefighters, but just even administrative positions, you know, looking at where there could be savings to the city. And so those wouldn't involve a service level reduction. Now, with that said, the balancing act and the and the attachment that shows that significant service reductions that would ponder a reduction in service removing one engine closing down a fire station that's not recommended at this time but we're bringing it forward for illustrative purposes of what it would look like if we did need to make significant service level reductions anyone else council member martinez beltran

Hi, yes, thank you, Christina. I appreciate this presentation, and there's lots of questions that I've had along the way, and so I'll start. But I really do appreciate you going and providing some of the things that I have asked for. I'm very grateful. I know that this has probably been lots of work to look at. I feel like we're now... you know, turning into the right direction. As you know, I was very uncomfortable last time looking at a tax revenue measure without knowing where, what we're looking at, what our situation is, where our revenues might possibly come for or reductions. So I'll start with You you mentioned in here that. I guess i'm looking to see what is the estimated we talked about you were talking about economic development strategies and. That will first i'll start with the non tax fee increases, so we looked at there was the implementing the development fund. and renting out the corp yard. And the other one was economic development strategies. So what is the estimated revenue generation from Monterey corridor and auto that you spoke about?

So, you're referencing potential, bringing forward potential zoning changes. And so, you know, it would just depend upon whether or not we were able to secure an additional auto facility. auto dealership because of that zoning change. And so, you know, that could just range regarding like how many dealerships, you know, and how productive they are in their sales.

So I don't have a dollar amount. Edith, would you or John, would you have an amount?

Not at this time.

Okay, so I would look to get that information. One, where are we looking to put this auto? You say a Monterey corridor. Where are we looking to do that? Are we prepared to? Yes.

Okay.

Thank you. Okay, thank you.

So just to repeat the questions and so we're looking at sort of the zoning and bringing forward additional zoning changes potentially along Monterey for auto and just what would that look like from a quantification standpoint?

Sure. Thank you. Council. Thank you. Council member for the question. I think that we know we kind of have a sense of what an auto dealership would yield in the city. Because we have a couple of examples. We have three auto units that we have a sense of those revenues. Right now, in this particular moment, we don't have any prospects that we're working with. And the industry by itself right now is also struggling. We're not seeing a lot of development. So from that perspective, we don't have numbers that we are in a position to be speculating at this particular stage. The work that has been done to position the city to attract that investment includes the zoning work that we did along the freeway on Cochran. And part of our work program this year is continued to advance additional zoning changes so that when the market changes and shifts our properties as our best position to attract those sort of uses.

Okay, I appreciate that. Thank you. I've just, I thought maybe there was something you were looking at Monterey corridor, but I know we have tenant, we have some over on Cocker, but I just wanted to understand that because if we're putting that in here, I would ask that we have some type of estimation of revenue generation, whatever that might be. So that's one. The next one is which departments are cost recovery? Which departments have reached cost recovery?

That's sort of an interesting question because not all departments have fees, right? So even if you look at public safety and you look at police, so they have expenditures, but then they do have revenue, right? So we have a section of revenue if you go to the budget document, everything from tow fees to other sort of costs or other sort of charges, but that's only a piece of what they provide. You know, so I'm not sure how to address your question.

Let me, that's okay. I can rephrase it. So of the cost recovery departments, which ones are making that cost recovery? Debt.

Yes, for the Department of Non-Journal Funding, we could point out, as Kristen mentioned earlier, development services due to the fact that we just recently updated fee study. So in the past at least 18 months, and we project it to be in the next budget years, the Department Fund 206 will be in full cost recovery.

Okay. Are there any others, Jack?

Uh, um, 206 and the enterprise funds. Of course, the enterprise funds include wastewater and water. But, uh, as for general fund general fund, mainly supported by taxes. So none of none of none of the general fund departments should be, and they're supposed not to be in full cost recovery, except the recreation services that they are training toward that full cost recovery, assume that there's no subsidized or community services provided.

Okay. And do we know what that, where are we at with, how far are we off target with development and recreation?

