Board of Commissioners - Regular Meeting

Good evening everyone. Like to welcome you to the May 7th, 2026 meeting of the mayor and county commissioners. Can I have a roll call, please? Emily Kleiner here. Here. Frank Ding. Augie Pearson here. Let the record show you have a quorum. Okay. Now you may will you rise for the pledge of allegiance.

I pledge algiance to the flag of the United States of America and to the republic for which it stands. One nation under God indivisible with liberty and justice for all. Thank you. Emily, would you like to lead us in a prayer, please? Sure.

Father, we thank you for this town and the people in it. And we come to you for wisdom, for your guidance, your leading in everything that we do, people who make decisions on behalf of the town and who uh support it every day. We ask for your protection over our first responders, Lord, and a blessing on every family in Jesus name. Amen.

Amen. to this evening's meeting is a little different in what in that our primary uh meeting topic this week is the introduction of the fiscal year 27 budget. So we don't have a consent agenda. We don't have any public presentations or unfinished business. We're going to get right into the new business which is the introduction to fiscal year 27 budget. Mr. Town Administrator, will you please take over?

Yes, sir. So, um the main function or purpose tonight is we're also live streaming. So, if if if people are joining us live, welcome. We appreciate you uh having an interest in uh the town's budget process. and anyone who logs in later on in in the next couple of days, again, we appreciate you having an interest. Um, what my goal here tonight is to basically introduce the budget to everyone. Um, I think it's important to note that the town of Rising Sun's budget in many respects is rather unique in the sense of, and we've talked about this a million times, but having been in a water and sewer moratorum from essentially 2005 until 2019 basically created some really significant um hindrances for the town of Rising Sun. And we've talked about this over the years and we'll continue to talk about it because I think I think it's important especially for folks who tune in to want to learn a little bit more about the town um is to sort of pull back the municipal curtain as I always say and look behind it um to see the the uh the inner workings of it. So having been in the sewer and water moratorum some highlights of that impact I think it's important that we start out by explaining to everyone one of the ways that the town generates money and one of the largest ways we generate money from a general fund standpoint is uh through

real estate tax and real estate tax is derived from the state assess value of your property. So if your property was, you know, assessed at $100,000, which is a low assessment, you would divide that by 100 and then multiply that by 40.46. Meaning that the town of Rising Sun's real estate tax rate is 46 cents for every $100 $100 of value on a property. To put that in perspective, um, of the eight municipalities in Cecil County, um, the town of Rising Sun is in the lower third of real estate tax. to other communities that have a higher real estate tax and we'll get into that a little bit. Um how that really plays out. The the the the devil is in the details on some of that. And so our tax rate is in the lower third and we generate right now about 1.162 million a year of real estate tax. And that real estate tax is what is used to pay for the police department, public works, um the general staff, uh uh pave the roads, cut the grass and the parks. All of the the general things that the town does are um supported financially through the real estate tax rates. back in 2005 when the town of Rising Sun um went into its uh sewer and water moratorum, it took a couple of years for

the negativity of having to go into a sewer and water moratorium. And what I mean is that when you're in a sewer and water moratorum, not only is there not any new development or new construction, but people are less likely to invest in their property, whether it be a residential property or a commercial property. And they're less likely to invest in those properties because the property values um start uh start to decline. And it becomes sort of like a self-fulfilling prophecy that as you're stagnant, so to speak, because there's no new development or investments going on, property values start to decline. And when we start to talk about new investments, those investments don't necessarily have to equate to doing things to your property that uh bring up the value per se as much as just painting and fixing the gutters and the roof and stuff like that. So it it is it's a very negative um quicksand so to speak that the town falls into but it always takes about two or three years for the negativity of an event in our society to trickle down to the local level for it. It it has to go through the federal government and the state uh the state government then down to the counties and then down to the local level. So when something happens, let's say it this way, if something happens good in the economy today that's really significant, it'll take about two years for that positivity and those benefits to come down to the local level. And then conversely, if something negative happens, it'll take about two years for it to trickle down. A good example of

that is we're all familiar with the housing bubble um back in 2008 when the housing bubble in to some degree was caused by a lot of predatory lending and banks were in such a uh a fever pitch to sell homes that they would basically have appraisers that basically were worked for the bank, so to speak, or or got all the business of the bank. And the bank would get those appraisers to go out and instead of the appraiser saying, "Johnny, um, what is the value of this house?" And doing a true assessment value of the house, the bank would say, and let's let's break it down this way. The bank would say, "All right, Mr. Appraiser. I know you appraise the house at $300,000, but we really need to appraise it at a higher level or a lower level so that Johnny can um on paper afford the financing to be able to buy the property." And so what basically happened in leading up to 2008 is that there were a lot of people that were living well beyond their means because they were qualifying for mortgages that they really didn't have the resources or the financial uh dexterity to be able to continue to make those payments. So, there was a huge influx of foreclosures on properties and then those properties sit um when you have a lot of properties going into foreclosure and they're sitting there vacant, it's like anything else in in our uh in

our economy. Supply and demand is very important. So if you oversaturate the housing market with all these houses that have been foreclosed and they're not moving, then that artificially brings down the value of all the houses at the same time. And so just like all of us get the benefit of the equity in our home, if the house was overappraised that you were trying to buy or not appraised properly and you were overleveraged on your mortgage payment and then you wanted to uh either the house got forclosed on or you wanted to sell the property. you couldn't really sell the property for what you had in it because a real appraiser would come in and do the appraisal the way it actually was or should have been. So my my point is we all know what that did to our economy in 2008. We talk about it being the housing b uh bubble and the recession. Well, it took about two years for that negativity to hit communities like the town of Rising Sun. So what I mean by that is in 2010 the total assessed value of all the properties in Rising Sun was $236 million a year. So when you divide that by 100 and then multiply that by the tax rate at that time that yielded the town about $950,000 of real estate tax. Well, by the time we got to 2014, four years later, the same properties that had a value of $236 million dropped all the way down to $176 million. And we saw our real estate tax

