City Council - Regular Meeting

Good afternoon, good evening. It is 5 o'clock and I'm going to call to order the work session for the Pflugerville City Council on this Tuesday, June 9th. With that, we'll move into our second item on the agenda, public comment. A member of the public may address City Council regarding an item on this agenda. Comments must be relevant to the agenda item. Citizens wishing to speak during work session shall submit a completed speaker request form to the City Secretary. Before the work session begins, each speaker is limited to three minutes. Trista, do we have anyone signed up? Thank you for that. Moving on to our regular agenda, item 3A is a discussion regarding fiscal year 2027 budget preparation and budget assumptions for general fund, Pflugerville Community Development Corporation, general debt service, and hotel occupancy tax fund. Looks like we've got our finance director, Tracy Waldron, here.

Yes, good evening.

Always good to see you.

I'm happy and excited to kick off this budget season. Even though we're kicking off the process tonight, we've been working on this for months, starting with the retreat with council in January. So lots of months have gone into all of this information. So agenda tonight, we'll be covering property values, tax rates, debt service funds, sales tax, general fund assumptions, hotel occupancy tax, and PCDC. So on the property tax value, I really like to reiterate these are preliminary. So even though I'm giving you a number, it's a preliminary number. But it does consist of new valuation revenue of $262 million. That's compared to previous year of $159 million. There is an increase in how much the TERS will capture on any increase in valuation at $132 million. And loss in personnel property exemption, $74 million. We call this out because we have talked about this, and we even had the tax assessor or Yes. Give us an estimate last year on what she felt like the amount would be. That amount was $209 million. So I did reach out to her when we got the $74 million to say, you know, that's a pretty good gap. And what she explained was that they were able to group some related properties within the law to reduce the impact of the loss. So that is all good news for us. But as you can see, the total valuation is showing a decrease on the preliminary numbers. So as we had been experiencing pretty good growth over the years, slowed down a little bit the last couple years, we're actually showing a negative growth this year. So just keep all of these things in mind as we move forward. So from a dollar perspective, the maintenance and operation portion of the tax, which supports the general fund, we budgeted $29 million for fiscal 26. The projection is coming in right at about $28.7, and our preliminary projection is $29.7. This is an increase of $639,000. in revenue over fiscal 26 budget. We will be receiving the certified roles around the 25th of July. Usually I see them a few a few days earlier than that, but that's when we'll get those preliminary numbers, those final numbers, and we'll be able to run those final rates. I do want to point out with the valuation going down, it's very likely that when we do run the no new revenue rate and the voter approval rate that we will see the no new revenue rate rise. That's just how the math works. The tax calculation allows us to receive the same revenue year over year from the same property. Just kind of looking at the process, so we've received the preliminary evaluations. When we do receive the certified, we will send everything over to the tax assessor, and they will calculate the rates. The governing body will propose a rate by motion on August 11th. We'll hold a public hearing on September 8th and adopt the tax rate on September 8th. So just kind of reviewing the truth in taxation process. This was created to create more transparency. So the taxing unit, we will have to publish our new revenue rate and our voter approval rates. All of that will be available to the public. And there will be special notices and there will be one public hearing held during this process. And the last bullet just identifies if we were to approve or want to approve a rate that's over the 3.5% M&O growth increase, that would require an election. Two parts of the tax rate, the maintenance and operation, which is our general fund portion, and the debt rate, which is the INS rate. And so the no new revenue rate, which will be calculated, is just basically that. It's the rate that is calculated from the same properties year over year. As I always say, it's not really that simple. There's a lot of things that go into that calculation, including lawsuits, exemptions, all of those things. But this slide makes it look really simple. The voter approval rate is the 3.5% over the no new revenue rate. That is on the M&O side. I do want to point that out. The debt rate is calculated straight from what debt we are going to owe the next fiscal year. So in that... The property tax revenue generated for the debt service fund, which is the INS rate for fiscal 26, we budgeted a little over 33 million. We're projecting 32.8. The preliminary numbers are 32.7. I did want to point out that in the calculation currently, we are using 4.85 million. to basically stabilize the rate and bring back the same rate that we stepped out with in fiscal 26. So we are using available fund balance. The total debt is going up by $1.3 million from 26 to 27. That's with no new issuance. That's just the way the the debt is currently structured.

How many more years can we do this? Because I'm having a, you know, let's have a frank conversation about it. I mean, we're trying our best to make sure our citizens are able to afford the houses they're in right now, make sure that, you know, we understand what the state of the economy is. But at the same time, we keep using those funds to to keep that at that level at some point, we're going to run out of those funds. And that's where my concern comes from right there as well. And I think that, you know, I say it every, you've heard me say it every year, Tracy, like this is one of the most important meetings we have to just explain to the citizens, here are the facts. You make from what they are, but this is what we're trying to do to make sure that your lifestyle, your convenience is as best we can possible here to manage this.

Yeah, the only change would be the valuations, which we don't have control over.

Can you take me back one slide real quick? Okay. You said that the debt service, our costs are going up 1.3? Mm-hmm. Okay, so we're collecting 32.7, but really it's costing us $34 million in debt service.

I think it is about...

Roughly. Okay. It looked like... I was confused on the next slide with the way the bond chart landed.

So our debt service in totality, the way it's calculated, I think this is just the INS portion of the debt. So our debt service will include debt that's covered by other sources like TERS and... because we have to include all of that debt in that service, but you'll see that revenue come in to offset that. So the tax rate is only covering the INS portion of the debt.

All right. And the dollars that you're using to offset the rate here, how much is left after this?

I think we still have about $5 million.

So in theory, we could do this again next year, but then we're going to see a follow-up.

A couple of years is about all we'll... The only thing that will change the calculation is... I can't change what we've already stepped out with for debt, so that's not changing. Really, the only change is where the valuations fall.

Or if we refinance some at better rates.

Yes.

Which depends on the market.

which I did reach out to our financial advisor just to see kind of where we were with the refunding. We're still old and steady.

But this is a great visualization. Thank you for putting this together.

So just to clarify, the fund balance in the debt service fund can only be used for debt service, and we do not have a policy to reserve any in that fund balance. I don't believe so.

Correct me if I'm wrong, Ms. Waldron. My memory is that we have currently, right now, with all of our outstanding debt, we have very competitive rates. So we don't have anything that we're paying more than 5% on, do we?

I would have to go back and look. But I do believe we've gotten very good rates when we've gone out.

So it's... Unless we go back to the 2020, 2021, you know, rates are almost zero era, it's unlikely that we're going to get into that situation where we're going to save a lot by refinancing. Is that right?

I mean, we're still looking at doing a refunding this year. It may be reduced as to what we can refund based on the savings that... we can get, but yeah, it's getting kind of tight. It's, it's not that market anymore.

Okay. Thank you. And that's the, and that's the conversation we have with the citizens. I think we had a good conversation. Um, I'm tired. What was that y'all site? School board. Um, uh, about that, about, um, you know, where the growth is, how that's occurring, and how we manage that with the expectation with our citizens. Because I think some people think that we still have that opportunity. So we're, you know, 2017, 2018, 2020 or so. Others, they're feeling it. And so while they're feeling it, we also have to explain to them that everybody's feeling it. Like all these entities that are trying to service you are feeling it too as well. And it doesn't look, what did you put it, David? It doesn't look too clear in the next couple of years that anything significantly is going to change one way or the other regarding where the trend lines are going right now.

Right. So that takes us to our other positive topic, sales tax.

So we budgeted 20.3 in 2026.

We're projecting 19... And we've built this budget flat. We're keeping it 0% growth over fiscal 26's projection. We feel like this is the safe thing to do. I will say I really wanted to dig into the numbers. Anytime they do audit credits on sales tax, it really throws our year over year evaluation. And so the software that we use did allow me to strip out the audit and just compare year over year. And when you do that, we actually do have a 3% increase year over year. Which is good because that's current collections year over year. So I feel like that's a nugget of positivity. Even with that information, we're not going to budget more than 0% increase. But I was glad to see that.

So there was a sales tax audit where... sales tax was actually reduced rather than... We've had it go both ways.

There was a large one last year, which means every time we compare last year to this year, it looks as though we're negative on the growth. But if you peel that audit out, it's really a 3% growth year over year. Just a chart to kind of note that.

So is the audit credit in like the February time frame?

The February is Christmas. It's December. Yeah. Yeah. I want to say it was in May. What? So on general fund, we're providing a fund summary. It's a very high level. We're projecting that at the end of 26, we will have $19.8 million in fund balance, projecting $65.3 million in revenue, and about the same for expenditures. We are looking at using some of our available fund balance to transfer a lump sum into the Vehicle Equipment Replacement Fund. We've been working with fleet and with all departments to review our fleet and equipment schedules and we feel comfortable with the 1.6 being able to replace the fleet and equipment that needs to be replaced. We're still looking to refine that number. It may change a little bit by the time we get to proposed just based on...

Refined up or down?

I know there's a piece of equipment they're going to give me, so that might go up. But I was going to say down, too, because we need to factor in the sale of what we have. the auction of vehicles that we have, and also just interest in the fund. So this is a new fund. We're still building it out and figuring out what it's going to look like long term. And then we've got a list of capital outlay in one times, which we will cover in another slide. So after all of this, it brings us down to 27% fund balance reserve, which we're still very comfortable with. Our policy is 25%.

