Redding City Council - Regular Meeting

All right. Welcome, everybody. We're coming out of closed session. Do we have any reportable action to report?

Thank you, Mayor. Yes. On item 3B, the council voted unanimously to authorize the initiation of litigation. The action, the defendants, and the other particulars shall, once formally commenced, be disclosed to any person who asks.

Okay, thank you. And we are in recess of closed session. Our intentions are to go back to closed session after this meeting. And if we have any reportable action at the conclusion of closed session, we'll come back and report that at the end. Just a good reminder for everybody, members of the public are invited to participate in city council meetings either in person or remotely using the city's online public comment platform located on the city's website and instructions are included on the agenda. Meeting agendas and staff reports are available at the www.cityofredding.gov and also in the public view binder located on the podium on the north side of the chambers. We're going to call this meeting to order. We'll start with the Pledge of Allegiance. And after that, we'll have our invocation by Patrick A. Blewett, who's the Executive Dean at Simpson University.

All right. Ready, start.

I pledge allegiance.

Let's pray. God of heaven, we are thankful for this city, and we're thankful for a new Jewish new year, Rosh Hashanah. Make this a sweet celebration for us all. Thank you for this council. Thank you for the staff of this city. Thank you for these participants and observers who are here. And Lord, we want to thank you for providing for this city a new cancer treatment facility. How wonderful that is. We ask that you provide for our city the staff that we need. We ask that you provide the funds that we need. And we ask that you grow our community so that we can continue to expand. Lord, and at this point, we just want to ask that you protect our schools as we start a new school year. That you protect our kids and our teachers and those who are involved in community leadership there. And we ask all these things in Jesus' name. Amen.

Amen.

Thank you. Thank you, Patrick. We'll start with the roll call.

Council Member Odette. Here. Vice Mayor DeNuca.

Present.

Council Member Munz.

Here.

Mayor Pro Tem Reisner. Present. And Mayor Latav.

Here. All right, just for some housekeeping and information, if anybody has come for item 9.11D, that was a consideration to update the project cost for the City of Reading Organics Diversion to Energy Operations Project, also known as Rodeo. That could be very confusing, but that is pulled for tonight. I don't know exactly when that will come back, but if you are here for that item, again, 9.11D, that item has been pulled and will not be on the agenda tonight. We're gonna start with a public comment. We're gonna jump right into that. We have four speakers here. I've got Robert Sid. I have Mayra, did I pronounce that right? You'll have to tell me if I got it wrong later. I'm sorry, Mayra Monarch. And then we have Nick and Leslie. So four speakers, if you guys would all like to make your way up there. So we'll start with you, Robert.

Maybe I was hoping to have enough time to get my to find my, my notes, but I basically just wanted to say. I know that we're in a bit of a pickle right now with having no permanent city manager and I think that. It would behoove us to make it to make a decision on 1 of the final 1 of the finalists who. as far as I can tell, has been doing three jobs very well and deserves our support. And I'm not sure what the impediment is. I did hear today that there was something along the lines of reducing RPD. If that was the case, then I'm sure that that could be worked out, because I'm not for reducing RPD at all. In fact, we're 20 positions short And we need to figure out a way to get that back up to where it needs to be. But there's middle managers. There's all kinds of different ways we can look at it. And you don't throw the baby out with the bathwater. I think Michael's a good man. He's done a good job. He can paint a nest on his shirt, you know, and would that be good enough for you? I don't know. Like I said, I don't have I'm not privy to the report or what was suggested. I'm just going on what I can see from an outsider. And it looks like he's doing a really good job. And honestly, you know, if we lost Michael, we'd be in deep yogurt. You know, pardon my French, but we would be just in a world of pain because this is a guy who like the last guy, you know, Michael, when you leave, turn out the lights that knows what's going on. You know, we don't have a finance, we don't have anyone with that institutional knowledge that can do the work. So when we're criticizing people, who are we criticizing? We got to point it at ourselves. You know, you guys are responsible for this. And I think it's disingenuous to throw the baby out of the bathwater and say it's somebody's fault when you guys voted for this. Thank you.

Thank you, Robert. Myra, you're up next. And again, reminders to save time if you'd like to get up along the wall so you could be up next. We'll have Nick and Leslie after that. Thank you.

My gosh. I'm one of the little ones here. Good evening, honorable mayor and members of the council. My name is Myra Monarch. I am a resident of Reading. And I am here to respectfully ask that a cast equity resolution be added to the next meeting's agenda. Cast is a form of discrimination within the same group of people from the same origin, usually based on birth. It happens across many cultures as a community organizer. I have heard many stories of caste oppressed individuals, and although this is a big problem across the world, in the US, throughout California, it's very prominent here in our own backyards. I have spoken to people who have experienced these caste oppressed practices from people from Japan, Latinos, African Americans. Ukrainians, Romanians, South Asians, and the list goes on. People are so afraid to speak up about this problem that they don't want to be up here. And a lot of children find out about their caste when they're in third grade. It's a big problem in the education sector, in the healthcare sector. It's pretty much everywhere. And I just... feel that I have an obligation when I hear these stories to do something like you. I feel like I'm here to serve my community and give back to this wonderful nation. And I've been working with cities all across the North State very successfully, have gotten resolutions to pass unanimously. And I would love to follow up with you via email or give you more information. I'm open to discussing this further over lunch. I know you're super busy. But I would greatly appreciate the opportunity, and I look forward to coming back here and speaking on this serious problem in more detail. I can answer any questions briefly if you have any for me, but that's what I have for this evening. Okay, I should mention that the resolution passed in Anderson, according to Hema County. letter of support from the Shasta County Board of Supervisors. It passed in Mount Shasta. The list goes on. I'm working everywhere. Thank you.

Thank you, Myra. Myra, if you have a copy of that, maybe you can leave that with the city clerk. We all might like to look at that later, but that's just an option. So, thank you, Myra.

I've been paying attention to the Closed sessions, and I just glanced over them. I don't come here, but I saw where Jackson Baker was suing the city of Reading for $28 million, and I don't see it on there anymore. Is it settled? Can you give me a yes or no? Is it settled?

Can we comment on that to our city attorney?

We can provide a brief response to items that are not on the agenda, or you can direct the commenter to staff for communication or?

Well, he's suing us, the people. We should be able to know whether it's settled or not. That's the point I want to make. Why is it in closed session?

I believe we can give a short response. Yes, no, and very limited details. We'd be fine with that. That would be to the person of most knowledge, I'm sorry.

Yes or no, that's all I want.

Yes, Mr. Gardner, we've worked out the details and I believe that lawsuit is finalized.

Okay, thank you. Am I privy to the details or is that secret?

I will have to get back to you on that, on the details we can share at this time or that we came to conclude.

It should be open. It's settled. It's public business. It's our business. We're the taxpayers. We're the ones that are getting sued. There's too much going on in closed session, in my opinion. That being said, you've all seen the clowns. I saw them up at Bocelli in Cyprus, and I whipped in and talked to them. They've got signs that says, dead pedophiles don't reoffend. Um, they asked me to ask you if they could make a presentation here. So, uh, would you want to have the clowns up here to hear their side of the story? White by dead pedal? Pedophiles don't re, offend. Well, we'll check that out later on the Henderson ditch. There was four houses flooded on Birch Way that their wells were contaminated. Two were major damages. One was 30,000. The other, the house burnt down as a result of the flood water coming up and charging, causing a short in the water. Electricity all it needs to do is be cleaned out. You guys have found millions of dollars that were hit in the way you could clean that ditch out for 10,000 dollars. You could even split it with a county and get that problem alleviated further down on the ditch. A couple 100 yards. The dyke there's a hole in the dyke the dykes about 5 foot tall it gave out and flooded probably 8 or 10 houses. 1 guy has 200,000 dollars worth of damage. Why haven't you fixed that? It's a hole in the dyke. Okay, you need to pay attention to that. Thank you.

Thank you, Nick. All right, Leslie, you're up.

Okay, so not to ever play off of anything that Nick says, but I do believe Dr. Danuka, you asked about where we were on that hotel that's housing, well, multiple hotels that are housing some off individuals, still not on the agenda. So that'd be great. Thank you for asking. Please don't let that go. We'd like to see some answers moving on legislation. We had over 1200 bills passed through this legislative cycle. That's fun, right? Because in California, we don't know what's going on anyway, but let's pass 1200 new laws. Some of them absolutely topsy turvy and kind of crazy. Like, let's redefine a woman. Or let's not, that would be great. So that being said, AB 2700 was one that was unanimously agreed on by both parties went through. It's still on the governor's desk waiting to be signed. Why is that? Well, because the biggest backer of all of his wife's nonprofits and of all of his campaigns has been the utility companies. So I'm going to speak your language, Mayor Mike, for a moment. Subrogation. You know what that is. That's where when your insurance company pays out for something and then they say, hey, wait, you weren't at fault for this. So I'm going to go after who was. Well, Governor Newsom knows what that word means, too. So he's looking to create his own legislation. And we're going to be watching that over the next like 90 days because he's going to try to slip something in before he has to sign AB 2700. Because, again, it had unanimous support from all of the lawmakers. That doesn't happen often in Sacramento. And he wants to make it to where subrogation does not apply to utility companies. Hmm, funny how that works. That means we, as the payers of those bills, have to observe that cost. So, yeah, we all could afford for our utilities to go up, right? Yeah, no. So we're going to keep an eye on that because that's ridiculous. And when it does come forward, I really hope this body writes something in objection to it because that would be great. That being said, I also want to follow up on where are we at on Shasta Supermoto? So I've never met a more, and granted I met them because they were here speaking, I follow up on this stuff. And I've never met a more deserving, hardworking group who poured over 13 years into our community, who have been right through the coals, had their entire organization flipped upside down over the past year plus. And still, they submitted part of an RFP. The RFP was kind of a nightmare because only 2 parties did it. They don't want to be together. We all know the details. Well, you know, the details I know, because they told me we need a decision because these people cannot build out further. On what they do without it also. In good faith, I'd really like to work with you on something that would both apply to the city and the county. So I think we can maybe mend some fences there. Okay, thanks.

All right, thank you, Leslie. Moving on from public comment, it's our consent calendar. The consent calendar contains items considered routine and or which have been individually scrutinized by the city council members and are anticipated to require no further deliberation. If a member of the public wishes to address an item on the consent calendar, please enter your name in the electronic kiosk located in the lobby before the consent calendar is considered. It shall be the prerogative of any council member before the consent calendar is acted upon to one, comment on an item, two, respond to any public comment on an item, three, request the record reflect an abstention or nay vote on an item, or four, remove an item and place it on the regular portion of the agenda for delivery of a staff report and or an extended discussion or deliberation. Council Member Reznor, I do see you.

Item 4.1A and 4.1B, I would like to pull and put on the regular agenda so I could ask some clarifying questions. For the public's knowledge, both of those items are relating to Stillwater Business Park, where those funds go, and accepting of aid. So if we could pull those, you can put them wherever you want to, because you're in charge here.

So those will become 9.1A and 9.1B? Correct. Okay, and Councillor Odette, I thought I saw you on there.

Yeah, so I have a question on 4B, and I'd like to pull 4.6B and 4.15A and B.

Holy cow. 4.6B, and what were your other items that you would like to pull?

415A and 415B. All right. And then I just have a question on 4B.

All right, let's ask your question, so.

Thank you.

Did you have your question or did you wanna ask?

Yeah, who's, is it you? Okay. I just had a question. There's a couple of items for the airport and then for Stillwater. So just for clarification, is the Stillwater funds from sale of property in 103? Is that the 103 Capital Project General Fund?

That is my understanding, Council Member Audet, yes.

Okay. And then for the airport, 201, is that accurate that it's negative $2.3 million currently for airports?

I believe that is tied to the passenger freight charge, if I recall correctly, and that they've leveraged future passenger freight charge anticipated revenues. And one of the staff reports that we've brought here, as well as in the future, talk about issuing a loan, an internal loan from potential.

I pulled it. That's why I just want to make clarity.

Perfect. So those are tied so that that can be remedied and we can provide the loan and clean up the balance sheet, for lack of a better term.

So does this, okay, so this proof of cash is for June, end of June. So this doesn't reflect any decision yet we make?

That's correct.

Okay, okay. Okay, that's my only question about that.

Thank you.

Yeah, thanks.

Okay, if you're keeping score at home, we have five items pulled, so we'll bring those back till later time during the meeting. We do not have any other public comments, so we will need a motion and a second. Motion to approve.

I'll second.

All right, all in favor?

Aye. Aye.

That's winning, 5-0, all right. So let's move on to public hearings. This is always really fun. A court challenge to take action by the city council on any project or decision may be limited to only those issued, raised during the public hearing, or in written correspondence delivered to the city council during or prior to the public hearing. We're on item 6.1. It's a public hearing to consider local public employees' vacant positions, AB 2561. And this is going to be a presentation by Leslie, is that right? Oh. We'll use you as backup, Leslie, so. Okay, be ready, Leslie.

Good evening, Mayor and members of the City Council. My name is Leslie Salee. I'm a personnel manager for the personnel department, and Director Kibler could not be here with us today. So tonight, I'm gonna be presenting the city's annual update on vacancies, recruitment, and retention in accordance to Assembly Bill 2561. Assembly Bill 2561 is essentially a transparency requirement. It requires us to annually report on vacancies, recruitment and retention, and to discuss the challenges those vacancies may create for delivering public services and the steps that the agency is taking to address them. So tonight, I'm going to be providing a high level overview for the city, including where our vacancies are, our recruitment activity, and some of the challenges we're experiencing in our retention information. So the city's workforce provides a wide range of essential services to our community, including public safety, electricity, water, wastewater services, parks and recreation, building permits, housing assistance, and community development. The employees filling these positions are critical to maintaining those services. At budget adoption, the city had 956 budgeted full-time positions. And then as of the end of this fiscal year, or the fiscal year 25-26, the city had 93 vacancies, representing a 9.8% vacancy rate, and then the average vacancy rate during the fiscal year was approximately 7.6, or 5-6%. So this slide here provides the month-to-month picture of vacancies throughout the fiscal year. The vacancies fluctuated during the year based on positions being created and filled, and also changes to the city's authorized staffing levels. By June 30th, the city had 93 remaining vacancies, and the final number budgeted full-time positions at the end of the fiscal year was 948. This slide here breaks the vacancies down by the bargaining unit. The vacancy rates range from 0% to 18%, and these numbers just provide a snapshot of where the vacancies existed as of the end of the fiscal year, which was June 30, 2026. This will give you an overview of our recruitment process. So one thing to note is that a vacant position does not necessarily mean that the city is actively recruiting for the position. But when a vacancy is identified and the department feels they have a need to To backfill that position, the recruitment process begins with the requisition and the necessary approvals. Depending on the position and circumstances, the city may use existing eligibility lists, internal recruitments, external recruitments, or a combination of approaches. And the process then moves through the posting, screening, exams, or interviews, and ultimately placement. So this is just providing you some recruitment information for fiscal year 2526. The city filled 132 vacancies. The time required to fill the positions vary depending on the recruitment method. Internal recruitment averaged approximately 67 calendar days. Newer internal recruitments averaged about 126 days. And then positions filled from an existing eligible List or ongoing recruitment average 223 days and that's also including continuous recruitment. So those are recruitments that are harder to fill that are just open until we can fill the vacancies. Some hiring issues that personal has identified with recruitment and hiring of these. include several vacancies just within the personnel department itself, an increase in workload, rising benefit costs, limited resources for succession planning and resource development, and increased time to fill. And so our focus has been on improving processes, increasing cross-functional knowledge, and prioritizing personnel resources toward the areas with the greatest operational impact. And there's also the financial context to the city's vacancy numbers. So the city initially implemented a soft general fund hiring freeze in January of 2025. And then in January of 2026, the freeze was expanded citywide. Departments are now required to demonstrate the operational need and fiscal impact of filling a vacant position before recruitment can proceed. The last slide shows some information about our retention. So the city had a total of 172 vacancies created during the fiscal year, 25-26. A significant portion of the vacancies resulted from employees moving within the organization. So about 44% resulted in promotions or internal transfers. And we also had 38 retirements and 51 voluntary separations. the annual turnover is about 18.10%. So that concludes the update, and I'm available for any questions that council may have.

