Finance & Debt Oversight Committee - Regular Meeting

Good afternoon. The regular meeting of the Finance, Debt, and Budget Oversight Committee will come to order, and the clerk will call the roll.

Sorrento?

Here.

Driscoll? Gattis? Here. Hobbs? Jones? Here. Martinez? Three present.

Thank you. All right, good afternoon, Director. And we will start off with the delinquent collection report from DPU. Good to have both of you here, Commissioner.

Great. Thank you. Good afternoon to all of you. My name is Batika Pope-Bannister, and I'm the Director of the Department of Public Utilities. And I'm here with Cindy Geronimo, who is the Commissioner of Utilities Administration. The installment payment plan program continues to generate significant collections. In June, we reported $3.8 million collected year-to-date, and in July, we are reporting $5.2 million collected year-to-date for residential and commercial. The utility's total active delinquent balance remains substantial at approximately $39,263 million, which is a reduction, with residential accounts comprising the majority of outstanding debt. July recorded 386 service disconnections and 149 reconnections, reflecting ongoing collections and customer repayment efforts. For our reconnected customers, which is about 149 for the month of July, after meeting the requirements for service restoration, such as making payment, entering a payment arrangement, or otherwise resolving the account issue, customers that requested a payment plan are required to make a payment or get on installment plans. The majority of installment plan activity and delinquent balances are concentrated amongst residential customers. While collections through installment plans are significant, a large delinquent balance remains outstanding. Disconnections and reconnections are also predominantly among residential accounts, highlighting ongoing challenges in payment compliance and service continuity. Our various payment plan programs remain an important tool for reducing outstanding balances and helping customers avoid or recover from service interruptions. For our residential customers in July, we had 1,016 new plans. So year-to-date, we have 4,148 plans. In July, we collected $1,568,510. And that gives us year-to-date amount collected, $5,118. $43. Total schedule to be paid is $11,521,903. For our commercial customers, we had seven new enrollment plans, which gives us year-to-date 31 plans. In July, we collected 53,233. And active plans through July is 99. Our year-to-date total is $221,448, with $325,382 scheduled to be paid. As I mentioned, our totals were disconnection. Residential disconnections were 382. Our commercial were four. we were able to reconnect 148 residential and one commercial. So you'll see on the spreadsheet here, total active delinquent amounts for residential is 33,889,737. Commercial is a little over four million. Industrial is a little over four million. One million three hundred and sixty thousand which gives us a grand total of thirty nine thousand thirty nine million two hundred and sixty three and eighty And that would become totally owed.

Yes to DPU. Okay, so it looks like from I have last month's report that we've collected about a million dollars and in Last month, we had year-to-date enrollment of residential 6,502 customers were enrolled for residential. But then this month, we're reporting 4,148 enrolled. So that's a drop or-

Yes, as people finish up their previous...

They finish paying.

Enrollments, yep. Or if they, some we took off of a payment plan that they were on And we were able to get them into other plans that we have, our fresh start program. Fresh start.

OK. All right. And do you sense that the collection efforts, the actual dollars collected are going to drop off? Or do you think that it will continue to grow?

We think we will, in August, or for the next report, you will see that we continue to grow and we do have a number of outreach events and some targeted customers that we need to reach out to. I think we have 13,000 that are eligible to be on payment plans that we'd like to reach out to those folks and get them on it.

Are we sending notices on the bill itself that, you know, past due billing that they have the opportunity to get into a payment plan?

So yes, there were 18,000 originally identified that were eligible for the program that we are targeting with constant messaging, both through Promise through our comms office, so we're also, there's a notice on the bill, and we're having outreach sessions. We did, as of last Friday, we had 3,800 customers signed up and 1.6 million collected. last Friday so it has it is popular we are continuing to outreach we just looked at the 13,000 that are still eligible that haven't participated yet we divided it into council districts so that we can do some outreach with the council numbers and let them know and we can do targeted outreach and messaging as we wind up the program at the end of September okay that's good council person Gattis

thank you um yeah you guys have been wonderful as i said before the meeting i wanted on record that you guys have been at block parties and different events hosting events throughout my committee or my district and i even personally sent out a letter to about 2 000 people in our district just to let them know hey it's out here hey we've got this program um I think we need to buy a letter folder, though, because I folded a lot of letters. Chair. But I wanted to ask about Promise Pay. I had a resident customer call yesterday. They were one month late, or a couple days late of their bill, and they got a Promise Pay text sent to them. Do we just send that automatically the day someone is late on a payment? do you wait a little bit of time? Like, how does that work?