go from $900 some odd,000 to only about $760,000. And so you saw a huge reduction in the town's revenue, but yet at the same time the sound the town is obligated to provide certain services. And so just like we all deal with the cost of things going up, it was a a perfect storm there where the amount of money that the town was bringing in was going this way, but the cost associated with providing all the services was going the other way. And so in many respects, I've said this before, it's pretty remarkable that the town was able to, you know, stay afloat during those times. And I always sort of look at it as like an airplane that's sort of going into a crash dive. We were able, you know, a couple years ago to actually pull up and now we're starting to rise again to where today, as of right now, the total assessed value of our properties is now like $250 million and that's yielding us $1.162 million. But if you go back, even though I talk about that all happening in 2014, it wasn't until we got to about 2023 that our assessed value of properties reached what it was in 2010 and the amount of real estate tax that we were collecting in 2010 in proportion matched what we were collecting in 2023. And so it's it's been a long ride. Um so that's that is something that is sort of

been hanging over the town of Rising Sun for many years here. However, we we have pulled through it and we're actually doing very well right now. um we're doing well in the sense of we have a lot of opportunities and a lot of leverage before us to to put the town in an even better position going forward. So what do I mean by that is we all know that it is not uncommon for houses in the town of rising sun to be have offers of sale within a day or two weeks of when the houses go on the market. They are they are flipping very quickly. And there are some people that are coming to the table with large sums of cash. And the reason for that is if you remember what I said about the housing bubble in 2008 and banks and appraisers not really doing that process the right way. One of the changes that was made um in the lending practices is that you essentially the folks who do the appraisals are independent from the banking institution. So the banking institution just has to go out and get somebody to do it. They're not always using the same person all the time. It can rotate. So that's one of the changes that was made. And then also the parameters in which somebody could appraise a property were tightened up. And so that had a lot to do with uh getting our country as a whole out of the housing bubble and the problems we were having in 2008. And so we are making our comeback over the

years. And what we have before us is that the value of our homes are is actually very good. So I'll give you some examples. If you look at the Maple Heights development across from the Legion, some of those houses sold for 260, $270,000 in 2005, 2006. Some of them are now selling for $460, $480,000 here because the the community is a very desirable place to live. The other thing we have going on is, and I always want to be careful about how I say this because I know we're all very proud of our rural heritage here, and we want to continue to be that small town with the small town feel, but we also have to juggle as a society, not necessarily as a town, but as a society, our belief that landowners have rights to be able to do certain things. That's sort of the foundation of our country is um individual rights. And part of those individual rights within reason is to be able to do something with your land. And we have a big influx of folks who want to build in our community. And it's no secret that we have roughly 600 some odd houses that have already been approved for land development or or to be built over the next year, year and a half from now. And the realtors and the developers have told us that they're going to be selling those houses for $500,000. And so what that's going to do is continue to pull up the value of everybody else's home because when

somebody comes in to appraise a property, they not only do an assessment of what they think your house is worth, but they look at houses in the area and other houses similar to yours. So, in the same way that the houses in Maple Heights, some of them are going in the high threes and $400,000 range, all that's doing is bringing up the value of another house in the Maple Heights development to come up too. And so, um, you know, I guess it's sort of that theory, you know, high tide rises all or raises all boats here. And so, we're starting to see that. Now, I I was careful about the way I'm talking about development because we're all very we have a we have an an eye on preserving a lot of the good things about our town. And that's why we've talked about this a lot over the past three years. All the changes that we have made in our zoning and land development codes to basically say, "Yes, we recognize you have the right to develop, but you're going to develop our way. You're not going to develop just the way you want to develop." And we all know that in the early 2000s, this town has been the victim of a lot of bad development here. So, we've cleaned a lot of that up. So my point being is, you know, we have the opportunity here uh with our budget to continue to hold the line and then the town is going to grow, you know, financially and servicewise simply because of the housing that is coming uh to the town down the road. I also want to throw another important point out there from my perspective as a town administrator.

And I've said this a couple times. I can finally see a value in the sewer and water moratorum that the town went into because it forced the town to learn how to operate with basically nothing without cutting significant services. So we've talked about this in the past. the town of Rising Sun out of the other uh incorporated towns, the town of Rising Sun and Elton are the only communities that provide police uh building inspection um um and u and now we're actually doing our own storm water management. And so we're bringing a lot of the services that normally go to the county and we're bringing them back in house so that we can control our destiny a little bit better. And so when you talk about bringing all those services in right off the bat you think well that's more cost and it is more cost but again we're on the lower third of the total real estate tax value. And when you look at the way we structure things in this community, we have the second lowest cost per capita in the entire county. Um there's only one other community that has a lower cost per capita than we do. So we haven't raised taxes in a long time. We continue to figure out a way to make do with what we have. And tonight's budget is going to be year, you know, 20 2027's example of how we're going to get creative to be able to provide um these services. So we on behalf of the elected

body now and in the past there's always been the goal of maintaining the role uh legacy of our community recognizing that there's certain things that by law are allowed to happen such as development but take control of that development. And at the end of the day, and I I've said this many times in the past, as a homeowner, you have a poker chip in life, and you get to cash in that poker chip at certain times during your life. And that poker chip is the value of your home and the equity in your home. And so if your daughter's getting married and you need to pay for the wedding or you want to send your kids off to school or you need to put an addition on your house or other types of things, you can cash in that poker chip being the value of your home to get a home equity loan, financing, whatever. that that value is incredibly impacted by the decisions that are made by your local government, whether you know the raising taxes, uh, not providing services economically. And so, what we have tried to do over the years is to protect that poker chip of every single one of our residents. And I just want to close with something that I brought up last month. a good way to to sort of gauge how your real estate tax that you pay fits in with other other uh people that you might know in other communities. There's a term called the median effective property tax rates. And what that basically means is that based upon

the assessed value of your house, how much of the real estate tax that you're paying is is is uh is how much of you what you are paying is having an impact on the total value of your house. And so to give you an example, if if a property owner in Rising Sun has a house that is assessed at $300,000, their tax bill in the town of Rising Sun would be $2,400. That represents 0.8. So their real estate tax represents.8% of the total value of their home. And when you look at how that is in other geographic areas, Cecil County is 089%. The state is n5% and nationally it's n2%. So we are sitting at 8 and everyone else around us is higher in there. So that's a good barometer of how much real estate tax you're paying compared to the value of your home. That again goes back to protecting the poker chip of people. And I've been saying that for many years. So that's sort of an an overview there. And so as we go to get into the budget itself, there's a couple things that people need to also keep in mind is that when we as individuals experience negative things in the economy, it can be exemplified 10 times over for the town