We do have one speaker. Maybe I'll go to the speaker first, and then we'll see if you're available for questions after that. So I do see RIEO is available. And I forgot the best part. We get to open up a public hearing so you can speak. And there you go.

Good evening honorable mayor in the city council my name is Brendan car I'm a management analyst for the public works engineering division I'm here tonight on behalf of the reading independent employees organization board. The reading independent employees organization is the recognized employee organization for two of the city's thirteen bargaining units. The clerical technical and professional unit and the supervisory and confidential unit. Together, those units account for 288 of the city's 948 budgeted full-time equivalent positions, a little over 30% of our personnel total. Our members are the engineers, plant operators, accountants, record technicians, inspectors, analysts, housing specialists, and administrative professionals who deliver or directly support nearly every service the city provides. We would ask the council to consider that the financial constraints behind the decision to hold positions vacant are not uniform across the positions they affect. Many of our 37 vacancies sit in water treatment, wastewater treatment, solid waste, the electric utility, capital project delivery, and housing and community development. These are operations generally supported by rate payer capital or grant revenue rather than the general fund. Assembly Bill 2561 was enacted to bring recruitment and retention challenges into public view and to give this body a clear account of workforce conditions before it adopts a budget. The report before you states a citywide vacancy rate of 9.8%. The RIEO's two units stand at 12.9%. So in that spirit, RIEO asks the city to describe specifically what recruitment and retention efforts it is undertaking with respect to our classifications. Thank you.

All right, I don't see any other speakers, so we're going to close this public hearing. And is there any questions for Leslie at this time? Council, I don't see any questions. Is there any action you'd like to take? We're in discussion.

Can I ask a question? I'm unsure who specifically would answer it. Is that public comment considered an official request that falls into any sort of bargaining that we need to give them some sort of written or specific response? I just don't know specifically what the bargaining rules are surrounding that. So I want to make sure you don't step on the law.

I'm going to defer to... If I may, Council Member Reznor, I think that's a good question for your Labor Council, and I'm certainly happy to pass that along to them, and we'll get the response back to the Council.

Okay, thank you very much. With that being said, I'll accept the report.

Second. All right. We have a motion. We have a second. There's no further discussion. All in favor? Aye. All right.

Thank you. It's approved.

Okay, moving on to 9.1c. I have a feeling we have a lot of people here for that one today. I know we're eager for the information ourselves to get to discuss it. Our oral presentation from Circle 6 Consulting. Did I skip one? Am I out of order?

You can do it in whatever order you want.

We'll save it to the end if that's okay.

All right.

So thank you, Honorable Mayor. This evening we have Mr. Nathan Sprague from Circle 6 with us who will be providing a presentation. As Council is aware, at the meeting on September 1st, I presented a detailed presentation regarding the initial phases of the engagement and the quick wins that were ran to ground. And given the importance of the balance of the study, we felt like it was appropriate that Mr. Sprague was here to touch on the rest. And with that, I am pleased to introduce Mr. Nathan Sprague and hand it over to him. So thank you and welcome, Nathan.

Is it possible to leave those lights on? My eyes have deteriorated to the point that I can't see my note. Thank you so much. Thank you, Mr. Webb, Mayor Lataw, members of the council, city staff, members of the Redding community. Good evening. I appreciate the opportunity to be here tonight to speak to you in person. So over the last several months, our team has worked closely with leaders and employees across the city. And I want to begin by thanking them for their candor, responsiveness, and willing to engage openly, even when the issues were difficult. We didn't find any resistance. We felt like people were always forthright. We received all that we asked for and more. So thank you for that. You know, the quick wins identified in phase two were they were important and they created some real bankable value. But tonight is primarily about what comes next. So these larger structural opportunities that can strengthen the city's financial position, improve how the work gets done and support long term growth. So my goal this evening is to walk you through that portfolio. I'll explain how we believe the work should be prioritized and sequenced and describe the governance needed to move these opportunities from recommendations that just appear on a slide into measurable, sustainable results. So this is just a reminder. You saw this, I think, at the last council meeting when Mr. Webb presented. But we went through four phases. The first phase was really all about understanding where time and money and effort were being lost. So it was a rapid assessment. And if memory serves, I think it was 300 or 400 documents reviewed, just 74 interviews, I believe. So it was a deep dive into some of these things. And then phase two was really about how can we implement some of the quick wins, and a quick win being something that's relatively simple to do that doesn't require a lot of layers of approval, that really hits the mark in terms of In this case, it was how can we capture money that may be available to us as a city and digging through those things and implementing those things quickly. And the city's Mr. Webb and his team did a great job with diving into those things and capturing a lot of that value. And I think those efforts are still ongoing. Tonight, we're talking about phase 3 and phase 4, so the opportunity development. So developing that prioritize roadmap for the larger improvements, the structural changes. That are necessary for long term viability and sustainability financially and then the execution and government's piece as I said. So the tagline here, there's nothing in this report that recommends across the board layoffs, nor would we do that. It's maybe a strong word, but I think it's irresponsible when organizations say, you know what, we're going to cut 15%, we're going to cut 20%. And I can tell you the evidence that we had before us over the last several months and what we see in parallel with other government organizations and even private organizations is that when you get this swelling of staff, in this case, from 2007, 2008, that fiscal year, 23, 24, Redding's population increased by about 2.5%. The full-time, excuse me, the budgeted full-time positions increased by about 12.7%, okay? But that comparison by itself, doesn't really tell us where the city is overstaffed. It does tell us that staffing capacity has grown substantially, substantially faster than population has over that same period of time. But it reinforces the need to evaluate where those positions were added, what services and workload drove that growth, and whether the current structure is aligned with today's priorities. In parallel with this effort, what's going on right now is we're going through a reorganization effort. We're working with the city. We're coming up with recommendations. Primarily right now, we're looking at the management and administrative positions. And before we get to frontline staff, that's where organizations, and there's evidence that Redding has done this over the years, they tend to throw bodies at poor processes. So when you have an inefficient process, when you're embedded within it, it feels like we have too much to do. We need more people. We couldn't possibly do without these people. It's because they're operating in an inefficient process. So the right sequence of events here is what you see on the screen. The last step really is to understand what are those underlying processes? Where is the waste? Improve those processes, drive out the waste, make them lean, and then you can actually right-size the workforce according to those new processes. So just a reminder here, again, we identified some immediate practical actions that freed up some dollars in capacity, right? And you see the list there. But again, the larger opportunity is really structural. And here's the laundry list. So aligning services and workload and staffing models, roles and organizational design around priority services, core services, rationalizing underused land and buildings and facilities and understanding the costs associated with those. reducing the cost of long-term obligations, advancing growth opportunities that can expand tax and utility revenues. So the big takeaway here is that there was some real near-term value to capture, but the most material impact, again, is going to come from disciplined choices about what the city does, owns, funds, and prioritizes. And I should mention here that one thing we saw in a number of areas was that the city's financial guardrails had loosened over time, in our estimation. And they weren't always being applied consistently across the organization. And we can't tie that to any one person or any one decision. It built up gradually through policies, habits, workarounds, and that happened over a number of years. So really the opportunity now is to tighten those guardrails. We need to improve visibility and bring more transparency and consistency to how those financial decisions are made. So that's a pervasive theme that you'll see in a lot of the business cases that we'll show you, is that there were little to no or poor financial guidelines in place, and that's why we had some of the situations that we had. So, Again, those bankable savings in phase two were important. They created that immediate value. But really, we're here to focus on these more significant structural changes. And you'll see a portfolio of 52 of them. I think I have 15 or 20 minutes to speak to you. I certainly won't drain all 52 of those. And these slides are excerpts from the full deck that I believe was published on the 10th. So there's really two sides of this equation. And you probably heard Dr. Danuka mention this a couple times now, I have in the media. But Reading can't simply cut its way to long-term financial strength. There's two sides to this equation. It also has to supercharge the growth engine. You have to bring in new investment, expand the tax base, perhaps increase utility and other revenues, and make better use of the assets that the city already owns. So the long-term answer has to include both, both sides of the equation. Yes, we have to understand where we have unnecessary expenses, but we also have to look at the other side and fuel growth. So again, The next several slides give you a little paragraph about each of these potential long and medium term opportunities that exist for the city structurally. I'm not gonna go over all of these. I'll hit a few of these. And then what follows in the next few pages are a few business cases that we developed where we had a little more information in front of us and were comfortable making some projections in terms of the benefits and what it might take to get it done. So just a couple through here. I'll take a couple from public safety. Evaluate demand-based staffing models that better align resource deployment with seasonal and peak service needs. Evaluate alternative service delivery and governance models within public safety, including potential fire district structures to improve efficiency and long-term sustainability. Evaluate overtime drivers and staffing configurations across public safety to ensure alignment with service demand and cost discipline. Going over to development, evaluate development services fee frameworks, cost management to enhance cost recovery and generate potential general fund relief. So there's a potential about $1 million there. That's one that we did do a business case on. Going down to IT and technology, review IT department coordination models to support improved alignment and service effectiveness. And you can see how these are kind of separated out. There's several in administrator support, several in organizational alignment, facility strategy, fleet standardization, fiscal ISCUs. I'll hit a couple more of these. Over in admin, evaluating compensation structures, including the recent minimum salary adjustments to ensure alignment with market conditions, internal equity, and fiscal sustainability. Evaluate position control governance, including potential centralization to strengthen workforce planning, accuracy, fiscal oversight. Going over to organizational alignment, evaluate grant management structure, including opportunities for centralization to improve coordination and funding outcomes. You know, it was interesting just anecdotally, we found several instances where because grants are not centralized in terms of their control and submission, Very often you'll get a grant and let's say for argument's sake, you get a new piece of land out of it, you get a new park, which is wonderful. It's great for the community. Very often what happens on the back end is we don't have the dollars or the resources to maintain that park, right? So we're suggesting there that we take a look at perhaps centralizing that effort so that we can squash some of those kinds of things before they cause more issues financially. FACILITY STRATEGY, EVALUATE FINANCIAL REFORM'S NON-CORE FACILITIES ON A FACILITY-BY-FACILITY BASIS TO INFORM LONG-TERM PORTFOLIO DECISIONS. OKAY, SO WE DO HAVE A BUSINESS CASE FOR THAT AS WELL. IT'S TAKING A P&L LOOK AT ALL THE ASSETS THE CITY OWNS. EVALUATE BUSINESS PARTNER DEVELOPMENT PATHWAYS, INCLUDING DATA CENTER OPPORTUNITIES, ENERGY USES TO MAXIMIZE LONG-TERM VALUE, REVENUE POTENTIAL. Evaluating and help organize, or excuse me, operationalize a citywide facility maintenance strategy to enhance asset performance, lifecycle management, and cost control. So you get the idea. And again, there's a portfolio of 52 different opportunities here, and we're not suggesting that the city do all of these. These were things that we found across these different broader sections of the city that were good opportunities to kind of turn the ship around. And the thing that's not so obvious as you go through these is many of these are connected. So when we talk about prioritization, we talk about sequencing, it's going to become necessary to understand which of these efforts must necessarily involve other efforts, right, on the pages as well, because many of them are interconnected. Let's see, last page of those. Evaluate park system utilization, planned expansions, long-term maintenance obligations to ensure the portfolio remains aligned with service priorities and is fiscally sustainable. So again, I'll reiterate, I think now for the fourth time, the largest and most durable value for the city is embedded within these more complex medium and long-term structural opportunities. You know, not what we did in phase two where it's quick wins and we're kind of gathering the cash that we can and bringing it back in or sending it back to departments. All right, so what we did, as I said, is we went through that list of 52 and we looked at it through a couple of different lenses. One was, what are the high value opportunities? What are the things that could be done Perhaps some of these are more long-term, but in terms of everything but revenue generation, in the medium term, right? These are more complex project-based opportunities that's going to require a team. It's going to require a project manager, right? And it's going to require some time. And we took a few of those and we said, where do we also have some information where we can make reasonable assumptions about what the impact might be, right? The benefit of doing some of these projects. So that's what you'll see in the next few slides. And again, I'm not going to go through in great detail on each one of them. This one you saw last time. I'm going to skip that one. Mr. Webb addressed that. This is another one, the transient occupancy tax. So there could be up to a million and a half dollars roughly in opportunity annually there. From what we could discern with the data that we gathered, it's a very loose process that needs tightening up. I think we have some processes there that may be personality-driven rather than process-driven, meaning that if we take a few key people out of that process, things may fall through the cracks. So it's an area that needs to be improved. It's an area that needs to be tightened up, and then those things institutionalized. This one, I think there's a tremendous opportunity here, and this is going to take quite an effort. But really what we're talking about here is building a facility by facility, parcel by parcel P&L for non-core assets. So looking at things like revenue and direct expense and utilities and maintenance, internal charges, debt lease constraints, utilization, the capital that's required over the life cycle of that particular asset, and then making some decisions, right? City leadership and the council making decisions about dispensation for some of those things. So you can imagine a city like Reading and many like it, you tend to collect these things over time and very seldom do you divest yourselves of them. You add and add and add, which does what to the expense side, right? There could be great benefit to the community, but you also have to reconcile that with the expense. So looking at it in terms of utilization and looking at it in terms of profit and loss, if you want to look at it that way, in order to help us get that balanced budget and bring in some more revenue. This one I mentioned before on the other page, but This involves going through a study. Currently, I think this group is subsidized by about, I think it's a little over a million dollars. There's about $300,000, we think, in the overall expense that's probably not recoverable, but there could be a million dollars there. But it requires an industrial engineering kind of approach where you're identifying every element of the work that's required in order to issue a permit and then charging appropriately for that based on actual cost, right? There's another one with the fire department, the tagline here, the bottom line up front, overtime $4.7 million versus 2.2 budgeted. So there are a number of things that we're recommending in the lower left that can be done in the near term to capture a little over a million dollars there. I don't think there's anything in there that's all that wild or controversial. Uh, credit card fees, so the, the city currently process is about 174Million dollars in credit and debit card transactions. And they incur about 1.5Million in annual processing costs and already use the overwhelming majority of those payments. That's the largest concentration. But the other thing we discovered when looking in that to a bit to develop a business case, if there are multiple processors, multiple platforms, so there's an opportunity for consolidation there as well. The bottom line here is that you may be able to reduce processing expense, And stop broadly subsidizing, you know, an optional payment method. Right. But it has to be implemented as a transparent cost recovery, not as a new source of discretionary revenue. Right. In other words, the revenue that you take in, we all we're all accustomed to paying those fees. Right. You go into a business and they say, well, if you pay cash, I'm not going to charge you that three percent or whatever it is. Right. So this is. It's the same thing. That business is trying to recover those processing fees from the credit card companies. But what we have to do in California is we have to give you the ability to pay without the fee, check, cash, in person, and things like that. Also, some CalCard stuff here. So the interesting thing there was... It's a pretty large and fragmented group of vendors when you start looking into the data. But there's also a lot of incomplete transaction documentation. We had 3,400 transactions without a stated purpose, more than 3,200 without a description, and about $5.5 million categorized as miscellaneous. So that needs to be looked at. Those rules need to be tightened. and we can't allow ourselves to have a catch-all bucket, right? Because there's no transparency in that. We don't know what we spend it on. Okay. So this one, an enhanced infrastructure financing district. So it would allow the city to dedicate a portion of future property tax, increment generated within the Oasis Road area and allow it to build infrastructure like roads, utilities, drainage, broadband, other improvements like that. So it's not a new tax and it doesn't rely on any immediate general fund contribution. So the strategic value is that you can really build this backbone infrastructure to unlock private development around the Oasis Road and I-5 corridor. So, interestingly, that could position that area for commercial, industrial, logistics, technology investment without expanding the long-term tax base. So, we think that's worthwhile to look into. The fiber backbone. Clearly, Redding controls some valuable infrastructure through REU. The poles and utility corridors and private fiber developers are already seeking access. At the same time, California's middle mile network may create important interconnection opportunities in or near the city. And the risk is that we address each request as a separate hermit or agreement. I think that's where we fail. That could lead you to, as a city, you could underprice access, you could accept inconsistent terms when you're doing that piecemeal like that, create fragmented infrastructure, or give away capacity. It might be needed for the future, for municipal utility, public safety, or economic development purposes. So the recommendation here for this project is develop one coordinated fiber and digital infrastructure strategy. So that includes undertaking inventory of all the poles, the conduit, all the existing fiber, rights of way, interconnection sites, establishing consistent access and pricing policies and reserving municipal capacity, and evaluating public, private, or open access opportunities. I can hear the groans before I start talking about this one. Believe me, I'm not gonna stand here and wave pom poms in the air for a data center, but there is a business case for it. But clearly the business case for a data center has to be reconciled with the will of the community, right? So of course we have to list that as an opportunity, but we're certainly not suggesting that you put all your eggs in that basket. We know that's politically charged to say the least. Right, so next, and I realize I'm going a little bit over time here, so I'll speed up these last few and come to a conclusion. But I'll just stop on this slide. There's a lot more detail, obviously, in the report that was released on the 10th, and you can dive into that should you like. But really, the logic here is simple. The roadmap here was to capture dollars first. Stop the recurring leakage, redesign the work, align the organization, and build the growth and performance platform needed to manage the city in real time. That's what we think the order of operations should be here. Recover dollars, stop leakage, redesign the work, align the organization, then build the platform. So you can see through this, we're not saying, why don't you go ahead and launch these really hard structural moves first? We don't suggest doing that before you have the credible data, the fund treatment, the position control, service demand visibility, and this city manager-led governance cadence, which is in the next section here.