In the current fiscal year, we budget the department at the net general fund impact of about $1.5 million, but based on the revenue training and SRO expenditures, we anticipate that the net impact will become significantly lower, probably less than $1 million, and continue to improve in the out years as well.

Okay, and that's a million for which one or both?

That's for recreation services.

Okay, and development services?

Development services are currently full cost recovery.

Okay, great, thank you. And then could you tell us, what are the amounts of the top five grants that we're looking to secure?

Uh, that will depend, but in the, uh, in the last few years, we see, and that's especially the teammates have been very successful in, in, um, getting grants approved from the, uh, uh, California Highway Patrol, uh, as well as, uh. The, uh.

Office of Traffic and Safety. So basically they go for DUI checkpoints, vehicles. We've also been successful in getting grants for capital projects and then also for emergency preparedness. And planning. Oh, yes.

And planning, yes. And economic mobility. Correct.

Okay. And I'm assuming that we'll be putting some focus on our general fund expenses rather than capital projects.

Well, so we would always love to, you know, go forward with general fund grants. Unfortunately, most are catered around one-time funding and not sort of ongoing funding now. That's not to say that there's never been sort of ongoing funding. I remember years ago there was, you know, limited term, but still operational funding for, say, fire services, but that's far and few in between.

Okay, great. I'm going to move back to economic development and I want to ask about, in here you have a slide that talked about supports property tax, transient occupancy tax and sales tax. Can you tell us what amount that supports? I'd like to have a target of how much we expect coming in from property tax that economic development is going to influence. Yeah.

So what we what we just put back up on the slideshow here, the revenues. And so what that bullet was stating is that the vast majority of the taxes that come forward are related to property tax, sales tax and hotel tax, you know, is captured by the biggest chunk here. And so, you know, it's through economic development efforts that we bring in businesses and so forth that lead to these different taxes.

Yes, and I think we're doing a great job trying to keep our foot on the pedal. I'm just hoping that we can look at having, again, some targets on how much we expect from economic development to move the needle on property tax, on occupancy tax, and on sales tax, since that's what they're

Yeah, and so I just pulled back up the current targets for economic development. So most of these are commercial and some industrial related. So those will have varying types of taxes. And then in addition to that, we had the slide that spoke of vacant commercial industrial lands and that last bullet stating that at full build out, we're looking at potential revenue of about $2 million per year.

Yes, that's my next slide. But if you'll go back to the previous one, Can you give us an estimate of how much each of those are going to generate in tax, please?

Oh, we don't have that information. You know, some of it, you know, it's easy to pull up, you know, based on like estimates, say for MOHAI, you know, tractor supply, you know, I would imagine that's probably something we could probably get comparables with other agencies, but some of it is, you know, is confidential based because it's just one user. But we could look at, you know, what similar type businesses have. Same thing with El Pollo Loco, but that's not something that we have, you know, ready to go here.

And if I may add, and I know our economic development director is online and he can certainly contribute to the conversation, but a couple of things to think about vis-a-vis economic development targets. The bullet points that you have in front of you is what I think of like fish lines with something on them, right? And projects that we're working so hard not to let them die. In the context of trying to project how much revenue could be generated, some of these projects have been kicking around with us for five years. And even when you look at a shopping center, say Sprouts or the Poppy Ranch Shopping Center, we are not even sure, assuming if we're successful at launching that shopping center and having it up and running, say by the end of 2027, we're not sure how long it's going to take for that project to stabilize. Think about the Target Shopping Center. When it was approved 20 years ago or something like that, it was approved for twice as big of a shopping center. And even today, we have vacancies. So I think that the only thing that if we wanted to anchor ourselves with some numbers that we can actually count on, the only thing that I would recommend perhaps invite us to think about is simply property tax. And I know Matt is here with his camera on so he can also participate. Thank you.