So they were late on the bill, and then... Yes, two days late. Once they become delinquent, they start getting messaging from Promise saying that they're eligible for a new plan. Okay, so it starts right away. Yep. Okay, okay. And the Fresh Start program right now, too. They'll message that if they're eligible.

The commercial, you had four disconnects and one reconnect. The three that are still currently disconnected, do we check to see if they're on the vacancy list for UPS or with housing?

So our legal and collection team has access to Ptolemy, so they've been utilizing that tool too.

Oh, great. Okay. And the same with residential?

Yes.

Okay. Okay. Awesome. Awesome. Well, you guys are doing great. I appreciate all your hard work. Thank you, Chair.

Thank you, Councilperson. So, in talking about the commercial customers, the ones that are not signing up, do we know that, are they, is it a thriving business? They're still in business? Or is it a business that's closed? Do we happen to know?

Like I said, the legal and collections teams, they do a lot of investigation on the accounts to see if they can get them into installment plans. So there is staff calling and reaching out to these commercial accounts to let them know that they can offer installment plans for them.

Do we have any industrial customers that are delinquent still?

Um, industrial commercial, if there is, it's more like we're investigating something with their meter or, you know, investigating like the. There's something on the bill that's been identified that we need to look into.

All right. Okay. Well, I mean, we're making progress and it's encouraging that you said 1.6.

1.6 has been collected through that program. And I will say another benefit too, like in East Toledo, we had a senior that came in and she owed like $3,000 and we saw that her bill was consistently like $250. It's one person living at her house, and it was because she had a leaky toilet and a leaky faucet. So we were able to connect her with a resource, take care of that, and so it is bringing out these type of issues too. So the outreach events have been good in identifying those additional issues.

Yeah, and I had a constituent a couple months ago, same situation. One person in the house, but there was a leaky toilet in the basement, and they didn't realize that, and then they went down after they got the bill to check, and sure enough, it was leaking, and it was costly. It was several hundred dollars that they owed, so that is important. um director could you also uh mention to the committee what the department is doing with regard to people that want to get a second meter in terms of irrigation systems how that is going and i think we're putting it notices are being put out on that yes so um for this year we um

We have put a plan together for irrigation meters. People have an ability to contact water distribution. There is a process where you have to get a plumber. There's an inspection process. but we are reducing some of our costs for the inspections at about $250 we have a list of people that have called within the last a year or so and we're working our way through that list to notify people that this is a program that we have and we've also been working on putting things on the website with a because we're winding down for the year you know we're at the end of august so the plan is for next spring to

advertise a little more and make sure that people are aware and part of that is Getting a second meter for free that wouldn't cost them. So that would save them some money. I I reported to you and the deputy mayor that and the mayor That there was a resident that contacted me last week and they had put in that second meter and paid for a plumber a couple months, well three months ago. And they feel that within two years they'll have the money paid back that they spent. It was about $1,200. And they have an automatic sprinkler system and I believe they have a pool. in that case it was a two-year payback so um i think you know i know we've talked about a four-year payback but some people may enjoy that even quicker so i just wanted to mention that yeah yep and that's dependent on the amount of water usage right right okay okay uh dr joe

Thank you chair. Um, I wanted to echo just basically the good work that you've been doing, especially trying to get all this together and cleaning up and things of that nature. I was just curious as far as do you have the numbers as far as the average cost or the average bill for residential customers and commercial customers? Like how much, what is the average pay that they're usually having for their bill? Or is that by way of referral?

Yeah, we take it, by the way, a referral. But typically for a residential, it's like $75 a month.

I was just trying to see what is the nature of these bills for this to be building up and just trying to get a picture. And commercial, do you have that probably on top of your head?

We can definitely give you an average of what that would be typically for just a regular commercial account.

Okay, okay. And for the total schedule to be paid, so what basically is that time period scheduled to be paid?