of Rising Sun. So over the summertime and into the fall and into the winter, everyone was rightfully upset about the cost of electricity and people saying, "Wow, my bill is normally $2, $300. It was $500. It went up." Well, imagine operating a wastewater treatment plant that's operating on threephase power. And when I talk about us, you know, doing more with less, we don't balance our budgets with big surpluses. We're we're not in that position to be able to do that. So, if your electric bill is going up a couple hundred dollars a month, imagine what's happening at our wastewater treatment plant and and things like that. And when we're all struggling with the price of gas the way it is now, multiply that out on the fleet that the town of Rising Sun has. And when you're in a bigger community that has more surplus, those anomalies are not really going to impact you. You can absorb them. When they happen in the town of Rising Sun, it gets our attention. And so that's that's one of the things you're going to see in this budget. So, I want to change it up a little bit from the way I've done it in the past. I usually start with the general fund. I'd like to start with the um water fund itself. And let me move this over to the screen. So when we talk about the type of funds that the town uses to provide the services at the top of that pyramid there are two descriptions that you need to understand. One is general funds and

then the other one is proprietary funds. And proprietary funds are essentially when you declare that you're going to charge a specific service charge for a specific type of service. Now the definition applies here for water and sewer. And so in the town of Rising Sun, 99% of our property owners are on our town water system. But you can go to some communities where not all of those residents are on the local water or sewer system. And so it would not be fair to have the general fund real estate tax of someone who's on a well or septic to have their real estate tax being paid for the water and sewer service that somebody down the street is getting. And so you charge a service charge for the water and sewer for the folks that are getting the water and sewer. And that is basically called a proprietary fund. So the town of rising sun has two funding mechanisms. One is the general funds and then the other one is proprietary and then proprietary is broken down into two distinct categories of water fund and sewer fund. And so in looking at the water fund, you can see here, I'll highlight one. I'm going to go for the board's benefit. It's line 637. I'm looking at public utility billing.

On the screen, huh? on the screen.

Oh, we're not we're not showing up on screens. So, we just have to walk through it. It's It's not showing up on screens. I don't want to u delay. I'll keep moving here. Um so on the water side you can see where in fiscal year 25 which is the um the first column of numbers in it. We brought in $998,265 of water. We for last year's budget, we estimated that we would bring in 1,153,734. Right now, year to date, we brought in 960,423.88. And if you project that out over the remaining u three months, we will have collected 1,280,565.17. So we've gotten pretty good here at projecting those numbers and trying to anticipate what's going on. And so next year we are projecting for the 2027 budget we're projecting 1,321,311. Now, that reflects the annual 5% increase that we have to put on the water and sewer funds. And it also

includes an expectation of 50 homes being built between now and June of 2027 is what basically what that comes down to. All those land developments developers are in their final stages of approval. They keep talking about they're going to be putting a shovel in the ground any day now. We do expect things to start to happen maybe around July, August, and then there's a chance they're going to build and sell 50 houses in the community. Um, so that number includes that. The other number that that is also included in that is a 5% increase. And I think it's very important to remind the residents the importance of the annual 5% increase. When the town of Rising Sun was incurring all of its legal issues back in the early 2000s with the Mau department of the environment having a failing wastewater treatment system and not enough water to supply to our residents that the problem was the town of Rising Sun over a long period of time never adjusted their sewer and water rates and so they never accumulated any money in reserve to pay for any of the infrastructure repairs that would need to be done. And so I've talked about this a lot in the past. You know, depending upon what financial person you talk to, some people believe that you should have six months of operating funds in reserve. Maybe even in your own household, it's a good idea to have six months of your mortgage payment, your rent payment, your car payment in reserve so that you can withstand the loss of a job or a disability or

something like that. So when you talk about what you should have in reserve, the town of Rising Sun had none of that. And that meant that when the state government came in and said, "You have to build a new wastewater treatment plant for $16 million, and you have to come in and fix your water at a cost of $10 million for a total of $26 million. The town had no reserve funds in order to do that. So that required the town to go out and get loans. And the best loans that we could get were from the United States Department of Agriculture, USDA, and were able to get 40year loans. But as you're going to see in these water and sewer funds, that debt service takes up a huge portion of what it costs for us to um for us to pay for those loans. The point I'm getting at is that even today with the rates where we have them, the rates are there not because we're making money. The rates are there because that's how we're paying our mortgage basically on on the sewer and water. And so we're not even putting away enough rainy day funds to offset things. And so that again is why the development has a positive impact on the community in terms of being able to collect additional revenues to put the town in a more sustainable position in the very near future. So, I read all those columns out for you because I wanted you to see how the document is structured that you have what was spent in 2025, what was budgeted uh in 2026, where we're at year to date, where we

think we're going to be, and then how we're going to do our budget. So, I wanted to show you um the revenue stream coming in when we get down to the expense side and our total revenue is 1,447,346. But when you go over here to USDA um loan interest, we're paying on the water side, we're paying $95,770 a year on the interest on the loan. And the principal payments on the loan are $174,394. And that's just those loans. We have other loans related to the water side that we're still paying off. So within our water fund, we have a lot of stuff that's just the cost of doing business. you know, fixing water lines, uh, getting our public works people the equipment they need to be able to fix the water lines, skid steers, backos, dump trucks, pickup trucks, um, lawnmowers to, you know, cut grass, all that stuff is built into there. And so when you scroll all the way down to the bottom, our projected expense is $1,98,000 and our budget and I think we have a math.

No, you have to take out your depreciation.

