Board of Supervisors - Regular Meeting

Ready to start here in about 30 seconds. If everyone could please take their seats, that would be greatly appreciated. Thank you. And we'll go.

Okay, it looks like the last person signed in, so we're going to go ahead and begin here. The Santa Cruz County Board of Supervisors calls this meeting to order on July 15th, 2026 at 9 30 a.m. in the border support of Supervisors Meeting Room 120, located at 2150 North Congress Drive, Nogales, Arizona. At this time, I'd like to ask one of our very special guests today, Roderick Garcia. Would you please join? Lead us in the Pledge of Allegiance.

I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation, under God, indivisible, with liberty and justice for all.

Thanks, Roderick, and we look forward to seeing you in a little bit. At this time, we're going to go to item B, adoption of agenda. Mr. Manager?

Mr. Chair, members of the board, we have no changes to the agenda. Thank you.

Thank you, sir. Mr. Chair, move to adopt the agenda and allow chair to deviate as needed. Second.

Thank you, sir. It's been moved and seconded. Any further discussion? Hearing none, all those in favor, please signify by saying aye. Aye. Motion carries unanimously. Item C, call to the public. This is the time for the public to comment. Members of the board may not discuss items that are not specifically identified on the agenda. Therefore, pursuant to ARS 38-431.01 , action taken as a result of public comment will be limited to directing staff to study the matter, responding to any criticism, or scheduling the matter for further consideration and decision at a later date.

And we have quite a few.

folks who have filled out the speaker slip today, so I thank you for that. So we'll get right to it. And when you come up to the mic, please state your name, your address, and please remember that you have three minutes. And prior to that, if you have your phone on, please mute it, turn it off, or put it on vibrate, what have you. Thank you so much. Dr. Lisa Redpath. Take your time.

Good morning. Dr. Lisa Redpath, 422 Camino Combre in Rio Rico. Good morning. Good morning. Gentlemen, I'll be brief. I am here today to ask you to deliver just one word to Mr. Pat Reisner and his associates on my behalf. Karma. Thank you very much.

Thank you. Gary Levine.

Gary Levine, Camino Cumbre, Rio Rico. Gentlemen, I spent the first part of my career working as a certified public accountant for one of the big four CPA firms, doing financial audits of companies of all sizes, ranging up to billions of dollars in revenue. I spent the rest of my career as the Chief Financial Officer for several companies. In that capacity, my responsibilities included implementing internal accounting controls and procedures to prevent the type of theft committed by former Treasurer Elizabeth Gutfar and also working with outside auditors. So I have some expertise with respect to the conduct of financial audits, internal controls and procedures, and the prevention of theft and fraud. On today's agenda, there's an executive session to discuss the potential retention by our county of outside counsel for current or former employees named as defendants in the Auditor General's lawsuit. Let me say in no uncertain terms that would be entirely wrong on several fronts. First, if any of those individuals were not employed by the county at the time of the theft or in the Treasurer's Department, They need only say that was the case and that they have no knowledge whatsoever of or connection to what transpired. It does not require legal counsel to do that, and the county should not be paying to provide them with legal counsel. Second, with respect to employees who were employed in the Treasurer's Department during the time that Elizabeth Gutphar was stealing $40 million, there's been extensive reporting of the close relationships in that department. and some significant gifts that were given by GUTFAR to employees. It completely strains credibility to think that there were not employees in that department who knew what was going on or had a strong sense for what was going on but chose not to report it. And my career experience would also suggest that a theft of that magnitude and number of transactions involved could not possibly have been done in secret. There could be no possible justification for the county paying for legal counsel for those individuals who enabled Gutvar to steal those funds. And if there's any individual in that department who truly somehow had no knowledge or sense But this massive theft was taking place that again he or she needs only to tell the truth about that and the county does not need to and should not be paying for legal counsel for them. Third, there's the matter of those responsible for supervising the Treasurer's Department, including the previous county supervisors in office at the time of the theft. Supervision responsibility indisputably includes actively ensuring that a job is being done correctly, accurately, and lawfully, and especially when it relates to handling money, and also that there are strong internal controls in place that can and will prevent theft or fraud. It would take more than my allotted three minutes to detail based upon my knowledge and experience all of the specific supervisory failures that allow that theft. Those supervisory failures constituted extreme negligence and it would be a travesty if taxpayer dollars were used to provide legal counsel to those previous supervisors or county supervisors who the county supervisors, other than Goodfire herself, without question bear the greatest responsibility for the theft of the $40 million. in taxpayer dollars. Finally, consider the optics and the message that you would be sending to our county residents who I can tell you from personal experience already have a great level of mistrust of the integrity and honesty of our county government. You would be throwing gasoline onto the fire to now use their taxpayer dollars to hire legal counsel for those individuals. Thank you very much. Thank you, sir. And I'd be happy to provide the detail of any of those supervisory deficiencies or lack of internal controls at your convenience.

Thank you. Ana Darien.

Good morning, Chair and Supervisors. My name is Ana Darien, and I serve as the Executive Director of Patagonia Area Resource Alliance, and I am a resident of Patagonia. So this morning, you'll hear from South 32 Hermosa President Pat Reisner, who's here today, with the company's quarterly update. If it's anything like the previous updates we've heard, you will likely hear many of the mitigation measures included in the U.S. Forest Service decision and the opportunities this project promises to bring, particularly with jobs. But I want to make sure that the public also hears what the Forest Service actually decided and what it chose not to resolve in its July 7th record of decision approving the Hermosa mine on Coronado National Forest lands. This decision clears the final major hurdle of one of Arizona's largest underground mining projects to move forward on public lands. Yet it does so while leaving numerous legal questions unanswered, all in the pursuit of making Hermosa the nation's first approved mine under the federal FAST-41 permitting program. Among its most significant decisions, the Forest Service approved a new primary road across Flux Canyon Road, this is on forest land, a large tailing storage facility within federally designated jaguar and Mexican spotted owl habitat, a new 138 kilovolt transmission line, direct discharge of treated mine water into Goldbaum Canyon and Maui Wash, and a project specific amendment to the national, sorry, to the Coronado National Forest Plan. and that amendment in particular is important. The Forest Service acknowledged that the project could not actually comply with the forest plan as it is written, and instead of requiring Southway 2 to redesign the project, it created 31 project-specific exemptions to allow this mine to proceed. Those exemptions weaken protections related to wildlife habitat, habitat connectivity, water resources, ecosystem integrity, scenic values, and recreation. The agency also approved a tailing storage facility before resolving fundamental legal questions, whether this facility could lawfully occupy national forest land. And at the same time, it dismissed our concerns about cumulative impacts to wildlife. These are not minor procedural disagreements. They go to the heart of whether this mine was fully evaluated before it was approved. And finally, in my time here, I would like to address the narrative around this project. So for years, Hermosa was promoted as essential to America's clean energy future, a cornerstone of the green energy revolution. But more recently, and even in South 32's own press release that came out last week, It is now being heralded as a solution to our so-called national security challenges, and that it creates a domestic supply of critical minerals, even getting a quote from Senator Mark Kelly that states this fully. So in my ending here, I would like to ask Pat Reisner to address a couple of questions in his presentation, and the first is, As I remember in this very room, you have presented that we do not actually have the capacity in the United States to do the full production of the minerals extracted from this mine. I would like you to explain in great detail how the supply chain of this project works such that this actually creates a domestic supply of critical minerals. And secondly, there was an announcement in May around the timeline of this project moving out to 2028, and I would like the community to get an update as to what that means for the Community Protection and Benefits Agreement, because it appears as though a lot of the early action items that were initiated are now contingent upon this project operating. I am past my time. Thank you. And so I just encourage the board, as you continue to hear about these projects, just look beyond the headlines and ask the real questions around the legitimacy of this project. Thank you.

Thank you. Chris Gardner.

Thank you, County Board of Supervisors. My name is Chris Gardner. I live on Squirrel Tail Lane just north of Patagonia. Thank you for the study sessions with the ADQ in South 32 in February regarding the antimony and discharge issue. Glad to report that the discharge now meets permit standards. However, it appears that the discharge is mobilizing arsenic and sulfate from the Harshaw Creek watershed into the drinking water supply. A well in Santa Cruz County near the town of Patagonia had arsenic concentrations of about 2 parts per billion last year. Now concentration of arsenic in that well is 10 parts per billion. The primary drinking water for arsenic is 10 parts per billion. A well at the edge of town had an arsenic concentration of less than one part per billion last year. Now it's seven parts per billion. A well in town had an arsenic concentration of about two parts per billion last year. Now it's five parts per billion. The trend shows arsenic concentrations are increasing in and near the Patagonia and are now at or approaching the primary drinking water standard of 10 parts per billion. The hypothesis is that discharge to Harshaw Creek is mobilizing existing contamination, which is impacting the drinking water supply. I'm a volunteer with Friends of Sonota Creek and the Arizona Department of Environmental Quality Community Science Alliance. The results presented to you today were collected in coordination with the ADEQ. Contact Megan Smart at the ADEQ for more information about the ADEQ Community Science Alliance and their amazing work in Santa Cruz County. The concern of mobilization of existing contamination from the highly mineralized Harshaw Creek watershed was presented but ignored by the US Forest Service. Their environmental impact statement ignored organizational comments regarding this issue. I now predict that SAL 32 will use the EIS to ignore and dismiss the data I'm presenting to you today. I practiced hydrogeology for 30 years, 28 years in Arizona, and 23 years as an Arizona registered geologist. I pioneered drilling and sampling techniques at EPA Superfund sites, which were the standard when I retired. I'm more than comfortable in having any information presented to you challenged. However, the first person to challenge regarding the data presented to you today is Amanda Stone, Deputy Director with the ADEQ. Today, I'm challenging the Board of Supervisors to ask South 32 to immediately share their water quality data from South 32 owned wells along Harshaw Creek as we question the presentation I gave to the Board this morning. We ask that In the presentation, we asked that monthly monitoring wells included in the presentation and to monthly monitor other wells in and near the Harshaw Creek watershed whose owners want to participate. This data should be provided privately to each well owner. I'm more than happy to help South 32 access these and other private wells whose owners want to participate. What the community asks is that the CBPA provides well owners with the highest level of water quality, which goes beyond legal requirements. This should include the installation and maintenance of new domestic community. We're at three minutes, so if you could. Last sentence. And municipal water treatment systems. Installation of new domestic, community, and municipal wells. And new distribution lines as requested by property owners in and near the Harsha Creek Watershed. I appreciate the extra time.

Thank you, sir. Ernie Edwards?

Good morning. Ernie Edwards, live out at Lake Patagonia. Here we go again. Thank you, Chris, for your diligent work and informing us of the arsenic levels rising again. They're getting dangerously close to being totally unsafe. Supervisors, I would ask you to ask Hermosa to please disclose their information on their wells. If it's good, they shouldn't have any problem with disclosing it. But if it's bad, they'll do like they're doing right now and not let anybody know what's in those wells. Furthermore, in South 32's desperation for cash, they just recently sold their aluminum assets to Alcoa. And they're touted as, oh, now we can spend more time thinking about Hermosa. Well, they got to have the money because their budget is way over. Their schedules shock the heck. So anyway, manganese. We've been telling you for four years it wasn't going to be a viable product for batteries. Science has moved away from it. And now they're finally admitting it. So how many other things that we've been telling you for four years are slowly going to be admitted by this mining operation? Zinc extraction costs by their own numbers far exceed the costs of their competitors. So how can they compete? Zinc will end up being the same issue with manganese. They just can't compete on the market. I'm really surprised that there's not been a management change at the mine in light of all the budget and the scheduling issues. They're all blaming them on something else. They're not looking within to see that they didn't plan this project properly. They didn't do the scientific approach that they needed to do to understand the underground conditions. And so now they've got over a year delay of 50% plus increase in budget and it just, it's amazing that something hasn't changed out at the mine. They're all blaming others and the real problem is in-house. Poor planning, poor analysis. Supervisors, I would like to also ask you to verify with Unisource that they're being paid for the construction of this power line as they construct it. Hermosa is supposed to be paying for that and what I don't want to see is as I voiced a concern to the corporation commission back when we were doing the line siting issues that if they fizzle, if they're a flash in the pan, they go away we do not want the ratepayers being stuck with the bill of this infrastructure improvement so so please check with that and make sure they're paying that bill thank you thank you sir robin lucky

Good morning, Supervisors. Robin Leckie, President of the Calabasas Alliance, 1377 Camino Faja in Rio Rico. I want to take a minute to talk about, you know, We're getting close to, we're seeing this trend with arsenic, but I think as a former nurse, as a nutritionist, and a public health advocate, I'm going to talk a little bit about some of the health issues that can happen. So the timeline for the onset of arsenic poisoning from naturally occurring groundwater typically ranges from a few weeks to over five years. Depending heavily on the concentration of arsenic in the water, how much is consumed, because natural groundwater contamination usually involves low to moderate doses over time, it most frequently results in chronic arsenic poisoning, and that's a syndrome called arsenicosis, rather than immediate acute poisoning. Timeline onset, short-term subacute exposure two weeks or less. If a private well has exceptionally high unregulated levels of arsenic, initial health effects can service in less than 14 days. According to the Oregon Health Authority, this quick onset is especially true for infants and young children exposed to levels above 35 parts per billion. We're not anywhere near that yet. While adults may show symptoms quickly at levels above 130 parts per billion. Early signs include severe stomach pain, nausea, vomiting, and diarrhea. Early chronic exposure is one to three weeks. If the dose is consistent but not immediately lethal, early neurological symptoms like painful sensory motor, peripheral neuropathy, tingling numbness, burning in the hands and feet can develop within one to three weeks. A standard chronic exposure, five years plus, for the majority of people drinking naturally contaminated water at low to moderate levels, visible symptoms take approximately five years to appear. The World Health Organization notes that the first characteristic signs are dermal, including skin lesions, color changes, and hand patches, hyperkeratosis on the palms and soles of feet. Long-term complications, decades of exposure. Severe internal diseases such as cardiovascular disease, diabetes, various cancers, bladder, lung, liver, and skin generally take several decades of continuous exposure to manifest. So the key factors influencing the timeline, let me just stop there. I just want to remind you we live in one of the most diverse mineral rich places on earth and we know that we have arsenic naturally occurring in our water. A couple of weeks ago, the City of Nogales was talking about it, that we're seeing some elevated levels. So this is something that is important to the community and is important to us. And we too, so help is on the way, Chris Gardner. We too have become ADQ's Community Science Alliance members, and we're very happy to help in any way we can with our community. So thank you.

