City Council - Regular Meeting

I call this work session meeting of the San Marcos City Council to order. Today is Tuesday, 05/19/2026. The time is 3PM. Miss Trevino, let's see who's here.

Mister Rodriguez. Here. Mister Bussel. Here. Miss Garza. Mayor Houston. Here. Mister Scott.

Here.

Mister Mendoza. Here. Mister Gonzales. We have a quorum present.

Alright. We will start with citizen comment time period. The council will hear comments at regular meetings, work sessions, and workshops. There is a sign up process. If you're online, please when it's almost your turn, you'll see a pop up question on your screen and you will need to respond to that. Speakers may speak once during citizen comment time period, may not yield time to others. When it's your turn to speak, state your name for the record, even if I had just said it. You'll have three minutes. When you begin speaking, the timer is in the green. When you have twenty seconds left, the timer will only be in the yellow and you'll hear a little ping sound.

When your time to speak is up, the timer is red and a bell will ring. Mayor and council will endeavor to ensure that meetings are conducted in a courteous manner and in an atmosphere free of defamation, intimidation, personal insults, profanity, or threats of violence. If you do any of those, you will hear the gavel and I will ask you to leave the council chambers. This is your warning. We've got two people signed up this evening as Guadalupe Serranana, I think is perhaps how it's pronounced. Is that person here? Maybe we'll see them later. And Maxfield Baker, is he online? Alright. Mister Baker.

Oh, I did not realize that was my background. There we go. Great. Yes. Thank you.

My name is Maxfield Baker, and I'm a little sick today. So I apologize if I'm don't have if you can't hear me very well. But today, I wanted to show up and talk about something that the San Marco Civics Club has been working on for a while. When we first started in June 2023, we were dead set on making our San Marcos Local Government more accessible and more transparent. As a part of that, we really wanted to encourage people to serve on more boards and commissions.

And we immediately got to work compiling a list, and kind of doing our own little audit of our boards commissions, especially as they're presented on the city's website, which has historically been a frustrating point of contention for everybody. As I started going through it again back in January '23, we found a bunch of issues, some inconsistencies, and we reached out to the city clerk's office, and city management, city city manager and stuff, and basically said, like, hey, y'all. This isn't looking very good. We've put together some stuff that maybe will help you all fix it on your end to, again, make it more accessible, more transparent. And then we were effectively brushed off.

We never heard back in a satisfactory satisfactory way from the city clerk's office that they would endeavor to fix any of these inconsistencies or some right just false information. We have picked up this project again this year and in doing this audit have confirmed that none of those changes we recommended previously were taken in good faith or endeavored in any way. And as an example, if we're trying to get people to serve on boards and commissions, the most important part is knowing when those meet. When we looked at the Human Service Advisory Board, the posting online still said that they met on Thursdays for two months out of the year. I mean, it was really clear from the agenda postings that they are now meeting on Wednesdays and that they meet much more than just two months out of the year.

And so, you know, we, having sort of hit a dead end with the city clerk and city manager's office, have started to reach out to the staff liaisons for those departments and those boards and commissions. I was thrilled that Carol, I'm forgetting her last name right now, very quickly reached back out to us even after hours to correct the human service advisory board changes and noted that, you know, it might have been an issue of communication between their department when the board voted to change that time. Can we oh. Conveniently, there's also a calendar on the website that is also out of date, missing information about the library board commission and other commissions as well when they meet regularly. So we're just asking for the city to reach out to us and help us work on this to make it more accessible and more transparent and encourage more people to serve on boards and commissions.

Thank you.

And those were the only two that we had signed up. So now we will go to item one on the agenda.

Receive staff a presentation whole discussion regarding the preliminary fiscal year twenty twenty six, twenty twenty seven budget and related budgetary considerations and provide direction to the city manager.

Good afternoon, mayor and council. And before I go into my talking points, I would first like to introduce, director of neighborhood enhancement, Shanna O'Brien, who is with us, newly appointed in her role. And then also Robert Good, who is with us as interim public services director. And so I wanna welcome them both to the team and very thankful to have them as as part of, this process as we go through and look forward to their leadership and working with them. So without further ado, we're gonna start off today with a presentation with an update on the fiscal year 2026 budget and related budgetary considerations.

We do this because when we get further into the process in June, we wanna make sure that we've given y'all some previews because by now, we've received the preliminary certified tax roll, and so it's important for us to let you know what those numbers are looking like. So the process began with city council and directors coming together at your visioning session in January to discuss our strategic plan and develop priorities for the next year and continue with the budget policy workshop in February. City council then adopted the budget policy on 03/31/2026, which provided staff with guidelines to follow as the budget is being developed by our departments. This work session will provide an update on how the FY '27 budget is coming together as of this moment. The FY '27 budget will continue to be refined as more information and guidance is received and as we move closer to the June budget workshop in August 18 when the budget is submitted to the city council.

And by then, we will have a certified tax rolls so we'll know final numbers that we can count on within the coming year. I would like to thank our directors team and our fine and who is all are they're all here today to show their support and also to be available as a resource to all of you. Specifically, I'd like to say a big thanks to our budget and finance team for their time compiling the information before you today. I'm now gonna turn it over to finance director John Locke to give you the presentation. Thank you.

Thank you, miss Reyes, and thank you mayor and city council. We'll begin with just an agenda of everything that we're going to discuss this afternoon. We'll start off by looking at our budget calendar and where we are on that calendar to date. We're also going to talk a little bit about economic development. And Helen Ramirez, the Director of Economic and Local Business Development is going to cover a couple slides as we through the economic development section.

We're also going to discuss some economic indicators that are important to consider as we look forward to the fiscal year 'twenty seven budget. And most of the presentation will cover the general fund. We'll cover the two largest revenue sources, the property tax and sales tax, provide an update on the general fund forecast, and some closing considerations for the FY '27 budget. We're also going to provide an update on where we're at with the community benefit charge. And then, Destination Services, Rebecca Ibarra, the Director of Destination services, will provide an update on the department's name.

So, this is a look at the calendar. We are about midway through the calendar. This is the workshop where city council will receive an update of where we're at primarily with the general fund budget as well as the capital improvement plan for fiscal year twenty seven. As you all know, have received a preliminary role and we had some information included in one of the sales tax updates. We included some property tax updates in with that.

At the next workshop in June, that's when city council will receive more of a draft budget for all of the funds. As Ms. Reyes pointed out, at the end of July, we'll receive the certified tax roll. Right now, we're just working on preliminary numbers. And so there could be some tweaks when we receive that certified tax roll depending upon where the numbers come in, the final numbers on the property tax roll.

August 18 will be the day that the budget is submitted to city council and on that same day city council will set the maximum tax rate that cannot be exceeded for fiscal year twenty twenty seven. And sometime within the next couple of days after that day, we'll get back with the neighborhood commission again and provide an overview of the fiscal year twenty seven budget and get their feedback as well. There'll be multiple public hearings on September first and fifteenth. And the fifteenth is the day that city council will consider budget adoption and tax rate adoption. So, at this time, I will turn it over to Helen Ramirez, she'll go through the economic development slides.

Helen Thank you, John. Good evening, mayor and council. What I like about our approach to economic development is that it includes local business. And that's specific in our title. Typically, you see in cities is they don't necessarily put that emphasis in there.

So, I want to really emphasize that, the importance of diversity in our tech space, whether you're small, mid sized, large business or micro business, you're important to the city and it's important to support and attract new businesses. We want a mix of our ecosystem consists of residential, commercial, industrial. And so, really want to be able to have a good ecosystem and a mix of commercial and targeted industries to be able to reduce the tax burden on our property owners. As we know, the the amount of property tax that is paid by our commercial commercial development or industrial development yields a higher property tax than a single family residential home. So, you really want to have that mix of land uses that support that.

We also want to ensure that our incentive strategies align with our values. What are our community values such as health benefits, childcare, livable wages. We want to ensure that our future generations want to live, be educated here and stay here and raise families here if they chose choose to do so. We also put a large importance on downtown. Much of our downtown has the highest density in our city.

And so, that's where we see a lot of our small businesses that therefore the emphasis on Main Street and the downtown tours. And so, with that we also ask for patience because new development takes time, not only through the permitting process, but also, which is an important process, but also construction, right? And then delivery supply chain. So, when we see, we have Buc ee's, HEB, downtown hotel that is coming, you know, those take time, but we want also a product that we can be proud of that adhere to performance standards. So why economic development?

Many times it's a tool to accelerate our economy, right? And it also can lead to more employment, a diversity in the employment that we have for, you know, different types of industries. And, they also, I said, lessen the tax burden. And, also, they support if there's a new business coming in, many times they need the supplies. If I'm a residential builder, what do I do? I look at the exact the existing supply chain of the city. Do I look at a building supply, a construction supplier? Do I look at an HVAC supplier? Is there a supplier of doors? Is so the whole when we have new businesses come in, they support our existing local businesses as well.

Part of our strategy is also helping existing legacy businesses that can be twenty years or more, and also our existing businesses, do they want to grow, how do we facilitate that growth? If they're also in trouble and they need support from the city, how do you best support them so they can continue to be successful in our city and do not choose to move to another city or close. So, it improves also the quality of life by bringing needed amenities to city from recreation because we want to also emphasize that some of our tools and economic development, it's not only for what traditionally we see as advanced manufacturing or distribution. It is also recreational amenities, tourism, what that enhance our quality of life. So it's that whole ecosystem that we're trying to build.

I love this picture because it really, it's a picture of a business in downtown, the Thirsty Planet. There we celebrated, many of you were there and supported, and many of our directors were there, our chamber. So, was great to see our local business community come together and support the opening of a business, its expansion and distribution. But also was the day that we launched our business survey. We received over 90 responses.

It was launched in April, mid April, and it just closed on Monday. And so, it was great to see now we're reviewing all the data and the feedback that we're getting from existing businesses and how we can best serve them. But basically, goes in line with our values. Public improvement districts, as you see and listed in the toolbox, does also include affordable housing. So, some of our strategies with regard to public improvement districts is also, what percentage of affordable housing can we include in that larger subdivision?

Is there a specific amenities, such as a fire station, where we would need land to be contributed to assist the service levels in our community? So, those are the things that these tools, whether it's a tax increment financing, a public improvement district, a chapter three eighty agreement, or entitlements, which is zoning, it allows us to work within those tools to diversify our economy and create an intergenerational workforce and a great place to live, by the way. Tax increment financing and many of the of the tips that you may be familiar with is our downtown. The tax transportation reinvestment zone is loop one ten. And and many of the TERs is that we use right now is to support the improvements to, for example, our historic downtown.

So TIFFs are great tools for infrastructure beautification, art, parking. So, there's different ways that you can use a tax increment reinvestment zone tool. Some of the benefits of TIFF is also accelerating our economy. While we keep a large percentage of it, a large percentage of it and the increment goes back to the boundary where we want to improve, but the city also keeps a portion of that property tax. It also can help with capital improvements and public infrastructure.

For example, we want better sidewalks, wider sidewalks. We want trails, better lighting. Those are the things that maybe can offset our capital improvement plan and allow for it to be financed through a different tool. Right? And this also decreases the cost of private development by providing reimbursement.

It's all reimbursement for qualified public improvements. So they put up the money first, and we reimburse them through the improvements that they make on property within our city. Not to go into a much slide, but basically the gist of it is I build a new building or improve a building within the boundary that increases the property value of that property within the city. And the increase that that investment generates, a certain percentage of it, 70%, will go back to the boundary to improve the boundary of the area, for example, tours, and 30% of that stays with the city. And so it's just that added value that they invest that then is regenerated to improve the boundary of the area that is located in.