Yes, that's right. um our expense is 1,98,000 but in in government accounting standards when you are um doing your auditing and your financial reports on your proprietary funds you have to show depreciation of your um of your of your um infrastructure. in uh things that you own. So when you look here, we have a depreciation that we have to show on our financials of $538,995. That is not a cash item. meeting when we do our budget a little bit different than what maybe some other finance people would do in bigger organizations because our margins are so tight. We pretty much do a cash in cash out budget, but we're still required to show the depreciation in there. So, even though I'm saying that our total expense is listed at $1,98,992, when you roll the depreciation out of that, it drops the expense down to 1,369,997.11. So when you're looking at it from cash in cash out, we have a hypothetical surplus of $77,3489. Now let me uh give you the commissioners a little bit of insight in here also that that money is already spoken for, if it makes sense. because for many many

years the water and sewer funds were not able to pay back the general fund for what the general fund paid for. So the easiest way to describe that is when you're doing payroll for your employees. You don't want to be handing them three different paychecks. One for the general fund, one for the water fund, one for the sewer fund. You give them one paycheck that comes out of the general fund. You track what the water would have to pay in salaries, but the general fund has typically been frontloading that. And over the years, the water and sewer fund have owed the general fund at many different times hundreds of thousands of dollars, which messes up your books to some degree when you go to do auditing because you have all these monies that are owed to the other funds. Judy and her staff have done a great job of finding the avenues in here to be able to pay the general fund back. So, the water fund used to have a very high balance due to the general fund. We've gotten that down to $21,000 now, but over the next three months, it'll grow a little bit again and it'll probably be up to around $60,000. So when I talk about the $77,000 surplus, okay, that at some point in time has to be used to pay back the general fund to make it whole.

So the bottom line is we have a net positive gain in the water fund of 77,348 uh89. on the sewer side. Our expected revenue on the sewer side is, and I'm looking for your benefits of um right, it would be um right between row 729 and 730. The expected revenue is 1,443,35. If you go up to row 725 and you look at the sewer uh billing in 2025, we actually received $936,000. We budgeted 1,122,437 to to come in this fiscal year. you to date, we're at 935, $999.90, and that tracks to bring in 1,123,199.88 by June 30th. So, we pretty much have exceeded what our revenue projection was. And so then when you slide over more and start looking at what we're budgeting for for next year, we're budgeting $1,178,890. It's only a roughly 50 some odd,000 increase. That increase is bored out of the 5% increase in in the sewer rate and it also projects 50 new homes being built

and then paying into the system also. So you can see the numbers are conservative and I think that's why we're successful in matching our budget projections because we try to be very conservative because of the margins are so tight. So when you get down to the expense side, if you go to row740, you will see that we are paying $245,532 in interest to USDA for the water line. And then we are also paying $270,932 to USDA for the principal payments. So we're just over $500,000 on a $1.4 million revenue. So right off the bat, that shows you how much debt um the town is paying in those areas. Um going down through the budget, we have again the same miscellaneous things that we cover, some basic equipment upgrades. Um we are starting to invest in some equipment replacement at the wastewater treatment plant. Um, we are looking to purchase some redundant pumps and uh blowers and stuff like that so that when something goes down, we have something on the show. So, when we talk about rainy day funds, you can also equate that to sort of like a rainy a rainy day thought process on your equipment. So again, even though we've been holding the line, we're still finding ways to put backup equipment on the shelves at the same time so we don't have an issue.

So when you scroll down through there, you can see on row 762, our electric bill for the sewer plant is $80,26418 is what we're paying for the sewer. Um, another thing that I wanted to bring to your attention, if you look at line 774, it's called merchant charges credit card fees, and you'll see that we have $12,000 allocated for that. And when you go up to the water, I'm not going to try to find it, but I believe Judy, that's another 18,000 or 60.

Total of 30,000.

Yeah. So um what I'm highlighting to you is that remember what I was talking about this elected body and other elected bodies take very seriously preserving the poker chip of our residents. Well that is essentially what it cost the town to allow people to have the ease of paying their utility bills by credit card. meaning we at one time used to pass that sir charge on to the resident but here's the way we thought of it and Judy came up with the idea that okay we could collect that $30,000 which means it's coming out of the pocket of our residents but at that time we were not even getting $30,000 because we didn't have that many people using their credit cards cards. And so what Judy's thought process was, if we had more people logging in online and paying by credit card, that's less checks that were opening up in the mail. It's less people coming to the window. It allows us to direct the the activities of our staff to other things instead of dealing with that. So there's a staff efficiency that we get a benefit from if people use their credit card. And so in order to make it more attractive, we decided to trade off that $30,000 of charge to the resident and say that we're getting a better a better gain on more efficiency from our staff while also making it a little bit more palatable for residents to be able to pay their utility bill at

a timely manner. So, I just wanted to show where um the town is picking up that that expense. And as we all know as shoppers, very often when you go out to use your credit card, in many instances you pay a fee for doing that, especially when you pay for online services uh that that you're that you're paying for. So you scroll down and our total expense for the sewer is 2,182,348. But again, depreciation is a noncash item, but it's an expense. And that's $740,000. So when you roll that out of the number, our expense drops to 1,442,348. And woohoo, we've got a $686 to the positive at the end of the year. So again, that's another example of where I say we're holding it together. We're not raising taxes. We're holding the lines on things, but we are we are being very efficient in how we're trying to manage our money in the sense that we can balance a budget with a $686 um surplus. Now there are for transparency there are items that we always put in the budget that if things work out we will want to do that but we transfer some money from rainy day funds to cover that. So, in the sewer fund, you will see some transfers of money in there to offset some of the bigger projects that

we might have to do. Now, I'm also going to say Judy and I are going to spend a lot more time between now and our next budget meeting because we want to really get in here and look at some of the expenses that have gone up and try to figure out why they have gone up so significantly. for the board's benefit. I also want to draw your attention to line 779 on your it's on the sewer thing uh sewer uh accounting and it's titled utility system testing and sampling. And you will see where we budgeted $29,32 um last year, but we're on pace to spend $70,000 and our third party consultant has told us to project $92,315. That is borne out of the fact that and I I always like using these words. I'm always telling people I'm about to segue. Hold on. There's a reason why I'm segueing. You've heard me talk in the past about we have applied for grant monies to try to get very creative in offsetting some of our costs. And when the wastewater treatment plant was originally built back and approved back in 2012, the town did not have the money to decommission the lagoon. It was like $1.5 million to decommission the lagoon. And so when you talk about the sticker shock of the sewer rates being where they had to be raised at that time and where they're at now, imagine if we had