Thank you, Rob. Chris Workoven.

Good morning, Supervisors and everyone here. My name is Chris Workhoven, and the title of my presentation is EIS. You heard about it before. Impact claims are based on flawed ADEQ permits. The EIS is largely based on ADEQ permits, and as expected, serious lack of protection already identified during the ADEQ command processes got rubber-stamped now by CNF in the EIS. Related omissions and misrepresentations must be publicly addressed by an independent community science council free of conflict of interest. So let's start looking at ADQ's aquifer protection permit that vigorously denied metal mobilization as already demonstrated by USDS and the U of A more than 10 years ago.

And you just heard some other story about arsenic.

The EIS finally revealed that metal plumes can form after closure. The reported antimony exceedances of before prove this can happen already today. Concerning emission modeling for the ADEQ air permit , the commenter suggested use of best available lead fractions in haul road services admittedly caused a 2x emission increase of lead. Unlike a plain refusal of ADAQ, CNF attempts to explain how compliance to federal standards can still be claimed by pointing to possible other input changes, like weather or receptor locations. Very misleading, as good science does keep any other parameters constant across sensitivity analysis. Atmospheric metal deposition, another topic, will not be part, for instance, in the new ADAQ TMDL because deposition is claimed to be localized. Letting the public believe runoff of metal-containing material can be ignored, contrary to what is found in other states. CNF also refuses to publish societal costs for any increase in air pollution – and there will be increases, of course – even when the EPA has a ready-to-go software program available for years, much used in other countries, not in the U.S. Last but not least, our agencies admit also Probability of failure is more insightful to characterize tailings pile safety, but refuse to provide such a number simply because it's not required. So much for the protection offered till now. There's a lot of work to do. Thank you for your attention. Thank you.

Anne Dillinges?

Excuse me. Thank you, Board of Supervisors and the public here today. I'm here to talk about action items H3, discussion possible action to approve the possible retention of outside counsel for current or former employees and any spouses named as defendants in Auditor General versus Acuna, Maricopa County. Um, the reason that concerns me is professional law enforcement, special operations instructor. I had to carry insurance and I had to pay for it myself. Law enforcement insurance at several levels. I carry that today because I'm still engaged and involved. It's a lot of money and it's personal money and personal money. I also spent, uh, French special insurance for the agency that I worked for, even though it was a federal agency. If there's anybody on this list that's been involved in the Gotfar or any of the other cases, they need to be held accountable. It's simply impossible for only one person to have been indicted and to have been charged and held accountable. That's over a period of 13 years. We've had this discussion before when all this was happening. The optics of this is like a pre... the cases against these people, you know, whether they're involved or not, I don't know their names. But you guys have a tough decision ahead. I know you're going to an executive session to discuss this. Bob, I trust Bob, your attorney, you know, he's really on top of it, he's new. There's been a lot of systemic corruption within the county over a long period of time. Many of you are new and are quite honorable people in my dealings with you. So the optics on this, like I said, are really, really bad. It doesn't look good. It looks like you're trying to give a clearance to people that haven't even been charged yet in the public view. So, just caution you in that regard. The difference between doing the legal thing and the right thing are similar often, but can be different too. I wish that hadn't come up. Now, it's been brought to my attention that I don't know all the facts and all the details of the case, and I accept responsibility for that. but this does need to be looked at, and I wish you the best of luck, and I hope you're honorable in your decisions for this. So thank you very much for your time.

Thank you, sir. Thank you.

Oh, and one other thing. There's no way I could follow Jerry's earlier statements. He hit it.

Elizabeth Meek.

Good morning. My name is Elizabeth Meek. I reside in 1034 Pino Court, Rio Rico, Arizona. So Rio Rico is having lots of issues as well as the water and whatnot. Number one, thank you for providing us this platform to express our concerns. trash being one of the biggest things homes with excessive trash in yards that are clearly visible with furniture being discarded including refrigerators washers garbage bags on vacant lots littering littering where trash is thrown out of vehicle windows garbage being blown away by wind and not remaining in designated areas abandoned vehicles including the school bus on the side of the roads this has been going on for a while A solution enforcing the regulations and holding individuals accountable, imposing fines for violations, installing signs that prohibit littering in both English and Spanish, a hotline to report littering, fostering a sense of community and pride and responsibility in our communities. Another issue that we're having problems with is auto repair shops in residential areas. They're popping up everywhere. Numerous vehicles with hoods up in front yards, car batteries, engines, oil and gasoline spills, which poses a health risk. These issues are widespread due to a lack of accountability. Diminishes the value of our homes and creates an unsightly environment. Solutions, enforcing the regulation and imposing fines, preventing these problems before it becomes established by addressing it promptly upon the first complaint. Another problem we have is construction construction zone trash being left behind and not being contained during construction trash being blown into all of our neighborhoods solutions again enforcing regulations and imposing the fines. Another problem that we're starting to have is planning and zoning. Developers purchasing property at low prices, constructing on the cheap, homes being built on questionable zoning areas such as sloped hills, or flood zones, new home buyers complaining about homes with faulty plumbing, wood, flooding issues during the first rains. Solutions again, planning and zoning needs to improve and prioritize the wellbeing of our residents. Streets and safety. I've lived in Rio Rico for nearly three decades and the streets have never been resurfaced, only the potholes. Potholes are covered, but they reappear after the first rain. Neglected roads and overgrown brush. Sidewalks, particularly on main streets, are greatly needed. Additional overgrown brush obstructs visibility or signs, safety reflectors on our roads, posing a fire hazard. Solutions, again, enforcing regulation, imposing fines are necessary to address these issues. Please consider Rio Rico in the needs of our budgets. Community pride.

Ma'am, your three minutes is up.

I'll try to go quick.

Finish up, please.

Okay. And homeowners insurance infrastructure. Lack of infrastructure such as fire hydrants, overgrown brush has led to increase of homeowners insurance premiums skyrocketing. Addressing these issues is crucial in the long-term well-being of our community. After canvassing for several weeks, approximately 80% of the residents are complaining about the same thing, trash and auto repair shops popping up everywhere. So we would really appreciate if you can take all of these matters into effect.

Thank you.

Thank you.

Thank you, Liz. Bruce?

members of the board of supervisors and members of the public i wish you good morning and appreciate the opportunity to speak before you today i'm here because i want to protect the future of our community i believe an alternative proposal to the one you are pursuing on the expenditure override would be that you modify your outlook to six years while requesting funding. As such, you would be requesting 25% of your current proposal. And in doing so, you would build trust and engage with the community. You can always come back in any election cycle to request the additional funding you think you need. In addition, you should be looking at the taxing districts for health, recreation, and libraries. And the reasons are twofold. First, in doing so, you will lower the dollars spent in restricted portion of your budget, thus freeing the money for other priorities. And secondly, it is a very transparent way to do business. By this, I mean that the budgets for each district are discussed apart from the overall budget. examples of these districts that are working in our community are the college district the flood control district and the jail district and let me be clear this is not a tax increase as an example let's talk about a recreation district the board of supervisors could vote to put a recreation district on the ballot You could commit to lower the overall property tax rate by the initial amount that you are spending to support the Parks and Recreation as it is right now. Again, this would not affect your overall property tax that people are paying. This process allows you to hold forums, determine needs, and support for additional recreation in the county. If the voters agree with you that this is a priority and they vote to create the district, you will be creating a designated funding source for recreation in Santa Cruz County. Once you've dedicated the funding, once you've created that funding source, it gives you the ability to hold meetings, determine needs across the county for the facilities that your constituents want. You will be able to put a cost to your plan, propose the tax that will be needed to cover that, and then execute your plan. Again, this is all very transparent way to run government. Another tool you have in your tool chest is to create an enterprise fund to help you cover the cost of the IT department. Currently, it's a $2.7 million expense in your general budget. doing this you're probably going to come up with about four four and a half million dollars in savings in your general fund that gives you the space that you need to go six years with your lower expenditure limit request and it will allow you to be very transparent in what you're doing And in closing, I'd like to hear a little bit more about property tax reduction from the county. And you're anticipating revenues from new industries to support your override. And you've discussed things that you would like to spend tax dollars on. But you have not talked about property tax reduction. in one of the smallest counties in the state of arizona with one of the highest tax rates i'm concerned because i hear you talking about a three cent reduction over the next three three years but that's hardly going to cover the cost of the appraisal the increase in appraisals that we're going to be seeing so again thank you very much for your consideration have a good day thank you sir susan phobia

Thank you, Susan Fobian, 20 Kent Avenue, Rio Rico. Last week, I went into the HR department here requesting a job description for one of the elected positions. I was working on my primary ballot and I just wanted to really define because I wanted to know what the job description was. I was advised that if I didn't think somebody was doing a good job, I shouldn't vote for them. I was advised that there are no job descriptions for elected officials. I said that was stupid. As I reflect on it, I'm just gonna have to come up with, it defies logic. How can you not have a job description for a salaried position? And then I was thinking about it, and if there are no written job descriptions for elected officials, you know, treasurer is an elected official. Perhaps if Mrs. Gutphor had been given a job description, we wouldn't be 40 million in the hole. Thank you. And I do hope you're working on a sound ordinance.

Thank you. That concludes the slips that I, the speaker slips that I have. Is there anyone else who would like to get up and... Come on up, Wendy.

Thank you. Good morning Chairman Fanning, Board of Supervisors. I want to state that I'm certain that we all agree, all of us that live here should have input for the Community Protections and Benefits Agreement. I do want to point out that no one should have to answer 20 to 24 questions to do so on the CPBA website. So I'd like to request that that form be revised. I see that the website says there's input being accepted through August 7th. I'm just going to read some of the items that are requested. And I believe you can't move through until each one is answered. Type of input, specific concern or opportunity, basis for the concern, impact pathway, list of source, a pathway, a receptor, a consequence. Requested protection, trigger and response, recommended trigger, required response if triggered, timeline for response, who verifies completion, accountability, community support or offset, priority rating, defining an effective protection and final recommendation with another five steps. By all means, those are important. categories, correct? But I find that those are the job of the paid consultant, to get information and synthesize it. We've been saying for two to three years things that we would like to see in the CPPA, water, front-facing reports that the public can access. No one should have to go through this process, and I believe it's reasonable to state that an average citizen might not have the time or The wherewithal to to do that. So I would like to see that revised. Also, I would like to state that I would like to ask Mr Reisner how the multimodal facility that's coming down the Pike fits into the new plans. And I also would point out that taxpayer-funded legal representation would continue to erode public trust. I realize, too, that I don't know all the facts, but I just want to state that for the record. I do want to say thank you for the presentations here today. Thank you for your time.

Thank you.

Mr. Rodriguez. Good morning, sir. Good morning, board members. Good morning. Mr. Molera, Mr. Fanning, Mr. Davis. My name is Mario Rodriguez. I live at 757 Dorotea Court. I think that corresponds to District 2. First of all, I'd like to commend the Board of Supervisors for the declaration of the county's new identity. I think that's long overdue and it's a good job. As well as the implementation of new programs to include the mobile app like the click fix app. I'm sure you're familiar with that and that's what I'm here to kind of mention but before I go on with that I'd like to Come in miss Meek. She kind of stole my thunder there. I agree coming from my background I agree with all the points that she made and that's what I'm here to kind of talk about the click fix app the potholes That app it's kind of limited you kind of just click on it and it just refers you to the Public Works Department. So something like a suggestion would be something like maybe updated so that we could take pictures of specific potholes, maybe a specific location so that Public Works may prioritize projects. That would be a suggestion for that app. It's a very great, again, very good idea. But again, that's one of the issues that I'm here to talk about. Again, Ms. Beek brought them all up. The trash, the auto shops, the potholes. And then the other thing, is the landfill. The landfill on Camino Arbizu is borderline by a I don't even know if it has a fence, a barbed wire fence I think it has. And so on rainy, on windy or rainy days or stormy days, and those of us that live over there or drive by Camino Arbizu after the wind comes by or storms come by, it's... it's a plethora of plastic bags that's all that blows over from the landfill on to coming north east one down the hill towards the high school plastic bags and so the county management or the county the landfill people do a great job of coming up the next day and cleaning up but they spend most of the day doing that and i see those guys i'm kind of friends with them now because i stopped and helped them lot of the times so I think there's a better way of solving that issue maybe with a more permanent type of fencing or guarding that that area with a berm or some type of solution to prevent that a long-term longer-term solution of preventing that issue with the wind blowing the plastic bags from the landfill onto coming to out of you so instead of having those guys coming out there after every storm or windy day and picking up all those trash plastic bags so

thank you for your attention these things thank you sir thank you sir thank you for service any other folks wish to call to the public okay seeing none we will move forward to the current events I'm gonna turn to my left supervisor Mileta good morning

