Finance Committee - Regular Meeting

Okay.

Good evening everyone. Welcome to Budget Engagement Commission. I like to call this meeting to order. Would city staff in person please introduce themselves?

Good evening. Mike Futrell, city manager for the city of Riverside.

Good evening. Sean Murphy, deputy city attorney with the city attorney's office.

Sergio Aguilar, deputy finance director.

Elizabeth Martinez, finance department.

Peter Kakos, Interim Budget Manager.

Ruby Castillo from the City Manager's Office. Michelle Davis, Housing and Human Services Director. Good evening, Miranda Evans, Interim Community and Economic Development Director.

Good evening, Colleen Torres, Deputy HR Director. Hi, Chris Martinez, Assistant City Manager.

George Khalil, your chief innovation officer.

Lee Withers, general services director.

Nathan Mustafa, interim public works director.

Joe Viera, deputy director of general services.

Christina Klabaugh, deputy director for marketing communications. Erin Christmas, library director.

Caitlin Ryerson, director of marketing communications. Jessica Herdina, assistant library director.

Hector Villegas, administrative services manager, city attorney's office.

Mike Allen, deputy fire chief.

Brian Gazetta, deputy fire chief. Good

evening, Gil Hernandez, interim assistant city manager.

Good evening, David Garcia, public utilities general manager.

Steve McKenster, fire chief, good evening.

Hello, Mike Avila, admin services manager, finance

or fire, sorry.

Good evening. Brandy Becker, Riverside Police Department.

Good evening. Bobby Hilo, Public Works Fiscal Manager.

Thank you all so much for that. Would you all please join me in saying the pledge of allegiance? I pledge allegiance to the flag of

The United States Of America and to the republic for which stands one nation under God indivisible with liberty and

Okay. My dress is stuck. May we have

the inclusion statement read, please?

Pursuant to the city council rules of procedure in order of business resolution, the members of all boards and commissions and the public are reminded that they must preserve order and decorum throughout the meeting. In that regard, members of the boards and commissions and the public are advised that any delay or disruption in the proceedings or a refusal to obey the orders of the board or commission or the presiding officer constitutes a violation of these rules. The city of Riverside is committed to fostering a workplace that provides dignity, respect, and civility to our employees, customers, and the public they serve.

We will now open the phone lines for a public comment.

Public comment is now open for this item. Call (951) 826-8688 and follow the prompts to access the meeting. To request to speak, press 9. When called to speak, press 6 to unmute. You can also join via Zoom. The meeting ID can be found on the agenda.

Miss secretary, do we have any public comment?

No callers. Also, would you please call roll? Of course. Thank you. Commissioner Ira. Commissioner Bello. Present. Commissioner Broton. Commissioner Hutchins.

Present.

Commissioner Ward? Present. Commissioner Benavides?

Present.

Commissioner Chernikov? Present. Commissioner Lagnar?

Present.

Chair Williams

present

vice chair vandenberg

present

we have quorum

Can I get a motion and a second to approve the consent calendar?

So moved. Second.

Ms. Martinez, will you please do a roll call vote. It has been moved and seconded to approve.

You

may now begin voting. Motion passes unanimously. Thank you.

Fellow commissioners of budget engagement commission this is just a workshop so any questions since we do not make policy let's make sure that they are staying in line with what is actually being discussed and that are and that it's incredibly pertinent because we have a lot of merchandise information to go over. I work in fashion, I'm sorry, I just came from work. We have a lot of information to go over, so let's keep this smooth and efficient. Thank you so much. Would city manager Mike Futrell like to speak? And thank you.

Good evening, madam chair, vice chair and commissioners. Mike Futrell, city manager. And pleased to open the, very first public work shop we are having on our fiscal year twenty twenty six, twenty twenty eight biannual budget. As you can see, we have brought the leadership of the city staff here to answer questions that you may have. But before I turn it over to Sergio Aguilar, our deputy finance director to present the item, I just wanted to express first my thanks to staff because this has been, at this point, a six month journey recognized early last year that, this was not going to be an easy budget exercise.

There are uncertainties and unpredictabilities every apparently throughout the world and that is influencing the economy for sure, but also our ability to predict the future. And our budget is a predictive tool. We are predicting what revenues may be the next fiscal year and predicting what our expenses may be and that has become increasingly difficult. However, we have presented to you a balanced five year budget. We'll walk through how we got there, what we had to do to get there and then certainly be available to answer any questions generally or if you have specific questions for one of the departments that are here.

So But back to staff again, thank you. It has not been an easy process. First, to try to understand the chaos and then also to craft really at the granular level a budget which is balanced yet still delivers robust services for residents of Riverside. And I think we have accomplished that. So with that, Sergio, lead us through. Thank you.

All right. Good evening Honorable Commissioner Sergio Aguilar, Deputy Finance Director. So this budget workshop is intended to provide you an overview and also an initial opportunity to offer feedback of both the General Fund and Measure Z budgets for the 2026 through 2028 biannual budget. And there are about 52 slides as part of this slide deck. So I'm going to go rather quickly on some of them to make sure we're spending time on those that may be of most interest and also to give you enough time for both discussion and feedback after conclusion of the presentation.

And as Mike alluded to, joined by leadership of the departments who will be able to answer questions along with us at the end of the presentation. So just real quickly on the budget development process, which I know you guys are very familiar with, but we have a pretty robust budget development process started at the end of last summer where department started working internally to identify some of the priority needs. At the same time, the budget office started working on the baseline budget to revise the revenue assumptions and also revise expenditures to account for current levels of service. Given for potential deficits, we also started working with departments to identify potential cost reduction strategies. And then also we started engaging the community.

We had community forums. And then we also subsequently released an online survey. And then ultimately, in the past several months, just coming together with city manager's office and the department to prioritize and make sure we're addressing the needs but also being mindful of fiscal limitations. And then now starting this public process with this being the first workshop that we're doing. Ultimately, we'll be going to council the full council in May for proposed and then getting adopted in June.

And then just really high level in a very simplistic manner, the budget strategy. First, determine what level of resources are needed to maintain the current levels of service. Then we compare the expenditure and revenue estimates developed as part of the baseline to see, well, what can we really afford? And then working with departments to identify the needs and priorities above the baseline and cost reductions to ultimately develop a budget that addresses the city's priorities and is also just mindful of where we are fiscally. In terms of the community engagement, so we have a pretty robust community engagement really to try to foster transparency and inclusivity in the budget process.

So this last year we held six community budget forums across the city and then we also held we did an online survey that was available for about one month. The community forums, they were attended by approximately 50 residents And then the online survey was completed by about two twenty seven respondents. So there's a detailed two attachments to the report that identify the results of both the online survey and then some of the feedback from the community forums. I'll just kind of at a high level talk about a couple of things that we found. So about 52 of the respondents from the online survey were either somewhat satisfied or very satisfied with city services, which is a good news.

We also had questions where the respondents would like to see either increased funding or decreased funding. And the general category that got the most votes for increased funding was infrastructure, which includes streets, sidewalks and lighting. And then the category that got most the votes for decreased funding was on the culture and quality of life programs. We also had a question related to revenues and kind of if we had increased revenues, what preferred approaches would there be? And fee for services was the one that would receive the highest rating there.

In terms of the community forums, we had three different themes for the forums, and we had two meetings per theme. So for the public safety theme, for each one of them, we had the attendees vote on programs. For public safety, PSET received the highest votes across all the programs in the public safety meetings. For the parks, library, and museum meetings, Park Safety received the highest votes there. And then for Public Works and Community Economic Development meetings, Street Services received the highest votes.

But of course, you have the, you know, detailed information as part of your packet. So starting off at a high level before we get into the details, the city is facing potential multiyear deficits due to both rising costs and also slower revenue growth. However, as Mike alluded to, there is still a very significant amount of uncertainty. And the forecast definitely gets murkier the further out you get into our five year forecast. So we are recommending taking some proactive measures now to balance the multiyear deficits with a strategic mix of solutions, and we will talk through those in detail.

Now given the uncertainty, we also want to be flexible on our approach. And if things do turn out better than what we are projecting, then we could also explore bringing back or undoing some of the reductions, especially in the second year, which has higher level of reductions. And all this being said, it is not doom and gloom, and we are still in a strong position because we have record level reserves, which most of which remain untouched as part of our budget proposal. To my last point, this slide demonstrates the reserve levels, about $76,400,000 in policy reserves, which remain untouched as part of this proposal. And then we have about $161,800,000 in other reserves, most of which are related to pension.

As part of our proposed budget, we are recommending using the unassigned balance and I'll get into that in more detail when we get to that section of the presentation. And then we're also proposing to continue using the Section 115 set aside and then also starting to use the trust in the second year, and we'll get into those details as well. For Measure Z, including the policy reserves, we'd have close to $30,000,000 in reserves there, and we would anticipate drawing those down across the proposed five year plan. So this next slide here really just shows the full five years. And the point of this slide is we are proposing budget with expenditures aligning with the levels of revenue and there is growth in all years.

This slide is a high level breakdown of the city's general fund revenue. And so property tax and sales tax combined are about 52% of the revenue. So when you think about economic impacts and change in policies and federal policies when there's changes that could impact consumer purchasing and purchasing the homes, that could have a significant downstream impact on our revenues. GFT, general fund transfer, is the second largest at 16%. Electric is 13% of that.

And then water, we're continuing to recommend to escrow a pending resolution of that litigation. And then there are various other revenue sources that make up the difference. This slide just shows the projected growth in general fund revenues. And so overall, you'll see kind of bottom line still projected to grow revenues by 0.3% in the first year, 5.3% in the second year. Most categories are still growing at moderate levels with a few exceptions.

And if you remove some of the kind of onetime revenue adjustments, our ongoing revenue is growing at about 3.6% in year 13.9% in year two. This next slide shows the expenditures by category. And so you'll see personnel is about 71% of our general fund expenditures, and it goes up to 77% when you include the pension unfunded accrued liability. So any changes in the budget related to personnel and salaries ultimately does have a high impact on our overall general fund budget. Non personnel is about 17.6% and the various other categories make up the difference.

