City Council - Regular Meeting

It just comes I think it just comes around a lot more often. This one we'd like to welcome everyone to our work session today at 4:30 Tuesday May 5th 2026. We have all council members present. Dh council member Anderson might make it. we'll put it that way for regular session. Um but again, welcome and welcome to our resident who is joining us today. Um before we start, um we do have just as a reminder, uh council, we do have RDA and LBA tonight after council meeting. Just a few items to take care of. Um but for our work session, we're going to hear from director Megan.

Well, with something real quick, we've invited Andy Binker. Oh, Andy, come forward. to come uh share something with us before we turn it over to All right. So, we'll Andy, we'll have you first and then director Zinger now works.

Hello, Mayor and Council. So excited to be here tonight. Um I come bearing gifts and exciting news. Um, but before the gifts, I just wanted to make you aware of three cool things happening coming up. Um, the first one, we're going to do a service project leading into May or Memorial Day. So, we're inviting everyone on the 21st to come to the cemetery to set out flags. It's going to be 1,630 flags on headstones of veterans. I've been working with Dion and he has been Scott, can you send us a reminder on that? Yes. Thank you. Is this just is this for city staff or the community as well?

The community. I'm trying to invite youth groups from all over to try and make this happen. It's a big project. Um so that is going to be really fun and ambitious. And then we have our Memorial Day thing um service coming up also on Monday, May 25th. Please let Scott know if you'll be there so he can let me know if you'll be there. Um but this will be cool. We have asked the youth of Pleasant Grove to submit essay to do an essay contest. And so if you're okay reading three essays, we've narrowed it down to our top three um and just reading over those, I can send those to you and I would love your feedback on who can win. Um they'll be speaking at the Memorial Day service, which will be really neat. So when when do you need those back? Is Friday too soon?

No, that's fine. Cool. I need them in the morning. No, not yet. I can send them tomorrow and we'll say Friday. And if Fridays doesn't work, Tuesday is great. Okay. Ready for your presents? They're ready. I I think I have one already. So, we're Oh, wow.

You want me to open one just to feel special and then I'll give it to Wow, those are awesome.

Aren't those amazing?

And then this sheet is the This is the breakdown of how it's going to fly, okay? Of how it's going to work. So, these are we are introducing these to the community on Monday. Hopefully, this is our kickoff. So, we're going to start promoting them this week. Um, but these are the collectible magnets that we've been working on for America 250. Um, so the goal with these is to encourage um more attendance in um our our special events, especially the ones that regard the United States as well as um as well as our community. So things that align with Pleasant Grove like follow the flag that's US and Pleasant Grove Strawberry Day's Heritage Festival, but also encouraging people to come to our Veterans Day and Memorial Day service as well as our Fourth of July, so also save the date, Fourth of July at Cook Family Park event. Um, so the goal is people buy the frame empty and then at every event they can collect one of the tiles. Um, so the frame itself is $12 and then all the collectible tiles are free at the event. If they miss it, they can back back back pay and get two or back pay and get their tile and then we're going to release the full complete frame on the 4th of July. Hoping by then we have established a lot of FOMO and excitement around it as well. So I'm hoping all the people that collected quarters for 20some years when those came out will also be loving these. Um, any questions? council.

No, I love it. I I think it's really cool. Pretty awesome. And they have a magnet back so that way you can hang it on your fridge or when when will they start being available? Um they will be available Monday. Oh, Monday. Okay. At the wreck. So the rec center and that's where they purchase them. And we'll also have them for sale at events. Council member Rogers wants to know if you can turn his into a belt buckle. Actually, I would love that idea. That would be a really cool belt buckle. We've had this. I'll help you with that. It would be awesome. Okay. Yeah, I like it. That's cool. Yeah, I love that. Thank you. And so, yeah, if you have any questions, let me know. But that I hope you enjoy it. Very like social media push so everyone knows about these. That'll be coming, I assume.

And I'm hoping to push the fact that as far as I know, no other city in the nation has something like this. Some cities have done like collectible patches or something that you can earn after going through so many things, but I think it's cool to do something along the way. And this is so unique. You won't see this anywhere. So, I love it. Very cool. And this all these tiles do represent our community. So I love that. Thank you. Thank you. Really good job,

director. Okay, let's It's pool season. Are we ready for the pool again? Let's Let's do it. We're excited. We're excited for a full year of having the new pool renovated and in place and now we're headed into our second year. So, we're excited about that. Um, we want to look as we looked at overall cost, wage increases and things like that. We wanted we took a look at kind of the overall operation of the pool and saw some opportunity to do some some pretty deep savings. Well, I I consider them deep in my tiny little budgets. Nothing compared to the whole city. Um but uh looking at adjusting hours of when the pool is open. Um so what what we're proposing essentially at this point is the pool currently closes at 8 pm. We'd close it at 7. Uh so uh to give you some numbers that kind of behind that 1 to 4% of our daily attendance happens from that 7 to 8 pm. So it is a very low attendance time frame, but it costs us $425 per hour

in just staffing costs. And so, um, if we make this adjustment to this 7:00, uh, time frame, that's going to save us $27,000 in wages. And then, additionally, when school opens in August, we are normally open in the afternoon, right? Right after school. There's also a very low attended time frame as everybody's transitioning back to school activities and all the things. So, the idea is that we will be open obviously in the evening, but not right after school. And that makes an additional savings of $36,000. Uh and so the other thing that this does is it changes our rental opportunities that happen in the evening. Rentals were happening like on hour blocks, which generally by the time you show up to the pool, you get in the pool, get all the things going. An hour is not really quite long enough anyway. So this pushes our blocks to either a two-hour block right after we're done so our staff are not sitting around waiting or a three-hour block. So, uh, we wanted to present I wanted to present this and see if this is something that we feel advantageous to continue to move forward. But I think in the long run, it helps us to continue to stay competitive with our wages by cutting the costs, but paying what we need to pay our staff to be there and hopefully help us increase our revenue on the rental side as well.