Okay.

I'm going to skip through a couple of these, as I said, because we're a little bit behind. I'll just stop here. There's some more detail in the next few slides that I'll go through later. rapid fire, but this section was really all about execution and governance. How can we create a system so that these opportunities don't just stay in a deck somewhere, right? We have to go from the consultant slide deck into actual execution. And we have to maintain control of that. We have to understand, are things on track? Are things off track? Who's responsible? what needs to be done next, right? So you can imagine all the infrastructure that has to be set up in order to keep track of all this, sequence things appropriately, right? For the best long-term benefit for the city. So that's what this section was all about. We have some artifacts that we've left behind and you see some screenshots of some of those here. It's anchored by a city manager led execution review. This is all done in Excel by design because it can be done immediately, it already exists. There's a guide that goes along with that. And you see a little bit of detail here for each of those three sections. There's a dashboard. That dashboard, at a glance, can give city leadership a view of the financial impact, what risks exists to execution, sustainment, which is a really critical part of all this. The last thing that the city needs is to solve these problems, only to have them have to play whack-a-mole later as they pop back up again and again. So the control phase of these projects becomes absolutely critical so that you can sustain the gains that people, you know, you spend all the blood, sweat, and tears fixing these processes and getting them lean and getting them efficient only to have them unravel. So that part's really critical. Also understanding where's their backlog, if any. So the line here says it gives them a practical education infrastructure, execution infrastructure without waiting for technology enablement. Here's what I mean by that. I'll stop on this slide. So what we're suggesting now is use this execution and governance model in Excel. Our view for the future, when I say future, this would be I would guess three or four years down the road, is that city leadership and perhaps even the public would have a dashboard for all the KPIs, the key process indicators, the things that make the city tick, the things that instantly allow you to know whether or not the city is healthy financially and otherwise, right? And so city leadership, the vision there would be they'd have a dashboard, they'd have alerts that they could set up, Hey, alert me when this value goes below 10%. Boom, they have an alert on their dashboard when they log in in the morning. and then having the ability to drill down all the way down to the process level so they can understand how these metrics are connected and cascade with one another. But imagine all the systems and all the data and the infrastructure that has to be set up before you get to that point. It's a difficult task, but we've helped several organizations do this with one of our partner technology companies, and it's amazing when it happens. But it's all about getting it to understand how the systems communicate with one another. What are all the systems? How can we extract the data into a data lake that we can then mine? A lot of these systems also have the ability to ask natural language questions. So if you just want to know what would happen if I do A, B, and C and this metric moved to here? Well, because AI is so pervasive now, this thing's running in the background, it goes to the data lake and it runs a model quickly, right? A lot quicker than any of us could. And it gives you the answer. And then if that's something that you'd like to keep tabs on and have it keep charting this for you, you can say, hey, add that as a widget to my dashboard. So that's kind of the vision. But in order to get there, we have to start somewhere. And so the crawling part of this is using Excel for now. So before I close, I would like to make a practical offer. You know, there's a lot in this roadmap, you know, and the city has limited capacity to take all this on, especially at once. You know, we do have senior consultants who already understand a lot of the issues that we've discussed. They have experience taking opportunities like these from recommendations through execution and sustainment. If city leadership believes outside support would be helpful, we'd be glad to submit focused proposals on a project-by-project basis, not an open-ended engagement. Each of those proposals would clearly lay out the following, the scope, the timeline, the consulting costs, the estimated savings or revenue opportunity, the key assumptions that we're making, and a clear return on investment decision point. Something like that would allow the city to evaluate each of these opportunities on its own merit, move forward only where the business case is strong, and maintain control over the priorities, the pace, and the level of investment. So the objective really would be to help the city capture value more quickly. build the necessary tools and controls, and then ultimately transfer ownership back to the city staff. And whether the city chooses to use our team or another approach, the important thing here is that I want to reiterate, these opportunities, they must move from analysis into disciplined execution. So we'd welcome the opportunity to continue partnering where it makes sense. Thank you for your time.

All right, thank you. We do have some speakers, so maybe I'll go to the speakers first, and then we'll come back for comment or conversation here. There's six speakers I see here. We'll start with Kathy Grissom, Susan Weiss, if I pronounced that right. Okay, sorry, Lauren Otten, Victoria Peterson, Robert Sid, Leslie, if you guys could help us with time and just make your way up to the wall so that way we can go speaker by speaker and move along, but we'll start with Kathy.

Hi, I'm one of the originators of the petition that's circulating right now in Shasta County, gathering signatures from people who support a ban on all data centers. We've only been gathering signatures about four weeks, and with a lot of help from a lot of people, we received overwhelming support. We've got over 1,500 signatures now and are getting more every day. I know that data centers are not on the agenda tonight, but like many other people, well, we started the petition before this report came out because I knew this was going to happen. But then a lot of people noticed that page in the report, and it just seems like you're laying the groundwork for this to happen. You're doing more infrastructure at Stillwater. A lot of the things he said are things that are needed for data centers. That's what they do. They lay the groundwork before people even know. And I just feel like, seems like that's happening. I don't know, I hope not. I don't think viewing our open space as, oh, that's a great place for a data center. I think that's obscene. That's not what our open space is for. It's why we live here. It's for our wildlife. It's for our ecosystem. It's for our recreation, our agriculture, our tourism. It should not be for sale, especially our water. I don't know where you guys stand on this, but I'm here to let you know that if you support this recommendation and don't, put some kind of ban in place, we'll fight every step of the way. Besides the destruction of our environment, you can see, finally, even on our local channels, how terrifyingly dangerous AI is. I can't imagine any reason to help facilitate its existence. States and counties and cities all over the United States are implementing bans or very restrictive moratoriums, and I encourage you to do the same. This is our introduction to you, but we'll be approaching you soon to try to get a ban on the agenda, and everybody should really educate themselves like we have on the dangers and decide what you're gonna do. Thank you.

Kathy, would you please leave your petition with the clerk and we can take a copy of it? If you can give us a copy of your petition so we can read it as well.

Okay, a lot of them are still online and not printed out.

All right, thank you.

How can, would I do it now or when you get it on the agenda?

Sure, you can bring it forward right now if you like and bring us more later. Anytime, or you can email us anytime.

Who would we bring it to?

Yeah, right up here. Okay.

Well, it won't be now. Anything could be emailed to the clerk's office. You can email it to us. Or to any of the members of city council on the city website. You can click select all and email something to all of us if you want to. But it does go through the clerk's office.

So you're saying that you want a copy of all the signatures?

No, the petition itself.

Just the petition? Yes. I can give you that right now.

Yeah. That's all? Thank you.

Thank you, Kathy.

Thank you.

All right, Susan?

I'm Susan Weiss. I'm a resident of Reading. And I'd like to thank you, Mayor Letao, is that correct? I'm Weiss, you're Letao, for your statement online about data centers. I'm sure you've all been following the recent outpouring of debate about data. Data centers online, every other thing on Facebook is about this very problem and people are having problems all over every city, every county, every state in the nation. People are rising up and saying, no, we're not interested. I know I'm sure you know this already, but Gilroy started a data center. And they started building it, and the public all of a sudden decided to get upset about it because they felt they weren't informed. In reality, the city put out all the things they had done to try to educate the public, and in my opinion, it was quite a bit. But the public is slow to bring along, slow to be educated, and they are up in arms now because now they're talking about— Gilroy City Council today or yesterday put a moratorium on any other data centers coming in to Gilroy. They're going to study it in 45 days to make a decision. Now, I know you all know that we don't have the staff or the ability to study anything in 45 days. It would have to do with data center. That's just not even realistic. 45 days. The Mercury News says they will study water usage, electric grid capacity, noise levels, zoning rules. And they will study the consequences of allowing another data center in 45 days. We don't even have the staff to pull off what we're pulling off right now in this. Listen to what we listen to today. We don't have the staff to pull it off. We don't have the professionals. We don't have the engineers. We don't have the people to come up with a study as to whether they're good or not. So a moratorium of 45 days or a year, a year and a half isn't going to make a bit of difference. We are a real target for these centers because we don't have a lot of money and we're rural. And it'd be really easy to say that that's our solution. But trust me, our property values, our health risks, our quality of life, our environmental effects on the flora and fauna of our area, nothing's worth it. No amount of money is worth all that. No amount of money. And I think you would agree with me. So I would encourage you just say, I don't know how much time you would need to study a data center. It takes 10 years to know the real effects of what it's doing to our health and what it's doing to an area. So I would suggest you say no to data centers, at least for right now. That's not the way, I'd rather do cupcake sales, quite frankly.

All right. Thank you, Lauren. I'll buy your cupcakes. Make sure those cupcakes are really expensive because we need this. We could use that cash. All right, Victoria, is that right? I like cupcakes.

Hello, honorable mayor and council members. I'm really pleased to be able to be here and be able to say something. I'm not going to say everything that I had planned because the two people before me about covered it. Just would like to say that there seems to be this feeling somewhere that, oh, we have to keep going with the data centers, AI. We can't let China beat us. Well, China has 513 data centers and four times the population of the United States. The United States has 5,427 data centers in a quarter of their population. So I think they already beat us, and we should get smart and try to find out what they did that was so good. And I just want to underline the concern for the environment and our health. They're still finding out. All the health disasters that come from the toxins that are released, and I won't go into it. It's all online. The light pollution, that's just crazy. And the promise of jobs. People come in to build these centers because an average electrician doesn't know how to handle this stuff. And then they leave. And there will be very few jobs left, like 50 to 100. Anyway, I request that the city of Redding take a position, and my position would be to just flat out ban the building of data centers. Thank you.

Thank you, Victoria. I don't know if I have your name checked in, so did you fill out a card in the back by any chance?

Lauren Otten.

Lauren.

Wasn't there next?

Lauren, I'm sorry.

It's his birthday. No, it's not. Good evening, Honorable Mayor and City Council Members and City of Reading. This is a really big topic. Politics really are not my thing, so if I don't do this perfectly, forgive me. I'd rather be home gardening. I'm standing here today as a, I suppose, serial entrepreneur and very concerned citizen whose family has been in this area for a few generations. Thank you for your presentation. It does take a lot of capacity to put that data down and so I was listening to your details and it would be interesting to compare notes with you later. However, the holes that I'm seeing in this argument are Quite a few, so I'll try to make it as concise as possible. If we're talking about the money piece, that's what we're trained to look at, right? As a serial entrepreneur, I cannot just look at the money piece, I look at the whole picture. And when you look at the whole picture, this is what I see. Our budgeting and funding issues, we are doing something on old thinking, if you will. expand, expand, expand, develop, develop, develop. At some point, that does not sustain itself. At some point, you hit a wall. If you want to fix that, I really think that the city needs to give more Resources benefit to small businesses, small business owners, and more support for them. It is difficult here to run a business. People go under all the time. It's also life crushing for them to go through that experience. So mental health gets thrown out. Not to mention, let's talk about mental health with AI. AI has been proven to cause many mental health issues. People don't want their creativity and productivity stripped away. No human being wants that. I think we all want to feel productive and like a part of a community. Um, also, uh, in terms of development in the way that it is being done, I'm concerned. Um, I've seen several development projects. Um. 1 of the ones on your agenda, I think was exempt. That concerns me because making uninformed decision leads to repercussions. And let me share a huge repercussion that we're going through in the state of California right now. I'm going to bring up butterflies. The monarch butterfly is down in its population numbers by 95%. How many people knew that in this audience? Wow. OK, we got about five hands. Who doesn't like the monarch butterfly?

Lauren, I hate to cut you off.

That's fine. I'm just going to say this really, really fast. If you're making uninformed decisions about development, then you can't know that you're causing these repercussions.

Thank you, Lauren. Thank you.

But I'd love further conversation with anyone who's open.

Thank you, Lauren.

Thank you very much.

You've intrigued me on the butterflies, so I want to hear more about that later. Thank you. Yes, thank you. Okay, Robert.