to come up with another $1.5 million to decommission the lagoon. But on top of that, we would have had to do uh more we would have had to build more things in the wastewater treatment plant because when you treat your waste water, you are separating the solids and the liquids. And our wastewater treatment plant, it it separates the solids and the liquids. But unlike other wastewater treatment plants where the solids go through another process where they're ran through a press and all the moisture is is uh squeezed out of it and then it goes into a truck and it's either hauled away to a landfill or in some cases it can be uh uh applied to a farmer's field in there. Um we don't have that. Our sludge goes right into our 10acre lagoon. And the theory behind that back in 2012 was that there is people don't people don't necessarily might not realize this, but the beauty behind treating wastewater is not chemicals. It's not like in your pool where you put chlorine in it and you clean the water. That's not what wastewater treatment is about. Wastewater treatment is basically about holding stuff in a suspended state, mixing it up, putting oxygen in it because there are natural uh organisms that actually consume the sludge and eat all the negative stuff that's out of it and actually to some degree treat the water. So it's a very interesting natural biological process in treating sewage. So when it was

determined that we could put the sludge into the lagoon, it was if you imagine putting a lot of sludge in there and piling up at the same time the natural organ organisms are actually consuming the sludge. So the sludge is increasing in the lagoon but not as much as you might think. However, we can't continue to operate that that lagoon that way. It's not a very good system and we are bearing the consequences of it now because we have that sludge in the lagoon. And in addition to that, we have found out shortly after the lagoon was open that there's an underground spring that's feeding into the lagoon. And when we talk about why the lagoon might have been failing back in the day is that I don't think anybody realized that there was an underground spring putting a lot of water into the lagoon. And when I talk about wastewater is about to some degree suspending things for a period of time, a lagoon is even more a bare basic system where the sewage just comes in on one end of the lagoon. It goes through some baffles. It just flows at its leisurely old pace around. And if it, let's just say that hypothetically, a good operating lagoon would hold one water molecule for 50 days in in the system before it went out the other side, giving the natural process the ability to treat that molecule of water. When you have an underground spring coming in there, that 52 days might have been reduced to 10 days, 15 days, 20 days because now the lagoon that was

designed for a certain amount of wastewater flow coming into it had an underground spring. So I do believe that part of our treatment violations were because of the underground spring. And nobody realized that until we built the brand new wastewater treatment plant and had to block off the lagoon so it didn't flow into the stream. Well, within about 10 days, a lagoon was ready to overflow. And it was because of the underground spring. And so that means that on a regular basis, we have to pump a large volume of that really nasty water in the lagoon back up into our wastewater treatment plant. Now, here's another segue because I'm about to tell you that it is creating a an issue from a laboratory testing standpoint and that one of our tests we are we have been failing recently and it's basically a byproduct of all that nasty stuff in the lagoon which is developing algae and fungi is being pumped back into the into the wastewater treatment plant and it wasn't really designed to be able to to treat that. So, we have instances where we are putting it out into the stream and we're struggling with our test as a result. And so, when that came to our attention, we've had to double and triple up on the amount of uh testing that we're doing. So, I just wanted to explain to you with all of that why we're going from $29,000 to $92,000. Now, I talked about all the grants that we're applying for the decommission the lagoon. That is the answer to the issue

is to decommission the lagoon, get a a a belt filter press, get that out of our hair. The beauty of it is instead of us going to the resident for the three three and a half million dollars to do that, which is what it would have been years ago, we now got uh we're basically um in the final hurdle of getting money from FEMA to pay for that whole decommissioning of the lagoon, building a new belt filter press. And the other thing that we're getting funding for is the MS4. And I've talked about that at Nauseium in the past. It's an unfunded mandate from the EPA down to the state that we have to reduce our nutrient footprint of things that get into the waterways and affect the aquatic life. And we figured out a way and said, "Hey, if we decommission the lagoon, we solve the issue of not having to have the sludge go in there. We solve the issue of it affecting our treatment quality. And at the same time, we can solve our MS4 requirement by redoing the stream that runs next to the lagoon and turning that all into a wetlands buffer. So, what I'm saying to you is this grant is for about $5.5 million and the federal government is going to pay for us to solve all these issues that I've just been explaining um to you. Now, if you remember, I did an NPR uh interview at the beginning of 2025 because we were supposed to get the money, but when the new administration came in, they suspended the FEMA money for these purposes. Well, we received

notice about two months ago that the funding is being restored. We don't have to do anything. It's just the federal government checking the final boxes. Now, I do know that maybe the federal government funds one of our projects and not both of our projects. So, fingers crossed that will be paid for. But we're not sitting flatfooted because the other thing we did is we applied for a grant from MDE to do the exact very same thing. And then the other thing we've done which I want to do another segue of the importance of building relationships with people in higher powers of office regardless of their party affiliation to be quite blunt because they hold all the money. And we have gotten over a million dollars of grant money that we'll get into in the general fund to do things in our downtown area. But we have also lobbyied our sta uh state or our federal senators to put what is called earmarked funding in the appropriations bill for the federal government. So we've applied for the same amount of money to do the wastewater treatment plant. So hopefully one of them which we think the brick funding will come through but if not cobbled together with all the other three we're trying to hedge our bet to be able to offset this significant uh financial cost and all the segways I've been giving you on how it impacts us. I want to double back and make sure I make an important point. Our wastewater treatment plant is treating above and

beyond what is required. What I'm saying to you is the system was designed to do a certain thing. It is exceeding that and MDE is giving us a grant every year for about $34,000. And you get that if you treat above and beyond the quality. this anomaly that I'm talking about with the fungi that believe it or not is a totally separate issue and does not affect our grant. So I want to let people know that other than this anomaly that we're dealing with because of the way we had to do the lagoon back in the day, the sewer plant is doing its job and it's doing it very well. So down to the bottom, when you look at the proprietary fund, both sewer and water were in the positive of $78,35.81. Does anybody have any questions on the proprietary funds? All right. So, we can jump into the general fund here. And what I'm going to do is I'm going to take you all the way down to the bottom because it's always about the bottom line. And at the bottom of the document here, um, you see that the general funds revenue is 3,581,382 and our expenses are $3,575,451 for a surplus of $5,93100. I

I need to apologize to them. I see they're looking for that. That in printing did not open the cell wide enough to print that number and I apologize for that. Okay. I didn't catch that.