Can we back up a little bit? I want to ask you a couple of questions about the sales tax estimate. Because obviously that's a critical piece of all of this. So I was looking at the comptroller's website earlier today. Of course, Rudy, Councilman Matera, worked there back in the day. And the biennial revenue estimate at the comptroller's website suggested a 3.9% increase in sales tax collection in the state over next year, which is down from what it was this year. Now, part of that is based on population growth. So if you throw that out, we're still looking at the state estimate of somewhere between 2.5%, 2.7%. sales tax growth. And I'm wondering why you think that Pflugerville sales tax growth is going to be so substantially below the state projection.

Well, didn't you say 3%?

Our year-over-year is only 3%. Last year was a 3% projection. No, no.

She said this year.

This year.

It's 3% except if you take out the audit. collection which we had to give money back.

Yeah.

Unless it was a one-time thing.

0% over FY26. She's just being conservative.

So it's we could do it a lot of ways. But I would caution us to step out with too much of an increase just because of the trend that we're seeing. Even though I think some of that trend is related to audits. It's strategic, so if we build the budget and balance it based on an increase in sales tax and it doesn't materialize like it did this year, then, you know, then we're looking at, I mean, you can see the projections for, let me go back.

I understand the small C conservative approach. I'm just curious as to what what is underlying your assumptions about what the growth is going to be?

What we're seeing this year.

So it's local what we're seeing this year as opposed to... And we're substantially below the state growth in sales tax.

I think our year over year we are in a negative.

But the year before that we were above the state average. Do you know why there's a Do you have any explanation for that?

Every jurisdiction is very different in how they grow, who's affecting that growth.

Tracy, I'm curious. When you're estimating sales tax, do you work with our planning department to understand any new commercial entities that are coming online?

I definitely reach out and see if there's anything. If it's not something that's going to be a large sales tax...

I mean, a Costco or a Target or something like that. So you're not seeing anything that would move the needle on sales tax that's new development. It would purely be, I'm going to call it inflationary growth.

Right.

Because part of the conversation, David, because of some of the boards I'm on, I'm paying acute attention to what's going on in Austin and their budget and what's going on with that aspect. Austin's having more problems than we are. It's that way for everybody. Like, I mean, Central Texas in general, this is what you're looking at. And that 3.9, that projection, I'm guessing that's some of the more substantial entities that are going on in and around the state and other different regions to help compensate for that. It made sense to me because I thought about it when I saw the 0%, but what Tracy was saying is that because we finally have the software, thank you, Serena, to actually go ahead and look back on these things that, Actually, we really do trend with 3%, and we have been, even when you take out the stuff for audits. But I just, given how things are, I'm comfortable with zero, just so it's like, okay, listen, if we get something on the back end, Merry Christmas, right? We get a surprise on that. But in general, it is, I mean, it's why, I'm not going to name names, but certain entities that were antagonistic to businesses before because I think this council has proved time and time again there can be a win for business community as well as for the public have changed their tune because it's this is what we're looking at and we're looking at that I think the projection what is it so we're going to 2027 I think it's that way until close to 2030 is when they think it's going to pick up so it's rough

So going over some of the highlights of the general fund, on revenue side, on the increase side, we will have an increase in property tax, which should be pretty much just the new value that we're gaining. There is a transfer of tree escrow funds. That is offset by expenditures that are one-to-one, so I just want to point that out. Same with the Travis County EMS. We've built that in, but we've also built in the increase in the contract itself. So that's a one-for-one change on that. On the decrease side, it's budget-to-budget, which is what I'm calling decrease. Sales tax would be budgeted lower than it was in 26. Interest is less, and recreation fees will be less for the general fund because some of that is being reverted over to the Monarch Enterprise Fund.

That makes more sense. I was like, wait a minute.

Calling out the differences in the fund.

The overall revenue for recreation we expect to go up, but it's not going into the general fund.

Say that again.

I just want to make sure I understand that correctly. We expect the overall revenue for recreation fees to actually rise, but it won't go in the general fund. It's going to go into the Monarch Enterprise Fund.

Correct.

I don't want anybody to look at that and say, wait, we're building this new center and our income's going down. No, it's not going down. It's going in a different bucket.

Correct. And we're not covering the Monarch tonight, but it will be on the July 14th.

Okay. Part of the way we're saving money is that we're having Cesar show up at 6 a.m. and open the place and make sure everything is open. Thank goodness.

Perfect. So some of the first... No, they're going to be there all night as well.

Some of the personnel highlights, total full-time equivalents decreased by 20 in the general fund. 15 were transferred in from utility fund. This comes from a reorg of our public works departments as a whole. So just for an example, inspectors were kind of scattered across several different departments, including some in utilities. We've centralized those all under one umbrella. So we physically moved those positions to the general fund. Then 15 positions went out of the general fund to go over to the monarch. And then nine vacant positions were eliminated in the budget. They span from multiple departments. It's not any one department. And then there was one vacant, there was one position that was moved to a vacant position in another division. So that's your 10 eliminated positions. Cost estimates, we do have a 3% COLA built into the budget, and we have an 8% employee health insurance cost in place.

May I ask just for clarity? It's been a long day. When you say 10 eliminated positions, are those people or positions?

They are vacancies. They are positions, but they were all vacant except for that one that I mentioned.

Thank you. Quick question on insurance. How much did we, I know this year we were anticipated to be pretty bad. How much did it actually go up?

We don't know.

Okay.

Which is why we always have to estimate.

Oh. Our insurance runs on that. Yeah, this past year.

We stayed within the amount we budgeted. So I think we did a 5%. And when it came in, we were able to make a few adjustments and keep it within the amount we budgeted. So on expenses that increased, the obvious one that stands out is any expenses associated with our new facilities. So utilities, janitorial services, property insurance have all been estimated and put into the budget.

How much is property insurance?

property insurance? Yeah, how much was it?

I mean, it's a big old building. It's a new facility. I'm kind of intrigued to see how much it was.

Insurance has gone up extremely.

I feel like insurance on a new facility should be less than insurance on

The facilities that were coming in. I hope that works out.

I hope that works out.

I remember off the top of my head what the City Hall quote was. I don't remember what the Public Works one was. I think the City Hall one was $118,000 for a year's worth of premium. Okay.

Oh, yeah. Like, can't we get a Jeff Coleman?

So the emergency medical services in the proposed budget, it was at 1.3. It is now 1.9 in the budget. Computer replacement. So we kicked the can last year. We took all the computer replacement out of last year's budget in order to get a balanced budget. Obviously, we cannot do that two years in a row. And so we are putting... the necessary replacements back into the budget. And I'll talk. We kind of split it up. We were given what we should have done last year, what we should have done this year. What we need to do in fiscal 27, we have placed in the operating budget. The catch-up from last year, we're actually putting it on the one-time capital list. So we'll cover that when I get there. Citywide software, it just in general, like someone was like, well, what is it specifically? I mean, there are a few new asks, which we always evaluate and make sure that it's needed, it's not being duplicated somewhere else in the city, but also just a general three to 5% increase on software is pretty much a standard with any software. And we use a lot of software. I will say the software that finance uses, I mean, saves a lot of time for us.

Well, that's the catch-22, right? We use a lot, but we, for years, we've been asking for a way. We always have data. How much actionable data do we have? And you just gave a perfect example of that when you were talking about what our actual sales tax was. So we use the actual software to be able to calculate that and get that.

And then cost allocation, you'll see an increase in that. Part of it is when you peel the Monarch out and now it is not a part of the general fund, there is a cost allocation to that enterprise fund. But also just some of the restructuring with utility fund, that cost allocation has changed as well. On the capital on one-time requests, this is the assumption that we are using available fund balance for these purchases. Our senior advisor, the computer replacement prior year, so we split those up. Computer upgrade for engineering, so this is an upgrade to much faster computers for several of the engineers in order for them to run a particular software that allows us to not have to consult that out. So it made a lot of sense to bring that in-house. Old Town Playground Replacement.

Hold on, I want to back up a minute there. When I saw that about computer replacement, I'm like, well, how often are we doing that? And I'm thinking that there's obviously the need for that is greater in some departments than others. Engineering, for instance, I would assume that they would be replacing their computers more frequently than a lot of the other departments. Finance would also, I would think, would be one where

I think it's the computers might be different, but the replacement schedule is usually around the five or six years. Is the replacement schedule the same in every department?

Yeah.

I mean, I'd have to defer to our IT department. I don't have that schedule, but whatever they step forward with in these computers are up for replacement. It's every five years.

What?

Every five years.

Five or six.

Is it an every five-year replacement?

Generally, I'm under the impression we run a three-year warranty, and then we hang on to it a little bit longer than that. If it fails in there, we maybe have to replace it early, but our goal is five years. It makes me feel any better.

I've had this iPad for like seven.

I've had this laptop right here for four. I was just wondering... You know, what's, is it a three, is it a five, is it a three? You know, and I know some people, you know, replace every year. Yeah, I do believe we're on a five-year term. But I was just curious what our speed of replacement is for that. Is that a policy that we established?

I believe I've seen that policy come across our desk before. That is a policy we established. I'm curious about the Old Town Playground replacement. Do you happen to know how much that is?

It was $200,000.