I agree to pass a resolution to prohibit the proliferation of data centers and slam the door to any future recommendation. Regardless of what circle 6 says, it is that disastrous idea for reading and accounting as a whole. Based anthropic says the most powerful models are showing they can and will escape human control. The company is calling for a global freeze on development to give society time to catch up and make sure the right safeguards are in place. Data centers pose several significant problems, including high energy consumption and water usage, water we don't have, which strain local resources and lend to increased utility costs for residents. Additionally, data centers contribute to pollution and health risks due to emissions from backup generators and large amounts of energy required, often sourced from fossil fuels. Did you know two data centers are coming to Trinity County? It is never one data center, they proliferate. Now I'm from Santa Clara County, mean streets of East Los Gatos, and have worked around data centers. They are loud, water guzzling, sterile power sucking eyesores which employ only a skeleton staff and do not significantly benefit the community. The consultant is recommending that we invest in snake oil and charging us a fortune in consultancy fees, which we can ill afford. Many bipartisan coalitions have been formed because it's not a left or right issue. Liberals and people on the left are concerned for environmental reasons and distrust in AI companies. And many conservatives, myself included, are upset about data centers too. I would ask my fellow constituents to work together to help disarm and press the brakes locally on the runaway AI train. Council, please pass a resolution of commitment to ban data centers from Reading. Only Mayor Mike has come out with a statement. We must exercise our right as a community to stand against inviting economic disaster upon an already impoverished community. When the AI bubble bursts and people figure out the soulless and ghoulish monster created cannot do all the things the man in the pet store said it could, we'll see the effects of widespread unemployment. Many data centers are started and abandoned partway through because there is no real actual ROI. And do we really need more empty derelict buildings to be used for squatting and vagrancy? We've got plenty. I'm speaking to fellow Redding residents. AI is not our friend. It has no heart. It has no soul. It will soon act without human intervention, regardless of what is being sold. Do the research beyond the empty promises and media puff pieces and see the wreckage of lost jobs and the financial benefit to nobody apart from the privileged elite and the CEOs. Follow the money and pay attention to the man behind the curtain. Find the courage to pass a resolution. And if council member disagrees, then let that person be known to the public through their vote. Thank you.

Thank you, Robert. All right, Leslie. After Leslie, I think you're intending to speak. I don't see a card filled. Okay, it's on the computer or we can do this with the city clerk up here. But Leslie, go ahead.

Hi. Okay. Let's get the AI part out of the way and then I'll address the rest of what I was really excited about on that. The fact that you sensed that was gonna be contentious and you're not from around here, all sides of the aisle hate it and nobody agrees on anything in Shasta County. So if you thought the alternative custody program location was bad, bring an AI data center here. You'll see us unite, which would be great. I would actually, can you do that before November? because I have some elections I'd like to get through. So if you can unite us before November, that'd be great. But that being said, I hear our city manager position and our finance director pay more than the president. So do you want a job? Because based on this, I would hire you. Okay, so your actual presentation, let me get to that. I don't know if you caught me like, doing this over there, but you brought up that needs improvement. Maybe it's personality back. I said that that was like, my 1st ask of Mr turbo is we are mismanaging so much money here. I'm not kidding. Do you want a job? I might ask you that a few times service fee and cost recovery unlocks maybe a $1,000,000 in the permit issuing. That's part of what I want to talk to you about. Mr. I think we can make it easy to do business and reading and Shasta County and not destroy our businesses. In fact, I have a whole coalition working on it and we're going to do some really cool things. And I want to work with you guys on this, but it's going to save us money in the long term and make our lives better. But we need the people with the personalities to get out of the way. And we need people diving into these numbers. Thank you for diving into these numbers. Thank you again for uniting us and bringing up AI scary data centers. Okay. Because you filled this room in a way we couldn't when Tanesa was trying to bring up all of our budget issues. So thank you because I would like for all of you.

AI cut your mic.

AI cut my mic. That's fine. I'm loud. I still have 50 seconds.

So... That's good.

You're getting funny. The fiber backbone, I looked into that. The only real drawbacks are like construction and then what happens with the revenue after, right? So... It's projected what it's going to give us once we fix that deficit. Does that then go back into the pockets of the taxpayers by decreasing our utilities? Because we're providing this fiber network, right? Like, so does that money stay here? That's how other states do it. So if it does, I'm all in. Let's build a fiber backbone. It solves our issue. And then we get shorter, lower utility costs. So again, you want a job? I'm all in.

Thank you, Leslie. So, Melody.

Good evening, Mayor and Council. My brain feels like a snow globe right now, so forgive me if this is just kind of all over the place, but I was listening to the presentation. I know you're from Texas. Texas is a big data center hub, and I would love to see the presentation be like option one with a data center and option two without a data center and going forward from there. But Gosh, I've been trying to think of an analogy of data centers this whole time. And in doing the deep dive into all of it, I found out how ignorant I was of them. I knew they were big and scary, but I didn't realize how the people, the communities are the ones where it falls on us. When these data centers, which are in a bubble, and they don't want to, they don't want to hear bubble because we know the 2008 bubble was linked to banks and the system. Well, this is private investors. And so this is the analogy I came up with. So. And it's not perfect. I've only had this for 24 hours to come up and present. But it's basically like there's flyers everywhere. Oh, you need to come to this race. This race affects you. And people are selling, is it IPOs, to the community to buy into this. And so everyone shows up to the race. And there's all this money invested. And the people in the race You know, they're about to fire the gun and they're off, but they have no legs. Only a third of the data centers on paper are actually being built. Many of the data centers don't even know how they're gonna source their energy. Um, energy is in a huge crisis. Um, we are in a war with Iran right now, and I am there's a wonderful timeline. I'm willing to share with you of all of the oil refineries that have been. Accidentally or intentionally sabotaged. So we are moving towards something very dark and the control grid is real. And the flock cameras, I was just at a meeting trying to get that on the agenda down in Anderson before I came here. That is part of it. We know during COVID, we were told to stay home and those flock cameras would sure come in handy if there was another house arrest pandemic to track people to see where they were coming and going. The people that were blowing up this whole thing about the foot race, by the way, is OpenAI and Anthropic, who are presently... Sorry to cut you off, but... Oh, is that the three-minute?

Yeah, you were doing a good job.

Okay, but one last thing is that this one gentleman spoke, and I will share that with you if you would like to see it. He said, let's do a 10-year moratorium because this bubble will pop. These data centers, all this hype, we're going to be left with a lot of infrastructure and a lot of waste and a lot of sick people.

Melody, thank you. I really got to cut you off.

10-year moratorium. Do a 10-year bond.

Thank you, Melody.

Yeah.

All right. This is Jade is that correct?

Yeah hi there thank you so much for having us up. I don't have a lot of statistics even though there are oodles and oodles of them. I just came here with my heart and I feel like the unification of the people behind me. I'm not into politics I've never spoken at a City Council meeting before earlier at Anderson. And I think I just have a couple of points. One, if we need more funding, how about we defund Flock and reassess those resources back into the community? Because nobody wants it here. Flock and the data centers are one in the same. And what are they for? What do we need a data center for? What's it storing? And why? Massive invasions of our First Amendment privacies, massive constitutional violations. Look at the backlash, it's happened so many places. Why do we want to bring the curse of that upon us when we can see what it's done to every other city it's been in, to the minds and the hearts of the people? It's clear, the data is massive, so I don't even know why we're discussing destroying our city with something that catastrophic. I know Flock's been here since 2019, and most people have been fully unaware of it, but who are we paying? And who has access to this data? Literally anyone. It is currently up for auction. They have changed the living document of the contracts. So we know that we're not going to be told everything. We know that it's detrimental. It's being used to fund Diabolical sources, we are fully aware of the Epstein files and the Epstein class and the massive ring of sex trafficking that goes on in this country. I am an advocate for save our children and I'm here to speak for the kids. This stuff is being directly used by Israel to surveil us, being sold to multiple countries and being used with abuses of power. Flock and the data centers all funnel into the same billionaire class and it is benefiting none of us. And the people are screaming in your ears, So even with flock, it's going to get louder and louder and louder until you guys listen. And the sad thing is, is that we have to be here begging you to listen. If you're not listening to us, who are you listening to? I just want to say most of the proposals for the saving of money that he is providing are building an infrastructure that will make us very easy to be broken into, controlled, and surveilled. And then they're going to give it back to us? Yeah, right. We know they don't give things back to us. They contain that data forever and sell it to everyone. I say no on all of that infrastructure. I say no on data centers, and on behalf of children that are being trafficked in our country, no on flock.

Thank you. All right. Thank you, Jay. Thank you to all our speakers. Thank you. Let's get into some questions or comments. I see Vice Mayor DeNuca. I see you're up first. Thank you, Mayor.

I thank you to all the speakers who came out today to speak your mind and what is on the heart and mind of many, many people in our community. I just want to point out there was a Facebook post from me in June of 2023, that's three years before today, which said, real wisdom is much better than the artificial intelligence. And I still hold that truth. I, as Nathan mentioned, I have been a big advocate of growing our economy and next economic engine. I believe that is going to be based on things like basic needs like education, health care, and not on data centers. I would rather build a medical school, a school of health sciences, and school of multiple training opportunities and education in our community before I ever say yes to data center, especially I would rather build those infrastructure of basic needs that we all have for our people before saying anything to support any data center for tech billionaires. I assure you that. But now in defense of Nathan, I think that was just one of his thing, which because that is a question a lot of communities are asking that, hey, why not a data center? And being a physician, I always compare different medications, different options before saying yes to something or rejecting something. So I think Nathan, in his defense, I want you to understand that nobody's against you. It's just that this is a debate we have. So he's just presenting this idea, which I can tell you from my side, it's going to be in the bottom of the pits. We have many other things which we can do and think of. So I appreciate your being here. And I understand what you're saying. And I'm also deeply worried about our future based on this super intelligence, us trying to become like God, which we never will become.

Thank you.

Any other comments from Council? Discussion?

I just have one question.

Okay. That's Councillor Munns.

In one of the circles you said Population increased by 2 and a half and we hired like 12. 12%. So we were a little bit over the hiring over population. Did you identify where those spots were? I mean, is it possible that there was actually a workload that needed to hire those or.

It is absolutely it is absolutely and maybe I didn't do a good job of articulating that, but that doesn't necessarily point to the fact that the city is over staffed. Right? We have to understand where those were your full service city after all. So, you know, a deep dive at some point into a position by position. Analysis would inform that and clearly we didn't have the bandwidth or the time to do that as part of this study, given the depth and breadth of all the other activities.

Thank you, sir.

You're welcome.

Thanks for coming down.

You're welcome.

Counselor. Hi, Nathan.

So I obviously have a lot of questions, but I think some of my expectations were around efficiencies. And it sounds like a lot of the things that you're highlighting are more like identified failures or weaknesses in our financial controls. Would you maybe give us a few of the top ones that you think are affecting the budget? Or are we talking about if those financial controls come under control, is that a better capture for what our budget is doing? Is that just a transparency issue? Or is that something that will actually help us not spend as much or stop that from happening again to where we're spending and we don't know about it for months and months at a time?

The short answer is yes to all the above. And it wasn't that. we went in and discovered that, oh my gosh, it's the Wild West financially. This came to us in fits and drabs as we were diving into these individual processes and events that happened in the past and things like that. So my statement is more collective than in any one spot. Yes, I could come up with some anecdotes, but I don't really want to do that on the spot because I'd have to give it some thought in terms of which are the most impactful. But I think that being said, the thing that's really impactful is that it's rampant. I think it went on for years. As I said, I can't point to any 1 person or any 1 decision. It's multiple decisions, multiple workarounds. It's it's multiple times when there's a discrepancy in. And what you see on a spreadsheet versus what's in the notes from council, for example, it's allowing departments so much autonomy that we lose control fiscally of what's happening. So. I think through the course of going through a lot of these medium and long term opportunities and improving those processes, a necessary part of this will be to understand where the current financial guardrails that are in place related to this specific process and what process can we put in place to ensure that we don't get this out of control situation that we discovered over the last number of years.

So even if we had more money, if we don't actually fix our controls and our accountabilities, then it's not going to solve our problems.

I agree 100% with that statement.

So I know you don't want to point a finger, because my question is who's responsible, but maybe a better way to say that is who actually can fix it?

Well, I think that's up to city leadership. You know, what we've provided is a portfolio of opportunity, each of which, as I said, necessarily will have to have sustainment features built in. Right and part of that sustainment conversation always has to be, is there a financial process in place? So that we have visibility, transparency, and that we're good stewards. Of the tax dollars that were responsible for spending as a city.

Okay, thank you.

That's all your questions, yeah? Well, you said you had a lot, so. No, that's good. Councilor Reiser?

I reserve the right to come back with more questions now.

Okay, I'll work on it.

There you go, yeah.

First, I want to say thank you. Thank you for all of this. I would ditto what Council Member Roddatz said in terms of efficiency being my goal of what is not working and how can we do it better. The thing that was really upsetting after reviewing slides before was that, and it might have actually been something that you said, but that I had written down after it was presented originally in these slides to council. But this failure to adhere to financial discipline and a need for transparency, it is wild to me that we have 5.55 million under miscellaneous. That is shocking. Every business owner in here would probably just pass out at what that percentage is of things that would be categorized as miscellaneous. And I heard, I think today was the first time that I heard that potentially that Circle 6 could be a project manager. So my question is a little bit in your direction and a little bit at Mr. Webb's direction. Who at the City of Reading would manage making sure all of these efficiencies or levers or procedures are put in place and that we adhere to this if we Don't fire circle six.

I'm happy to offer my opinion on who that should be. It should be led by the city manager. And in fact, we were pretty explicit about that in our governance structure.

Our interim city manager is wearing about four hats at the moment. So that was why my question was, are we putting a fifth hat on you if that is the case?

Well, I can jump in here, Council Member Reznor. Certainly, as Mr. Sprague's ran through and the community heard in the comments, this is of utmost importance to us. And we definitely plan on spending time running through these things, working closely with Mr. Sprague and his team, and identifying when does it make sense to move forward with each of these opportunities that are in here. Some of them, again, as Mr. Sprague outlined, are going to take a little bit more time, a little bit more analysis. I'd like to think that we would focus our efforts on the one that have the biggest value at stake initially with the least amount of time. But quite certainly, I think that we need to look at our general fund budget first, which I plan on bringing the mid-cycle to this body the next meeting in October, first meeting in October, and getting that squared away, kind of peeling off of the quick wins that we discussed back on the 1st. And then I think after that point, it would be very prudent to start looking at what opportunities in here make sense to move forward with, working with Mr. Sprague and his team and even potentially other consultants, and then figuring out what position makes the most sense, both from a bandwidth and a capacity and skill set perspective, to make sure that they can effectively manage that project. As Council knows, I was effectively doing that in my prior role, prior to the untimely passing of Mr. Tarbo. It would be a little difficult, I think, at this time for me to take that responsibility on with the other hats that I'm wearing. But we do have a number of highly competent staff within the city ranks that I think we could find somebody and potentially shed some work from them and get them on board with doing that. I just, I don't want to commit to a certain position or an individual at this time. nor do a specific timeframe until we have the conversation regarding our budget and look forward to move on to these opportunities here in the near future.

Okay, thank you.

Do you, just question, quick question. Do you have to really sleep in a day or you can work without sleep? I'm getting the... You don't have to answer.