Yeah. Megan, I hear I think that's great. So, so you would So, the the instead of renting it like from 8 to 10 Yeah. at night. Yep. and having them pay. They could they could do it from 7 to 10 or 7 to 9 or Correct. And we'd always start that rental at seven. So again, there's not a break where we're trying to have staff just sit around and do nothing. It just It'll be interesting to see what happens because I I would think that your rentals will actually go up because seven's a better time. We're hoping that's the case as well. Yeah. Not not quite as late. I love that you looked at this because I think this is the first time since I've been on the council that this has been analyzed and I think it's awesome because it doesn't make financial sense to continue with those hours if the revenue is not there. Correct.

And then it you're benefiting the the employees enabled office. So I love this that you took the time to to look at this. Yeah. I have one question for you. The 1 to 4% from 7 to 8, is that determined by people that come in from 7 to 8 and pay or is it people that have may have been there purchased a membership? Well, maybe they Yeah. How many actual people that maybe they purchased a membership or they were there from 5 and they are going to be disappointed because they're now being asked to leave at 7 instead of 8. That's actually a good question. I had Sean run these numbers and Sean's the kudos behind this idea. So, I want to give him kudos behind this. But his I don't know that answer. I can find out that answer for you if you want me to follow up on that.

My my thought is if if people are used to and they find the value of staying from, you know, 5 to 8 or whatever. Yeah. You may have a large population that's been disappointed for not being able to stay sure for the full value that they perceive, but and I don't know if honestly I don't know if our system is going to be able to tell us that number because it's really once they get there, but we're not tracking when people leave. You just track when they pay. Yeah. So that so in and in all fairness, there's probably going to be some people. We feel like it's going to be a small number of people that are upset by the change, but that is a potential obviously and and we could re-evaluate that really at any time during the summer. If we feel like that's a high enough group of people that are struggling with that, we could re-evaluate.

I think I think the question would be how many how many residents or attendees attend between or or purchase, right? Walk in between six and seven because they be the ones. Yeah, they'd be the ones till we could get that number. Yeah, that would actually be a good number to I don't think there's an issue with the ones after school. Like if you were opening at 2:30 or 3 or whatever that number is and you're just pushing it back an hour there because I think the statistic there is they're not buying it so they're not there. Sure. But it's for that evening. I wonder how many people are hanging around. Makes sense. And just I would just send that to Scott and he can mail that out. Okay. Yeah. I I don't have a problem. Oh, sorry.

Well, you could adjust if necessary. If you're getting complaints or you're seeing a large crowd come in the evenings, you can always adjust. Yeah, because at any point we could just start saying staff now we're staying open till 8. I mean, I guess that being said, there's not rentals kind of already in place, but we could start navigating that at any time during the summer if we wanted to. Is that something we can start advertising now to even get some potential feedback before the change happens? Yeah, it's technically on the website right this second. Can we do like a social media? Yeah, we could do more than that. Hours are changing and then just kind of see what the response is. Mhm. I think to Todd's point, if you're getting a lot more reservations pool and and earning the extra revenue because of that, that's a potential positive trade-off, too.

Okay. So, I'll what I'll do is follow up with some numbers. Um, and then we can kind of go from there. But let me know, I guess, if you ever, you know, if you hear of any other concerns or anything that come along, but we'll we'll continue kind of moving forward, but I'll get you some numbers so you kind of have an idea of what that looks like. Great. Okay. Any other questions? Nope. Awesome. Thank you. All right, Scott. Who's handling the budget discussion tonight? You. All right, we'll let you get hooked up. Be here if there's something I start going down the wrong path. So, we have a we have kind of a short agenda tonight, but we do have some budget discussions on the same thing. What's that? It's all centered on the same thing. Yeah. And so hopefully Scott can take care of some of the

I'll walk through all of it in preparation of our council meeting and also uh just with a general understanding on Is that screen on back there gentlemen? Is are we on back there? We probably want Yeah, we probably if you know

Can everyone see it back? Do we need to turn it a little bit? We're good. All right. Okay, pull up. I want to talk about uh property tax and just do a little educational part of this um so that we have an understanding of what how the property tax works. Oops. Okay. Uh, I stole these from a presentation at the Utah League of Cities and Towns. Um, Carrie Nakamura is a former city person that's uh, she now is a consultant for cities and she put a presentation together that uh, discusses and this is the presentation that I emailed to you last week. So, I'm just uh I'm just pulling a couple slides from it specific to the property tax. So, maybe I'm sorry if this is redundant for you. Uh part of this is uh also make sure that our our public is educated as well.

Yeah.

Okay. Uh so, property tax rates in in Utah revenue driven and so they just make a few uh points here. valuation increases do not result in higher taxes. So, every year when the county sends you your tax notice, uh they have a valuation of your property. Um I can't think there might have been a time or two when that went down that might maybe 2010 11 your valuation might have decreased. Other than that, you'll generally see an increase in your valuation. The valuation increases and decreases usually result in tax burden shifts. And so I'm going to show you what that means in regards to the revenue that the city obtains through the property tax. There's a natural downward bias in a property tax because inflation is backed out on purpose. So uh because of the way that the tax system is set up for the city to uh capture inflation, they would have to actually declare it a tax increase. And so on purpose um the today's dollars that or the dollars you were getting for property tax 10 years ago if you have not increased your rates um are lesser dollars than than what you would get uh in property tax today. Uh also a reminder primary residential properties receive a 45% tax break. So, if this is your primary residence, you have a valuation, you have a tax, they take your valuation, they times it by the tax rate, and then if it's your primary residence, then you get 45% off of that. If you're a business owner, then you're paying 100% of that. There's no 45% exemption. Um, most of these facts are not likely to change. This truth and taxation's been in place, I think, for over 40 years, maybe 50. It's been in a long time. And uh these parameters were set and cities have been uh using these parameters ever since. And unless there's a big change politically uh up