In terms of the prioritization of the general fund by program area, 56% of the general fund is public safety related with fire and PD followed by community services at 25% and then the internal service departments being about 15%. This slide here really just kind of breaks down the previous slide, but having the detail by department with a dollar and a percentage perspective. So you'll kind of see the departments that receive the highest dollar amount within each of those respective programmatic categories. So this slide provides a breakdown of the general fund budget by department with year over year percent growth. And top line, I think what you'll see here is although we are proposing reductions, we'll get into shortly, departments' budgets are mostly still all growing in fiscal year twenty twenty first year and then all they will all grow in the second year.

Police and Fire have the largest growth with a growing combined $15,800,000 in year one and then $5,000,000 in year two. Now there are some departments where you'll see an increase and one example in Public Works, one of the reasons why you do see a decline in the first year of the proposed budget versus the current year is there were several onetime expenditures that were approved in the last biannual budget that would drop off. And so we're either partially continuing some of those expenditures or not continuing some of those expenditures. So some of that is just a reflection of onetime expenditures dropping off as part of this proposed budget. This next slide demonstrates the year over year general fund expenditure growth by expenditure category.

And so a couple of things I'll just point out on this slide. As we kind of displayed in one of the previous slides, about 71% of the general fund is personnel related. And you'll see here personnel is growing at 3.3% in year one and then 5.9% in year two. So one of the kind of the areas just of caution is if these personnel growth keep on growing at a higher level than revenue growth just because it's such a large percent of our budget, then that overall may result in future challenges. You'll see increases in CalPERS UAL, but we do have a proposed strategy to address those increases with the 115 set aside and the 115 trust, which we will get into more detail in a future slide.

For non personnel, the decrease is mostly tied to reductions to address the deficit that we will also walk through. And then you'll see some kind of increases in special projects and that's primarily due to a new animal services contract with the county and also some related city programming requirements. So this next slide is a high level view of the multiyear Measure Z spending plan. So Measure Z revenues have lagged compared to general fund growth. And in 'twenty three, 'twenty four, it was the first year we experienced an actual decrease in Measure Z revenues.

In 'twenty four, 'twenty five, we experienced another decrease in Measure Z revenues. But looking ahead, we are projecting some moderate growth levels of 0.5% in year one and then 2.9% in year two. In terms of expenditures, one important thing to note about Measure Z is as part of last the last biannual budget, because we had such a high fund balance, The City Council made strategic decisions to increase expenditures for several years to draw down on that balance with expectation that then the expenditure levels would normalize and more align to the revenues once we drew down on balance. So one of the reasons why you see kind of a drop in expenditures for a couple of years is that. And then the second reason is because of several proposed reductions that we are also recommending as part of this this budget.

This slide, similar to the general fund, just shows kind of Measure Z expenditures by department. And for Measure Z, although most budgets are decreasing decreasing in in fiscal fiscal year year 'twenty 'twenty six, six, 'twenty seven, just to the point in my previous slide, some of that is related to decreases that were already kind of preprogrammed and then other components are decreases that we are recommending as part of this budget. In terms of the prioritization of Measure Z by program area, this kind of shows that public safety is about 72% of Measure Z expenditures followed by community services at 21%. So comparing to the general fund in Measure Z, more of public safety goes in Measure Z than it does in the general fund from a percent perspective. And then similar to the views on the general fund, kind of same slide as in the Measure Z where breakdown by program area and department, dollar and percent.

The one thing I'll note here is the service support transfer from Measure Z to the General Fund, we do count as public safety because that was the intent of that transfer to help offset increased public safety costs in the general fund. So that is captured in that category. Community services, public works being the largest there, paving program being the largest expenditure of that category. And then this next slide breaks down the Measure Z expenditures by category. And a couple of notes here.

Personnel cost increases, those are primarily due to public safety, salaries and overtime increases in Measure Z, about 140 of the 173 positions are tied to public safety. And then also the decreases that you'll see in the non personnel, special projects and capital outlay are due both to the planned decreases and then also additional recommended decreases. And then this just kind of shows a similar viewpoint as we did on the general fund side, breakdown by expenditure category. And you'll see compared to the general fund on personnel, there's a much less personnel tied to Measure Z than it is on the general fund, which was 71%. Here it's 32%.

Now the one thing that we look at when thinking about Measure Z and as we get into the discussion of the cost reductions is where is their flexibility in Measure Z. And so if you combine personnel, debt service, the UAL and the general fund support transfer, which we would consider a lot less flexible, that's about 70% of measures E expenditures. So there's only about 30% that we consider it has some additional flexibility tied to it. This next slide just shows the position breakdown by department. This includes both General Fund and Measure Z.

And so when it comes to tax for FTEs, we're not really recommending too many changes in the first year. I think one is just making sure we're fully funding a new approved fire marshal as part of the first year. In the second year, we are recommending adding four positions to the museum and that is to address the reopening of the main downtown museum. So they'll need some additional FTEs and funding that we'll kind of talk through a little bit later. All right.

So now getting into, I think, what one of the pieces that may be of most interest is the actual deficit and then how we are proposing to solve it. So just context on the deficit. Back in June 2024 when the council adopted the last biannual budget, that budget had a five year plan and that five year plan had balanced revenues and expenditures across all five years, right? And so years three and four of last year's biannual is now years one and two of this proposed biannual. So our comparison is, well, what changed from the forecast of that projection to where we are now within what was our baseline?

And when you compare those two, the revenues are lower by $8,100,000 in year one, lower by $9,000,000 in year two and expenditures are higher by $19,000,000 in year one and twenty four million dollars year two. So when you combine the net impact of that, our deficit would be $27,000,000 in year one and 34,000,000 in year two. So in essence, if we take no action to address the deficit, which we'll get into a little bit later, we would be negative $27,000,000 in net revenue expenditure in that first year and net negative 34,000,000 in the second year. Now on the revenue side, just to go into a little bit of the details, property tax and sales tax, they're still growing but growing at a lower rate than what we had initially projected. For user utility tax, the biggest area of decrease was natural gas and cable.

Franchise fees had also declined and cable was one of the driving factors there, which makes sense as there's more people now going to streaming, so we're getting less revenue from all kind of cable related city revenue. For licenses and non developer permits, we had an assumption related to the business discovery program that did not fully materialize. And so then that projection came down. And then we also before, we're factoring in potential revenue from JP land sales, the March JP A, which we get a percentage of. However, those are very uncertain with the timing and when they will occur.

And so now we're just no longer projecting those. So those are the driving factors on the revenue side. On the expenditure side, payroll health and benefits, and that's due to a combination of salary increases and overtime, particularly within fire and PD. The UAL, that's the pension of funded accrued liability. So every year, we get an updated actuarial report from CalPERS.

They've been coming in higher the past couple of years, but we do have a plan to address those. In terms of the workers' comp general liability trust, that reflects the increase needed to maintain our 50% policy reserve requirement. And then there's a few other factors that make up the difference there. Now we did a similar comparison for Measure Z even though Measure Z is slightly different. So in Measure Z, in the last biannual budget in the 2627, the thirty year of that forecast, we were anticipated to draw down strategically a little bit under $10,000,000 And so here, similar from that forecast of this forecast, the revenues are lower by $5,000,000 in the first year, expenditures are higher.

So if we would do nothing, we would be drawing down $20,000,000 in that year versus the 10,000,000 that was forecasted. So that just reflects the deficit from the previous forecast and the previous approved budget. And then similar, that grows in the second year to $12,000,000 Now staff are proposing a multi pronged approach to address the projected deficit with a mix of both onetime and also ongoing solutions. And this was developed under a framework that protects core city services. And that's one of the things that we're most mindful of as we're talking and thinking through all the potential cost reductions to make sure we understood the impact to residents.

Second, strategically phasing in reductions. And so the deficit grows in year two and being mindful of what reductions to start in the first year versus which to start in the second year. And in the second year, there might be a couple more impactful reductions in the first year. That strategically buys us time where if the revenue picture turned out to be a little bit better, then we don't move forward with those reductions in year two because we had to come back and get that readopted. So it's strategic to buy us time for some of the potentially more impactful reductions, also just maximizing some onetime solutions, minimizing use of reserves and then also that helping us maintain long term fiscal sustainability.

So this is high level summary on the how we're proposing to solve the deficit, one being cost reductions. And so finance staff collaborated with the city departments to identify cost reductions across two different steps. So one is we reviewed the expenditure that had historically generated savings. And then two, we also evaluated where reductions could be implemented without significantly impacting core services and that includes strategically holding some positions vacant. So we are recommending a total of about $17,950,000 in reductions in year one and 22,270,000.00 in year two when you combine both the general fund and Measure Z.

And again, some of these reductions are phased in to start in year two. One very important point to note about these reductions. So most programs are still receiving budgets that are above the historical levels before the large increases in those last biannual budget. So in thinking about the last twenty four biannual budget, we had a higher level of revenue projections than before. So there were a lot of increases built in.

So when you kind of bring back down and assume those didn't happen, we're still at historical levels of expenditures before this last biannual budget even accounting for these reductions. Now as part of the fiscal year 2024, 2025 year end and we presented that to the BC, there was a remaining unassigned balance of about $9,560,000 that was after the required transfers to reserves. So And we are recommending using that unassigned balance and that's one time, but it helps address the deficit while being mindful of not adding to additional cost reductions. In terms of the general fund general liability true up, so Council has a policy to set aside 50% of our estimated claims and liabilities for general liability and workers' comp. And our methodology is one that requires all the Citi funds to contribute to that trust.