Okay. So, that's what we're in the positive there. I want to drive home the point of again if you looked at our expenses in the general fund of $3,575,000 a good business plan would have six months or more of that in reserve. We don't have that and we're already balancing the budget with a $5900 surplus. And anyone who has tracked our budgets over the last 10 or 15 years, I think maybe the highest we ever had was a $16,000 surplus at one point. We're always within those margins, but we keep the lights on and we keep the services flowing at the same time. But again, the glass is half filled. It's not half empty because we have all this new investment that is looking to come in to the community. And at the end of the day, all of this is a benefit to our residents because it keeps the value in their homes. It keeps more money in their pocket. And um that that's what our goal is to do. We're a conservative community and we we continue to try to operate that way. So, let's look at some of the salience items here. Um, I'm not going to go through all the line items, but I want to point out a couple things that, um, we are sort of relatively new expenses that we have to account for. And we have a barebones budget. Let me first double back and talk to you about staffing. Um the budget has the hiring of one additional

police officer. In talking to the police chief because our margins are so tight, we normally are trying to hire two police officers. We he has felt that because it's so difficult to get them that we be conservative and just look to hire one police officer. The other thing this budget includes is that we need a little bit more staffing help on the administrative side and a little bit more on the police side from a clerk. So, we're going to share a clerk's position between general admin and the police department. So, that's a new position in our public works department. We have a vacancy. were looking to fill that position. And Judy, refresh my memory. Did we have an additional hire on top of that?

No.

Yeah. So again, to be conservative in the budget, we're going to try to get back up to our normal operating level of four and forgo trying to go to the fifth one like we've always tried to do in the past. Again, this is all born out of us waiting for these other revenue streams to start to come in. Um, that also includes hiring one code officer here also. So, we have a a code officer which we've been carrying in the budget for the last couple of years, but we've not flipped the switch on hiring it because we're also watching what the development community is doing. So I do anticipate um the development is going to kick off around you know July and so we are looking to hire that code officer at that time. The other item that is in our budget is that 20 years ago a website was the center of a community's um operations. It's where people got their news from. They could log in and they could get data. They could figure out the codes. They could look at town meetings. They could see the calendar. Um, we could potentially put up communication, but it was very, very stagnant. And I've been doing this long enough that when I came to the town of Rising Sun, the town had two pages on its website. It was about as stagnant as it could possibly be. And then we moved to a more robust website that had what you would call a page within a page within a page where you would click and go deeper and deeper to get your

information. But 20 years ago, those website companies would say, "Oh, you have some financial accounts payable we you have to do. Well, we can do that model for you." And another one would say, "Oh, you have building permits that you want to track attract. We can do that. You do utility billing." And you had these very, very robust websites that were overextending themselves where they really didn't do accounts payable very good and they really didn't do building permits very good and they really didn't do utility billing very good. and they really didn't do asset management very very good because you're talking about hiring, you know, uh, a Swiss Army knife to be able to from an IT standpoint be able to work all that out. So what happened especially over the last five to 10 years is a lot of different websitebased companies that are coming out and they're specializing in specific things like your like your bills payable and your utility billing and your uh building permits and your asset management. And so what was a $50,000 expenditure back in 2008 to bring in the town's website has now morphed out where over the years we paid 20 $30,000 for a building permit software program, 20 $30,000 for utility billing, 20 $30,000 for um accounts payable. And the difference is they're now housed in the clouds and so you to some degree cut down on having to replace your servers and stuff like

that. So there's been a lot of growth in there. What I'm getting at is our website company has announced that they're getting out of the business of websites. So remember what I talked about these website companies taking on too much responsibility? Well, they would rather do the merchant billing and they'd rather host sites where people can, you know, go to buy something and the company you buy it from sends you to a hosting site that would be the company that is now doing our website. So, they've been in business for like 25, 30 years, but they've decided they no longer want to do that. So, we have to go get a new website. So when I talked about the website being the center of the universe, you know, 20 25 years ago, do we really want to go out and spend 30, 40, $50,000 on a very robust website? When when you really start to think about our website use now, we don't communicate with residents on our website. We use several different social media platforms. There aren't a whole lot of people coming to our website to, you know, find out that we're flushing hydrants. We're doing that on our social media sites. So, that's a very important function of the website design that's no longer needed. We're doing uh utility billing separately, building permits separately, accounts payable separately. And what I'm coming to the conclusion is that our website is becoming nothing more than a place to see a calendar when the meetings are going to be to be able to look at news and notices and breaking news. But again, breaking news, we do

that on social media. It is becoming a repository for all of our town records and documents and ordinances and codes. And Wanita can tell you so many times people go on our website and they get frustrated because they can't find the code because it's a page within a page within a page within a page and you're clicking and clicking and clicking. And today's society, we're all impatient. We all want to get it in real time. And so we've been talking to some vendors about doing a website that is more of a a calendar of events. Um a repository of all your codes and ordinances and meeting minutes and all the documents that you have to keep there. and then maybe profiles of elected officials and maybe repost because legally when it comes to RFPs there's still a certain way you have to post those things so they can be on there. Why not create a chat box in the middle that instead of somebody going to our website saying I want to put a shed in my yard. I wonder what I need to do. Some people will call when need and ask for that. Other people want to go on the website and they get frustrated because they can't find it. So if you had a chat box in the middle of it that only referenced our data when you talk about chat GPT and AI, a lot of people have concerns because it can get its information from Wikipedia and unreliable sources. You can create your chat box to only get its information from what you give it. So it would basically look behind the municipal curtain and go in. And so imagine all of

our codes and ordinances and meeting minutes and meeting videos being in this room in boxes. And instead of a resident having to come in and be click on a thing to go to the box to get it, they would go into a chat box and within 30 seconds or less, it would give them all the information they need on how to put a shed in their yard and even include a link to go to our permit software program to be able to actually get the application. So the point in all that is that we have the ability and it's what we're researching and getting a new website and not spending a whole lot of money on a whole lot. It's more user friendly and may have an AI type component. So, the way I'm sort of joking is that we're trying to be somewhere between GoDaddy.com, build your own website, and the bells and whistles $50,000 website. We're trying to find that happy medium. And so, that's a new expense in here that we have. Um, we're also doing the same thing for our permit software program. our permit software program has not worked out the way we wanted it to. Um, we get a lot of resident complaints about it. It's not the most userfriendly system. And so we're going to get a new software program that actually has an AI feature built into it. And so what that means is when somebody applies for a building permit, the AI can look at the application based upon the information we tell it to look for and it can tell the person you can't submit your application because you need additional information. And then conversely, when it comes to us, it can already go