with the state legislature, I don't think that this is going to change. Um we we want to work to understand this complicated process. It's fundamental to understanding public budgets in Utah. Despite all of the above, property tax is the most stable revenue source for local governments and is the and is the tax over which local officials have the most control. So sales tax is a great example. We don't we can't change the sales tax rate for our citizens. The state controls the sales tax rate. Um and so because of that, um we don't if sales tax is going up or down or whatever, we don't have any say in that. the the city council, your avenue is property tax. Uh probably happens to be the most hated tax probably is fair to say for people to pay. Um but that is really the only lever you have to control as far as revenues, additional revenues for the city. Okay. So with that, I want to talk a little bit about um using these slides here. So, um, what you see here in the green is our baseline property baseline property tax budget. So, um, when we get our our our rate, um, the the, uh, tax rate, which the the county gives to us, and we'll get it, they're supposed to have it to us by June 1st. So, we're going to get a tax rate. that tax rate is going to either go up or go down based on the assessed valuation of the city as a whole. So we get a number for the assessed valuation of Pleasant Grove City in aggregate. Generally speaking, that number goes up every year. And so what happens is our tax rate is reduced. So when value goes up, so if this is what our number is, and the value goes up, they don't keep the value the same.

they reduce the rate so that we get the same amount of money each year. If the value were to go down, okay, which rarely happens, but if it does, then the rate will automatically adjust up so the city stays revenue neutral. Okay, so um this holds the amount of property taxes that entity receives constant regardless of changes in property value unless the council chooses to increase taxes to receive more revenue. uh this requires a truth and taxation public hearing and notice. One exception to this is new growth which is authorized by the county and state. So if we have new buildings built in our city then um that is considered new growth and that is additional property tax to us. So when you look at our property tax revenues over time uh we had one tax increase in 2022. Other than that any increases you see is just based on additional building being done in Pleasant Grove City. So growth is a factor. Eventually growth will become a non-factor for our city. In fact, that number has slowed down because we had a lot more growth, quicker growth uh probably 5 10 years ago. Uh but now I mean we still have some things going on out at the Grove. Uh but our residential has really really slowed down and so um our our property tax growth numbers aren't as big as what they used to be. So this is the example to illustrate um how the tax rate works. Uh this shows 10 homes. Okay, it shows the market value is 181,000. I don't know a single home on the market that is worth 181,000. But the reason they're using that value is just to illustrate the purpose because if you take um 55% of 181,818 that's 100,000. So if this is somebody's primary residence and the market value of their home's $181,000, they're only going to pay taxes on a h

100,000 of that. So if the tax rate is 1%, then they're going to pay $1,000 in property tax. So this shows the the math here. This is all 10 homes. This is the total one of assessed valuation at 1.8 million, but the base the taxable value is only a million. and then the city would receive $10,000. So that's a baseline there. So in year two, this is making an assumption that all of the values double. So the value valuation comes out, everybody's house doubles in value. Um the tax value goes up, the tax value is now 200,000, but they keep the city revenue neutral at 10,000. So they drop our tax rate to 0.5%. And so this is what we see. The the whole purpose of what they're trying to accomplish in the truth and taxation model is to make sure cities stay revenue neutral. Okay. So this illustrates that in year three. Um this is showing that different h homes have different values because this is more our reality in a sense that uh when we get everything in the aggregate we're just getting one big number. your personal house might have gone up a little bit more or less than what um than what the market says. And so it's not going to be dollar for dollar for each individual taxpayer. It's just going to be dollar for dollar to the city. And so if based on this some values uh go up or go down, we now have a taxable value of 2,227,000. 55% of that is 1,225,000. Um, but the city still is gaining $10,000. So based on no matter what the

valuation changes are, the city is getting the same amount of money. Um, and it changes our tax rate to 082%. That's what happens. And then the last one illustrates um what's going to happen if we get new growth. So, basically, it's the same one I just showed you, except for we're going to get an extra 1,200 bucks because we have an this is new growth. This is a new home. So, it's not part of the truth and taxation formula. Um, it's an additional revenue that the city will get. So, that's that in a general sense, that's how the property tax works in Pleasant Grove. And so if we don't change our tax rate, which we've done one time in the last 30 or 40 years, in essence, our residents are paying relatively the same thing. Okay? Now, if your tax bills like mine, mine has gone up, but there are other taxing entities that tax our residents. And I would say the school district is one that has fairly consistent increases. And to be fair to the school district, they don't have sales tax. that's not a revenue source for them. We do as cities. The the school district doesn't. They have weighted pupil unit and they have the the property tax. And so, uh, because of that, they lean heavily into property tax. And because of that, on your bill, most of what you're paying in property tax is going to the school district. Okay. So, any questions on that,