And there were several years where we were under that 50% requirement and we made supplemental transfers to that trust from the general fund and Measure Z. And so what we're doing now is a one time true up to account for what share the other funds should have paid associated with those supplemental transfers and that for a one time basis drops down the level of general fund needed for that year from that trust. We're also recommending CPI increases to fees and charges. This is something that other local jurisdictions do have and it's one way to make sure we're keeping pace with the cost, the growing cost of the city to provide services. And then also ultimately being mindful that when we do kind of a more comprehensive update, it doesn't result in a massive fee increase because you're kind of incrementally just increasing them based off of CPI.

And then also the use of the Section 115 set aside, which we'll get into a slide where I'll kind of explain what that represents. So overall, purpose of this is really kind of showing we are living within our means. We are making the necessary reductions to maintain the current levels of service while still actually adding some funding to support additional critical needs. So even though we are making $18,000,000 worth of reductions, holding about 38 positions strategically vacant to be able to achieve some savings, there are some additions where even under this time where we just make reductions, we still need to fill the gaps of critical needs. And we'll walk through a couple examples of police and fire being among those that receive the highest amounts there.

This is just kind of a breakdown of the cost reductions by department. We know we have a detailed attachment that has all the list of every single reduction broken out by department. But just kind of pointing out here, even though PD does have the highest dollar amount reduction, they are among the lowest percent of budget reduction after fire. And then most departments, with a few exceptions, are under 4% in terms of reduction compared to the budget. Then this is a similar view on the Measure Z side.

And so the Measure Z side, it is a greater percent of budget for departments given that Measure Z is a much lower fund compared to the overall general fund. But overall, just kind of to my earlier point, for many of these programs, they're still receiving amounts that are higher than what they were getting historically before this last biennial budget. So in terms of the trust, so in 2019, the city established the trust that was set aside to help smooth out pension payments during those years where the city would otherwise need to make higher level of payments. And that goal was to initially reach $100,000,000 in that trust before we started drawing on it. And then in addition to that, there's also about 35,000,000 that was set aside in an additional trust reserve.

And that also was supposed to help offset some of the contributions that we were going to have to make. So if you look at this chart, the blue line is the level of general fund payments that we would need to make if we had no trust to offset. And then the orange line is what we are proposing as part of this budget. And you'll see it allows us to smooth throughout the entire period that we would otherwise see the peaks. And under this approach, we have enough funding to take us through that period.

Now every year, we'll get a new actuarial analysis from CalPERS, so it will kind of fluctuate up and down. And so we'll need to revisit this again. But from the current standpoint, this approach helps us meet the need. To my earlier point, even though we are in a time where we are living within our means and making some reductions, we're increasing some of the budgets for departments. And so this is just kind of a breakdown by department where there are increased and critical needs, and we'll get through some of those details in these next subsequent slides.

So now we're going to go into each department's budget for the General Fund and Measure Z, and we're only going to highlight a few of the kind of more either significant cost reductions or critical needs. There is again a comprehensive list in the attachment attachments that have the breakdown of everything. But in the interest of time, we'll just go through high level. So for city manager's office, about 100,000.0 in year one, 5,300,000.0 budget in year two. And there's various proposed reductions here, including savings in personnel for maintaining vacancies, reductions in funding for as needed contracts and projects, and then also reduction for travel and meeting expenses.

Going to the clerk, dollars 2,400,000.0 budget in year one and $2,800,000 budget in year two. And the proposed reductions are associated with savings from lease space from a contract and then also a reduction in funding for the annual Board and Commission reception. And that will still be held, but just at a little bit of a smaller scale than currently is. In terms of the City Attorney Office of the City Attorney, dollars 5,900,000.0 in year one, 6,300,000.0 in year two and there are some proposed reductions associated with personnel savings and also in year two some reductions to quality of life programs. For Marketing and Communications, 2,800,000.0 budget in year one and in year two.

And the proposed reductions, one is in translation services, and that's both for Spanish and ASL. However, important point here is this is really just to adjust to actual expenditures. There's no anticipated reduction in actual service. It's just the budget was higher than what they've actually been spending. So no reduction in service anticipated.

And then this is kind of one example where in terms of the critical needs, there's two factors. One was new critical needs and then the second was extension of some previous one time limit term funding that was approved in the twenty fourtwenty five budget and the twenty fivetwenty six budget. So they would otherwise drop if they don't continue. So that's an example here for the marketing department extension of funding for the Visit Riverside campaign for the Riverside TV content curation, city branding initiatives and street pool banners and flags. And even though there is money being extended, it is still at a lower level than what they're actually getting in the current year.

So it's still at a reduced level even though there is an extension. For Human Resources, dollars 6,300,000.0 budget in year one, dollars 6,600,000.0 in year two. And some of the proposed reductions here include personnel savings from maintaining vacant positions, a decrease in education reimbursements and citywide training, but I'll note that they would still receive amounts that are higher than were included before the 2024 budget. Then also, you know, formalizing the Office of the Inspector General with three FTEs included there. Moving on to general services, dollars 8,600,000.0 budget in year one, rounded $8.8 in year two.

And there are some proposed reductions in citywide deferred maintenance of about $1,000,000 And even with this reduction in Measures E deferred maintenance, they would still remain at amounts similar again than they were receiving before the last increase in the last biannual budget. Also proposing reduction in non public safety vehicle replacements. And the budget still maintains $600,000 which is actually the same amount that is being received in 'twenty five, 'twenty six in the current year. And this was actually a new set of funding that was provided in the last biannual. So it's still higher than historical amounts, which there was not additional funding previously being provided.

In terms of finance department, 10,900,000.0 in year one, 11,800,000.0 in year two. So some proposed reductions in various professional services and ad hoc contracts, a reduction in the printing of the budget book, which is now available digitally, so no longer need to make printed copies. And there's also one proposed increase of $50,000 one time and it's associated with an investment management services contract. For Innovation and Technology, 17,300,000.0 in year one and $18,200,000 in year two and some reductions associated with savings in various retiring systems or software replacement and also a reduction in funding for technology replacements. In terms of the Measure Z technology replacement, that program would still receive funding that were greater than what provided before the last biannual budget.

In terms of housing and human services, 8,900,000.0 in year one, 7,900,000.0 in year two. And there's a reduction here within the PSET program in contracted services and then also maintaining two outreach worker positions vacant. But we'll note that even with these reductions in PSET, the total proposed PSET budget is still higher than it is in the current year budget. And the amount maintained for contracted services is still higher than the amount that has actually been spent in contracted service on an annual basis for the PSET program from Measure Z. In terms of community and economic development, dollars 18,700,000.0 budget in year one, dollars 20,000,000 in year two and reductions in funding for various professional services such as economic analysis, special studies, specific plan updates and also maintaining vacant positions.

Now similar to marketing, proposed budget also includes a continuation of some previously limited term funding for economic development, marketing and implementation, and that is at the same level that was provided in the current budget and in the 'twenty four-twenty five budget. Moving on to the Police Department, 167,500,000.0 in year one and $173,500,000 in year two. And so here, this is from proposed reductions from vacant non sworn positions and also vehicle replacement. So given that the reduction or that the deficit does grow in year two and in the out years, there's also an additional kind of unallocated reduction in year two of about $2,000,000 And in essence, if things don't turn out better in our projections for the next year, then before we come to Council for the readoption of the second year of the budget, that would need to be identified in terms of what specific programs would be cut from that $2,000,000 there. Now there's also a proposed increase in Police Department budget, and that includes $1,500,000 in overtime, and that would align with the higher spending trends and costs associated to participating within the county public safety communication system in Measure Z.

Moving on to fire, dollars 91,600,000.0 budget in year January ninety two point five million dollars in year two. So some proposed reductions include maintaining some non firefighter positions vacant and then also a reduction in vehicle replacement funding. Now for vehicle replacement funding, the budget still maintains amounts that are higher than any previous budget for vehicle replacement because that allocation was anticipated to increase initially in 'twenty six, 'twenty seven as part of the last adopted five year plan. And then similar to what referenced in PD, on the fire side, also recommending an unallocated reduction in year two of $500,000 Now for fire, there are also various critical needs and in this department, about $1,100,000 in additional funding is recommended and that addresses various things, including cardiac monitors, PPE, funding for physical firefighters and also for communications licensing. Moving on to public works, 35,900,000.0 budget in year one and $36,200,000 in year two.

And there are some proposed reductions from savings to maintain various positions vacant and also a reduction in crossing guard contract funding. I'll make a clarification on the crossing guard funding that got some additional clarity today based off some additional information. It should not anticipate to result in a decrease in the actual number of locations. There's actually savings there, so this should kind of more align to actual spending. And there's also a reduction in Measure Z pavement funding, and we'll cover that in the next slide in more detail so you see the net impact to that program.

And then there's also some increases in public works, and that's tied to renewed County Animal Services contract and also a partial extension of previously one time funding related to irrigation supplies, repairs and replacement. But they are lower extensions than what was approved in a current year budget. So this slide covers a kind of holistic picture of the paving program funding given that there's multiple fund sources that support this program. So it gives a holistic view of adopted budgets going back from twenty twenty one-twenty two through what we are proposing for 'twenty six, 'twenty seven and 'twenty seven, 'twenty eight. So a couple of things to note for the proposed budgets, you'll see the CDBG is still TBD.

I think we won't know that amount for a few months longer. But assuming that there is similar funding received in the next two years as in the past couple of years, even with the reduction in Measure Z proposed budget, the bottom line will still be pretty much close to what is being provided in 'twenty five, 'twenty six. And that's due to Measure A. The Public Works Department is able to increase some of the use of Measure for this purpose, which may also kind of impact drawing of some grant programs, but this helps offset some of the loss of the Measure Z funding for these next two years. But bottom line, the program itself, from a total fund perspective will still be maintained as whole as possible.

Moving on to the library, 14,400,000.0 budget in year one, fifteen point two proposed reduction associated with savings with a strategic closure of select underutilized libraries on Sundays, which I believe it's starting in a week or so, if I'm remembering correctly. And so the city made an announcement of that already. Now there will still be some libraries that will be open on Sundays, those that are most utilized, but there's just a lot less foot traffic in some of them, so strategically closing them, which will create some savings. And then also an extension of previous one time funding related to the ongoing purchasing of books. For Parks, Recreation and Community Services, 38,100,000.0 budget in year one and 38,400,000.0 in year two.