Scheduled to be paid is, that would be, The installment plans are 24 months, so that would be the end of two years.

So basically this is encompassing the entire time. Within that two-year period, yes. Okay.

And they're all on different timelines, but that's.

Okay. And my last question, not in reference to this, but the water tap program, has that started as far as with urban farms and gardens and such? Oh, that has started.

Is that commercial accounts? Or, I'm sorry, community gardens? Yes. Yes, yes. We actually have revised, like we've kind of streamlined that process and we've reached out to all of the current community garden participants and we also are promoting the program more too.

Okay, great. I'll do by referral like more than number. It's just an update of that, but I'm glad to hear that it's taken off. Okay. Thank you, Chair, and thank you all.

Thank you, Councilwoman. Also, I just wanted to bring up, as you'll recall, Councilman Meldon asked for more of an in-depth audit in terms of the delinquencies and so forth. And I wanted to ask the city auditor, you're compiling information on that?

That's right. I'm doing a utility receivables analysis, and I did meet with Manager Kashishke yesterday, so we have info, and he walked me through that, and we had a good meeting there.

Okay. Any idea when we'll have results of that audit? It will take a little bit to go through the details, but hoping to make substantial progress in the coming weeks Yeah, and I think the intent there on behalf of councilman Melvin was to get the demographics where the Delinquencies have occurred and again help us for the future in terms of collection efforts what we can do so in each of the districts Okay. Thank you anything else director No, I appreciate the report director and commissioner and we'll see you again next month sounds good. Okay. Thank you Next we'll have the Department of Finance come forward and Good afternoon, Director Campbell.

Thank you. Good afternoon, Chairman Sorrento, members of the committee. We're happy to be here today to report on our July revenue and expenditures, provide a ARPA update for the committee, and take any questions that you may have. To dive right in, hopefully everyone has a copy of the normal packet in front of them, and I will turn it over to Commissioner Zavisha to provide an update on our income tax revenues.

Okay, thank you.

Good afternoon, everyone.

Good afternoon, Commissioner.

I'll be starting on page two of the report. This covers through July of 26 and comparing it to July of 25. Starting in the withholding category for the month of July, we were up 646,000 or 4.3%. So this is continuing our trend right now of sort of matching what was happening in 2025. the year started slow revenues are a little behind they start to pick up as the summer months are going so we're hoping that this will continue coming forward like it did last year so far this year then so overall the withholding category is up 1.5 million or one and a half percent Unfortunately, for the business net profit category, it is also following its trend. At this point for the month of July, we were actually down 2.1 million in this category or 6.9 million for the year. As mentioned before, this is very isolated. When we look at our top six net profit companies, those six companies are down 6.5 million. So it's a really small group that's 6.5 and then really everyone else in the net profit category. down approximately four hundred thousand dollars for the year we do looking forward on this for the rest of the year this category will are these six companies would normally pay in about an additional 1 million dollars and the majority of that would happen in August so although we are continuing to see that these companies are following their trend It should end up slowing down as the year goes down just because they'll pay in less What we're hoping is four of those companies have yet to file their 2025 taxes On federal extension they have all the way to November 15th of 26 They currently have approximately five million dollars paid in from prior years and we'll have to wait till those returns come in to see if they ask for a refund and they owe that full amount or they're carrying that money forward there is still a third and fourth quarter payment due in 2026 so it is possible that let's say they have two million dollars they owe the city a million dollars they would be due to make two million dollars in estimate payments in 2026 but if you've already got that million dollar carry forward that would have covered your first quarter payment and your second quarter payment which is why those would be zero And then you might make a half a million dollar payment third quarter and fourth quarter. Again, until these returns come in, we'll not be able to necessarily see that. But again, this is definitely the category that is hitting us the hardest so far this year. Again, being down 6.9 million at the end of July. For the individual category, this is a category where we just keep sort of towing that line of the 2025 numbers. One month we're just slightly above 2025 space, the next month we seem to be below it. As you can tell, very even between the two years. We are $5,250 behind where we were at this time in 2025. So, you know, less than .1%. uh overall for the year then we are down 5.4 or 4.3 percent again mostly driven by business net profits on page three of the report.