First and foremost, I want to send out my deepest condolences to the Frank Chino Calixto family. Mr. Calixto passed away yesterday. True class act, true gentleman. My prayers are with you, Chino, and to his family. With that said, I'll move on to other items. I want to thank Liz Meek and her neighbors for contacting us and calling with these issues out there. I want to thank Jesus and Colin, our planning director and our manager for going out there with myself and looking at it firsthand. There's some big issues. Trash is big. I know Shannon and I have been looking at it and we have a plan to have a study session to see how we can tackle this big issue that we have in Santa Cruz County. Ultimately, I think changing the mindset, changing the attitude of our community is huge. And that's just one issue. The other issue, like Liz mentioned, is the issue of these commercial auto shops popping up all over the place. They're illegal, and we're in the process of dealing with these. And thank you again, Liz. Thank you for bringing it up. We'll have continued dialogue, and we're going to take care of these problems. Mario, thank you for that suggestion on the click. I think it's a really good suggestion. We need to come up with a better method. I'm sure there is one. Thank you again. I'll go ahead and move on to an event we all attended. superintendent of schools Donley and Ms. Muñoz held a breakfast for their summer intern program. This program is about two years or three years in the making. They've done an exceptional job. Santa Cruz County students from high school come in and work with all our departments and programs. And I sat in some of these interviews that they had before they hired these kids, and wow. And I knew, because I'm a former educator. These kids we have in Santa Cruz County are amazing. And we're going to say hi to one later. We have amazing kids, and we're proud of it. And great program, Maya and Carrie. Good job. We also attended the Back to School Blitz, a great program where the whole community gets together to provide school materials for Santa Cruz Valley students. It's always a great program to take part in. And it's good to see the whole community involved. And lastly, we attended the Primaria Alta celebration of 1776 right after on Saturday. It was a great program. It's great. They're doing some amazing things with that museum. And that's all I have, Mr. Chair. Thank you, sir. Vice Chair?

good morning everyone so i've been writing my updates and and i found it very useful because we we forget about stuff and uh so yeah i'm not going to go into details when it comes to the breakfast because you already mentioned it but So, my first update is that I had the opportunity to attend the closing ceremony for the children's summer courses offered by El Centro Comunitario Los Nogales, the Nogales Community Center. During this event, the children showcased what they had learned in their modeling, capoeira, zumba, tai chi classes, and more. Many nonprofits also participated making the event even more engaging. The celebration was filled with families and a wide variety of activities. Congratulations to all the students on successfully completing this summer courses. The Santa Cruz County Health Department has established a heat release station at the Diamond House in downtown Nogales next to the post office. We visited the station and saw that it offers water, air conditioning, books to read, and a comfortable place where community members can cool off, especially during these extremely hot days. I want to thank the Santa Cruz County Health Department and the owners of Diamond House for collaborating and making this space available and providing a safe, welcoming place for the community members. The back to school bliss. the 17th annual back to school blaze for the santa cruz valley unified school district was held on saturday july 11 2026 at guatemala middle school the event helps students prepare for the upcoming school year by providing free school supplies to local families there's going to be another one at in at new galas high school i think and we're not going to be able to go because we're going to be at the nico conference but i'm going to miss that one i wish i could have been there Also, the Leaders in Training Program last Friday marked the conclusion of the 2026 Leaders in Training Program, which was offered through the Office of the Superintendent. I would like to extend my sincere thanks to Donna Lee, Lissete Montoya, Mandy Gonzalez, Carrie Munoz, and everybody who participated and helped make this outstanding summer program possible. The county campus will certainly feel different without many interns who brought so many energy throughout the summer. I wish the interns a successful school year as they return to their high school or continue their education journey in college. A little bit more. We met with We met with Felipe Garcia, president and CEO of Visit Tucson, to discuss opportunities and collaborations and regional tourism initiatives. He was very welcoming and shared valuable information and insight that could benefit Santa Cruz County. The Nogales-Santa Cruz County Chamber of Commerce, the Tubac Chamber of Commerce, the Sonorita-Algin Chamber of Commerce are the entities that support these initiatives. One of my goals is for the county and the chambers to collaborate for more robust tourist initiatives. Generaciones en Harmonia, which is, so yesterday I had the pleasure of attending Generaciones en Harmonia, which is Generations in Harmony, hosted by Circles of Peace at Morley Avenue. The event featured wonderful performance by the Santa Cruz County Council on Aging and YARA, Youth Against Drugs and Alcohol. who sang classical music songs by artists such as Los Absons and Leo Dan. Before each performance, participants share the history of the songs, inform about the composer, the artist, and the significance of each selection, making the experience both entertaining and educational. The goal of the event was to bring senior citizens and young people together, fostering meaningful connections and helping bridge the generational gap. One of the Circles of Peace organizers shared a message that resonated deeply with everyone in attendance. As you see yourself today, I once saw myself. And as you see me today, one day you will see yourself. It was a powerful reminder of the importance of respecting, learning from, and connecting across generations. It was a truly beautiful event and I look forward to attending again to the next time I'm invited. Film Industry Partnership. We welcome Monica Lopez, Senior Production Manager and Film Commissioner with Film Tucson, and Justin Cranbrick, Monsoon Production Owner to the Santa Cruz County Complex to explore potential filming opportunities. During their visit, we provided a tour of the Santa Cruz County Jail to showcase it as a potential filming location for future film and television projects. I would like to extend my sincere appreciation to the sheriff, the under sheriff, all the sheriff's officer staff for the hospitality and taking the time to provide an informative tour. Their willingness to highlight the facility and its unique features gave our visitors a first-hand look at the many possibilities for future film projects. A second tour is already being planned to introduce our guests additional locations throughout Santa Cruz County that could serve as a filming site. By continuing to promote our community to the film industry, we hope to attract more production, create new opportunities for local businesses and residents, and stimulate our local economy.

This is the last one.

We attended the America 250 University historical event hosted by Primeria Alta Museum. It was wonderful to see how many people from the community attended, learning about what life in Santa Cruz County was like 250 years ago, and gain a greater appreciation of our region, rich history, and culture heritage.

Those are my updates. Thank you, sir.

You're welcome.

A few. I have a few. First of all, we had the District 3 Advisory Committee. One person's here. Thank you, Gary, for being part of that. A lot of great discussion. I'd like to thank our Assessor Pablo and Mauricio for your presentations. I know there was one more, but... my mind I'd like to what's that animal control so thank you Jose I had an opportunity to meet with hope of deliverance representative Bree Kishman this week and we had some great conversations and she gave me some some ideas that I'll be meeting with County management to discuss a little bit more in depth um we had and i'd like to thank anna for being part of this the growing water smart meeting we had earlier this week or was it last week it kind of all melds together but for those of you who are concerned about water we are as well and we're going to continue to meet and come up with some solutions i was able to travel to bisbee to be at the governor's office of resiliency the infrastructure regarding energy. That was a great meeting. Learned a lot more about energy and how it affects citizens throughout the southern Arizona. Thank you to the county school superintendent for the leaders in training. It was an incredible month, I believe. Not only, you know, we were there for some of the interviews all the way up to the conclusion, so thank you so much for that. And like I mentioned during my presentation that day, let's see if we can't grow that a little bit. The back-to-school blitz, we've all mentioned it, but I do want to say thank you to Angie for putting that together. I know Audra was part of that, and I know she had a team that helped out with that. I arrived at 615. It didn't start until 8, and the line was already 50 yards away. deep for our families from Santa Cruz Valley and I wish the Nogales district all the luck in the world this week with their back to school activity. Primera Alta I would invite anyone to visit and if you don't know where it's at you can look it up online. I know the location. What is it? Morley Avenue. Morley Avenue. It's on the corner there across from Wells Fargo, if I'm not mistaken. But I've been there three or four times. I actually got to see my mother-in-law in one of the yearbooks, graduated from Gallus a long time ago. She's not old. Don't get me wrong on that. I shouldn't have said that, huh?

You're in trouble. This is being recorded, buddy. Yes, I am.

uh but uh is my face right um but it's an incredible um look into the past um from from what our county was like a long time ago highly recommend that yes sir something really quick for people to know the place because nougat is it's it's between wind stop and mcdonald's

Okay, there you go.

If you know those two spots, you're in good shape. I had an opportunity to meet with two folks from the Tucson Bird Alliance, so I was excited to meet with them. They have land adjacent to the checkpoint, and hopefully we can set up a meeting with some folks from CBP so that they can voice their concerns and their thoughts on that. So thank you to the Tucson Bird Alliance, Chamber of Southern Arizona. I'd like to thank Anita and Alma for all that you're going through right now in late nights and with the election. Thank you so much to you and your team. And get out and vote, please. If you haven't done so, please do so. And lastly, two happy birthdays on Friday. Happy birthday to Asus, our county manager. tomorrow happy birthday to my incredible bride Susie she's turning 30 something I think that should make up make amends for what I said earlier but happy birthday to my wife who's put up with me for a long time she's a gem and with that I'll turn it over to mr. manager

Mr. Chair, members of the board, in lieu of what's happening with the Humane Society, I met with the deputy county manager of Pima County, Steve Holmes. We discussed the possible collaboration with their animal control. And the other thing that we discussed is maybe they could do an evaluation of our operations to see how we can improve and maybe chart the future with the facilities. Also, I attended, I wanted to let everybody know there was a pre-bid at Pearson for the playground equipment. We identified an area where the hope is to maximize that area with playground equipment and provide a shade structure. That funding is coming from CDBG, so it doesn't cost the county taxpayers anything. Directly and last I just want to mention that starting next week We're going to start the repairs on the exterior of the building So please just keep in mind in case you come in here and there might be some new entrances or the front Enders entrance might not be available with the construction Thank you

thank you sir before we move on um i do want to thank the public um there was uh if i'm not mistaken and somebody can correct me if i'm wrong at this point in time the humane society is up to 140 000 with donations so we are incredibly um grateful to the community for looking out to what is incredibly important to our to our constituents so congratulations and thank you to any any of those any of you who have uh Donated whether it be monetary whether it be needs for our our pets That's fantastic and please continue to do so mr.

Chair one more item Just want to remind everybody in district one that today. Mr Davis is going to have his first advisory committee at five o'clock It's open to district one members, but if anybody wants to show up, please please do so and that's going to be here It's gonna be here

Yeah, from five to six. And just a quick comment to share. Yeah, I also want to thank Ms. Anita Moreno and Alma Schultz because they've been working really, really hard in this election. So thanks for everything that you guys do for the county.

Thank you, sir. Department updates? Excuse me, finance, cash, and investments, revenue reports. Ms. Martinez, are you going to be presenting today?

Good morning, Mr. Chair and members of the board. For the cash and investment report in the general fund, we have an overall balance of $25,335,629 with an invested amount of $16,970,364. In the road fund, we have an overall balance of $6,913,016 with an invested amount of $5,250,032. In the flood control district, we have an overall balance of $3,139,678 with an invested amount of $316,414. In the jail district we have an overall balance of $6,560,101 with an invested amount of $4,509,582. For a total overall balance of $66,392,762 and a invested amount of $29,220,773. And an estimated end of month balance of $14,003,954.

Thank you, madam.

Thank you.

Any questions?

No, sir. No, thank you. Thanks.

Thank you. Any other departments wishing to present?

Miss Anita.

Good morning, Mr. Chair and Chairman, board members, county staff, and the public. I've been getting calls and my staff has been getting calls with regards to the community that have not received ballots for this primary election. And just to remind the community that sometime last month all households received this postcard with all the pertinent information, including the early voting sites and the ballot drop boxes. And just yesterday we released a public statement just to remind the community members of their options of how they can vote being that we're just very close to election day and if you want to vote early we're still open until five o'clock today and tomorrow and on Friday we're open up until eight o'clock on Monday we have emergency voting so these are additional options I'm sorry, Friday is to 7 o'clock in the evening. So it's Friday, 8 to 7 o'clock in the evening. And just to let you know that these are additional options that you all have because we are getting calls on a daily basis that voters have not received their ballot. Thank you.

Thank you very much. And for those of you who are here today who have not voted, Anita, is there a place they can vote here today? Right now? Yep.

Sweet.

thank you madam wonderful thank you thank you any other department yes please

Thank you. And if I may add, if you have not received your early ballot, make sure to check your mail. You might still receive it. And if you do receive it, you can still drop it off at any drop box up to election day at 7 p.m. is when those drop boxes close. Or you could also turn it in at a voting location on election day up to 7 p.m. Thank you.

Thank you, madam.