And also, it's it's important to for the public and for our community to know that these are performance based incentives. If you do not meet your performance, then you will not receive the the grant, the waiver, or the rebate. So, that's very important that we work in conjunction with the finance department to one, ensure that the number of wages or the performance standards are followed, and up until that is verified by both the finance department and economic development department, that then we release payment. So, it's very important for our community to know that it is not fronting up money. It is once they have paid, it is the end we review their performance that they then are rebated money, or what have you.

And then also, that this reinforces what I'm saying in terms of the net benefits are sometimes it's wages, it's contracting opportunities. If they say you're going to work with a local business and give them work with them, and also if they're small and disadvantaged business, are they targeting it and are wanting to work with our local businesses? Do they value sustainability? Are they using lead or energy conservation in some of their practices? And so, there's many of those things that we also take into consideration where we also see that they're conserving and making sure that they're a good partner in the environment.

And also, I would like to emphasize that we do support small, medium, micro businesses, as well as large businesses. For us, customer service, despite what size you are, is very important to our city and our department. And also, we just want to cultivate a thriving community and a proud community that we are. And with that, I'll turn it over to John who will speak to our Finance Director on Economic Indicators. Thank you.

Thank you, Ms. Ramirez. As we begin our economic indicators, one of the things that we really look at is the city's population. As the city grows, the demand for services from the city will also grow. And at some point, you know, that demand to provide services is going to increase the cost to keep pace with that growth.

This is a look at the city's population that we used. So, we look through the forecasted numbers, these are the numbers that we use as when it relates to population. So, for fiscal year '27, the latest estimate that we have from the planning and development is 01/01/2026. So, that is the number that we're using for fiscal year '27. So, just a little bit over 91,000 residents.

Another really important factor is inflation. Just as inflation impacts all of us because $100 at the grocery store won't go as far today as what it did a year ago, it's the same impact on the city. The $100 that we spent for a service today isn't going to cover as much of it as what it did a year ago. And so what this chart shows is this tracks using the municipal cost index. It's just a it's similar to the consumer price index which is what most people are more familiar with.

The municipal cost index tracks the cost of the services that cities provide more closely and not necessarily household goods. And so, can see you can definitely see during the COVID timeframe when the inflation shot way up and now it's starting to it has come down. And because of some national and international issues, we're starting to see it creep up again. Just a couple of things on the slide to point out as a reminder, the 2024 actually represents fiscal year '25 because this is the inflation as of October 1 of that year. So, for 2024, the departments held their budget flat, and that year, the inflation was over 1%.

So, that was essentially a 1% budget cut, you know, to the department. And '25, it was 2.8%. And so, you know, combined that's about a 4% budget cut over those two fiscal years. And this doesn't take into account the inflation that we're experiencing right now because departments were asked to hold their budgets flat again for fiscal year twenty seven. And right now, as of March, the inflation was 3.9% just in the month of March.

So, if inflation stays that high, it'll have an impact on department being able to provide the same level of service. This slide shows the general fund expenses per capita. And all that means is that we're taking the total expenses for the year and we're dividing it by the total population, and that population being from a couple slides back. So, we look at the dark color on the slide, in fiscal year twenty twenty three, we were spending $12.34 dollars per resident. And if you go all the way to fiscal year twenty seven, we were spending $14.20 dollars per resident.

So that shows the increase during that time period. Another way to look at this is when you take inflation into account. So if you look at the lighter blue collar, in fiscal year twenty twenty three, we were spending the same $12.34 dollars When you go fast forward to fiscal year 'twenty seven, we're spending $12.00 $5 So we're actually spending less per resident today than what we were a few years ago. And long term, this trend is not sustainable because as we were talking about the cost of providing services is increasing and yet we're spending less money per resident. And so, we'll continue to see some impacts to service delivery.

So now we're going to transition into the two biggest revenue sources on the general fund, sales tax and property tax, and we'll discuss sales tax first. This slide shows the rolling twelve month average. It's looking at sales tax from a twelve month average perspective is a better indicator about where sales tax is trending. It takes the volatility of month to month out of the situation. And a couple of things to point out on this, if you go back to the beginning of fiscal year twenty four, fiscal year it was six points.

Was 6.6%. So that's the growth that we were seeing on sales tax at that point. And you can see that there was just a decline all the way through fiscal year twenty four and it started going negative right here around April '24. And that negative trend continued for the remainder of '24 and almost all of fiscal year twenty five. So, this red line is negative.

Everything under this red line, that is just a negative sales tax twelve month average. And in total, as you can see on the slide, we spent seventeen consecutive months with a negative sales tax average. The good news is as of September, started to become positive. We see the just barely we got positive 0.2. And since then though, we've seen some real growth where most recently it's 3.2% as of April. So we have seen sales tax rebound.

Why do you think that happened for that seventeen month average? Any ideas?

Our largest one of our largest sales tax payers had some incredible years post COVID and then started to see a decline. In total, across those two fiscal years, we lost $3,000,000 of sales tax revenue just from that one company. So, you lose that much revenue from one source, that has a big impact. And there's a slide, a couple of slides from here that will compare what our sales tax would look like if you remove that sales tax payer from the equation.

This

is a look at our I'm sorry, maybe. This is a look at our sales tax and compared to our peer cities. As you can see, year to date, this is through April, we're at 3.9%. If you compare that to our regional cities, the average regionally is 10.2%. There's some two anomalies in here.

Have Seguin and New Braunfels. We've looked a little bit into that. Seguin has the new shopping center on I-ten that's generating a lot of new sales tax revenue. And New Braunfels is experiencing a retail boom and there's a lot of construction underway currently that's generating sales tax. If you remove the Seguin and New Braunfels and also I'm kind of jumping ahead a little bit, but also down here with Garland, the average across all the peer cities is 5%.

So, which is a little closer to what we are and is actually closer to what the statewide average is. The statewide average is 5% right now and the city is sitting at 4%. So just some considerations about sales tax. They have rebounded. In fiscal year twenty twenty six, as you saw on the slide, we are seeing an increase in our sales tax collections.

The collections through April are up 3.9 compared to last year. And compared to what we budgeted, they're up 3.4%. So that's really great news. The city's something to that we want to bring to your attention is the city's financial policy halves budgeted sales tax growth at the same percentage realized in the most recent year that there was actually a sales tax increase. And on that slide, I showed where we finished fiscal year twenty five at 0.2% growth.

So, if we followed our sales our financial policy, the amount that we could increase would only be 0.2%. What we're still recommending is a sales tax growth of 1.8%. And that's because we know the contributing factors of what led to that. We touched on it just a little bit ago and I mentioned that this slide would show the impact of removing that sales taxpayer. So, if you remove that sales taxpayer from the past two years, instead of a 0.2% growth, we would have seen a 3% growth.

So 1.8% is a conservative number, especially factoring in that we know that the new HEB and Buc ee's will be coming online soon. Okay. Now shifting to actually our largest revenue source in the general fund, property tax. Before we get into property tax, just a couple of definitions that are important to keep in mind. The market value is determined by the appraisal district in each county.

The assessed value is a property's market value less any applicable caps. So, a residential, you have the homestead cap. The value of your home can't grow by more than 10% a year. And for certain commercial properties, it's capped at 20%. The value of those commercial properties can't grow by any more than 20% a year.

So that's how you arrive at assessed value. When you to arrive at taxable value, which is what's actually used to calculate property tax, you take the assessed value and you subtract any exemptions that you may qualify for. And some examples are the disabled veterans exemption, which is actually our largest exemption, the homestead personal property exemption for commercial property, and then over 65. Another consideration with the preliminary role is the allowance for protest. This plays a big factor in, and this is why it's important to keep in mind that until we get that certified role, there can be some pretty significant changes in value.

So, what this shows is for the past four fiscal years, what the actual change was from preliminary to certified. And as you can see across those years, the three and five year average is 9% and that's what we're using in our estimate. So, if you look at fiscal year twenty seven, the preliminary value is $11,700,000,000 and we're only including $10,700,000,000 of that value to allow for all of the property protest. This is a look at our taxable value across that same time period. You can see in 2023, if you follow the blue columns, it went from 8,100,000,000 to in 2027 we're at 10,700,000,000.

The yellow line shows the percent change. So, that post COVID time when property values were just shooting up, you can see beginning in '23, they increased from the prior year 22%, then 19%. And then in fiscal year twenty five, the market started to correct itself. And you can see they grew by 5%, 1%, and we're looking at somewhere around 5% again. I skipped past this.

I wanted to point out what's in that box over there. These taxable values do include the two housing finance corporation owned properties. In fiscal year twenty six, that's $82,000,000 and in fiscal year twenty seven, the value is at $99,000,000 So, those are the properties that there hasn't been a decision made by the court yet, so we can't operate as if those properties are taxable. Another important consideration is the new value that gets added to the tax roll. So, in addition to the value of current property increasing or decreasing, new value being added to the tax roll is really important.

And it ties back to what Helen Ramirez was talking about with economic development. So, you can see over the past few years, our three and five year average is around $400,000,000 In 2027, the preliminary role is showing that we've added $367,000,000 of new value to the role. To the right of that, in the upper right hand corner, it breaks that out between residential and commercial or industrial. So for residential property, which also includes apartments, the total improvements were $5.96 for just over $200,000,000 So, the average residential improvement is $337,000 For commercial or industrial, there were 26 improvements for 131,000,000. So, the average improvement added $5,000,000 to the roll.

So, a way of looking at that is it takes 15 houses to equal the value of one commercial property being added to the role. Another way to look at that is it takes three of those average commercial or industrial properties to add one employee to the general fund. That it takes $15,000,000 will generate about $98,000 in property tax revenue. And that is the average cost of an employee when you look at all the salary and the associated benefits in the general fund. So, what does all of this mean for San Marcos residents?

Before you can get to city property tax for operations, property tax generated by the tax increment financing zones and any property tax that has to be used for debt service payments comes off the top. So, if you look at this chart on the far left hand side, you have $68,300,000 is what the total revenue that our values will generate for us in fiscal year twenty seven. You first remove all the tax increment financing zones. And just as Ms. Ramirez, you know, pointed out, this is a set amount by percent.

So, an example, the convention center receives 72% and then the general fund receives the other 28%. Kissing Tree is 40%. The general fund gets the other 60. And the downtown tours gets 70. And the general fund gets the other 30. So, you take the 8.1 and that's what has to go to that tax increment zone. Then you subtract out all of the debt service payments. And, you know, these debt service payments are funding the capital improvement programs. So, things like fire stations, streets, the purgatory improvements, that's what these debt service payments are funding. And what's remaining is what we have left to operate on.

And it's what we use to fund parks and recreation, library, police and fire. So, we're going to talk a little bit about property tax rates. And it's important to keep in mind what the different rates are. The first being the no new revenue rate. The no new revenue rate is the rate that will generate the same amount of property tax revenue next fiscal year in fiscal year twenty seven as in the current fiscal year in fiscal year twenty six on properties that were taxed in both of those years.

So, it takes out the new value and only looks at properties that were taxed in both of those years. You have the current rate, which is the rate that is being used in the current year in fiscal year twenty six. And then the voter approval rate, which has been made fairly complicated by the legislator. It legislation is essentially the no new revenue rate increased by three and a half percent. If we exceed the voter approval rate, it triggers an automatic election.

That's what's important to keep in mind with the voter approval rate. And another thing that's important to keep in mind, there's been the state has proposed to reducing this rate to as low as 0%. So, that would mean that any kind of increase over the no new revenue rate would require an election for that rate to be approved. So, this is an early look at what those tax rates could look like in fiscal year twenty seven. I want to start off and just say that I think we went through this last year as well.

These rates will change. We don't have all of the information to be able to calculate what these rates are. So, this is at this point, it's more conceptual in nature. And just know that these rates will change as we get more information. So, what we do know is the current rate.