Could I ask a question? And you and I discussed this earlier, but I want this on the record. So in the W2 category and withholding, it doesn't appear to be a issue with these large companies of layoffs because we're still collecting tax revenue from the employees. So would you agree with that? Yes.

So, yeah, you have that to begin with. Withholding number is still a strong number on that one. Sort of like the example I gave, what sometimes throws people off is just because a company isn't paying money to us doesn't mean they're not profitable. But if they have enough credits from prior years, that's affecting the total. So, like I said, it's possible you could have a company who potentially next year would owe us $2 million. but they're not going to make $2 million in payments if they're using their credit carry forwards from prior years. The other one then we have to watch out for too is definitely if a company happened to have a loss, loss can be carried forward for five years so you can sometimes have a profitable company who two three years ago had a huge loss they could be using up that loss credit as well to make them you know until that's used up do they start owing taxes again so sometimes it does get a little confusing that it just because they're not paying in does not mean they're not profitable right okay well thank you for clarifying that proceed Moving on to page three of the report, we're currently projecting the income tax revenue at 236.1. The other thing I would like to note on that one is refunds issued through July of 26 is 2.4 million. It's about a half a million dollars behind last year's pay. So this is another thing that comes into play, too. Each year at the end of the year, we create a reserve of $6 million for refunds. so the fact that this category is at least moving technically in a positive direction because we've issued less refunds would mean that we would have to take less of our total income to replenish that for the next year um so again that's something else we're sort of watching then too um that you know it isn't just the income side obviously it's the amount of refunds the city's issuing as well okay I'm happy to take any other questions.

You want to just give us a quick update on Stacks?

Sure. For Stacks, through the month of July, they've collected $3.5 million. For the year that puts them down about $153,000, we were projecting about $6 million in this category, which they're still on pace for. this year's been a big move for us we had felt we were putting too many resources towards assessments that weren't became that weren't fruitful and then again we're also working with the Ohio Attorney General so we had to do a lot of modifications to our billing system within that unit so we sort of pivoted on that one doing less for assessing this year and instead prepping us more for the First quarter of 27 the Ohio Attorney General can take someone's federal or state refunds if they owe city taxes And it's a matter of getting that information to them prior to tax season So that we would have a chance to get collections on that.

Okay I'm just curious if you've had Conversations with other tax commissioners around the state other urban areas if they are experiencing the same thing we are in business tax and

For this one, we're not, because this is, we're definitely very heavy in the auto industry. Right. And you just don't have that with the other major cities in Ohio. Because again, this is something sort of very isolated to some particular companies that in a couple of cases just aren't in those other areas at all. Okay. Because again, when you take the rest of the business net profits, Yes, we're down about 400,000, but that's not anything out of the ordinary compared to others.

Okay. All right. Thank you, Commissioner. Director, next.

Thank you. Moving on to page four, you'll see the overall general fund revenue summary through July. At this point in the year, we're at 49.5% of collections compared to our 2026 budget estimate. As you kind of move through the report, just to highlight a few areas, property taxes at 50%, we would expect those next payments to come in in the August, September timeframe. License and permit renewals come in that license fees group B, which is at 38%. Those come more towards the end of the year, so not a concern there. In the intergovernmental category of revenue, we're right where we would expect to be on budget. We did receive the second quarter casino revenue payment in July. That was $1.9 million, so it puts us right on pace, if not maybe a little bit ahead of our budget estimate there. In the category of charges for services, We're at 53.6% overall. Running a little bit ahead, I think as maybe I've mentioned in previous meetings in the EMS BLS transport fee category, a portion of that amount, about $4.5 million, is from one annual payment that comes in. investment earnings right now under the year-to-date budget pace that's one where we would expect that to catch up later in the year that's what we saw last year and then we have reported previously and we continue to see that on the other revenue category we are ahead at this point of the budget estimate there are some settlements related to PFAS that the city was involved in has received revenues related to that and then lastly in the other financing sources you'll see we're running a little bit ahead with the transfers in driven by the toll lot and be happy to take any questions if you had them okay let the record show councilman hobbs has also joined us uh council person ganas

Thank you. With the licensing and the permitting, is there any way we could get numbers on how it's looking for short-term rentals, convenience stores, vacant housing? I mean, we've really expanded those programs. I'd love to get some more details.