Good morning. Good morning, Chairman Fanning, Supervisor Davis, Supervisor Molina, county management, members of the community. My name is Maya Donnelly. I'm the school superintendent. Just a quick department update. Wrapping up our summer in our office and lots of great things have gone on. You all mentioned lit, so I won't mention that again. But we've had some amazing camps. In fact, these are the last two weeks. Next week we'll wrap up. On the tail end here of camps, we've got a writer's institute that was featured on KOLD News that's pretty amazing, offered by Joe Wright. This week we have a youth empowerment and parent empowerment camp going on at the community college. That's actually put on by our own Terry Sprigg and Lisette Montoya. and it prepares kids and parents for a brand new school year, social-emotional awareness, and mental well-being. New school year is tough, right? We have 4H camps going on at the Rio Rico Farm on the upcoming Saturdays. AZCyber is an amazing opportunity for our middle and high school students to learn about cybersecurity, and that one is put on by one of our own Nogales High School alumni, Manny Felix. It's an amazing opportunity. And then we've added our sixth mural to our murals on Morley Summer Camp and expanded to Tubac. So at the Ron Morris Park, you can see the latest mural by Miguel Grijalva, who's a Rio Rico High School art teacher and his students. It was actually recommended by the Hawk Watchers Club. So it's beautiful. If you're ever out in the Tubac area, go check that out. We're proud of that. Also the back to school activities. Our office does not only support Nogales Unified and Santa Cruz Valley with their, they have big main events, but our districts on the east part of the county as well, Little Red, both Patagonia's elementary and high school, and then Sonoyta. Our office earmarks $15,000 out of our forest fees to provide upwards of 900 backpacks and lots of school supplies for all of those families in need across the county. So that's amazing. We've got Teacher of the Year coming up August 7th. Don't forget to buy your tickets. It's a community celebration of our educators. 21 honorees from across the county. and it's an incredible way to kick off a brand new school year and then lastly on in our fiscal side we've been working really closely with the treasurer's office and all of our district business managers not only on the transfer to the new bank and the new treasury system the new data system but on tax rates. So it's that time again to determine the fiscal year 27 tax rates for school districts and as in a previous presentation when I joined Alejandro up here we talked about how we were going to make improvements to this process determining tax rates and so we did have one-on-one meetings with all five district superintendents Alejandro and Bettina, Carrie and I And we went over line by line the tax workbook provided by PTAC, the Primary Tax Oversight Commission. And so in an effort to not have any errors or changes later after you certify them, we're trying to eliminate those kinds of things. So we did go over them. We also have our county spreadsheet ready for you, Mauricio. And so we're very proud of that to get those things off our plates. Any questions?

No, just thank you. Thank you for all the great programs you guys are putting together, and thank you very much. Okay.

Can I still apply for that CAM program for parents to get ready for back to school?

There's three days left, Luis Carlos. You better hurry.

Okay.

Thank you.

Thank you for all you do.

Hey, Maya, I forgot to mention one thing. There's a couple walls, small walls in Chula Vista. Oh, yes. Yeah, you mentioned that to me.

You're on the list.

Perfect. Thank you. Thank you.

Thank you. Any other departments? Come on up, sir.

Good morning, Mr. Chair, Mr. Davis, Mr. Molina, morning management members of the public. I just want to provide an update on our system transition, the treasure system transition. That's why I was speaking to, um, as of right now, we are still looking good. We're looking to go live on Monday. If you pass by our office or any constituents pass, it might look a little dark, it might seem like it's closed. We're still there and we're still servicing everybody. But we are in full mode training right now, live training with the CollectWare system providers. And we're having a lot of great aha moments, almost sometimes even in tears of how amazing the system is and how well it's going to work for us in comparison to our old and vintage system. So we're very excited. I also want to thank the constituents, the departments for being patient with us during this blackout period. We're not seeing as many constituents walk into our location. I must have read the website or the press release that we are in a blackout period. So we rather they hold their payments until we are live so that we can process them live. So just want to show that we have that update. I also want to thank Maya and Carrie for working with us. And help in allowing us to be a part of their business manager meetings and superintendent meetings for the tax rates so that we can follow along through that PTOC worksheet that we don't typically see or view in our office. And we can get a greater understanding of what we receive for the final product that then we turn into what is their favorite part, the tax bill. So any questions? No, just thank you.

More than anything, seeing how that program is running, wanted to make you cry. It doesn't want to make me cry, but it makes me feel good.

Knowing that you have that feeling.

The current old venture system makes us cry every day for different reasons. This new system is making us cry because it's wonderful. It's amazing.

The other day we walked by and I saw everybody in his office. with the big monitor and I thought they were watching a movie so I went in and they were just working in the program so no thanks for doing that.

Alejandro can you please explain so are counties unique when it comes to our school districts? Most school districts go through the superintendents of schools right for the tax rate and all their warrants and For the exception of one, I think. Can you elaborate?

Yeah. So NUSD is a pilot district. And so they work on their own independently. They don't go through the school superintendents like all the other school districts do. So they transfer their information directly to the treasurer's office instead of using the superintendents as the middle guy, right? There is some delays that will happen with NUSD. Part of it is due to information just passed on to us. It is related to their warrants. We have worked with Collector, our new system provider. Again, another reason why they are amazing. They're able to have a workaround where they're able to continue to produce their files as they've been doing so that we can continue to provide the service for them. However, the permanent solution is going to be delayed for them. We ran into some hiccups. There's some agreements that have been requested, some more clarification for peace of mind. And so we want to make sure we provide them that is solely their decision and only they can decide how they proceed. And so it doesn't delay or affect the treasurer's office in any way. But there is that difference between NUSD and the school superintendent's office and all the other school districts.

Quick question. So that delay would be just now that that new system is being implemented or that's how it's going to be like from now on?

No, it's temporary and the delay and it's kind of confusing because they're not technically delayed. We're still servicing them. We're still processing. We're registering their issued warrants and then we'll be processing their cleared warrants using their old file because we kind of forced our new system to work their system to meet those specifications. The reason they're going to be delayed is for the permanent solution because they do have to change the way they share that information with us and what information they're sharing with us. And so they're kind of having a little bit of a speed bump in grasping that concept and understanding it well. So we're just making sure that CollectWare, Tyler, who is their service provider, is providing them with the service agreements that they've requested and answering any and all questions to provide them peace of mind to move forward.

One last question. So after you implement this new program, right, are there other stuff pending, other stuff that you have to work or basically? No. No?

No.

Okay.

We're good. We're good to go.

Thank you for all you do.

Thanks to you and your team.

Thank you, guys. Thank you, sir. Shannon? We're almost there, Roderick. All right.

I'll make it really quick. I just wanted to, Manuel, if you could bring up the slide. I just wanted to say, well, good morning to supervisors, staff, and members of the community. Santa Cruz County, we are members of the County Supervisors Association, and they send us regularly updates on legislative and budget activities that are happening, that affect counties across the state of Arizona. So today I just wanted to give a brief update. Maybe we can do a regular update just to kind of pull down some of that stuff that impacts us. And I'll make it brief. The first thing are the direct impacts, which you can see. the appropriations for Santa Cruz County we're gonna get well let me back up so in June the governor signed the FY 27 budget so these are the things that are directly going to impact us so the sheriff's support funding we're gonna get $300,000 for public safety operations we're gonna get a small contribution for reimbursement for the detention corrections officer retirement contribution For our contribution, it established the contribution for the Altex, which is the long-term healthcare fund for Arizona. That is something that we are required to contribute to, and they established our rate at 3.79, and that's an increase from last year. I'm not sure how much of an increase, but I know it is an increase. Mauricio could probably answer that if you like.

Mr. Chairman, members of the board, every year the and the acute care which is the access portion of our requirement that we have to pay the state goes up. This year's not any different. That amount went up about $300,000.

so those are the things um the direct the money impact uh some of statewide programs that have opened up that we might be eligible to access are as you can see uh there's 13.2 million for border support there's some county fair funding environmental county grants and rural water study grants or funding so those are things that we'll continue to watch and pursue if we are eligible and if the board so Fancies so we'll keep you updated on that. The only other thing I wanted to mention that I did not put up there was some of the county measures that we receive on regular update. I just thought it was interesting that as far as the expenditure limit goes. grant and I think it was in Mauricio's presentation but Graham County is seeking an expenditure limit adjustment of four million Pima County is seeking 70 million Santa Cruz County 1.5 And Yuma County, 6.2. So I thought that was interesting and just, like I said, things that we'll continue to track and bring up as it pertains to Santa Cruz County. Any questions?

Sir? No, thank you. Thank you for this update. Sure.

Thank you.

Okay.

Yeah, and I'd like to see this on a monthly basis, especially with you attending CSA. I think very valuable information that probably most of the folks in here aren't aware of, so that's great. Thank you. Very good.

Thank you.

What do we do every two weeks?

Any other department? Okay, number three, recognition of Roderick Garcia for his outstanding performance singing the national anthem at the Santa Cruz County Peace Officer Memorial Center ceremony on May 15th, 2026. I'm going to turn it over to Supervisor Maleta. I'm sure if you want Roderick and his mom to.

Yes, if you can go up to the podium please. You know, unfortunately, we're not going to have him sing today.

Little capella?

But just for the record, I listen to a lot of renditions locally, including my wife. She used to sing the national anthem for our basketball program. And just students over the years. But Roderick... really caught my ear at the Peace Officer Memorial. Just flawless, just natural, incredible rendition of the National Anthem. So congratulations, Roderick. Right after that event, I approached our chairman and I said, Chairman, we need to recognize this individual. And what an amazing job. So we have a certificate for you and a challenge coin. The certificate reads as follows. Certificate of recognition presented to Roderick Garcia for his outstanding performance singing the national anthem at the Santa Cruz County Peace Officer Memorial Ceremony. on May 15, 2026. And we have a challenge coin for you, and we just want to challenge you to continue developing your awesome skills. Okay, Roderick? Do you have anything to say? Would you like to? As a matter of fact, he's only 10 years old, you guys.

I just say thank you. Thank you. And, yeah, that's it.

Before he comes up, do you have anything?

I'll say it. Okay. And before you sit down, supervisor, I couldn't agree more with both of you guys. And he's and I know he's also like a really good at GG. So he goes with the kids. And that was the video that had seen like before they pass around when he sang at this event. So yeah, congratulations.

Congratulations, sir. We also heard you sing at the community days of the National Anthem, if I'm not mistaken. So I know how difficult that is. So I commend you for a job well done. And I know that you and I spoke, Ms. Garcia and I are part of the Rio Rico Rotary together. And I believe I asked her, did he get his singing prowess from you? Wonderful. Very good. Congratulations again, Roderick.

Job well done.

Okay, we're going to move on. We're going to move from F right into G, study session. We will come back to the executive session at the very end. That way, for those people who do not want to stick around, they can go after the consent agenda. So we'll go to item G, study session. The purpose of the study session is to receive information, review materials, and engage in detailed discussion. the matter presented number one South 32 or Mosa quarterly update by Pat Reisner president of South 32 or Mosa and we'll give it we'll give everyone a chance to those folks who are departing Sir, the floor is yours.