Are we replacing equipment there when we're also considering making this a new park? Am I in line with the question?

That would be a question.

I think that's a question for us.

It's okay. You can pause it. I think I just wanted to make it make sense for myself.

Who's this random guy with the beard coming out? This guy looks like he's here to replace some playground equipment.

So we did a master plan, if y'all remember, for Old Town Park. And we've kicked that pretty far back into the CIP because of some feedback we got from y'all and the feedback y'all heard from the neighborhood. Old Town Park is the playground at Old Town Park, so we're 20 years old. There are a lot of cities that carry a lot of deferred maintenance. We do not. As far as the Parks and Rec Department, pretty proud of the fact that let's say like Austin has close to a billion dollars in deferred maintenance in their park system, and we have probably 25 benches or picnic tables that are still wood, and this playground that's over 20 years old. After that, the playground at the lake is 16 years old, which will be taken care of in the next round of the lake improvements, and I don't think we have a playground over 10, near at 10 years old. So this would be $220,000 or something like that. And if that is the will of council, that we abandon the master plan and we go back to just replacing this playground, that's something I think we have shown that we can do pretty well. If you want a playground in a shade, something unique to that neighborhood with maybe a trail around it, and it's not this... It's not this connection of this space over here, which is the old water tower and this really unique thing that's different and one-off than anywhere else we have in the city. If that's no longer the interest, then we just need to deal with the fact that we do have some deferred maintenance left. It is that playground, and it's whatever the staff put in.

Thank you, Shane. I wanted to say with that, do the residents that live over there know that we have paused that?

Oh, yeah.

They do now? Oh, yeah. I haven't talked to each one individually. I think some do, some don't probably.

Okay. I mean, I think some people, they would be happy about that. And so I'm excited to know that we are still not abandoning Old Town Playground where I used to take my preschoolers to play because it was quiet. And there was no one there. So I loved it. But it is good to know that you're going to do a playground replacement. And if and when, because there still should be something there, we decide to move forward. Can any of this replacement items be used in the cost and worked in...

Absolutely. Yeah. The conceptual plan would be altered to acknowledge the fact that we've updated the playground and maybe it's now not a pavilion with a restroom. It's just the playground's already there and there's this trail connection and maybe it still goes above. Maybe it doesn't. Maybe you're still bearing the power lines. Maybe you're not. There's still a way in the future to do this playground request. and to take parts that are maybe still palatable to this board and anybody in the community and make this one unique space and kind of highlight what that water tower meant for this community a long time and this playground. It doesn't have to be the thing that ultimately came of that study to still see some sort of improvement over there.

Thank you so much for that. And I think it's really important for the residents of Old Town to hear that you heard them and that we have pivoted at this time. So I'm doing a Rudy, just making sure we state that for the four that are actually listening so that they can go out and get the word out. And I thank you still for giving attention to this particular area.

I'd like to go back to 2020. At that time, Councilman Marsh through, well, he had some opposition.

Strong opinions.

To this, because in his words, I live there, I pass by it every day, and as long as I've known, there's never been a kid playing in that playground. His argument was, do we need to spend the money there now? And I'm channeling my Councilman Rogers and Ryan, do we need to spend the money there now if it gets so little use?

But if we say that all of our parks are at a certain level, then why should this one not get the same attention?

And that's the part that comes to me is to think about... Oh, I'm so sorry. Go ahead.

No, what I wanted to say to piggyback off of that is if we are pivoting or this could be a mini phase one, I would like to see some more... stakeholders from the neighborhood involved in learning more about the vision or the design of this. Because $220,000, I think, is a lot of money, so hopefully it will be something more substantial and more desirable than what there is now. So I think if we involve the community in that neighborhood, hopefully then it will be used more effectively.

So, Shane, are we building a zip line and a 50-foot climbing wall that they can climb up to the, you know, thing and then jump off, bungee cord off?

The hill with the slide, like at Central Park.

I think what I love that y'all have mentioned is y'all have mentioned different unique components from each unique playground. We have not previously in my seven years reached out to a community and said, Here's what we're doing for this playground replacement. What do you think? Part of the reason is because I've worked in previous cities where you had. And what you tend to do is alienate folks. You know, if you give them two or three votes and someone likes one and one wins, but another group like two or three, then they go past this playground. It's not the playground they liked anymore. It's the playground they wish they had. I wanted option C the whole time and they went with A or whatever. And so in areas where we're replacing a playground, we've always, as staff, just worked with vendors to try to bring the best, most unique, creative playground that we can afford to y'all, where y'all see it before we pull the trigger on it. And we're able there to talk about the uniqueness of it. But if y'all want us to put something up that... It's not you.

Something's happening behind you.

Whoa.

We can do it.

Thank you.

Awesome.

No, I like that idea of asking the... Yeah, or then we just... Maybe it's just initial not showing concepts. There may be a way to realign them.

And that master plan we did...

covered the city and we've used that master plan that we did a couple years ago that we brought to y'all not not that we just want benches not the old town master plan the parks and open space master plan to build a lot of our playground concepts i think i was really excited when we cut the ribbon on uh the playground at heritage park uh where we've got a little tractor and a little picnic table and everything in there and i i feel as though staff has done a good job of recognizing the area recognizing what's appropriate for that area If we do need to get some feedback from the neighborhood, it would likely need to be limited division, not specifics. And, yeah, make the playground that is most appropriate to the history of the space.

Are there any stray tractors in Old Town? I don't know. Those would be safe.

We'll find something.

And make sure it lives up to the UDC. Okay. Shots fired. All right, what else you got?

I did have a question about what is senior advisor? That's the one to the right of me.

City manager transition.

Oh, as a one-time, okay.

Yes. Who is that? Thank you.

I thought we just pushed him off the cliff or something like that.

We also have additional security cameras at the library. Temporary trailer removal. So we have trailers out at Public Works, and they don't just come get them and you stop paying the lease.

Oh, you explained that a couple years ago. Unfortunately. We were surprised. I remember that.

And so we have one-time removal costs built in.

We were surprised.

And then we do have the fleet replacement to transfer to the VRF, which we covered.

Somebody asked a question earlier.

Why don't we just keep it? So security cameras at the library, are you able to expand on the need for that?

There are requests. If she's here, she could expand. I know there are some additional ones.

Are we talking about interior or exterior cameras?

These are going to be interior. And we've had some incidents at the library, and we would like to offer more secure space for our people.

That's all we need to know? Yeah. Okay, that's all we need to know.

This was pretty low cost, too.

Ring. Thank you.

Not that one. Whatever the librarian says.

Yeah. If you can't be safe at the library and you need the police chief to make arrests at the library, you're living in Austin.

Dang.

Yeah. Moving on.

The hotel occupancy tax. Really not a lot of changes on this fund. Revenue is trending pretty flat, so we're not increasing that revenue. I don't know of any new hotels.

Are we seeing good revenue from our Airbnbs?

So we do get revenue from short-term rentals, and we do monitor that and attempt to enforce that on a regular basis.

Objective, non-responsive, but your answer is an answer.

So we do follow these criteria when we are setting up this budget and following the guidance of the local government code on how to spend hotel tax. The categories of the expenditures are the same. public arts, economic incentives, the promotion and marketing, tourism training, the memberships, and the short-term rental software that we use. I just am putting a plug in here. I know we've talked about the tourism PID recently. That would look a lot like our hotel occupancy tax. It would be a separate fund.

And separately controlled.

Correct. Like it would be a whole different fund. So PCDC, this is an overview of their fund summary. The proposed available net position at the end of fiscal 26 is showing $10.2 million. We're doing the assumptions of their revenue the same as for the city. So whatever their projections are for sales tax of 26, that's what we're projecting for 27. You should, yeah.

Does the expenditures include renewing their office lease for next year? They do. Do you know if that assumption was in there? It is in there.

It is built in there, yes. I did pull out the community support just so it's not buried, just to call out the city support community grants.

Oh, that they do. Okay, cool.

Yes.

That's good, actually. That's a good show. That's a chunk of change. Yeah, that's good to show the public that we reinvest in them.

You'll see the non-operating expenditures goes down quite a bit in 27. Their big capital projects are over. And we'll go over what the $2 million encompasses. And so the projection of the net position at the end of fiscal 27 will be almost $5.2 million.

I'm a little curious there. It looks like the personnel services is increasing significantly. I'm going to say about 8% over the current budget.

So no new personnel requests, but there have been some market increases mid-fiscal 26. We do have the same built-in 3% COLA and 8% health insurance in their budget as well. On the operating expenses, just a few noted, not a lot of changes on the operating expenditures. I should have called out, I did not call out, marketing studies, strategic plan, site tours, and recruitment programs. The budget also includes the request of the city for the 2.1. I should have listed that on here. It's a big number. But it is called out on the summary page. And then on the capital outlay side, Innovation Hub for $500,000, Project Nexus for $1 million, and Wet Labs for $500,000.

Tracy, I'm curious on the previous one about the personnel. We barely had any personnel in FY26 until very recently. So I'm wondering, was that an actual material difference for the two, maybe three people that were over there versus the whatever it is now, seven or eight?

Yeah, you go back and look at the previous slide.

Well, it looks like... Yeah, if you go back one more slide, you'll see... I guess I'm just trying to figure out, like, if it was, like, a...