The current rate is 65.15¢ and that will generate about $46,000,000 for operations. The new revenue rate is being estimated just above our current rate right now at 65.6¢. That, if we were to go with the no new revenue rate, that would generate about $500,000 of additional revenue. The voter approval rate is 70¢ and that would generate about another $5,000,000 of revenue from our current rate. So, as we keep drilling down into how this is going to impact San Marcos residents, now we're coming back to the assessed value.

And this shows the average homestead assessed value over the past five years. And you can see the increase again from '23, '24 to '25. There still was an increase from '25 to '26. An important thing to keep in mind with this is even though the current values are decreasing, the values of the new homes that are being added to the tax roll are often many of those are valued higher than what the average current home value is. So, that is boosting what the average assessed value is.

You can see in '26, it was a 1% increase. And right now in '27, it's we're estimating it's going to be a negative 1% increase. And this will be different for every homeowner. I'm sure you could go through and people in this room and some people when they received their assessed values saw their property values go up and other people saw their values go down. What this means so on average, this is the average change.

So, this compares an existing home's annual city tax bill. So, in the blue house is fiscal year twenty twenty twenty six and the average taxable value was just under $331,000 Using our current city tax rate, the annual tax was $2,059 To the right of that is the greenhouse and that's in fiscal year '27. The average taxable value will decrease, so it'll go down to $323,600 And using the same currency tax rate, these annual tax bill would be $20.11 dollars So we're that's where we're generating less revenue using the same tax rate on those properties that are taxed in both years. At the no new revenue rate, if you looked at the property tax roll as a whole, the no new revenue rate would generate the same amount of revenue. In this particular example, it does increase it.

So, you see that it increases it from $20.11 to $20.25 dollars So, it gets you closer to being able to generate the same amount of revenue on those properties that are taxed in both both years. And as already touched on, at the no new revenue rate, we would generate the same amount of revenue. Okay. With all of that information, we will shift into what the general fund forecast is looking like right now. And just as a reminder, first forecast that we're going to look at is the same forecast that City Council saw at the budget policy workshop.

And these are the underlying assumptions that are driving the numbers behind that forecast. The first is property tax. We've kind of touched on this a little bit already and that new growth offsets the new growth which is the new value being added to the role is going to offset the declining values of the existing property. So essentially the revenues will remain flat. The new personal property tax law that affecting the commercial properties was taken into account.

This was House Bill nine. And in total, that decreased city revenues by $786,000 in fiscal year twenty seven. It includes revenue and offsetting expense from three housing finance corporations. I don't want to confuse you that on the prior slide you saw the two and now on this one you'll see three and we'll talk about two in a little bit. And that's where the Pecos Housing Finance Corporation settled with the city and we now know that it will be on the tax roll.

So, what's remaining is the Pleasanton Housing Finance Corporation and they own two apartment complex. And we talked about the average sales tax growth of 1.8% including Buc ee's and HEB. And then all the other revenues, the fees will be adjusted by 3% annually in accordance with city council direction. On the expense side, the expenses increase each year. For non civil service, the total personnel costs increased 3% and for civil service 5%.

We're also absorbing just over a million dollars of expenses to positions and some operating expenses from the expiring federal funding, the ARPA dollars. We've removed the city's match for the staffing for adequate fire and emergency response grant because we know we did not receive that grant. It does not take into account the retirement incentive program and it does not take into account the emergency medical services or any personnel adjustments for that recent police staffing study. So, with all of that, where we were at budget policy is what we want to see is one of those green check marks. And for '27 forward, we're seeing the red X with the amount of money that we're short.

In '27, it was $4,000,000 and you can see how that grows until in 2030, it's $15,000,000 short. Just one other thing to point out on this slide, you'll see the dashed lines. The dashed black line is the revenues and the dashed red line are the expenses. And so, you would like to see that reverse. So, you would like to see that black. That's the trend line for each one of those. You'd like to see the black above the red. So, the next couple of slides will address what has been done to address that $4,000,000 shortfall. Starting with the cuts that have been made to date. Ms.

Reyes spoke to city council about the retirement incentive program back at budget policy. And in total, that has saved the city $2,000,000 a year the general fund. And that is $2,000,000 that we're going to save every year forward because those are positions that are no longer going to be filled. We've also had the managed hiring program that year to date has contributed over $1,000,000 in salary savings. And the departments holding their budgets flat at assuming 3% because that's what our forecast assumes is 3% inflation each year is $540,000 So, we had departments hold their budgets flat again in '27 and that saved 540,000 Some items that we're still reviewing.

As turnover occurs, we're looking at staffing levels, making sure that if we're replacing that position, it is needed and it's in the best and it's being replaced to benefit the city as a whole. The fleet inventory, we are in the middle of a review on that. There will be savings with fleet inventory, not as significant as what we originally expected. And what this is, is it's looking at those underutilized vehicles so that we have an opportunity to reduce our overall fleet. We're looking at the vehicle take home policy and we're also reviewing the library and park fees for that will be in effect for fiscal year twenty seven.

Another update that will impact the fiscal year 'twenty seven budget is emergency medical services. This shows what the current estimated budget for EMS is. On the left hand side, it's referred to as resources because part of it is just the city's contribution. So, it's really an expense to the city. But what the revenue that we'll receive will be is about $3,200,000 of patient revenue.

The city will need to contribute $5,700,000 and that's how we'll arrive at that total resource of $8,900,000 On the right hand side, that's just a breakout of the EMS budget. Dollars 6,600,000 of it is personnel and $2,300,000 of it is operating expenses. So now we're going to take a look at a revised forecast that takes all of that into consideration. So, on the revenue side, what has changed? To the positive, we had the preliminary tax roll coming in higher than expected.

So, that increased revenues by $3,000,000 It also we were also able to add back over $200,000 for the Pecos Housing Finance Corporation property since we know that we'll be able to receive taxes from that property. And those EMS revenues have been added back of $3,000,000 On the expense side, we had to add another $2,000,000 to cover the EMS expenses. There's IT infrastructure. This is some critical IT infrastructure that has to be replaced. This will be finance infrastructure over four years.

The general funds portion is $700,000 a year. And then the retirement incentive program reduced expenses altogether by $2,000,000 So when you factor all of that in, we do have a check mark, a green check mark for fiscal year 2027, which is great news. So at this point where we're sitting right now in the general fund, we do have a balanced budget. And as you look forward, the amount that we are short has shrunk because of that $2,000,000 that carries forward into future years. I wanted to just include a slide on what it would look like if the no new revenue rate did actually come back at 65.6¢.

And I touched on I was using a round number, about $500,000 of revenue is what it would add. So, we would what it would create in 2017 right now is about $500,000 of capacity where you could allow the departments to increase some of their operational expenses or for some other program or service. Moving forward, it would reduce what the short estimated shortfall is. One of the things that we always decide what to do, our fund balance policy requires a minimum of 25% of fund balance in the general fund. Anything over that 25% amount has to be used for one time expenses.

And in total there will be just over $3,000,000 of over the 25%. And this is just a recommendation on how to use that $3,000,000 That recommendation is set $1,000,000 aside for City Hall, 1,000,000 to move into the health insurance fund. The reason for that, the past couple of years the health insurance fund has had more expenses than revenues coming in and this will help build that fund balance back up. This $1,000,000 is just the general funds contribution. The other funds would also contribute their proportionate share.

In total, there would be about $1,300,000 that would move into the fund. 1,000,000 for capital outlay in fiscal year twenty seven and that's those are those items that the departments request. And there was a detailed list provided within the packet of all those capital outlay requests. And then $200,000 to continue the participatory budgeting. So, is a list of what's not in the budget right now.

And there was also a list of all of these items as well. So, you can see by department, which departments requested personnel operating and capital, and just a summary of what that item was. So, see in total there was 110 requests that total over $11,000,000 If we set aside that $1,000,000 for capital outlay, that would address all but $300,000 of the capital outlay request that you see up there. Then, you know, you have the ongoing expenses of personnel and operating. There were 82 new personnel requests that over $10,000,000 and nine operating requests for $76,000

It's 82 positions?

Yes, ma'am.

Thank you.

So, in fiscal year 'twenty seven, as part of the process where we're going to review fees once every three years, the fees that will be reviewed are the police fees as well as the animal shelter fees. And just an update on departments operational impacts. The departments were asked to provide service level impacts based on not receiving increases to their operational budgets fiscal year 'twenty seven, as well as positions not being filled due to the managed hiring program that the city's had in place for the past couple years. The departments are working on those and will provide that information to city council at the June 25 budget workshop.

Oh, Question real quick.

Yes, ma'am.

On the last slide for the fees under consideration, I know we have a separate workshop item for CIP, but I asked in that one the fees associated with storm water, the last time was three years ago. Are they not included on the calendar to be reviewed this year?

Those get reviewed every year, ma'am, yes. Okay. So they will be reviewed.

Okay. Because I saw a 0% rate increase was anticipated, so I didn't know if we were going to address that.

That is something that we can look at as we move through the budget process. The 0% was just to cover the known operational expenses. If we were going to cover more capital improvement projects with the storm water fund, then we could look you know, increase the rate to be able to cover that. But the 0% was just looking at what the current expenses are, it wouldn't require one.

Okay. For the record, I'd be interested in that. Just saying.

Okay. Yes, ma'am. So just closing out with some considerations for fiscal year 2027. The city will present a structurally balanced budget proposing a tax rate that's equal to or greater than the current rate or the no new revenue rate, depending upon where those numbers come in. The budget includes absorbing over $1,000,000 of expiring federal funding and standing up a new EMS department.

The budget also reflects the impact of House Bill nine that we talked about, which reduced revenues by $786,000 We are currently evaluating the potential impacts that PAC-twelve that Texas State becoming part of the PAC-twelve is going to have on the city from both a revenue perspective and the impact on city services. Services. The city has taken decisive action to reduce costs and operate more efficiently, you know, as an example, the managed hiring program and that retirement incentive program. During fiscal year twenty seven, the meet and confer process will begin for both police and fire. Human resources is in the process of doing a classification and compensation study for the non civil service employees.

The and important to note is the capital improvement program funding remains flat, which limits capacity for new projects. And so, when Sean Condor provides the overview of the community or I'm sorry, of the capital improvement projects, he'll probably be speaking to that because we solving something on the operational side doesn't necessarily help things on the capital improvement side. The city is not the only municipality that's facing these financial challenges. Many other cities across the state, you probably have heard about a lot in the news, are in a similar situation. And it's important to note that in January '27, new legislative session will begin.

And there have been numerous proposals already for property tax reform and city spending changes that could result in reduced revenues and expenditure caps. On utility rate modeling, that is in process and that also includes storm water. We'll continue using the incremental rate increase approach when rate increases are needed for the utilities. And the Citizens Utility Advisory Board will make the recommendations on electric and water wastewater rate adjustments. So, that concludes the overview on the general fund.

Before I shift into the community benefit charge update, were there any questions or would you like me to just continue through?

Questions?

Just a couple. The agreements that we mentioned for, it was let's see, for the TURS, it's downtown, conference center, Kissing Tree. When do the agreements for Kissing Tree and the conference center end? If I should have put that on the message board.

Actually

Conference center not too far. Right. Remember out there.

I've Between 2027?

Council member, if you'd like, we can look at that information. Once I belong, then we can respond as

soon as we get Okay. This 4041. And then the last slide that talked about the incremental rate increase, I don't know if this is a question more for my colleagues or Mr. Locke. Has this approach ever been discussed as it relates to the tax rate? An incremental increase? Like the philosophy that we have for this fee process, has that philosophy ever been discussed when it comes to our tax rate?

Yes. Oh, wait a minute. Tax rate? No, fees and

No, no. Understand.

Understand. Tax rate is tax rate.