council? Okay. So, I just keep going. And and part of what I'm trying to illustrate is we lose purchasing power over time when we don't change our rates. Um in my opinion, the reason the truth and taxation went in was to make it difficult for cities to increase property tax rates. And for the most part, that's worked. That's probably been a good thing for the residents is that cities in order to go through this process. Um you know, the public is is very involved in this process. And because of that, cities for the most part are like, I don't know if we want to go through truth and taxation. And so, we're just going to continue to work with what we have and we're going to rely on sales tax growth or these other uh revenue sources. But what cities have found particularly in the last two years is as we've seen uh sales tax growth stabilize. We have more cities that are doing truth and taxation probably this year than I I don't know the numbers but I there are a ton of cities and I'll get into that because I have a a spreadsheet that's going to show that. I do want to talk about tonight's agenda so we have an understanding of what is happening specifically tonight. Um we this is a brand new process. Okay. This is a pro process that the state has implemented to make sure that our residents know that the city council even wants to consider a property tax increase that there is um there's going to be notice on your first meeting in May. In years past, um, usually it was in June when once we got our certified tax rate from the county, then the city would make a determination in June whether we were just going to adopt that rate and stay with it or whether we were going to increase that rate, which means that that kicks us now into the truth and taxation process. There was some feedback uh from the public to state legislators saying that's a little late

in the process. We don't find out till June. Um there's a uh most truth and taxation public hearings are after August 1st and so there was this two-month window between June and August 1 uh for public input including a truth and taxation hearing which is required by law. So what they've done is they've said we want this to be a little bit more upfront and so we are telling cities that you need to uh notify the public if you have this intention. And so that's what we have. And you when you see our agenda, we have two discussion items on this and we have four resolutions. Now, we've looked at other cities agendas and how they're handling this because this process is new. Um ours is probably a little bit overkill, but we just want to make sure that we're covering every base that if the city council wants to consider this, then um we would need to pass all four resolutions. Um if the city council doesn't want to consider the tax increase for this year, then you would just vote no on those and we would we'd be done for this year. Um so what is in these resolutions? Uh number one is to adopt a tenative budget. Now we are already required by law to do that our first meeting in May and in years past if we were considering a tax increase it would be in the tenative budget. The state wants that to stay um intact. The main reason I think is the state wants the public to know if they're looking through the the tenative budget that there is notice in that budget that a proposed tax increase is being contemplated. And so because in my mind it's like well if we're if we're going to do this then why do we have to put this in the tenative budget? And what the state is saying is we want the residents to know we don't want you in essence hiding this by not putting it into the tenative budget. So they require us to put it into the tenative

budget. Okay. So um that is one of the resolutions for uh tonight is the tenative budget. Uh and then um in item B there. Well, let me jump ahead. Um Scott, can I ask you a question about tenative budget? So part of my understanding was with this new law was that we we essentially had to have a contingency plan. Yes. So we were going to a tenative budget with property tax, but also understanding that if a property tax does not pass, then we would have a different budget that would be available that that is kind of running two different getting ready to cover that.

Okay. Well, I'll let you cover it. Here we go.

So, when we get into June, uh what we will have, and I'm I'm probably skipping down to the number three, the truth and taxation timeline. In June, we will have a public hearing on our budget, on our tenative budget. Okay. So, that will give uh public an opportunity and as and I'll get into this as well. We have what's called a a property tax uh impact statement. Anytime we talk budget between now and we adopt our budget, we are required to read this statement to the public. And so, if we have budget discussion on May 19th, this will be an agenda item to talk about the impact statement. When we get to June 22nd, when we adopt our budget, at that moment, that that tax increase is pulled out of the budget and put into an what we call an expense account, which um in essence, if the city council at the end of the day decides not to do the tax increase, that goes away. So, it will not be in our adopted budget on June 22nd. We're not allowed to put it in the adopted budget. In the past, in the past, you would not adopt your budget until you had truth in taxation, which caused cities problems because July one you start spending money on your current year budget and you still haven't fully lined up your revenues. And so, the state is saying, "We want to get away from that. We're going to have you put this into an expense account and you're going to say specifically what the money's for because then if the property tax does not happen, that goes away. whatever whatever it is in that. We've been quite clear at least in our budget sessions what what we're requesting the staff through the property tax increase and and when we read the proposed impact statement tonight um it will it will outline all of that and it will show that. And so this is a message because what has happened in the past um there would be cities that they would already in essence start spending the money

before they had their truth and taxation hearing and they want to avoid that. They want to make sure that this is outside of it so that if it doesn't happen, citizens don't feel obligated because some of the money's already been spent um or that the council doesn't feel obligated because some of the money's already been spent. So, this is a change in the law uh for the better so that um it holds our feet to the fire to say, "Okay, we have a very specific purpose for this increase and here's what will happen if here is what happens if it passes. this stuff goes away if it doesn't. So, tonight is adoption of the tenative budget. We will also create, we've already created, and Denise, I think, sent this out to you last week, but we will review the property tax impact statement. Okay? And in this statement, it is required that either the finance director or the mayor reads the statement. Okay? So, we'll have Denise read the statement when we get to that portion, but that's a specific resolution. we'll have a res resolution that um sets our public hearing for August 11th. Okay. So, we've already the the we already have to give that date to the county because we cannot do it on the same night as Alpine School District or any other tech uh taxing entity that is on our bill. So, generally speaking, in Pleasant Grove, you have Alpine School District, Utah County, um Pleasant Grove City, Central Utah Water, and um the small one, North Utah Water Conservancy District. Okay, so those are generally the five entities that are on your bill. We cannot hold a truth and taxation hearing the same night as any of those other entities. Uh Alpine School District claimed August 4th. They were first ones at the table. Most cities, I think, in Utah County are that are not part of uh that are part of Alpine School District are looking at August 11th. So, we need a resolution that's going to set that date. And then we need a resolution that is uh