So you will see a difference between the projected and the budgeted, where we were about, what, $200,000 lower than budgeted because those positions weren't filled.

Yeah.

Yeah, really, your variance is between the two budgets.

No, it makes sense, and that's what... What Cesar said makes sense. You make sense of what he said.

Like an off-cycle, because normally you're...

I just want to make sure I understand. Are you saying because there were out-of-cycle increases, the 3% COLA may not be appropriate?

For those individuals, yeah, potentially.

Okay. How do we do that?

Do we do it by anniversary, or do we do it by fiscal year? I think we do it by fiscal year. And is it prorated for people who start halfway through the year?

I don't know. Maybe we can have the guy who does this come up.

There is some stipulation of if they were hired really recently. I don't think it applies.

Jerry? No, I think this is a more payroll-based question, right? Yeah. Well, if someone in our department is hired in the last three months of the fiscal year, it's potential they wouldn't get that 3% because they got their

their salary established but do we there is a cutoff period i'm not sure if it's three months but there is a cutoff period of when it would apply i was about to say because i remember explicitly i can't believe he brought that up um when i got hired at the controller's office it's true this is a true story bro Um, I got hired like, I don't know, it was like June 1st or something like that as well. Fiscal year for the state is September. And I got the pay increase for the state over there as well. And I just assumed, oh, you always get a pay increase because that's what happens. Yeah. Apparently that wasn't true.

Yeah. That's why I was. No, it's a good, it's a good, no, it's a good, it's a good question. 11% raised, not on regular schedule. Yeah. We should.

Yeah.

I mean, that would go with a bunch of positions across the city as well. But when I added 11% to the budget, that was $974,000, and that was $953,000. So that's in line with the COLA and the employee increase for the insurance.

I'm sorry, before you move to that slide. The Innovation Hub, Project Nexus, and Wet Lab Space, are there active projects for that, or is that perspective?

Those look like estimate numbers to me.

I mean, they're awfully round numbers, so I wasn't sure if there was something specifically related to Project Nexus that's going to cost a million dollars in the next year. Right.

Is that more design? Throwing up the horns?

That's what I thought.

Who do you think you're coming up to speak to? Don't get crazy around here. I saw a horn.

I stayed completely out of Texas.

You got a seat, Counselor.

I was trying to make it short. That way I don't have to say it. We can make it short. I'm sorry. Innovation Hub Project Nexus Wet Lab in 30 seconds. Go. Okay.

So there is a project that's pending for the Innovation Hub. We're working through that RFP right now. Project Nexus is ongoing. So we pulled the money from this line item to fund the project with JLF. And there are next steps that we have to go in going forward. Okay.

Is JLL's contract for that amount?

Is that estimated? No, this is an estimated amount. So last year we did a million. We're asking for a million this year coming up in 2027. Last year, we did a million for Innovation Hub. We're asking for 500,000 this year. And there were wet labs last year that we did a million, and we're asking for 500 this year. We actually did not spend the money for the wet lab space or the Innovation Hub, but we did spend money on the Project Nexus.

So my core question for all three of these is, what are we actually going to get and see? It sounds like these are still consulting phase projects. Correct me. Hopefully I'm wrong, and we're actually going to get something beyond consulting for these.

Yeah, what's the work product from Spin in the City?

So that's the... The resolution that you all approved a couple weeks ago, that's the work that Project Nexus is doing. So that requires there to be additional steps where they're going to have to now go after developers for whatever the final approved project is for Project Nexus. But we are quite some ways away from that taking place.

What's the price tag on the JLL, the owner's rep contract? $400,000. $400,000, okay.

And you're wanting to give them another $1 million?

next year.

We didn't give them a million this year because it was funded.

But we paid them $400,000 for their agreement. And that's fine. So you're expecting based on the outcome of their market study that they're going through right now and the goals and objectives that we established that there are going to be activities that we are going to accomplish with this money or is this going to be they're going to create a phase two that then they're going to be uniquely qualified to consult for us.

Does this get us to where we have a developer partner on board?

Well, let me make sure I answer your question. I don't do the whole uniquely qualified thing. No. kind of find it disingenuous. Yeah, indeed.

He was joking.

No, I've been in cases where it is the uniquely qualified.

If you hire someone to write the contract for the next someone, they can write it for themselves pretty easily.

But this is really creating like I was just received the preliminary, some of the preliminary information from their work that they're doing now that I'm in review of. But once we get to a point, they're going to have to cart this off to trying to attract developers. But, again, we are a ways away from that.

We are the ones attracting developers, and we're using this money to attract them.

We've got some time before we get – because we have to review these documents. We have to agree with these documents. then it continues to go into phase. We're still talking to the public about what they would like to see on that site. So we have some ways to go.

I think some amount of discovery work around the next phase of moving this forward is fine. I personally am feeling like a million dollars could be better spent attracting businesses that can open in the next year instead of this five, seven-year project. Not that we shouldn't continue to invest in it in some amount. But spending the bulk of our money on that project that right now is so far out when we need sales tax revenue, literally right now, seems like that could be a better option potentially.

So my only question is this, is that how far out are we? Because you said five, seven years. I mean, yeah. I mean, I know JLL is being aggressive with their timeline. They're supposed to come back to us at the end of the summer or something like that, which I was really surprised about. I was like...

You're not allowed.

Yeah, and then they said, and then in start, and I recall quickly January is when, like, boom, get feet, boots on the ground, start working on this. I mean, you do this for a living, but he brings up a good point. So that's what I want to hear about. Like, how far out do you think that before we get an ROI and what we're trying to do here?

I think what you will see at the end of this fiscal year is the completed documentation according to the agreement that they have. I think going into the 2027 phase, it's going to really depend solely on what the market is showing. And then also on the backside, how creative PCDC and the council really want to be in order to make whatever the project outcomes look like become a reality.

So that's part of what worries me a little bit is like, you know, I know part of the plan is like a hotel. We have site ready locations if the market was going to support a hotel already. So that's part of what is concerning me a little bit about, you know, our performing arts center, like all of the ideas that are in the initial visioning are all things that, I mean, we're investing because the market's not ready, yes, right? But I still just don't, I don't, I'm not seeing a path in this plan to get us an actual usable property by the residents anytime soon.

So I think my question to you, Jerry, when we talk about putting these things in budgets, and I'm a big fan of establishing the budget to set the expectation that This is likely what it could take. But do you expect these to be project-based? And by project, I mean type B, 501, 505. Are these 505 projects? Or is this marketing? Is this outreach?

No, this is actual projects.

And then projects... Come back to us for approval, right? Yes, absolutely. So I guess I just want to make sure because I like to set expectations. I like budgets. I like to understand, hey, this is how much of what we have we're committed to pushing towards this goal. But I want to make sure we're not going to spend that money without us seeing specific projects that move the needle. And I think to Jonathan's point, When this money is spent, we should see outcomes. We should be able to see something measurable. I mean, I think another year of paperwork is probably not... No, definitely not.

Capital outlay has certain definitions. So, I mean, if it's in the capital outlay, it would need to qualify under the capital outlay definition. So I'm assuming that it's the same types of things that would be included in any CIP project that we would do. I guess you could do a minimal amount of...

moving some dirt around and leveling or something?

And let me set the stage here a little bit. This project is going to cost hundreds of millions of dollars. We're talking about the land by itself was around $25 million. And when you add the interest on it, it turns to $33 million. So we're not talking about... a half-acre building that we can build tomorrow. This is a lot of infrastructure. It's going to take significant dollars. So the planning effort has to be right. We're talking about how do you layer the incentive packages because it's going to take different types of incentive uses. It's going to take PIDs. It's going to take TIRs. It could possibly take some other economic development related tools. So we don't know what we don't know, which is why all of this is taking place right now. So I understand that there may be some desire to see the project move faster and less planning take place. But we're talking... millions of dollars. And so we have to get it right.

So I'll say my, so that's great. Appreciate you explaining that. I think my concern is actually that it's both moving too fast and too slow because if the residents aren't going to see anything for five, seven, whatever, however many years, and we're getting slideware and marketing materials and maybe a couple of site visits to get some developers excited next year, we're really not advancing the ball that much. And on the other hand, There's so many other places, especially given this $200 million project. We have a billion dollars worth of projects just about that are supposed to be finished up this year. Are we really ready to take on another $200 million project in 27? Maybe we are.

I yield that question to the council.

I just want to pose the question.

Yeah, I yield that to the council. And quite honestly, when we were talking about this budget, We could literally, and I'm not saying this to be facetious, but we could zero out all three items. But when the opportunity comes, we still got to come back to you anyway.

Yeah, throw it into fund balance and bring it back. But it sounds like you've got to come back to us anyway is what I heard. But I heard three different things there. Either way it goes, I have to come back to the body. I'm a little concerned that I heard three different things. I heard capital outlay. I heard engineering. I heard site work. I hear projects. Maybe that was four different things.

That's all part of capital outlay.

So projects have to come back to us. Yes. But other things that are approved in your budget are approved in your budget.

These particular items.

So if you expect these to be things that come back to us, yeah, I would much prefer you throw it into fund balance and come back with the amendments when you've got something identified so that we can evaluate it and say, yeah, absolutely, go get it done.

think just like our cip project it is worthy of a prioritization conversation amongst all of us on where to invest what our immediate needs are medium long-term needs well i think we need to wait for the the the report from our consultants agreed so i think it's premature for us to talk about this now until we get that back the other thing just logistically and how the budget works if it was included in this year's budget and we don't spend it it goes to fund balance but then we can We can come back and get it because otherwise we're just putting it in the budget every year until we get it done. Correct? Yes. We can put it in fund balance.