All right. Thank you, Chairman. Thank you, Supervisor Davis, Supervisor Mullera, Supervisor Fanning, members of the public. As always, we appreciate the opportunity to provide this update, as we've committed to quarterly for a few years now. I do want to start the commitment we made I think a couple of years ago in terms of the format of these is that we would take notes during call to the public and any issues raised around SAL 32 or the Hermosa project that I would address them and they're in my presentation or if they're not in my presentation right up front. I've been feverishly taking notes. Quite a bit of what came up I think I can address in the course of the presentation. But I am going to go through a few of these up front that aren't in the presentation but I can address now. And then I'll get into the content if that's okay. So a number of things raised that were just points that probably not able to respond to, but certainly noted in listening. I think starting with some of the comments that Anna Darien raised, quite a bit on the EIS. I have a slide on the EIS, so I'll talk a little bit about some of that as well. Probably the two things that came up that were raised, specific questions that are not in the PAC that I think I can go ahead and address up front. Just the questions about the project narrative and the national security challenges and wanting a full explanation of the supply chain. You know, positioning this project as important to address national security risk is not new at all. If you look at the critical minerals list that the federal government designates, which is about security and supply chains, The commodities we'll produce, primarily zinc and manganese, have been some of the more problematic in terms of reliance on not just foreign sources but geopolitical foes, so that's not new. In terms of how it meets a domestic need, I'll have to speak about it in two parts. So first of all, and I'll get to manganese later because there were some questions raised about that and I have a little bit on my presentation. The manganese project, it would be mined and processed domestically, targeting a domestic North American market. So the reason the manganese project is delayed and deferred, hasn't moved forward, has nothing to do with whether manganese is being used in batteries. It's that the midstream of the supply chain for batteries, so the companies that take our materials, manufacture it for material that goes into cathode, has not onshore it into the U.S. yet. If that doesn't happen, that won't be developed. And so that absolutely is – it would be mined and processed locally into a high-purity manganese that would be sold to a domestic, i.e., North American cathode producer and into a U.S. battery producer. That middle part of the supply chain, the cathode production, is not onshore yet, so that's why the project's delayed and a little bit behind the rest of the project at the moment. On the zinc side, it's a different story. We'll produce metal concentrates with the zinc processing facility that's on site. Those concentrates have to be smelted into refined metal for use. The plan we have for that does meet a domestic need, so I think it's probably quite well known that 90% of the critical minerals in the world are smelted or refined in places like China. However, there's two options we have in North America to ensure it stays onshore. There are two smelters in Canada and one in Mexico. We have letters of intent with several of those smelters. The intent is the zinc we would produce on site would go to those smelters for smelting and refining. 85-plus percent of the output of those facilities serves the U.S. market since we haven't had zinc-smelting domestic capacity. We have to get it from somewhere. It's primarily from Canadian and Mexican smelters, some from South Korean smelters, but it will be smelted in North America and either Canada or Mexico for a U.S. domestic need. There's also a second part to that. You may have seen, I think it was in December, the federal government announced a significant partnership and investment to revive the zinc smelter in Tennessee that used to be owned by NeerStar. The federal government will be a partner in that project. They're investing quite a bit of money to create zinc smelting capacity there. That will also be an option for us. So it will either be Tennessee or the three smelters in North America that meet domestic needs. So it does not leave North America and it meets a U.S. need in that way. The second question that came back and just by the way like probably the easiest thing to do would be to ship it to China because that's where all the capacity is but we've committed because it's a critical mineral to meet a domestic need that's where our placement would be and we already have letters of intent in place to do that. Timeline on the CPBA was the other thing was recognized or raised. I'll talk about the schedule announcements that we made on a subsequent slide. So I won't get into that right now. But the question was how does it affect the CPBA timeline? Not at all. So the CPBA timeline is not tied to the pace of development of the project. We're moving along. We've been waiting on the EIS to come out so we can start to work on protections. That will advance quite quickly. And we'll hopefully get to the point where we can execute that agreement end of this year, early next year. And that is completely independent of the pace of construction of the project. The early actions are not, to my knowledge, dependent on anything around the pace of development of the project. There are some studies that needed to be done to inform additional actions that would need to be taken in the future. So there's a lot of those types of projects. But our ability to move forward on the second phase of those is not tied – the long and short of it is the CPBA is not tied to the development timeline of the project in terms of signing it and being able to move forward. So Mr. Gardner's comments about arsenic, I am going to revisit the antimony discussion in my slides. I think it's important to reflect on the journey we went on on antimony from sort of November, December last year through the spring of this year as we now have another issue raised. And I think – so the long and short of it is we're going to talk a little bit about arsenic and antimony on these slides. This is right where we were last November, December, when the same kinds of concerns were raised around antimony based on, you know, one sample out of our process plant – or out of our water treatment plant. allegations of mobilizing metals and sediments downstream uh we made modifications to our our water treatment plant um it's a little bit of a different story around arsenic i have seen the analysis that mr gardner's referred to that he's done to form the conclusions All I would say is I think before anybody reacts, it was very important that somebody do an independent review of that analysis. There's postulations and conclusions formed from two data points. There's trends into the future from two data points. If you look at federal agencies like USGS, their standards say you can't formulate a trend with anything less than 10 data points. And in many of those cases, all of the data we have on arsenic, just like I did in January, I put charts up there for antimony, showed our data. I'm happy to do that again. But all of our data on arsenic downstream is flat or declining. And we will share that in a public meeting, just like we did with antimony. We showed at that time that we weren't seeing mobilization of antimony downstream. We have 16 wells downstream, arsenics flat or declining. Happy to share that data other than about half of those wells are private wells where the data is provided to the private well owner. We don't have the rights to share it, but if they're willing to share it with you, we will. But we can put the anonymized data on the screen in a public meeting. Happy to do that because it actually shows flat or declining trends around arsenic. There's some statements in the PAC that are countered information we've provided Mr. Gardner in the past around leaching. There's leaching analysis in the EIS. It was not ignored. I put the analysis that was done on leaching in the EIS on this screen in January when we were talking about antimony as well. So happy to be transparent and show that data just like we did with antimony back in January. But everything we said was going to happen around reducing antimony levels has happened. And I would, in our view, the notion that arsenic levels are being mobilized and we're seeing rising levels is a false conclusion based on the data and happy to engage in that discussion. the next update and offline and even if someone wants to contact us and have discussions outside this session to go through that in more detail happy to do it the last part of Mr. Gardner's comments about sharing well data with private owners putting protections in place. That's exactly what our well protection program is doing. Of those 16 wells downstream in Harshaw Creek, at least half of those are private wells that we're monitoring and we have protection agreements in place. Most of the people we offered well protection agreements to have now signed. So I think a lot of that is continuing to progress in the way that was suggested. And absolutely the CPBA is another opportunity to look at these things. The other thing I would say is our well monitoring and well protection program for private wells is now a binding commitment in the final EIS. So happy to continue the discussions around arsenic, but this is where we were back in December on antimony. We demonstrated that was not a valid conclusion, and I think that's where we're going again on this one, and happy to show the data and talk through that. Mr. Edwards, I'll talk about a lot of the comments about our project update, capital cost schedule. I have a slide on that, so I'll go into that a bit more. But I do want to get to the comments about manganese and batteries. I touched on it before. The notion that we're admitting now that manganese is not viable for batteries, there's certainly no truth to that. Actually, if you go grab the data, there's significant construction of precathode and cathode manufacturing facilities going on around the world with an increasing use of manganese. Now that we move to battery storage for renewables, they're talking about lithium manganese-rich chemistries that are 65% manganese as opposed to 10% historically. So the trend's actually in the other direction, particularly as we move towards storage. What's not happened is those facilities are not being built in the United States and North America. They're being built in places like South Korea, Japan, Morocco, other locations like that. So it's not a matter of manganese being viable in batteries. There's data and information out there to show that that's only increasing. It's are we going to do it in the U.S. or not. And if that doesn't happen in the U.S., we won't mine the manganese resource because to the question that Ms. Darien raised about meeting domestic need, the manganese project is to meet a domestic need. So if we don't manufacture cathode in the United States, it won't be developed. So it's really a timing issue of when and if that happens. But there is significant investment and build-out of cathode manufacturing going on around the world to utilize manganese in batteries. On the zinc cost issue that was raised, it is just simply not a true statement to say this zinc project can't compete and its costs are not competitive. I could point you to some publicly available presentations, but I'm also happy to email it to anybody that wants it. This is the global zinc production cost curve. Hermosa, even with this cost increase, will be in the lowest cost quartile of production globally. And that's mainly because of the significance of the deposit. As we've said before, it's one of the largest undeveloped zinc deposits in the world. And even with this increase, it remains in the lowest cost quartile of the production cost curve. I'm happy to send that out if anybody wants to see that. And absolutely, verification with UNSC that we're paying the bill. It's already paid. We paid for the power line up front. So happy if anyone wants to reach out and verify that with Unisource. Robin Lucky comments around arsenic. Again, happy to have meetings offline. Our data is not showing increasing levels of arsenic, either in groundwater or in surface water. And we'll put the same information up we did on antimony. I think the important point of what Robin talked about was the fact that the risks here are chronic exposures. That's exactly the point I made in January on antimony. We had one exceedance in a grab sample over one hour in a three-year operating window of the water treatment plant, and there was plenty of data to show there was not chronic high levels of antimony. Same applies to arsenic, but in this case, we actually aren't seeing increasing levels of arsenic. Mr. Workhoven. Not going to probably go into the state permit issues. All the state permits have been through multiple levels of administrative appeals, judicial reviews. They've been held up at every level. And these are issues I've raised in the past or I've addressed in the past. The one different one that came up today was around tailings safety. The only thing I'd comment on that is we've built the first new dry stack tailings facility in the United States. Because it has low moisture and compaction, it is the safest, most stable form of surface tailings storage that you can have, and there's not another facility like it in the world. So I think we've gone to the highest end of controls around that particular issue. but happy to talk about that one more offline as well. Wendy Eastless, Wendy caught me before the meeting about the issues with the CPBA input form. We can talk about that in our CPBA meetings, so take that, it's noted. I think the only thing I would say is part of the rationale for the form is it's hard for us when we take input, if we say we've been saying for years what we need, we need water, I think the form is intended to get things as specific as possible so we can action things and move forward but happy to talk about improvements to that and then the last one that Wendy raised the multimodal facility so we don't right now we aren't engaged in any work on a multimodal facility in Santa Cruz County it's come up in the past What I would point you to on that is a multimodal facility in Santa Cruz County was on the Nogales Port Authority strategic plan 20 years ago Its inception predates South 32 by 15 years probably It's not a South 32 project. It didn't start as a South 32 project and right now we're not engaged in anything on a multimodal facility so I know it's been out there for a while. If there were one, would it be something that mining companies would probably be interested in using? Probably, but we're not pushing that one forward at this time. So I'd probably refer you to the Port Authority and others that work on those projects. Okay, I'll address everything else as we go through the presentation. A little bit hard to see with the lighting in the room, but I want to give a few construction updates so people know what's going on at site, and I'll have some images up while I do that. This is a recent photo of site just a few things The project is about 50% through construction. We have reset the schedule based on the update that was released in April And we're about halfway done at this point we have just over 900 people working in construction about 300 on site at any given time because it's a 24 7 operation but that is the peak construction workforce that will continue until about july august of next year so about 12 more months at that level the first shaft reaches the lowest mining level in september and the second in october so we're getting to the end of the shaft development phase in the upper left hand corner you see the zinc processing facility construction occurring that's the big focus of activity and in the lower right hand corner we're starting to do work on some other infrastructure to support the underground backfill operations that we've talked about in the past and the equipment that we'll use to dewater the tailings to allow us to recycle the processed water out of the plant which is what gives us the low water consumption for the operation the other thing we announced in april is the decline that we developed to access the manganese deposit underground that completed about christmas time that we're going to restart that and extend it and connect it into the zinc deposit so that's underway as well so we'll have access from both the shafts and the zinc deposits so primary activities zinc processing facility construction. We're just about to the end of sinking the shafts and then developing the other ancillary infrastructure on site. This is just a zoomed in from the other direction from the west looking at the zinc processing facility. Just consistent with my answers earlier to Ms. Darien's questions, What this facility will produce is not a smelter. It basically takes the ore that we mine underground, which comes out about the size of your fist. It reduces it in size and then separates the metal from the rock and produces a concentrate that's about 55% zinc that then goes to a smelter to be refined into finished zinc. So one of the really important things about our design is none of the ore that comes out of the ground is exposed to the air or the atmosphere. So this is a very large coarse ore bin that will fully contain all the ore while it's waiting to be processed. This is the circuit that separates the metal from the rock. So that's progressing. And that's about it on that one. So I did want to show this. One of the things that is in the final record of decision in the final EIS is construction of the 138 kilovolt power line that Unisource is building, the one I referred to that we have fully funded. Unisource has also built this substation on the site. This will be the terminus of the 138 kilovolt line. at the top end of Flux Canyon on our private land. That construction's done. I think the importance of the power line in the context of the project is right now we're supplementing power generation with compressed natural gas units on site. That means hauling natural gas via truck through the community. Traffic is a serious concern for the community. The sooner we get on line power, those trucks come off the road and it eliminates natural gas related traffic. So the construction of the power line on private lands is well advanced. The substation at the end is well advanced. The EIS authorizes the last six or seven miles of that line. Centro I want to just give a brief update on Centro construction on the left is kind of an overhead view we finished the roads the foundations have been poured that that facility will be done August of next year so we're only about 12 or 13 months away from construction completion it will be Opened in September of next year and fully operational before the end of the year. So you will start to see things developing quite quickly there from where we're at today. As we've said before, more than 200 people will work here, not at the mine. And we will also have a park and ride because we do bus everyone to the site so that we don't have traffic on the roads. And there'll be a park and ride here for employees that live in the Nogales, Rio Rico area to be bused to site. We've recently released some renderings of what the inside of Centro looks like. So that's available out in the community as well. Okay, I want to talk about the project update, and there were a few questions that came up around this. So we had always planned about the time we were getting close to 50% complete on the project when we had all of the work we were doing largely contracted, so at least 80% of the work contracted, so there was... full understanding of what things were going to cost to do a review of this nature and we committed to the market that we would do that and release it quite some time ago. So we did do that at the end of April. So if you look at this, so if you remember when we authorized the project, so our board decided to move forward with construction of the project in February of 2024. What that meant is the feasibility study schedule and cost estimates for the project were done second half of 2023. So this is sort of reflective of the three-year gap. Several things happened in that three-year gap. The war in the Middle East has had a significant impact on supply chains for electrical transformers, switchgears, big electrical infrastructure that we use to build these projects. The tariff and trade policy changes with the Trump administration coming into office has made, has sort of forced a run on things like domestic steel, but we don't have sufficient capacity, so the price has gone up, and other sort of tariff and trade policy issues. Commensurate with that, there's also been significant data center construction increases. The end result is the unit cost, the cost per ton of installed steel is two and a half times what it was in 2023. Piping installations 2.2 times what it was in 2023 because of raw material costs. You're actually seeing that as well in the commodity prices. So if you look at, Wilberna produced silver. So silver was about $23 was the price in 2023. It's touched $100, $80 recently. So you're even seeing it in the underlying commodity prices. So that's a big chunk of the schedule shift. If you look at new greenfield mining development projects around the U.S. You're seeing this. The average cost increase is 40 to probably 70% range, so we're in that range as well. One of the things I do want to clarify, I've had a lot of questions. I know there's people been talking a little in the community suggesting that this might put the project under review or under pressure. What does it mean? Is it going to go forward? Are we still committed? When we announced this new capital cost in April, Our board had already approved the additional capital that had already been reviewed, that already recommitted to the project and the investment. We don't put announcements like that out without having decided that we're going to carry on. There'd also been engagement with all of our investors on that at that point. So the investment fundamentals are still sound. If anything, the criticality of the supply chains as evidenced by scarcity and the price of things like, go look at the zinc prices, the silver prices, The reason they're going up is because the supply side's dropping off and demand is increasing. If anything, that gap has grown significantly in the last three years. So it makes not only the national security and strategic rationale of developing the project more sound, but it also suggests that we need to, from an investment standpoint, do more projects like this. A few other things that we announced at the time. The mine life for the zinc project increased by five years because the deposit has grown. We've continued to drill out the resource with exploration drilling. The zinc deposit grew by 10%. The copper deposit that's adjacent to the zinc deposit that we've been working on grew by almost a little over 30%. And the schedule impacts of all of this. So I've been saying for a year and a half now that first underground production would be in 2027. It's still in 2027, but it shifted from April timeframe to November. So we're still less than 18 months away from first underground zinc production. The first product through the plant would then be around March of 2028. None of this changes anything with respect to the CPBA, as I said in the Q&A at the start. None of this changes anything around our commitments to community programs, community investments, social investments that we've already announced and committed to previously. So that's a really important point. The second thing, just another bit of corporate news, and this is where I'll get into some of Mr. Edwards' other points and questions. A couple of weeks ago, the company announced that it was selling its aluminum business. So if you go back and read the news 2015, 16, 17 timeframe, South32 made it very clear that they were gonna go through a portfolio transformation back in that timeframe. And what that meant is selling assets that were not in what we call base metals, so the production of metals that are needed for decarbonization, low carbon future, the energy transition, all of those sorts of things. They were very clear that that's what we wanted to produce going forward. That is zinc, that is copper, that is silver, things like that primarily. And they made very clear that anything that didn't fit that portfolio would be exited at some point. So we sold our energy coal business, we sold our metallurgical coal business, we sold all our manganese smelting business, and the aluminum business was always going to go because it was not a preferred commodity for South 32 because the supply-demand fundamentals are very different because it's driven by different demand drivers. We want to produce the things that are important for that energy transition low-carbon future So this had nothing to do with our cost increase The way Hermosa is funded is all of the operating cash flows from the existing mining operations We have around the world are invested here This doesn't change that at all. We're still self funding this what's different about that is most of the other developers in the region have to go to banks and financial institutions or even the federal government to get loans to develop this. So this project is being fully funded by operating cash flow and this sale doesn't affect that at all. So it was part of a portfolio transformation strategy. It was not to fund our activities or our work. So just want to revisit this because it's kind of the first update I've given since we had several months of conversations around antimony. I want to explain what happened. A lot of the concerns were raised. We had three public meetings here in the board about it. We committed at the time to do two phases of upgrades to our water treatment plant. We've spent about $700,000 on those upgrades. It is working. If you remember, the permit requirement is below six parts per billion, which is a drinking water standard. We've had one sample in three years that was 6.2, but we committed to add additional controls, and I talked about the plant being flexible enough to adapt to changing incoming water quality. So every analysis we've done since the new controls were put in place has been between one and two parts per billion, so a third of the standard. So it is working, just as we said it would work. The downstream water quality analysis in the wells and the surface water continue to remain low. And this is my challenge on the arsenic issue. We're kind of right back where we were in November, December last year. We don't think the data is showing increasing levels of arsenic. Happy to talk about that. But let's make sure we understand the issue and what is and isn't happening. And then we have some independent verification of that and happy to work with the board and anybody else on that. But this has been quite successful and we still have the ability to do real-time analysis. So we understand incoming water quality on a two-hourly basis from the wells. One issue that was raised by several stakeholders last time was you need an on-site lab. We've always had an on-site lab for the last three years. That lab is processing samples so that we can adjust how we operate the plant to meet the standards. The only other update from previous issues I just wanted to talk about, I think some of you have participated in some of the public input sessions around the baseline health impact analysis that the University of Arizona is doing. Thank you for your input on that. The first part of that, the baseline assessment, will be ready mid-August, and we expect the full assessment by October. So that's progressing well. One of the things I did want to provide a little bit of an update on, now that the EIS is done, we get a lot of questions about traffic. One of the things that's important to talk about, and the reason I raise this is we know, along with water and several other environmental issues, this is a concern many in the community have. We've made decisions to bus people to site. We're doing modular construction, which reduces construction traffic by about 80%. But one of the things I want to be clear about, because a lot of stakeholders and members of the community are using the numbers from the environmental impact statement in estimating traffic volumes, and that's understandable. That's the primary publicly available source. I did want to make a few clarifications around what we actually expect now. As you can imagine, in the EIS, we have to analyze and look at the maximum case scenario. So how much could it be and what would that impact have? So those traffic numbers assumed full production of zinc, full production of manganese, and no power line. So they assumed we would be hauling natural gas to site forever for compressed natural gas generation. With the record of decision in hand now, then the 138 kilovolt power line can be complete. That immediately will take 50 plus trucks a day off the road for hauling natural gas once that's complete. So that's an immediate big reduction. And then I've talked about manganese at length in terms of where we're at. So whether manganese mining is actually going to occur here or not is still yet to be determined. As I said, it depends if that capacity gets built in the United States or not. But right now, there's no decision to mine manganese. We will just be mining zinc. And so if you take the manganese traffic off the road and the natural gas traffic off the road, it's about a 45% reduction in heavy truck and total traffic. And so just wanted to make that clear as we go forward and start talking about traffic in the CPBA and things like that. That's a really important update and development because the natural gas vehicles will come off the road and at this point we don't expect the manganese traffic to be on the road unless something changes in the future. Talk about the final record of decision on the EIS. I'll come back to some of the questions that were raised around this in call to the public as well. The first thing I want to talk about is the point that was raised around forest plan amendments. I think it's really important to study quite closely what the forest plan is. So the forest plan is a strategic management plan document. The National Forest is not a national park. The Forest Service manages it for multiple uses. That's very explicit in the law. Multiple uses, public recreation, but also mineral resource extraction. And so they develop a high level strategic plan for land use. It's a lot like the county plan, the county comprehensive plan, things like that. And then there's sub elements of how they're going to implement that. The forest plan is a management plan for use. It's not an environmental protection standard. They have to evaluate every project for consistency with the plan and consistency with every element of the plan. So the 31 items were amendments to elements of the plan. The project overall had to be demonstrated as consistent with the overall plan. And it gets amended nearly every time a project like this is approved, just like county zoning ordinance are amended, just like county comprehensive plans are amended. It's a similar type of document. So the notion that those amendments have reduced environmental protection standards, that's not what the forest plan is. And the forest plan was deemed at the end of the day There the project was deemed to be consistent with the forest plan with those amendments in place So I think it's important to clarify what it is and what it isn't on the issues around Jaguar and MSO habitat I did want to talk about this is a bit of a timeline I think everybody realizes the NEPA process has been running for about two years but most of the work that went into the NEPA documents been going for about 15 years and So all of the biological baseline wildlife data that was analyzed in the project goes back to 2012. So quarterly analysis, so Jaguar and MSO were raised in the comments. We have the most comprehensive data set in the forest system around that that goes back to 2012. The reason that's important is that data was in hand before we ever designed the project. Not before we built it or tried to permit, but before we ever designed it. So the design was able to take into account, you know, 10 plus years of monitoring data to avoid impacts in how we laid things out. I think that's a very important point. The other thing I want to raise before I get into this timeline, there was a comment about the tailing storage facility. not having been reviewed without resolving some previous legal issues around tailings storage facilities. I think that's in reference to the issues around the Rosemont tailings case, and I think you will find in the record of the EIS there's a mineral report that absolutely directly addresses the legal issues around tailings facilities on federal lands from the Rosemont case. We'll look forward to working through that. But this is the timeline. We had 13, 14 years of wildlife biological monitoring data, 10 years of surface and water quality data, baseline data. So we focus on the two years, but the inputs that went into the analysis go back 10 to 15 years. We started engaging 12 different tribes in 2019, which was five years before we ever started the permitting process. Then the FAST-41 process took hold in 2024 when the Forest Service published the Notice of Intent. So I just wanted to make sure the timeline was clear. It's not the administrative process is two years, but the information gathering, the baseline information, the studies go back the better part of 15 years. We're in the process of taking the 135 mitigation and monitoring measures that we've committed to between the draft and final EIS and lining those up with the input that's come in from the public sessions that have happened with the CPBA. So the town of Patagonia ran a lot of sessions. The county's obviously seeking input. So now we want to line up what's in the EIS with what's been raised from the community about what kind of protections they want in place. The next step in this is the Forest Service is right now scheduled to issue what's called a notice to proceed on September 7th, which is the final step that then allows the activity to go ahead. We'll talk a little bit about workforce training. Obviously getting closer to operations, this is becoming a real priority. I've shared in the past our commitment to 80% local workforce, Santa Cruz County residents. We've been working for a few years with the provisional college and Pima College to implement these programs in nogales we want to train people for the workforce in santa cruz county not in tucson we talked last year about the first cohort starting the electrical certification program in august of last year that cohort will graduate next month We've got 11 students. All of these are Santa Cruz County residents. We're kicking off a new program in August called Automated Industrial Technician Program. Initially 10 students plus, and this is a really important point, we've wanted to get these programs aligned with the CTE programs in the high school. We'll have three students from Rio Rico High School in that program that will be dual enrolled. and going through that program. The size of the cohorts right now is limited by the capacity of the provisional college and the Pima Community College in terms of how many people they can accommodate in one group. Ultimately, we committed we would train more people than what we need. It's important to note that we're paying for all the program design, instruction, and resources, so we're covering all the costs of these programs. The students don't pay tuition. They don't have to come work for us, but obviously we want to get as many of these people into our workforce as we can. In addition to the new program, we will launch a second cohort of electrician certification program in August with another 16 students. So that's 29 more students kicking off programs in August I mentioned last time all local Santa Cruz County residents in the first program we had two employees the rest were local residents that weren't employees in this cohort of 29 we only have one employee and everybody else are just local residents so we will continue to sprinkle in a few local employees into these programs because some of them want to upskill and we want to give them the opportunity to grow their career but the vast majority of everyone in these programs are not in our workforce, but all our local residents and I've talked before about local procurement, and we have someone dedicated in our procurement team working with Santa Cruz County businesses to grow their businesses, to increase opportunities for them to do business with us. And we're appreciative of the partnership with the Nogales Santa Cruz County Chamber. There's been some great work. We've onboarded 30 new vendors this year. That's a 32% increase. So these are Santa Cruz County owned and based businesses. Our spend with Santa Cruz County businesses has gone up over 130% in the last quarter, and now we're sort of over 120 local Santa Cruz County businesses onboarded to be able to do business with us. This one's important. I've talked a lot about 800 to 900 direct employees. But we've said 2,600 direct, indirect, and induced jobs. This is a good example of indirect jobs where a company that's doing business with us hires more people and increases economic activity in the county. Last thing, we launched this project in the last month or so since our previous update. We had a 10-acre block within the town limits of Patagonia that we've owned for a while that was not being utilized. The front five acres of that block, we did a land swap with the town of Patagonia because they want to do an affordable housing project, so they're working through that now. But the five acres in the back abuts Borderlands, Nature Conservancy property, and there's a real opportunity to start a project there that hopefully will expand over time to do some hydrologic restoration and create pollinator habitat. So we've Announced a partnership with the Tucson Bird Alliance that runs the Patton Center in Patagonia to develop this pollinator and restoration garden Tucson Bird Alliance will be responsible for the construction. We're working through that that's commenced and But this will have walking trails, established pollinator habitat. Should be a really nice thing for the community, but a good example on a small scale of things we want to do more of. And as we get into conservation efforts and things in the CPBA and other alliances, this is a good example of what we can do working together. That's all I had. Happy to take any questions. Thank you.