preparing for the regulatory things that we're required to do for June 22nd, which is adopting our budget and uh pulling out the the proto the proposed tax increase so that it's off to the side. Um just as I explained, this is all regulatory stuff to make sure that our intentions are clear when we discuss this with the public. So um this is the of the process. Um if the city council approves these tonight, this is the city council saying we want to consider it. So now um now we need to uh educate the public and let the public know what what the intentions are. At any time the city council can pull the plug on this thing. At any time the council can say, you know what, May 19th, June 2nd, June 22nd, we've changed, not changed our mind, we have decided we don't want to do the tax increase. You can even do it uh on August 11th after we have our public hearing. That is when it's actually enacted. So, I I think there's word out there that we're doing a tax increase tonight. That's not true. We can't by law do it tonight. The earliest we can do it at this point is August 11th. Okay, that's three months away. And so in any time from tonight to that to that end date, the city council can say we're not doing this. Okay. So, for tonight, um, what I would ask of the council is that we adopt the resolutions tonight so we can start the process unless the city council has decided we just don't want to do this period. If you just don't want to do it, period and you vote no, um, and then then it just we're done. The property tax is off the table because we have to adopt these tonight to keep property tax on the

table. Doesn't guarantee anything. doesn't ensure anything, doesn't um hold the council to any sort of obligation to the property tax uh increase. It just opens the door for us to consider that. Okay. So, are there any questions about the process council?

Yeah. Um so, let's I mean, I wish our city attorney was here because me too. there be the law is uh like you said I mean there's been some statutory language added but the question that I have is regarding the impact statement which is a new aspect of the law if we hypothetically were to adopt the resolutions to consider the proposed property tax are we allowed at that point some flexibility in moving the impact statement from what it is and being presented as I think you can reduce it. Not not increase, but you

Well, I No, I think tonight locks us in on what our number is at the high point. At a high point. At the high point. But but you I mean because I mean we'll we can have a further discussion. I'm sure we will. I'm really quite ler about the number honestly. So I mean if we're locked in at at the number that's it's on the impact statement, then I don't want to pass it. So I don't know what the I don't know what the lie is.

My understanding is uh when I mean for instance we get into our truth and taxation hearing on August 11th and there's some uh push back from the public and the council's like you know we still want to do this but maybe we need to reduce it. My understanding is is you can say this is what we want that number to be. We can't go over. Is that your understanding? Correct. But we can't reduce it before then because if we find there's a more appealing number, that's what I want to have the truth in taxation on, not the highest number that's been proposed. I'd rather do that before the truth in taxation if we decide to go down that route.

Yeah. I mean, so let's say we get into June and the city council is like, I'm not comfortable with the $4 a month. We want to roll it back to $3 a month. And we just change the impact statement as we read it. Well, and that and that's I mean also I want to be clear like August 11th I don't think it's the only date that we can receive public impact like public input, right? I mean we've talked about um No, it's the only required public hearing specific to the tax increase.

But the the statement of public input I think through the three months that's going to be the process that we want to solicit that input. That's exactly that's exactly what the process is and this is why the state's doing this is we want you to have a three-month dialogue instead of a a two-month dialogue.

And so that's exactly right. Once once the intention of consideration, now we have the dialogue with the public. Okay. So whether that's let's do a survey, let's do a open house. Uh in years past we did an open house. We do an open house, we'd send a notice to every single resident in our community. Hey, we're meeting six o'clock on this night. We do it right here. We'd have the information available to the public. They'd come and ask us questions. You usually get 50 or 60 people that would turn out. The idea is educating or

Yeah. I mean, the intention would be to use all available forums, right? I think I think putting it on the water bill and making sure we have maybe a some sort of a link where people can submit comments that we can review. And I think I I I just think that the most broad approach in engaging the public on this and maybe right now is not the time to have this discussion because we're going to have I actually want the public hearing that we're going to have just the public

meeting the open session. I think there may be some people that show up to share their thoughts during open session. I'd like to hear people who are proactively kind of engaging with this dialogue and then maybe have this discussion as a council. But um yeah, I mean I think that's I if we were to adopt these resolutions, I've got some I I do have some trepidation that I've already expressed. And so I think that uh yeah, that was my question was just I want to ensure under the law that we read an impact statement that we're not locked into that impact statement through the whole process. That's my understanding.

Tina is not here. Um, if for some reason it locks us in and you're not comfortable, like I said, we just pulled a pin. We just pulled. It's all or nothing. Yeah. Hopefully that's not it, but okay. Yeah. Well, that's something we can have her I mean, she's landing, but something she can follow. She's not going to be able to answer that off the top of her head. She can answer that this coming week, you know. Yeah. the law's complicated enough and there's diff there's enough areas that were changed not just in harmony that I think yeah it's going to take a little bit of looking into because and I think we're all familiar with this because this is the first year of the new process there's going to be some bugs in the process that people are going to figure out as we go

in which I think the state legislature will probably look at the bugs and try to clean that up for next session but we're going to have a little bit of that moving forward and what you're asking is is a good question I I So previous to truth and tax or sorry previous to this process the impact statement the city always had the flexibility to reduce it just not go more than what was announced what was put out because uh in July the residents will get a property. So, we will when we adopt our budget on June 22nd and if the council still wants to entertain that tax increase, then we notify the county what that is. And then that then it goes on the property tax notices that people get in July that has their new valuation. It also lists when the public hearing is and where it's at. And that's that's been the same the the the last time we did this. That hasn't changed, but but the council has to make a decision to say yes, we're still willing to entertain, but again, it doesn't lock you in because you still have to have that public hearing. But to your point, we we can have engagement for the next three months with the residents and we can figure out how broad that's going to be and what that, you know, how that's going to look because part of this is making sure the the public knows why. You know, I mean, we we showed you the information last week that explained why why we need more uh firefighters, why we need more police officers. That's stuff that the public ought to know because if they look at that and say, you know what, I'm okay with $4 a month in order for us to have an increased public safety presence, then that's an education process. The PE, if there's people coming tonight to speak to it, I don't know how much information they have. I don't know if they've seen our handouts. I don't know if they've seen this process as what I'm explaining. So, which is fine. I mean, people can comment on that, but I just

would caution the council until we have an opportunity to educate our residents. Um, now if it's I just don't want property taxes period, that's fair enough. I mean, they can come make that comment. Um, you know, but that but that's stuff we haven't really put out just yet. I mean, That's because this is step one in the process. Can I ask you a stupid question? Yeah. All yours. So, I know you get your numbers for the city on the aggregate. You get that, you know, billion dollar number divided by the number of houses and we've got $4 is what we've got. Does it actually play out as $4 per house or does it play out to where No, sorry. That's on an average home. Okay. So,

no. So, that's on an average home. So, if you're Let's An average home is 550,000. I I hate last year. Is that on an average personal residence? Yes. Yeah. Single family home primary primary residence. Okay. 5765 last year.