And just to give you some history to why we put it like this last year, when I come to a community and they say that this is what they're passionate about or this is what they're saying, hey, we need to go and kind of channel and make this particular stuff happen. When I reviewed the SEDS documentary, when I reviewed the Aspire plan, they point to Innovation Entrepreneurship Hub. Both of them do. They point to going in and doing mixed-use development and creating 10-minute walkable communities. Both documents point to that. They point to life science. And so both documents point to all three. And so my statement was, if you believe that strongly in the Aspire plan, if you believe that strongly in the SEDS plan, you will put your money in. where you say they are. We put money aside to show that. Then we ended up using that money when we went to pay for JLL for that Nexus project.

My opinion is that the Innovation Hub in particular, we hear about this often from a lot of people. We've tried different methods to try to support. Because, I mean, you know, the mayor brought it up. Doug says it often. How many patents and everything else that comes from that as well. So that makes sense to me. Project Nexus, you already named out what the contract's going to be for JLL's $400,000? Yes. So maybe it's a number you want to revisit to see what actually happens from that, you know, from there. But I think Melody's right, though, too, about that we don't know until we actually get that project And I know in the wet labs, I mean, that's something that, again, we put out there for years ago. And I think that's a great idea. I think it's important. I know that I've talked to universities and other folks about that. But is that something that we need to go ahead and put out there now as opposed to whenever something does come up? Because there are some things that are cooking along 973 very quickly that may affect... the growth and development for that.

So what I'm thinking... So in that scenario, are we splitting our bets here when really, if say Innovation Hub is the number one thing, spending $1.5 million on that and actually getting a minimum viable product of an Innovation Hub and not just paperwork about an Innovation Hub in a year sounds a heck of a lot better than moving these three projects slowly?

Well, what about... We as council told PCDC and the SEDS that we wanted these things... I completely agree.

These are all great ideas.

I agree.

It sounds like we need many CIP for these capital outlays that shows it over multiple years because there are many phases to this. You know, you can make estimates on what's phase one or phase two or design or whatever. So that's how I'm thinking about it. And so, like, because maybe we actually should say, well, what is it going to be in total, not just this year? Right. And then how do we think the timeline, the design and the construction or whatever we're going to be doing is going to play out over those next five years?

I think that's an excellent point. Is there a possibility for you getting that? to us. I keep thinking like it's already August. Yeah, I forgot.

Thank you for being early.

And there's some projects, there's some things that we did last year in the budget and in previous years. This year we sit down and met with Serena and her team and said, hey, We need to zero that out, and if there's an opportunity that comes... Oh, wait, wait.

No, I want to make sure I say this publicly. I want to be clear. Yes, I heard y'all had a very good meeting. This is exactly what we talk about, so that's great to hear about that. I just think that Melody's... idea is a really good one. So then we see, okay, we have this money allocated. What does this look like in the future? And so to Jonathan's point, should we really be even caring about this amount right now as opposed to...

I like the idea. I want to see some predictability. I also want to recognize that economic development is a different animal. There's a lot of unpredictability in this. A lot of things are going to change. The reason we have an organization, a type B, is So they can pivot as quickly as necessary. Which is one more reason why I think it should likely just all go into general fund and come forward when it's a project.

Right. It's just a different philosophy. Yes, I have run economic development before. We do not suggest doing what-ifs to show, highlight what you want to do. When you want to show what you want to do and you want to show the values of the community, if you want to show... what you want them to do. Those are in policy decisions. Those are in documents. Those are in says. I wouldn't put placeholders in the budget. You would say this and build out a plan, a five-year plan, and this year is going to be designed, and then every year you're voting on the piece of it. Because what you saw in this last year's budget was an idea of buying land for a million dollars, right?

Yeah.

And it didn't happen. And another one didn't happen. So it looks like in the budget that it's going to happen. If it's not guaranteed and it's a what if, you leave it in fund balance until you come forward and you take that money. This is a very, I absolutely oppose this. the way that this is budgeted in the what-if scenario. You want to highlight something, keep talking about it. Put it on social media. Put it in your sets. Do it other ways. You don't tie up budget money for a what-if game plan. I definitely disagree with this.

And I totally hear you, and I like the idea. I just want to go back to the fact that not too long ago, within this past year, we had a conversation with With PCDC, and we told them we wanted to march east to buy land. We wanted wet labs. And Jerry's bringing that. He's talking and he's budgeting it. So my point is, if we want them to do something, we need to tell them. Because Jerry is doing exactly what we ask him to do. And Jerry, you've heard that, right?

I think you missed what I said. I'd be happy to clarify. I can give examples.

So, yes, we want, well... We say we want wet labs. I was not so excited about wet labs, but we passed the sets that includes those things. You watched all the videos before you got here. I remember that. I know you did. I know you did. Yeah, so we want wet labs. We want to say we want wet labs. I should see it in the budget when we have a contract or a development project. It's not right. Yeah, so if it's a placeholder, I think to Melody's point, a CIP, a capital improvement plan, not a program but a plan in that scenario makes a lot of sense. Tell me, put your money where your mouth is. These are the things we're planning to spend money on. It's not in the budget yet. It's not in the budget, but it's the things that we plan to do, and this is the vision. I think articulating the vision in that capital, something similar to a capital improvement plan makes a lot of sense. So I think that's what I'll be looking for over the next several months while we firm up the budget. That make sense?

That seems like a different way of writing the same idea, but that seems like a reasonable... You need to know what we're going to get. I have a question about the Innovation Hub. Correct me if I'm wrong, Mr. Jones, but the Innovation Hub is actually something that it looks like is going to break ground this year, or am I overly optimistic about that?

I wouldn't say this year, but there is a RFP that we're responding to. We are competing with three other communities for this particular innovation hub. The decision will be made this year as to where it will go and when it will happen. land in the particular community. We're working really hard to attract them.

By this year, do you mean this calendar year or you mean this fiscal year?

The decision will be made where they locate this fiscal year. So before October? Yes.

Are you referring to the group that was in town? Yes. So this is a specific project, not really a Pflugerville Innovation Hub. This is a

We are trying to attract somebody who... No, this is not... Yes, you are right. I apologize. This is not a, oh, we're going to chase after an innovation hub, and this is the money that we're going to use specifically. The whole purpose behind putting... And again, I want to be very clear. This was a million last year. And what we did was we went out and said, hey, we have this amount of money set aside for this to attract this particular indefinite. Now, we didn't do that for Nexus because I didn't want JLL to know how much money we had in the line item. So we definitely didn't tell them that. But it is a different philosophy. I do agree. I can stand on both sides of the table when it comes to what Serena just said.

I can agree with her philosophy.

Either way it goes, right? You either can say, hey, we have a set of funds set aside for this particular endeavor. It's a fund. I'm seeing other economic development organizations try that approach. Or we could say, hey, we have an opportunity to incentivize, come to us with the idea, and we will go to our fund balance and grab the monies. Sure. So I'll go back to what? It can go either way. I'm not ready. Mm-hmm.

I'll go back to what the mayor was saying where I think, again, so if we're really talking about a specific project that we may or may not win in the next couple of months and they're investing, we'd probably have some sort of incentive structure that's fine. But I don't know if $500,000 is that incentive structure. Again, it goes back to the question of being an actual plan.

Until that project is that project, it doesn't need to be in here. And I'll tell you, because if that project, if we don't win that RFP, then there's the potential that you're going to build your own. There may be office space available that you can lease for some portion or more of that money. So you may be building your own. Until we know what we're doing, I'd love to see it in a plan. I don't want to see it in the budget.

Yeah.

I think we're good on that. David, you got a little more clarity?

Well, I was just going to say, speaking of building our own, it might possibly be that the Innovation Hub goes inside Project Nexus. I assume that that's one of the options that y'all are looking at. Yes.

That was a quick and short answer, wasn't it? Nexus or Downtown East.

Yeah.

Yeah.

All right, thank you, Jerry. Thank y'all. Tracy, thank you for...

So to wrap up our budget session... She was like, I was almost done. That's so close. Right at the end. So just pointing out, in July, we'll have another work session. It will focus on utilities, Monarch, and any changes in fees. In August, we will be bringing back the proposed tax rates for the governing body to vote on the proposed tax rate. And in September, we want the public hearing and the approval of the tax rate.

Tracy, question on that. Do you have an idea in mind of how you might use the Finance and Budget Resident Community Committee?

We've met with them. So they got this presentation last week. We meet again with them August 19th to go over the proposed budget. They will receive the document the same day you do so that they have... 19 days or so, 18 days, to look at the document before we come together. We're actually extending that meeting to an hour and a half because an hour is not quite long enough to go over a 200-page budget. But anyway, they will see the proposed budget. Okay, cool.

Yeah, I was just curious how you're integrating them into the process. Sounds good.

Thanks.

Thank you, Tracy. That brings us to the next item on our agenda. This is discussion regarding the five-year capital improvement plan for fiscal years 27 to 31, with emphasis on the projects and priorities to be considered for fiscal year 27. We've got Director Rector, and here comes Assistant Director O'Shea.