Yeah, good evening, Council. Matt Mayhood, Economic Development Director. I apologize, I'm not with you this evening in person. I'm a little under the weather. Council Member, I appreciate the questions, and I understand you want to get to a level of detail so you understand every dollar that's coming in. I think Edith, you know, says a lot of these projects, you know, They're like a fish on the hook, on the line, and they're not completely finished and they're not fully entitled. They're not open yet. So you can put estimates on things. We are not allowed to share sales tax data on very specific businesses. The estimate that you saw in the PowerPoint that Christina did that showed a $2 million estimate, that exercise was an exercise that John Lang led. because he's an economist and he's really good doing analysis. He looked at the vacant lands, commercial and industrial lands, and we looked at a long-term development plan over 10 to 20 years of that industrial and commercial land. This does not include the redevelopment of existing properties and infill. And these are pretty much properties over one acre. And if you assume, and this is a giant assumption, that these properties develop over a 10 to 20 year timeline at the same FAR, at the same type of zoning that they're currently zoned in the general plan based on historical practice, you're going to generate about $2 million a year in property tax, sales tax, and TOT tax. And that is a pretty rough estimate. It's ballparking it. But that's the exercise shows that economic development alone cannot close the general fund gap. As much as we would like it to. And we're working hard. We're punching above our weight. We got some great stuff cooking. But the economic climate and the headwinds are really, really challenging right now.

Yeah, no. And I appreciate that. I also want us to just for both our benefits, right, to be realistic with what that is. And so when we're saying we have this and it's five to 10, we need to be able. So if it is two million at full build out, which was my next question on that slide, you know, 10 to 20 year. OK, getting some idea. to your point of what that would look like in our two year budget for the next 10 to 20 years and what kind of dent that we could expect from economic development. But I do think it's important for us to have that. And I would like for us to, you don't have to tell us who it is. You don't have to tell us all of their details, but we should have some type of a target, a plan so that things will adjust and change. And I think that that is okay. So I would, you know, I would ask, even if you're looking at that 2 million, sounds like you put lots of work in that from John. Thank you, John. But if we can use that, if that's our target, because we're talking about sales tax and other taxes, then let's go with that so that we know what we're working with revenue wise. And then the last thing I know that my time is up. So I'll pick from the remainder, but I would like to ask about which contracts are renegotiated because that's something that I would like for us to look at is renegotiating our contracts that all of our large contracts that we have with the city and our vendors and looking to see what we can do there. Thank you.

I just want to make a quick comment. I want to clarify based on some of the questions the council member asked. The projections, estimates, guesses, if you will, We're not going to build a budget on that. You can't build a budget on that.

Edith was sort of articulating there's so much unknown in those different prospects.

Right. Now, it's not bad to know what we would hope for in the future, but we couldn't. I just want to make sure I'm clear. You don't build into the budget. potential revenue that we would count on.

I'm not asking to build it into the budget, Mayor. I'm asking for us to have an estimate of what we think that economic, a target, I mean, we've got to have some kind of a target that we can work with.

Okay, no, that's cool. I appreciate the clarification. I just want to make sure that it's not assumed that we would consider that as part of a budget revenue item. Okay, very good. Any other questions by council members? There being none, we'll open for public comment. Any public comments?

Yes, Mayor. We have our first speaker is Doug Muirhead.

Good evening again. Doug Muirhead, still a resident of Morgan Hill. Before I... to give you my thoughts, I do want to endorse the written comments submitted by Cricket Rubino on the budget for the Senior Center. Okay, back to me. Stealing a line from a paper on state water supply challenges. This is one of my favorites. Thoughtful consideration occurs between complacency and panic. The city has reduced the panic by forecasting that minimum reserves will not drop below 15%. until FY 2930. So significant service reductions are not recommended at this time. Staff talks about potential future service reductions identified in the balancing act simulation. Let's be very clear that those proposals came from city staff and are not the result of public input. Balancing act offered a very constrained set of choices with no open-ended suggestions for reductions only for revenues. Stapp's focus was on developing reduction approaches aligned with varying funding levels, a dollar's first focus. What I want our residents to contribute are finer-grained choices, impacts on our community, and a sense that we care about equity and empathy. What do we have for thoughtful consideration? Not the current town halls and roundtables, which are supposed to be community discussions on priorities and strategies for closing the budget gap occurring from now through November, 2028. Just what are the city's performance measures for public partition at these outreach events? The January Mayor Coffee was dedicated to Budget and Balancing Act, attended by two finance team members and the city PIO. Six community members attended, four were known to me. The March budget roundtable that the city manager just mentioned is a wonderful discussion, was led by the city manager and attended by four staff and four community members, one being the local newspaper reporter. I did appreciate one resident saying balancing act choices did not work for him as they did not for me. And one resident lamented the lack of attendees, which I have lamented on multiple occasions. In closing, I want you to join me in saying to the city manager that the level of public participation is inadequate. This item does not get a thumbs up from me tonight. Thank you.