Sleep is overrated. Budgets are exciting.

Yeah. Councilor Adet, back to you.

Well, a lot of these recommendations don't require money. They just require policies, is what it sounds like, or some other type of... better process or accountability to staff to different departments so I would think that some of these things probably could be implemented pretty quickly have you identified some of the I'm assuming that you've this is not we've had this for how long or at least the management's had it for a few months or Yeah, so there has to be some, I know we did the quick wins on the money first, obviously, because we had a budgetary issue. That budgetary issue has actually grown. So we're gonna, you know, it's all hands on deck on that. But some of these things as far as financial controls and just processes, I would assume that that's something that you guys could work on or have been talking about how to implement pretty quickly over the last couple months.

Yeah, there's a list in an earlier presentation. I forget which one. I think it was the first one. It's on the right-hand side of a slide, and there's a list of 20 or 30 no-regret opportunities. These are the things that could be done relatively simply. And we tend to look at things when we're talking about improving processes. We look at them through a lean lens. So, you know, the Toyota production system, that's where lean manufacturing really started. And now that's been expanded into service organizations and civic organization, municipalities, federal government everywhere. Right? And so we're looking for waste when we do that. And that list of no regret opportunities were, you know. Those of us who are old enough to remember V8, the interocular analysis, right? It's just one of those things like, well, let's stop doing dumb. That's dumb. Let's not do that anymore, right? And there are a list of those things. So I think that's a great place to start because they're relatively benign and relatively simple. And I think people can get accustomed to the cadence of process improvement and project management. Making sure the sustainment piece is in there and getting that governance infrastructure set up and running with those kinds of things before the more complex issues are tackled with broader project teams.

Okay, great.

Okay. It's fun to chime in on the data center. I'll chime in a little bit on that. Uh, I'll save that for later, but I've chimed in a little bit on social media, but just ask some staff the question about the concept of a data center. I mean, it just sounds like it's not a viable option period. For a lot of reasons, but it's certainly just from the scale of what it requires 500 to 1000 acres just for a massive. large data center, which we really don't have that kind of acreage there. The revenue comes as an enormous investment into a building, but it doesn't really create jobs. It's just a lot of technology. It's a lot of the use of electricity. But as far as the scale, the size of the building itself, just looking at what kind of economic impact it would give for real jobs, impact in the community of people that live here. I think it's important that we focus on realistic opportunities. We look at our city land, our infrastructure, the staff time, resources that should be really directed towards projects that fits Redding's actual footprint. And as we saw in the consultant report, it's intended to identify possibilities. It doesn't mean we have to follow all those considerations. I think it's important that we remain focused on Redding's opportunities that really match Everything about as far as our land and all our resources and what fits the community as far as what the community really wants everything we do has to be representation of. The culture of writing itself, but really focused on jobs is. Really, really important for the long term if we're going to think about how to build revenue and how to fix the budget or writing it's. We have to think about how to grow the population, and you do that by focusing on building homes, more affordability of homes, subsidies to be able to help first time home buyers, but with that comes jobs. And we can grow the population, but if we don't grow the population with the right amount of jobs of industry, manufacturing, good paying jobs, that won't support really the people. so just for a lot of reasons it just says from the data center we don't have the land space but it may just be really not the most responsible thing we do with the resources that we have and to support the people here um thank you for the circle six study we invested a lot of money i think the big question early on was we're going to spend 300 000 as a huge hit to our general fund that was risky for us to spend we certainly did it just to see what kind of impact we could get to our general fund what kind of efficiencies we can find Our general fund is under significant pressure, as we all know. And with that, it helps build transparency to the public. And I think it's really important that we just continue this. It's nothing we can do to fix today or tomorrow. I expect staff will come back periodically with updates and questions to the council as far as how we want to move forward with proposals. So I think this is just the start of a conversation, but there's a lot of work to do ahead of us that's just going to come back. But more importantly, it's just really important to me that we build really good transparency with the public and the public, you know, learns to trust the council and, you know, trust the decisions that we're doing. But we really have to deal with you. And this just started with a study and it was an efficiency study, but... At the end of the day, that's my question. I asked, you know, Michael, our interim city managers, who's going to do this work? And they've heard that theme of the question there. We're overloaded in some departments. We feel understaffed, and it's just an enormous responsibility there. But it's really important that we put the work into this study. We spent the money. Now what are we going to do with it? Hopefully it's just not a study that sits in the back shelf and goes, wow, that's just a lot of work. Somebody needs to be in charge of that and be accountable to really move this forward. Otherwise, we just wasted a lot of money to do nothing about it. And the big win is going to be what we get out of this over the next, you know, many months ahead of us, the year, the two years. And, you know, we'll see the real results, you know, five years down the road, 10 years down the road. But it's really important. I can't emphasize enough. We spent a lot of money to do this. Now it's time to get to work and do something and do something that's good for the public here. So that's it. Councilor Reznor, I see you on this.

uh well i didn't want to cut you off if you had more you needed to say okay no i i could have gone and there was no funny jokes okay bummer um have you discussed with staff a proposal for what it would look like not that you need to share that all of that right now but does staff have what it would look like if we asked circle six to manage this project

or implementation?

The short answer is no. And what I'm suggesting in that light is take each of these opportunities. We have a prioritization schema that we've given you. That's our opinion, right? You now have to reconcile that with what your North Star is or what your North Stars are. So you might have a different configuration and sequencing. And then once that's in place and once that's decided, We're happy to provide proposals on a case by case basis. So you can look at 1 individual project on its own merits and understand the ROI decision point, the consulting fees versus what we think we can get out of it in terms of savings or revenue opportunity.

Thank you. I ask that comment and I say this to this entire council. I sat up here when we reviewed how much Oracle was going to cost and I wish that someone had said during that conversation, And if there's a member of staff in the room who said to me that it would be completely asinine and foolish to ever implement something like Oracle without having someone who was the sole project manager and thus Oracle implementation would be a complete disaster citywide. I wish someone had, so I say I'm sorry if one of you stood up and I just totally missed it during that timeframe. But I wish that there was someone who sat here, I'll just tell all of you, I wish that there was someone who sat here and said, implementation of new things and people who, as human beings, we just don't really like change very often. But when I, like I said earlier, when I listen to all of this, it really feels like that we have a culture or a history that feels like a lack of seriousness within the building surrounding process and procedure and financial controls and those sort of things and members of council only know what members of council know and i think that probably all of you if you were honest and i would assume that you would be would say when i ran i didn't know everything that i was going to be faced with um and so i want to make sure as i leave this dais that um i just give good advice and help put us into a scenario where other members of council are not going to be in the place where they're asking, how did we get here? Or what happened? Or how do we fix it? I want to be in a space where we are making good decisions and there's an easy system and process and a plan and we follow the plan. So I'm just letting the rest of, it's mostly for all of you. The reason why it is that I, I'll make a motion that we accept an informal presentation And I would request staff have a conversation about what a proposal would look like and bring a report back to Council. I don't know that I have a date specific, so I'm willing to hash that out, but I would like to know what our options are.

Just to clarify, do you have any specifics to what you want them to come back on a report on as far as what Circle 6 can actually accomplish for us? Is maybe something specific or something all-inclusive?

My idea is half-baked.

Let me bake that with you.

Half-baked cupcakes.

Cupcakes, brownies, whatever it takes. I think this might be a good opportunity to do a priority setting meeting and to have Circle 6 be a part of that so that if we can do a priority meeting and we identify that there is something that then they could manage, they could then... send a proposal to the city manager to see what that would look like and then we could get you know their advice of if that's something that we should do in-house or with them or some hybrid of the two or or hire them because i think obviously we're going to have to do some budget cuts. We're going to have to make some decisions. And probably if we can all get together, which happens up here, to discuss those priorities, it'll give better direction as to where we want to go. And then if we do have a project manager for pieces of that, it probably makes a lot more sense. Did you get that? That's my motion.

I think it's important that if we do a priority setting and they come back and say, yes, we can do it at this cost, it's really important that we also understand how much money we're going to save to the general fund for that. Absolutely, yes. Because we don't have cash to just continue bleed and just spend money. We need to see the real result of that, such as this will cost $25,000, but you will win $200,000 in the general fund. Well, that's a win, just do it. So I think it's important to have the data to know what kind of bang we're going to get for a buck. In the same rationale, we just spent $300,000, and we saw some wins with that. So as long as we keep winning, let's just keep spending, right?

May I make a statement? It just didn't follow up to some of the approaches. I can tell you that our approach has always been and always will be, we will do this with you on a project-by-project basis. I can tell staff we won't do this to you. Or we won't do this for you. We will do this with you. That's what's necessary for long-term sustainment. You guys have to bleed and sweat over these things with us.

Mr. Mayor, if I may, I think... On my end, I just want to clarify a few things, because what I'd heard earlier in Mr. Sprague's presentation, and I agree with this, before we jump into the what's next phase, it seemed like it was very important to have a strategic vision conversation, which I think is a little bit different than looking at what are the priorities or the immediate things that we would like to implement out of today's presentation. So I want to make sure that City Attorney Wagner and I understand specifically what the ask is. Are we asking for Mr. Sprague and his team to participate in a citywide strategic vision setting activity? Or are we asking Mr. Sprague and his team to participate in an activity where we identify which levers, for lack of a better term, should we look at polling first, or which opportunities should we move forward with first from this presentation? And I apologize, I just wanna make sure that I get clear direction and move forward with the desire of the council.

The intent of what I had asked for was, I think because we have such massive budget issues that we need to address, if we did a priority setting on how we wanted to have a strategic vision, but if parts of that included the Circle 6, that was a project that he would be able to do, then that would be identified in that meeting. He would then be able to talk about the role that Circle 6 could play in implementing that for the city. So it's sort of a hybrid of the two of the things you're talking about. We wouldn't just be going over this and saying which ones we want to do. I think we should be talking about we're going to have to make cuts. We're going to have to make decisions. What's the priority of the council to give direction to yourself? And then what are the resources to be able to work on those types of things? And if some of them are out of Circle 6, that's an option. And he can communicate sort of which projects would fall into those categories. That's sort of what I was thinking.

Let me just say a quick thing here. I do want to appreciate staff who has been very forthcoming, working with Circle 6, the transparency and a lot of effort it has taken. And I think, Nathan, you will agree with that, that the staff has really worked with you to produce this. And I know personally Michael Webb has actually been really kind of living and breathing this for the last few months. And some of the results we are seeing are the result of your and your staff's efforts. So I do want to applaud that also. We do have a finance committee also, which we'll be meeting every month. So some of this work could be taken in that also.

I'll second Aaron's motion. It is to accept the report.

I will accept it, except the data center.

Okay, on that note...

He said you accept the data set.

No, he said accept. On that note, I do think, although we did not all mention it, I believe that I can speak, although we rarely do that, speak for each other, that I can speak that data centers are not a priority of this council. And since you mentioned priority setting, and that we are not a... That's not a viable industry for our community for lots of reasons or in any way. So I know that I just spoke for all of you, but I believe that we are all in unison on that because I believe that the community just- Yeah, zero plan, zero desire. So we would like- But we're really excited about the efficiency things.

so I just want to do I need to make a motion for what I said or I was adding on to hers we already have a motion in a second so what did you want to add I was I I don't know if I did add on to yours or if I was I was doing it okay so I just want to clarify because I are they different well how about we attempt to read back the motion Only because most of the people that came here for the Circle 6 efficiency studies are interested in what's going to happen to the budget. So to include the public with what the priorities of the council are, so what direction we're going to go. This report didn't say eliminate this or eliminate that, or it blocked off a lot of that type of information. So I think it's important that the public gets to hear from the council the direction that we're going to go. How are we going to bridge the gap of this shortfall that we have? And I think the public is interested to know, you know, what that looks like and if CircleSeq is going to be part of some of those things.

And you would like to accept the report?

Yeah, and I would like to accept the report. SANS data centers. All right, I'll second that.

Do we need to read that back so we know what we're going for?

What I hear is that we want to set a special meeting, a priority setting meeting, which includes Circle 6 and their suggestions. And then to see the rest of my notes here. And in that priority setting, we'll include options to create strategic plans on how to accomplish those goals.

Yeah, a reduction of our budget.

Are we out of money to spend with Circle 6? I mean, that's gracious of them to come for free, but- You mean are we out of money?

Are we out of money and we would have to allocate more money for them to come back? So Mr. Mayor, if I could, I was going to bring a similar subject up. I'm sure that Mr. Sprague and or some of his associates would be willing to participate in that. I just think it might be a little unreasonable to request him And I don't want to put words in his mouth, but to ask him to travel out here for those proceedings. So I think that it may be more prudent for me to work with Mr. Sprague and see what the options for that are. and then us potentially or council potentially being okay with Mr. Sprague and or his team attending virtually. So I think that is something that we should probably consider and I would frankly suggest that. And then I still want to make sure I understand correctly because I think I could be misunderstanding but I think there is a little bit of a difference between the strategic vision and strategic priorities of council and I think that conversation needs to happen very likely going to start at the next council meeting, the first meeting in October. where we talk about budget issues, and I think that will naturally progress into that, and it's gonna force us to have those strategic priority conversations. And we can certainly see if Mr. Sprague and his team would be willing to attend virtually for that, but I think that will be the first step in a process of exactly what this council is talking about for this item. And then we could go from there, we could schedule or agendize follow-up agenda topics there. I just wanna make sure that I clearly understand what is the desire of council so that I can agendize it and plan for it and implement it appropriately. And I apologize. That's why I'm trying to make sure I understand and get clear direction. Because I personally didn't hear special meeting, but I could have missed that.

Yeah, I would think it would have to be a special meeting because we're going to talk about the budget and the priorities of the budget. If it needs to be after the Q4 report at the beginning of October, I think that would make sense because then we would know what we're shooting at, what the destination is. You're here, Nathan. I guess you could speak for yourself. Do you like Reading? You want to come back? You like the hotel? You like what's happening here? Or virtually would be fine, too. It's whatever you guys prefer.

It's all beautiful.

Let's talk about it. Okay, perfect. Perfect.

Love it.

gardener lights tickets will come oh yes good idea i amended it okay so we have a motion and a second and just to clarify from the record mr mayor i believe that the maker of the motion um council member resner accepted the modifications to the motion made by i accepted it yes

Okay.

The modifications.

All right, I don't see any other conversation, so I think we should vote before we change our minds. We have a motion and a second, so all in favor?

Aye.

Aye. Any oppose? No. No, that passes.

Thank you so much.

Thank you. Thank you. Thank you. Thank you. You're welcome. Thank the team as well.

My pleasure. All right.

We'll see you again.

Thank you for uniting us. Okay, moving on to Public Works. And that's not Public Works, I'm sorry. No, we dropped that item. I'm just looking at 9.1D. We're going to accept a report regarding the formation of a financial advisory committee and provide direction to the staff. And it looks like somebody is very interested to speak and start this presentation.