Supervisor Mileta?

Pat, I just want to thank you for the thorough presentation again and the updates on your current projects. And you answered some of the questions I had. They were some of the questions our folks had. So I don't have any questions. Thank you, sir.

Vice Chair.

Thanks for taking notes and answering those questions. So something that I got out of this meeting, and if I'm correct, for example, Mr. Gardner said that he would be willing to help and work, right? The same as Calvacis Alliance, if they need help, you also offer your help. If anybody wants to contact you, have meetings and stuff like that, I think that's good. I think we're going to keep having these meetings every quarter, but I think it's also like the more conversation that could take place, like it doesn't have to be like during every quarter. I mean, so I want to thank you and also the committee members that are willing to work together, have these conversations. I really encourage that. I think it's a good sign. So just saying that, right? Another question that I encourage for those who happen. So I just had a question when it comes to the CTE program. So basically, I mean, it is because I don't know. So when people when students finish that program, they can apply for the end. They have to be like CTE students do an enrollment. They can apply for the automated program.

They're actually going to go through the program.

But they have to have that back down?

It's not a prerequirement. They'll actually be in the same program as the rest of the cohort. They'll come out of it with the same certification that the post-secondary students will have. They're just doing it as dual enrollment while they're still in school. Yeah. Okay. Yeah.

And the last question is that you mentioned that there were going to be some direct jobs, some indirect jobs, right?

Yeah.

So what's the impact that you're seeing in Nogales? Like I know it went up 33%, you say, right? But you're working with the chamber. Who else are you working with? Like who else is

So the partnership with the Chamber is really to provide local, so a lot of the small businesses might not be set up appropriately to be able to do business with a large company, as an example, and so they may not have the systems and documentation and processes in place to do that. So the Chamber is helping us with readiness, so there's a vendor readiness program where they work with them to get set up properly. And then also to connect us, so to find businesses that could be doing business with us that we don't know about. And so that's the primary role of the Chamber. But we have a person on our procurement staff dedicated solely to that program. That's all she does. She meets with businesses down here. There's an example of, you know, a glass business locally here that's doing business with us now that was struggling to kind of get set up properly to be able to do it. And so she and the Chamber worked with them to get that done. mainly what's been going on, as well as getting the word out that there are opportunities here. Because there are some areas where there's an opportunity for local business, but there isn't one, and we want to support that as well. We're about to redo the economic impact study. So we had one that Ernst & Young did a couple of years ago that talked about indirect jobs. We're going to redo that study. Probably the biggest source of indirect jobs that I've shared in the past. The companies that are supplying all of our underground mining equipment, as well as the companies supplying our major components in the process plant, We're requiring them in our contracts to buy their equipment, that they set up their service facilities in Santa Cruz County, that they have local employment targets and goals and local apprenticeship programs. So those kinds of things will be the biggest source of indirect jobs. But obviously, as those local procurement numbers grow, then that also creates jobs.

Thank you.

No questions. I just want to first of all believe, I truly believe that the discussions that took place in January and February, I think they were incredibly informative. I think they were needed. Secondly, I want to encourage the community to continue to ask questions and and if you do have concerns please make sure that you bring them to these meetings and and allow um mr reisner pat to uh to uh shed some light on some of the concerns that that you may have so i want to say thank you to the community i want to say thank you to pat and your team for quarterly giving us this input in this information And also, I want to thank everyone who's taking part in the CPBA. I truly believe that it's a worthwhile venture between the town, the city, the county, and SAL 32. So thanks to everyone, and I think it's important that we continue this dialogue. So thank you. Mr.