Yeah. But I understand. What I'm trying to get at is the philosophy that we have for this is to prevent, at its most reduced level, surprise, right, by people who get these services from like a big jump. What I'm asking need is

used to

hold it for a while. It was held steady, held steady, hit steady, and then finally it got to where we had to increase, so it was a bunch. Right. And so that's why we're doing the small incremental nowadays so we don't have big jump.

Yeah, I'm just wondering if we would ever be interested in approaching the tax rate with that same philosophy for that same rationale. And then lastly we talked about like considerations and I just want to mention because we did talk about this the last time we did our budget. You had mentioned Mr. Locke which I do appreciate it because the legislative committee has talked about it what the new legislative session will bring. And just for the public watching yes we're good they're going to be talking about property tax reform as it relates to homestead exemptions, how much municipalities can raise before it triggers an election.

But there's almost there's things outside of that even within the interim charges such as for like things like TERS, potentially having the legislature authorize changes to those things or implementation of those things as it relates to hot dollars. So I just want to urge my colleagues to consider that as we continue to build this budget because those changes will come September 1 while we're building the budget for 2017. Just something to think about how restrictive the state plans to be and how this might be our one last opportunity to do some things creatively before them.

That was it.

Thank you. Then I'll provide an update on the community benefit charge. The community benefit charge provides greater transparency on the services that utility customers are paying for and receiving. It provides customers an itemized receipt. It is not a new fee.

It clearly shows how much of the utility bill is going towards those four items listed on the screen. The franchise fee, which compensates the city for use of its right away. The utility assistance program that helps customers experiencing financial hardship, roadway lighting for installation and maintenance of street lights for safety and livability, and conservation program, and those are initiatives to promote efficient use of water and energy. The Citizens Utility Advisory Board recommended and city council approved implementing the community benefit charge. And again, as a reminder, is not a new fee.

Purpose of the charge is to provide greater transparency on the services utility customers are paying for and receiving. This is a look at a billing statement before and after the community benefit charge is implemented. This is the summary part that would be on the front of the statement. So, you look on the left hand side and you see that the total bill was $295 On the right hand side, it's still the same $295 You just see the community benefit fee is $15.93 And you can tell that the electric water and wastewater have decreased. So, it's just being more transparent about what customers are paying for.

This is the detailed section of the bills. And so, on the again, on the left hand side, it's the same $295 utility bill. On the right hand side, it is you can see the community benefits section that's outlined in red. And it just breaks out in detail how much of their bill, for instance, is going to utility assistance programs, 24¢ in this case. And you can see as you go down through that list.

So, the outreach associated with this charge is on May 12. There will be there were utility bill inserts on May 20. There will be press releases, website and social media blasts, some cable channel notices, frequently asked question document, there'll be a news hub write up, some newsletter mentions, and customers will start seeing this on their bill in the mid June timeframe.

Okay. So, I've got a question. Will there be an insert in the bill when they first see it that will explain what it is? Because I don't know that people will remember if they don't really understand what it is. If they see it the month before, I don't know that I would go, oh yeah, I saw that last month.

Yes, mayor. Nadine Cisak, assistant director of communications in IGR. The intent is to try to get ahead of it so that way when folks see it, they will have seen information about it. Right now, the plan is to put the insert into the bills the month ahead so that way we make sure we get all of the billing cycles because otherwise there would be a lapse where folks wouldn't get it until after it's already been printed on their bill. We can look at adding an additional message on the bottom so that way we're not paying for a utility insert twice that can direct them then to the website for additional information.

Couldn't you just put like a QR code right next to that section that says, I wonder what this is? And then they just know not everybody has a phone. Can let Again, all the people in the world don't know what QR codes are.

There are some limitations to what we can print on the bill where. So it's either a utility bill insert or it's a message that's kind of at the bottom on a scroll. I don't think there's an option for that.

Yeah, I'm just thinking when they see it, I don't know that folks will go, oh yeah, I got that last month. Why not just put it in the month that they get the bill that they're gonna have the questions about it? That's my question.

Yes, and that's a good point, Mayor. And we will look into that to make sure that we are making the you know, the first time that they see it, they'll also have an explanation there as well. We can also look into the QR code. It is the the challenge with that becomes the real estate on the invoice itself. So, we can look and see if there is enough room. We have to work with the service provider that actually generates those bills so we can get with them and see if we can get a QR code on there. And that may be a solution for us.

If it's not a good idea, let's not do it.

It's not a bad idea. Just don't rely on that as the only way to

SPEAKER Of course. I wouldn't want that to be the only way, for sure. We need all the ways.

SPEAKER I used to be a little like, oh, gosh, access. Not everybody has a phone. But what I learned real quick is that people, especially seniors, they're like, oh yeah. They're like the ones that are on it first because they go and like they tell their niece and their nephew, mijo, come scan this for me. And I'm like, okay, you're more high-tech and informed than me. So yeah. Just sharing that. It's true. Put them to work.

Well, if there's no other questions on that, the director of destination services, Ibarra, I'm sorry, is with us via Zoom. And she's going to provide an update on destination services.

Rebecca Hello. Good afternoon, council, mayor and council. Rebecca Ibarra, director of destination services. I am here to discuss the name change from convention and visitor bureau to destination services. So, excuse me, from Convention and Visitor Bureau to Visit San Marcos. So, within the Destination Services Department, we have the convention. We have three divisions, the Convention and Visitor Bureau, Tourism Program, and the Arts Program. Next slide. So over the last twenty years, demos have rebranded to include visit into their destination. Visit has that direct call to action.

So it's something that has been happening for twenty years. Just to give you a little history about us, the official marketing arm of the city. So in 02/2002, when we created a dedicated tourism website, because we were a part of the Chamber of Commerce at that time, so then in 2002, we established or we created a website. At that time, we wanted to be Visit San Marcos, but we wanted the URL Visit San Marcos, but it wasn't available. It was available for $25,000 But at that time, we chose not to invest in that, so we decided to go with toursanmarcus.com.

But we were still the convention and visitor bureau as we are today. We were just using a different website. So now that we are in the rebranding process, this is a great opportunity for the department not department, the division of the Convention and Visitor Bureaus to transition to Visit San Marcos. So, that is what we are here to discuss or if you have any feedback on that. Then after today's meeting, I will provide a full memo of all the details and other other changes that we have to make within the city process, including the name of the advisory board, changing that to visit San Marcos Advisory Board and other things within the city website.

Should there be a change, the change would be effective October 1. Feedback questions?

Anybody? I'm going to come up and bring up the one that I put on the message board that unlike what seemed to be inferred, I am not against doing this. My concern is that y'all are a city department and there is no city department page like other people do that like they say sometimes who the staff are, etcetera. But I'm also concerned about losing Convention and Visitors Bureau. My suggestion was just on the department list, put Convention and Visitors Bureau, whatever now known as Visit San Marcos, and the link takes you there.

But if folks are looking for the title that I think you said has been around for fifty years, Convention and Visitors Bureau, they go to our department page, they don't see one, I don't know that necessarily everybody's going to scroll all the way down to do Visit San Marcos. So that was my suggestion is just put a reference in there. But I do want to say that there's not a page like all other departments have for Main Street or for the CVB to see who the people are, mission, etcetera. And then there's a link to go over to the other. So think that's an issue, and I've thought so for a while and still do.

Ms. Reyes, if you all could consider doing that for the public so the public will know if they're looking for a CVB that it's there and then it takes them to the visit San Marcos page but there is not a department page for them.

I think we'll have to look and see how just with the way that the listings are to make sure that it makes the format sense. I think I I hear the the ask, and I'm definitely open. I just need to check with communications and see how we make that that work and not make it look different on the change any spacing on stuff for the website.

I think it can be done.

I think it can be too. So I think we can definitely look into it. I just wanna understand the logistics of it.

But we've got the same thing with Main Street. If you're trying to find how to spell Ms. Folletta's name, maybe? Yes. There's not a place to go to find that because there's not a department page.

And city manager and council, if I could, one item that Rebecca did bring to my attention is on the department list. It's not the main page that you're asking about, but the department list. The department list currently has Visit San Marcos.

It does.

And then there's a description. And so that's how it's been listed for some time. And Rebecca can certainly work with staff identify when that change was made.

I know it's there. My point is still, if someone's looking for a convention and visitors bureau, they're not going to find it. Yes. And they may think we don't have one.

Yes, I just wanted to call attention that it's there and we understand the request.

I'm fully aware of that and have been since it was out there.

Okay. Sure.

Female That was not the question. That was not the issue.

Yes.

Okay.

Anybody, anything else?

Is that I mean, if that's council where wants to go, then I think we're fine, Mayor.

What do y'all think? At least put CBB out there so people can find it and then reference where it goes? If you're looking for it right now, you're not gonna

find I find it in the hearts of the community. I'm fine with it, yeah. Yeah,

think I'm fine with that. You're just saying, like, if somebody looks out, even if you just Google it, it's just not easy to find.

You're not gonna find it on our department list.

Oh, on our department list. Okay.

And and I do think that that's even something with other areas. And and it may be the way that the department's lists are, because even there were concerns when I was looking to say, okay. Where's this particular thing? And it's it's not always intuitive for people to know where to go with certain things. And so, I'll use miss, that is Carrie's area and it's under city manager's office. Well someone may not always know to look there so I was already bringing up that hey we need to look at how we I can assist it, maybe I

can't Go use the webpage, go to department, economic and local business development is there as a department. It's not the chart. It's listed as a department. You click on it and you can see what you need to see.

It's there.

Yes, I'm talking about the divisions that are under that, that may not always be as intuitive for somebody to look at if they don't know the department It's that third they're E for

economic Right. Or in alphabetical order. Okay.

So we'll we'll take a look at that and see how we can accommodate.

I think we've got four to do that. Anything else on this section?

No. I trust I have to figure it out. Anytime I've been like, hey, can you fix this, like, with utility page or whatever, y'all flip it and reverse it to make it so that it's clear for people.

So Yeah.

And I just I wanna give a shout out to what Visit San Marcos is doing. It's really cool stuff. The videos y'all put together, just just getting our name out there. I see people sharing it all the time. Very refreshing, and I can't imagine how how beneficial it is to tourism in this community and just highlighting the beauty of our community.

Yeah. I'd say in that. Really cool.

Yeah. We're sharing

it. It's good I see Mr. Gonzales has his hand up though, mayor. Mr. Gonzales online.

Yeah, so I just had a question to the mayor's point.

We can barely hear you. Can you get closer to your microphone, please?

I can try. So to the mayor's point question about listing CBB, I just on the list of departments. So I just want clarification. So if we were to do that, they would essentially be listed twice, Once under CBB and since visit San Marcos is already on there, it would just direct it to the visit San Marcos website?

Yeah. There's actually there's two issues. One is that we don't have CBB or Convention Visitors Bureau at all. So somebody's looking for that they won't find it. But even this whole thing about the department being visit San Marcos, there's still not a department page that talks about their mission, that talks about you know the staff. There's not an equivalent equivalent department page for Main Street or CBB or Destination Services. Well, I was looking for somebody's last name. One day I needed somebody's last name in the CBB department, Just blitzed. I remembered her first name. I'm out there looking, couldn't find it.

Finally, I googled and I found an old picture of the team and a glass bottom boat out there somewhere on our web page is missing a link. And I went, that's her name. And then I was able to email her and do what I needed to do. So that's the deal. So there's no department page.

And there's no CVB. So that if you don't know about Visit San Marcos because that's the latest thing that we're using you're not going to know where to go. And if it were higher up it might be easier because you're looking for CVB and you might find some under C's but you have to go all the way down to the B's to find it. I don't, I hope that people will just maybe Google it or find it. It's two things, missing the department page and CVB not being there so that they can get to visit San Marcos if they don't know the new vet.

I think Rupert has her hand up too.

Yeah. So I get that, but I I guess my question is, so are you recommending remove visits at market from the the department page

No.