Good evening, Mr Mayor and members of the Council. I'm Stacy Larson. I'm an assistant city attorney for the city of Reading. Our financial advisory committee has launched. And at your request, I'm here to provide a recap and an update regarding what that committee is, how it was created and where we are in the process. Now I realize that the font on this slide is rather small, but you were all here, so remember each of these events. The idea for our financial advisory committee really got traction beginning in August, or I'm sorry, October 22nd of 2025. And that's when you as our council directed staff to bring back ideas on how to implement the financial advisory committee, which at that point we were calling a financial oversight committee. Now staff did that on December 2nd, 2025. And it was then that staff brought forward multiple models from various jurisdictions in which some jurisdictions had a joint audit committee and financial advisory committee and others had one financial advisory committee and a separate audit committee. The difference being rather important that audit committees are very retrospective. They're looking at past decisions and past materials, and they're making findings about what went wrong and what went right so that things can be done better in the future. Financial advisory committees, though, are more prospective. They're looking forward. They're participating in the budgetary process, reviewing materials, and providing recommendations to the council so that you can make good decisions. You provided direction to staff at that point of saying, we want a separate financial advisory committee. And as part of that, you considered the League of Cities article, the Financial Advisory Committee Tips and Tricks article, in which the League of Cities provided some guidance, saying, essentially, here are the great things about financial advisory committees if they're structured properly, and here are the pitfalls if they are not. Now having considered all of that, you told staff, go create a resolution and a financial advisory committee. And staff did that and came back to you on January 20th, 2026 with a proposed resolution and a proposed framework for the financial advisory committee, which by then was now being called a financial advisory committee rather than a financial oversight committee. Now there was a robust discussion on January 20th, 2026. And you had compared all the data, all the different models, weighed out what was best for the city of Reading, and directed staff to revise that resolution, primarily regarding the composition of that committee. You wanted it to be so that we had two council members appointed by the mayor for two-year terms, and five community members who would be appointed by the council. So essentially, each of you would get to appoint one of these members from the community. So staff went and did that, and on February 3rd, 2026, we came back, and that's when you adopted the resolution that created our financial advisory committee. So February 3rd, 2026 was essentially the birthday of our financial advisory committee. Now fast forward to last council meeting, September 1st, 2026, during the item 12 portion of our agenda, and you directed staff to provide a recap and or update, which I'm doing now, as well as to provide regular updates on what was happening with the financial advisory committee, such that after each financial advisory committee meeting, there would be an item on your agenda for the next council meeting, providing a summary of what had happened. Now, in the process of creating this financial advisory committee, you defined and considered the public policy of what you wanted this committee to do. And in broad strokes, that's what's here on this particular slide. You wanted it to be in an advisory role to counsel, to actually provide recommendations to you. You wanted a balanced composition. You wanted elective oversight, but also diverse community perspectives. And that led to that two council members, five community member makeup. You wanted it to be independent and have credibility. You specifically noted that you wanted expertise. Financial expertise is non-negotiable. It has to be there. But you wanted more. You wanted expertise about knowledge of the community and trends and other related matters. And you wanted to make sure there were restrictions on conflicts of interest and financial business relationships that might impair the independence because you wanted that independent input. You also wanted budget aligned meetings. You wanted this committee to review materials the staff intends to present to council. And you wanted them to evaluate the priorities, providing feedback during the budget development, amongst other tasks as well. And so this is what you created. You passed Resolution 2026-010, again on February 3rd, 2026, the birthday of our Financial Advisory Committee. And it's this three-page document. And this is the document that actually gave birth to this committee. This is the document that defines the committee, that gives it the authority it has, and defines its roles. So what does it say? In this document, you gave the committee its purpose. It is an independent advisory committee. And its purpose is to promote transparency, accountability, and long-term financial sustainability. You charged it with providing community informed perspectives on financial condition of the city on the budget development and priorities on major financial assumptions on economic trends on financial policy considerations on long term fiscal sustainability. All of course, in relation to council schools and the community's needs. So let's talk about the authority that you gave the committee. And it's actually easier to start by talking about the authority you did not give the committee. You distinctly informed the committee, as you should, that this financial advisory committee does not have administrative or legislative authority. It does not have authority to create policy. It does not have authority to direct staff or the operations of the city. It does not have authority to approve expenditures or adopt budgets or make binding decisions. But what authority did you give the financial advisory committee? You gave it the authority to advise and make recommendations about all those topics that you defined in that resolution. Subject, of course, to council direction. So how were they to accomplish this task? You provided that in the resolution as well. You asked them to adopt a regular meeting schedule. You directed them to review budget priorities and community conditions and adopt Council's goals, adopted Council's goals. You directed them to review staff prepared financial materials and presentations that staff intends to bring forward to you for consideration and feedback. And you directed them to provide that advisory input. Now throughout this entire process, you made it really clear that it's important That the financial oversight occur, but also that we maintain clear boundaries between the advisory input, the staff analysis, and the council's decision making. And so these rules are also defined in the resolution in its current form. So staff's role is to attend these financial advisory committee meetings to provide the financial information, provide analysis, make staff presentations to this financial advisory committee. The committee's role, as we've discussed already, is to review all this information, discuss those issues, evaluate the financial policies and long-term fiscal strategies, and make recommendations to you. And your role is for us to appoint those committee members, but you've already done that, to provide direction, which you've done but will continue doing, and to consider their input when they provide it, and also to make those final policy decisions. And finally, to review this committee at least every two years to determine what's working, what's not, should we continue with it, what should we tweak? So the first Financial Advisory Committee meeting was about a month ago on August 13th, 2026. And at that meeting, we provided to them an overview of the purpose, authority, roles, responsibilities, and operating framework, much like I'm doing right now, but in more depth because we spent more time with it. We also provided an overview of the Brown Act and the Public Records Act because they are subject to this. The committee elected their chair as Kurt Swanson, and the vice chair as Denise Maxwell. And they discussed how they wanted the materials to be provided to them, and they wanted binders. And they specified what they wanted in those binders, a long list on the initial binders that should be provided to them. And they set a meeting schedule. So the next meeting is actually this Thursday, and then after that it's the second Thursday of every month at 2.30 p.m., and that's beginning in October. So at our meeting on September 1st, the last time we were all here together in a council meeting, is when you requested this recap and overview and you requested those regular updates. And also it was specified that these regular updates at these council meetings would provide an opportunity by which our two council members who are on this committee, which is Mayor LaTaw and Council Member Audet, could provide to you, without violating the Brown Act, a full update of what's happening at the Financial Advisory Committee so that you can be very hands-on and knowledgeable of what's happening there and the public can be as well. So this concludes this recap update. I'm asking that you accept this informational report, and we're always open to more direction to staff, as obviously this is a work in progress. I'm available to answer any questions you may have.

Thank you. Councilor Reznor, you brought this item back, so I thought maybe I'd have you speak first to find out why you wanted to bring it back and what kind of comments you have.

I mostly wanted an update. I wanted to make sure we were all still on the same page. The slide that says they don't have authority to make policy or create policy, we did discuss that we did want financial and budget development policy input or perspective. and we wanted feedback. I know that that was a technical term, but I just wanted to say that. I'd love an update of how you both think that it's going. I know that the anticipated meeting schedule is not your current meeting schedule, and you put the new one up there. This is not the correct one, but that you shared it. The new one, sorry, the calendar.

Yes, it was updated to a red line version.

I don't have it. Yes, yes, I have that one also. I mostly would love to know where we're at and how is it going and any feelings that you have about the topic.

All right. I'll start. And I would first start by saying this is definitely a work in process just to kind of see how this group will work. It's a two-year test, but I definitely appreciate all the willingness of everybody that's serving on this financial advisory committee. It appeared at first that it could be just an enormous amount of work, and that was one of the concerns I had. I was reflecting back to see why we created this and Council created this committee to provide community-informed, forward-looking advice on the city's financial condition, budget assumptions, economic trends, long-term sustainability. And it was intended to complement the work of the city manager and the finance department, not to necessarily duplicate staff work or function as an audit committee. Um, after the committee's first meeting, um, walked away a little concerned that we didn't have a sufficiently clear agenda or shared understanding of what could be realistically accomplished. And possibly a 90 minute meeting, maybe go longer. I don't know how long the meetings will go, but. As these means were originally thought to happen every 3 or 4 times a year, but possibly now monthly. Now you still have to consider how much can we really get accomplished in such a short period of time with so many opinions in the room? We have 7 people on this committee that are each going to get a chance to speak, and that's going to consume a lot amount of time. But. Upfront, it sounds like we requested for about 6 to 10 years, possibly if historical financial information. one person described it as a truckload of documents i can see hear concern in their voices like what am i getting into i can sense that a little bit um and want to make sure it didn't unintentionally turn into an advisory group for an auditing of records um i don't want that approach to cause overwhelming of the volunteers meaning which are not many of them are not municipal budget specialists um I believe the committee's first assignment should be possibly a little bit more of a narrow or practical of what they're capable of. It's seen some early success, some early wins, examining the city's primary revenue assumptions, particularly sales tax, property tax, transient occupancy tax, discussing whether The current projections are realistic in light of our economic conditions and what the members are seeing in their own industries. It's a wide range of expertise of people that we put in this group and realizing everybody is a little different and not everybody is really capable of understanding the intensity of this budget. Certainly, I hope this committee can identify you know, warning signs, weaknesses, consumer spending changes in construction or property values or potential decline in tourism, lodging activity. Advise the council whether revenue assumptions may be too optimistic and they can also contribute to an ending cash shortfall. But we know this committee is a two-year test of whether this committee provides meaningful value to the council. And to make that test fair, we need clear council, I think, directed assignments as far as what we want this group to do. They align with concise staff prepared materials, realistic objectives of what this group can do. Because again, just going back to the timeframe, they're 90 minute meetings, maybe two hours. And realistically, what can this committee really be capable of doing in such a short amount of time? And we should be able to find some achievable outcomes out of this group and modify the structure or just consider, you know, this committee's goals really there. But that was just my takeaway, just seeing it is going to be a lot of work. And I don't know if every member on that group expected this amount of work, but we should really have some clear expectations for them and avoid burnout and truly make sure this is an advisory group. So that was my takeaway. There's a lot of work to be done, and there's really a lot of great opportunity out of this group. And it'll be really exciting to see how this moves forward and what we do. But Councillor Reznor, you're first. I see you there. So, and then Councillor Dett will go to you.

I have a couple of questions. In your first couple of meetings, or do you have intention?

Do you want me to, because I can, I went to a totally different meeting. So, let me give you my take on it. Of the five that are not council members, three have worked in municipal finance. So, One is, and then the other one's a CEO and the other one's a financial planner. So it's a very strong group. And we had two objectives. What do we want to work on first? We went over the Brown Act, which I think was really valuable. And then we basically decided what did we want to focus on first? And so we We determined 2 things this the cadence of which we're going to meet and what are we going to try to tackle 1st? And so 1 of the questions that came from the chair was, I'd really like to know more about your 10 year plan. And I thought that's a great place to start. And what I had suggested is. You know what we went through the last year was very difficult for everybody and I I would never want to see that happen again where Council is asking for things and staff saying you don't need it or you already have it or you know. So to have a. a community group of people a little smarter than your average bear because they are in finance to look at those documents and say yeah you're getting what you need not how to vote not what to do but not our job which is our responsibility but to say this is not adequate enough information or you're getting what you need maybe you need to you know consult with somebody else about understanding it or meet with staff again But could we then, so what I asked him was, I said, would you be willing to just get the quarterly report and just see how you guys receive it? Because the council gets no training in finance. It gets no training in what the reports are that you're going to get. Whoever gets elected in the next election, when you come onto the council, you get a staff report on a Thursday, and it goes to your front door, and then that's it. And when you come into your meeting and your agenda review with the city manager, you're going to ask whatever questions you want to ask. You may be able to review some, but in an hour, an hour and a half, you're not going to get a training. And so you're asked to make big decisions with not a lot of training. So what I asked him in response to wanting to know about the tenure is, Can we just look at the quarterly report? So you could then determine, even with what you know, is this adequate enough information to be making good decisions? And so that is what we landed on. And what he asked for was budget to actuals. And in the quarterly reports, you get that. So we asked for the last three years of quarterly reports because budget actuals looks different in 23, 24, and 25. And so that's what we got. We got those three quarterly reports as well as a current 10-year plan, which is one page. And then, of course, the audit and the budget books that had been produced for the year. So you have something to compare it to. So that's the breadth of it. We don't need tons of paperwork. We're really just going to walk through a quarterly report and see what kind of questions come up, what kind of information that they're saying, gosh, it'd be great to learn more about this. And I'm hoping that what comes out of that eventually, which it may take a couple months because we're going to meet once a month to start, but we also said maybe if we need more and we really find something important, we'll meet a little bit later. More frequently, that's really what we're going to go over first. What should the reports look like? You know, does it look like you're getting enough information and what would be helpful to the Council in regards to just. The financial information you have when you're making a decision. So that's what we're going to look at. Everybody was amenable. They got their binders early, which was really helpful. Staff and our city manager made sure that we got all that information that we asked for early. And so people have had time to really look through it. But we're going to go step by step. And that's the first task that we're going to tackle. It may take a couple months. But we don't want to burn anybody out. We're not asking them to do our jobs. We're really just trying to figure out what's the best resource to give to the council with what is currently where we've had a conflict between council and staff. So I'm very hopeful for that. I think it can evolve into other things that I think when we come back and talk about it, I think that would be important. One thing I do want to point out though, that's in this report is that it, for the first time, And as you saw, this has come back many, many times. Utility got added into this report somehow that we're going to add utility financial matters. And I would say that's something that maybe because the utility already has working groups of the community members to do advisory or to look at rate increases or they already create those groups themselves. I don't think that this group should be targeted to do that, especially at the onset, because really the target should be budgets. And over time, if they learn more, if we move towards that, I think that's something to discuss. But right now, I don't want to, like, to your point, put too many things on the plate, and then we're taking nibbles of things instead of really deep diving and the the committee said the same thing. They said, if we meet every quarterly and we tackle too many things, we're going to be this deep. And if you want us to really dig in, we have to meet more frequently and handle one thing at a time. in regards to that i just think it's premature to add um that's just a super big deal and i i believe the last one that they had was was three days long so a 30 minutes which just wouldn't do it i'm not ruling it out because we may as a as a team decide we want help with that but um i would say for now i think it's that makes it too big

I forgot one comment, and I'd love your feedback or the feedback, but truly what I love about this financial advisory group is they're supposed to get access to documents possibly before we do it, which means, for example, October we have quarterly report coming out. If the advisory committee could have access to that report, it might delay some reporting that comes back to council, but it would be really effective to say that group is really doing the job. as an advisory. So they look at these financial documents or come to us in October and then do they come to us next after that and where we can hear their analysis of the financial reports are going to come back to us.

I hear the value of what you're saying. I think it's premature since they don't even know what's in the reports yet so i think maybe over time that may be something that when there's a discrepancy or an issue or a deeper dive that's required that maybe we you know get their two cents about that as well um if you remember we were supposed to have it on this this meeting and so when that when the committee asked if we would if the Q4 would be available September 17th, they had said it was going to be on this report. And so naturally they would have seen it two days later. But I don't dislike that idea. I just think it's probably too soon for this committee to be considering taking documents that we haven't seen.

Or they could also review after our council meeting in October if we wanted to. Oh, for sure.

I think they probably will because we're going over quarterlies. Yeah, totally. That's good. Is that helpful?