through a search and say this doesn't meet code requirement. So that when the code officer goes to look at it, it can give an itemized list already that says you need more detail or it's not meeting code requirements. What which is what a code officer does when somebody submits a building permit. We mark up the plan saying, you know, your sterilizers are 9 in. They can't be any more than seven and 3/4 in. You don't tell them to redo everything over again. You just mark the plan up to tell them you have to do it this way. AI would be able to do that. So, that's an additional expense. And I'm sorry that I can't show you this because our monitors are not working right here. Is that we also came across a company called See My Legacy and it is a company that creates a community engagement platform. So let's take a look at what that looks like. So we have Winterfest and in the past we've had signups for carriage rides. In the past, we've gone around and tried to get people to donate to help support because you're going to see in the budget, some of these activities cost the town upwards of 30 50 some odd thousand dollars to do these events. I want to segue for a second. When I talk about where we were financially back in 2014, 16, 18, 20, whatever, we were not doing these types of events. But yet, we've managed to figure out a way to make a 30, 40, $50,000 investment in our community that makes our residents feel good about being in the community without having to

raise real estate tax. So, I just wanted to segue into that. The other thing we're always looking to do is to get volunteers to be able to do that do that. So, this community community engagement platform has a way of people being able to access information on our Winterfest and they could go in on their desktop, their cell phone, and they could register for the carriage rides and they would be given an electronic ticket. And I'm going to give the example of anyone who's ever bought tickets to the Orioles. You might be using the MLB app and you buy it on MLB.com and they send you an electronic copy to your uh a QR code to your phone and when you go through the tone style, you scan it and that's how you get in. You don't have a paper ticket. So this platform gives us the ability to start doing things like that. Here's one for people to consider. The town again in trying to give benefit to our taxpaying residents has a dumpster day and we pay to have the dumpster. I'm just raising the question. Is it fair that anybody in and around Cecil County can come and dump in that dumpster on dumpster day, but they're not a taxpaying resident of the town of Rising Sun, so they're not even paying towards the one or two dumpsters. And I know it's not a lot of money, but in a situation like this, this application would give us the ability to advertise for the dumpster day, ask people to register. it would register. We'd be able to see that they're a town resident and they would show up at dumpster day with their QR code saying I'm a town

resident and they don't pay the dump. And if it's a if it's someone who doesn't live in the town and they still want to dump, they would pay a $10 fee or whatever. And so there's all kinds of different programs, whether it's uh uh Winterfest, Spooktacular, Sunfest, the tractor parade, a variety of ways that we can get people registered for these events, charge vendors that way. Right now, it's a logistic nightmare for people to call when needed and say, "Hey, I want a vendor's table." and the chamber goes through the same thing for Sunfest. And there's a lot of paper going back and forth. They could go through this app, see what vendor spots are available, click a button, pay their fee, and they've got a QR code to show up at that day and say, "This is my vendor spot." So, it streamlines it all. But we can also grow it in to other activities. We can offer more activities. And they don't all have to be driven around raising money. For instance, a couple years ago, Auggie, you might be the only one who remembers this. When we did Triangle Park,

the dog park, and Travis and I laugh about it all the time, there was a stork, a crane that was always hanging out down there. Well, we had an event called Name the Crane and we had kids presenting colored drawings of the crane in the in the store down there. Well, Travis and I went down there like the day before we were going to announce the winner and the darn thing was dead floating in the water.

So, our whole fundraising, it's just a funny story to what had happened. But I say that because this company showed us other communities that um one was up in the northern regions that at certain times during the year a lot of peligans would migrate to the area. So, the community did a show us a photo of Pelans and it gave people the ability to go in on a platform and share their photos and have a a sense of community. And so, there's a variety of ways that we can get residents to be able to engage with each other in a fun and informative way. So, that's going to cost us, off the top of my head, I think it's like $2,900 a year for that. So, we've gone ahead and put that in the budget. Emily,

2,900 or 20

$2,900 a year. So, it's really pretty economical when you think about we can uh there are certain charges that we could charge for. We can create other opportunities for people to get involved. charge a nominal fee because at the end of the day there's an expense to the town at large. It can more than pay for itself over a period of time of organizing that volunteers can register the volunteer. So that's an example of um something that we we also have in our budget there. Um, in terms of vehicles, we do have in our budget, um, we need to replace one of our dump trucks at the wastewater at the public works. And you talk about the ungodly cost of things going up. This thing is going to cost us $135,000. And that's on a state bean contract just to get that size dump truck with a salt spreader on it. So that's a $95,000 expense. But under our debt service, remember we created that debt service. We have room in there to finance that over a seven or 10 year period. And the $135,000 will result in a $34,000 annual payment to pay that off. So that's another thing that Auggie remembers. You know, when we were rebuilding the town back in ' 07 and ' 08, we said, "Why are we cash rolling, bank rolling all of these vehicles, when you can finance them over a 10-year period, you can buy more vehicles, you can outfit your your department, and you're not riding around in an old rush bucket because you can't come up with $135,000

to replace it. So, we have a new public works vehicle in there. The other thing that we are budgeting for and this is more in the water fund. I should have brought it up in the water fund is to repaint the water tower. We all know the water tower is really starting to show its age. But in addition to that, there are other things that we it makes sense for us to do. It's not always necessarily a regulatory requirement, but it just makes sense for us to do it. And so there are different annual maintenance things that we can do with that water tower to spread it out. So we're negotiating with uh one or two companies here for about a cost of $60,000 a year over the next 15 years. We can get a sizable chunk. I think it's going to end up being about $600,000 to go towards repainting the outside of the water tower, which right now is sitting at about $130,000 if we wanted to just go paint it right now. And then if we were to go on the inside and sanitize that and clean it and repaint that on the inside, that's $370,000. So, we would be looking at an out-ofpocket expense of every bit of $500,000 where we could go into this 15-year plan and pay about 600 $650,000 and get all that stuff done now and finance it over a period of time. So, that's reflected in the water.

Kevin, I think you ought to explain the purpose of the the water tower. Okay. Even though we have a water supply coming in from Chester water. Yes. The reason we explain the reason why we we kept the water tower and also the fact that the water tower does generate some revenue from its antennas.