Create a CBB one, and then once you go to that department page, then it links to visit San Marcos, or would both be on the list of departments?

I have never recommended nor would I recommend removing visit San Marcos from the department page.

Alright. I was just wondering.

Ms. Bauer?

Yes, ma'am. So some clarification. So the department name is Destination Services.

Okay.

Which we've had conversations, we were still conducting a little research to change the names, and that's why we don't we didn't discuss it today, but changing the name to Destination San Marcos instead of Destination Services. But going back to Destination Services is the department name. Then we have the division, which is Convention and Visitor Bureau or Visits San Marcos. And then we have tourism and arts. So going back to economic development, that would be the same thing, is Main Street would be a division is a division of that department. So do we want to include divisions in the department list on the city website?

Well, I will tell you that what the department list is, is not a, it's not an org chart and so for example, I will see the animal shelter out here, animal services, even though it's under neighborhood enhancement, neighborhood enhancements out here too. But destination services is not out here either. So I'll let you all work that out. I won't spend all day on this.

I would like to add, we are working on adding Main Street to our department web page because it's an integral part of our department. For my department, would like to see that.

Mayor, can I just ask clarification? So under the department's list, are you okay with keeping visit San Marcos and then in parentheses putting CVB or do you want that listed differently?

No it needs to be if somebody's looking for CVB they're looking in the C's. If you're already at visit San Marcos you're good you know what you need. Okay. And we'll just put CVB so if somebody's looking for that and then that gets them.

So two separate

To Visit San Marcos.

So convention, so CVB and Visit San Marcos two separate links.

But the CVB takes you to Visit San Marcos.

Takes you

to same place. Okay, I understand. You.

Although it'd be nice if there was a department page.

Gotcha. Would you be comfortable because the visit San Marcos page is separate from the Civic Plus website that we maintain. I know. Are you comfortable with that department page with the contact information being on the Visit San Marcos page or does it better suit your need to put it on the city page and then link it back out? I just don't get why some

of the city employees don't have a department page like every other department has. But I'll let y'all work with y'all figure that out.

I just want to understand so that way when I speak with Rebecca we have an understanding of can we build it out on their page on their platform if that allows or do we need to build it out on the San Marcos

I'll let y'all miss Reyes work that out. Okay. I've stated what I think y'all should do is do it like all the other departments. And then all these other pages that you need to go to is fine.

Thank you.

I'm not trying to undo anything. I'm trying to make sure everybody can find what we need.

That takes us to the last slide. It is the next steps. As we started with the next budget workshop will be June 25 and city council will receive a draft budget, a draft look of all the funds, not just the general fund. At the August 18 meeting, that's when the budget will be submitted to City Council and that the maximum proposed tax rate will be set. There's still multiple opportunities for community input.

There's community town halls on May 26, June 3, and June 8. The neighborhood commission presentation will be sometime after the budget is submitted to city council on August 18. And then multiple public hearings held on September first and fifteenth. And then again on September 15 is when city council will consider the budget and the tax rate adoption. And that concludes the budget presentation.

In August, will we receive information such as the information we did last year that says at this tax rate, we can't fund these things and at this rate we can fund these things and at this rate

we can fund them all.

What you did last year as we knew that the ARPA funding was going away etcetera, will y'all be providing similar level of detail as last year? Are y'all wanting that?

Just don't put my favorite things on the

last page.

Yeah, will do that as long as mayor and council would like that. I can tell you right now that from what I understand of where revenues are today, that to fund the new EMS department and make sure that we are able to close the gap, we need to at least be at the no new revenue rate from my understanding, John?

Actually, our current rate will do that.

Okay. Okay. So I want to make sure.

See I don't know if the, where we would be with the police stabbing study. I don't know about the positions that were under ARPA. I don't know what's happening with those. We can absolutely bring this to A the lot of that that y'all talked about before. Mhmm. But I right this minute, I have no idea which tax rate would include those.

All things that counsel asked for that were ARPA, that's all included in the budget. So none of that will be coming back for, additional decisions as far as that unless mayor and council want to take something out. But for information. But we can, talk about because right now, there's nothing on the police staffing study, as you mentioned, mayor, that that has come forward, and and counsel said you were willing to consider once the staffing studies were completed. There's nothing on the marshal staffing study. So those staffing studies have been done. So we can bring those things forward, but there may be other needs as well that that council wants to talk about. And so we would wanna just what that is.

Well what you gave us last year was really good and was very helpful to the decision making so I'm hoping we're gonna get the same thing this year. I actually kind of thought it might be today but

if not Because we don't have the final tax rules, we can't calculate what what the actual formal no new revenue new rate's gonna I understand that. So we we don't we're not prepared for that right now. Right now, our main goal was trying to make sure we could fund EMS and closing the gap. And so anything else would be what we would be having that conversation with mayor and council I'm

still unsure as to what all is funded even at this rate. So we'll need to know. Miss Rodriguez?

May I ask that we expand that request in terms of presentation slides that can be replicated from last year to include you all put together some slides. At least for me, last year being one my first full budget cycles to go through, you all had slides that sort of depicted what makes San Marcos and how we came up with our tax rate unique. So like flood zone, the university, things like that.

The non taxable and

the painting tax rule. Of how we got here, why it's not necessarily accurate to compare us to New Braunfels and other places like that.

Yes

ma'am. I'd appreciate, I don't know if my colleagues, but I'd appreciate. Same slide. That information.

That's very, that was very helpful and very impactful. And I think to the public, it was very helpful.

Right. We'll definitely provide the information that's requested. We'll get what else funded within the different tax rates. And if there's any other considerations that we know, mayor and council, that you've talked about in looking at even your visioning and your budget policy to see if there's anything else within those areas that all have discussed.

So no decisions now. Correct.

I do a question though about the presentation, just one question. So when it comes to the excess fund balance, I had asked on the message board sort of like use stipulations and those things. So the four recommendations that were included in our packet, is the twenty fifth workshop that's forthcoming going to be where we actually make a decision on that?

Yes, there will be some decision points on that and that would be one of them.

Okay. The reason I ask is just a point of clarification. So I know city hall is important to all of us. We need it. I hear that.

My question though is the slide that was following the potential recommended uses included I think 1,300,000 a little over $1,300,000 in capital outlay requests. We're proposing or of the recommendations that are included I think it's $1,000,000 for capital outlay. Just given all of the sacrifices that departments have made over the last couple of years, keeping their budgets flat, increasing that or taking some of that and I know it probably makes people shake, but taking some of that $1,000,000 and putting it towards capital outlay, is that something that we can talk about at that time to meet some Absolutely. Of the needs that Okay. Are I'd interested to see I know you all have like 19 projects that are counted under that.

I don't know if there's anything in addition to that that may have been considered supplemental because it just was too much. But I'd be interested to see everything that you all have that's been asked for and how a council can work to maybe discuss in meeting those needs given the sacrifice.

All right. Yes, ma'am.

Barbara And

we will be all wiser at the end of that discussion. But yeah, that really helps. Y'all are in this day in and day out and we are not. So and then there's been a lot of moving parts and sometimes I don't know if it's if that little steel ball is under this solo cup or there's this solo cup and where the little ball goes. Yeah, so I'm lost on some of those things because it keeps moving.

Right. And Mayor, I'd be remiss not to share my appreciation for everybody seeing the figures and just the challenges, scary. So shrinking that 4,000,000 deficit that we were all terrified to see took a lot of work and sacrifice. So just appreciation for all the financial staff, everybody.

Thanks to all who work with the budget, which I think is everyone, because you're doing your own budget So if not we thank you for the sacrifices and for all the information that you provide. It's very helpful.

And I would also say to the staff, if anybody's looking out, even beyond the directors who are doing without, you know, and are having to and asked to do a lot more. So even at, you know, the the front lines, there's a lot of that that that's occurring. So I'd also like to acknowledge our team holistically all within the city organization and departments because and and the the team knows the philosophy is is that we may be a little leaner in terms of staff, but wanna make sure that we can compensate people fairly, provide good benefits, and give them the tools and resources they need to best serve our public. And so ensuring that our public has what they need through our team members is really important.

Yeah. I just want to echo everybody. Thank you so much. Part of my job job in real life is analyzing budgets, like different governmental budgets. And I always feel so good. And every year, gets like, better and better the way that you like, I usually tell people, like, explain it like a mindless child would understand. Like, it's info snacks. It's infographics. From the beginning of the process all the way to the end, that really nice PDF that you put together and you put online, You make it super accessible. Yeah.

I'm like, I'm so proud to be like I'm from San Marcos because some people get it so wrong. And their excuse is always, it's the budget is so complicated. Like, it's hard to condense it on to, like, verbiage that people, the lay person's gonna understand and I'm like try harder. But y'all do.

Well thank you.

Thank you. Miss Trevino, we will move on to item

Two receive an update on the city's expanding utility payment assistance program and try direction to the city manager or designee.

Mayor and council, the next item this afternoon is an update on the utility payment assistance program. This program has been a collaborative initiative between utility billing, miss Christine Avalos, and also the office of community support and resource navigation manager Grisel Perez Carey in partnership with four local agencies, business and community leaders of Texas, community action, communities and schools, and the Salvation Army. In fiscal year twenty five, the city expanded the utility payment assistance program to include these four partnering agencies. This expansion enabled the distribution of more than $133,000 in direct utility payment assistance over three hunt to over 300 households. The program is on track to provide over 125,000 in this current year.

The program provides essential support for residents facing difficult financial circumstances, including rising costs, illnesses, job loss, and family emergencies. Today's presentation provides mayor and council a recap of the program insights into utility disconnections, highlights program feedback from customers and partnering agencies, and outline staff's recommendations for fiscal year 'twenty seven. These recommendations focus on extending the availability of the limited resources to reach more families and residents in need. Before I wrap up, I'd like to thank our partnering agencies and those who have donated to the utility payment assistance program for their continued support. I also want to thank miss Avalos and miss Betis Keri for their attention to this program.

And I know that they've put a lot of effort in really trying to show the deliverables and the outcomes that have been achieved by using these funds. Without further ado, miss Perez miss Perez Carre and miss Avalos. Thank you. Thank you, miss Perez. Good afternoon,

Mary and council, community support and resource navigation manager in here with me.

Christine Avalos, utility billing manager.

As stated, we're here to provide a brief update on the utility payment assistance program, share insights, and feedback received within the program and request direction as we prepare for this upcoming fiscal year twenty twenty seven. As a brief recap in fiscal year twenty twenty five, the city expanded its utility payment assistance program to include the four partnering agencies to administer the program. The agencies, as listed there, BCL, Community Action, CIS, and and Salvation Army, each received an allocation of city funds, approximately the $45,000 in customer donations that had accrued over the years were distributed among three of the four agencies. Further direction was given to utilize donations more broadly enabling agencies to offer pledges for assistance with external providers to our shared customers. Donations received after April 2025 became available this fiscal year for that assistance.

As we entered into new contracts and began working closely with our partners, we introduced several enhancements to the program and increased the level of support available for our residents. One major addition was the implementation of quarterly meetings with each of the agencies. These meetings have enabled discussions on program efficiencies, customer or client experience, challenges, and wins within the program. They've led to process improvements, provided opportunities to solve problems, and strengthen our relationship. These meetings have also given space to share trends of what they're seeing and the impact that it's having in the community.

Additional program updates included increasing the administrative fee from 8% to 10% on pledges, expanding the number of time customers were able to access this program from two times per year to four times within the fiscal year. We included reconnection and new connection fees, and as previously stated, providing that assistance to the external providers, which are Pernalis, Bluebonnet, and CenterPoint Energy. Additionally, there was an increase in outreach and promotion within the program through community events, information within bulletin boards on buses, and throughout various networks. At this point, I'll turn it over to miss Avalos to walk through the customer service support, disconnections, and financial snapshot of the program.