Various proposed reductions here include funding related to citywide and ward events, which was some new funding that was provided as part of this last biannual budget, reduction in contracted security services, parks, capital improvements, and also maintaining some part time recreation positions vacant and also reduction in capital expenses related to the measures of senior and disabled program. Now, of course, important to note that similar to kind of the other programs, even with these reductions, in most cases still receiving higher amounts of funding than they were before the larger increases in the 'twenty four biannual budget. And then going on to the museum, 15,000,000 or $5,700,000 in year one and 7,300,000.0 in year two. The proposed reduction associated with maintaining some position vacant. And then, Nihikat, to my earlier comment, budget proposes increased funding and FTEs starting in the second year in 'twenty seven, 'twenty eight and ongoing to support the opening of the new main downtown museum after that construction is completed.

And then moving on to the mayor's office, 1,400,000.0 in year one, 1,500,000.0 in year two. And this includes a reduction of travel funding for the big city mayors and U. Conference of Mayors travel and that's a reduction compared to what the mayor's office is receiving in the current year. And then for the case City Council budget, no significant changes, just, you know, regular increases in personnel costs and others. All right.

So with that, that covers everything. And of course, we have all the department leadership here to help answer questions. So now we could open it up. Thank

you so much for all of that information and I don't really have a question but I have a what? Oh my god I forgot public comment I called myself too soon. Ms. Martinez is there any public comment?

No callers.

Commissioner Williams. Okay now I will speak. Okay. So I just have like a just a small statement. I would imagine if I worked for the city in a planning capacity I would be going for Utopia.

Right? I would take this job and think to myself how do I make my world a better place? I think with passion for myself. So, I'm looking at the numbers and I got curious and this is more of a rhetorical question. We have a lot of measures going to public safety and a lot of these things are in response mostly due to poverty, scarcity, and lack of food, shelter, books.

And then I look to see where we are spending on community services, housing, human services, a lot of our police phone calls go to those very things, especially with the unhoused community. Libraries are closing on Sunday but all of your children have books and you can send them to places to have experiences. Dance classes, swimming because you can afford to and the communities that are most affected from lack of books and need the most public safety are the communities where there's not very much to give. So I ask you just to imagine possibly if a little more was poured into human services, the parks and recreation, the things that make communities stronger, make humans better. If more was put into that, possibly our public safety would have less of a need to go into response for small things because we've worked on it on the front end and we've made sure that our libraries have books number one.

That we make sure our food pantries are full. That we make sure that we have the programming for the least of our communities. And then there might be, and I am not saying at all to any public service and first responder, you are valued and respected and appreciated and so much braver than I am, than many of us. But if we invested possibly a little bit more of Measure Z since it is coming from the community. It is to be for them to really bolster those services.

I just looked at the numbers and imagined what if there was more for the least of our community and what would that look like? And I wonder what kind of police calls we would get then when our communities are fed, nourished, educated, taken care of, and clean. That's all. Thank you. Commissioner Vandenberg.

Thank you, Chair Williams and thank you for your report. I'm going to speak specifically to Measure Z dollars here, take the general budget out. Measure Z dollars specifically, I've got the original Measure Z ballot statement. It says to prevent cutting police, firefighters, paramedics, 911 emergency response, anti gang, drug programs, homeless reduction, youth, after school, senior, disabled services, to repair local streets, potholes, other infrastructure, and to provide other general services shall a 1¢ transaction and use tax be implemented raising $48,000,000 annually through 2036 unless extended by voters. I'm looking for specifics here if we can.

I saw the I saw the pie charts and I saw the breakdowns, but specifically, I'm looking for information on how much measures e dollars went to police, how much went to fire, how much was invested in youth services, seniors and people with disabilities, homeless reduction, streets and infrastructure, and then I'd like a breakdown of general services. I saw on the pie chart, I saw community services and I saw other. And I'm assuming this is where general services went in. There's a lot of conversations being had, at the doors I'm knocking on on on social media about where the money is being spent if it aligns properly with what we voted for. And I think that that's an important topic and important information to get out there.

If it is, that's great. I want people to know. And if not, they should know before we vote on increasing that and extending it. So is it possible? And this might have to be something we add to the next meeting. I don't know if it's available today. But those were specifically pointed out on the measured ballot when we voted. Those exact topics that I listed there. Is there a way to find out how much of and that at at company. I'd I'd like to take of we gotta come back to this at at at a topic for the next meeting, that's okay. Okay.

Sure. I'll answer it in general, and then I think we can get you the numbers. The short answer is absolutely yes. Measure z was spent in accordance with the ballot measure of 2016. The budget you're seeing right now, 72% of measure z goes to police and fire and public safety.

We can get you that break breakdown. The current year budget, I believe, an additional $8,000,000 goes to street and potholes, bringing that to, I think, 9,000,000 in this current year budget for streets and potholes, which ranks, from my understanding, number two after homelessness for issues that most people in town talk about. On the homelessness side, both the Wildlands and the Urban PSET teams are funded out of Measure z. As to seniors, the disabled, other programs we'll have to get you that. But there are dollars in there and I think you know that last year or the year prior we increased that a little bit as best we could.

So But we can get you those, but I can assure you I've looked at the same issues. I've heard the same questions, and we are absolutely spending the money for the categories in the 2016 ballot measure. We all keep that. In fact, I have that downloaded to my phone because I get asked that question a lot right now. And it did accomplish its major goal which was to prevent layoffs in police, fire, and other services, which as I understand it was the giant threat at that time. But we can get you the specific numbers.

Yeah. So I mean, it depends on there's some specific numbers I give you now. If you're asking about the actual budget we're proposing, for example, if we look at police and just want to look at what their bottom line measure Z is, police bottom line measure Z is proposed at $32,700,000 year one. If you want to look at what fire bottom line measure Z is, about $12,200,000 in year one. And then broken down by categories, we have historicals.

We have various pie charts where we have historicals going back from 2017 to actuals in 2025. So it depends on kind of what breakdown of categorization. But we have many of spreadsheets available to kind of give you different breakouts of information. It just depends on what level, what years. But we definitely have all that information.

I'm looking for something simple to read for your average person who's not paying attention daily like some of are, someone who's getting ready to vote and wants to see, because I'm getting these questions just like you are, sir. Youth services, have we invested any money specifically for youth? As of last year, we didn't have any money specifically going to seniors and people with disabilities. We got the $500,000 budget line added and created, and then it got cut in half, I think, or close to a $2.70 with the budget cuts last year. So those youth services, seniors and people disabilities were two things specifically pointed out on the ballot statement, and I would just like to know those two specifically. I haven't heard anything yet. What we've invested in those two. Homeless reduction, it sounds like we're qualifying PSET as homeless reduction, the investment in PSET. Is that correct? Okay.

And then streets and infrastructure, you got me that number. So then it just comes down to general services. What falls under general services? How much Measure Z dollars were put into general services? And I think your pie chart, I think you called it community services and other. I would assume that's the general services that was on that ballot statement. Is that accurate to assume?

So community services would be like parks. Parks, museum, library. So things like that, those would fall under what are the community services buckets.

Okay. Yeah. Okay. So the total investment in those buckets then, I guess, the Measure Z dollars would be good to know?

Yeah. So I mean if you want to know now in terms of how much each of those departments receives that are kind of calculated under the community services. So we'll start with parks. Parks in the proposed budget, and this is not including their capital funding because the capital funding gets captured separately. If you include their capital funding there, I wanna say about $22,000,000 in terms of parks.

Then for housing and humans well, housing and humans is a fall there. For a library, library is 2.7, and that's tied to the debt service. And then museum is $2,900,000 So those are what they're recommended to receive in the first year of the proposed biannual budget.

Are we funding pension obligation bonds? Are we covering that those expenses through Measure Z as well? Or are those things being paid transferred from Measure Z dollars?

So there's two remaining years left on Measure Z for the pension obligation bond. And I want to say they're about 1,600,000.0 or $1,700,000 They're actually I think the first row yes, actually we have only one year left. So twenty six-twenty seven is the last year of pension obligation bond debt payments from Measure Z at $1,670,000

And

that's in the Measure Z attachment and that's the first line there.

Okay. I think that's all. Thank you.

Commissioner Ira.

Thank you, Chair. I'll try to be brief, but I know that I can. So, first of all, thank you for this report. Know, I had a chance to read through this before and I had a few questions that I think you answered during your report, but a few more that I had that popped up during the report. First of all, if you could just kind of just again break down kind of in layman's terms why we're seeing a $27,000,000 first year deficit and $34,000,000 second year deficit. You mentioned it was kind of a combination of factors. If you could just elaborate just a little bit, too.

Yeah. So two pieces, right? So budget is revenues and expenditures. On the revenue side, lower revenues projected now than we did before. That's a little bit over $8,000,000 On the expenditure side, it went the opposite where we're projecting higher expenditures by that nineteen million dollars So that combined factor of lower projected revenue, higher projected expenditures, it's like a double hit, right?

And so that double hit is basically what's now creating that $27,000,000 deficit in year one. And then it grows in year two because the assumptions were higher in year two than year one as part of the previous budget so that just automatically grows. And then the expenditures also grew more in year two than they did in year one. And so those two factors, so expenditures are the main piece of it at 19,000,000 compared to the revenues. But both pieces play a part of the puzzle.

Perfect. Thank you so much. Yeah, that's helpful. One

of the

things I wanted to flag and this is as someone who attended a couple of the community budget forums. By the way, I I think that was a fantastic idea. I think the staff did a fantastic job. I'm just bummed that we had a pretty low engagement as compared to the city. Looking at it, it looks like we had in total about 277 people.