So some might be 10, some might be six, four, and two for those that are. So, if your home is assessed at $800,000 and the average is 575, you're probably looking more like$6 or $7. If your house is 300,000, 400,000, then you're going to be a little less than the $4 a month. Wait, is that on the assessed value? But you're talking about the actual value of 570, whatever, but then they're assessed on 45% less than that. But we're talking about the actual value of the property. Yes. That's not right. No, that's not right. You're It's It's the It's the assessed value minus the minus the 45%, right?

That's That's six to eight per month. Oh, no. No. Yeah, that's correct. I thought what you were asking is the 575 after the 45% or before the 45%. But it's it's before the 44%. Yeah. Well, I think what you said, one of the things you said, Scott, which I think is very important, is that because we're going through a new process and we I think everyone on the council agrees that we want the public to un to be fully informed of what we're doing,

that we be yeah, overly cautious and making sure we're sharing as much as we can. Um, just to make sure that if there's bugs or any kind of hiccups or some maybe poorly worded statutes. Yeah. Then we are being overly overly cautious. That's why we have what we have rather than right on the line. Yes. Okay.

Yeah. Trust me, our agenda is probably a little more robust than most cities and we're just making sure we're trying to cover every base as far as that's concerned. So, yeah, I would I would air on um making sure we have um more as opposed to less. um and we can get into if the council tonight says we want to entertain this and we then we can have the discussion on how you want to roll that out to the public. So in in the past we've done we've mailed a flyer to every residents. In the past we've put it on our social media. Um usually the biggest one that catches most people's attention is when they get the tax notice in July. Um but and we do the open house. I mean those are things that we've done in the past. I know the idea of a survey was brought up. I I kind of like that idea. We just need to make sure we can craft the survey with an understanding of if uh the public needs to understand the need. They need to understand what we're asking for, why we're asking for it. So that when they say yes, I'm okay with that or no. If it's just are you okay with the tax increase or not, that's one way to survey. But if we're going to ask for a tax increase, I think we need to tell them why we're asking for the tax specific how the question is asked. I think surveys do a great job of manipulating responses with how things are asked.

Well, and I and I don't want to I don't want to I don't want to manipulate any of that stuff, but there are companies that are pros at doing surveys. So, we we engage with the company and say, "Help us craft these questions so they can be as neutral as possible, but yet educate the public on what we're asking for." Yeah. I think my point in in in discussing paying for a third party survey is that we we just want the uh actual um feelings of our residents. Yes. You know, it's not it's not hey, we want to try and sway it one way or another. We want to express what do you think? What's happening? Yeah. What do you think?

What's going on with our public safety? Uh we'll discuss alternatives in in in open meetings here as well with the budget and why we're are asking for what we're asking for. But I I I ultimately just want to ensure that we understand as best we can the general residents feelings of what we're proposing because it's a big deal. It is a big deal.

Yeah. Hey, we've been we we did this four years ago and I mean there was a lot of input and and a lot of feedback and and I felt like we did a pretty good job reaching out to the residents and we can do that and some more of what we did four years ago to help the public understand what the why to to that point. Okay. Um on the timeline, I think I've covered this. June is June 1st is when we notify county and state of our intentions, including our public hearing date. Um if the council adopts that resolution tonight, the county already knows because we had to tell them two months ago. Um the state we would notify that our date will be August 11th. June 2nd will be proposed hearing would be the public hearing on the proposed budget which would include also the property impact the property tax impact statement. June 22nd, we we would adopt the intended rate. Okay? So, they're going to give us a rate. The county is going to give us a rate. We will adopt that rate. Okay? And that is does not include the tax increase. And then off to the side, we will have the paperwork that says we have an intention to increase the rate x amount of dollars or x amount of percent to account for the dollars. And then that will be in in a separate expense account. Um, one of the frustrations that cities have is we are having a discussion on this on the amount. So, the $4 a month and our evaluations when we don't get those numbers from the county till June 1st. So, my assumption is right now $575,000 is the assessed valuation on an average home. On June 1st, that number is going to be more than that. My guess is it I don't know what it's going to be. Let's say 600,000. um our propert then they'll show our rate is going to come down. The $4 a month will be less than that. I don't

know what I don't know if it's going to be $3.90 or $3.80, but we'll do the calculation if we're trying to capture $683,000. Then we'll say this is with the new rate. This is what it's telling us with the new valuation. It's really the new valuation. This is what it's telling us um in order to capture that revenue. So June 22nd, we adopt the intended rate. We include the property tax impact statement in the budget and then we adopt the interim budget with increased property tax and a restricted account. So that's that's where we pull it out to make sure that um if the city council decides not to do it somehow it's still in the budget. That's that's not how it's going to work. So I just have a few minutes real quick. Um this is an informal survey that I've done with uh the on our city manager lift serve. I've just asked um cities uh are you considering a tax increase this year?