Hello. Okay. So this is just a recap basically on what is being done on the utility billing side. Whenever we receive calls from customers, we are granting extensions to the customers as long as they are calling one day prior to the date of disconnection. And those extensions can be granted two weeks past the date of disconnection.

Clerks are also providing customers with agency information such as community action, BCL, communities and schools, Salvation Army, and then also BR three t Southside Community Center, Saint Vincent de Paul, which is one of the churches. And then we will also transfer those calls to miss Grizelle Pettis Carey. And then just wanted to go back over our utility disconnection process whenever it comes to weather. For any extreme heat conditions and cold conditions, we are temporarily suspending those during these weather conditions due to high temperatures forecasted to reach a 100 degrees or higher for two consecutive days during the disconnection period. If there's a heat advisory that's issued by the National Weather Service for cold temperatures, if those are expected to remain at 32 degrees Fahrenheit or below for at least twenty four hours during the disconnection period, or, of course, if there's a a cold advisory.

And then just a reminder, our non pay disconnections are not performed on the following days, which are Fridays, on the day before city observed holiday and weekends, of course. Okay. And I just wanted to provide a disconnection summary. The numbers that we have up here, if you can look up here, you have fiscal year '24, '25, and '26. The total number of residents that have been affected in '24 we show over 3,438 and then if you go to fiscal year '25, that's 4,237 and then for fiscal year twenty six, we're at 2,615.

We did begin with the agencies with assisting in May 2025, so that's where you'll see that jump. Also included numbers on here to show the accounts that were disconnected that were receiving utility assistance. And as you can see that there's an increase from '24 to '25 They went from 134 accounts to two fifty five accounts and then of course it's a lower number in '26 because we're not finished yet. And in the next box below, it's another summary that shows accounts receiving assistance. You'll see these numbers also jump up because you'll see from fiscal year twenty four from 01/2007 to March, that is where we were able to increase the number of agencies that we're using because originally we were just only using Community Action and we were able to bring in those other three agencies.

The numbers below that, the utility assistant accounts that received at least one disconnection, those numbers were smaller in '24. It did increase in '25 to a 133, and then, of course '26 to '92. And then the funds that were provided, we have listed for '25 the amounts budgeted and then the amounts, the actuals. In '25, the amount budgeted was $165,001 The actuals used was 148,368. You will see that in '26, we budgeted 127,744 and we are almost done with those fundings.

Between the two fiscal years, we did have to carry some of that donation money into the new fiscal year which was the original $45,000 that was held in utility billing that we use for city San Marcos residents. And I'll turn this back over to Gooditel.

Continue with insights and snapshots of the program, we closely track the households that are receiving assistance. So as miss Avalos said, in FY twenty five, we provided this assistance assistance to three thirty five households in this year to date we have three zero two. The demographic information that you see in that lower table is reported through our agencies tracking based on the program eligibility. So individual households may fall within one or more of those categories. We learned from our partners that some of these may be underreported.

As such, we'll continue working with them to make sure that we're more consistent in that data collection. What was happening is is folks were saying, okay, they qualify under low income, and we weren't necessarily counting for them in the other areas. The most notable increase in this has been within our seniors, many of whom are living on fixed income. Partners shared that some of our seniors have moved have shared that they have moved into apartments offering deposit waivers and no rent for a few months. And as that full rent amount is due, they're finding

for it to be more unaffordable.

CIS has been able to provide families with assistance across nine of their campuses. The highest need has been within Crockett, which accounts for 47 of CIS's pledges this academic year. Next in line is Rodriguez Elementary at 14%. Across all agencies, common financial challenges or hardships have included loss of income, rising cost of living, unexpected health related expenses, and car repairs. Throughout the year, gathering feedback from partner agencies and customers has been essential for us.

One challenge that CIS raised was that students within two of their elementary schools, Decevala and Travis, have not been able to participate in this program as they don't receive, utilities from us. Agencies have also shared that they've received a lot of gratitude and appreciation for this program. To offer one example from from a parent within, CIS, they shared the utility assistance program through CIS has helped my son and I greatly. I'm a single mom trying to make it during these times. The economy isn't affordable.

The program has helped me keep the lights on while I barely could keep food on the table. The program helps families who are experiencing hardship. I'm thankful for this program as well as the CIS staff. Please continue the program as it does help greatly. Thank you.

Okay. The spend out rates within our agencies have raised concerns about funding capacity as the fiscal year progresses. To offer some perspective, at the start of fiscal year twenty twenty six, BCL fully exhausted its initial allocation pledging nearly $21,000 in twenty eight days. An additional 11,000 re was reallocated from CIS to BCL in March, which was then fully spent down in seventeen days. Salvation Army pledged its $45,450 allocation within four months.

Given these spend out rates, the remaining two agencies, Community Action and CIS, do not have enough funding capacity to meet current community needs. CIS could only assist students who are actively enrolled in the program and cannot do so during the summer months. Community actions processing time can range from six to ten weeks. Both agencies are expected to utilize the funds before the end of FY twenty six. So currently, there is a gap in the program's available resources to address community members facing utility disconnections.

Customers have also shared accessing assistance has become increasingly difficult from their perspective. In our recent study, one respondent noted that they sense that there's a lot of exhausted resources for some markets. They've had to go from one agency to the other trying to access resources, and others have shared how incredibly stressful this is for them. In April, we launched a survey to gather feedback from customers and invited residents to also participate in focus groups. We received 40 responses.

Many of our customers reported that they felt the process was easy and did not have recommendations for his changes. Some of the challenges that were included and shared were the length of application or process itself, lack of transportation to go to agency offices, limited access to a printer, or difficulty submitting documentation online. When our four agencies are fully operational and and funded, many of these barriers are reduced through same day responses and processes that are in person, online, and over the phone. Other recommendations that were shared from community members was just ensuring that links are active and some of that information is just accurate, which is being worked on. While the following recommendations do not address the growing need in the community for this resource, they aim to extend funding availability throughout a longer period of the year.

These recommendations have been this have also been discussed with our partnering agencies. We recommend maintaining the limit of four times per year and for assistance to cover up to sixty days in arrears plus fees. However, we propose that each month or each bill count as one instance of assistance. Currently, a customer may receive assistance for their current balance up to sixty days in arrears and penalty charges and reconnection fees. In some cases, there's overlap with the next month's bill.

And in these instances, as we worked with our community partners, we've noticed that it's a generally larger pledge, which then adds to the fast spend down. As written, the program's qualifications are solely based on the eligibility criteria of income level having someone your household that is a senior. A child or children five years younger someone with a disability or a veteran. While our agencies are having the conversations with clients about hardship and emergency That's not currently a formal part of the program. As such we recommend adding hardship or emergency to the eligibility criteria.

Though it does not happen often agencies have expressed that they have received applications are met with customers that have not demonstrated an emergency or a need. This addition could also help prioritize households facing urgent needs. As previously mentioned, CIA two CIS schools are unable to participate in the program. We recommend adding the students within these schools to be able to receive payment assistance from the donations for external providers to address this gap in support. Lastly, we recommend establishing quarterly funding caps by dividing agency allocations into four quarters.

The exception would be CIS as they already operate on on three quarters, and they go ahead and divide out internally as part of the way that they manage the program. At this time, myself and miss Avalos are available for questions and seek counsel direction for recommendations on program changes.

Questions, thoughts, Ms. Garza?

Well, first of all, thank you. I feel like I have been very persistent in trying to get some more somebody there, somebody that is taking on the task of doing all of this deep dive just to gauge the need, to gauge the gaps, the barriers, but also to ensure that the money that we do deploy for these programs is being deployed in like the most equitable and efficient way possible. Thank you so much. I guess for the my first question is can you explain a little bit about the and Travis and, like, why like, that situation?

Yeah. So what they have shared is when the the way that the process works is all of the students have to or their family have to go through the campus program manager. And so when that family has approached the campus manager, they find that they do not they're not a part of our utilities. And so they have PEC, Bluebon, etcetera. And so they haven't been able to participate in our program because we also stipulated that it had to be a shared customer.

But that would only be electric. They would still, if they're in the city, still have our water and wastewater. Correct?

They've been on Crystal Clear.

All of them?

At least the ones that have come forward to CIS.

We still have Crystal Clear San I

think it's a question of whether or not the school district boundaries extend to an area where they overlap with crystal clear.

Oh, that's why I was asking inside San Marcos. Yeah. So I think these are folks that are not in corporate seat limits of San Marcos.

Correct. I would need to confirm with them.

Because like Lime Kiln Road and that kind of stuff, I'm trying to think where it's not in the city limits but arguably they would go to Travis. Right. Right there. So, it might it might be a situation like that, mayor. But is this program for people

outside of the City Of San Marcos, Texas? Can they apply?

I think that's a question for for y'all in terms of policy. I think

that What did we set in the beginning?

San Marcos residents.

I don't know that go ahead.

I I believe was San Marcos residents.

San Marcos residents that had a utility service with us.

City of San Marcos?

That has the service with the City of San Marcos.

I understand that part. People in the corporate inside the corporate city limits of San Marcos?

The way it was written is that they would have to have a utility Was it written like that? Service with us.

In the city of San Marcos, but like this situation No, she's

not saying inside this corporate city limits.

Female I'm hearing in city of San Marcos city limits. Yes. With an account. Female account.

That's what I was trying to verify, inside the Yes. Corporate city

Yes. But I think situation, you're talking about a situation again where we have people who are in San Marcos have San Marcos addresses, may be in the school district of San Marcos, but not necessarily in the city limits.

There's going be a lot of people in the school district that are not in the corporate city limits.

Correct. And that's what this is trying to address.

Okay, so it's not that it's blue bonnet or PEC, it's that they're not in the corporate city limits, which was the original intent.

Correct, so like previously, my former house where I lived before, my kids were in high school, I had a San Marcos address but I had blue bonnet and crystal clear water.

Right. But were you in the corporate city limits of San Marcos?

No, I was in Guadalupe County, right outside. Right.

Well, yeah, county doesn't It's the corporate city limits.

All of them.

But I do know that there's Bluebonnet and PEC, or at least Bluebonnet, inside the corporate city limits also. So that's where I

want it.

I'm getting confused. Yeah.

Yeah. So you said at least it's not those who have approached the CIS. Like, that mean, right. Because there's like no way that everybody and DZ and Travis are followed outside the parameters that would qualify them for the assistance.

Correct. From our conversations with them, it's just those that have sought out the assistance. Interesting.

Mr. Scott? You said that they can qualify four times a year?

Yes, sir.

And that if they're sixty days behind plus that month, making a total of three months?

Yes, sir.

So three times four is what? 12. 12. And that means you can get by the whole year basically not paying.

Yes, sir.

Okay. I'm making sure my math is right.

Yeah. Because I thought one month was once. I didn't realize one instance could be three months. That wasn't something I thought was going to happen.

No. Okay. I feel like, yeah, that's not surprising to me. There are so many instances where people are chipping away little by little at their bill, and then it just adds up. I think that's always been a big barrier that sometimes assistance programs are a little bit restricted and that they're like, well, we're just going to pay this one bill or like they don't take into consideration the everything that they're backed up on.

Yeah, that's tough. But I will say that I feel like the partners that you listed, at least from my experience helping neighbors navigate, trying to catch up, that they do a good job doing like case management, just trying to help them so that when they receive assistance, whether it's like a big chunk because they owe a lot, that they are in a better position moving forward to not fall into that situation again, whether that's connecting them with diaper bank or the food bank or go here for like sliding scale medical services. So I just wanted to name that. I think that's one benefit, an added benefit in developing relationships with these partners is that it's information sharing.

Yeah, for those that have other income, like Salvation Army has been helping people with this for years, but for them this was a benefit because now they can use, I'm gonna call it their money for the outside of San Marcos city limits and this helps with the people who are inside. So that gave them a boost of the amount of dollars that we have. Does communities and schools have any other money like Salvation Army would in order to help those that are outside the city limits?