Yes. From their cell phone towers. So the reason why you have a water tower, one of the primary reasons why is imagine, you know, a 10-in pipe coming into the community and the pipe or a 10-in pipe coming from the wells because that's what we used to have before we went to Chester Waters. We had wells. If you had a pipe coming from the well rupture, well then your residents don't have any water. And so the water tower is supposed to give you a day to two days of supply in reserve so that if you have a problem with your water system that you have water available. So that's one of the primary reasons for it. The other and getting in the weeds for it is that water doesn't stay drinkable for long periods of time. So back in the day you used to put chlorine in it. Now they switch from chlorine to what is called chloromines. and water has about a seven to 10 day shelf life in when the chloromines dissolve and now you have the risk of getting water that's contaminated in it. So by having a water tower with a mixer in it, you can mix that up and if need be, you can even inject additional chloromines into the system. We don't need to do that right now because our water runs through the system within that 7 to 10 day period. So that's the reason for the water tower. And as you suggested, we also lease space off the water tower to a uh

cellular company. To give you a point of reference on that, I've never been a big fan of the lease agreement that the sign the town signed 25 years ago. I don't think it favored the town at all. We're in the process of redoing that lease agreement to bring a lot more revenue into the town than what they're doing. I'll give you an example of that. It is not a and And I'm not I don't want to say we're unique, but it's not uncommon for cell tower companies to come in and say, "We want to lease space off your water tower, and we're going to increase your revenue 5%." But they do the 5% increase every five years. So, you're really only getting a 1% increase in your revenue. That's not reasonable and most communities are going back to that has to be an annual increase here. So, we're in the process of pushing back on the carrier there to say no, we're going to do a new lease agreement. The other thing the carriers have a habit of doing is when you look, and I can't remember some of the names, but when you see some of the commercials on TV of the really cheap cell phone companies, it's because they lease space off the major cell phone carriers. And the cell phone carriers carry all the overhead of the towers and everything. and they just charge like a rent space to the cheaper uh carriers. Well, the cell tower company is making money on our property by selling those spaces out to others.

So, we are saying that's not going to happen any longer that we get a cut of that. And the other thing that cell tower companies try to do and this gives us a tool in the tool shed is they have the idea that they own all the real estate of the water tower. And when you drive by some communities and you see several different towers on it, it's because there's enough real estate up there to lease it out to other multiple entities. And so we're working through our lease agreement that says you're going to get a piece of pie and you operate within that piece of pie. We own the rest of the pie and we'll do what we want with it leasewise. So um that's sort of the the highlevel items in there. We have all of our standard expenses are in there. The reason why our when I say our standard expenses are in there, a quick segue, we're not raising real estate tax. We actually only saw about a 30 $35,000 increase in real estate tax because of values are going up. And when you talk about the cost of inflation, you know, in the past it's been 8%, 5%, whatever, that inflationary cost comes down to us. So even though we're maintaining our services, our margins are still tight because our revenue coming in has to offset the cost of living in the inflationary cost. So we're holding the line, but we're bringing new things in. We're fighting with cell tower people to get more revenue. Things like that are what are

what we are doing. So again, the general fund budget is balanced with a surplus of five 5931 5,931. the next time we meet with you, some of these numbers are going to change because Judy and I are going to dig down a little deeper in this. So, I appreciate the patience of everybody. If anyone is is is online live streaming or will be tuning in. I hope you can appreciate we wanted to do more than just slap a piece of paper out here and say that's what the numbers are. We wanted to give everyone a look behind the municipal curtain, as I always like to say, in what really goes into making a budget. Are there any uh questions I can answer of the board?

I don't have any. No, me either. Okay. Are there any things that you think that maybe we have missed that you think that you would like us initiatives to to go after? Well, I think if you give us a chance to really Yeah. sit down and look at the budget. You know, right now we're in somewhat of a time constraint. We don't want to spread this out over hours going through it, right? I I've made some notes. I know Emily's made some notes. And I think what we'll do is probably get those note get those ideas back to you. Yeah.

So that you can look at them. Um, and then when we come to our I would hate to think that we'd have to have another preliminary, but if we're if necessary, we would come back and have a meeting where everything could be explained a little further or right into detail. Um, but outside of that, I I don't want to hold us up much longer trying to figure out well, you know, I see this, she sees this, you know, we we'll be able to talk. Um, so from a scheduling standpoint, I don't think we I don't think we need a meeting in May, you know, anymore in May because you and I are just going to be crunching numbers. No,

we can come back at the the meeting, the regularly scheduled meeting in June. The budget doesn't have to be adopted until June 30th. So, we can always throw in another meeting at the end. And we've done that in the past. We've thrown in a budget meeting by time. you'll have our our ideas what we're we're wondering about or uh or have any other thoughts on. So, yeah, if you could get us stuff in the next week or two because the numbers are so close.

Oh, yeah. that's um you know we're going to be squeezing and squeezing and if we could get any new revenue initiatives that you would like to do and I'm sorry Emily I started to say this community engagement platform would be great for that event that you are talking about wanting to introduce next year okay uh going on there's no staff reports y uh no mayor's report because the mayor's not here. Uh, Commissioner comments. Uh, Commissioner Kleiner. I don't have a report this week actually. Thank you. I don't have anything to add tonight.

Commissioner Pierce, if I could just add, um, I was remiss. And Judy, is there anything you wanted to add? Anything we were doing? Not really. No. Okay. I think you covered it really well.

Okay. Uh, going on the board of zoning appeals and planning commission schedule. Uh basically it's every first and third Monday of the month uh unless a holiday or a special meeting and with the board of zoning appeals scheduled as needed. Upcoming town events Sunfest June 6th and our own America 250 parade June 27th. Upcoming holidays were town hall will be closed Memorial Day Monday May 25th and Junth, Friday, June 19th. Uh yard waste is collected on Tuesday. Uh no, yard waste is collected on Monday. I'm sorry. Trash is on Thursday. Recycling is on Tuesday. Uh unless some unless you or I have anything else. Commissioner, I would just say we are having our regularly scheduled town meeting.

That was the next thing that was about we are going to have a town meeting on Tuesday. Yes. Where the agenda will be dealing with new business going back to the regular format that we would normally use. Um, you have anything, ma'am? No, I don't. I the meeting's adjourned. We don't even have to take a vote because it's just the two of us. Y thank