So again, that's cities who are taking this first step, not cities who have committed to actually adopting. Well, they can't. Yeah,

I mean they're they're in the exact same place we are, which is they want to consider it. This is what's being proposed. So these are all the cities. Um, and I'll I'll uh email you the spreadsheet, but uh this gives you an idea of the percent increase and then the monthly cost to average primary residents. Not all cities filled that out. Most cities did. And then what they were uh what the intention was with the property tax increase. And so as I scroll down, so I we have I we have, you know, handful of cities that said yes, handful of cities that said no. So here's the stats. And this is a little bit of a moving target because I just sent this out yesterday morning and I still have people filling this out. So this was as of about two hours ago.

Could be not responded then.

No. No means there's no intention to to increase the taxes. Um I ask people when you fill this out if you're not doing it please put we want to know you're not doing it. I just don't want all the yeses. I want to if you're a no, let me know that. So cities that have responded 57, those considering property tax increase are 27. So just under just under 50%. And those that mentioned that at least a portion of the money was going to be for public safety was 17. And so I broke out just Utah County. Now again, keep in mind they're having the same discussions we are. These could go away. The cities could say we're not doing this. And so we just this is a snapshot in time. So, cities that are considering an increase, Saratoga, Santa Quinn, ORM, Cedar Hills, American Fork, Springville, Eagle Mountain, Lehi, I mean, they were like, we just don't know. The staff is proposing it, but they're probably in a place where they won't know until they have this meeting. Um, and and the increase PS means public safety. So those that are specific to public safety only, Saratoga, ORM, Cedar Hills, American Fork, Eagle Mountain, and then Santa Quinn, Springville, and Lehi were partial public safety. So not all the money was going from public safety. Uh cities in Utah County that aren't considering an increase, PAC, Alpine, Lindon, Mapleton, Spanish Fort, Provo. Those are just the ones that responded to the survey. So, I just I wanted to um just show that we're not the only city that would be considering this. Most cities are running into the same issue that we are, which is if we have a sales tax that is leveling and we still have these needs. Then,

Scott, how how can we have sales tax that's leveling? Can you just explain that phrase to us? When I say leveling, um, it is less than what it has been in the past. So, we've had increases of 8% 9% year-over-year. Um, we're proposing 3.9 4%. I think it was 3.9% this year. I proposing budgeting. Budgeting. Yes. Sorry. That's what we're budgeting. Um and so what we're when we see the sales tax why why are you budgeting lower this next year than previous years because we are increase it's a lesser

increase lesser increase revenues key I knew the answer I I kn I knew the answer to the to to to the question but you hit it spot on say that again well I think it government mentality on national level is you know budget cuts means you just spend more less more than you spent more the last year or whatever. It's not an actual decrease in spending. It's it's decrease in increase rate. The marginal rate. That's right. It's that marginal rate which is actually an increase in funds. Just a lesser increase. Yes. As a percentage. Yes. Thank you. And that and that's I mean that's a fair state. So So our our revenues haven't you you said our revenues have have flattened. That's not true. The rate may have flattened. The rate of increase

the rate of increase may have flattened. Yes. But the revenue, total revenue has actually increased. No, that's true. That's true. What the nuance is is that that 4% is what we're using to pay for the salary increases this year uh to make one employee full-time to account for pulling some money out of the capital budget and putting it into operational, that 4%'s covering that. And so when I say in the past if we had an 8% increase, we would probably have another $600,000 to work with and we'd probably be able to fund these positions without a property tax increase.

Can you talk to me about um the methodology of determining four versus six versus eight where that drop off is coming? So we we get a report each uh week each month um that shows a rolling percent of our um sales tax revenues over the last 12 months. And so the last one we got was showing 4%. And so um now we had a good month in the one we just got. Our revenues were a little bit higher. And so our rolling went from I mean it just shows it at 3% 4%. It doesn't show it at 3.5 3.6. And so we saw that number. That's why we made the adjustments in the budget last uh time to account for some of the things that the city council requested was in order to account for that we made a change in our sales tax revenue based on one month. And that one month uh was probably a difference of you know $30,000 or something like it's not we're not talking $600,000 changes when we get our monthly tax report. Um the the swings are not that wild. The um and so that is our methodology is we're looking at what it's been the last year. We try we try to look at national trends. We try to look at Utah trends. Um, Utah economy has stayed better than most states. That's why we still have a 4% growth. I would imagine in some states they're probably seeing negative growth in their sales tax. Um, but we we do our best to try to, and again, this is a conservative approach. Could we bump that number to 6%? We could, but now we run into, and I'm going to get into this. This is what I call aggressive budgeting. This is when we're saying, "Okay, we think we're going to get six." There are no indicators that say we're

going to get six. Our indicators right now are saying that four has been our rolling number. We're we're comfortable to stay with that. But if it if we start budgeting that extra 2% and building that into operations and then we end up at 4%. Now we're dipping into reserves. We're trying to figure out where that money is going to come from. If it even goes less than that and two, let's say we budget 4% now and it comes in at 2%. Then we're probably dipping in res reserves to cover that. My goal is that we don't have to ever touch reserves. I want to make sure that we are in a position that when these revenues come in that if they do come in at 6% now we have this extra 2% of revenue generated and that's what we roll into our capital for the next year. So that I mean that is my philosophy. This is how I've done it for 20 whatever years and I I understand that that is maybe not where everybody's at in regards to how aggressive that you want to see the budgeting. I just don't I am trying to preserve reserve accounts. I'm trying to preserve um the city's just financial viability in the in the long term. So that that's the philosophy. That's how we come up at the 4% number. Um, and I, uh, you know, again, if the city council is like, well, I mean, that's a little too conservative. I want to see this differently. Then we just need to talk through the consequences of that. If we're going in eyes wide open, that if we're going to push that number, for instance, let's say we push it so that we can fund uh, these new officers and new firefighters without a property tax increase. We can push that number, but that's all it is is a number. as the actual revenues come in, maybe things pick up sales tax-wise and we're good. I don't know. That would be ideal. That would be awesome. But that's a risk we all take because if the numbers stay at 4%, now we're looking at pulling 600