Thank you, Doug. Were you at that January coffee, Doug?

Oh, yeah.

You were there. Okay.

Yeah, I'm quiet, shy, sitting in the back. I understand you guys.

I do miss you, Doug. Thank you. Any other comments?

Yes, Mayor. We have a Zoom speaker, Chris Rebell. Go ahead, Chris.

Hi. Good evening. Can you hear me okay? Yes. Great. So I have two comments. One, actually, I want to echo what... Yvonne Beltran mentioned about the looking at all the contracts. So all the money that is spent, the checks that the city writes to other vendors, partners, whether Cal Fire or whoever. And what can we do to cut better deals, right? Renegotiate or do a multiple bid, rebid them, whatever. I think that's a great idea and probably huge dollars. Second issue, kind of unrelated, but I saw on a previous slide on one of the Balancing Act meetings, which was kind of interesting, that Morgan Hill receives kind of a disproportionately low percent of the county property tax revenues. Um, and so it doesn't really reflect the amount of property tax that, that we, all the owners in this city pay. It's kind of collected at the county level and then it's apportioned out to cities based on a formula from 1979. So I kind of looked at this, it's, it's assembly. So it's not prop 13's fault, right? It's actually assembly bill eight's fault. So there's an assembly bill eight that, that back in 1979, so more than 50 years ago, kind of defined, or whatever, since 1979, it allocates the county money based on the, I guess, population or property values of each city at that time. Well, obviously, Morgan Hill has had explosive growth since then, more than probably San Jose. So we make up a bigger percent of the county than we did back in 1979. So that's totally unfair that we're getting less, proportionally less money than probably San Jose and other cities in the county. So I don't know what pressure, political pressure, we can place on the legislative analysts because Assembly Bill 8 is broken. It's irrelevant and it's way far dated. I don't know a question if I was – maybe the council can consider – you know, lobbying or whatever, the legislative analysts, that's ridiculous. I mean, and if I was living in San Jose, I would say that's not even fair. So to me, that's a huge opportunity, and it's just blatantly wrong, and it has nothing to do with Prop 13. It has to do with Assembly Bill 8 that needs to be changed, and that's in the power of the legislators. Okay, thank you. Thank you, Chris. Anyone else?

There are no more speakers.

We'll go ahead and close the public comment and bring it back for council discussion. Any comments or discussion?

At the beginning?

I have a comment.

Council Member Liebers first.

I just want to say thank you to all that worked on this. I think it's very clarifying what we're looking for, what we're looking at. And it gives us time to reflect and get more information back on some of the questions we asked. So I understand this is extremely time consuming project because there's so many T's to cross and I's to dot. So thank you. And I found it very helpful tonight. We need a lot more information, but we have time. And the fact that we're ahead of the game right now today, is very positive. So thank you, staff.

I'm sorry. Sorry. Christina, based on the previous caller and his comments on Assembly Bill 8, Any thoughts on that? And is there an opportunity for?

Yeah, I'm not familiar with the eight. So, but that and I'll look at that. We're not, that's not our understanding.

So, okay.

I mean, if there's room, I, yeah, I mean, we'll, we'll follow up.

Okay. Okay. Very good. Thank you for that. Council. I'm sorry. Council member.

Yeah.

I think council member Martinez Beltran.

wanted to see, Christina, you said that the budget will be released May 1st, and then we will go over that. We'll see that at council on the 6th, and I'd like to see if we could get that earlier than the 1st. Is there any way to get that a week earlier and put that out so that people can be having a look through this?