Less 300 people for a city of 330,000 participate in the the budget process. So I would love in the future, you know, finding ways we can augment or help or or plug, you know, council members or other folks into as well. Maybe getting some of our local influencers to talk about this because everyone's on social these days. But just finding ways to plug more people in because I think, you know, in reading through the priorities that residents outlined, it's kind of clear, you know, what they find to be the most important. And again, I wanna be mindful that this is not maybe a one to one kind of representation.

But in in what I'm seeing here, they're, you know, they identified for instance the PSET program was the top top one under the police forum feedback. Mhmm. PSET was the top one under housing and human services as well. PSET was number one under public safety and health and human services as well. And then there was a few others too that I saw with regards to park safety, I'm assuming PSET essentially kinda covers as well.

And then the pavement management program, street services, and pavement management programs under public works and community economic development. So I noticed that these were programs that we were reducing spending on. I'm wondering, you know, if that's the case, how how much consideration were was the community budget forum feedback given? Because it seems like the programs we are cutting are the ones that residents kind of identified as the priority. So I'm just wondering like was there a formula that you guys plugged this into? Or how was that kind of done?

Yes. So we definitely did consider some of that feedback. And I would just note a couple things. So our process was kind of twofold. One is looking where there are areas where we've had savings, historical savings where the level of expenditures are not materializing to the level of budget that has been provided. So in essence, in those, it's not a reduction in service. It's just kind of truing up for expenditures. And then two, looking at programs to say, if we make kind of small reductions, where could it not have a big impact on services? And what does that budget mean to historical budgets? And in the case of PSET.

So PSET, even with the reduction, still budgeted higher in 'twenty six, 'twenty seven than 'twenty five, 'twenty six. So still higher with a reduction next year than the current year. So overall, messaging there is, hey, we're still increasing Pizza Hut program. Maybe it's not increasing at the higher level than what we had initially kind of projected, but it's still increasing as an example. And then under kind of the P set example, the reduction was in contracted services.

So the actual expansion for contracted services have been lower than what the budget is. And so we're bringing it down slightly, still not to the level of actuals. We're still leaving a buffer there, but just bringing it down. So I'll just kind of use PISA as an example where it is strategic, right? It's not just, oh, let's just cut a program. We're trying to be mindful where they've had savings, what budgets are compared to where they were before. But definitely keeping in mind where do those priorities have been identified.

And if I could add a little bit about the process. When I mentioned in the opening that we've been working this for six months with the departments, it really was a collaboration and and departments were asked to bring to the table their ideas based on operations and minimal impact to the public. Where would you cut? So, by and large, all of these originated from the department. This was not a top down directive.

Instead, it was an organic working with many many sessions collectively. So in the example, for example, we we did cut from p set the contractors who clean up encampments. And on its face, you may say, why would we do that? Well, that's because historically, year over year, they had not spent all the money. So, now, we have a track record we can say, well, this is actually how much money they need. We gave them too much money to start with. The same and I'll I'll mention the library because came up. That came up organically from the library itself. When I first got here, none of the libraries were open on Sunday. They're all closed Sunday and Monday.

And we said, well, let's open all the libraries on Sunday. So we did. Now we have two years of data to show that with the exception of three libraries, very few people were going to the libraries on Sunday. And it was hard on staff because now they rarely get a weekend off. So, the library director came to me and said, this is really more about just being smart because we can see these libraries have minimal attendance on Sunday.

Let's keep the three open where it act people actually are going based on data, but it also coincidentally resulted in a budget savings. So, we tried to be thoughtful. Now, that's not to say we got it right. We want your feedback. We want council's feedback and the public's feedback, But I just wanna let you know that's how we arrived at at the thoughtful reductions that we had to make.

Thank you. Yeah. And I I, you know, was not insinuating you guys didn't put thought into it. Just more so understanding the role that community feedback plays in identifying some of those priorities. One one that I know, you know, I usually will go out to community meetings after this meeting and just share out what's going on as a as a commissioner especially in Ward 2. And I know the reduction in pavement funding is is a question that I'm sure many of us here had. Ward 2 has a lot of potholes. Drove over a huge one on my way here. I'm wondering, you know, for for instance, for the cost reductions in the other areas, I could understand the argument there. But potholes are a kind of ongoing issue.

How are we maintaining a similar level of service or addressing those if we're reducing it by $2,700,000 to $3,800,000

Yeah. So on this one, I think one of the things that we kind of were mindful of is the whole paving program budget, right? Because what we're presenting here today is general fund and measure Z in terms of kind of the workshop, right? But there's other funding sources that support some of these programs. And kind of to the earlier comment about housing and human services, housing and human services gets other funding sources that are not in this breakdown because they're not general fund measures, either they get grants, they get federal funding.

This is the case where Public Works also gets other funding sources that support the overall paving program. So what we're trying to do is kind of be mindful of the bottom line of even with this reduction, what does it mean to the bottom line of that program and would it reduce the level of service, if you will, from a bottom line perspective. And in this case, Public Works identified that they were able allocate a little bit more Measure A funding than they were in previous years. So you'll see in this chart, Measure A goes up in the proposed budget compared to the previous years. So that helps offset some of that loss in Measure D funding.

And then ultimately, you'll still see the TBD on CVBG. Once that comes in, then we'll have the full picture of the bottom line. The one other thing just to kind of be mindful of and I made this comment in one the previous slides was when looking at Measure Z and also general fund, it's looking at what things have more flexibility than others, right? About 70% of Measure Z we would consider very unflexible because it's to debt obligations, it's tied to personnel and it's tied to that kind of general fund to risk transfer. That is less flexible unless we're going to start firing people or unless we're not going to meet our debt obligations.

Now in this case, there was some flexibility here and the benefit that we could have some other money to offset the reduction. So that was the strategy here overall from the larger budget picture, but then from the program perspective where we are trying to maintain the bottom line as whole as possible.

Thank you. And last one for me, I promise. I'm wondering, as we're doing some belt tightening, and I think I may have asked this at a couple of previous commission meetings, Are are we also looking at ways to creatively increase the amount of revenue that is coming into the city? I know a question I raised at the last commission meeting was just us revisiting our developer development impact fees here in the city. I know there's Some some parts of those haven't been updated in some quite some time.

And it seems like we're now going to the tax payers to cover part of what those development impact fees could have covered. Maybe not the whole part, but certainly a significant chunk of it could have been covered by that. So I'm just wondering as we've seen kind of record growth in certain areas of the city, are we looking at ways to creatively bring some revenue into the tax base as well?

Yeah. So I think a couple of things I'll note there. One of the components of addressing deficit is that CPI for fees and charges. And that doesn't include impact fees, but it does include developer fees. They're getting permits and those types of things.

So one thing that we want to do is make sure that we're always accounting for our costs are increasing, let's make sure we're recouping our increase in cost. And so by applying the CPI in the first year, it'd be about 5.7% because we're kind of catching up for two years. And then the out years, we're projecting about 2%. So that is built in as an assumption to help address the deficit. To the development impact fees, so we do have a consultant that is helping us with an update to development impact fees.

And we're actually required by law from a recent law that passed to basically have this study to update. So we are still going through that process. I think we're waiting on some data that's going to come out of the general plan to make sure that we plug that into the methodology and then ultimately take it to counsel for proposing to counsel to see if that's something they're interested in doing. But counsel did approve the contract to basically commission So this that's the second thing. The third thing I would note, which is something we recently did, whenever there's new community facility districts that are formed, which are basically when these larger developments come to the city to form a CFD, we are adding to that a public safety and a maintenance service element where we are now off of those developments able to collect some additional revenue to basically offset the additional services that the city would need to pay for these larger developments.

So we are doing a few things. The budget has one component. One, we already started for new CFDs. And then one is forward looking whenever we kind of finish that study that we're currently working on.

Thank you so much. I really appreciate the answers.

Commissioner Ward.

Thank you. And I just want to say again, thank you as always Sergio. And thank you to the leadership. Like for Trell for and and all the departments for really looking strategically at all your department's funding and and making strategic cuts, so that we can, you know, meet our our financial goals and be fiscally responsible. So I really appreciate.

I know there's a lot of hard work going into that. But having said that, I wanted to, drill down on just a few items, coming from, this budget that you're presenting here. So first with the personnel costs. The BLS employment cost index shows that average compensation in the state of California rose 3.4% in the last year. But there are person but it looks like personnel costs in 2728 are increasing by 5.9%.

And then if you look at individual line items for some of the departments for fiscal year 2627 and 2728, I'm looking at specific departments here. And, again, no shade to any of these departments at all. I've worked in one of these departments. The mayor's office, 12.7% increase in 2627. City council, 2627 is 14.8% and just follow me here everyone.

And then 6.4 increase the next year. City clerk, 7.4%, then 16.8%. Finance, 7.5, then seven. Innovation, six and then six again. So what I'm trying to get at here is the average BLS employment cost compensation is increasing by 3.4% but some of these departments and then overall employment costs are increasing above that threshold.

And so some of these departments have made significant cuts. I believe the city manager's office made a significant cut maybe 10%, city attorney's office 13% cut but some of these departments are obviously growing. What were the conversations with those departments like? Was there any pushback? And is there any way that we can get some of these departments to kind of meet meet the moment here to maybe go along with the average here or or actually make some cut some cuts so that we can keep that principle of staying within our means in mind.

So just a couple comments there. In terms of the personnel growth, guess the first thing you started with, right, the personnel year over year growth. So there have been several labor agreements that have been approved by counsel in the last year or so that have built in over three years increases, which range from 3% to 5% depending on the bargaining unit. And so those are built in there. Also, it's not only salary but the benefit costs, right?

So with the increases in health, well then the city has a portion of the health. So whenever you see kind of increases there, those get built in and those are a little bit less within our control because health costs will rise as health costs will rise. So that's kind of another factor there. So that's just kind of in terms of personnel, there are various levels of increases depending on kind of the bargaining unit and what was negotiated there. And when you look at the department year over year growth, that is not all kind of personnel.