Chair, Pat, I have one item. I had someone call me and basically say that they were just a little frustrated with the whole RFP process. specifically I think put in a bid for the container ship and they were just more than anything complaining about the lack of communication feedback exactly okay feedback the back and forth is there a person they need contact

Yeah, I can get I can get you a contact name offline And I'll follow if you can give us the name and I can give you a contact. We'll follow up. Yeah, perfect Yeah, thank you.

Thank you, sir Thanks, sir Sure, so because it came up so and you said it like last year when when the antimony situation happened and there was some communications between South 32 and adq has those channels of communication being like, I don't know, like coordinated so they can communicate if something happens?

Yeah, so following, as I shared in my update in January last year, the notification requirements in our permit were not clear. We did exactly what was in our permit and I committed at the time we would work with ADEQ that if that was not the appropriate course of action, if anything happened, that we would clarify that. So those discussions, you know, we're going to have to amend these permits over time as we continue to operate, so we've initiated those discussions about what would be more clear in the permit to make those requirements not subject to debate, which is what happened last time. Because there were different views on what was required and what did and didn't happen. But, you know, there haven't been any exceedances since then, so we haven't got to that point of needing to do that, but that we absolutely have initiated discussions with them on what would make that more clear in the permit. It needs to be, if there's an expectation, it needs to be written in the permit, and there'll be an opportunity to amend that.

Thank you. Thank you, sir.

Thanks.

OK, at this time, we'll move to item H, action items. Number one, discussion possible action to adopt the fiscal year 2026-27 tentative budget. Mr. Chavez and team.

Good morning, Mr. Chair, members of the board, members of the public. I want to start by thanking the budget process starts in February when we receive the assessed values for all the properties within Santa Cruz County. And that's really the initial beginning of our process to work on the new budget year. So it starts from February. We hold meetings with department heads and elected officials. We roll out that portion of the budget. We hold out a whole week so we can go over that whole process. And there's multiple steps that we have to follow based on assessing revenues, assessing expenses and trends so we can establish a good, comfortable, conservative budget that I can come and present to you today. That's what I have here today. I would like to thank all the department heads and elected officials, of course, for being part in the support of the county manager, Mr. Valdez, and also our human resources director, Mr. Romero, and our assistant finance director, Ms. Martinez, along with the board. Thank you for the support. and getting all the numbers together and putting the package together to present to you today. So it's my pleasure to present the proposed fiscal year 26-27 tenant budget for Santa Cruz County. So this budget reflects our continued commitment to responsible financial management while ensuring the delivery of essential public services that our residents rely on every day. During today's presentation, I will provide an overview of the county's financial plan. Discuss our major revenue sources and expenditures review the general fund and highlight the key initiatives and recommendations, including in this 2627 tentative budget. This slide provides an overview of the county's proposed budget that highlights the priorities that guided its development. So the proposed budget overall is 155 million a little bit almost 156 million dollars. That supports 417 full time employees. Out of those 417, 239 are funded from the general fund. And 178 positions are supported by other funds including grant funded programs. Our budget continues to emphasize conservative budgeting practices while maintaining essential county services. A major priority this year is continuing the property tax reduction plan. reflecting the board's commitment to reducing the tax burden of our residents while maintaining fiscal stability. Overall, this budget reflects responsible financial stewardship by balancing essential public services, investing in employees and infrastructure, reducing the primary property tax rate, and maintaining the county's long-term financial stability. This slide provides an overview of the general fund and it highlights the major areas where the resources are allocated. So the proposed general fund totals 47,181,359. These resources support 26 county departments. such as elected officials elected offices providing the core services residents rely on every day public safety continues to be one of the county's highest priorities combined public safety functions account for 13 million representing about 29 pardon me 28 of the general fund budget so overall the general fund reflects the county's commitment providing essential services, maintaining public safety, supporting county operations, and responsibly managing taxpayer resources to meet the needs of our residents. And you can see on the right-hand side, those are the top departments by percentage-wise. Out of the 26 general fund departments, the Board of Supervisors is at 21%. And my next slide is going to highlight how that derives to 21%. Then second is the sheriff's office, public fiduciary. Public fiduciary is mostly the all tech and access payments that we are mandated by the state to provide. And then finance, grounds, and maintenance, and the superior court. This is a large pie graph. It has a lot of information in here. So you see a lot of different breakdown of the general fund and where we stand. Now, we go back to the board of supervisors there with the 21%, the sheriff, but it also highlights all the other multiple departments that constituents receive services on a day to day basis there. This slide provides an overview of the Board of Supervisors budget and highlights the major expenditures and funding commitments administered through this budget. The largest budget categories show on the slide represent about $7.1 million or about 71% of the total budget of the Board of Supervisors. A significant component of this board budget is the operating Transfer out so you see that highlighted amount. The blue line on top of the 1.7M that's in the board's budget. That's what makes it very large. Initially, you can see the operating transfer out that supports animal control. It supports our environmental health services general fund. It supports our bond service, our 1904 historic courthouse maintenance, and then provides funding for the fair and rodeo association. That's where you see the large portion of it. Then legal services, you see our normal legal services and then indigent defense. We are required to provide indigent defense and through the courts. But the board holds that budget in the board's category. So that's, again, another reason why the board's budget is higher than normal due to the indigent defense being budgeted through the board's budget. And then we have employees' salaries there, other professional services that are utilized, and then our City of Nogales library contribution also taps into that amount. So that gives you an overview of the reason why that budget seems a little higher than other departments. I'll stop there so I can entertain any questions on the previous slides and particularly this one as well.

I just really like the pie breakdown. Seriously, I like the way it really breaks down all the departments.

We do, it's amazing how there's multiple, I mean there's 20, I keep forgetting, I'll go back to this one, there's 26 different departments that the general fund takes care of. and functions all the way again from public safety to public fiduciary to the recorders, the treasurer's office, the assessor's office, county attorney's office, superior court. So there's a lot of functions of all the services that we provide through the general fund and that probably gives you a good perspective of where the money is going.

And that 21% that the board represents, like you said earlier, we fund other programs through there.

Correct. That's a great question. So that's part of it. I know it seems a high enough percentage, but there's a lot of different line items embedded in there. First and foremost, that's where the board pays the animal control department to function, the health department to function, and that's where we pay our bond debt service payments as well. Then legal services, all the indigent defense where we are required to pay through the superior court. Basically, when folks are in a situation where they need an attorney and cannot afford one, that's where this budget comes in and we take care of those payments on their behalf through the board's budget.

Thank you, sir. All right, Mr. Travis. I would like to see, I don't know if it's possible, but like actually like this pie, but another part and actually like break that piece. Like you said, all those things, because I mean, if somebody sees this graph, they're going to see this big amount. But maybe like underneath it, like if this part just break it into the little sections.

Absolutely. That's something that we can produce. And I know that that's the pie. This, you want to see this information basically in the pie.

If you miss one, you're not getting the whole picture. Sure. Happy to do it.

Thank you. I'm going to save my comments to the end. Thank you.

Okay. I'll move on to the next one. So how are your property taxes distributed? So a common misconception is that all property taxes go to the county. In reality, the property tax bill is shared among several independent taxing entities that each provide essential public services. These include our local public school districts that help fund classrooms, teachers, and educational programs. Property taxes also fund local fire districts which provide fire protection, emergency medical response, and public safety services. A portion also supports the provisional community college district and the joint technical educational district. They help prepare students and adults with workforce training and career opportunities. So Santa Cruz County, ourselves here, and the property tax bill, we help fund essential services such as public safety, law enforcement, the courts, the justice system, public health, roads, flood control, and other infrastructure. It's important to remember that each taxing entity independently sets their own tax rate and budget. The county only has authority over the Santa Cruz County portion of the property tax bill. The key takeaways here is that the property tax investment supports broad network of local services that work together to keep Santa Cruz County safe, healthy, and a vibrant community. I guess this paints a good picture when taxpayers receive their property tax bill, there's a lot of line items. This shows all those line items. The payment that's made to the treasurer's office, there's a lot of percentages division. And outside, we have different posters that outline that, that give it a better perspective. We have some dollar bills that are broken down. By areas by 6 areas, 6 common areas. Now, there's more areas, of course, in our county, but those are the 6 most common areas. And that provides a good visual about what every dollar that we, as taxpayers pay. where does it go so yes in reference you do make the payment to the Santa Cruz county treasurer but it is his responsibility by statute to distribute those funds to the appropriate taxing districts and that can be the school districts where you reside the fire districts where you decide in provisional college and of course the county itself but it gives you a good a good overview of that This slide represents the commitment that the board Has made regarding a reduction of tax. A property tax reduction plan that began last year. So, last year, your, your, your vision was to reduce it for the next 4 years. We're in the 2nd year. And if you see the circle there for 27, we are at 3.9765 for the current year. What you know we're proposing in this tentative budget is a continue their reduction that you requested at 3 cents for 3.9465. So if we if this this highlights schedule B, so if you look at your. At your budget book, this information is taken from. From schedule B gives it puts the tax rate as the recommended at 3.9465 and that would generate generate about 18867000 dollars of property tax revenue. Okay. So this would be about 3Million dollars below. the maximum allowable levy. So U.S. Board have the authority to levy up to $21,946,956. That rate would equate to 4.5907 as you can see on that graph. However, your commitment was to lower that rate and be mindful of the constituents, be mindful of the spending and have a conservative budget. So this budget includes the 3.9465 for an $18.8 million tax levy amount. So that was the primary tax rate. In the secondary tax rate, that goes twofold. So once you reduce the primary tax rate, the secondary gets reduced as well. So we are at current at 0.7953 cents for the secondary tax rate, which is the flood control district. With the proposed rate in this budget, it's 0.7893. So same percentage reduction as compared to the primary.

Can I ask you a quick question? Sure. Do valuations continue to go up on the assessments, right? They do. I think we may down the road need to look at that because while we are dropping it three cents, people are still getting an increase in their property value. So maybe we can take a good look at that down the road. And we can do that, absolutely.

And I would invite our assessor, Paulo Ramos, to be here because that very question I had based on constituents' concerns. And when I met with him for about a half an hour, 45 minutes with County Manager Jesus Valdez, there's from what I learned there's very little wiggle room you know based on the statute based on the voter approved statute so I think it would be it would behoove us to to have mr. Ramos here to explain that a little bit more in depth because it is a very in-depth discussion absolutely maybe for a future study session yeah

Happy to do it. Absolutely. And to those points, we go to this slide. Now this slide is going to, even though the primary tax rate is being reduced by three cents, there will be some property owners will see an increase in their average tax impact due to an increase in assessed value. Now this is that proposition, right, that was voted by the voters and passed, you know, in the state voters that gave the cap of that 5%, that no more than 5% of an increase. In a good economy, you're going to have an increase in property values. That's going to be a given. That's what we want. We want our economy to grow. We want our property values to grow. That's our biggest asset when we have as a property owner. I know that would be my biggest asset. So we look forward to that being growing at a decent rate. And that is what you see before you. With that, even though the primary tax rate is going to be reduced and also the secondary tax rate, there is going to be an impact because of the increase in assessed values. So on an average home of $100,000, you'll see a total impact of about $5.41. a year okay this is not uh on a monthly basis so this is a year so approximately about 45 cents per month is going to be the increase okay this is a very powerful slide mr chair if i could add just add up to my seals

when you start looking at the property rates just the rates itself for county operations we're number three as the highest Partly or greatly caused because we don't have Commercial property like some other their counties number number one if if I may say it's a Is as Gila Gila has a little bit of hired it's a little bit over for and then Pima County and in us so the hope is you know as You know if everything we the discussions we have and we expect that industry is going to come into our County the hope is as to lower that rate just just some background information