We could. I know short-term rentals, convenience stores flows through our treasury area, so we can pull that information. Convenience store renewal process is coming up now, so... That's picked up With a vacant property. We'll have to check with those departments, but we can we can do that.

Okay.

All right. Thank you Thank you so much.

Thank you chair Thank You council person So it looks pretty much like in terms of the revenue that we're pretty much on schedule

I think overall, within the categories, we're within income tax aside that we're watching that with the business net profit. A lot of the other categories are kind of right where we'd expect them. The only other piece though within there is on the refuse recycling collection fee. We did increase that budget estimate and increase the fee, but the fee increase took place later in the year, so that's one. We are seeing that the monthly collections in that area Previously were about 900,000. They're now closer to 1.4 million, so we're seeing that impact, but that is a budget estimate that will probably be a little short of as we head towards the end of the year.

Now the refuse fees are part of the water bills. So with the delinquency payments being made and given some consideration to writing off part of that, I imagine that we'll see an adjustment on that. Not only because we started late in the year June, or May was it that we started the refuse fee?

I think it was June, yeah, June.

Okay, so June. But also because I think, I don't know, are they writing off the garbage fee also?

I don't believe that is part of it. Okay.

Could you check on that? Because that would be important for council to be aware of that. Okay. Seeing no other questions, you want to cover expenditures?

Next two pages, page five and page six, cover general fund expenditures, both by category and then a breakdown by department. Overall, running just a little bit in total under the year to date budget pace. We do have variances in the labor category that we expect to see those decrease as the year goes on. Tend to be front loaded with certain contractual stipends and things that happen early in the year. As we've talked about at previous meetings, fire overtime has been a challenge compared to budget. They have mandatory recall overtime which impacts their overtime totals. So that's again one that we continue to watch. Pension, employment tax, and medical expenditures trending under budget. On the other labor category, that one is One-time payments that happen throughout the year so I don't expect any concerns compared to budget there We typically end up right around the budget estimate if not a little under supply and service category We do have a really on the service side, the main driver there. We did have a semiannual payment that was made here in July that covers a million dollars worth of expense for the rest of the year. So don't at this point have a concern on meeting the overall budget estimate on services. I'd be happy to take any questions. If not, on the next page. Just to highlight a few of the areas, as we're looking at this each month, if something's 10% more or ahead of the year-to-date pace, we kind of flag it and take a look at it. So you see a few areas on there, human resources, that's contracts, dollars that have been encumbered for spending that will still happen throughout the year, and that's for things like occupational health, pre-employment testing. So again, no budget concern there. Within our development area, they're processing all their vibrancy initiative contracts as well as TEI payments for the year. So no concern at 74% at this point. In our finance area, we did in finance administration have a one-time payment for our budgeting software that hit our budget. And then in the ERP area, we have funds that are encumbered for the year to spend for support services and hosting. Again, no budget concerns at this point. And then the last one where we're running ahead is waste disposal funds. which again within their area they've got about 1.8 million that are encumbered for spending that will happen in these last couple months of the year so things like the recycling collection or monitoring activities that happen at the landfill

Okay. Now, as counsel knows, the investment manager has gone to the city of Sylvania as the finance director, which we're happy for. Congratulations to him. So you've got a vacancy there. So you want to tell us in terms of who's handling the investment portfolio, at least on a temporary basis?

Yes. Our assessment officer, Roberta Martinez, has stepped in and is helping out in that area. We are in the process right now of updating our job description and getting it posted to fill that position. Okay.

All right. Thank you. Okay. Anything else?

No. The last couple pages show the all funds, revenues, and expenditures. Okay. I'd be happy to take any questions or I can move to the ARPA report.

Well, I don't see any other questions, so if you want to move to ARPA. I'm sorry, Councilman Martinez.

Thank you, Chair. I was just curious what the total minutes of power commitments and actuals are.

So Toledo, I think there's one customer that the city sells power to, and yeah.

No, thanks for, I know, okay, thank you.

Okay, yeah, proceed.