I wish there was a way, but you know what? The budget calendar is set out And as much as we'd love to put it out sooner, there's so much that goes into compiling the document that we're working feverishly, I'll say, to achieve May 1st.

And may I add that even though we won't be releasing hopefully by May 1st, by May 6th, we won't be dropping too much of the detail of the budget, rather for like a... navigation type of thing that tell the public and council how to navigate the budget book. We won't be discussing detail until the budget workshop schedule for May 20th.

And the good news is it's one month from today. That's helpful. Thank you. That is very helpful. Thank you.

Christina, let me ask this. We at some point, we're going to get into a conversation around what is it we are looking for as far as a tax measure or other whatever else there might be. But it's coming down to some some form of a tax measure. What what is it? When do you need from a staff perspective need to know from us? What it is where we're going to charge.

Yeah. So, if we're looking at a measure in November of 28, we'll want to assess from council. Like, if there's a majority of you that don't want to look at a specific kind of measure that's off the table, then we pull it off the table. But if there's a broad interest in different types of measure, we'll come back with a recommendation, but then we're going to recommend that we. do a you know a survey a poll where we have you know look at what is the likelihood of different types of measures you know being approved by by the community you know because that will provide you know intelligence into you know what what November 28 could look like.

Okay because I still personally feel very strongly about a public safety revenue measure and I know that there's plenty of other considerations and conversations that we'll have. I just want to make sure that we don't keep kicking us down the road to the next meeting and next meeting. And at some point we need to, we need to have a conversation about here's what we want you to research. We've got to narrow it down to two or three and then let the staff go do their thing.

And there was pretty good conversation at the council probably a few months ago about even looking at a few different measures on the ballot. And that's an option too.

Okay. Okay. Council member Martinez-Beltran. I think you're on mute.

Thank you. I also only just wanted to highlight, I would like to see it our next one. I didn't see any detail on staff on, you know, worst case scenario, what cuts we might have to do. We talked about services, but what staff would that mean? that might have to face something if this tax revenue measure doesn't pass, if it doesn't go forward. And I would really like to have everybody have that heads up and understanding. So if we could also address that with the targets that we talked about, and also I would really like for us to look at that. I still feel like that's something that just has not been discussed or talked about at all. And I do not want anybody caught by surprise.

Very good. Thank you for that. There's no action to see. We have public comment. We're back. There's no action on this item.

So we have just receiving this report and just looking for direction that we should proceed if we should proceed for a November 28 measure.

Okay. 2028. So that's what we had talked about last time that we were going to let them know because we said that doing it this next election will be too short. So we wanted to push it back to 2028 because it will give you time to do the polling and give us options and all this other stuff. So that's something that we can do.

Right. Do you need a formal...

on that or just sort of it's not on the agenda for a formal okay so you're looking for direction and i would say we're probably on the consensus that we would be looking for something on the 2028 ballot is that yes yeah yes go ahead i definitely do not i still think that i need to see these that i'm what i'm asking for and some some numbers before we're going to ask people to dig into their pocket

which is fine. The rest of us are thinking that if we're going to do one, it's not going to be on the 2026 ballot. We're looking at 2028. So yeah, we haven't had to decide. And good point to you that we've not decided yet on a tax measure. But if we're going to consider one, it's going to be looking at 2028.

Yeah, thank you, staff, for the report. I think you guys did a great job. And it was helpful to me to have that potential future service reductions you know, kind of spelled out for me. Sorry, I'm a little tired. I'm starting to fade out, but it is something that is important. And I think 28 is a reasonable amount of time for us to, you know, dig a little deeper. But as far as the request to look at contracts, I mean, that's something that you guys do anyway. We're always having you come to us with, hey, there's a contract coming up for such and such. So it seems a little redundant to go through everything all over again, since you're already doing that anyway.

As part of compiling the recommended budget, we ask each of the department directors to look at their budgets and to look at where can we possibly save cost with this budget, not in the future, but with this budget. And so that's where you see some of those costs that I mentioned that we're looking at saving for this recommended budget.