This slide is taken off on the budget book and the tenant budget out of Schedule C. This is the county's general fund and how it's supported by maybe different funding streams. So property taxes account for about 49% of all general fund revenues. making that the county's largest revenue source. This revenue is critical to support public safety, courts, administration, and other core county services. State shared revenue sales tax is our second largest at 19.7%. Local county sales tax contributes 11.7 and then for the general fund. Overall, the general fund revenue structure reflects a balanced mix of local taxes, state share revenues, federal support and service related revenues. This diversified funding base provides financial resources necessary to sustain our county services while supporting long term fiscal stability. Any questions, members of the board, so far for this? This slide provides a little bit more detail. It removes the property tax equation from the general fund and provides more detail on where the percentage breakdown removing the property tax. So still our second highest, but in this pie chart, our highest revenue is going to be state shared revenue sales tax. Our local county sales tax, and then our vehicle sales tax, that's the license renewals that we have to do every year for our vehicles. Then we have our building permits, charges for services from each department, city, state, federal reimbursement, IGAs we have with maybe the city of Nogales, the town of Patagonia. Our pelt, which is our federal payment in lieu of taxes for all the forest land, US forest land that they don't pay taxes. This is in exchange of that. And that's the amount and then our county assistance fund, which is normally known as our lottery funds. And then the interest on the investments that we read every board meeting and then it rounds up with fines and forfeitures. So all those estimated revenues extracting the property tax revenue is close to $20 million. So we go back to the original slide where I showed the Board of Supervisors and they have the operating transfer out. That transfer out was that $1.7 million that you see up there. That was paying the health fund, that pays the animal control, that pays that service. These other are responsibilities that also the general fund has to transfer out to other departments. And the two largest ones, the biggest pies that you see there, is for the jail district. So the jail district is divided in two pieces. It's the adult detention and the juvenile detention. And it's broken up between 70% and 30%. So every year the general fund has to support under statute the jail district to the tune of an amount that changes and it's based on the assessed values and it's based on The gross domestic product and it's based on different values that we have to calculate in this year. It's close to that $5 million amount there. So 3.4 million is directed from the general fund to the jail district adult and then 1.5 million is directed from the general fund to the juvenile. So that's those are required under statute that we have to make. So those are payments. Then the other smaller transfers that you see there are for grant matches. Typically, for example, the county attorney's office, there's some grants that don't cover. The expenses at 100% that might be certain employee related expenses. It might be some other issues that the general fund has to cover. and the same for the airport we had that's a small amount this year because we a lot of the projects that uh we had with the airport have been completed but most of the grants for the airport have a match and typically that one that one's a small one it's typically about two to five percent that's why you see that that small amount there And then our Parks and Recreation grant match this year that we're gonna be matching the CDBG that's in the agenda actually today as well. Any questions on Schedule D? This slide will provide you an overview of all the expenditures that we have, and they're divided there between the total county budget, which is 155.8 million, which that includes all the funds. The general fund, special revenue funds, our capital projects, Our enterprise fund, which for us, our enterprise is the landfill, and then our debt service funds. And then on the left, you'll see there the 47.2 million, which is, that takes care of our general fund. And we went over that, all the 26 departments that that covers. And that gives you an overview of the overall picture for this tentative budget. Any questions on Schedule E for the general fund? To point to Mr. Valdez's comment earlier today about working with over reviewing our operations with animal control. And this all started with the potential closure of the animal shelter. With this information, the board has made a commitment that we'll continue to invest additional resources to support and enhance the animal control operations. We're planning for the future, so the board is also actively considering an alternate or an additional location for animal control services. We know that we heard really good news about the additional donation in funding for the Humane Society shelter, however, that's only going to extend it a certain amount of months. But the board, this budget includes an active and proactive approach into providing additional funds for animal care and control. And there's also going to be a collaboration, as Mr. Valdez indicated, with Pima County officials and Pima County Animal Care and Control to evaluate any type of proven operational models they have, best practices, so we can apply here on our own program. This this slide provides a schedule G in your in the budget. No, this is a compensation breakdown. And it provides information on how many employees total employees the county is supporting. We have 417 full time. Positions out of that. Overall, it's a $38.1 million investment that the county is making towards that. And the breakdown that you see on the right is where that's going, with $25 million going into salaries, and then almost $6 million going into healthcare, almost $4.6 million into retirement, and then $2.6 into the other employee-related expenses like FICA and Medicare and all that. The general fund has 239 employees, which is about 60% of the compensation, while the other grant funded or other special revenue funds are at the 40%. This slide provides what our most valuable asset is in maintaining a competitive workforce essential to provide the quality services that Santa Cruz County residents deserve. The proposed 2026 and 2027 budget includes a 3% cost of living adjustment. to help the county remain competitive in attracting and retaining qualified employees. This recommendation is supported by economic indicators. For example, the 2026 Social Security COLA for this year is at 2.8%. Early forecasts, however, for the 2027 Social Security COLA range anywhere from 3.8% to 4.7%. So the consumer price index increased to 4.2% reflecting our continued inflammatory pressures. And then our healthcare insurance costs are increasing this year by 8.7%. That's a normal trend. And an average, even though I know that I did receive a call from the folks from the city of Nogales because they just wanted to verify what increase we had experienced on our healthcare, because apparently their healthcare went up 25%. So fortunately, we're in a better situation. Our insurance pool is working. We don't see that increase. We see an increase every year. However, this increase is still substantial, but it's not to that point. This is an overall additional cost to the general fund of $278,000. and the recommendation that we're making as staff and it's embedded in this budget is that we absorb that the county absorbs this portion at a hundred percent now we do have the bylaws and i just want to point out the bylaws in our insurance pool is that the county must pay at least 90% of the healthcare cost of an employee. Right now, we're at about a 91% to 9% ratio. And the recommendation is to keep it that way for the county to keep absorbing that. Any questions on this slide? No, sir. This 2026 levy limit worksheet is provided by the Arizona Department of Revenue, the state of Arizona. That gives you a breakdown of the maximum allowable levy limit you as a board are allowed to levy in both amount and tax rate. So we went over this on the slide that went over schedule B. But I want to emphasize that you're allowed to levy $21,946,000 and the tax rate $4.59. However, that's not what's embedded in this budget. In this budget, we're doing the $3.94. Okay. That concludes my presentation of the 2026-2027 tentative budget. I'm open to any questions or discussion the board might have.

Supervisor?

now uh mr charles i just want to thank you and your staff and miss martinez and all your staff because i know how hard you work on on these budgets and and how hard you've been working the last couple weeks i personally appreciate all the hard work you put into this thank you

Vice chair the same thank you for all your work I know that you sometimes come Saturdays right in the weekends and that's true it does and also for the posters outside they're really really good I think you're becoming very good at graphic design so thank you Mr. Chairman members maybe I have a future right there in graphic design yeah A former graphic design teacher.

I, too, want to say thank you. I know that the work is arduous. And I know you work eight days a week. That's a joke, by the way. I know there's only seven. But that's just a testament to your hard work and your team's hard work. and I know it goes on for most of the year, so you are appreciated. I also want to mention what Vice Chair Davis mentioned about, I call them placards, posters, whatever you want to call them. I want to make sure that we continue to have those available to our constituents so that when they do come in and they have questions, that might ease some of their, I don't want to say concerns, but it might ease some of their concerns or it might answer some of the questions that they may have regarding the funding and where the money is going to. I think this was a very thorough presentation, and I thank you.

Mr. Chairman, members of the board, thank you for the support as well. We're here to assist the public with any questions they have. We'll be here after the meeting and to take any concerns or questions out there by where the posters are at. I hope the posters are helpful. I know that any type of accounting, and especially government accounting, is very, very complex.

um but we're happy here to be and answer any questions that anybody might have thank you sir and i want to say just just a quick comment that maybe not a lot of people know but i i do know that like with mr chavez mr valdez and and a lot of people at the county even shannon like whenever i get a question like i mean it could be like it could be really early it could be in the weekend I call, right? And you guys always answer. So that's, I mean, if I think that I work hard, I always think of you guys. So, so thanks for that. You know, that's true. Thank you.

At this time, I'll entertain a motion to adopt the fiscal year 26, 27, uh, tentative budget. They move the second. It's been moved in seconds. Any further discussion? Hearing none, all those in favor, please signify by saying aye. Aye. Motion carries unanimously. H2, discussion possible action to award bid number B-05-26-C079 for fiscal year 2627, legal publications and advertising following the opening of properly submitted sealed bids pursuant to to ARS 39-201, 39-202, and 39-221.

Good afternoon, Chairman and members of the board and members of the public. We have received one sealed bid, and it is from Nogales International, and I'll go ahead and open it up.

I thought we weren't doing publications anymore. Just kidding.

Mr. Chairman, members of the board, it's in statute that we have to do publication to inform the public. Understood.

This proposal reflects a 0% increase. It remains at $6.62 per column inch, plus the standard 10% processing fee for a total of $7.29 per column inch. This represents a discount of 8% from our open rate of $8 per column inch.

Based on the information provided by Ms. Alma Schultz, at this point, I will entertain a motion to approve.

Move to approve.

Second. It's been moved and seconded. Any further discussion? Hearing none, all those in favor, please signify by saying aye. Aye. Motion passes unanimously. At this point in time, we're going to move to item I, consent agenda. Do I have a motion to approve? We're going to skip each three until after the executive session.

Move to approve item I, consent agenda. Second.

There's been a motion and a second. Any further discussion? Hearing none. All those in favor, please signify by saying aye.

Aye.

Motion carries unanimously. At this point in time, I'd like to entertain a motion to recess regular session and move into executive session F pursuant to ARS 38-431.03, A, 3 and 4, discussion and consultation for legal advice and or direction regarding the potential retention of outside counsel for current or former employees and any spouses named as defendants in Auditor General versus Acuna. at Al Maricopa County Superior Court case number CV 206 202 6-0 1 4 2 7 0 entertain a motion and move second it's been moved and seconded any further discussion hearing none all those in favor please signify by saying aye aye motion carries unanimously we will now move into executive session

We expect.

It's right here. We received it April 15.

April 15 of 2025. How many days did you have as a supervisor? So you started 2025. So that means.

Let me know when you're ready, Alma. OK, welcome back. At this point in time, I'd like to entertain a motion to reconvene regular session. So move.

Second.

Any further discussion? Hearing none, all those in favor, please signify by saying aye. Aye. Aye. Aye. Motion carries unanimously. At this time, we'll move to action item H. Discussion possible action to approve the possible retention of outside counsel for current or former employees and any spouses named as defendants in Auditor General versus Acuna et al. Maricopa County Superior Court case number CV2026-014270.

Mr. Chair, move to approve the possible retention of outside counsel based on county attorney recommendation for current or former employees and any spouses named as defendants in the Auditor General versus Acuna, if at all. AL, Maricopa County Superior Court case number CV2026-014270.

We have a motion, do we have a second? Second. Okay, any further discussion?

And Mr. May. Thank you, Mr. Supervisor. The employees, as an explanation, in the county attorney's office in discussion with other outside counsel and our other litigation have discussed this extensively. The employees are sued under their official capacity. even though they were cleared by the FBI and the Department of Justice of any wrongdoing with the Liz Gutphahr embezzlement. There's a pattern of the Auditor General filing frivolous litigation. This is one more example of that. The risks to the county could be implied and inferred, especially if you read the complaint, the first amended complaint that they had more recently filed. That is a greater concern. The county attorney's office in particular is most concerned about the implications to the county. And when the employees are sued under their official capacity, any findings in that particular case could be inferred or implied and passed on to the county. And then if there's no action, leads to an increased risk to the county of ongoing litigation Greater cost to the county of trying to undo bad litigation So this is why we are recommending that outside counsel be authorized as we have recommended and as we choose as we are recommending of a firm to represent these counties as much to protect the county's interests and avoid bad outcomes that the county would later have to defend against and expend against.

Mr. May, just moving along with this conversation, I remember when I first became a supervisor at a very early stage, being in my office and getting served, right? I remember getting served. Mr. Fanny got served, like some of the wives and stuff. And then what happened, it got dismissed, right? Nothing happened. It was very, I think it was a lot of people knew about it. And then like another one, I remember like, And I think it's important to clarify this. It came out in a lot of news that the previous board broke the open meeting law, right? And that came up. What happened with that situation? Would that be like an example of what we're talking about?

Sure. And Supervisor Davis, you raised some good points. The first one is that you and Mr. Fanning were brought in as defendants and spouses of Mr. Chavez and Mr. Valdez. for, again, very frivolous complaint. And that was a cross-complaint in the original action that the county had filed against the Auditor General. That was found to be frivolous. That was found to be more so unsupported. And especially dragging you two into that was completely ridiculous. Well, that particular cross-complaint was dismissed. Well, this new complaint is now another attempt by the Auditor General to avoid their own responsibility and to file even more frivolous types of litigation. again, the greater risk is to the county of something that the county's not even named as a party in this particular new litigation. So, again, the main focus here is protecting the county's interests the other part of your question is that the county has through our outside county or outside council of snell and wilmer has about a month ago refiled the original complaint yes the auditor general got lucky on one weird technicality an open vote supporting or engaging in litigation. Well, that case is basically reaching its own conclusion, but the county has refiled the exact same complaint consistent with what the Arizona Supreme Court found is that there's no time bars for government to file litigation. And so the exact same complaint has been refiled as well as a motion to consolidate or bring in all of that other litigation that was done, all the cross motions, all the motions dismissed, et cetera, that was done in the 2024 action that's been litigated for the past year and a half out of the concept of judicial efficiency. There's no reason to restart this all again. That's ridiculous. It's all been argued. And the Auditor General's hope to try to relitigate that and come up with a new decision in their favor is, again, frivolous and a waste of taxpayer monies. This so what the county has done as authorized by the county through an open meeting vote was to refile and then filed the motion to bring in all of those prior findings so that again we can move on from here towards holding the auditor general accountable.

Thanks for explaining that because, like I said, when I got in, I got served, I got dismissed. And I said this in one of the previous meetings. We're a rural community, right? We're a rural community that our funding is different. We're not Maricopa County. So a lot of these complaints, they were dismissed eventually. Yes. I think it's important for the community to know that a lot of these complaints that were in place got dismissed. For example, and the reason that I brought the that the previous board broke the open meeting law was because not long ago somebody asked me like that you they stayed they didn't know that uh the situation had changed um and it was it was never clarified so i mean so it's good to explain right now that a lot of the the complaints We're dismissed and we keep moving forward. I mean, it just, it gets delayed. It does. But they also got dismissed.

They did. Yes. And now we picked up again from where we left off.

And I think something else that people have to know, it's hard because I remember when I got served, I got home and my family was like, you know what happened with my wife? And so, yeah, I think it's not, thanks for clarifying that. And I think it's important for everybody to know the situation. You're welcome. Yes.

Thank you, sir.

Thank you.

I understand the public's concern, you know, call to the public today. There was some concern related to this action item. And I understand that. And that was definitely taken under advisement and consideration. But based on what was discussed in executive session, based on the implication to the county, if we do not move forward in this direction, I agree that no action equals greater risk to the county. So, and thank you for clarifying that during executive session. With that, um, we'll move forward with, unless you have anything else, move forward. Okay. Call for the vote has been mentioned. Um, with that, all those in favor of action item, uh, H3, um, the motion was made by, uh, supervisor Mileta, seconded by vice chair Davis. All those in favor, please signify by saying aye. Aye. Motion carries unanimously to adjourn the motion to adjourn. Do I have a second? second okay any further discussion all those in favor please signify by saying aye aye motion carries unanimously we are now adjourned