May I just make one suggestion? Thank you to both of you. I kind of started this idea, so this is what I'm really looking for in the first thing. Because in the past, there have been some debate about whether these reports are actually correct or not. So at the very minimum, if they can review those reports before it comes to the council and say yes, these reports are reliable or not. Can we at least do that? Wouldn't that be the role of the auditing committee? No, no, that is retrospective, but like all the yearly and quarterly budget reports that come out, that has been a question in the past.

So there are some issues of what's included, but they wouldn't know the answer to that. I think the issue that I had was that budget taxables were not included in two years of reports, and I was asking for them, and we were being told- you already have them, it's this box. And I'm like, no, that's not a thorough report. And there was just this argument that, no, you have what you need. And I'm like, no, I don't think we have what we need. And so if we had this financial advisory, we could just go to them instead of having that constant conversation here. It's like, let's go to them. But I don't think that they would know if something is missing. So for instance, The UAL did not get in. The increases didn't get included. They wouldn't know.

What I'm saying is that's why I would like to rely on them to tell us that, yes, this is all inclusive or not, or something is missing.

I just don't think that they would know that answer. Your finance director should be able to tell you that. I think if we fund, I don't. I don't think that they can be—if you want any one of them to be an advisor to you where you give them the report and they give you their opinion, but I'm looking at structural. Like, are we getting the actual documents we need? Are we—is it—are you—like, so that by policy, if we need to create a policy to make sure that we get accurate information and adequate disclosure, that they could advise on that. I don't—as far as, like, how should we vote on this, I think that's—I don't think we need a committee for that. We could privately be asking them for those things.

We have two speakers. How about we get to the speakers? Oh, yeah. That'd be great. Do a little timeout, refresh here. Leslie and Mike Quinn, who's on our financial advisory committee.

Oh, there you go. Fantastic.

Fantastic.

In the flesh.

Yeah.

I promise I would rather just come up once during public comment, get it all out of the way, and not be I really don't want to be the crazy person. I think what was clear from the community is that we wanted to see the items we were told weren't issues addressed as issues. I think what it was clear that we said we wanted to see in every input that we talked about, it wasn't just me, it was many people from the community saying that we wanted them to actually be able to see Tenessa's presentation and see the numbers and see the red lines and see, and I know, the first step to fixing a problem is acknowledging that we have a problem. And I've heard, four of you, four and a half of you acknowledge we have a problem. And so publicly, thank you, Erin. You've done a huge about face. You've really been diving in. Thank you. I was very hard on you because you were very, we don't have a problem. And then your very acknowledgement that we have a problem is huge. How you've been working with Tenessa has been huge. It's been very, it makes me want to work with and be nice, right? Like, It's got this like let's unite together thing. It's good. We need to see The acknowledgement that there's a problem, but I think that this group needs to see the presentation we just saw. I think they need to see to NASA's red lines and her presentation. And I think they need to then look through those answers. Look through those. I think he called it the no regrets list, right? Like, let's print that no regrets list and give that to this group. And say, as people with financial input in our community, as people who have volunteered to do this extra work. What are your thoughts and then include them? Because I think that that strategy session priority list session that you talked about was genius. Let's include them in on that. Let's say. Here's the no regrets list from circle 6. Here's our issues. Yes, we have a problem. We've now all acknowledged we have a problem. And how are we going to start breaking that down? And I like that it's built with people who know better than most of us, because I would probably just be yelling at people and that would not be productive. So thank you to the people who are taking the time to do that. But let's make it productive. Let's not just have a meeting to have a meeting to go over this presentation.

i i got nothing new out of it so let's let's have it be something where we get something out of it i would appreciate that thank you leslie mike quinn back from alaska he was tuning in from alaska in our last meeting so yeah very committed somebody had to do it

I want you to know that this committee is a very strong committee. You have excellent people on there. I want to meet once a day. for three hours for a while. I was on the Electric Utility Commission. The same thing came up. They said, well, you're not meeting often enough. Fine, let's meet some more until we get into these issues. We're going to dive into that. This is going to be a committee that's going to come back with positive things. It's going to be looking at, as I look down the list of people on there, each one has a strength. And some of us have dealt very heavily with finances in like a city situation before. It was really important. I read through this whole circle six and was cheering on what they were saying and actually approached the gentleman as he left because there's a couple other things that I want him to look at, too. But I want you to have some confidence in here. And if we say we're going to meet once a week, if that's what it's going to be, then you're going to find out that the people on there, when you volunteer for a committee, you volunteer to get the job done. It's like going to war, you know, the people in World War Two, they started out in Normandy and they didn't stop till they got to Berlin. You didn't just get to stop and do it whenever you feel like it. And right now, I think the city needs, you know, some outside looking at it. Will we be able to review this? Looking at the budgets and then we'll expect the concerns from you. Where do you see the problems? that are happening right now in the city, in the budget and all the things that we're going through. And every one of us has had businesses and we've all had to do the same thing. And it's not easy and I accept that and I know everybody else does too. So we look forward to this. Thank you.

Mike, we have very high expectations from you and the rest of the committee members. And I have all the confidence that you will do it right.

Thank you. And I hope you do such a good job that we can afford to buy you a clock when your term is done, because that's what we like to hand out. So it's fancy. So we'll be able to afford that later. All right. Any other comments from council? Or did we answer all the questions?

No, I should have mentioned, and I'm glad that Mr. Quinn said that he thinks everybody is enjoying it. The feedback I have received, from the person who I appointed is that they're really looking forward to the work and that this group is doing also. So I am excited. Thank you. Sounds like you guys are all on the right track.

Make a motion to accept the report. Can I strike out utility financial matters on page two with your motion?

Yeah, that they can take out.

I'll second that.

Yeah, they can take it out.

Okay, thanks.

Okay, we have a motion, a second, and an opportunity to vote. All in favor? Yes. Aye.

Mayor Littell. Vote. Apologies. So I heard Councilmember Audet indicate that you don't want the Financial Advisory Committee to consider the REU rate item that was on. the agenda for Thursday. I'm just making sure we're all on the same page over here.

It's on page two. Okay, understood. It got added.

Were you referring to utilities in general?

I feel like the committee can handle that at the committee if it got put onto the agenda, but I'm just saying for purposes of us to have some continuity that the council's not putting that on the list. We reserve the right in the future to do that, but not at this point.

Yeah, I think Americans set their own priorities.

Yeah.

And we are okay with that, that yes, they do not have to take on the utilities.

I can be agreeable to that.

Okay.

Aye, thank you. We are kind of already voted, so. Aye. Yes, all right. It's getting late, but I've got a lot of energy, let's keep going. So we're going to go to the items that we pulled now. And let's see, we started with, we had 4.1A, which is now 9.1A. I think you pulled that, Councilor Added, is that right? No. No, that was you, Erin?

Okay. Jason, could you give us just a little bit of background? I know you don't have any sort of, either of you. I don't care, you can arm wrestle for who gives.

Councilmember Reznor, thank you for that. I'll provide a few tidbits of information. Obviously, Mr. Gibalisco from the city manager's office is here and he can provide more detail. If I recall correctly, items 4.1a and 4.1b were pulled, so we're talking about first the purchase and sale agreement that we're recommending be amended. Essentially what we're talking about here is an extension of the due diligence period by approximately two and a half months-ish regarding lot number nine. And this is a purchase and sale agreement with Fall River Brewery, so it will push out the escrow period pretty much until the end of the calendar year, December 21st. And it should be noted that when this transaction is completed, the net proceeds of the transaction will go into the capital funds account that funds from the property sales have been going into from Stillwater Business Park for a number of years now.

Two questions. One, do we know how many lots or how many acres we roughly still have available?

I will defer to Mr. Gibalisco for that. I'm sorry, I didn't prepare that information. I do have it, and I can email it to you tomorrow.

I see that the EDC is in the... I'll let her walk up while I ask my next question. That money has been going into Capital Project Fund. And we, actually it wasn't this council's, lots of councils before, decided that that was going to be a proverbial piggy bank that that money is going into. And it's earmarked for that. Is there anything else going in the capital project fund and what does it take for

Council to touch on I'll call it our piggy bank or our savings account that is specifically for the infrastructure of Expanding so I can touch on that first and I'm gonna I'm gonna ask my finance friends out in the audience to plug their ears because I may use some terms similar to piggy bank Okay, but essentially you're correct that funds from those property transactions. The net funds have been going into that account since still water business parks inception, which I believe was a number of years ago and with the intent of those funds being used and leveraged to go after EDA and other grants to build the infrastructure that the city is required to construct in this effort in which we are the developers. And so that is the the primary focus of having that separate piggy bank again if you will So that the city has the funds to leverage to meet grant match requirements when we are successfully able to obtain a grant which I'm trying I'm not trying to jump to the next item, but they're tied together and Good news, we were able to receive an EDA grant to extend Venture Parkway from its current terminus to the northern end of the bridge. It's roughly a $10 million project without the numbers sitting right in front of me. So we'll be able to use the grant to fund about 80% of that. And then leverage funds from this again piggy bank, if you will, has been receiving the net proceeds from property transactions for a number of years. I would be remiss if I didn't mention that my understanding with previous projects along Venture Parkway that utility enterprise funds have chipped in for certain. infrastructure components, which does make sense to me because as these parcels sell, they do pay impact fees and TIF fees and otherwise. So in the past, what has happened is eligible utility costs have been included in the funding structure for those projects. And I would assume that as the team moves forward with final design and estimating on this particular phase, that the team would definitely look at that and come back to council with a Again, a funding strategy or a financial plan that would look at are there any costs that the utilities are able to pick up and are they legitimate so that we're using every fund source appropriately.

So that capital project piggy bank fund that is earmarked and that we deposit money into anytime that we sell a property, do we know roughly how much money is sitting in there? at this small, you could give me like ballpark one million, four million.

I'm gonna say a number. Is it four? Three to five.

Three?

Three to five.

That's what I was thinking about, four.

I'm feeling pretty good about myself because I was gonna say 3.8 was the number that I recalled.

Okay. Is this only from the proceeds of Stillwater that's in the capital project grant fund, general fund?

That's my understanding now keep in mind to that other activities have been funded out of there. I want to see the grazing leases as well as pre engineering activities and other things for the subsequent projects down there along venture Parkway so that again that piggy bank if you will is funding a lot of or if not all of the activities out there with the intent that as parcels get to close of escrow and we actually finalize the transaction. That the proceeds go in there and it keeps funding subsequent phases until the project is ultimately completed. I should mention that upon completion of phase two, if you will, that was tied to 4.1B, which is now 9.1B, there's essentially one phase remaining, which would be from the southern terminus of the bridge down to Fig Tree. and then along Fig Tree over to Airport Road. So we're marching along, and we've seen a lot of recent activity out there, which I'm sure Mrs. Baer from the EDC could talk to if Council would like.

Can you brief me, or does anyone know what the Council policy looks like for money that we've given a proverbial earmark to?

I would have to come back with a detailed analysis of that, but certainly it's going to take a minimum of three of you to approve moving forward with any funds from that piggy bank, if you will, as we come back and request moving forward with a project and the appropriate funding sources. Are you talking about moving it somewhere else?

I'm not intent. I know that we are... When previous councils set aside a policy or vote that we're going to create a savings account for a thing that we know in the future we need to save for, I want to make sure, I'm just wondering what our policy is for times like this when they come about where times are tough that we're not stealing. Do we have a policy so we can't steal from piggy banks? You know, like the crash it open and we take it from where we're supposed to be saving?

I don't believe we do, but I would have to look into that and double check. And I'd be happy to do that for you.

Emailing me that policy would totally be okay unless everybody else wants it. Do you guys have a number? So I don't have to make you sit down.

So here we go. I'm gonna go parcel by parcel. One and two are both available. It's approximately 15 to 20 acres. Not all of that is usable. We also have six be available at approximately five acres, eight at 7.5 acres and 10 at 6.9 acres. Those are all available, not encumbered or in discussion, any negotiations at this time. 11B is approximately 22.8 acres. Amazon who purchased parcel 11 has an option on parcel 11B, so that property is encumbered. Parcel 13 is in negotiation with a signed letter of terms. And then 14 and 15 are under contract. And then parcel 16 is 5.3 totally available. So 10 parcels are either sold, encumbered, or in some form of contract or negotiation. And then we have six parcels still available with the largest contiguous being that 15 to 20 acres. And I don't know if you want the total acreage from there, but okay.

Nope, that's great. I wrote down your notes. Thank you. Or I wrote that down in my notes.

Councilor Odette. So I know that we've been talking about this fund, the capital fund, to make sure that it pays for the infrastructure costs. from Stillwater. So I'm very concerned about using utility funds because that's rate payer funds to now fund this $1.982 million. I don't think rate payers should be paying for that. I think that the Stillwater Business Park, the sales of those properties should be funding that match. So I'm very concerned. Maybe we can do that, but I don't think that we should do that.

So I...

If I may, Mayor and members of the Council, so I understand the item on the agenda tonight to be the amendment to the to the agreement to extend the term?

No, this is a different... Of the due diligence? Are you on to B now? No, we're on B. We're discussing the... Did we take action on A? No. No, but we've been discussing... Literally, she said they cross over and we're talking about the...

Okay, so if you're considering them jointly, that's fine. I just wanted to make sure we're all clear that that's what you're doing.

Yes, that is... That works fine.

So, Council Member Audet, in response to your comment there, certainly as we develop the project, We're going to look at, are there any costs that are eligible to be borne by the utilities? Again, because when those parcels are sold, those parcels, they are paying impact fees, and therefore there are eligible infrastructure components that could be attributed to the utilities that would be offset by the impact fees that would be collected by the utilities. That could be certainly something that would be well within Council's purview if they decided they did not want to use utility funds to fund that infrastructure. That would certainly be within your purview.

i would want if if you're saying that we did that in the past that when the other projects um down there happened that that that the city used used utility funds i would want before i would approve this i would want to see how that happened, what the percentage was, and what that looks like. Because we've been talking about how the sale from these parcels was supposed to be paying for the match. And now this is on consent. And we didn't discuss a change of what our intentions were and how we were going to be paying for it. We have been talking for a while that it comes out of the proceeds. So this is a switch from what we had been told previously. So I just want to make sure that I don't want to use ratepayer funds to do something that we have a designated fund to be able to cover. So if in the past that happened, I would want to know when did it happen, I'd want to see that staff report, and I'd want to see what that percentage actually was to make sure that we're doing everything we can not to charge the ratepayers for this work when we set aside this fund specifically for that.

We can certainly do that. For clarity, it's my understanding that item 4.1b is simply to accept the grant and move forward with essentially accepting that.

Well, I'd also be accepting that you're going to use these funds to pay for it. So I would, if you want to take that out of it, I'm happy to accept the grant, but I don't want to accept that we're going to use city utility funds to pay for the match. Unless we have more information about that.

So we could certainly, if this was amenable to council, we could certainly modify that to say that Obviously, when we come back with a complete funding plan for that specific project, we could bring information back regarding to what could possibly be eligible for funding by utilities, what has happened in the past, and the logic and reasoning for that, and present that as an option to Council for consideration. We could present both options.

That would be amazing.

That could be something very simply accomplished if that's the desire of the Council.

I think that'd be great to have that information before we make that decision. Yeah, why would we? That's my question. Yeah, that's what I'm asking. Yeah, I get it.

That's what she's saying, but that's not what that paragraph. I got you. She's asking, saying that's not what the paragraph alludes to.