That's multiple factors. So in many cases, we have contracts built into the budget, which have inflators because as part of a contract that we have with a vendor, they also have CPI growth sometimes built in within the multiyear contract. And so some of that is basically the non personnel that is also growing. And it varies by department because it varies by kind of different contracts that departments have and those different functions. So that's why it's not an apples to apples when you look at every department in terms of that growth.

Some are very personnel heavy. Others have personnel and contracts. Others have personnel contracts and equipment. And so it just really kind of varies. So that year over year comparison is a little bit more difficult because of the fact that they're not similar in many cases.

So I just kind of note that as one of the reasons why things are changing. But when we are looking at the proposed reductions and working collaboratively with the departments, as the city manager mentioned, that is one of the things that we were trying to be mindful of percent of budget, not also kind of overburdening kind of one department but at the same time being mindful of where there are opportunities to reduce because of either savings or because there's kind of other fund sources available to offset some reductions.

Okay. Yeah. And I mean I just noticed that some of these increases were also like due to travel as well. Like I'm just wondering what the prudence of that would be. I I know that there are important things going on, but, you know, we still do have things to take care of at home.

And so I I would just wanna, I guess, just make a remark about that that it just seems concerning at least to me that if there's not, like, just general salary increases and, hopefully, like, salary increases, you know, could also, you know, match that if there are not any, you know, preordained agreements with labor, you know, taking that into mind, but also just making sure that, you know, some of these departments are not, you know, living above their means when it comes to some of these, you know, non personnel expenses that they might be using. Okay. So thank you for that. So the next question goes to personnel non personnel costs. So I noticed that in the budget, in the general fund, the expenditure line item decreased by, 15% in the first fiscal year, and then in the second fiscal year, 2728, it's going back up to 6.1.

Do you have any insight as to what that increase or what that decrease was for that expenditure line item and then why it's going back up 6% in the next year?

Yes. So many of the cost reductions are built in within the non personnel. So a lot of those hit the non personnel category. So that's one of the pieces. Another piece is one of the reduction strategies or I guess deficit solving strategies that we have is tied to the general liability trust and basically using some one time funding to offset the need for the general fund to contribute to that trust. So that is built into non personnel and that's only a one time adjustment. So if we go back to the solving the deficit, I'll be able to show you what I'm referring to.

Yeah, thanks.

So you'll see here the use of unassigned fund balance and the general liability trust fund true up. Those two components are in essence they're offsetting what would otherwise be a general fund transfer to the general liability trust. So by using both the reserve and then using the other funds to basically make their required contribution on a onetime basis, that artificially makes your non personnel look lower. That's why in the first year, there is a big decrease compared to the current year. But then you'll see in this chart, in the second year, you don't see those, right?

You only see 3,900,000 versus the first year is closer to $9,000,000 So that's why year over year, well then the second year doesn't have that same reduction. It has a growth. So it's more of a factor of one time sources that are used to adjust the budget, which are just captured in that row.

Okay. And again, for for for non personnel costs, I I guess so what what encompasses that? Is that that's like third party contracts, vendors, and and maybe travel as well?

Like what encompasses utilities. So yeah, I mean, the contracted services is a big piece of that. Travel, utilities, so water, you know, gas. That general liability kind of trust is transferred, is captured in within there. But basically a lot of contracts that departments have, parks for maintenance of parks, right? Kind of all those types of contracts are captured within non personnel.

Would you have an estimate as to, you know, with the different contracts that these departments have? Which ones are are critical to the their actual services? Like, which of these non personnel costs are are critical that they that they need to outsource outsource that cannot be pushed in house?

Well, think as we were looking at the cost reduction and working with departments strategically to identify what possibilities there were, I mean that's kind of one thing that you know departments are asked to identify what things could be changed or modified that would not have kind of a core impact of service? And so if there's things that did not have a core impact of service, then those are things that we kind of talk through with departments. But kind of in many cases, contracts are sometimes actually cheaper than bringing certain things in house, right? And so from a cost reduction strategy, that doesn't always serve to the benefit. Now you could eliminate contracts but then that's a reduction in service. So we're trying to be mindful to try to not have reductions in core services as much as possible as part of this plan.

And which which department is or what are some of the key departments that are driving some of these outsourcing for for some of their services that that they provide to the city? What are some of the key driving departments in that?

I'd have to give you a breakdown of our non personnel by department. I don't think I have a breakdown of by department. We we have them. I don't think I have one with me. But, we have breakdowns of by department how much each gets of that category.

Yeah I think that would be helpful and I should I think that just going forward it would be helpful to have just a subsidiary breakdown of non personnel costs and what that actually looks like even if it's long, I know it's it's unfortunate for, the trees to print that much, but I think we have more trees now than we did a hundred years ago. But I think that would be, important for for additional context so that we can really get that granular level of detail. So thank you for that. And the last question goes to, some of the reserve drawdowns. I noticed that we're going to start drawing down significantly after we hit the 100,000,000 threshold, I think into the 2030s.

My question is, what is our reserve ratio right now for our reserves?

So in terms of our policy reserves, we're at 20%. And that's basically the the council adopt their policy to have 20% of the next year's budget as a reserve. And so going back to the kind of first slide that has all the reserves leveled out, we kind of break them out by the policy and then what we consider the discretionary reserves. Let me just scroll that real quick. This one.

So 76 is basically 20% of the last approved budget, which was $382,000,000 So this budget is $383,000,000 so still roughly about 20 there. And then the others make up the difference. And so I think you're referring to the unassigned balances, of the ones that we are recommending to use. And then the Section 115 trust, which the general fund portion is as of March about $97,000,000 and then that trust's kind of set aside was $18,000,000 So we're in essence planning to draw down on most of that trust set aside and then start drawing on the trust in year two. But under our approach, we have enough in that trust to take us through those peak periods.

Yeah. And after we get to those peak periods when we when we do those drawdowns, once we reach that point, after we start drawing down after the 100,000,000. Do you know what our reserve ratio would be at that time? Will it still be 20% or will we have to start adding more to our reserves at that point?

So generally, the way the policy reserve works every year we have to add to it in order to meet the new 20%. Because 20% this year will be different than 20% next year. So in essence, there's always kind of those like year end savings that then get transferred in to that reserve. So our goal is to always be at that 20%. Got

it. Okay. Yeah, I think that concludes my questioning. So I appreciate it. Thank you very much and thank you to all the departments.

Commissioner Benavides. Oh.

Thank you madam chair and I'm gonna applaud your early remarks madam chair. I interpret it as convincing or at least letting out to our leadership here in the room about the distribution of resources. What is it that is lacking in our city? And so I applaud your comments, and I hope it doesn't fall on deaf ears. Chair Vandenberg, you mentioned a few things.

The language that was in the ballot measure in which our electric electorate approved eight years ago, give or take. He also mentioned the simplification of letting our community know how our cities run financially. In my travels from Wards 1 Through 7, talking with to different people from different backgrounds and affiliations, they speak about the day to day things that that they encountered and going to work, maybe two jobs, feeding families, dealing with a high cost of this, that, and the other thing. And now they're gonna be asked to tax themselves again. And I'm neutral in regards to the ask.

Mister Ira, you spoke about surveys and the small percentage of people who respond to such surveys that that our city uses and acts upon. That turnout has been consistent for several years. There is a disengagement going on in our city. But it with all that said, I feel honored to be in the room with all you good people out there. You worked very hard in doing your job.

Yes. You're you're compensated nicely. And when you retire, your work and efforts will also be recognized. That doesn't happen out in the real world as much. I run a nonprofit, what, 35 employees.

Our reserve I was told a long time ago in the in the nonprofit world, if you have three months worth of money in the bank to cover your operating expenses, your personnel, your indirect costs, that's good. And we've used some of our reserve funds just to meet those expenses. It's a different world, but it's still the same cost that a city has. Safety, personnel, operating, etcetera. And and I bring this up because, again, our community is hurting.

And and but in regards to measure z, I'm gonna be honest. I'm I'm a bit troubled on what I heard today and have been here. This body here a couple years ago recommended a half $1,000,000 of z funding to support seniors and people with disabilities, which, mister vice chair, you read a few minutes ago. And when we asked from this body to leaders, how much has been spent on these populations since the beginning of z, And it was zero, which was troubling. But this committee did vote and made a recommendation to counsel to put a half $1,000,000 a year for this population, which is literally pennies on the overall z budget.

So when that was passed and the city implemented a program for seniors and people disabilities, my office took a look at what was being offered and met with folks from Parks and Rec about what the money was being used for. Double trouble. Because what I discovered, or what we discovered, was that those dollars were being used for recreational and therapeutic programming for this population. And being in the business for twenty plus years, if not more, and living with a disability myself, recreational opportunities below in our hierarchy of what we will use with our precious dollars to do the work. People with disabilities wanna do the same thing that we all try to do in life.

Work, contribute to the community, raise families, gain generational wealth. So I must say, my thought, and this might have been my bad for not being a little bit more assertive when we did recommend to counsel, that we have many people out in our community that run businesses, that have experience, expertise, knowledge when you deal with people with disabilities. That's not happening with our measure z. And moving forward, I think that needs to be addressed with with more dollars, but maybe providing it to those expertise that's out there in our city that provides direct services. Couple the last thing I'm gonna say about that is a couple years ago, some of you were here in this room, where we raised the disability flag outside.

I was asked by the mayor to make a comment on that special day. And flags, symbolic gestures are nice, but they don't and it doesn't address the programs that are needed to serve this population. So when our measure z a recommendation was cut, it it just doesn't sit well with the community. And so but no reflection on staff, the leaders that are in this room, like I said. But what I hear out in the community is different what I heard from this survey.

So that's those are my comments from there. But I whoever wants to answer this question, I'm gonna shift gears to what I heard about the office of the inspector general. 65% of the electorate felt that it was need mostly highly needed. Granted, it's been a couple years almost since that measure was passed, but I do understand that such takes time. But I heard that in the budget for the next two years, three FTE positions are being proposed for that change to the way our city government operates.