So for the July ARPA report, you'll see overall total expenditures from the start of the program through July are at $178.9 million, 96.7% of the total budget with $6.1 million remaining to spend. We do continue to talk regularly with the departments that have ongoing expenditures. We had several of them here last month to provide updates on how they're planning on spending it. A few areas, though, we do know that the timeline, 12-31 of 26, is going to be a challenge. That's something we've worked through with our law department, and that we have ability within the Treasury regulations to increase obligations where needed on existing projects, and then free free up dollars essentially in the general fund where we could still do the work uh... that we need to do for arpa but just not through the ARPA federal dollars and not subject to that ending deadline. And the ones really on the plate right now are the healthy food program, as well as the ARPA administration. We're just not gonna need all the dollars that are in that. Our plan at this point is to bring forward legislation to council at the agenda on the 15th that would make any adjustments needed to make sure that we fully spend these dollars. Not any new programs or spending, changes within the plan to make sure we meet the federal deadline.

Okay. Now, we still have money left over from medical debt forgiveness programs, so where are we at with that?

We reach out every month. We kind of check in with... Undo Medical, it used to be called RIP Medical. So I've sent them another update, just let us know if anything's changed. But the last update we got from them was that they do have a file related to Toledo residents. They're processing that, qualifying it, that it meets the guidelines. And they would expect to wrap up in September and then issue a final invoice.

And what was the date of that communication that was?

730 of 26.

Okay. All right, so Anything else under ARPA any questions from members of council? Regarding the ARPA spending so essentially there's still six million one hundred and one thousand eight ninety eight that has to be spent by the end of the year and again our understanding is that if money is left over in certain categories and it would have to be spent in a similar mission similar category within yeah within obligations that we already had at the end of 2024 the obligation deadline okay all right and you will keep us posted on that so so that again we're not meeting on december 27th to reallocate monies i don't think any of us would enjoy that so any questions on arpa well also i just want to bring out this afternoon the finance director and i i had a conversation and i've been asked by a few citizens if the arpa program the total funds are being audited and the director assured me that clark schaefer hackett our outside auditors do audit this very thoroughly and that they go through each category to make sure the money is being spent In addition to that, we have a committee internally of the law director, the finance director, and some others that are reviewing expenditures and appropriations to, again, make sure of that. Am I correct on that?

You are correct. Our federal dollars are subject each year to a federal audit. That's been done by Clark Schaefer Hackett. We haven't had any issues raised with our ARPA federal expenditures. And then we do have that team of law department members and our team in finance that meets and talks pretty regularly as ARPA questions come up.

Okay. And as I recall, you did try to hire a person in the finance department to specifically audit the ARPA monies, but what was the result of that?

Yeah, we had initially, when the program started, looked at seeing if we could hire an employee, pay them through ARPA dollars, and they could kind of manage and run the program. Didn't have success doing that. So our committee has kind of kept working. We leverage our consulting firm that helps us during our audit process if we do have questions that would maybe warrant their help. So we've taken that approach.

Great. Thank you. Councilman Martinez.

Thank you, Mr. Chair. So on the ARPA for the grocery store construction incentive. So I'm assuming that's like a marketing study or what exactly is that?

That is through neighborhoods to work with. It's a red and white market on their facility.

Gotcha. Okay.

All right. Thank you. Okay. Thank you, Councilman. Any other questions on ARPA?

Okay.

Thank you. Anything else we need to cover?

No. Nothing else from us. Thank you. Okay.

Great. Thank you. Before I get to the auditor, our next... Finance Committee meeting would be Wednesday, September 30th at 4 p.m. Wednesday, September 30th 4 p.m. Okay Now we'll turn to the city auditors report. Good afternoon, sir.

Good afternoon. John Ravolsky City Auditor quick monthly update here As you heard I'm working through the utility receivables analysis and I've had meetings there and I'm expecting that this upcoming month and And then I'm also working through the investments review, which I'm finalizing. And the grass cutting monitoring audit, that's also in progress. I am waiting on a few pieces of data that are outstanding, but I'm following up there. Let me know if you have any questions.

Any questions for the city auditor? Okay, thank you very much, sir. Is there any other business before the committee? I don't believe there is. Does anyone from the audience care to address the committee? If not, we stand adjourned. Thank you.