I guess you're driving. Nope, that's you. All right. Good evening, Mayor and Council. So we have presented the CIP multiple times. We've presented it in multiple ways. So we're going to try one more time. This one, I'm going to push a little bit because I need some clear direction because you'll see at the very end of my presentation, we're going to expect you guys to take a formal vote at our next meeting to actually lock this thing in.

Yeah. My hope tonight, Mr. Rector, is that we have the different funds, the different sections, and we can each point at the items we think should move up, move down, move in, move out.

Has any of our feedback from the last review been taken into consideration here? Because we did spend an hour or more last time providing ideas, feedback.

We will be doing our best to build consensus tonight.

And he's going to discuss it.

Yeah. Go for it. Thanks, sir.

Didn't want to lose all of the things that we need to.

Yeah, because I didn't take notes, so I hope someone did.

It's on video. So before we get too far into things, I did want to point out that we are pushing three items out of the CIP. That's FA-2702, FA-2701B, and FA-2801. Those we do not anticipate happening in the five years, so we've removed those.

I'm sorry. Do we want discussion slide by slide? How do you want to manage this?

Yeah, I think we're... I want us to have the opportunity to talk about this because these are things that have been pushed beyond the five-year CIP. But I thought some of these were originally scheduled within one or two years, so we've pushed some of them pretty far out.

So tell us about why they... What was it? I know we talked about it at length, but I've slept since then. Why was it that we pushed the SCADA project out?

So the rationale behind the SCADA project originally was created by prior staff to completely air gap the SCADA system. And in multiple conversations with our IT team and current staff and city management office, we have determined that that is not the best path forward. So we have put that project on hold.

So that was private fiber loop for security reasons? Yes.

Okay. Well, we believe we can accomplish the same thing by working with IT and creating the firewalls.

With encryption and... Yes. Okay.

Okay. And then I'm just going to keep going. So the Justice Center, we didn't see that that one would happen within the next five years. Most likely it's going to require some future bond election. And so to do a full expansion of this, we figured it would be better to push that out beyond the five-year window. Let us finish the projects we're working on, see how this current bond election plays out, and then reevaluate things a little further down the road.

So does that mean we wouldn't get things like the expanded evidence processing area, the renovations to this room, are those... Those are separate projects. Okay. Can you just...

I want to make sure that wasn't lost. I believe there's going to be some confusion. So maybe identify those projects that are still going to happen and what the definition of that one was.

Sure. So the... I imagine you'll get to the ones that are still going to happen as we go through the individuals. But this one in particular, expansion, I'd heard rumors about closing in the courtyard before. What... What were we getting for $21.7 million?

So this was basically adding additional square footage to this building, whether it be closing in the courtyard, adding additional levels to facilitate additional growth and expansion of staff for the police department, moving the evidence building out of their exterior building into a new evidence location inside the building, adding more office space. I can't remember all the things off the top of my head.

But it's square footage here? Yes. All right. Thank you.

And then same thing for the library expansion. We didn't see that that one was necessarily going to happen within the next five-year window. And so it does not eliminate the potential roof replacement project. It's just for the... Just square footage. Yes.

And is that one also... You mentioned with the first one that it could require a potential bond election. Would the library also be a potential bond...

I mean, any bond election is counted as prerogative, but yes, I would assume that that's the way you would want to go about it.

And so these two were not recommended by the current bond advisory commission to move forward in 26?

That's correct. They are not on the current bond advisory, and you'll see that recommendation coming soon.

We didn't go back and ask to delay these. I would say the bond committee wasn't trying to give these to me.

They were not pushing those forward. Okay, thank you.

One thing I want to say, especially for the library expansion and or the Justice Center expansion, is do we really think that those, it's going to be five years? Is it good to keep them on the list even if they're in FY30 for now, considering we refresh this every year so that we are continually updating our expectations and it doesn't get lost in the wind, so to speak? That's probably a question for us. How often do we do bond elections?

As often as we want, traditionally?

I mean, if we even have one.

It's been six years since the last one, then it was two years, then it was three years, and then it was however long.

So it was 14-15, it was 20. So I could see leaving that in at year five just to demonstrate that we know it needs to happen.

It's going to be a need, yeah.

Does that make sense? Yeah. Want to see if we get consensus? You don't want it in 2030, 2031?

If they don't feel that it's going to be accomplished in five years, then we shouldn't include it.

I think we should include it when we expect there could be a potential future bond election.

And this would be a starting, not a... Right. We wouldn't start it for five years.

That's a different criterion, though.

That's interesting.

I mean, if that's the case, then absolutely. Because I think at that point we'll be in a better financial situation.

That sounds like 31.

I'm counting at least four head nods. I don't think we've got consensus about that. We may have a majority about it. Do we have a majority?

Thank you. Moving on. All right, so some things you're going to need to know as we walk through this one because this is going to be a little different. We have tried to simplify and give you a lot of information. So you'll see a single dollar sign in a circle. That means it's funded in FY27. A double dollar sign in a circle means it's completely funded. The little bank columns there means that it's future debt.

Why didn't you do a dollar sign with a check mark to be completely funny?

Doing our best. Next time. Let's do our best to get through.

Green font is the funded amount. For abbreviations, which you know I love to use, GF means general fund. UF is utility fund. CO is a certificate of obligation. GO is a general obligation. Orange font is the 2020 bond projects. Blue font is the 2026 recommended bond projects. And then you have the project phases. So the little stop button is not started. The yellow triangle means it's on hold. The little magnifying glass over the paper is studying land acquisition with the handshake in LA above it.

This is pretty impressive. I love it. Yeah.

We tried to get a little more creative, but it was getting a little too... We don't want to overdo it. Okay, so moving on. So here's where you're going to see everything start coming together. So these are your drainage projects that we're recommending. You can see that none of them have started. Some of them are fully funded. Some of them are partially funded for the FY27. And then the majority of them, we would need future debt. Now, one of the things that I want to point out is... We've presented the CIP to you in a manner of these are bond funds, these are construction projects, based on where they're at, so kind of a timeline. We've presented them to you in map format, so it's a geographical thing. Now we're focusing in on the funding aspect. So this is a slightly different order than what you've seen them in the past. But this is where we're at today, and this is where we're going to need feedback from council as far as what you want us to change before we bring Draft 6 to you in July for a final, yes, this is the CIP, move forward conversation. So you have the Drainage Master Plan update. That's the one that's fully funded right there at the top. And then you have the Emanuel Road, Pecan Park improvements to the Gilliland Creek channel. and then the Caldwell Elementary Upper Gilliland Creek channel improvements. We did discuss these last time about potentially shifting them around. I don't know that we ever got a clear direction.

I want to make sure that I understand. Obviously, the drainage master plan has to come first. We don't know what we're doing if we don't have the road plans. We've got to build that first. My understanding from our previous discussion is that the – The primary reason that the top two, the Emanuel Road and the Caldwell Elementary channel improvements are priority items is because those are items where we're concerned about potential for flooding and damage to homes now. next year two years from now and we don't get on top of this right now we're looking at the possibility that that water issues will impact existing homes am i am i wrong about that no um

No, I'm wrong about that. No, I'm not wrong about that. So the reason why... You are correct. We're concerned about flooding. That's why we're recommending these. These are from the current drainage master plan. The reason why we pushed the Caldwell Elementary particular project to be recommended for next year was because there were so many homes and a school that were impacted. Typically... and I shared this with you last time, when you work on drainage projects, you work from downstream to upstream. So based on the drainage master plan, the most downstream project is the Emanuel Road to Pecan Park project. So that is the logical, normal, typical place you would start because when you start freeing up flow upstream, all you're going to do is make flooding worse downstream. But because of the safety factor and the impacts to property, we determined that Caldwell Creek was of high enough priority to go ahead and our caldwell elementary sorry was high enough priority to go ahead and prioritize that one as well so you're starting on the opposite ends of the of the channel that's in the drainage master plan probably an immaterial idea but i'd like the ability for comms to be clear for our residents of potentially moving the caldwell up into the number two spot because it is directly homes and a school as opposed to

generalized improvements that will help people for sure but i just from prioritization perspective and again maybe immaterial because both of them are starting it's kind of like yeah they're they're tied for a second yeah so i have a question about the drainage master plan what we talked about last time as far as some of these lower items about regional detention base and Will that include analysis about a drainage fee if we are doing any of these regional detention basins?

Yes. That's one of the goals of the drainage master plan update is to look at how to pay for projects and what type of recommendation to make to the city council about a drainage fee, whether that be in the form of a utility drainage fee or a drainage impact fee or some other format that's to be determined. But that's one of the goals of the update. Matt, who does that now? I'm sorry, who does what?

Are there other cities that have implemented utility drainage or drainage impact fees? Yes.

The city I came from, which I won't name, they have a utility fee that they charge in their monthly utility bills. Every month. They use a flat fee formula. There are cities that don't have a flat fee. They have a graduated fee formula.

Based on impervious surface.

Based on impervious cover. There are cities also that when you have developers come in that can prove up that they can quote unquote beat the peak. And that's usually projects that are on a creek bed. that can prove that there's no adverse impact for them to not detain. I know of several cities very close to us that have implemented requirements that all development projects will detain on-site, will detain off-site, or will pay a fee in lieu of detention. And then they use that fee to help pay for drainage projects, specifically because that development is dumping a bunch of extra water into a creek and we're trying to solve problems on the creek. So why should they not have to pay their fair share to help mitigate for that?