Right. And I just want to add one thing. I would caution for us to jump ahead and say, hey, if this happens, then, you know, this department gets cut or that one gets hit. I just want to caution that because that can lower morale really, really quickly. I know when those rumors go around at the hospital. It does bad things to everyone, right? Whether it actually happens to our department or not, it plays with us psychologically. So I would just caution us to not sit here and jump ahead and say it doesn't happen.

And I appreciate that. On the attachment, you'll notice caveat language, you know, that it's for illustration purposes only. future consideration. And yeah, I mean, I've told this council before, you know, we have a great workforce and retention is probably my number one priority and making sure that we have good talent working for us to achieve all of council's priorities, knowing that we have to, you know, maintain fiscal sustainability.

Very good. Council Member Vega first.

I know you don't have a magic ball and there's nothing you can do about it, but just hearing that only four people came to our last input, it's really hard when you're getting four people's opinions to come and say something. So I don't know what we can do to make sure that the community comes out, they understand why this is happening because four people is not speaking for themselves. for our community at all. And so, I mean, and then when we're going to do our workshop again, and we only have four people in the audience, it just makes it really difficult because when we make decisions like this, obviously we get a lot of dislike comments because we made decision, but if, what can we do to make sure that the community engages? Can we just look into that just so that way we have, you know, make decisions and they're here and they can, give us input or they can tell us also what they're looking for.

Council Member Martinez-Beltran.

Thank you. I think I'd like some clarity on what it is that you're asking us to decide tonight. Are you asking us to decide we're doing a tax revenue measure in 2028 versus 2026, but we are doing one?

Yeah, so we're in April of 26. And so if this council was looking for us to look into the feasibility of doing a measure this year, then that's something that we need to act quickly on because there's a lot of steps that need to take place. And so what the recommendation is, is to provide direction and we're recommending that it wouldn't be before November of 2028. Now, bear in mind that it's just providing the direction to continue going forward, which means bringing forward more information about potential revenue measures, looking at maybe hiring a political consultant and or doing polling. In addition to that, as we know, we have an election in November of this year at the local level. We have three seats. The council dynamics may change next year. And so there's going to be new decision makers and those decision makers are going to be the ones that are actually going to be approving to actually put a measure on the ballot. And so it's just next steps in the direction of November of twenty twenty eight.

Okay, so in order to decide whether it's 2026 or 2028, I guess that's where I keep coming back to. I'm trying to understand how this council is deciding whether that goes in 2026 or 2028. And I'm interested to hear why that would be. And then, you know, I'll just say, as I've said many times with the staffing, of course, you know, we always work to do retention with our staff, but I think also morale is to let our staff be very transparent with them. as far as where we are. People have family and obligations, and I want to make sure that they have a full scope of what's going on and where we might be. So I think that, you know, kind of keeping this under the rug is not the way that I like to move forward. I like to move forward with transparency so that everybody understands kind of where we're at and what we're looking at. And so that's why I keep asking, you know, if there are to be impacts where that might be so that we can understand, you know, what services would we lose, which means that this department would be impacted so that we can talk and explain and have those conversations with more than just, you know, people who are coming to the formal setting. I mean, there's five of us who are all throughout the community. And it's really important that we're able to have that information and share that information. So a couple of things, if I may, Mr. Mayor.

Yeah, real quickly. I just want to comment first regarding, and I know we keep asking how we're deciding a tax measure on 26 or 28. We're not deciding anything other than we're not going to go forward with trying to do something in 2026, which means if we're going to do something, it's in 2028.

We had this conversation. What's the measurement?

Well, because there's no time. There's really no time to try to get this figured out. I think there's still greater conversations that we need to have to decide whether or not we're going to do a tax measure. And if so, what is that tax measure? We're not going to get that done by the timeframe needed for 2026. Right.

Can I just jump in? Because we had this conversation, I think the last meeting or maybe two meetings ago. And I think there was only two of us that were pushing for the 2026. And it seemed like a pretty strong three to two vote not to proceed with 26. So here we are talking about something for 28.

If again, if. And why is that?