How was that determined? Because it was my understanding as the chair of charter and working with my colleagues that this department was going to be separate from the city manager's office that will report directly to counsel. And that that department will be responsible or actually the IG, he or she would come to the to this position and determine how that department will look like. I didn't hear a dollar amount, but I do remember being at a council meeting where they proposed about $700,000 for the first year. And then similar for year two.

In in running a business from the ground up, the first few years didn't have that kind of money to do that work. I would predict that year one of the IG, whenever that begins, may not spend that money. Because it's gonna take time to recruit and hire, set up the hierarchy of the department, all the standard operating procedures that's required from business that starts from the ground up. And so, you know, so my question, and and I apologize for going beyond my three minutes. How was that determined that our first office of the inspector general will have three full time employees?

Thank you, commissioner. Mike Vitrell, city manager. I I your thoughts and statements are well received, and I think you're actually on the right track. The office of the inspector general will not be part of the city manager's office, and I will have no part in direction. This inspector general works for the council.

I think it's important to remember that the budget is a prediction. We think this will happen, and I think at you've seen us at every council meeting, we adjust the budget. Almost every council meeting, there's some item adding, moving money because it is a prediction. We think we know what revenues will be. We think we know what expenditures will be.

So we have just made a prediction on the startup inspector general's office. And I think you are correct that once this person is selected and on board, then that person will design a program, do the startup activities you described, and then we'll come back to counsel to better shape what the budget for that office really looks like. But we needed to put some money aside recognizing it won't be zero. So let's put some money aside, and when that person comes on board, they can build the office, and we'll go to counsel to shape the budget accordingly.

Thank you, Mike. All for me, madam chair.

I have a So when Measures Z was presented it was almost like, oh this is bonus money, for the voter. So that's kind of I think the perspective maybe many took was that this tax is gonna be like a really great bonus for these specific things. If we don't have Measure Z again like what is the city going to look like? I don't know if you can answer that today but at some point maybe you could share with us what the city would look like if there is no measure z and also if there are current on if there is there a way to know by ward what the measure z revenue is what that tax does per ward? Or how much each ward brings in?

Is that revenue?

Yeah. Or both both makes sense.

Yeah. Like how much does each ward bring in? I know ward one probably brings in a lot because of FOL. But I'm very very curious because then I would like to see and find out how is it being spent in each ward and is it really going to the services in those wards, very specifically. I'm curious I didn't even think of that till just now but I've also realized that this being my fifth year I've never heard anybody present to the commission what each ward brings in.

There's one representative from each ward. There used to be two, one business and one residential. And then each of us is represent represent the council person. So since this is very ward specific, I would love to see the specifics of generals, measure z, I said gen z. Of measure z, in each ward. Thank you, that's all.

I'll let you answer the second part of that but I will say the first part of what would be the impact of not renewing measure z, city attorney has counseled me that we should not answer that in context of a pending ballot measure because that may be deemed as suggesting people view vote yes or no, and we are limited by state law on what we can say. Mhmm. So check back with us after June 2 and we'll be happy to give you a frank opinion of what would happen to the city finances should at some point measures e not be renewed. But as to the second half, I defer to our Deputy Finance Director if that's possible.

Yes. I think we actually do have an ability to have our sales tech consultants that geocode by award. I know they geocode for different areas already. So might take some time to work with them to do that. Now we cannot provide breakdown by business. There's confidentiality restrictions. But we could probably geocode the award and try to say how much say in the last fiscal year, how much they brought in. We could work with HTL which is our consultant to see how long it would take them to do something and then maybe we could bring it back in the future BC committee meeting commission meeting where we could just kind of give the breakdown of that.

Thank you. I think that would be really helpful to all of us. It's, who would have thought, right? Thank you so much. Oh, Commissioner Ira.

Thank you chair. Yeah, echoing the chair's comment, think that would be awesome to see, you know, revenue that each ward is generating, but also where the money is being spent and which wards need additional assistance, which wards don't. I know in talking to folks on the Western side of the city, they often feel like, you know, not saying it's accurate or not accurate, but the feeling is that less less is spent on the you know Ward 6, Ward 7. So it would be great to kind of address address some of those concerns and have the data for it. What I wanted to just flag was that I know we have a timeline of the proposed budget being brought to this commission next month for our next May meeting.

Am I understanding correctly that we would be basically voting to approve and send this proposed budget to counsel at that time?

Correct. We'll bring forward the full proposed budget. Right now it's just a workshop for General Fund and Measure Z. But as we do with all the quarterly reports, bring them to BC and then you forward a recommendation to counsel so that would be the similar step for the budget.

Got you. Okay, well that's helpful to know because today would be the day to front load some of our perspectives, opinions, agreements, disagreements with the budget in anticipation of that being proposed at the next one.

Yeah, you could take the formal action at the next commission meeting.

Okay. The other thing I wanted to just flag was this, again, beating,

What is it?

Dead horse?

Well, I

didn't want

I was fine. Trying to find another another way to say that. But not to belabor the point. But I think it would be really great if we could really promote maybe just even with the social media post or whatever the next budget commission meeting. Because I think for today, unless I'm mistaken, I think we only got one ecom in.

And it was related to measure z and not really to this specific discussion. So it'd be great to have at least five, ten people in the room who would show up to that meeting and provide some feedback as members of the general public. I don't know if we can we can work with staff to do something like that and just promote that the proposed budget will be happening in a public forum. Folks can come by. Maybe making it clear that this is not This is just for the proposed budget and not for other ancillary issues.

But I think that that would be great. And that that meeting we can kinda have the community input and then the discussion on the commission before approving the final proposed budget that we sent to council. So if we can, I don't know if there's, maybe we can recommend that as an action as a commission? I don't know what would be the most appropriate way to do that. But I think it would be a miss if we had no one showing up to our next meeting from outside of city staff and such.

Yeah, I think we could take that feedback and go talk to kind of marketing and comms team just to see maybe press release or kind of something else just to spread the word on the next one. So we could take that, the comment back. I don't think you need any formal action for that necessarily but we hear you. Instagram story video, Sergio? I've been on a couple already so maybe I'll do another Instagram poll.

Yes, please, Sergio. I've been saying this for forever because a lot of the people in our community do not know what measure z is and I'm not talking about young people but there are adults that are contributors in our community that have no clue what Measure Z is and I explain it to them and they're like, had no idea. People just they don't know and that's no fault of theirs but also as commission like with commissioner Iyer I've been asking for years you guys could make it look cool and get people to listen and hear and get the engagement especially you have little kids playing video games so they're your next wave of voters you get them when they're young you make them feel cared for and invest in them they invest in the community and the community is stronger. Stronger. Okay.

Thank you. And, Commissioner Ward.

Chair, sorry.

Yes. I'm sorry.

I hadn't had a chance to just I had two really quick comments that I was part of my So, next meeting, just in I know I had brought up that, you know, there is opportunities for us to make proposals. Or I would just flag, and I don't know that we have time to take a full commission action. But a couple of things that stuck out to me that I would like to see potentially removed as a cost reduction or or not have as a cost reduction. I did find it a little concerning that we're reducing funding for Spanish interpretation at council meetings, committee meetings, other public meetings. And also, reducing funding for a Funding for ASL interpretation.

I know I have a large deaf community here in the city of Riverside. They're very active. I know they have a commission. I know they come to meetings. Just flagging those as two things that really stuck out to me. And I would hope that maybe we can find ways to cut funding somewhere else. And again, if it's something that's not gonna be impacted, maybe if you could clarify there. And the other thing was actually, there's a whole list. So maybe I'll just come to the next one with yeah. Because there were some that I saw that I I thought were really concerning.

I would love to bring those maybe in a type form or something just based off of the document you gave us. Because I really think that's why I'm really emphasizing we bring the community out to the next one. It would be a shame for us to approve that. Send it to council thinking that, you know, we were voting in the best interest of the community. And then we have a lot of push back saying why was ASL interpretation cut? Why were street paving stuff cut and so on? So that's finally the end of my comments, so thank you.

And then just make a quick comment on the interpretation.

Yes, thank you.

That really is not a reduction to the the service. When we looked at the actual expenditures that the marketing team has been spending on their contract for Spanish interpretation and then the new ASL a funny they provided, they were spending less than budgeted. And so this basically just does a true up to bring the budget level closer to their actual expenditures, but we wouldn't anticipate it to result in an actual reduction in translation services itself. So this is just the first step is where could we just align with actual expenditures. This is one example of that. So we wouldn't anticipate this to result in service reduction.

And if I can just emphasize that because we talked about that a ton that people would misunderstand this. This is one of those examples where two or three years ago council said we want Spanish interpretation. We want ASL, but we had no idea how much money to put in the budget, so we just put a big number. Now, we've got a couple years of data. We can say, oh, we put too much money in the budget. Let's just right size it. So there's no cut in services. It's actually a more informed decision, but without an explanation, and thank you for bringing it up, people might think differently.

Thank you

for the clarification. You for the clarification. I stand corrected. I think what might be helpful I do promise actually my last comment on this, but if we can get maybe a small column saying like service impacted, service not impacted for the next one. Because I think, you know, in my understanding of it, it was like, okay, they're cutting, and misunderstanding. Mhmm. They're cutting ASL or they're cutting Spanish translation. Obviously, that's not the case. I'm assuming member of the general public would make potentially a similar misunderstand similarly. So, we can just have a column that says this will impact services.

This will not impact services. I'm assuming a large part of the list based on what you're saying is gonna be not impacted, just true up. But if there is something impact that I think the general public should know and it should be easy to understand, less confusion. So thank you.

Chairperson Williams. Yes. May I just address an issue?

Yeah.

So in our agenda item, as far as the Brown Act, what you can take formal action on is limited by, you know, what's been agendized. So even though it's a workshop, you have agendized the recommendation. And you can make recommendations to staff related to Measure Z. So if you were taking a formal action that kind of fit within that, you can do those today. So, I just wanted to kind of make sure I clarified on that point.