Yes. They have limited funding and they refer to it as unrestricted funds and so they're able to divide that out amongst the schools as

well. Okay. Go ahead.

Yes. So I asked a couple questions on the message board as it related to reconnection and late fees. I've talked with some agencies who do some of the case work to put people in touch with these actual with the assistance. And I'm trying to to better understand so the money that that we use okay. One of the scenarios that was provided me, a guy had he was late.

It was shut off. And so not only were they paying for the amount due on the bill, they were paying for the late fees, they being the people doling out the assistance, us, and then as well as the reconnection fees in his instance. I understand that, you know, these fees go towards certain things, labor, fuel, things associated. That's not lost on me. So please don't take the question I'm about to ask is that I don't have that in the back of my head.

But what I'm trying to understand is of the money that we commit to this program, how to better stretch it. And so I guess what I'm trying to understand is sort of how we can leverage the fact that we have a municipally owned utility system. And we understand that the need for this program is because residents cannot afford the actual utilities that they're currently being provided. And so I guess what I'm trying to understand is how to leverage that to not continue to impose those punitive late and reconnection fees for people who are receiving this assistance. That is more money that we as a city are doling out as a result of it.

And so I'm trying to see is there a happy medium where we can leverage some of that power without it being financially devastating. I don't know if anybody has answers to that question.

Right. We've asked this in the past about the I know Shane's my colleague, Mr. Scott, and I Shane, during the pandemic, when we were talking about even waiving the utility debt, we're trying to get I don't wanna say creative, but, like, find ways to be able to assess, like, what what that would cost us versus, like, where what we already distribute to social services. But I was trying to look for that meeting and or trying to look for my notes. I couldn't find any.

But I do know we have looked at this broadly. But I'm I'm intrigued to to see kind of if we could carry the one, if we could figure something out so that we can help lessen that burden.

Yeah, what would have helped me here is the parameters that we set when we established this program. If that had been in the packet or was it and I missed it. If it was, just tell me what page it's on.

I did not see No,

we did not include the original parameters.

Okay. Yeah, I'd be interested in an answer to that question because when we're talking about a prevention of early fund depletion, I can't imagine that the money going to those specific fees don't contribute to a quicker dilution.

I was kind of thinking with this fee we weren't going to worry about late reconnect and all that. We were just talking about the utility cost. Yeah.

And you know when we look at that snapshot that they included in here, we're not talking about 50,000 people. You know, it's a relatively small population of municipal customers. So I'm just trying to understand the financials. Go ahead, Long.

Thank you. I just wanted to I'm John Locke, Finance Director. I just wanted to remind counsel that at counsel's direction we no longer budget late fees and the utility funds. So it would be a policy decision that council could consider. Council didn't want us, like maybe we waive the late fee for anyone that goes through the utility payment assistance program so that the fees don't use up as part of the assistance that are set aside. If that's direction that council wants to provide, could do that.

Right. And that shouldn't be I mean, and that's exactly what I was going to say. So we're aligned. But what I want to know is that shouldn't be financially devastating to us with the number of households that we're talking about and and all that. So to speak to your point about what, you know, what finding that balance, I can see how we can do without that creating a financial hardship.

Bet maybe four you can pay another bill, though.

Are you comfortable though kind of seeing going around the dice to see if there's even interest in staff looking at something like that?

Well, that's I'm trying to find out. I mean, I didn't think we were to begin with when we established this program. So that's where I'm lost.

I remember we've had this conversation where it was like it's a little bit not nonsensical but like it's not, it kind of doesn't make sense to take into consideration like just wait them.

Right.

And then we're like,

oh, you said We're moving one ourselves. Yes. You said we're moving money from one bucket to another.

Right. Actually, I think it's the same bucket.

Yeah. It's our bucket though. They're both our buckets. Exactly.

Right. Exactly. I just think, you know, without doing so, there's a phrase that, my god, I can relate. It costs money to be poor.

It does.

Right. And so I'm just trying to figure out how we can if there's counsel consensus, like I said, we don't have to make this decision now, but I would wanna understand implications if any. Let

me get some clarification then I am gonna go around the table So on this we are not waiving those fees, nobody's waiving those, the late reconnect, etcetera fees? No ma'am. So that is coming out of these dollars?

Yes ma'am.

Okay, so now I'm going to ask the question, go around the table, do we want to waive late, reconnect, disconnect, whatever other fees there are outside of the utility charge that you get on your original bill, do we want to waive those fees?

For me as long as these organizations that are paying the bill, that's fine. I'm just saying I just want to

The organizations aren't paying the bill, we are.

No, the triggering, that's what I want to be done. They're going to take care it.

You're saying the people who go through That's correct.

Yeah, it's just for this program going through Salvation Army, That's BCL,

the only help you'll get.

Yeah, that's what the question that's the parameters around the question. Mr. Scott? I see a thumbs up yes. I'm seeing Ms. Rodriguez, yes. I'm seeing Mr. Paseck with a thumbs up. Ms. Garza, I think it would be a yes.

Absolutely yes.

And as am I. And Mr. Gonzales, I don't see him on right now but we have six Oh there, Are you there?

Oh, yeah. I'm sorry. I have my camera off because I'm driving. I want yes, but I also wanna keep in mind that we lowered our fees. So, like, don't pat ourselves on the back because it's not like we're gonna save them in dollars by doing this. I mean, we already kinda barreled out the fees anyway. So I don't think it's gonna make that big of a fiscal impact, but I'm a yes.

Okay. Yeah. What we do with the fees, that's a whole another question for maybe even another day.

And then, Mayor, I just have one more question on the staff recommendations. When we talk about emphasis placed on hardship and or emergency, remind me for I know that you have your low income category that can qualify you veteran, child, senior I think those are the four. I'm not sure if And it's disability. And disability. When we talk about emphasis placed on hardship and or emergency, the because for low income, don't we use 250% of the federal poverty level, which is a little under $40,000 from what I checked?

You mentioned a story about a single mother, two kids. That was my mom. That was my scenario. My mom made too much money to qualify for assistance, but still very much needed it. And so I do agree, know, in a sense, like the philosophy on people with the highest need being prioritized in some way, shape, or form. Absolutely. I guess what I'm trying to understand is, are we proposing this is program wide in terms of emphasis? Or are we proposing a certain percentage of funds being set aside for these specific populations of people? I'm just not trying to cut people out because hardship can look it's very subjective. Right.

And a lot of that is giving the autonomy to the agencies to have those conversations because they're already having those conversations, They're looking at the documentation. As I mentioned, there's just been a handful of scenarios where folks have come in where, yes, they meet the qualification, but there is not a hardship or an emergency. One person in particular said, everyone else is getting it, and so I'm interested in it. And so as we look at stretching this fund, we hope that that will assist with that. And again, the agencies are having those conversations.

So it's more of like a discretionary emphasis rather than us putting a firm percentage or a firm stipulation that the money can only be used for x purpose.

Yes. And I think initially there was some hesitation from agencies of denying any applicants because of the conversations of the program. We really wanted for this assistance to get out in the community for those that needed it. And so I think that there was some hesitation to decline people initially. And so once we were having some of these conversations about their processes, I think that there was some comfort. And so then allowing for this to be a part of the formal program will help them as

well. Cool.

Yeah. I have no idea what organization is just giving out money without a hardship. Like, that's wild. Yeah. But, yeah, it makes sense.

And like you said, I do think that there's all of the partners that we have funded and work alongside. I've seen a lot of leniency pivoting and getting creative whenever they have different lines of money for different programs. Some programs have different restrictions and they kind of just play. They're just like moving things around just to make sure what combination of money can go where. So I feel like they're pretty good at gauging hardship and also how to get people to qualify for a certain external funding based on like their story.

Okay, this is really surprising me because again, I don't have, I'm looking for the qualifications and I'm not finding them quickly. I'm finding a lot of links of dashboard. So tell me again what is the requirement if it's not emergency or hardship?

I'm trying to pull this up. So low income up to $2.50, it's in that bottom table of federal poverty line, seniors defined as 60 or up, disabled, veteran, or young children defined as five or younger.

And so if somebody just comes in and says, I'm over 60, they qualify? In theory, that's where a lot

of those conversations then happen with the agency of what is the hardship, what's the emergency in uncovering.

It's interesting. I wonder if it has something to do with people's inability to articulate like I'm a senior citizen on a fixed income. I didn't crash my car. I don't have a sick child. But with the increases of literally everything, being able to have some assistance with my utilities is going to help me pay for my prescriptions. Maybe there's not an increase in prescriptions, but it's like the cost of living in general increases.

But wouldn't they fall under the low income category? I'm sorry? Wouldn't they fall? Shouldn't they fall under the low income category?

Right, right, right. Is it that, yeah, it's low income, but do they, are you saying you want them to also have a hardship?

There needs as part of their application process in the conversations with the agency to be able to discuss some of those things. And that's a prime example of what community action in particular is seeing where they're on a fixed income, right? And it's, you know, my rent is too high, my utilities are too high, I'm having to push back some of my medical care and whatnot. And so those conversations are happening and hit both

of those buckets. Okay, good. Okay. Yeah, I was just trying to figure out in what scenario somebody's just showing up and being like, I want assistance and not having hardship. Or whatever.

You keep track of households. Households that are the same household perhaps using the program over and over or do we keep track of that?

Ms. Yes, sir. And I'll let Ms. Avalo speak a little bit about what her team is able to do on that front.

Ms. Yeah, because you track that by address, right?

Ms. Yes, by address and then their name tied to there so we can track it. And then in the system once a customer has already reached the four times per fiscal year, we mark it as an alert and then the agencies are also tracking this as well. So that way if the customer comes back, they won't be able to help them with the city funds, but then they'll have to look with their other funding that's available to see if they can assist the customer that

way. Okay.

So now if they contact us, the city, we're still doing payment plans and whatever it is that looks like will work for someone? We're still doing that, correct?

If they qualify for a payment extension, then Right, we'll do right.

So when that doesn't work, that's when they're referred to one of these other agencies, correct?

Correct. Well, the clerk is still providing the information. They'll do the arrangement and they will also give them the agency information for them to reach out as well.

Ms. Okay. Something to think about. Well, we've got several things and I'm not finding, I'm on the San Marcos utility payment assistance page but I'm not seeing what the, basically what the rules are, what the criteria is. It must be somewhere else. Oh, here it is. And it says, this is what you were talking about earlier. It says the applicant must have an active SMTX utilities account of some type. Yes, ma'am. Because it might not be electric but it could be water.

Yes ma'am.

And they're paying, they pay their electric bill to whomever it is but yet they're getting water, wastewater from us so they could get assistance with the water and wastewater.

Yes

ma'am. Got it. Yeah but to say you must meet at least one of the following, have a child under the age of five, that money's not gonna go very far. Okay so it looks like there's maybe several things that we need to talk about. I'm making my list here.

The council tell me Tell me what what you all are thinking. Yeah. What changes we might want to make? And you see them right there on, oh it was right there. And maybe it'll come back.

Yeah. Mr. Geary, can we go through and talk about what we might want to change in the criteria during this discussion? Because they're asking about eligibility how I we can

think on this posting it's pretty broad. Think you can cover the whole gamut really. And it's just direction.

Yeah I still gotta come back officially and.

So that's okay.

Okay. So counsel right now I'm going to ask of these items which ones do you want to continue and if you could just give me the words of the ones that you want to continue, you can say all of them if you wish. But right now, you only have to meet one of the following. And for me if it's low income and can't pay your bill whether you have children or not I don't see where that fits in other than clearly you have other things that you need to be spending money on. So I don't know.