Why 2028 versus 2026? I think it's why. Not who or what, but why?

We've already addressed that and we're not gonna go over it again. Christina, if you've got some comments.

Yeah, I wanted to make a comment on the attachment. So council asked us to bring back information on potential service reductions. And so that's attached to your packet. There are dollar amounts. Many of them do reference staffing and staffing levels and actual positions that would be part of that. Now, I wanna caution the council I want to caution the council that, one, we have been very transparent. We just finished negotiations with our bargaining units. And so we lay out at the very beginning and throughout the process where we're at fiscally. And so our bargaining units are watching this very carefully. And as I started off this conversation, we have a very healthy reserve. And so in our best recommendation and in all prudency, We are not recommending significant reductions at this time or sending signal lights to our staff. We're going to recommend them at any point in the near future. And so I caution the council in making rash, knee-jerk decisions on something that doesn't need to be done right now. And if we felt, and I've said this before, if Dad and I felt differently, we would be here tonight telling you otherwise. But I would caution you from a staffing perspective, because we are a people organization. We need to be very careful on how this is messaged to our team.

Yeah, and I don't think at this point we're telling you to come back with recommended cuts to staff. We're not looking for that right now. There are some greater conversations we need to continue having. One of those will come to the point of, if we're going to do a tax measure, what are those options looking like?

Right. And I, you know, Mayor, I want to address, I mean, we've, if we're saying it's because of time, we've been talking about this for over a year. And so to say that it comes down to being about time just doesn't really, you know, measure up. And I guess my caution and my worry is I've been on this council for a while and I know what the polling has been. And I, you know, see what where it is now for a tax revenue measure. And that's what makes me so nervous. And so while I understand that right now is not, you know, a scary red light, I get that. I looked at the reserves. I'm very familiar, as you could tell, with the budget, but I we are gonna need to take some action. And if that action doesn't happen, which is very possible, very possible that that will not pass, whether we put it on the ballot and the voters choose not to pass that, that is something that we need to be really thinking about. And I would rather be thinking about that early than later. And so that's my caution.

And duly noted, thank you for that. If there's no further discussion, we are going to move on to the future council initiated agenda items. Do we have any anybody with a future initiative? Yeah.

So, I have to 1 of them was, if there's a chance that we can review our current inclusive housing ordinance. And then the other one we've been... And that's coming up.

Okay. So I sent out an updated list today of all the requests that we've received that we need write-ups and then also ones that are coming forward. And so that's towards the bottom. Okay. That we'll be bringing that back in the next... I can't remember the date, but it's in the next several months where we will be bringing that back.

Okay. And my other one was we're getting a lot of... outspoken people about parking, public parking, and people are parking in their space where they can bring the garbage, blocking spaces. Is there any way the city can mark the streets? So, I mean, there's times where there's one car parking where they can have three.

So we are actively engaged between development services and public services and police on that very issue. So we're proactively working on that and looking at hosting a community meeting and looking at all sorts of solutions because we know it's getting kind of ugly.

And is there alternative parking spaces maybe that we can temporarily find? We'll look into that. Okay. Thank you. Thank you.

Can I ask something for future? I don't know if this would be an agenda item, but I wanted to find out. I've been walking my dog a lot downtown just and shocked at how fast people are driving through, including city buses. So is there any future movement? Or I know at one point we talked about maybe some cameras that would catch speeding.

Let me just real quickly, if that's a future agenda. Yes, can you do that? You need to stay. I would like to talk about.

I would like, sorry, I'm brain dead now at this point. I would like to talk about maybe looking at how we could enforce the speed that should be happening downtown on the next meeting.

Not on the next meeting. You'll submit it. Very good. Very good.

Okay.

Oh, you got lucky.

Council Member Martinez-Beltran.

Thank you, Mayor. I would like for us to bring back and look at our contracts and have some kind of a baseline in reviewing those for each department so that the department heads do not have to decide which ones do or do not. And we can just take the impartiality out of it. So I'd like to look at our contracts who we have coming up and discuss that.

Very good. There's no other discussion or we will adjourn the meeting. Thank you.