And we've had a conversation previously about utility drainage fees, and I think the drainage impact fee sounds like it's likely a very interesting concept for us to pursue.

Yeah, and especially as we look at the collection of impact fees that we have and our economic development needs as well, right? There's a balance there.

And the source of those fees.

All right, so before I move on, I want to make sure that I heard the direction correctly.

Go ahead and swap Caldwell to number two so we demonstrate that it's a higher priority even though they're both happening simultaneously.

Yeah, okay. That's the only optics.

All right, moving on. Two facilities. So this gets back to the conversation we were having about... the Justice Center renovation. You can see those are still here. Justice Center renovation is still here. The evidence processing is still here. Library roof replacement is still here. And so this is, again, this put in priority order of funding mostly, but also it just so happens that funding lines up with the status of being in construction or not yet started.

Hmm. I'm sure you can predict what I'm about to say in that we should know what our overall plan is for the downtown before we go buy property for a parking garage and then build a parking garage. Um, we may or may not need one, but I think we need, given what we've seen in the market study that we're at least several years away from having, um, our existing property, uh, leased out fully, renovated, or replaced, it makes me nervous to go ahead and bank even more land than we already have when we're not quite sure what's going to happen with those stuff that we already have.

Remind me, that blue color is?

That is projects that you will be seeing in the bond advisory recommendations. So those are 2026 bonds.

So those are dependent upon a bond election call. Yes.

Well, it's dependent on the council policy. whether they put it forward for a bond.

Yeah. Well, I mean, I think, I think the part, the only, the only retort I'd have for Jonathan is that if it's not going to get cheaper. So if we're going to look at something on the chessboard, I think it's proven well to own the chessboard. I think owning a chessboard in the press market makes sense too. Um, I know a lot of people who are buying a lot of property right now at very cheap prices because of that. But ultimately, I mean, I think we've all talked about the parking garage. Like, we're like, okay, that's another story. Because, I mean, does that property truly have to be dedicated to a parking garage? Or can that just be property for something we ultimately...

Would it potentially fit on something that is existing? And I think we're yet to see how downtown East does. Maybe there's a solution where we don't need a parking garage in core downtown because it's so accessible going back and forth. Again, we may ultimately need one. I don't know that it makes sense to get started on it this year.

I concur. I don't believe that putting it in 2027... it, you know, I don't agree with that, but I mean, and I'm not sure that what the need is given the same things that Jonathan said. Um, I, have another item on the justice center court renovation because previously it was says, well, this is our estimate. I just, I'm not sure that the design and 100% construction can all happen in 2027. If we feel that, I mean, you know, this area needs to be renovated, but I feel it's more appropriate to put design, in 27 and construction in 28. And I still am leery of why it would cost $2.2 million to renovate 2,600 square feet.

I'm telling you. I don't know. I just can't wait until that bid comes back and you're like, dude, It's government. I'm telling you.

Based on the need of offices or renovating things, I don't know. I'm not sure. But I don't think it's going to get done in 2027.

So I agree with you on the former, not on the latter. I think that makes sense to split the cost if, realistically speaking, how long it's going to take for us to design and ultimately construction. That makes sense. Absolutely. We have something on the shelves right now that we're just going to pull and be like, dude, we're ready to go.

You must have put it in one year for a reason. Yeah. Presumably.

Well, I would assume that reason is because it's already fully funded. If we split it into more years, we'd look at, are we reallocating money or are we just holding on to money?

Or it might be a design-build contract where they're incentivized to get it done.

To get it done.

Yeah. All right. I mean, it's... Yeah.

I just don't think there's enough information to justify $2.2 million.

Well, I mean, I think that's a very unique – it's not like he threw out like a round number. So he didn't pull that out of nowhere. So, I mean, there has to be a rationale to that.

Do you have backup for that number that you can provide?

Yeah, so we actually have a firm that's working on our facilities assessment.

Just in the background in the weekly.

Okay.

Yeah, that's all. To go back real quick to the downtown core public parking improvements, I heard some desire to push that out further. So my stance on that is that we wait and see what the Bond Advisory Commission says and then determine whether or not that's getting pushed out or not. So Bond Advisory Commission is going to give us advice, and then we're going to make a decision whether we move forward with it I think it would be out of order to make the decision that we're going to wait on it before we hear back from the bond advisory.

I think it sets expectations though, either way. Now, one of the things that if we don't do something and if there's not consensus, fine, but if we don't do something, director rector is going to come back in our next meeting and ask us to approve the plan. And if the bond commission, I don't know when they're scheduled to finish, if they're finished or not,

That is another... Well, they've got to be finished by July because we have to set what language for the bond in August, something like that.

And if there is general agreement that this should get pushed out by at least a year, then we save the bond commission's effort in continuing to debate it. And actually, I don't think they're supportive of it.

I'm not sure if they're debating the timing, but again, I just hesitate to see that... You know, there's the bond in November. Then you have, you know, I just don't see it happening, even if all things aligned.

I'm looking around, so I've got two to push it.

I like letting the public talk and the commission. We speak through our commission, so I'm good with waiting.

The commission should be back Monday.

Yeah, so then we get our answer in July.

We'll know at our next meeting. No, it's fine. We'll get our interns. All right. So, so leave it there for now. Okay. So did we have a, uh, I, I heard no changes at this point.

Just perfect. All right. Uh, so on this one, this is just the utility fund portion of the facilities. So we've already got the public works facility that's in construction. The only one that's added here is the public works building number six, which that is the, it, That's where the main tranche of staff is at the public works building, so they will all be relocated out of there. And then the idea is to renovate that building to convert it into a lab and office space so that we can vacate the final trailer on the public works or the wastewater treatment plant side.

And that'd be specifically for the folks who need to work there on site with the wastewater treatment plant? Correct. So are we getting trailers? Getting rid of trailers.

We would be getting rid of trailers. We've got a trailer for them now.

Well, we're moving, yeah, because we're moving them out for a hot minute and then we're moving them back in.

No, so we've got, we currently have four trailers. When we move to the Public Works building, we will be vacating three of those four trailers and getting them removed. The staff that's staying in the wastewater treatment plant would stay in the fourth trailer until this building is renovated. And then they would move out of that trailer into this building. And then that fourth trailer could be removed.

How many buildings do we have at the Public Works? There's six are listed. So what about the other five?

Building one is where Parks is going to be going. And then the rest of them are warehouses and, like, storage-type buildings. So they're not set up currently for people to occupy. Chemicals and equipment.

What about the building where there's current offices? I mean, there's two buildings that have current offices.

That's Building 1 and Building 6. Building 1 is where Parks is going to go. Building 6 is the one we're talking about.

The one we're talking about for lab space. Okay. Any concerns, Council, with this prioritization?

I think it's ridiculous.

All right. 6-1.

I was just here to say go Spurs go for the public record. Did y'all have questions? Just kidding. Not really. So, Barks, we reprioritized a couple of these based on the conversation. I do want to highlight, though, that I mean, our prioritization is based on the funding. So if you see it starting in 2027, we're prioritizing it pretty high. I think some of the ones we discussed last time were all starting to be funded in FY27. We did make some changes, but that's how we prioritize internally. We're wanting to start those earlier, obviously.

Did we include our conversation from last night regarding the parks, rec, and open space master plan?

In terms of, you have to remind me of what the conversation was. What do you mean?

This is a two-part slide, correct? We're talking about space in general. Correct. Okay, so that's not the whole thing.

No, these are, yeah, some of these are in 27 as well, but then you've got the three at the end that are at the end.

Can you go back to the previous slide? There we go. I mean, I have, I'm looking at Wells Point, Gilliland Creek, and the park rec. I mean, I see they're all fairly low with the exception of Wells Point Park Improvement. I don't know. I guess my question is how necessary are they compared to some of the lower ones? I'm okay with leaving it how it is. I just wanted to have that conversation of those three right there. How necessary are they? I mean, I know Parks and Rec and Open Space Master Plan update is only, I should say only, it's pretty low compared to the others at 125 and then 150 above it, but I don't know. I mean, Is that as... I see Serena's... We might want to explain the necessity of having a plan and how it's done. Yeah, you're asking about the importance of those three? Well, I'm not saying take it out.

I'm just saying put it at a lower... You just move it down or move it out? Move it down. All three?

Move it down but not move it out.

That's fine. I think that's an optics if we want to place other ones ahead of it. But again... When our staff, because we've got different staff that are going to be doing these projects, obviously we've got a part project manager, planning manager, they're going to get started on all these simultaneously. So if we want to move things around to prioritize actually what we think is the most important, we certainly can do that.

We want to demonstrate to you what our commitment is.

Well, you're going to get started on the first five, but after that everything's in blue, so that might take a little bit longer to get started on those, correct? Blue is correct.

Obviously we're not starting that in October because it's dependent on November.

So I have a question about the destination play space, because if I recall correctly, that that was going to be dependent or could not move forward until the Emanuel Road was completed as far as the actual construction. And when I looked at the details of the 1.6 million, it was more than just design. So again, I have questions about how can we move forward with construction if a manual road isn't going to be done?