But I'm going to go through and I will start with you, Mr. Pesalk. I always start on the end. I won't start on Are the end this ready to make some preferences?

I don't have any preferences that I would change.

Having a child under five is okay. No other criteria?

You know, I'm not just going to say that I know enough about this to make that decision. Mean, just feel comfortable leaning into people who have a little more experience than myself.

Can we all agree that the low income is certainly one of the qualification that we would need? Would we say yes to

all Well, to Mary, are you trying to change these just outright as in you'd like to redo this whole chart to make it better?

That's what I'm looking at because just because somebody's got a child under five doesn't mean that in my mind that they qualify for this. If they're low income and have children under five, yes. But if you just have kids under five or you're 60 and that's the only criteria and you're not low income, I don't see how those folks qualify. And given what you said is that's where some of this money is going, that's concerning me.

My initial thought though with the children, young children, is just the cost of childcare. Right. Is similar to tuition at a major university. Right? And so I can't help but think of the families that have one or two children in day care while also Yes. Managing their entire household. Thank you.

And if I may add to that, Mayor Uh-huh. This is not a hype hyperbolic scenario. I'm gonna actually talk about this. This is my friend. She works for DPS or no. I'm sorry. CPS Uh-huh. Gets a good state check with good state benefits. It's still insufficient. She has two kids under the age of five.

So she doesn't qualify for the first call.

She doesn't qualify. And that was a scenario I gave with my mother. She made too much money to qualify for assistance, but she still needed it because to have kids

But we could change that percent.

And was actually when you came around, that was going be my proposal given just the antiquated nature of what we consider the federal poverty line. But when it comes to, I mean, a relatively small amount of the money is going to this population in terms of young children, For me personally, it's not just child care, but it's also we were talking about in the last discussion inflation.

But you're talking about people who do qualify. I'm talking about the people that we would not generally think qualify. They're just in because it says you can if you're over 60 or you've got children under

I'm actually not though because the scenario I'm bringing up is a very real scenario of my friend.

She has kids I'm not talking about that scenario. Qualify low income. I'm talking about somebody who's got plenty of money, does not need help at all. They can come in and qualify based on

this chart. Let me ask. I know you made plenty of calls to people who received this assistance, both I know you made calls to organizations who dole out the money. Was editing this particular snapshot that we're referring to it as of a priority of concern? Like are people really fitting this category in mass that's deserving of adjusting these qualifications?

I guess going back like who came up with that scale? Yeah. What was the rationale?

And then I need to go to Mr. Gonzales. He's had his hand up for a while. Next. But we'll get this question.

Well

Is this two fifty used anywhere else? Or is this what Community Action was using? This number had to come from somewhere.

To my understanding, the two fifty came from community action with their CF program has to use 150. And so in order to make it more accessible for our community members, the decision was made to go up to two fifty I'm not sure when that decision was made.

Y'all inherited these I inherit,

yes. So I'm not exactly sure at what point these parameters were determined.

Okay it is five seventeen. We have another presentation and we had executive session stuff but I believe we'll be doing that later. So don't, I don't think we want to push that CIP program. Is this something that we want to think about? I would like to see the rules, I'd like to see the applications. I think we need more information to sit and contemplate before we can make final here. I'm hearing two yeses down here.

For what part Mayor though? Mean this particular, the whole thing. Where were all the questions along the way? Guess I'm just, yeah let me go to mister Gonzales.

So essentially, I just you know, in listening to

Louder. We can't hear you.

Honestly, I think it's the sound system that that the city has, but I'll I'll yell. So just to your point, mayor, about a person that has a child under five that has plenty of money, I don't see that person taking half a day to walk into The Salvation Army and fill out paperwork just to not have to pay their electric bill. So, honestly, I think the qualification should be that you need help paying your electric bill. If you're two months behind, you're pending, you know, being cut off, I don't really care how many kids you have, how old you are, or how much money you make. Like, if you are gonna take the time to navigate these resources because you need assistance paying your bill, then you should qualify.

Right.

Because I don't see anyone paying you money taking half a day to a day of their time to avoid paying their electric bill. Yeah. They have better things to do with lot of

what he said. But I and do I think that people will come in?

I believe I just heard miss Perez Carre say that, yes, some have. To what agencies, though? I feel like isn't there generally even an intake, like your beginning conversation? You set a foot into any of these agencies. They're already fielding, like, are you somebody who is gonna require or who requires some assistance in some capacity?

So I'm just like, I'm trying to I think it's one of those situations where when we also talked about how if we that some people were just not paying their bills on purpose for giggles. I don't doubt some people maybe forgot, but I don't think some people were just going to not pay their bills for giggles so they could get fees waived in masses. I tend to align with what Lorenzo was saying. And I just don't think that's a realistic concern. Right.

It feels more like we're making policy off of an anomalous decision or an anomalous situation. I just if we wanted to if the question is do we want to address this little part, I mean, the one thing I would be interested in is addressing the what I feel is antiquated, the federal poverty line, the 250%. But anything outside of that just feels entirely too in people's business. This is already like to go apply for assistance is a very it can be very demeaning. That's why a lot

of people who go do it,

the pride actually stops them from going and looking in the first place.

Right.

So I think making it further punitive and like into the weeds almost enhances that demeaning nature that comes with seeking assistance.

What do you mean further punitive? If you're, that's what you're thinking I'm doing. I'm Restrictive. Trying to make it

And I agree with perhaps maybe something needs. But I can tell you, Mayor, I've talked with these agencies that dole out this money. I have not heard hyper concerns about this particular issue. The other things that were mentioned in staff recommendations, which I don't necessarily I know there was a question on like, do we want to postpone this into oblivion? I hope not. But

No, those other things postpone for extra information. I never said oblivion. Let's not go there.

I'm being facetious. What I'm trying to say is there were no other concerns mentioned for any of the other recommendations that were listed here. Those things need to be implemented as soon as possible to address concerns now. If we want to sit here and be hyper detailed in terms of how this snapshot looks, that can be a separate issue. But I don't understand. There was no we had gone around the room on some of these recommendations, and there was consensus. So what I'm trying to see is why can't we move forward? If y'all, as a body Yeah, we've done one. Concerns, it's fine. But why can't we move forward on those things?

We can on the others.

I just think we've

got some loopholes. And here's the other thing I don't understand about the agencies is the agency in my mind was is this someone that you for your criteria would normally give some dollars to but you don't have them, now we're going to provide some dollars for you but not to change the criteria by which they would normally provide funding if they had it.

With some of the agencies it did so for Salvation Army, for example, they don't have an income requirement. It is solely an emergency. The other piece is they only offer assistance once in a twelve month period as well. So this also was different for them to allow for someone to receive assistance up to four times a year. So in in some ways, did. And I think that also there was that hesitation, as I mentioned before, of denying people. And so through some of those quarterly meetings, they were reassured, no, continue asking the questions, right, continue with the case management and providing the resource navigation and engaging in conversation with our customers and residents.

Okay. So let's go through the list. Assistance limits each bill equals one instance of assistance.

Where's that? Versus what which what is the like that's what you're recommending but what is it that replacing?

It's What cleaning up some

does that mean?

It's cleaning up some language because one instance currently can include the current balance sixty days back and if there's overlap with that new bill, also include that amount.

But you're saying now you want it to be what? Each bill?

Three months to one month.

So essentially yeah. That's what I was gonna ask.

So basically you were considering three months, one instance.

Yes. Well yeah because like you really can't, you're kinda stuck in limbo if you

don't Well here's handle the question, question do we want to go to one month basically or keep allowing the multiple months under one instance is that what the question is?

No we still would like to be able to go back sixty days each of those bills

Oh like period counts as three. Okay. So I need y'all's input on that one and let me go to mister Gonzales. He's got his hand up.

Yeah. So my only concern with, for example, this scenario where it would count as three, we're allowing someone four instances. So they go in one occurrence. They're knocking off three of their four instances. Eight months down the road, they're sixty days behind again. At that point, are we only gonna help them with

One month.

One month, and yet they're still behind. Therefore, they're still pending termination of their services. I feel like at that point, then we're just really not helping them. So either limit it to three months or, like, three instant or three whatever or bring my other suggestion would be don't do four instances. Do, say, two instances a year, but still allow to just go back to three months.

So, essentially, they could get a maximum of six months of their bill paid. So it closes the loophole that mister Scott brought up that, theoretically, you could just never pay your bills and just go in every quarter and wipe out a quarter. But I'm just not comfortable. One occurrence knocking out 75% of your assistance, and then in the future, that 25% you have left doesn't really help you much because if you're at the point where you're pending termination paying a third of what you essentially owe isn't gonna stop anything.

Right. And even if there's other programs that can fill in that gap, then they would still have to deal with reconnection fees and all of that because then they're not going through this program. So that kind of further adds. But to the mayor's point, think that I would like some more information on that. Like what is even like the trends when it comes to how many people face that type of situation where it's like their one bill goes back x amount of days, right? Yeah. So I do think we How

much change would this be? But I'm going to guess it would be a lot. Otherwise, y'all wouldn't be recommending it.

Right. We do. We do have quite a bit. And we understand that this is not fixing the problem. At this point, we're trying to stretch the dollars just to help. The agencies are also working with the customers, and they have those plans in place as far as asking them, what are you doing next? What you going to do in two months? You know, do you have a job? What else can we help you with? And then also with Grisel, you know, as far as utilities, we refer them to her for other resources that they need as far as food, rent, all of that stuff. So we know that this doesn't fix it. But I mean, here we are in May and we're almost done with the funding.

Right, right. I wonder, I guess, to the mayor's point, I think I would appreciate a little bit more information on this. I think everything we've kind of already agreed on, I think we're good, like the waiving of the fees and all of that. That's all we've But agreed on so I wonder if it could be one of those things where whatever changes we do employ, whether it's Mr. What Gonzalez suggested, like maybe doing two instances.

But also within the context of quarterly funding caps, like if we could whatever changes we make, it'd be interesting to see if it's we could do it like a pilot style to where we can revisit it based on trends and data in the future. Obviously, we don't have a crystal ball. We don't know if we're going to have another crazy environmental, biological catastrophe. But hoping that we don't, then I think that maybe that a year or whatever pilot type of time frame can help us see where we're going. A lot of this is difficult to imagine because we just don't have enough info, I think.

Right. Mara, if I may, I think too the point you just made is super valid because discussion we had on the forgiveness of the fees and then the discussion that it sounds like we're going to have here in a little bit on the quarterly funding caps. I wonder if the change that both of those will provide would sort of make assistance limits more of a not moot, but a recommendation that may not necessarily be as prioritized or needed in the same way. Like, wonder if those changes obviously, you're not fixing it all. We're not going to fix poverty. That's just being real. But I'm wondering if those would provide some changes necessary rendering this a little bit To go further. Yeah. I mean, definitely agree with Mr. Gonzales' sentiments.

But, yeah, take a

at it. We could try that if council wanted to and and just implement those two changes at this particular time. The first one, it would be to waive the late reconnect fees and those kinds of things that council had consensus on. And then try to go to maybe the two instances per year, but go back the three months that is currently allotted so that that still gives that. And then we could get a report back to see what that

looks like.

I don't want change the number of instances per year because that means changing the four. We're looking at what defines one instance.

That's correct. And I heard the suggestion of going back three months,

but doing maybe two, so that

that would be actually like six months worth

of Basically, it's three, but you call it two. Exactly.

Yeah. And then that compounded with, dependent on consensus, impacts of implementing quarterly funding caps.

Female Okay. So two counts as two and three counts as two.

Female I think that was his proposal, yeah.

That's what I'm so I'm going to ask, if you all will tell me, do you want to go with the one instance, which is one month's bill counts as one? Or do you want to do the two counts as two's and three can count two? So that's the response that I need for this one. Mr. Paseck.

I'm fine with the second option.

The what?

The two counts as three option.