I understand. I think it's certainly well within the purview of council what funds they use. Absolutely.

Let me just get this clarification. You are using, you're talking about building some utility infrastructure there. Okay. Yeah, you're not spending those money on something else. You're spending on the utilities infrastructure. But that's a conversation we can have later, but right now it's just accepting the credit.

Well, no, I want to strike this from, I mean, I'm happy to accept it as, As long as we don't make any decision on its funding source till we get more information, because are you already paid tens of millions of dollars for the infrastructure? It's still water. So this isn't the first time. This is just the next time. So before we go to rate payers. Before we go to rate payers, if we have a fund specifically for that, I'd rather not incur more cost to rate payers.

I understand, but the specific recommendation right now is number one and number two.

Right, but when you put it in the fiscal impact, then they'll point to this to say that we approved that they could take it out of city utility funds.

No, we're not approving that fund right now. We are. We're not approving that expense right now. We're just approving the acceptance. You are.

You are. So if I may- Not specifically, but you are this mix.

I- If I may, Mr. Mayor, Honorable Mayor, I believe there's language in the fiscal to cover that. Essentially, the last sentence talks about when staff have identified the exact amounts allowed by source, a budget resolution will be brought back to council for appropriate grant funds and associated matching funding.

This is my point. So you're going to come back to tell us the grant implication. You're not coming back for permission to spend utility funds. And that's what I'm saying. Before I agree that you're going to use city utility funds, which I don't agree with, but Even still, you're not telling me how much is going to be utility funds. You're going to bring back how much of these other funds. And so I just want to make sure that nothing, if you're going to try to use city utility funds, we should know exactly how much you're planning to use. so that we can have that discussion if we want rate payers to be paying that, as opposed to the fund that we set up specifically for this.

Certainly, my intention, as written in the fiscal, is to bring back a budget resolution that would include all funding sources for this project, including the grant. That was the intent of that sentence there. Perfect.

Let's do that. That's perfect.

If that is amenable to Council, that will continue to move down that path. And certainly, at that point, if the potential funding sources that are identified are not... deemed appropriate by council, we could obviously pivot. And that would be very easy to do.

Yeah. So I don't want it as written because it only says that you're going to bring back grant funds and matching funds. I just want to make sure that utility funds is included, if that's amenable. Or we can just say no funding until it comes back.

I'm sorry.

Can I attempt to make a motion to, I know that we said we were considering these together. Can I separate them? Yeah. if everyone's admittable to that. I'm gonna make a motion on 4.1A, or sorry, 9.1A, to approve the First Amendment and reinstatement to the real estate purchase, and to authorize the mayor to execute all related documents, find the sale of a city-owned property is categorically exempt from review under CEQA.

I'll second it.

All in favor. Aye.

Aye.

Aye. Got you.

Okay. I'll make a motion for 4.1B to accept the grant funds with the caveat that no funding, any funding will come back to the council before approval.

Can I... Say that one more time. Can I make an alternate? Oh, please do. Motion. I would be willing to accept the grant funds and for staff to bring back a budget breakdown. Perfect. So if there are, because I asked Mr. Webb today, can you use utility funds? And he said, legally, you can only use utility funds for purposes that are the utilities. Did I say that correctly? Okay, perfect. So- If there are things that are specific to the utility, that would have to be lined out in a budget item. Okay.

I'll second it.

All in favor?

We don't have it up here yet.

We all already voted. On B?

How was A?

Yeah, we need 9.1.

We haven't voted on B yet. Aye. We did A.

We just need B.

We just do it verbally.

Okay. Aye. Are you on B? Sure. It's not coming out.

It's not coming out.

There's no B up here.

They got it. That's okay. They got it.

They got it. It was 5-0. There it is. We're on a roll, really.

It's up now. Okay. Are we ready to move on to 9.6B? Who pulled that item? I did. Okay.

I did. So I saw in the cash report that we were negative 2.3 million. And on this item, it looked like they're requesting, I had questions, it's a five-year loan. It looks like we will be reimbursed for 1.2 million of that. It's a cost of 65,000, but is it a five-year loan? Is that right?

No, ma'am. Travis Binney, Director of Community Services and Airports. So the loan is essentially more or less like a line of credit that's going to cash flow a grant. So it's not a loan that's going to span the five year time frame. That was the amount of time that it would take to collect debt that the airport currently owes to the general fund. And that is something that will be brought back at a future date. What this item is for specifically is to cash flow a grant, which will have periodic reimbursements along the way. And then a PFC component, which is a passenger facility charge. Those will then be incrementally dispersed back with the reimbursements to the water utility, which will be cash flowing. So they'll never really be out 1.3 million, it's just encumbering 1.3 million for the projects. And the airport will pay that back alongside FAA, close that out within about 16 months.

16 months. So it sounds like the airport is having financial issues.

It would appear that way on paper and I can understand that it is essentially a cash flow issue with the way are collected. So, a large chunk of are owed for the runway project. Say, what are the passenger facility charge? Essentially a fee on a ticket. We have to apply with the FAA to be able to charge those fees and have a project that is eligible for them. We then collect those fees throughout the year and use those to fund these projects. So a lot of times you're funding something up front and collecting PFCs on the back end to pay for it. So the largest portion of the currently owed PFCs, which is not the item that we're, it's not necessarily the item that's being discussed but it's a component of it that is from the runway project and those will be paid out over a number of years what we will do in the future is memorialize this so it's a transparent single source of funding that everyone can see exactly what is owed by the airport from fronted pfcs it would be great if we got a chart on where we're at with the airport because i was not aware that we were having a cash flow problem or a budget problem and i know this is

you know, like a word problem here, but it would be nice to see it on a chart, what the terms are, when it's gonna be paid back, when the increments of when we expect to be paid are, so that it's clear we can track it. So when I get a proof of cash report, I can see if we're making progress or we're making the progress we said we were going to make. So if we could get just, I'll approve this, I get it. I just would like to see it more clearly, like in a chart, so that I can track it when we get the rest of our reports and just stay ahead of it.

Yes, ma'am. And we intend to have a more detailed breakdown when we come back to kind of solve this issue so that it is more trackable and understandable, because right now it's just based on multiple compiling council approved grants and projects and things like that. And I'd like to move it all into one place where it's easily visible.

So it sounds like you listen to Circle Six and you're going to consolidate all that information. I guess you could say that. Huh?

I guess you could say that.

OK, that'd be great. I'd appreciate that. Thanks, Trumps.

Are there any further questions?

I don't have any more questions. I'll make a motion to approve.

Thank you. Second.

Second.

Okay, all in favor?

Aye.

Aye. Aye. Okay, 9.15A. I think that was you that pulled that.

Yes, so let's see. A, I did. I pulled this. So we are appointing the interims, which I have not done before. So I guess there's a rule that says that we have certain positions we do that for. Michael, do you want to tell us about that? Oh, go. Hi, good evening.

Yes, so the municipal code has... Specific codes, I need to pull them up, which specific codes they are. But for the chief of police, fire chief, and director of finance, they are selected by the city manager, but subject to the approval of the council.

The interims or all of them?

Just the position in general. And so because we want to formally place these individuals into the position, we still need to follow the municipal code.

Okay, so if anybody is in that position. they get the approval of council, whether it's interim or permanent.

And if I may, Council Member Odette, I think we should pull up the language from your municipal code, because it says that we bring that appointment to you for confirmation, essentially, after it's been made by the city manager. But I want to find you the exact language. It's going to take me a second.

The question I had was, is it just interim, or is it just that position as a whole, whether it's an interim or a both? Okay.

So just like we've had conversations just like the police chief, the city manager will hire the police chief. All that we can do is veto it, but we don't get to hand select who the police chief will be.

Sure, sure. Subject approval by the city council. Is Joe here? Yep. Hi, Joe. Can you come up, Joe? We just had a whole presentation about financial controls. So the public is very excited to hear from you and to put a face to the name of who is now going to be the Interim Finance Director. Hi.

Good evening. Joe Bowers, Assistant Director of Electric Utility and Interim Finance Director, pending your approval.

Good. Very good. So can you tell the public a little bit about what you do currently?

I am the assistant director of the electric utility of resources. So there's three assistant directors in electric. I'm one of them. I oversee the resources division. There's four components of that. It's the real-time energy trading group, settlements. It's the long-term power contracts and planning group. It's also the financial services group, and it's also the power plant. The majority of my employees actually work at the power plant.

Okay, so much cooler than working at City Hall, but that's fine. We appreciate you coming over. Can you provide to the public an expectation of what they can expect as an interim since you're still doing the job? I got a couple questions about, because you're doing both. So what can the public sort of expect from the financial side that you're going to be doing?

So for the period of time that I'll be doing this, I'll be fulfilling both roles. So Nick has always got 40 hours a week out of me, so they'll be getting more out of me. The plan is to work more. I have worked 60-hour weeks in my career, so I'm expecting some of those to look like that in the coming months. But I do know that it's not sustainable, so the plan is to try and get you a permanent finance director as quickly as possible.

Okay.

Do you know who is doing the recruitment for the finance director? Is it outside or inside?

I do not know that.

Okay, it's in the report. So it looks like for the finance director, our personnel department is doing that recruitment. Is that right?

So right now, we're evaluating all options. And one scenario is to have the personnel department put out a recruitment as soon as possible for the position. We're contemplating not going the full recruitment method because we think we might have a shot at attracting someone without doing that. So I'm working with Mr. Bowers, who's wearing multiple hats now, and a few of the other key staff within city to take a quick look at the job class specification, make sure we're comfortable with it. And then once we get to that point, we'd like to get that out on the street as soon as possible. Obviously, we know that Mr. Bowers is picking up a pretty large workload. He already has more than a full-time job. So we want to respect that as much as possible.

So as far as the Circle 6 stuff, that's not something that you are going to be going into and tackling. You're really just going to be holding down the fort until we can recruit and pull in a finance director.

So for everyone's awareness, the finance director oversees the administrative functions of the treasurer's office, not the actually elected treasurer's duties, the finance department, and the purchasing office. There is a purchasing officer for the city of Reading. There is an administrator of the treasurer's office that works there, and there is also two finance officers in finance. So my intention is to give the professionals that do that day-to-day work, the tools, training, and support they need to do their job, and kind of try to stay out of the day-to-day stuff. Like I said, going back, there's over 50 people that work in resources and five of them do finance. So since the launch of Oracle and my promotion to assistant director around that same time, I am not your day-to-day accountant, working director that knows the ins and outs of Oracle. So I'm just not even equipped to do that. But I am what you would consider as like a subject matter expert on accounting principles, policies, financial planning. So when it comes to trying to get guidance on the bigger decisions, I want to be there to provide them that support, help maybe translate that between Mr. Webb and the staff. That's kind of my role.

That's great. Okay, well, thank you for making that very clear. All right. Thank you.

Thank you for agreeing to do that. Thank you. It also is important that we buy and sell energy.

Yeah, that's a much cooler job. Okay. So I'll make the motion to approve this. I'll second.

All right, all in favor? Aye. Okay, the last item pulled.

I also met with the interim fire chief today to also ask him all my questions.

Does anybody else have any questions for the nobody?

Do you want to make them come up here?

No, I don't want to. I mean, I will just say that.

Well, can you just show your face so the public knows who you are so they know? Well, no, you got to come up here. Say hello. Say your name. You know, for our benefit, we know who you are. But for the public, when we say, I hear it actually quite often, like, who are these nameless, faceless interim people? And we actually have, you know. Really great staff that's stepping into these things. So can you tell everybody who you are?

Yes, good evening. My name is Jason Foley. Currently the Deputy Chief of Operations for the Fire Department. And with your blessing, hopefully the Interim Fire Chief. 22 years with Reading Fire Department. And I'm honored and privileged to have this opportunity for you guys to make the decision on your next Interim Fire Chief.

And you're going to be doing double duty, I'm assuming, as well. You're still the deputy, or you'll be handling operations and chief duties?

Yes. To some extent, I'll be wearing two hats. My gracious staff below me, I was able to delegate some of my more heavy lift work, which has helped me tremendously working with city administrators to refocus my energy to the overall needs of the fire department.

Yeah, there's a lot of stuff in there. So do you feel like you'll be helping with the Circle 6 stuff?

I do.

Awesome. That's great. I think that's my only question.

I'll make the motion to approve that point.

Thank you. Thank you.

If I may just make a comment after the approval, it's all approved. But I really want to appreciate all the staff members who really stepped up in some... difficult times for the city, and every one of you has stepped up to take extra responsibility, spend extra hours on it. And I just want you to know sometimes we don't speak enough to appreciate you for that. And sometimes you face some challenges as well as some not so kind words, but I want to tell you that we all appreciate you a lot. Thank you.

Is the recruitment for fire going to be in house or out of house?

I'm currently looking into that. I'm leaning towards an in-house one for that as well, but I want to sit down and have a chat with personnel director Kibler as well as a few other folks before I make that decision.

When will the public know if that recruitment is in-house or out-of-house?

Assuming we go the in-house route, my plan would be to use the communications team to use socials and other tools that they have like we would do for any other position within the city. Okay. I would consider a press release, but again, I want to walk through those options and kind of see that we're getting the message out appropriately that, you know, the position's out in advertising.

Great.

We've never had so many in terms ever, so we are grateful for you. All right, we have a motion second. Yes. All in favor? Aye. Okay, there's nothing else pulled, so we're going to move on to council travel reports. Is there anything to report from council? Any items from council members for future topics?

I have some.

You have some?

I do. Are you shocked?

Not surprised.

It's been a while. One, I'd like a Supermoto update and where things are with that RFP and where things are at with Supermoto. Everybody amenable to that? Okay.

I'm just surprised to see that still continues to be an issue, which is unfortunate.

I know, that's shocking. The other thing is I'd like a report on this Safer Grant. As I've gone through when we did this financial advisory group, I'm going through the quarterly reports again, and it comes up over and over and over again. And I'd like a report of what happened with that, the history of it, and when it was added to the budget, and what the current status of it is now. We're all good with that?

Did you want to report back to council, or did you just want the report for yourself?

No, no, I want the report back to council. Council Member Munz and I both said yes. Awesome.

Any other ideas? All right. We are going to go back. Oh, yeah.

I'm sorry. Civic Center, do we have any update on the Civic Center RFP process?

I'm happy to report. I believe that we had five responders respond. We're currently working to put together our RFP selection committee. which I've worked with Director Minney, and we're going to go the route of having some externals assist us with that to make sure for this critical decision that we've really got the full community's perspective and what we want to do there. So we hope to have that review process start here very soon. Thank you.

What is the next step?

The first, excuse me, the next step in that would be to... get the documents to the review committee, give them time to review them. I'm assuming we'll probably have a crash course with them, for lack of a better term, to just go over the scoring criteria, the matrix, and how you score these RFPs to give them some groundwork there. And then collect the information, score it. There's probably a check-in with the city attorney's office to make sure we're not missing anything. And then... back to you guys or gals.

Can any of us go to those meetings where they're being scored? Like the ad hoc, for instance?

If I may, Mr. Mayor, I'm happy to either let your city manager answer that question, but it's not an item on your agenda, so we really should not get any further into that. Got it.

Okay. No other ideas. We're going to go back to closed session, but this meeting is adjourned.

Thank you.