Yeah, no. So we're coordinating with the team, the project team that's working on a manual road. We think that those can work concurrently. We're going to get our design teams together to also make sure that where they're putting you know, drives into Bulls Park makes sense with destination play. So we've got the first step of destination play on the agenda for later tonight. So as soon as we get that design team on board, they will start communicating with the design team on the annual. We don't have any concerns. We didn't know about that, but we've talked about it since, and we don't have any concerns about those.

Okay, I would... To Cesar's point, I would like destination placed. I mean, because this is phase one, so obviously the other part. But phase one, I think, is a priority because that was part of the 2020 bond, and we've promised it to our community. And so I would like to see that higher up, at least the phase one part. Sure. That was it.

Yeah, where are you thinking? Line 3, line 4?

I was thinking 3 if we move the others. And actually, I wanted to talk about the annual lateral improvements. I mean, that's 2.1 or almost 2.2.

Now, that is potential bond funding, correct? Is it a potential bond? It's in blue. And I know I made a mention over here to the city manager. I do want to make sure when we're color-coding things that we're mindful of accessibility requirements. We want to make sure that people can tell that they're color-coded. even if they can't necessarily see all the colors. But that one being blue means that it would be dependent upon an election in November, potential election in November.

In the Lake Pflugerville Park Phase II development, 2027 is primarily the beach, and the $6 million in 2028 is... Remind me again.

No, so that's just construction. It's not necessarily based on specific amenities within the project. It's just when we start. So design is going to take 12 months. We just kicked that off last month. And so that takes into account when we're going to start construction, not necessarily what we're constructing.

So what tranche of funds?

Right, so we're going to start getting into construction. It's going to be mostly design through FY27, and then we're going to get into construction in the latter half of the fiscal year.

And what are we constructing in 2028 that's going to cost us $6 million there?

Well, we've got to get more into the design to be able to determine what's going to be constructed when. So we're still in...

So it's too early to tell.

It's too early to tell. We're in environmental engineering and conceptual design right now.

There's beach and boardwalk and play spaces in there.

Right. So, you know, to that point, we'll have... I have no doubt we're going to spend what we're asking for in FY27. It may be a little more in FY29 and less in 28. We just don't know until we get further along in the schedule for design.

Well, $6 million is a lot to commit to when you don't know what you're building with $6 million. I'm a little concerned about that number.

It's going to be all one construction contract. We're not going to build... Amenity by amenity, the entirety of the facility will be constructed.

So that's based on paid tranches, not on contracts?

Correct. So the plan is to have one contractor handle all of the improvements in Lake Pflugerville? Correct. Okay.

So on the annual trail improvements, do you have more information about the identified improvements Areas that we want to improve for the $2.2 million or will we have it sometime in the near future?

Yeah, no, we have the trails identified all the way through 2031.

Okay, but it's not listed in the CIP as far as...

Well, I assume we have to put that forward as part of a potential bond proposition.

Well, it has a green and it's blue, so... That's going to be information that's on the... Yeah, I don't know what that green's for. The CIP as well. I mean, the dashboard as well as we go along. The problem with...

Well, Jeff, answer me this. So I assume that's going before the bond advisory commission, right? So do you have that list available to them right now? They'll see the list. Can you give that to us in the weekly?

We can provide the list in a weekly, absolutely. Yeah, give that to us in the weekly. We just want y'all and the public to understand that can change. I mean, we may change what projects we're working on next fiscal year.

Are those the same trail projects that you presented? not too long ago that includes... For 2026 it is.

That was the 2026 projects.

Ah, okay.

Correct. But that team that we presented to work on that to do the engineering also scheduled out the rest of the project, not the rest of them, but most of the projects on the Mobility Master Plan through 2031. So that's why you see more specific amounts there than you've seen in the past on annual trail improvements. We actually have those scheduled out. And that's based on the prioritization from the plan itself.

There's the second page, right, on this? Yes. Okay.

I heard destination play space up to the third spot. Other than that, I heard no other changes.

All right. Transportation. So we've got a lot on here. Again, remind you that the orange is the 2020 bond. Green means it's already funded in the year that it's showing green. And there are no blues in this one. So I'll leave it to the council for discussion.

Is there a reason the 2020 projects, the last two, are not higher up on the list?

This was just by funding. So the... Remember, we showed you prioritization based on status, and then we showed you geographically, and then this is just ranked by funding. So we can move them around however you want, but this was just...

So they're all dedicated to 2027, most of them being complete within that time frame. Anything we change now would be, I'm going to say messaging. Mellie, what would you like to see higher?

The 2020 bond project.

The orange ones, put all the orange ones to the top.

Yeah, Plover Farm and City Intersection improvements.

Can you read?

I don't know what else is on the next slide.

Hold on, hold on. Go back there. So the hard hat in the first column seems to be the way that these are grouped.

Yes, they're by... So it's...

So those are already in construction? Those are already in construction.

Okay.

And some of these at the bottom are, I guess, just still in design and about to move to construction? They are in design, that is correct.

And we're pushing to get them into construction.

Okay, so that is the reason why they were lower, because they're at the phase.

It's the phase. Okay. Yeah, they're sorted by phase.

Yeah.

I just wanted to understand.

Yeah. Anything on this slide?

I'm not sure about these specific projects, but I know that you had pulled the transportation projects out of the bond consideration. Are those same projects now, have you basically figured out a way to fund those in your prioritization that you've done in the last month or so? Or did they get bumped down on the list? How did that work out just strategically, high level?

So the short answer is yes.

Okay.

Okay. Move on. So we shifted money around to cover some of the projects, and then the ones that could not be funded, we shift those into the lower priority.

Okay. And I'll tell you the question behind my question was that I believe those projects were largely 685 relief routes. And so I didn't want us to lose sight of that because that project's got to, you know.

What are we looking to break ground on phase three, Kelly Lane phase three? I know it's still in design and everything else, but do we have a guesstimate of... Well, it looks like we're spending a lot of money in 2028, so I'm guessing probably about halfway through.

We are actually getting close to 100% design. The thing that is slowing us down the most right now is utility.

Utility relocation right-of-way acquisition? Yes. That's a shock. It's just the course.

Yeah. Well, I'm just going to suggest that it's like we did in much of, was it phase two? But we did a lot of it during the summer when activities were less in that area because Rudy will tell you it's crazy right there during school.

Well, this is my frustration is that, and maybe we just need to do it again. Who's the problem? You can send it to us in our weekly.

We need to have calls with Encore.

Because we literally went through this last time. I thought we were quite clear with the entities to play nicer on this crap. Let's just line them up again.

Stupid. Is it above ground or underground utilities?

They are, most of them are above ground right now. Well, then we know who we're talking to. And just for complete transparency, I have been having conversations with city attorney about trying to move things along.

Lean on us if we need to make calls. We have contacts too. We know people who know people.

I have a question. We know people who carry big bats. Go ahead.

Okay. Weiss Lane Widening. And I'm also looking at Limestone Commercial to Pfluger Farm Lane, which I guess I'm... Based on some previous agenda items, I'm wondering if that's going to happen at that speed in 2027. And Weiss Lane is also in the design phase, right? So just wondering why Weiss Lane is lower priority. Are there delays in the design that we think the other projects are going to happen first?

So... Again, I'm having trouble with the... Wiseline is already in design. We're pushing forward with getting... That one in particular, you may recall from one of my prior presentations, we slowed that one down because we're trying to align it with several utility projects that are happening. So we're trying to line all those projects up so we only cut it one time. Cool.

Yeah, so, I mean, just as a...

citizen or you know resident to me Weisling seems more important than limestone commercial to Pflugler Farm, but I don't know.

It depends on the time of day.

Yeah, but if we're going to have Pflugler Farm North that's going to be connected, and that was part of 2020 that's going to provide a lot of relief, I think. I'm just saying, but if that's the reason, I just think Weiss Lane will be more impactful.

Yeah, just like we said for other things, this is primarily by funding and then by phase, and if If for optics reasons. I think we're good.

I see you. I mean, this is all still that design section. You've just got the one with the red light on it. Yeah. It's fine. I'm not seeing any reason to rearrange these. I don't.

I mean, again.

All right. Optics only. It's fine.

And then now we're getting into all the ones.

We're getting into the ones that are in future years. Primarily, yes.

And why is the traffic signal system improvement implementation stopped currently? The second line, 1903, it has not started. Okay. But that's something you imagine that will pick up at the beginning of the fiscal year?

Yes. We are trying to push as many of these forward that we already had funding and

contracts for as quickly as we can well and it seems like that is something that would be something you'd work on concurrently with the other projects because you've got to change the traffic signal implementation and coordination as traffic changes right that's a continuous process isn't it fairly continuous yes okay thank you well

I'm trying to wonder if I want to open Pandora's box in 1.38.

We're getting close on time. I want to make sure we get through as much as we can. Do we have any other prioritization questions on the slide?

Yeah, I will about Mocan and 1.38, but we can try to see what we can squeeze in.

Reza, do you want to move it sooner or move it up?

Yeah, I mean, I think Mocan's going to... take care of itself.

What part is this covered? I can't find this part.

Great question. Or is it a connection? Great question.

I'd have to go back and look at the map.

It's too far out to worry about right now.

It's fine.

I just think that... You think it's going to go away?