some thousand dollars out of the reserve account, which is only $4 million. Like, it's 4 million sounds like a lot of money. It's not a lot of money. And so to pull $680,000 out of the reserve account, it's just I don't want to go there. I don't want to ever propose to a city council that we're using our rainy day funds. Um the only time we used them was 2010. And we used them because we had a major downturn in the market. Sales tax went down for the first time in I don't know a long time at least since I've been in city government. Um that was right when I started here in Pleasant Grove. We had a $500,000 deficit that we had to go into the rainy day fund and most cities did and we still laid off six people. Like we made some hard decisions in order to balance that budget. But that those are things that I would you know if we if we go into a recession nationwide, we're having a way different conversation when it comes to budget. I mean it is now a conversation of okay, what services can we pull back on? You know, what can we do to to lessen this? And so that's those are this is just ex this is just my experience in city government and in in budgeting and and again it's a it's a conservative approach.

So yeah it's it's hard to explain to the public and I guess why are we assuming the sales tax revenue would go down with all the new businesses coming in that have come in and are continuing to come in. I mean hotel but not just businesses but people like the Grove area. Why would we think that that would continue to go down? And how do we explain that to the public? It's not it's not going down. The revenues aren't going to be careful. No, no, no, no. The the rate is flattening. The revenues are increasing. The rate of growth the rate of growth and the rate of monies is increasing. Yes. It's a play on words. And then this is how we need to we need to be careful explaining this to the public because the general public's not going to like spot on.

What you hear is that it's not revenue is not increasing. So now we've got to go ask them. No. And for me, look, I apologize when I say flattening. Flattening to me is we're not here anymore. We're now down here as a rate, not as revenues. Rate of

because I want them to know how hard we've worked to bring business in. And because the whole point of bringing the business in is to increase the sales tax revenue so we don't put the burden on them. Whether it's for roads, public safety, parks, it doesn't matter. We're trying to take the burden off them. And for me, I don't necessarily if it's been 20 years of conservative, we might have to change the way of thinking to be more aggressive because of what we're asking of them. From utility rates to Cook Park to property tax increase to roads, we're asking a lot. And for me, that should be the last person we go to is the public and the residents. I would rather be aggressive. That's this is my opinion. I want to be aggressive with our budgeting so that they are our last resort, not the first resort. And it's hard to explain this to them when I mean, honestly, they're not gonna it's not going to be like great versus this versus flattening. It needs they're going to see the amount of businesses going into the Grove and wonder why we're going to ask them for more money because we have the sales tax revenue coming in. We've already asked them for all these other things. I'm fine with being more aggressive to not ask them for more.

So, the the sales tax revenue coming in does not cover the additional needs that we need.

Then that's a discussion we need to have as far as maybe we stagger the needs. Maybe we ask maybe we don't fund every single thing we're asking for. I and I'm not just talking public safety. I'm talking in general. Is there other ways we can budget so we don't have to go to the public and ask them for this? At least this year. People have been laid off. Inflation economy, the school district increase. It is so much right now. I don't know if I feel comfortable going to them with definitely not a 16%. I mean, I'd like to see the numbers at a 3 to 5%, but this is hard to explain to them when all these new businesses have come in. And I know that's not going to fund everything we want, but we might have to pull back on some things that we want and need, so we can stagger it so we're not going to them.

Yeah, I I agree. And if the council is saying we're not going to fund it, we're not going to fund it. I mean, I I understand, but there's there's a way to maybe not fund it at 16%. I mean, I'd like to see the numbers at a lesser amount. Well, no. And we can give you the numbers at a lesser amount. It just means we dial back how many uh firefighters and police officers we're getting. That that's one of the things I'm saying and I and that's part of the process that we're starting. Well, sure. I mean that is the process we're starting and I know we're out of time. I just want to end with one thing on the sales tax.

Um there is a formula that we get sales tax. 50% of it is point of sale. So if we're getting new businesses, we're capturing that's half that's the money all goes to the state. Okay? All sales tax goes to the state. the stuff that's generated point of sale, they give us 50% of that back. I need to say this the right way. We get what's captured um point of sale, but the other 50% is dist distributed by population. And Pleasant Grove's population right now is we're not Saratoga, we're not Eagle Mountain. Our population as a percentage of the population of state of Utah is going to continue to decrease. So that 50% even though we are getting new businesses in our community, that's additional sales tax revenues that are not going to be coming to us anymore. And so and I don't like I don't know exactly what that number is to say what that impact is, but that's that is the formula that we deal with with sales tax. So we can see businesses coming in and that's awesome because that is currently what's funding. Like if we didn't have businesses coming in, then we're probably looking at a property tax increase of $15 a month. I mean, it's it's just a whole different situation. We are fortunate that we do have the growth. We are capturing that. The numbers that the state is telling us is 4%. And if we want to get more aggressive, I would not recommend it. But if the council, if the majority of the council says we want more aggressive budgeting, then that's fine. Let's have that discussion. Let's take that vote. I just get nervous that that could bite us in the future.

Yeah. So, I I mean, I do have more to cover, but if uh let's get to work session. And I I don't know, mayor, before we have open session. Um if you want me to review this, um or I've put that down after number four of meeting agenda approval that we'll have you get up and address some of these issues. All right. Thank you. Okay. With that said, uh council, I need a motion to adjourn from work session. So moved. We have a motion by Council Member Williams. I have a second. Second by Council Member Rogers. All those in favor? I. It's