Sorry for interrupting you, Commissioner Ira. And Commissioner Ward.

Yeah, I think this will be quick. I just had a question about AI and personnel costs. Obviously AI is evolving and expanding exponentially. I just wanted to know what some of the city initiatives are for AI and how that relates to some of the increased personnel costs and what we're doing to streamline. Hopefully not impacting too many jobs, but as we look into the future going forward as we consider new personnel hires, how are we going to use AI to kind of streamline some of the work that we're doing to match industry standards?

Great question. Thank you, Commissioner. George Galil, your Chief Innovation officer. We have a couple of different initiatives we're using AI for right now. We implemented Microsoft Copilot.

We have, I believe, about 50 professional licenses that's kind of fully integrated within the Microsoft Office ecosystem. Probably, it's costing us about $30 per person per month. And that's for general productivity. For improving efficiencies, we launched Rivi, our AI, that you probably have seen We're a lot about using it to really help our team catch up on backlog and improve service delivery. So Rivi's serving roughly about 500 transactions or so on our public website responding to public questions.

We integrate it within our phone system. It's doing, I believe about 10% of our daily call volume coming into 03:11 right now is being answered by Rivi and being available a 20 fourseven.

What, sorry, what percent?

About 10% of the calls coming in.

That's good.

It's being augmented, but it's also, it's really helping our team provide the excellent service even 20 fourseven. Our call centers are open during business hours, but Rivi's answering those calls in the evenings as well. We are getting close to going live with integrating it fully within our three eleven system to be able to open a service request or check the status on the service requests. Working really closely with our public utility team and we're close to pulling the trigger on that. In addition, we are doing the pilot right now for trying to improve account payable processing, for example.

So we do have an outdated and older financial system. So we're trying to be creative and innovative on how we can leverage some of modern capabilities and new financial systems without the $10 plus million investments. Shout out to our innovation team. They built an in house tool using AI that can scan invoices and process it. We built it completely in house. And we've done a pilot right now and we're able to process I believe about 200 invoices for less than $10 in about fifteen minutes. So there's more and there's a lot of, we have a lot of really smart folks that love to serve the city and see how we can support our community and employees.

Yeah, that's really encouraging to hear. Think just some subsequent remarks from that that I'll make is with the inspector general. I know my fellow commissioner to my left has been emphasizing this for a long time, but I noticed that one of the full time positions there was a performance analyst. You know, maybe I make a recommendation that, you know, maybe a position like that, if it's like an entry level position, be frozen. I think that, you know, the inspector general himself or that other program manager could probably come up with some performance, you know, with a few prompts.

And then maybe that maybe like a one time expense could be used for that line item or maybe two for two years to maybe, actually go contract a service to see how the inspector general's office can be better utilized in terms of doing financial audits and how a consulting company could help with that rather than having just a full time position there that we're locked into. So that's number one. Number two, three one one app, I use it not as much as I should. I just wanna make a technology recommendation is that the UI on there is is not ideal and I wish that we could maybe update that because I'm sure that a lot a lot of users get bogged down with the complexities of that and just with the poor UI interface. Apologies.

But just wanted to make that recommendation. So thank you very much. It's really encouraging to hear overall some of these initiatives that we're doing with that.

Appreciate it. And a quick update. So the three one one app, it's about 18 years old, is our three eleven system. So back then it was cutting edge. And some of the, and as you have seen, some of the reserves, $5,000,000 technology reserves that was forward looking to be able to modernize a lot of So our three one one system, there is an upgrade process. There's an RFP being developed to modernize our three one one system as well as our asset management system and those reserves are going to cover that.

Yeah. I think that is a good strategic use of reserves because if we have more three zero one one requests, then obviously, you know, our roads, some roads that might be missed could be repaired sooner. And we all know that if roads are not repaired as soon as possible, then the degradation of that means increased costs. So I appreciate that. And lastly, you're good. Thank you, Mr. Khalil. And lastly, I just want to emphasize some remarks have been made about where we should be going in terms of our investment with Measure Z, in terms of our overall investment. I just want to reemphasize that we should continue to invest in our infrastructure. It is poorly underserved.

We have seen time and time again, remarks from public works that we are well behind the eight ball. I think it's a five alarm fire in my book. So I think that we should really be strategic in how we allocate going forward so that we can maintain the level of our roads, and improve the level of our roads, not just to maintain. And then with regard to Measure Z, just wanted to make a comment again that, I understand the the importance of of dealing with fire and we should and I'm in support of what that ballot measure would be. But, just as a general, expression of of my point of view, we need to continue and I know that we are doing this.

But I think the public should really understand the importance of economic development and how that relates to not being put into this position every other election cycle where we have to face that tough decision of increasing taxes as small as it may be. But if we had just a better foundation for economic growth that is, not just you know with startups. Know that my colleague Mr. Randenberg has talked about this before. That's not just startups but established companies that have reputation, then I think that we would be in a better, you know, fiscal position going forward.

So, I know I know we're I know we're working on this. I know the city understands that but if someone's out there listening, maybe that gentleman right there, maybe we can take that position going

forward. Thank you.

Commissioner Benavides?

Yes. Two quick. Thank you, madam chair. Two quick items. Arameen brought both of them up. Interpretive services and community engagement. About eighteen months ago in this very room, I believe I counted six because I spoke with them. Folks from our community came to listen and participate with the Budget Engagement Commission. We didn't have quorum. So that didn't help.

Interpretive services, and I love speaking about things that have happened so we could learn from them. On Tuesday, the mayor felt obligated to limit public comment to forty five minutes. I found out later on that that was done because there was no interpreter available that Tuesday afternoon. And I thought, that's interesting. Since it's just happened, I haven't had enough time to think about it, but that's what happened.

And the city and I know staff, you guys tried very hard to get the public to respond, engage all of our boards and commissions. I think I've gone to, like, 13 or 14 of them over the past couple years, and sometimes I'm the only one there, and sometimes there's no one else there. There might be two or three. It's a difficult thing. Whether we have a 01:00 city council meeting, a 03:00, 06:15, or a 05:00 budget engagement commission on a Thursday.

And now we I thought and the city manager said this, we don't know. We don't have crystal balls. What about Saturday? Again, I throw it out there because the times that I've mentioned throughout the week that happens in this building here, we don't get that many folks that vote and approve and dig in their own pockets to show up. So I think my my theme is gonna be why not Saturday? That's all madam chair.

Thank you so much, commissioner Benavides. Sergio, do you have a update for us from the Deputy Finance Director?

Yes. Just a couple quick updates. So one, last year the BC had approved a recommendation to go to City Council related to the reduction of the BC membership phased in. And so just a quick update that we did take, I believe last week and there's going to be a second report that goes to council in a couple of weeks to bring it down to 10 given that there's three additional vacancies. So I think in the June meeting, that's when the quorum threshold comes down again slightly just given that we would be eliminating the three existing vacancies.

So just a quick update there. And then one additional thing, although we cannot speak about necessarily the new Measures E, just want to make sure you're aware that there's going to be community forums that are scheduled for April 16, April 30, May 6 and May 21. And that is to learn about the upcoming election and also the ballot initiative. We have that information on our website. There will be community meetings spread out throughout the city. I could send it out to the commission so you have it but just want to make you all aware. That's all, thank you. Thank

you so much for your presentation and all of the answers and for you all sitting there. Future items on the master calendar. In May we have the quarter two presentation, the proposed budget and financial indicator for June and July, the cannabis update and quarter three and October measures the engagement requested by Commissioner Langner to be determined. And is there anything a commissioner would like to add? Where, oh my gosh. I'm like, circle around, thank you, PAC, after I look. Commissioner Ira.

Thank you, chair. Just super quickly, wanted to mention again if we could get city staff to promote the next budget engagement commission meeting. I think that would be great. In addition, I think it's awesome that we shared this here, but if we can share the measures, the informational meetings on social media. Just to check that box, let folks know that that's out there.

I know there's a lot of strong feelings one way or another about Measure Z and it would just be good to have folks plugged into these. The last thing I will mention is childcare. I brought up childcare at the previous commission meeting and assessing what the city is doing about childcare costs. I believe I shared the information with the nonprofit that I had mentioned that works out of a city facility. Their contact information for the city finance department, I'm not sure if they've reached out, but happy to reshare and keep that conversation going.

I think it would be a prudent discussion for us to have. And then last thing, I know I mentioned revenue generation. If we can put on a future workshop agenda just like revenue generation in the city. Like what we're doing to create new sources of revenue. How we're looking at bringing new revenue into the city that doesn't necessarily fall on the shoulders of taxpayers. That would be awesome too. Thank you.

Commissioner Vandenberg.

Thank you. I don't know if this needs to be agendized or if you're just gonna email the information. I was still looking for some gaps, the youth services funding, seniors and people disabilities, just specifics on how much has been sent spent. And one item I would like to have agendized, but it would need to be quick because it would need to be on next month's agenda if we're gonna get this in before the vote happens. We're considering making measures e permanent.

And I'd like to clearly show, number one, what accountability measures are currently in place and how would those apply if the tax becomes permanent. Do we do we lose any safeguards? Right now, there's there's accountability to the taxpayer to actually extend this in ten years or eleven years when it expires. If we make it permanent, do we lose some of those safeguards? I'd like to just have kind of a clear indication of what do we have in place now and how does that change if this becomes permanent accountability to the taxpayers. So that's a question that's brought up that I think is an important one to discuss before the vote happens. Fair enough. That's all. Thank you. Commissioner Ward?

Yeah. And I think I'd like to add to Commissioner Ira's idea about what revenue, strategies we're pursuing. I would like to see what our our pitch deck is for large companies, what that looks like. And I would like to see what our activities look like when we go to conferences like ICSC. I just I'm just curious like what what we're showing in terms of our overall story. So maybe that would be, helpful for for that discussion. Thank you.

Alright you guys. Thank you commissioners for showing up. Thank you all of you. The next budget engagement commission meeting is Thursday May 15 at five p. M. Thank you all.